Registration Statement No. 33-_____________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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FIRST MERCHANTS CORPORATION
(Exact name of registrant as specified in its charter)
INDIANA 35-1544218
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
200 East Jackson Street
Muncie, Indiana 47305
(Address of Principal Executive Offices)
FIRST MERCHANTS CORPORATION
1999 LONG-TERM EQUITY INCENTIVE PLAN
(Full title of the plan)
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Larry R. Helms With a copy to:
Senior Vice President David R. Prechtel, Esq.
First Merchants Corporation Bingham Summers Welsh &
200 East Jackson Street Spilman
Muncie, Indiana 47305 2700 Market Tower
10 West Market Street
Indianapolis, Indiana 46204
(Name and address of agent for service) (317) 635-8900
765-747-1530
(Telephone number, including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
- ------------------------------------------------------------------------------------------------
Title of each class Amount Proposed Proposed Amount of
of securities to be maximum offering maximum aggregate registration
to be registered registered(1) price per unit(2) offering price(2) fee
- ------------------------------------------------------------------------------------------------
Common Stock,
7 no par value 600,000 Shares $23.6875 $14,212,500 $3,952.00
(1) In addition, pursuant to Rule 416(c) under the Securities Act of 1933, as
amended (the "Act") this Registration Statement also covers an
indeterminate amount of interests to be offered or sold pursuant to the
employee benefit plan described herein. Furthermore, pursuant to Rule 16(b)
of the Act, there are being registered such additional shares as may be
issuable as a result of stock splits and stock dividends on, and similar
capital changes to, the registered securities.
(2) The registration fee has been calculated pursuant to Rule 457(c) and (h) on
the basis of $23.6875 per share, which was the last sale reported for First
Merchants Corporation's common stock by the NASDAQ National Market System
on June 1, 1999.
2
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
ITEM 1. PLAN INFORMATION.
The information required by Part I to be contained in this Item is omitted from
this Registration Statement in accordance with the Introductory Note to Part I
of Form S-8.
ITEM 2. REGISTRATION INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION.
The information required by Part I to be contained in this Item is omitted from
this Registration Statement in accordance with the Introductory Note to Part I
of Form S-8.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following information heretofore filed with the Securities Exchange
Commission ("Commission") pursuant to the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), is incorporated herein by reference:
(a) First Merchants Corporation's (the "Registrant") Annual Report on Form
10-K for the fiscal year ended December 31, 1998, File No. 0-17071.
(b) All other reports filed by the Registrant pursuant to Section 13(a) or
15(d) of the Exchange Act since the end of the fiscal year covered by the Annual
Report referred to in (a) above.
(c) The description of the Registrant's Common Stock contained in the
Registrant's Registration Statement on Form 8-A, and all amendment and reports
filed for the purpose of updating such description, File No. 0-17071
All documents field by the Registrant or the First Merchants Corporation 1999
Long-Term Equity Incentive Plan ("Plan") pursuant to Sections 13(a), 13(c), 14,
and 15(d) of the Exchange Act after the date of this Registration Statement and
prior to the filing of a post-effective amendment indicating that all of the
securities offered hereby have been sold or deregistering all such securities
then remaining unsold, shall be deemed to be incorporated by reference in this
Registration Statement and to be a part hereof from the date of filing of those
documents.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
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ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEMS 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Indiana Business Corporation Law ("IBCL"), the provisions of which govern
the Registrant, empowers an Indiana corporation to indemnify present and former
directors, officers, employees, or agents or any person who may have served at
the request of the corporation as a director, officer, employee, or agent of
another corporation ("Eligible Persons") against liability incurred in any
proceeding, civil or criminal, in which the Eligible Person is made a party by
reason of being or having been in any such capacity, or arising out of his
status as such, if the individual acted in good faith and reasonably believed
that (a) the individual was acting in the best interests of the corporation, or
(b) if the challenged action was taken other than in the individual's official
capacity as an officer, director, employee or agent, the individual's conduct
was at least not opposed to the corporation's best interests, or (c) if in a
criminal proceeding, either the individual had reasonable cause to believe his
conduct was lawful or no reasonable cause to believe his conduct was unlawful.
The IBCL further empowers a corporation to pay or reimburse the reasonable
expenses incurred by an Eligible Person in connection with the defense of any
such claim, including counsel fees; and, unless limited by its Articles of
Incorporation, the corporation is required to indemnify an Eligible Person
against reasonable expenses if he is wholly successful in any such proceeding,
on the merits or otherwise. Under certain circumstances, a corporation may pay
or reimburse an Eligible Person for reasonable expenses prior to final
disposition of the matter. Unless a corporation's articles of incorporation
otherwise provide, an Eligible Person may apply for indemnification to a court
which may order indemnification upon a determination that the Eligible Person is
entitled to mandatory indemnification for reasonable expenses or that the
Eligible Person is fairly and reasonably entitled to indemnification in view of
all the relevant circumstances without regard to whether his actions satisfied
the appropriate standard of conduct.
Before a corporation may indemnify any Eligible Person against liability or
reasonable expenses under the IBCL, a quorum consisting of directors who are not
parties to the proceeding must (1) determine that indemnification is permissible
in the specific circumstances because the Eligible Person met the requisite
standard of conduct, (2) authorize the corporation to indemnify the Eligible
Person and (3) if appropriate, evaluate the reasonableness of expenses for which
indemnification is sought. If it is not possible to obtain a quorum of
uninvolved directors, the foregoing action may be taken by a committee of two or
more directors who are not parties to the proceeding, special legal counsel
selected by the Board or such a committee, or by the shareholders of the
corporation.
