First Interstate Bancsystem Inc PRE 14A, filed Mar 10, 2023

First Interstate Bancsystem Inc (FIBK)

PRE 14A 2023-03-10

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Date:	Time:	Location:
May 24, 2023	4:00 p.m. MDT	First Interstate Great West Center
		1800 6th Ave. North
		Billings, MT


202 2 Executive Summary			1

Proposal One			9

Directors and Executive Officers and Business Biographies			11

Corporate Governance			22

Board and Committee Matters			25

Proposal Two			33

Proposal Three			48

Proposal Four			54

Proposal Five			55

Proposal Six			56

Report of the Audit Committee			57

Security Ownership of Certain Beneficial Owners and Management			58

Compensation Discussion and Analysis			61

Compensation of Named Executive Officers			73

Director Compensation			31

Certain Relationships and Related Party Transactions			90

Information About the Shareholder Meeting			91

Remaining Sections			95

Appendix A – Reconciliation of GAAP and Non-GAAP Financial Measures			A-1

Appendix B - Plan of Domestication and Conversion			B-1

Appendix C - 2023 Equity and Incentive Plan			C-1

Appendix D – Proxy Card			D-1


Time and Date:			4:00 p.m., Mountain Daylight Time, Wednesday, May 24, 2023
Place:			First Interstate Bank Great West Center, 1800 Sixth Avenue North, Billings, Montana 59101
Record Date:			Close of business on Friday, March 24, 2023
Voting:			Shareholders of record as of the record date are entitled to vote. We have outstanding only one class of common stock: Class A common stock. Each outstanding share of Class A common stock is entitled to one vote on all matters submitted to a vote of shareholders at the annual meeting.
Attendance:			If you plan to attend the annual meeting in person, you must bring the Notice of Internet Availability of Proxy Materials. If your shares are not registered in your name, you will need a legal proxy, account statement, or other documentation confirming your First Interstate BancSystem, Inc. holdings from the broker, bank, or other institution that is the record holder of your shares. You will also need a valid, government-issued picture identification that matches your Notice of Internet Availability of Proxy Materials, legal proxy, or other confirming documentation.
Adjournments:			Any action on the items of business described above may be considered at the annual meeting at the time and on the date specified above or at any time and date to which the annual meeting may be properly adjourned or postponed.


$202.2	$1.96	6.34%	/	10.09%	$29.43
Net Income	Diluted Earnings Per Share	ROAE / ROATCE*			Book Value Per Share


$364.8	$3.53	11.44%	/	18.21%	$17.69
Adjusted Net Income*	Adjusted Diluted Earnings Per Share*	Adjusted ROAE* / Adjusted ROATCE*			Tangible Book Value Per Common Share*


PRELIMINARY PROXY STATEMENT - SUBJECT TO COMPLETION
2022 Summary


☑			All Board Committees are chaired by independent directors;
☑			Regular executive sessions of independent directors;
☑			Equity ownership guidelines for directors and executive officers; and
☑			Cash and equity awards with clawback provisions.


Name and Age	Director Since	Principal Occupation
Alice S. Cho, 56	2020	Senior Advisor, Boston Consulting Group
Thomas E. Henning, 70	2022	Manager- Henning LLC companies
Dennis L. Johnson, 68	2017	Retired President and CEO, United Heritage Mutual Holding Company
Patricia L. Moss, 69	2017	Retired President and CEO, Cascade Bancorp.
Daniel A. Rykhus, 58	2022	Strategic Advisor, Raven Industries


The following table sets forth information concerning each of our directors, director nominees, and executive officers. Additional biographical information for each of these individuals follows below under the caption "Business Biographies.

Name	Age	Position
David L. Jahnke	69	Chair of the Board
Kevin P. Riley	63	President, Chief Executive Officer, and Director
Lorrie L. Asker	55	Senior Vice President & Interim Chief Banking Officer
Stephen B. Bowman	59	Director
James P. Brannen	60	Director
Alice S. Cho	56	Director
Scott E. Erkonen	51	Executive Vice President and Chief Information Officer
Frances P. Grieb	62	Director
Thomas E. Henning	70	Director
John M. Heyneman, Jr.	55	Director
Kirk D. Jensen	53	Executive Vice President and General Counsel
Dennis L. Johnson	68	Director
Karlyn M. Knieriem	55	Executive Vice President and Chief Risk Officer
Stephen M. Lacy	69	Director
Patricia L. Moss	69	Director
Marcy D. Mutch	63	Executive Vice President and Chief Financial Officer
Joyce A. Phillips	60	Director
Kristina R. Robbins	54	Senior Vice President and Chief Operations Officer
Daniel A. Rykhus	58	Director
James R. Scott	73	Director
Jonathan R. Scott	48	Director


Board Diversity Matrix (As of March 24, 2023)
	Female	Male
Total Number of Directors	15
Part I: Gender Identity
Directors	4	11
Part II: Demographic Background
Asian	1
White	3	11


Qualifications	Committee Memberships	Additional Current Public Company Board of Director Memberships
•Significant experience in the accounting, auditing, and financial service industries, both nationally and internationally •Extensive knowledge in key issues, dynamics, and trends affecting the Company, its business, and banking industry in general •Extensive knowledge regarding fiduciary obligations, insurance, and other legal requirements and duties of a public company.	•Executive Committee (Chair) •Governance and Nominating Committee	•Swiss Re America Holding Corporation (Audit Committee Chair) •Schnitzer Steel Industries, Inc. (Lead Independent Director, Audit Committee and Compensation Committee Member)


Key Corporate Governance Documents
Please visit our website at www.FIBK.com for our corporate governance documents. Shareholders may also request a copy of any corporate governance documents by contacting our Corporate Secretary at: P.O. Box 30918, Billings, MT 59116			▪Corporate Governance Guidelines
			▪Charters for each of the Company’s standing Board committees
			▪Code of Conduct
			▪Insider Trading Policy


☑			Overseeing our mission, vision, and values;
☑			Hiring and evaluating our Chief Executive Officer;
☑			Providing oversight of management regarding strategic direction;
☑			Ensuring management succession;
☑			Monitoring our performance against established criteria;
☑			Overseeing adherence to ethical practices;
☑			Overseeing compliance with federal and state law;
☑			Ensuring that full and fair disclosure is provided to shareholders, regulators, and other constituents;
☑			Overseeing risk management; and
☑			Approving certain policies for Company operations.


