UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
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DATE OF REPORT (Date of earliest event reported): January 24, 2007
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FIRST MERCHANTS CORPORATION
(Exact Name of Registrant as Specified in its Charter)
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INDIANA 0-17071 35-1544218
(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
200 East Jackson Street
P.O. Box 792
Muncie, IN 47305-2814
(Address of Principal Executive Offices, including Zip Code)
(765) 747-1500
(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 (17 CFR
230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 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.
(e) On October 12, 2006, the Compensation and Human Resources Committee
(the "Committee") of the Board of Directors (the "Board") of First Merchants
Corporation (the "Corporation") approved the establishment of a Defined
Contribution Supplemental Executive Retirement Plan (the "Plan") for the purpose
of providing compensation for a select group of management and other highly
compensated employees of the Corporation and designated Michael C. Rechin as the
sole initial participant in the Plan. The Board confirmed the Committee's action
at a meeting held on October 24, 2006. On January 26, 2007, the definitive Plan
document was finalized and executed by the Corporation, and Mr. Rechin executed
a Participation Agreement accepting the Committee's designation of Mr. Rechin as
a participant. Mr. Rechin is the current Executive Vice President and Chief
Operating Officer of the Corporation and on April 24, 2007, will become the
President and CEO of the Corporation. A copy of the Plan is attached hereto as
Exhibit 10.1, and a copy of Mr. Rechin's Participation Agreement is attached as
Exhibit 10.2.
The Plan provides that a certain percentage of each participant's salary and
bonus will be credited to a deferred benefit account established for the
participant, contingent upon the participant having made sufficient
contributions to the Corporation's Retirement and Income Savings Plan to be
entitled to the maximum matching employer contributions under that plan. The
amount of the contribution and the date upon which each participant will begin
participating in the Plan will be set forth in the Participation Agreement to be
executed by each participant.
The Corporation intends to establish a "rabbi trust" in connection with the Plan
and to make contributions to the trust to provide itself with a source of funds
to assist it in meeting its liabilities under the Plan. However, the
Corporation's obligations under the Plan will remain an unsecured, unfunded
promise to pay benefits to the participants in accordance with the Plan's
provisions.
The interest of each participant in the value of his or her contribution account
vests upon the earlier of: (a) the participant's death while employed by the
Corporation; (b) the participant's disability while employed by the Corporation;
(c) involuntary termination of the participant's status as an employee of the
Corporation, other than for cause; (d) a benefit becoming payable to the
participant under a Change of Control Agreement with the Corporation; or (e)
completion by the participant of five (5) consecutive years of employment as an
employee of the Corporation after becoming a participant in the Plan. Upon the
occurrence of any of these events, the participant's interest in his or her
contribution account becomes fully vested and nonforfeitable.
The amounts accrued under each participant's accounts become payable upon: (a)
the participant's death; (b) the participant's disability; or (c) if vested, the
participant's separation from service as an employee of the Corporation, with
the initial payment being delayed six (6) months if payment is made on account
of the participant's separation from service. The amount will be payable to the
participant by the Corporation in thirty-six (36) monthly installments.
Item 9.01. Financial Statements and Exhibits.
(c) (10.1) Defined Contribution Supplemental Executive Retirement Plan,
dated as of January 1, 2006.
(10.2) Participation Agreement of Michael C. Rechin, dated
January 26, 2007.
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.
DATE: January 26, 2007.
FIRST MERCHANTS CORPORATION
By: /s/ Michael L. Cox
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Michael L. Cox,
President and CEO
EXHIBIT INDEX
10.1 Defined Contribution Supplemental Executive Retirement Plan,
dated as of January 1, 2006.
10.2 Participation Agreement of Michael C. Rechin, dated
January 26, 2007.
Exhibit 10.1
FIRST MERCHANTS CORPORATION
DEFINED CONTRIBUTION
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
Effective January 1, 2006
FIRST MERCHANTS CORPORATION
DEFINED CONTRIBUTION
SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
First Merchants Corporation (the "Employer") hereby establishes the
First Merchants Corporation Defined Contribution Supplemental Executive
Retirement Plan (the "Plan"), effective as of January 1, 2006.
Article I
Purpose of the Plan
This Plan is a non-qualified retirement plan established for the
purpose of providing deferred compensation for a select group of management or
highly compensated Employees and is intended to be an unfunded plan within the
meaning of the Employee Retirement Income Security Act of 1974 ("ERISA") and the
Internal Revenue Code of 1986, as amended.