In addition to the foregoing, the IBCL states that the indemnification it
provides shall not be deemed exclusive of any other rights to which those
indemnified may be entitled under any provision of the articles of incorporation
or bylaws, resolution of the board of directors or shareholders, or any other
authorization adopted after notice by a majority vote of all the voting shares
then issued and outstanding. The IBCL also empowers an Indiana corporation to
purchase
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and maintain insurance on behalf of any Eligible Person against any liability
asserted against or incurred by him in any capacity as such, or arising out of
his status as such, whether or not the corporation would have had the power to
indemnify him against such liability.
The Registrant's Articles of Incorporation provide that the Registrant will
indemnify any person who is or was a director, officer, employee or agent of the
Registrant or of any other corporation for which he is or was serving in any
capacity at the request of the Registrant against all liability and expense that
may be incurred in connection with or resulting from or arising out of any
claim, action, suit or proceeding with respect to which such director, officer
or employee is wholly successful or acted in good faith in a manner he
reasonably believed to be in, or not opposed to, the best interests of the
Registrant or such other corporation and, with respect to any criminal action or
proceeding, had no reasonable cause to believe that his conduct was unlawful. A
director, officer, employee or agent of the Registrant is entitled to be
indemnified as a matter of right with respect to those claims, actions, suits or
proceedings where he has been wholly successful. In all other cases, such
director, officer, employee or agent will be indemnified only if the Board of
Directors of the Registrant or independent legal counsel finds that he has met
the standards of conduct set forth above.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
The following exhibits are being filed as part of this Registration Statement:
EXHIBIT NUMBER
ASSIGNED IN
REGULATION S-K EXHIBIT
ITEM 601....... NUMBER DESCRIPTION OF EXHIBIT
(4)............... 4.01 DESCRIPTION OF THE REGISTRANT'S
COMMON STOCK (INCORPORATED BY
REFERENCE TO THE REGISTRANT'S
REGISTRATION STATEMENT ON FORM
8-A AND ALL AMENDMENTS AND REPORTS
FILED FOR THE PURPOSE OF UPDATING
SUCH DESCRIPTION, FILE NO. 0-17071).
4.02 FIRST MERCHANTS CORPORATION 1999
LONG-TERM EQUITY INCENTIVE PLAN.
(5)............... 5.01 OPINION OF BINGHAM SUMMERS WELSH &
SPILMAN
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(15) NOT APPLICABLE
(23).............. 23.01 CONSENT OF OLIVE, LLP, INDEPENDENT
PUBLIC ACCOUNTANTS
23.02 CONSENT OF BINGHAM SUMMERS WELSH
& SPILMAN (PROVIDED IN EXHIBIT 5.01)
(24) 24.01 POWER OF ATTORNEY (SEE SIGNATURE
PAGE)
(99) NOT APPLICABLE
ITEM 9. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement.
Provided, however, that paragraphs (l)(i) and (l)(ii) shall not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the Registrant pursuant to Section 13 or Section 15(d) of the
Exchange Act that are incorporated by reference in the registration statement.
(2) That for the purpose of determining any liability under the Securities
1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
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(4) That, for purposes of determining any liability under the Securities
Act of 1933, each filing of the Registrant's annual report pursuant to Section
13(a) or Section 15(d) of the Exchange Act (and, where applicable, each filing
of an employee benefit plan's annual report pursuant to Section 15(d) of the
Exchange Act) that is incorporated by reference in the registration statement
shall be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act of
1933 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Commission such indemnification is
against public policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other
than the payment by the Registrant of expenses incurred or paid by a director,
officer or controlling person of the Registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the Registrant will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
SIGNATURES
Pursuant to the requirements of Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, hereunto duly
authorized, in the City of Muncie, State of Indiana, on June 3, 1999.
FIRST MERCHANTS CORPORATION
By: /s/ Michael L. Cox
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Michael L. Cox, President and Chief Executive Officer
POWER OF ATTORNEY
Know all men by these presents, that each person whose signature appears
below constitutes and appoints Michael L. Cox and Larry R. Helms and each or any
of them (with full power to act alone), his or her true and lawful
attorneys-in-fact and agents with full power of substitution and resubstitution,
for him or her and in his or her name, place and stead, in any and all
capacities, to sign any and all amendments to this Registration Statement, and
to file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto those
attorneys-in-fact and agents full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he or she might or could do in
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person, hereby ratifying and confirming all that those attorneys-in-fact and
agents, or their substitutes, may do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed on June 3, 1999 by the following persons
in the capacities indicated:
Signature Capacity
With Registrant
/s/ Michael L. Cox President, Chief Executive Officer and Director
- -------------------------- (Principal Executive Officer)
Michael L. Cox
/s/ James L. Thrash Senior Vice President, Chief Financial Officer
- -------------------------- (Principal Financial and Accounting Officer)
James L. Thrash
/s/ Stephan S. Anderson Chairman of the Board of Directors
- --------------------------
Stephan S. Anderson
/s/ Thomas B. Clark Director
- --------------------------
Thomas B. Clark
/s/ David A. Galliher Director
- --------------------------
David A. Galliher
/s/ John E. Worthen Director
- --------------------------
John E. Worthen
/s/ Norman M. Johnson Director
- --------------------------
Norman M. Johnson
/s/ George S. Sissel Director
- --------------------------
George S. Sissel
/s/ Robert M. Smitson Director
- --------------------------
Robert M. Smitson
/s/ Frank A. Bracken Director
- --------------------------
Frank A. Bracken
/s/ Ted J. Mongtomery Director
- --------------------------
Ted J. Mongtomery
/s/ Michael D. Wickersham Director
- --------------------------
Michael D. Wickersham
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Pursuant to the requirements of the Securities Act of 1933, the Members of
the Compensation and Human Resources Committee (i.e. the plan administrator) has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized in the City of Muncie, State of Indiana,
on June 3, 1999.