Tenure on Board			Number of Directors
More than 10 years			4
6-10 years			3
5 years or less			8


Audit Committee
Chair*: Frances P. Grieb	Additional Members: Stephen B. Bowman, Alice S. Cho, Dennis L. Johnson, and Joyce A. Phillips	Independence: Each member of the Audit Committee is independent under applicable law and NASDAQ Marketplace Rules
Meetings Held in 2022: 9
Key Committee Responsibilities:
•Represents and assists our Board in its oversight responsibility relating to the quality and integrity of the Company’s financial statements and related internal controls; internal and external audit independence, qualifications, and performance; and the processes for monitoring compliance with laws and regulations.
•Oversees the appointment, compensation, and retention of our independent, registered public accounting firm, including the performance of permissible audit, audit-related, and non-audit services, and the associated fees.
•Establishes procedures for the confidential, anonymous submission by employees of concerns regarding questionable accounting, reporting, internal control, or auditing matters as well as monitoring our compliance with ethics programs.
•Our Board has determined that Frances P. Grieb, Stephen B. Bowman, Alice S. Cho, and Dennis L. Johnson qualify as “audit committee financial experts” as that term is defined in applicable law and each of the Audit Committee members have the requisite financial literacy and accounting or related financial-management expertise required generally of an Audit Committee member under the applicable standards of the SEC and NASDAQ. *Ross Leckie served as Chair of the Audit Committee until his retirement from the Board on January 12, 2023. Immediately following Mr. Leckie’s retirement, Ms. Grieb was appointed as Chair of the Audit Committee.


Table of Contents


Annual Meeting


Compensation and Human Capital Committee
Chair: Patricia L. Moss	Additional Members: Stephen B. Bowman, Stephen M. Lacy, Daniel A. Rykhus, and James R. Scott	Independence: Each member of this committee is independent under applicable NASDAQ Marketplace Rules
Meeting Held in 2022: 5
Key Committee Responsibilities:
•Reviews and approves goals relevant to compensation for executive officers and evaluating the effectiveness of our compensation practices in achieving Company objectives, encouraging behaviors consistent with our values, and aligning performance objectives.
•Reviews and discusses with the Chief Executive Officer the compensation of our executive officers, recommends approval of the compensation of the Chief Executive Officer, and oversees succession planning for our executive officers.
•Oversees the Company’s equity and incentive compensation plans and operation of compensation programs affecting the Company’s employees generally. In addition, the Compensation and Human Capital Committee recommends compensation for Board members.
•All equity awards granted to the Company’s officers who are subject to Section 16 of the Exchange Act (“Section 16 Officers”) were approved by the Board's non-employee directors as that term is defined for purposes of Rule 16b-3 under the Exchange Act (collectively the “Outside Members”). The Compensation and Human Capital Committee has delegated authority to our Chief Executive Officer to make awards to employees who are not Section 16 Officers.
Compensation Consultant. The Compensation and Human Capital Committee has retained the services of Pearl Meyer & Partners (“Pearl Meyer”), a compensation consulting firm, to assist with its executive compensation review and to provide competitive market data. A consultant from Pearl Meyer generally attends the Compensation and Human Capital Committee meetings at which executive officer compensation is discussed and provides information, research, and analysis pertaining to executive compensation and updates on market trends as requested by the Compensation and Human Capital Committee. In connection with its engagement of Pearl Meyer, the Compensation and Human Capital Committee considered various factors bearing upon Pearl Meyer’s independence including, but not limited to, the amount of fees received by Pearl Meyer from the Company, Pearl Meyer’s policies and procedures designed to prevent conflicts of interest, and the existence of any business or personal relationship that could impact Pearl Meyer’s independence. After reviewing these and other factors, the Compensation and Human Capital Committee determined that Pearl Meyer was independent and that its engagement did not present any conflicts of interest. Pearl Meyer does not provide executive compensation services to the Company. The Compensation and Human Capital Committee sets compensation levels based on the skills, experience, and achievements of each executive officer, considering market analysis and input provided by Pearl Meyer and the compensation recommendations of our Chief Executive Officer, except with respect to his own position. The Compensation and Human Capital Committee believes that input from both Pearl Meyer and our Chief Executive Officer provides useful information and perspective to assist the Compensation and Human Capital Committee in determining the appropriate compensation.
Compensation and Human Capital Committee Interlocks and Insider Participation:
•No members of the Compensation and Human Capital Committee who served during 2022 were officers or employees of the Company during the year, or were former officers of the Company, or had any relationship requiring disclosure under the caption "Certain Relationships and Related Party Transactions" included below in this proxy statement other than James R. Scott, who served as Chair of the Board from 2016 to 2020 and as Vice Chair in prior periods.
•No executive officer of the Company served on the compensation committee or board of directors of another company that had an executive officer who served on the Company's Compensation and Human Capital Committee or Board.