Article II
Definitions
2.1 Change of Control Agreement. A "Change of Control Agreement"
shall mean a change of control agreement in effect between an Executive and
the Employer.
2.2 Code. The "Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time.
2.3 Committee. The "Committee" shall mean the Employer's Compensation
and Human Resources Committee.
2.4 Compensation. "Compensation" shall mean, with respect to each
Executive, all salary and bonuses required to be included in such Executive's
gross income for federal income tax purposes (before required withholdings)
payable to the Executive for services rendered to the Employer or a subsidiary
of the Employer during the Plan Year in question, plus all elective deferrals
(as defined in Section 402(g)(3) of the Code), all amounts that are contributed
or deferred by the Employer at the election of the Executive to any plan of the
Employer for the Plan Year and that are not includible in the Executive's gross
income by reason of Section 125 of the Code, and all elective amounts that are
not includible in gross income by reason of Section 132(f)(4) of the Code;
provided, however, "Compensation" shall not include any special or one-time
bonus or similar payments, including, without limitation, payments made by the
Employer to the Executive on account of severance or termination of employment
pursuant to a Change of Control Agreement or otherwise.
2.5 Deferred Benefit Account. A "Deferred Benefit Account" shall mean
the account being administered for the benefit of an Executive pursuant to the
provisions of the Plan. Such account shall consist of amounts credited to such
account, adjusted for investment gain or loss.
2.6 Disability or Disabled. "Disability" or "Disabled" shall mean any
medically determinable physical or mental impairment that can be expected to
result in death or can be expected to last for a continuous period of not less
than 12 months, by reason of which the Executive is (1) unable to engage in any
substantial gainful activity, or (2) receiving income replacement benefits for a
period of not less than three months under the Employer's accident and health
plan covering the Executive.
2.7 Executive. An "Executive" shall mean a key executive Employee who
is designated to participate in the Plan under Article III.
2.8 Participation Agreement. A "Participation Agreement" shall mean the
agreement executed by an Executive upon being designated to participate in the
Plan. The Participation Agreement shall be an integral part of the Plan with
respect to the Executive who executes the Participation Agreement.
2.9 Retirement Plan. The "Retirement Plan" shall mean the First
Merchants Corporation Retirement and Income Savings Plan.
2.10 Separation from Service. "Separation from Service" shall mean
separation from service with the Employer as defined in IRS Prop. Reg.
ss.1.409A-1(h), or another IRS regulation adopted hereafter in place of this
proposed regulation.
2.11 Vesting. "Vesting" shall mean the protection of the Executive's
Deferred Benefit Account balance from forfeiture, as provided in Article VII.
The following terms shall have the same meanings as they have under the
Retirement Plan: "Employee," "Plan Year," "Employer Contribution" and "Pre-Tax
Contribution."
Article III
Designation of Executives Participating in the Plan
The Committee shall have the sole discretion, from time to time, to
designate Employees to participate in the Plan as covered Executives. This
designation shall be by resolution of the Committee and shall be limited to
management or highly compensated Employees who are participating in the
Retirement Plan and whose Compensation exceeds the annual compensation limit
under Section 401(a)(17) of the Code. Each Executive so designated shall execute
a Participation Agreement and shall become a participant as of the date set
forth in such Participation Agreement.
Article IV
Contributions; Crediting Accounts
4.1 Non-Contributory Plan. The Executive shall not be permitted to
make contributions under this Plan.
4.2 Credits to Executive's Deferred Benefit Account. With respect to
each Executive, for each Plan Year (or portion thereof) in which the Executive:
(a) is a participant in the Plan; and (b) has made sufficient Pre-Tax
Contributions under the Retirement Plan for such Plan Year to be entitled to the
maximum matching Employer Contribution under said Retirement Plan for that year;
the Employer shall credit the percentage of such Executive's Compensation for
such Plan Year to the Executive's Deferred Benefit Account as shall be provided
in the Executive's Participation Agreement. The Employer shall credit the amount
to each Executive's Deferred Benefit Account determined in accordance with this
Section 4.2 for each Plan Year on the last day of such year; provided, however,
if an Executive's participation ceases prior to the end of a Plan Year by reason
of the Executive's death, Disability or Separation from Service entitling the
Executive to benefit payments in accordance with Article VIII of the Plan, the
amount shall be credited as soon as administratively feasible but in no event
more than thirty (30) days following such event.