FIRST MERCHANTS CORPORATION
1999 LONG-TERM EQUITY INCENTIVE PLAN
By: /s/ Robert M. Smitson
---------------------------------
Robert M. Smitson
By: /s/ Frank A. Bracken
---------------------------------
Frank A. Bracken
By: /s/ Thomas B. Clark
---------------------------------
Thomas B. Clark
By: /s/ Norman M. Johnson
---------------------------------
Norman M. Johnson
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EXHIBIT 4.02
FIRST MERCHANTS CORPORATION
1999 LONG-TERM EQUITY INCENTIVE PLAN
ARTICLE I
ESTABLISHMENT AND PURPOSE
Section 1.01. Establishment and Term of Plan. First Merchants Corporation,
an Indiana corporation (the "Company"), hereby establishes the First Merchants
Corporation 1999 Long-Term Equity Incentive Plan (the "Plan"), effective as of
April 14, 1999, subject to the approval of the Plan at the Company's 1999 annual
meeting of shareholders by the holders of a majority of the shares of the
Company's common stock present and voting at that meeting in person or by proxy.
Section 1.02. Purpose. The Plan is designed to promote the interests of the
Company, its subsidiaries, and its shareholders by providing stock-based
incentives to selected Employees, Non-Employee Directors, Subsidiary Directors
and Advisory Directors who are expected to contribute materially to the success
of the Company and its subsidiaries. The purpose of the Plan is to provide a
means of rewarding performance and to provide an opportunity to increase the
personal ownership interest of Employees, Non-Employee Directors, Subsidiary
Directors and Advisory Directors in the continued success of the Company. The
Company believes that the Plan will assist its efforts to attract and retain
quality Employees, Non-Employee Directors, Subsidiary Directors and Advisory
Directors.
ARTICLE II
ADMINISTRATION
Section 2.01. Administrative Committee. The Plan shall be administered by
the Committee, which shall serve at the pleasure of the Board of Directors. The
Committee shall have full authority to administer the Plan, including authority
to interpret and construe any provision of the Plan and to adopt such rules and
regulations for administering the Plan as it may deem necessary to comply with
the requirements of the Plan or any applicable law.
Section 2.02. Powers of the Committee. The Committee shall, subject to the
terms of this Plan, have the authority to: (i) select the eligible Employees,
Subsidiary Directors and Advisory Directors who shall receive Awards, (ii) grant
Awards, (iii) determine the types and sizes of Awards to be granted to
Employees, Subsidiary Directors and Advisory Directors under the Plan (but not
to Non-Employee Directors, who shall receive Director Options in accordance with
Article VI of this Plan), (iv) determine the terms, conditions, vesting periods,
and restrictions applicable to Awards (other than Director Options), (v) adopt,
alter, and repeal administrative rules and practices governing this Plan, (vi)
interpret the terms and provisions of this Plan and any Awards granted under
this Plan, (vii) prescribe the forms of any Award
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Agreements or other instruments relating to Awards, and (viii) otherwise
supervise the administration of this Plan. The Committee may delegate any of its
authority to any other person or persons that it deems appropriate with respect
to Awards granted to Employees who are not officers of the Company.
Section 2.03. Actions of the Committee. All actions taken and all
interpretations and determinations made in good faith by the Committee, or made
by any other person or persons to whom the Committee has delegated authority,
shall be final and binding upon all Participants, the Company, and all other
interested persons. All decisions by the Committee shall be made with the
approval of not less than a majority of its members. Members of the Committee
who are eligible for Awards may vote on any matters affecting the administration
of the Plan or the grant of any Awards pursuant to the Plan, except that no such
member shall act upon the granting of an Award to himself or herself; but any
such member may be counted in determining the existence of a quorum of the
Committee.
ARTICLE III
ELIGIBILITY
Section 3.01. Employees, Subsidiary Directors and Advisory Directors. Any
Employee of the Company or any of its Subsidiaries who is selected by the
Committee to be a Participant under the Plan, and any Subsidiary Director or
Advisory Director, shall be eligible for the grant of Awards (other than
Director Options). The selection of the Employees, Subsidiary Directors and
Advisory Directors to receive Awards (other than Director Options) shall be
within the discretion of the Committee. More than one Award may be granted to
the same Employee, Subsidiary Director or Advisory Director.
Section 3.02. Non-Employee Directors. All Non-Employee Directors are
eligible for the grant of Director Options, as provided in Article VI of this
Plan. Non-Employee Directors are not, however, eligible for the grant of any
Awards other than Director Options.