Executive Committee
Chair: David L. Jahnke	Additional Members: James P. Brannen, John M. Heyneman, Jr., Patricia L. Moss, Kevin P. Riley, and James R. Scott	Independence: Each member of this committee is independent under applicable NASDAQ Marketplace Rules other than Mr. Riley.
Meetings Held in 2022: 3
Key Committee Responsibilities:
•The Executive Committee functions and acts on behalf of the Board between regularly scheduled board meetings, usually when time is critical, and assists the Board in carrying out its responsibility to monitor our capital management, strategic planning and budgeting, mergers and acquisitions, tax allocation, and management fees policies. The committee is also responsible for the CEO Succession Planning Process.


Governance and Nominating Committee
Chair: John M. Heyneman, Jr.	Additional Members: David L. Jahnke, Patricia L. Moss, Stephen M. Lacy, and Daniel A. Rykhus	Independence: Each member of this committee is independent under applicable NASDAQ Marketplace Rules
Meetings Held in 2022: 4
Key Committee Responsibilities:
•Oversees the Company’s corporate governance needs and assists the Board with the process of identifying, evaluating, and nominating candidates for membership to our Board.
•Evaluates the performance of our Chair and oversees the functions and needs of the Board and its committees, including overseeing the orientation and development of Board members, evaluating the effectiveness of the Board, each committee, and the respective performance of each Board member; and evaluating services provided to and communications with shareholders.
•Reviews and approves related party transactions.
•Assists the Board in providing primary oversight of the Company’s Environmental, Social, and Governance (ESG) program.
•Reviews each committee’s annual priorities during a meeting of the Chair of the Board and the committee chairs to increase the efficiency of the work of the Board and the committees.


Risk Committee
Chair: Dennis L. Johnson	Additional Members: Alice S. Cho, Frances P. Grieb, Thomas E. Henning, and Jonathan R. Scott	Independence: Each member of this committee is independent under applicable NASDAQ Marketplace Rules
Meetings Held in 2022: 4
Key Committee Responsibilities:
•Oversees the Company’s enterprise-wide risk management program and corporate risk function, which include the strategies, policies, and systems established by senior management to identify, assess, measure, monitor, and manage the Company’s significant risks.
•Assesses whether management’s implementation of the program is capable of managing those risks consistent with the Company’s risk appetite.
•Monitors whether the Company’s most significant enterprise-wide risk exposures are in alignment with the Company’s appetite for risk.
•Coordinates with and serves as a resource to the Board of Directors and other Board committees through facilitation of the understanding of enterprise-wide risk management processes and effectiveness.


Technology Committee
Chair: Joyce A. Phillips	Additional Members: James P. Brannen, Alice S. Cho, Thomas E. Henning, Dennis L. Johnson, and Jonathan R. Scott	Independence: Each member of this committee is independent under applicable NASDAQ Marketplace Rules
Meetings Held in 2022: 4
Key Committee Responsibilities:
•Assists the Board by providing oversight of our technology initiatives to allow the Company to meet its strategic objectives.
•Assesses and monitors technology, information, and cybersecurity risks; monitors technology and industry trends; and evaluates management’s assessment of their effects on our strategy and their implications for long-range planning.
•Oversees the Company’s technology risks and provides updates to the Board, with assistance from the Risk Committee.


Committee	Chair Retainer(1)	Member Retainer
Audit	$22,500	$10,000
Compensation and Human Capital	20,000	10,000
Executive	—	7,500
Governance and Nominating	17,500	7,500
Risk	20,000	10,000
Technology	17,500	7,500


Name	Fees Earned or Paid In Cash(1)		Stock Awards (2)		Options Awards		Total
David L. Jahnke	$	87,500	$	110,000	$	—	$	197,500
Kevin P. Riley (3)	—		—		—		—
Stephen B. Bowman	62,500		60,000		—		122,500
James P. Brannen(4)	67,083		78,333		—		145,416
Alice S. Cho	75,000		60,000		—		135,000
Frances P. Grieb(4)	58,333		93,333		—		151,666
Thomas E. Henning(4)	69,791		78,333		—		148,124
John M. Heyneman, Jr.	74,583		60,000		—		134,583
Dennis L. Johnson	85,312		60,000		—		145,312
Stephen M. Lacy(4)	70,625		78,333		—		148,958
Ross E. Leckie (5)	38,750		110,000		—		148,750
Patricia L. Moss	82,812		60,000		—		142,812
Joyce A. Phillips	75,625		60,000		—		135,625
Daniel A. Rykhus(4)	70,625		78,333		—		148,958
James R. Scott	55,833		60,000		—		115,833
Jonathan R. Scott	61,875		60,000		—		121,875


Before the Conversion: Provisions Applicable to First Interstate-Montana						After the Conversion: Provisions Applicable to First Interstate-Delaware
Elections; Voting; Procedural Matters
Voting – Director Elections						Voting – Director Elections
The Montana Articles and Montana Bylaws provide that directors are elected by a majority of the voting power of the shares of capital stock present in person or represented by proxy at an annual meeting of shareholders and entitled to vote on the election of directors.						The Delaware Certificate of Incorporation and Delaware Bylaws will be substantially identical to the Montana Articles and Montana Bylaws with respect to majority voting requirements for directors.

Term of Directors						Term of Directors
The Montana Articles and Montana Bylaws provide that directors are elected at annual meetings of shareholders for three year terms and hold office until a successor is elected and has qualified or until their earlier death, resignation, removal or disqualification.						The Delaware Certificate of Incorporation and Delaware Bylaws will be substantially identical to the Montana Articles and Montana Bylaws with respect to the terms of directors.

Classified Board						Classified Board
The Montana Articles and Montana Bylaws provide that directors shall be divided into three classes with each class to be as nearly equal with the other classes in number as possible.						The Delaware Certificate of Incorporation and Delaware Bylaws will be substantially identical to the Montana Articles and Montana Bylaws with respect to the classified board.