Article V
Unfunded Plan
Except as may be provided in a "rabbi trust" agreement which may be
established by the Employer in connection with this Plan, (a) the Executive, his
or her designated beneficiary and any other person or persons having or claiming
a right to payment of benefits hereunder, or to any interest under this Plan,
shall rely solely on the unsecured promise of the Employer, and (b) nothing
herein shall be construed to give the Executive, his or her designated
beneficiary or any other person or persons any right, title, interest or claim
in or to any specific asset, fund, reserve, account or property of any kind
whatsoever owned by the Employer or in which it may have any right, title or
interest now or in the future, but the Executive shall have the right to enforce
his or her claim against the Employer in the same manner as any unsecured
creditor. The rights of a covered Executive under the Plan are not subject to
anticipation, alienation, sale, transfer, assignment, pledge, encumbrance,
attachment or garnishment by creditors of the Executive or the Executive's
beneficiary.
Article VI
Investment of Deferred Benefit Account
The Employer or the trustee of any "rabbi trust" established by the
Employer may provide an investment account or accounts (the "Investment
Account(s)") in which the Executive may request to have all or portions of the
Deferred Benefit Account invested. Such Investment Account(s) shall allow the
Executive to request that the Deferred Benefit Account be allocated among such
investment options as the Employer or the trustee may, in its sole discretion,
make available under this Plan, including, without limitation, investment
options that are available to Executives in the Retirement Plan as well as under
insurance and annuity policies. This requested investment allocation shall be
made on such forms and pursuant to such procedures as may be prescribed by the
Committee or the trustee. The Employer and the trustee shall be under no
obligation to invest the Deferred Benefit Account in the manner requested by the
Executive. The Deferred Benefit Account shall reflect all gain or loss in the
Investment Account(s), reduced by any expenses incurred by the Investment
Account(s).
Article VII
Vesting
The interest of the Executive in the value of his or her Deferred
Benefit Account shall fully vest in the Executive (or his or her beneficiary in
the event of the Executive's death while participating in the Plan) and become
nonforfeitable in the event of: (a) the Executive's death; (b)the Executive's
Disability; (c) involuntary termination of the Executive's status as an
Employee, other than for Cause (as defined in the Executive's Change of Control
Agreement); (d) a benefit becoming payable to the Executive under his or her
Change of Control Agreement; or (e) completion by the Executive of five (5)
consecutive years of employment as an Employee after becoming a participant in
the Plan.
Article VIII
Payment of Benefits
The Employer shall pay the Executive (or his or her beneficiary in the
event of the Executive's death) an amount equal to the value of his or her
vested Deferred Benefit Account as a benefit under this Plan, in thirty-six (36)
monthly installments, commencing within thirty (30) days after any of the
following dates: (a) the date of the Executive's death; (b) the date the
Executive is determined to be Disabled; (c) the date of the Executive's
Separation from Service; provided, however, if the benefit is payable on account
of the the Executive's Separation from Service, the initial payment to the
Executive shall be delayed for six (6) months after such Separation from
Service. Each monthly payment shall be calculated on the basis of the value of
the Executive's vested Deferred Benefit Account, determined as of the date of
such calculation, divided by a fraction, the numerator of which is one (1) and
the denominator of which is the number of monthly payments remaining to be paid
(e.g., 1/36, 1/35, etc. of the Executive's vested Deferred Benefit Account),
except that, if the benefit is payable on account of the the Executive's
Separation from Service, the initial payment (but not the remaining thirty (30)
payments) to the Executive shall be an amount equal to one-sixth (1/6) of the
value of the Executive's vested Deferred Benefit Account, determined as of the
date of such calculation.
Article IX
Designation of Beneficiary
The Executive may designate the person(s) to receive the benefit
payable under this Plan if the Executive dies before receiving the full amount
of such benefit. If such designation is not made, or if no designated
beneficiary is then living, such benefit shall be paid to the Executive's
spouse, if then living, or if not, to the Executive's descendants, per stirpes,
who are then living, or if there are no such descendants then living, to the
Executive's estate.
Article X
Amendment or Termination of Plan
This Plan may be amended or terminated at any time by the Committee
without the consent of the Executive or his beneficiary(ies) provided that the
Executive does not lose the right to any vested Deferred Benefit Account
accruing prior to the amendment or termination.