ARTICLE IV
SHARES SUBJECT TO AWARDS
Section 4.01. Number of Common Shares. The shares subject to the Awards and
other provisions of the Plan shall be the Company's authorized but unissued, or
reacquired Common Shares. The aggregate number of Common Shares that may be
subject to Awards granted under this Plan in any fiscal year shall be equal to
the sum of (i) one percent (1%) of the number of Common Shares Outstanding as of
the last day of the Company's prior fiscal year, plus (ii) the number of Common
Shares that were available for the grant of Awards, but not granted, under this
Plan in any previous fiscal year; provided that in no event will the number of
Common Shares available for the grant of Awards in any fiscal year exceed
one-and-one-half percent (1 1/2%) of the Common Shares Outstanding as of the
last day of the prior fiscal year. The
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aggregate number of Common Shares that may be issued under the Plan upon the
exercise of Incentive Stock Options is 1,200,000, as adjusted pursuant to
Section 4.02. No fractional shares shall be issued under this Plan; if
necessary, the Committee shall determine the manner in which the value of
fractional shares will be treated.
The assumption of awards granted by an organization acquired by the
Company, or the grant of Awards under this Plan in substitution for any such
awards, shall not reduce the number of Common Shares available for the grant of
Awards under this Plan. Common Shares subject to an Award that is forfeited,
terminated or canceled without having been exercised shall again be available
for grant under this Plan, subject to the limitations noted in the foregoing
paragraph of this Section 4.01.
Section 4.02. Adjustment. In the event of any change in the Common Shares
by reason of a merger, consolidation, reorganization, recapitalization or
similar transaction, or in the event of a stock split, stock dividend or
distribution to shareholders (other than normal cash dividends), spin-off or any
other change in the corporate structure of the Company, the Committee shall
adjust the number and class of shares that may be issued under this Plan, the
aggregate number of Common Shares that may be issued under the Plan upon the
exercise of Incentive Stock Options, the number and class of shares subject to
outstanding Awards, the exercise price applicable to outstanding Awards, and the
Fair Market Value of the Common Shares and other value determinations applicable
to outstanding Awards, as appropriate. All determinations made by the Committee
with respect to adjustments under this Section 4.02 shall be conclusive and
binding for all purposes of the Plan.
ARTICLE V
AWARDS
Section 5.01. Grant of Awards. Awards authorized under this Article V may
be granted pursuant to another incentive program which incorporates by reference
the terms and conditions of this Plan. Awards may be granted singly or in
combination or tandem with other Awards. Awards may also be granted in
replacement of, or in substitution for, other awards granted by the Company
whether or not such other awards were granted under this Plan; without limiting
the foregoing, if a Participant pays all or part of the exercise price or taxes
associated with an Award by the transfer of Common Shares or the surrender of
all or part of an Award (including the Award being exercised), the Committee
may, in its discretion, grant a new Award to replace the Common Shares that were
transferred or the Award that was surrendered. The Company may assume awards
granted by an organization acquired by the Company or may grant Awards in
replacement of, or in substitution for, any such awards.
Section 5.02. Types of Awards. Awards may include, but are not limited to,
the following:
(a) Director Option. A right to purchase Common Shares granted to a
Non-Employee Director pursuant to Article VI of this Plan.
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(b) Stock Award. An Award that is made in Common Shares or Restricted
Stock or that is otherwise based on, or valued in whole or in part by
reference to, the Common Shares. All or part of any Stock Award may be
subject to conditions, restrictions and risks of forfeiture, as and to the
extent established by the Committee. Stock Awards may be based on the Fair
Market Value of the Common Shares, or on other specified values or methods
of valuation, as determined by the Committee.
(c) Stock Option. A right to purchase a specified number of Common
Shares, during a specified period and at a specified exercise price, all as
determined by the Committee. A Stock Option may be an Incentive Stock
Option or a Non-Qualified Stock Option. Incentive Stock Options may only be
issued to Employees. In addition to the terms, conditions, vesting periods,
and restrictions established by the Committee in the Award Agreement,
Incentive Stock Options must comply with the requirements of Section 422 of
the Code, Section 5.03(f), and this Article V.
Section 5.03. Terms and Conditions of Awards; Agreements. Awards granted
under the Plan shall be evidenced by an Award Agreement executed by the Company
and the Participant, which shall contain such terms and be in such form as the
Committee may from time to time approve, subject to the following limitations
and conditions:
(a) Number of Shares. The Award Agreement shall state, as appropriate,
the type and total number of shares granted, and/or the type and total
number of shares with respect to which Stock Options are granted.
(b) Award Prices. The Award Agreement shall state, as applicable, the
price per share of the Common Shares with respect to which Stock Options
are issued. The price or other value shall be determined by the Committee.
For Incentive Stock Options, the exercise price shall satisfy all of the
requirements of the Code and of Section 5.03(f) of this Plan.
(c) Payment of Exercise Price; Deferral. The exercise price of a Stock
Option (other than an Incentive Stock Option), Director Option, and any
Stock Award for which the Committee has established an exercise price, may
be paid in cash, by the transfer of Common Shares, by the surrender of all
or part of an Award (including the Award being exercised), or by a
combination of these methods, as and to the extent permitted by the
Committee. The exercise price of an Incentive Stock Option may be paid in
cash, by the transfer of Common Shares, or by a combination of these
methods, as and to the extent permitted by the Committee at the time of
grant, but may not be paid by the surrender of all or part of an Award. The
Committee may prescribe any other method of paying the exercise price that
it determines to be consistent with applicable law and the purpose of this
Plan.
With the approval of the Committee, the delivery of the Common Shares,
cash, or any combination thereof subject to an Award (other than Director
Options) may be deferred, either in the form of installments or a single
future delivery. The Committee may also permit selected Participants to
defer the payment of some or all of their Awards,
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as well as other compensation, in accordance with procedures established by
the Committee to assure that the recognition of taxable income is deferred
under the Code. The Committee may also establish rules and procedures for
the crediting of interest on deferred cash payments and dividend
equivalents on Awards.