Number of Directors						Number of Directors
The Montana Bylaws provide that the number of directors shall at least five (5) and not more than eighteen (18), with the precise number of directors within that range to be set from time to time by resolution of the board of directors.						The Delaware Bylaws will be substantially identical to the Montana Bylaws with respect to the number of directors and the manner within the range that they are to be set.

Removal of Directors by Shareholders						Removal of Directors by Shareholders
The Montana Articles provide that, subject to the rights of the holders of any series of preferred stock then outstanding, any director may be removed at any time, with or without cause, by the affirmative vote of the holders of a majority of the voting power of the issued and outstanding shares of capital stock of the Company then entitled to vote in the election of directors.						The Delaware Certificate of Incorporation will be substantially identical to the Montana Articles with respect to the removal of directors by shareholders with or without cause.

Board Vacancies; Newly Created Directorships						Board Vacancies; Newly Created Directorships
The Montana Articles and Montana Bylaws provide that, except as otherwise provided for or fixed by or pursuant to the Montana Articles in relation to the rights of the holders of preferred stock to elect directors under specified circumstances, newly created directorships resulting from any increase in the number of directors, created in accordance with the Montana Bylaws, and any vacancies on the Board resulting from death, resignation, removal, disqualification, or other cause shall be filled only by the affirmative vote of a majority of the remaining directors then in office, even though less than a quorum of the Board, or by a sole remaining director. Any director elected to fill a vacancy or a newly created directorship shall hold office until the next annual meeting of shareholders and until such director’s successor shall have been elected and qualified, or until such director’s earlier death, resignation or removal.						The Delaware Certificate of Incorporation and Delaware Bylaws will be substantially identical to the Montana Articles and Montana Bylaws with respect to board vacancies and newly created directorships, except that any directors elected to fill vacancies by the remaining directors then in office shall in accordance with Delaware law hold office until the next election of the class for which such directors shall have been chosen, and until their successors shall be elected and qualified, rather than until the next annual meeting of shareholders and until their successors shall be elected and qualified.


Shareholder Voting – Quorum						Shareholder Voting – Quorum
The Montana Bylaws provide that shareholders representing a majority of the voting power of the issued and outstanding capital stock of the corporation, present in person or represented by proxy, shall constitute a quorum for the transaction of business at all meetings of the shareholders.						The Delaware Bylaws will be substantially identical to the Montana Bylaws with respect to determining a quorum for the transaction of business at all meetings of the shareholders.

Shareholder Voting – Action Generally						Shareholder Voting – Action Generally
The Montana Bylaws provide that, if a quorum exists, action on a matter, other than the election of directors, is approved by the shareholders if the votes cast favoring the action exceed the votes cast opposing the action, unless the Montana Articles or the MBCA requires a greater number of affirmative votes.						The Delaware Bylaws will provide for substantially the same voting requirements for approval of general matters, other than the election of directors, to be considered by shareholders for a vote.

Shareholder Proposals; Advance Notice						Shareholder Proposals; Advance Notice
The Montana Bylaws provide that shareholders who wish to present an item of business or nominate a director at an annual meeting must provide written notice to the Company’s corporate secretary not earlier than 120 days prior and not later than 90 days prior to the anniversary date of the immediately preceding annual meeting unless the date of the annual meeting of shareholders is more than 30 days before or after such anniversary date, and in which case, written notice must be submitted within 10 days after the first public announcement of such annual meeting. With respect to shareholder director nominees, such notice must contain the information described in Section 2.15 of the Montana Bylaws, including specific biographical information, beneficial ownership and other information about such nominee, as well as a description of any compensatory arrangement or other financial arrangement or understanding between the proposed nominee and the proposing shareholder (and its affiliates) within the last three years and a description of any business or personal interests that could be reasonably be expected to place the nominee in a potential conflict of interest with the Company. With respect to other proposals, such notice must contain the information described in Section 2.14, including a brief description of the business desired to be brought before the annual meeting, the text of the proposal, and the reasons for such proposal. In addition, shareholders must provide certain information with respect to themselves and must meet certain criteria to be eligible to submit any director nominee(s) or propose matters to be brought before a meeting, including that the shareholder is a shareholder of record at the time of giving notice of that shareholder’s nominee or proposal and that the shareholder is a shareholder of record at the time of the annual meeting.						The Delaware Bylaws will have substantially the same advance notice requirements for shareholder proposals and shareholder director nominees as the Montana Bylaws currently provide.