Article XI
Administration of the Plan
The Plan shall be administered by the Committee, which shall have sole
authority to construe and interpret the Plan and issue such rules and
regulations as it deems appropriate. The Committee may appoint or employ
individuals to assist in the administration of the Plan and any other agents it
deems advisable, including legal and actuarial counsel. The Committee's
interpretations, determinations, rules and regulations, and calculations shall
be final and binding on all persons and parties concerned. The foregoing
notwithstanding, the Committee's discretion under this Article XI is limited by
the provisions of Section 409A of the Code and the regulations thereunder. In no
event shall the Committee construe or interpret the Plan or establish any rules
or regulations that are contrary to or inconsistent with such Code Section
and/or regulations.
Article XII
Claims
If the Executive (or to his or her beneficiary in the case of the
Executive's death) desires a review of any benefit determination made by the
Committee under this Plan, he or she shall follow the claims review procedure
described in the Retirement Plan (except that the review shall be by the
Committee rather than the administrative committee under the Retirement Plan).
Article XIII
No Employment Agreement Created
No provision of this Agreement shall be deemed to restrict or limit any
existing employment agreement by and between the Employer and an Executive, nor
shall any provisions herein create specific employment rights to an Executive
nor limit the right of the Employer to discharge an Executive with or without
cause. Similarly, no provision shall limit an Executive's rights to voluntarily
sever his or her employment at any time.
Article XIV
Binding Effect and Governing Law
This Plan shall be binding upon each Executive and the Executive's
spouse, beneficiaries, heirs, executors, administrators, personal
representatives, successors and assigns, and upon the Employer and its
successors and assigns. Excepted as preempted by ERISA or any other applicable
federal law, the Plan shall be construed, enforced and administered , and its
validity shall be determined, in accordance with the laws of the State of
Indiana.
Article XV
Interpretation
Words and phrases herein shall be construed as in the singular or
plural as masculine, feminine or neuter gender as appropriate. The headings used
herein are for organizational purposes only and shall have no determinative
effect upon the rights, interests, and/or duties created in this Plan.
This Plan was adopted by the Committee on October 12, 2006, effective
as of January 1, 2006, under authority granted by the Employer's Board of
Directors.
FIRST MERCHANTS CORPORATION
By:/s/ Michael L. Cox
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Michael L. Cox
President and CEO
Exhibit 10.2
FIRST MERCHANTS CORPORATION
PARTICIPATION AGREEMENT
Whereas, the Compensation and Human Resources Committee (the
"Committee") of First Merchants Corporation (the "Employer") adopted the First
Merchants Corporation Defined Contribution Supplemental Executive Retirement
Plan (the "Plan") on October 12, 2006, effective as of January 1, 2006; and
Whereas, Michael C. Rechin (the "Executive") is the Executive Vice
President and Chief Operating Officer of the Employer, and, by resolution of the
Committee on October 12, 2006, the Executive was designated to participate in
the Plan, effective as of January 1, 2006; and
Whereas, said resolution provided that, so long as the Executive
continues as a participant in the Plan, the Employer shall credit twelve percent
(12%) of the Executive's Compensation for each Plan Year to the Executive's
Deferred Benefit Account.
Now, therefore, by signing this Participation Agreement, the Executive
accepts the Committee's designation of the Executive as a participant in the
Plan and acknowledges that he has read and understands the terms and provisions
of the Plan document(s). He further acknowledges that he understands: (a) that,
in order to be eligible for a credit to his Deferred Benefit Account for a Plan
Year, he must make sufficient Pre-Tax Contributions under the First Merchants
Corporation Retirement and Income Savings Plan for such Plan Year to be entitled
to the maximum matching Employer Contribution under said Retirement Plan for
that year; (b) that benefits will be paid pursuant to the Plan only under the
specific circumstances described therein; and (c) that he is a general creditor
of the Employer and, except as may be provided in a "rabbi trust" agreement
which may be established by the Employer in connection with this Plan, he has no
interest in specific assets owned by the Employer.
The Executive hereby designates the following beneficiary or
beneficiaries in accordance with the provisions of Article IX of the Plan:
Debra Lynn Rechin
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If the above named beneficiary is not living when the benefit is to be made
under the Plan, the Executive hereby designates the following contingent
beneficiary or beneficiaries:
Kyle Rechin, Emily Rechin, Courtney Rechin
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Dated this 29th day of January, 2007.
/s/Michael C. Rechin /s/Kim Ellington
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Michael C. Rechin Kim Ellington
Executive Plan Administrator