(d) Issuance of Shares and compliance with Securities Laws. The
Company may postpone the issuance and delivery of certificates representing
shares until (a) the admission of such shares to listing on any stock
exchange on which shares of the Company of the same class are then listed,
and (b) the completion of such registration or other qualification of such
shares under any state or federal law, rule or regulation as the Company
shall determine to be necessary or advisable, which registration or other
qualification the Company shall use it best efforts to complete; provided,
however, a person purchasing shares pursuant to the Plan has no right to
require the Company to register the Common Shares under federal or state
securities laws at any time. Any person purchasing shares pursuant to the
Plan may be required to make such representations and furnish such
information as may, in the opinion of counsel for the Company, be
appropriate to permit the Company, in light of the existence or
non-existence with respect to such shares of an effective registration
under the Securities Act of 1933, as amended, or any similar state statute,
to issue the shares in compliance with the provisions of those or any
comparable acts.
(e) Rights as a Shareholder. Unless otherwise provided by the Board of
Directors or the Committee, a Participant shall have rights as a
shareholder with respect to shares covered by an Award, including voting
rights or rights to dividends, only upon the date of issuance of a
certificate to him or her, and, if payment is required, only after such
shares are fully paid.
(f) Incentive Stock Options. To the extent any Award granted pursuant
to this Plan contains an Incentive Stock Option, the following limitations
and conditions shall apply to such Incentive Stock Option and the Award
Agreement relating thereto in addition to the terms and conditions provided
herein:
(i) Price. The price of an Incentive Stock Option shall be an amount
per share not less than the Fair Market Value per share of the
Common Shares on the date of granting of the option. In the case
of Incentive Stock Options granted to an Employee of the Company
who is a 10% shareholder, the option price shall be an amount per
share not less than one hundred ten percent (110%) of the Fair
Market Value per share of the Common Shares on the date of the
granting of the Incentive Stock Option.
(ii) Exercise Period. Unless terminated earlier pursuant to other
terms and provisions of the Award Agreement, the term of each
Incentive Stock Option shall expire within the period prescribed
in the Agreement relating thereto, which shall not be more than
five (5) years from the date the Incentive Stock Option is
granted if the
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Participant is a ten percent (10%) shareholder, and not more than
ten (10) years from the date the Incentive Stock Option is
granted if the Participant is not a ten percent (10%)
shareholder.
(iii) Limitation on Grants. No Incentive Stock Option shall be granted
under this Plan after April 14, 2009.
(iv) Limitation on Transferability. No Incentive Stock Option shall be
assignable or transferable except by will or under the laws of
descent and distribution. During the lifetime of a Participant,
the Incentive Stock Option shall be exercisable only by the
Participant and may not be transferred or assigned pursuant to a
qualified domestic relations order.
(v) Maximum Exercise Rule. The aggregate Fair Market Value
(determined at the time the option is granted) of the shares with
respect to which Incentive Stock Options are exercisable for the
first time by an Employee during any calendar year under all such
plans of the Company and any parent or Subsidiary of the Company
shall not exceed One Hundred Thousand Dollars ($100,000).
(g) Termination of Awards Under Certain Conditions. The Committee may
cancel any unexpired, unpaid or deferred Awards at any time, if the
Participant is not in compliance with all applicable provisions of this
Plan or with any Award Agreement, or if the Participant, whether or not he
or she is currently employed by the Company, engages in any of the
following activities without the prior written consent of the Company:
(i) Directly or indirectly renders services to or for an
organization, or engages in a business that is, in the judgment
of the Committee, in competition with the Company.
(ii) Discloses to anyone outside of the Company, or uses for any
purpose other than the Company's business, any confidential or
proprietary information or material relating to the Company,
whether acquired by the Participant during or after employment
with the Company.
The Committee may, in its discretion and as a condition to the
exercise of an Award, require a Participant to acknowledge in writing that
he or she is in compliance with all applicable provisions of this Plan and
of any Award Agreement and has not engaged in any activities referred to in
clauses (i) and (ii) above.
(h) Nontransferability. Unless otherwise determined by the Committee
and provided in the Award Agreement, (i) no Award granted under this Plan
may be
15
transferred or assigned by the Participant to whom it is granted other than
by will, pursuant to the laws of descent and distribution, or pursuant to a
qualified domestic relations order, and (ii) an Award granted under this
Plan may be exercised, during the Participant's lifetime, only by the
Participant or by the Participant's guardian or legal representative.
Section 5.04. Election to Defer Grant or Receipt of Award. Notwithstanding
any provision herein to the contrary, the Committee may provide, in any Award
Agreement or in any program granting Awards under this Plan, that the
Participant may elect to defer receipt of the Award as provided in the Award
Agreement or program.
ARTICLE VI
DIRECTOR OPTIONS
Section 6.01. Grant of Director Options.
(a) Administration. A committee formed by only those Directors other
than Non-Employee Directors shall have full authority to administer
Director Options, including authority to require that any Non-Employee
Director sign an Award Agreement as a condition of receiving a Director
Option.
(b) Granting of Director Options. Until this Plan is terminated, each
individual serving as a Non-Employee Director on July 1 in any year after
1998 shall automatically receive a Director Option, effective on such date.
Section 6.02. Number of Common Shares Subject to Each Director Option. Each
Director Option shall entitle the Non-Employee Director the right to purchase
one thousand (1,000) Common Shares on the terms and conditions specified herein.