Shareholder Voting – Mergers						Shareholder Voting – Mergers
Montana law provides that in addition to approval by the board of directors, unless the articles of incorporation require a greater vote or a lesser vote, the terms of a merger or a share exchange generally must be approved by a majority of the votes entitled to be cast on the plan of merger or share exchange and, if any class or series of shares is entitled to vote as a separate group on the plan of merger or share exchange, the approval of a majority of the votes entitled to be cast on the merger or share exchange by that voting group. The Montana Articles provide that if the merger or share exchange would constitute a “Change of Control Transaction”, as defined in the Montana Articles and which term includes mergers and share exchanges involving the Corporation in which shares of the Company’s common stock are exchanged for, converted into or otherwise changed into other stock or securities or the right to receive cash or any other property, the transaction must be approved by the affirmative vote of the shareholders holding the greater of: (i) a majority of the voting power of the issued and outstanding shares of capital stock of the Corporation then entitled to vote thereon, voting together as a single class, and (ii) sixty-six and two-thirds percent (66.67%) of the voting power of the shares of capital stock present in person or represented by proxy at the shareholder meeting called to consider the Change in Control Transaction and entitled to vote thereon, voting together as a single class. A shareholder vote is not required for a plan of merger if (a) the company will survive the merger, (b) the articles of the corporation will not be amended or the amendment is such that shareholder approval is not required, (c) each shareholder with shares that were outstanding immediately before the merger’s effective date will hold the same number of shares with identical preferences, rights and limitations immediately after the merger, and (d) the issuance in the merger of shares or other securities convertible into or rights exercisable for shares does not require a vote under Montana law.						Delaware law is consistent with Montana law in this respect and provides that in addition to approval by the board of directors, the terms of a merger or a consolidation of a corporation generally must be approved by a majority of outstanding shares entitled to vote on the merger or consolidation. The Delaware Certificate of Incorporation will also contain provisions substantially identical to the Montana Articles with respect to the approval of mergers or consolidations that would constitute a “Change of Control Transaction”, as defined in the current Montana Articles. A shareholder vote of the surviving corporation in a merger is generally not required (unless otherwise required by its certificate of incorporation) if (a) the plan of merger does not amend the existing certificate of incorporation, (b) each share of stock of the surviving corporation outstanding immediately before the effective date of the merger is an identical outstanding share after the merger, and (c) either no shares of common stock of the surviving corporation and no shares, securities or obligations convertible into such stock are to be issued or delivered under the plan of merger, or the authorized unissued shares or treasury shares of common stock of the surviving corporation to be issued or delivered under the plan of merger plus those initially issuable upon conversion of any other shares, securities or obligations to be issued or delivered under such plan do not exceed 20% of the shares of common stock of such constituent corporation outstanding immediately prior to the effective date of the merger.

Shareholder Action by Written Consent						Shareholder Action by Written Consent
Montana law allows shareholders to act by written consent, but, unless otherwise provided by the company’s articles of incorporation, such actions must be consented to by all of the shareholders entitled to vote on that action. The Montana Articles and Montana Bylaws prohibit the shareholders from taking any action by written consent.						Delaware law provides that unless the certificate of incorporation provides otherwise, any action to be taken at a meeting of the shareholders may be taken without a meeting if the holders of outstanding stock having at least the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted consent to the action in writing. The Delaware Certificate of Incorporation and Delaware Bylaws will be substantially identical to the Montana Articles and Montana Bylaws with respect to prohibiting shareholder action by written consent.


Special Meetings of Shareholders						Special Meetings of Shareholders
Montana law provides that special meetings of the shareholders may be called by (i) the board of directors, (ii) the person or persons authorized to do so by the articles of incorporation or bylaws or (iii) by shareholders holding at least 10% of all the votes entitled to be cast on an issue proposed to be considered at the proposed special meeting, provided that the articles of incorporation may fix a lower percentage or a higher percentage, not exceeding 25%, of all the votes entitled to be cast on any issue proposed to be considered. The Montana Articles and the Montana Bylaws provide that, unless otherwise required by law, special meetings of the shareholders may be called at any time, for any purpose or purposes, only by (i) the Board, (ii) the Chair of the Board, (iii) the Chief Executive Officer (or, in the absence of the Chief Executive Officer, the President) of the corporation, or (iv) holders of more than ten percent (10%) of the total voting power of the outstanding shares of capital stock of the corporation then entitled to vote.						Delaware law provides that special meetings of the shareholders may be called by the board of directors or by such person or persons as may be authorized by the certificate of incorporation or by the bylaws. The Delaware Certificate of Incorporation and Delaware Bylaws will be substantially identical to the Montana Articles and the Bylaws with respect to who will be authorized to call special meetings of shareholders.

Amendment of Montana Articles						Amendment of Delaware Certificate of Incorporation
Montana law provides that a corporation may amend its articles of incorporation by adoption of a board resolution followed by a majority vote of shareholders entitled to vote, unless the articles of incorporation require a greater or lesser vote. In addition, unless the articles of incorporation provide otherwise, directors may amend the company’s articles of incorporation without shareholder approval (i) to make certain administrative changes, (ii) if the corporation has only one class of shares outstanding: to change each issued and unissued authorized share of the class into a greater number of whole shares of that class or to increase the number of authorized shares of the class to the extent necessary to permit the issuance of shares as a share dividend, or (iii) if so authorized by the articles of incorporation to classify or reclassify any unissued shares into one or more classes or into one or more series within a class as provided. The Montana Articles provide that the Montana Articles may be amended pursuant to Montana law.						Delaware law provides that a corporation may amend its certificate of incorporation by adoption of a board resolution followed by the affirmative vote of the majority of shareholders. If an amendment directly affects the shares of a class or series of stock, the holders of the class or series are entitled to vote on the amendment as a class, unless the certificate of incorporation opts out of the separate class vote for increases or decreases in the number of authorized shares of any class of stock. If a certificate of incorporation requires a greater vote for action by the board of directors, shareholders or other security holders than otherwise required under Delaware law, the provision requiring the greater vote may be amended only by that greater vote. With the exception of the statutory provisions described above, the Delaware Certificate of Incorporation will be substantially identical to the Montana Articles with respect to amendments to the certificate of incorporation.


Amendment of Bylaws						Amendment of Bylaws
Montana law provides that shareholders may amend or repeal the company’s bylaws. Montana law also provides that the board may amend or repeal the bylaws unless the articles of incorporation or Montana law reserves that power exclusively to the shareholders or if the shareholders in amending, repealing, or adopting a bylaw expressly provide that the board of directors may not amend, repeal, or adopt that bylaw, except that with respect to bylaws pertaining to proxy solicitations for the election of directors, the shareholders in amending, repealing, or adopting such a bylaw may not limit the authority of the board of directors to amend or repeal any condition or procedure set forth in or to add any procedure or condition to such bylaw to provide for a reasonable, practical, and orderly process. The Montana Articles and Montana Bylaws provide that the Montana Bylaws may be adopted, amended or repealed by a majority of the voting power of the shareholders entitled to vote or by the Board.						Delaware law provides that a corporation’s shareholders may adopt, amend or repeal the corporation’s bylaws without board approval. If permitted by a corporation’s certificate of incorporation, the corporation’s directors may amend or repeal the bylaws, subject to the shareholders’ power to amend or repeal the bylaws. A bylaw amendment adopted by shareholders which specifies the votes necessary for director elections cannot be amended or repealed by the board of directors. The Delaware Certificate of Incorporation and Delaware Bylaws will be substantially identical to the Montana Articles and Montana Bylaws with respect to the power to amend the Delaware Bylaws.