Section 6.03. Exercise Price. The exercise price of the Common Shares
subject to each Director Option shall be the Fair Market Value of the Common
Shares at the date of grant.
Section 6.04. Date Director Options Become Exercisable. Unless otherwise
established by the Board of Directors, each Director Option shall become
exercisable in full six (6) months after the date of grant; provided, however,
all Director Options shall become exercisable in full (i) upon a Change of
Control, (ii) in accordance with the terms of Section 6.06, or (iii) upon
attainment by the Non-Employee Director of age 70.
Section 6.05. Expiration Date. Unless terminated earlier pursuant to the
terms of this Plan, each Director Option shall terminate, and the right of the
holder to purchase Common Shares upon exercise of the Director Option shall
expire, at the close of business on the tenth anniversary date of the date of
grant.
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Section 6.06. Continuous Service as a Director. No Director Option may be
exercised unless the Non-Employee Director to whom the Director Option was
granted has continued to be a Non-Employee Director from the time of grant
through the time of exercise, except as provided in Section 6.04 and this
Section 6.06.
(a) Retirement or Disability. If the service in office of a
Non-Employee Director is terminated due to the retirement or Disability of
the Non-Employee Director, the Non-Employee Director, or his legal
representative if he or she becomes incapacitated, shall have the right to
exercise the Director Option in full prior to the earlier of (i) five (5)
years after the date of his or her retirement or Disability, and (ii) the
expiration of the Director Option.
(b) Death. If the service in office of a Non-Employee Director is
terminated due to the death of the Non-Employee Director, the Non-Employee
Director's estate, executor, administrator, personal representative or
beneficiary shall have the right to exercise the Director Option in full
prior to the earlier of (i) one (1) year after the date of his or her
death, and (ii) the expiration of the Director Option.
(c) Employed by Company. If a Non-Employee Director ceases to be a
Non-Employee Director by reason of his or her employment by the Company or
his or her appointment as a Subsidiary Director or Advisory Director, the
Director Option granted to that Non-Employee Director shall be treated the
same as Non-Qualified Stock Options held by Employees, Subsidiary Directors
or Advisory Directors, whichever is applicable, and shall continue to be
exercisable prior to the expiration of the Director Option, subject to the
limitations on exercise following termination of employment, or termination
of service as a Subsidiary Director or Advisory Director, established by
the Committee pursuant to Article VIII of this Plan.
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ARTICLE VII
TAX WITHHOLDING OBLIGATIONS
Prior to the payment of an Award, the Company may withhold, or require a
Participant to remit to the Company, an amount sufficient to pay any federal,
state and local withholding taxes associated with the Award. The Committee may,
in its discretion and subject to such rules as the Committee may adopt, permit a
Participant to pay any or all withholding taxes associated with the Award in
cash, by the transfer of Common Shares, by the surrender of all or part of an
Award (including the Award being exercised), or by a combination of these
methods.
ARTICLE VIII
TERMINATION OF EMPLOYMENT OR TERMINATION OF SERVICE AS
SUBSIDIARY DIRECTOR OR ADVISORY DIRECTOR
Section 8.01. Termination of Employment. Unless the Committee provides
otherwise in the Award Agreement, if a Participant's employment with the Company
or a Subsidiary terminates for any reason other than Retirement, Disability or
death of the Participant, he or she may, but only within the thirty (30)-day
period immediately following such termination of employment, and in no event
later than the expiration date specified in the Award Agreement, exercise his or
her Award to the extent that he or she was entitled to exercise it at the date
of such termination; provided, however, if a Participant's employment is
terminated for deliberate, willful or gross misconduct, as determined by the
Board of Directors, all rights under the Award shall expire upon receipt of the
notice of such termination. The transfer of an Employee from the employ of the
Company to a Subsidiary, or vice versa, or from one Subsidiary to another
Subsidiary, shall not be deemed a termination of employment for purposes of the
Plan.
Section 8.02. Retirement or Disability. Unless the Committee provides
otherwise in the Award Agreement, if a Participant's employment with the Company
or any Subsidiary, or his or her service as a Subsidiary Director or Advisory
Director, terminates due to Retirement or Disability, the Participant (or if he
or she becomes incapacitated, the Participant's legal representative) may, but
only within the five (5)-year period immediately following such termination of
employment or termination of service, and in no event later than the expiration
date specified in the Award Agreement, exercise his or her Award to the extent
that he or she was entitled to exercise it at the date of such termination;
provided, however, if the Award being exercised under this paragraph is an
Incentive Stock Option, it may be exercised as such only during the three
(3)-month period immediately following such Retirement or Disability, and in no
event later than the expiration date specified in the Award Agreement. During
the remainder of the five (5)-year period (or, if shorter, the exercise period
specified in the Award Agreement), the option may be exercised as a
Non-Qualified Stock Option.
Section 8.03. Death. Unless the Committee provides otherwise in the Award
Agreement, if a Participant dies (whether prior to or after termination of
employment or termination of service as a Subsidiary Director or Advisory
Director) while he or she is entitled to exercise an Award, it may be exercised
within the one (1) year period immediately following
18
the Participant's death, but in no event later than the expiration date
specified in the Award Agreement, by the person or persons to whom his or her
rights to it shall pass by his or her will or by the applicable laws of descent
and distribution; provided, however, if the Award being exercised under this
paragraph is an Incentive Stock Option, it may be exercised as such only during
the three (3)-month period immediately following the Participant's death and in
no event later than the expiration date specified in the Award Agreement. During
the remainder of such one (1) year period (or, if shorter, the exercise period
specified in the Award Agreement), the option may be exercised as a
Non-Qualified Stock Option.
ARTICLE IX
CHANGE OF CONTROL
Unless and to the extent the terms and conditions of a Change of Control
agreement between the Company and a Participant provide otherwise, in the event
of a Change of Control of the Company, (i) all Stock Options then outstanding
will become fully exercisable as of the date of the Change of Control, and (ii)
all restrictions and conditions applicable to Restricted Stock and other Stock
Awards will be deemed to have been satisfied as of the date of the Change of
Control. Any such determination by the Board of Directors that is made after the
occurrence of a Change of Control will not be effective unless a majority of the
Directors then in office were in office at the beginning of a period of
twenty-four (24) consecutive months and the determination is approved by a
majority of such Directors.
ARTICLE X
AMENDMENT OF PLAN OR AWARDS
Section 10.01. Amendment, Suspension or Termination of Plan. The Board of
Directors may, from time to time, amend, suspend or terminate this Plan at any
time, and, in accordance with such amendments, may thereupon change terms and
conditions of any Awards not theretofore issued. Shareholder approval for any
such amendment will be required only to the extent necessary to satisfy the
rules of NASDAQ or any national exchange on which the Common Shares are listed,
or to satisfy any applicable federal or state law or regulation.
Section 10.02. Amendment of Outstanding Awards. The Committee may, in its
discretion, amend the terms of any Award (other than a Director Option),
prospectively or retroactively, but no such amendment may impair the rights of
any Participant without his or her consent. Shareholder approval for any such
amendment will be required only to the extent necessary to satisfy the rules of
NASDAQ or any national exchange on which the Common Shares are listed, or to
satisfy any applicable federal or state law or regulation. The Committee may, in
whole or in part, waive any restrictions or conditions applicable to, or
accelerate the vesting of, any Award (other than a Director Option).
19
ARTICLE XI
MISCELLANEOUS
Section 11.01. Governing Law. The interpretation, validity and enforcement
of this Plan will, to the extent not otherwise governed by the Code or the
securities laws of the United States, be governed by the laws of the State of
Indiana.
Section 11.02. Rights of Employees. Nothing in this Plan will confer upon any
Participant the right to continued employment by the Company or limit in any way
the Company's right to terminate any Participant's employment at will.
ARTICLE XII
DEFINITIONS
Section 12.01. Definitions. When capitalized in this Plan, unless the
context otherwise requires:
(a) "Advisory Director" means an advisory director of the Company or any of
its Subsidiaries, who is not an Employee or Director of the Company or any of
its Subsidiaries.
(b) "Award" means a grant made to a Participant pursuant to Article V of
this Plan.
(c) "Award Agreement" means a written instrument between the Company and a
Participant evidencing an Award and prescribing the terms, conditions, and
restrictions applicable to the Award.
(d) "Board of Directors" means the Board of Directors of the Company, as
constituted at any time.
(e) "Change of Control" means the first to occur of the following events:
(i) any "person," as such term is used in Sections 13(d) and 14(d) of
the Securities Exchange Act of 1934, as amended (the "Exchange
Act") other than the Company, is or becomes the "beneficial
owner" (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Company or First
Merchants Bank, National Association (the "Bank") representing
twenty-five percent (25%) or more of the combined voting power of
the Company's or Bank's then outstanding securities;
20
(ii) persons constituting a majority of the Board of Directors of the
Company or the Bank were not directors of the Company or the Bank
for at least the twenty-four (24) months preceding months;
(iii) the shareholders of the Company or the Bank approve a merger or
consolidation of the Company or the Bank with any other company,
other than (1) a merger or consolidation which would result in
the voting securities of the Company or the Bank outstanding
immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting
securities of the surviving entity) more than fifty percent (50%)
of the combined voting power of the voting securities of the
Company or the Bank or such surviving entity outstanding
immediately after such merger or consolidation or (2) a merger or
consolidation effected to implement a recapitalization of the
Company or the Bank (or similar transaction) in which no person
acquires fifty percent (50%) or more of the combined voting power
of the Company's or the Bank's then outstanding securities; or
(iv) the shareholders of the Company approve a plan of complete
liquidation of the Company or the Bank or an agreement for the
sale or disposition by the Company or the Bank of all or
substantially all of the Company's assets.
(f) "Code" means the Internal Revenue Code of 1986, as amended.
(g) "Committee" means the Compensation and Human Resources Committee of the
Board of Directors, consisting of two or more Non-Employee Directors who are
"non-employee directors" as defined in paragraph (b)(3) of Rule 16b-3.
(h) "Common Share" means a share of common stock of First Merchants
Corporation.
(i) "Common Shares Outstanding" means the total number of Common Shares
outstanding as reflected in the Company's financial statements as of the most
recent fiscal year-end.
(j) "Company" means First Merchants Corporation.
(k) "Director" means a director of the Company.
(l) "Director Option" means a right to purchase Common Shares granted to a
Non-Employee Director pursuant to Article VI.
(m) "Disabled" or "Disability" means a permanent disability as defined in
the applicable long-term disability plan of the Company; except that "Disabled"
or "Disability" with
21
respect to Director Options or Awards made to Subsidiary Directors or Advisory
Directors shall mean total and permanent disability as defined in Section
22(e)(3) of the Code.