Board or Committee Action by Written Consent						Board or Committee Action by Written Consent
The Montana Bylaws permit the Board, or any committee of the Board, to take any action by a written consent, without a meeting, if such action is consented to by all of the members of the Board or such committee.						The Delaware Delaware Bylaws will be substantially identical to the Montana Bylaws with respect to action by written consent of the board of directors or any of its committees.

Interested Party Transactions						Interested Party Transactions
Montana law provides that a contract or transaction between a corporation and one or more of its directors, or between a corporation and any other entity in which one or more of its directors are directors or officers, or have a financial interest, may not be enjoined, set aside or give rise to damages if: (i) it is approved by a majority of qualified directors; (ii) it is approved by the affirmative vote of a majority of all qualified shares; or (iii) at the time of commitment, the transaction was fair to the corporation. For purposes of this provision, a “qualified director” is one who does not have (a) a conflicting interest respecting the transaction or (b) a familial, financial, professional or employment relationship with a second director who does have such a conflict and which relationship would reasonably be expected to exert an influence on the first director’s judgment when voting on the transaction. “Qualified shares” are defined generally as shares other than those beneficially owned, or the voting of which is controlled, by a director who has a conflicting interest respecting the transaction. The Montana Articles and Montana Bylaws do not vary from Montana law.						Delaware law provides that a contract or transaction between a corporation and one or more of its directors or officers, or between a corporation and any other entity in which one or more of its directors or officers are directors or officers, or have a financial interest, is not void or voidable solely because of such relationship or interest, or solely because the director or officer is present at or participates or votes at the meeting of the board or committee that authorizes the contract or transaction, if: (i) the material facts of the director’s or officer’s relationship or interest and as to the contract or transaction are disclosed to or known by the board or committee, and the board or committee in good faith authorizes the contract or transaction by the affirmative vote of the majority of the disinterested directors (even if these directors are less than a quorum); (ii) the material facts of the director’s or officer’s relationship or interest and as to the contract or transaction are disclosed to or known to the shareholders entitled to vote on the matter and they specifically approve in good faith the contract or transaction; or (iii) the contract or transaction is fair to the corporation as of the time it was authorized, approved or ratified. The Delaware Certificate of Incorporation and Delaware Bylaws will not vary from Delaware law.


Dissent and Appraisal Rights						Dissent and Appraisal Rights
Montana law provides that a shareholder is entitled to dissent from and, upon perfection of his or her appraisal right, to obtain fair value of his or her shares in the event of certain corporate actions, including certain mergers, consolidations, share exchanges, sales of substantially all assets of the corporation, and amendments to the corporation’s articles of incorporation that materially and adversely affect shareholder rights. Subject to certain exceptions, however, appraisal rights do not apply to shares of any class or series of shares that is: (i) a covered security under section 18(b)(1)(A) or (B) of the Securities Act of 1933; (ii) traded in an organized market and has at least 2,000 shareholders and a market value of at least $20 million, exclusive of the value of shares of that class or series held by the corporation’s subsidiaries, senior executives, and directors and by any beneficial shareholder and any voting trust beneficial owner owning more than 10% of those shares; or (iii) issued by an open-end management investment company registered with the United States Securities and Exchange Commission under the Investment Company Act of 1940 and that may be redeemed at the option of the holder at net asset value. The Montana Articles and Montana Bylaws do not vary from Montana law.						Delaware law provides that appraisal rights are available only in connection with statutory mergers or consolidations, or an amendment of a corporation’s certificate of incorporation to cause it to become a public benefit corporationthe conversion of a corporation into another type of entity, and only to shareholders who have neither voted in favor of nor consented in writing to the action. In addition, in the case of most mergers, unless the certificate of incorporation provides otherwise, shareholders do not receive appraisal rights for any class or series of stock (a) listed on a national securities exchange or (b) that has more than 2,000 shareholders, except if shareholders are required to accept anything other than (i) shares of the corporation surviving or resulting from the merger or consolidation, (ii) shares of any other corporation which at the effective time of the merger or consolidation are either listed on a national securities exchange or that has more than 2,000 shareholders, (iii) cash in lieu of fractional shares, or (iv) any combination of the foregoing shares and cash in lieu of fractional shares. The Delaware Certificate of Incorporation and Delaware Bylaws will not vary from Delaware law.

Sale of Assets; Dissolution; Winding Up						Sale of Assets; Dissolution; Winding Up
Montana law provides that, unless the articles of incorporation require a greater vote or a lesser vote, a sale, lease, exchange, or other disposition of assets, not in the ordinary course of business, requires approval of the corporation’s shareholders if the disposition would leave the corporation without a significant continuing business activity. In such instances, as well as a dissolution of the corporation, the disposition or dissolution requires approval of a majority of the votes entitled to be cast and, if any class or series of shares is entitled to vote as a separate group, the approval of a majority of the votes entitled to be cast by that voting group. The Montana Articles and Montana Bylaws do not vary from Montana law.						Delaware law provides that the holders of a majority of the outstanding voting stock of a corporation must vote to approve (a) the disposition of all or substantially all of a corporation’s property and assets, and (b) the dissolution of the corporation, unless a greater vote is provided for in the certificate of incorporation. The Delaware Certificate of Incorporation and Delaware Bylaws will not vary from Delaware law.


Limitation on Personal Liability of Directors and Officers						Limitation on Personal Liability of Directors and Officers
Montana Law provides that a corporation’s articles of incorporation may eliminate or limit personal liability for conduct as a director, except for the amount of an improper personal benefit, intentional misconduct, intentional violations of criminal law, or unlawful distributions. Montana law does not provide for the elimination or limitation of personal liability for conduct as an officer. The Montana Articles provide that no director of First Interstate-Montana will be personally liable to First Interstate-Montana or its shareholders for monetary damages for breach of fiduciary duty as a director to the fullest extent permitted by Montana law.						Delaware law provides that a corporation is permitted to adopt a provision in its certificate of incorporation eliminating or limiting the personal liability of directors and officers to the corporation and its shareholders for monetary damages for breach of fiduciary duty as directors or officers. Delaware law currently provides that this limitation of liability does not apply to liability (a) for breach of the director’s or officer’s duty of loyalty to the corporation or its shareholders, (b) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (c) of a director for illegal distributions to shareholders or unlawful stock repurchases, (d) for any transaction from which the director or officer derived any improper personal benefit, or (e) of an officer in any action by or in the right of the corporation. The Delaware Certificate of Incorporation will be substantially identical to the Montana Articles with respect to the limitation on personal liability of directors to First Interstate-Delaware, and will expand the limitation of personal liability to include officers as permitted under Delaware law.


Indemnification of Directors and Officers						Indemnification of Directors and Officers
Montana law provides that indemnification of directors and officers is authorized to cover judgments, amounts paid in settlement, and expenses arising out of actions where the director or officer acted in good faith and in or not opposed to the best interests of the corporation, and, in criminal cases, where the director or officer had no reasonable cause to believe that his or her conduct was unlawful. Unless limited by the corporation’s articles of incorporation, Montana law requires indemnification if the director or officer is wholly successful on the merits of the action. The Montana Articles and Montana Bylaws require that First Interstate-Montana indemnify directors and officers to the fullest extent permitted by law.						Delaware law provides that a corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by the person in connection with such action, suit or proceeding if the person: (a) acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the corporation, and (b) with respect to any criminal action or proceeding, had no reasonable cause to believe the person’s conduct was unlawful. With respect to actions by or in the right of the corporation, no indemnification may be made in respect of any claim, issue or matter as to which a person has been adjudged to be liable to the corporation unless and only to the extent that the Court of Chancery or the court in which such action or suit was brought determines upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery or such other court deems proper. The Delaware Certificate of Incorporation and Delaware Bylaws will require that First Interstate-Delaware indemnify directors and officers to the fullest extent permitted by law.

Advancement of Expenses						Advancement of Expenses
Montana law provides that a corporation may, before final disposition of a proceeding, advance funds to pay for or reimburse expenses incurred in connection with the proceeding by an individual who is a party to the proceeding because that individual is a director if the director delivers to the corporation a signed, written undertaking of the director to repay any funds advanced in the event that (i) the director is not entitled to mandatory indemnification under Montana law and (ii) it is ultimately determined under Montana law that the director is not entitled to indemnification. The Montana Articles and Montana Bylaws do not vary from Montana law with respect to advancement of expenses.						Delaware law provides that expenses incurred by a director or officer in defending any civil, criminal, administrative or investigative action, suit or proceeding may be paid by the corporation in advance of the final disposition of the action, suit or proceeding upon receipt of an undertaking by or on behalf of the director or officer to repay the amount if it is ultimately determined that he or she is not entitled to be indemnified by the corporation. The Delaware Certificate of Incorporation and Delaware Bylaws will not vary from Delaware law with respect to advancement of expenses.


Exclusive Jurisdiction						Exclusive Jurisdiction
The Montana Bylaws do not contain an exclusive jurisdiction provision.						The Delaware Bylaws will contain an exclusive jurisdiction provision, which will provide that any shareholder derivative suits, fiduciary duty claims and other intra-corporate actions must be brought in Delaware courts, in order for the Company to take full advantage of, and ensure it receives the full benefit of, becoming a Delaware corporation.

Authorized Shares; Dividends
Authorized Shares						Authorized Shares
The Montana Articles authorize 150,000,000 shares of Class A common stock, 100,000,000 shares of Class B common stock (which may not be reissued without first obtaining the affirmative vote of the holders of a majority of the outstanding shares of Class A Common Stock), and 100,000 shares of preferred stock						The Delaware Certificate of Incorporation will authorize 150,000,000 shares of common stock and 100,000 shares of preferred stock.

Preferred Stock						Preferred Stock
The Montana Articles authorize the board of directors from time to time to provide for the issuance of shares of preferred stock in one or more series, and to fix the relative rights and preferences of each such series.						The Delaware Certificate of Incorporation will be substantially identical to the Montana Articles with respect to preferred stock.

Declaration and Payment of Dividends						Declaration and Payment of Dividends
Montana law does not provide any specific statutory provisions dealing with dividend sources. Under Montana law, a corporation may make distributions to its shareholders as long as, after giving effect to such distribution, (a) the corporation would be able to pay its debts as they become due in the usual course of business or (b) the corporation’s total assets would not be less than the sum of its total liabilities plus, unless the articles of incorporation permit otherwise, the amount that would be needed if the corporation were to be dissolved at the time of the distribution to satisfy the preferential rights upon dissolution of shareholders whose preferential rights are superior to those receiving the distribution. The Montana Articles do not vary from Montana law. The Montana Bylaws provide that the board of directors shall have the authority to declare dividends and other distributions to the extent permitted by law.						Delaware law provides that unless further restricted by the certificate of incorporation, a corporation may declare and pay dividends (a) out of surplus (as defined under Delaware law), or (b) if no surplus exists, out of net profits for the fiscal year in which the dividend is declared and/or the preceding fiscal year, but only if the capital of the corporation (as defined under Delaware law) is greater than or equal to the aggregate amount of the capital represented by the issued and outstanding stock of all classes having a preference upon the distribution of assets. The Delaware Certificate of Incorporation and Delaware Bylaws will not vary from Delaware law, and will provide that shareholders are entitled to receive dividends when, as and if declared by the board of directors from the assets of funds of First Interstate-Delaware legally available therefor.