(n) "Employee" means any individual employed by the Company or any of its
Subsidiaries, including officers and Employees who are members of the Board of
Directors of the Company or any of its Subsidiaries.
(o) "Fair Market Value" of a Common Share means the value of the share on a
particular date, determined as follows:
(i) if the stock is not listed on such date on any national
securities exchange, the average between the highest "bid" and
lowest "offered" quotations of a share on such date (or, if none,
on the most recent date on which there were bid and offered
quotations of a share), as reported by NASDAQ, or other similar
service selected by the Committee;
(ii) if the stock is listed on such date on one (1) or more national
securities exchanges, the last reported sale price of a share on
such date as recorded on the composite tape system, or, if such
system does not cover the stock, the last reported sale price of
a share on such date on the principal national securities
exchange on which the stock is listed, or, if no sale of the
stock took place on such date, the last reported sale price of a
share on the most recent day on which a sale of a share took
place as recorded by such system or on such exchange, as the case
may be; or
(iii) if the stock is neither listed on such date on a national
securities exchange nor traded in the over-the-counter market,
the fair market value of a share on such date as determined in
good faith by the Committee, on a basis consistent with
regulations under the Code.
(p) "Incentive Stock Options" means stock options issued to Employees which
qualify under and meet the requirements of Section 422 of the Code.
(q) "Non-Employee Director" means any Director of the Company who is not an
Employee of the Company or any of its Subsidiaries.
(r) "Non-Qualified Stock Options" means stock options which do not qualify
under or meet the requirements of Section 422 of the Code.
(s) "Participant" means any person to whom an Award has been granted under
this Plan.
22
(t) "Plan" means this First Merchants Corporation 1999 Long-Term Equity
Incentive Plan authorized by the Board of Directors at its meeting held on
February 9, 1999, as such Plan from time to time may be amended as herein
provided.
(u) "Restricted Stock" means an Award of Common Shares that are
nontransferable and are subject to a substantial risk of forfeiture.
(v) "Retirement", in the case of an Employee, means the termination of all
employment with the Company and its Subsidiaries for any reason other than death
or Disability after the day on which the Employee has attained age 55.
(w) "Rule 16b-3" means Rule 16b-3 of the Securities and Exchange
Commission, under the Securities Exchange Age of 1934, as amended.
(x) "Stock Options" means the Incentive Stock Options and the Non-Qualified
Stock Options issued pursuant to the Plan.
(y) "Subsidiary" means a corporation or other form of business association
of which shares (or other ownership interests) having fifty percent (50%) or
more of the voting power are, or in the future become, owned or controlled,
directly or indirectly, by the Company.
(z) "Subsidiary Director" means a director of a Subsidiary of the Company,
who is not a Director of the Company or an Employee of the Company or any of its
Subsidiaries.
23
EXHIBIT 5.01
June 3, 1999
Board of Directors
First Merchants Corporation
200 East Jackson Street
Muncie, Indiana 47305
Gentlemen:
We have acted as counsel to First Merchants Corporation, an Indiana
corporation (the "Company"), in connection with the filing of a Registration
Statement on Form S-8 (the "Registration Statement"), with the Securities and
Exchange Commission (the "Commission") for the purposes of registering under the
Securities Act of 1933, as amended (the "Securities Act"), 600,000 of the
Company's authorized but unissued shares of common stock (the "Common Shares")
issuable under the First Merchants Corporation 1999 Long-Term Equity Incentive
Plan (the "Plan").
In connection therewith, we have investigated those questions of law as we
have deemed necessary or appropriate for purposes of this opinion. We have also
examined originals, or copies certified or otherwise identified to our
satisfaction, of those documents, corporate or other records, certificates and
other papers that we deemed necessary to examine for purposes of this opinion,
including:
1. The Company's Articles of Incorporation, together with amendments
thereto;
2. The Bylaws of the Company, as amended to date;
3. Resolutions relating to the Plan and the Common Shares adopted by the
Company's Board of Directors (the "Resolutions");
4. The Registration Statement; and
5. The Plan.
We have also relied, without investigation as to the accuracy thereof, on oral
and written communications from public officials and officers of the Company.
For purposes of this opinion, we have assumed (i) the genuineness of all
signatures of all parties other than the Company; (ii) the authenticity of all
documents submitted to us as originals and the conformity to authentic originals
of all documents submitted to us as certified or photostatic copies; (iii) that
the Resolutions have not and will not be amended, altered or superseded prior to
the issuance of the Common Shares; and (iv) that no changes will occur in the
applicable law or the pertinent facts prior to the issuance of the Common
Shares.
24
Based upon the foregoing and subject to the qualifications set forth in
this letter, we are of the opinion that the Common Shares are validly authorized
and, when (a) the pertinent provisions of the Securities Act and all relevant
state securities laws have been complied with and (b) the Common Shares have
been delivered against payment therefor as contemplated by the Plan, the Common
Shares will be legally issued, fully paid and non-assessable.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement. In giving this consent, we do not admit that we are
within the category of persons whose consent is required under Section 7 of the
Securities Act or under the rules and regulations of the Commission relating
thereto.
Very truly yours,
BINGHAM SUMMERS WELSH & SPILMAN
25
EXHIBIT 23.01
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated January 15, 1999 which appears on page
17 of the 1998 Annual Report to Shareholders of First Merchants Corporation,
which is incorporated by reference in First Merchants Corporation's Annual
Report on Form 10-K for the year ended December 31, 1998.
Olive, LLP
Indianapolis, Indiana
June 3, 1999
26