Anti-Takeover Statute
Business Combination Statute						Business Combination Statute
Montana law does not contain any “anti-takeover” provisions imposing specific requirements or restrictions on transactions between a corporation and its significant shareholders.						Delaware law provides that a corporation that is listed on a national securities exchange or that has more than 2,000 shareholders is not permitted to engage in a business combination with any interested shareholder for three years after the person became an interested shareholder, unless (a) before the person became an interested shareholder, the board of directors approved either the transaction resulting in a person becoming an interested shareholder or the business combination, (b) upon consummating the transaction which resulted in the person becoming an interested shareholder, the interested shareholders owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced (excluding shares owned by persons who are both officers and directors of the corporation, and shares held by certain employee stock ownership plans), or (c) on or after the date the person becomes an interested shareholder, the business combination is approved by the board of directors and at an annual or special meeting of shareholders by the affirmative vote of at least sixty‑six and two-thirds percent (66.67%) of the corporation’s outstanding voting stock which is not owned by the interested shareholder. An interested shareholder generally is a person who owns 15% or more of the outstanding shares of a corporation’s voting stock. These provisions do not apply, among other exceptions, if (i) the corporation’s original certificate of incorporation contains a provision expressly electing not to be governed by these provisions or (ii) the corporation, by action of its shareholders, adopts an amendment to its certificate of incorporation or bylaws expressly electing not to be governed by these provisions, which action must be approved by the affirmative vote of a majority of the shares entitled to vote. The Delaware Certificate of Incorporation will contain a provision opting out of this Delaware law, with the result that the “anti-takeover” provisions will not be applicable and the rights of the Delaware shareholders will be substantially identical to the Montana shareholders in this respect.


	2022		2021
Audit fees (1)	$	1,805,000	$	1,018,000
Audit-related fees (2)	19,300		105,700
Tax fees	—		—
All other fees (3)	—		34,125


(1)			Audit fees consist of fees for the audit of the financial statements included in our Annual Report and reviews of the Quarterly Reports on Form 10-Q, including procedures related to acquisitions.
(2)			Audit-related fees for 2022 and 2021 consist of fees for review of our registration statement on Form S-4 filed with SEC on November 4, 2021, our Form S-4/A filed with the SEC on December 14, 2021, and our Form S-4/Acq Plan filed with the SEC on April 7, 2022.
(3)			Includes non-prohibited services provided by our principal accountant not applicable to the first three categories.


(1)			Includes 257,508 shares over which Mr. Heyneman reports shared voting and dispositive power. Mr. Heyneman disclaims beneficial ownership, except to the extent of his pecuniary interest therein, over 1,343,000 of the shares reported as beneficially owned indirectly by Mr. Heyneman, which shares are reported as indirectly beneficially owned, in the aggregate, through a limited partnership and several family trusts. Mr. Heyneman has caused a trust through which he reports indirect beneficial ownership in the shares to pledge as collateral security for a loan (line of credit) from Western Security Bank 11,700 shares of Class A common stock.
(2)			Includes 376,989 shares over which Mr. Scott reports shared voting and dispositive power. Mr. Scott has caused a trust through which he reports indirect beneficial ownership in the shares to pledge as collateral security for a loan from Western Security Bank 395,000 shares of Class A common stock.
(3)			Mr. Scott has caused a trust through which he reports indirect beneficial ownership in the shares to pledge as collateral security for a loan from Western Security Bank 380,000 shares of Class A common stock.
(4)			Based in part on an amendment to Schedule 13D filed with the SEC on March 31, 2022 (the “Schedule 13D/A”), as well as reports filed pursuant to Section 16 of the Exchange Act. As disclosed in the Schedule 13D/A, the Scott Family FIBK Shareholder Group is composed of John M. Heyneman, Jr., Susan Heyneman, Julie Scott Rose, Homer Scott, Jr., James R. Scott, James R. Scott, Jr., Jeremy P. Scott, Jonathan R. Scott, Risa K. Scott, and several trusts, foundations, entities and other shareholders of the Company affiliated with such Scott family members which are identified in the Schedule 13D/A and which signed with such family members a Stockholders’ Agreement with the Company dated September 15, 2021. The foregoing family members report sole or shared voting and dispositive power over all of such shares.
(5)			Based solely on an amendment to Schedule 13G filed with the SEC on February 9, 2023 (the “Schedule 13G/A”). As disclosed in the Schedule 13G/A, this includes 0 shares over which the Vanguard Group has sole voting power, 62,799 shares over which the Vanguard Group has shared voting power, 7,734,827 shares over which the Vanguard Group has sole dispositive power, and 150,689 shares over which the Vanguard Group has shared dispositive power. The address for the Vanguard Group is 100 Vanguard Blvd., Malvern, PA 19355.
(6)			Based solely on an amendment to Schedule 13G filed with the SEC on February 1, 2023 (the “Schedule 13G/A”). As disclosed in the Schedule 13G/A, this includes 6,295,934 shares over which BlackRock, Inc. (“BlackRock”) has sole voting power and 6,537,202 shares over which BlackRock has sole dispositive power. The address for BlackRock is 55 East 52nd Street New York, New York 10055.