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Filed by First Merchants Corporation pursuant
to Rule 425 under the Securities Act of 1933
Subject Company: First Merchants Corporation
Commission File No.: 0-17071
The following is the text of a joint press release issued by First Merchants
Corporation and Lafayette Bancorporation on October 15, 2001.
N / E / W / S R / E / L / E / A / S / E
October 15, 2001
FOR IMMEDIATE RELEASE
LAFAYETTE BANCORPORATION AND FIRST MERCHANTS CORPORATION AGREE TO MERGE
Robert J. Weeder, President and Chief Executive Officer of Lafayette
Bancorporation ("Lafayette"), Lafayette, Indiana, and Michael L. Cox, President
and Chief Executive Officer of First Merchants Corporation ("First Merchants"),
Muncie, Indiana, today jointly announced the execution of a Definitive Agreement
to merge their two companies.
The merger will be accomplished through the exchange of 1.11 shares of First
Merchants common stock (valued at $26.01 based on First Merchants' October 12,
2001 closing price of $23.43 per share), or $30.00 in cash for each of the
outstanding shares of Lafayette. However, no more than $50,329,248 aggregate
cash may be paid in the merger and there may be allocations of stock to certain
shareholders if this threshold is exceeded. At current market prices, the
transaction will have an approximate value of $115.8 million. This transaction
will be a tax-free stock exchange for Lafayette shareholders. The transaction,
which is subject to shareholder and regulatory approval, is expected to be
completed in early 2002.
First Merchants ($1.9 billion) and Lafayette ($750 million) will have combined
assets of $2.7 billion and create the 4th largest banking company headquartered
in Indiana. It will have sixty-six banking offices in nineteen Indiana counties.
Additionally, the combined company will have two trust departments with $1.8
billion in assets under management for clients. First Merchants is characterized
by its multi-charter structure comprising eight separate banks managed
independently by local CEOs and boards of directors.
Upon the completion of the merger, Lafayette Bank & Trust Company, Lafayette's
subsidiary, will continue to operate as the largest community banking entity in
the greater Lafayette area. Robert Weeder will continue as its Chief Executive
Officer and its nine-member Board of Directors will remain intact. Additionally,
Mr. Weeder will be named a Senior Vice President of First Merchants and two
directors from Lafayette will be elected to the Board of First Merchants. In
commenting on the transaction, Mr. Weeder stated that, "First Merchants shares
our deep commitment to community banking, and has compiled an enviable record of
earnings growth spanning 25 years. Our combined strength will provide the
opportunity to further expand our growth initiatives throughout Indiana. We are
extremely pleased to announce this transaction for our shareholders who will
have the opportunity to take cash or stock in First Merchants."
Mr. Cox said, "Lafayette Bank & Trust Company is the largest community banking
organization in its attractive growth market area. They have a long history of
excellent operating performance and truly exemplify the best in community
banking. We have known Bob Weeder and his management team for many years and are
excited with the prospect of merging our organizations."
First Merchants is currently an East Central Indiana Financial Holding Company.
Its subsidiaries include First Merchants Bank in Delaware and Hamilton Counties,
the Madison Community Bank in Madison County, First United Bank in Henry County,
Union County National Bank, The Randolph County Bank, the First National Bank of
Portland in Jay County, Decatur Bank & Trust Company in Adams County, and
Frances Slocum Bank in Wabash County. The Corporation also operates First
Merchants Insurance Services, a full-service property casualty, personal lines
and healthcare insurer, headquartered in Muncie, Indiana.
First Merchants common stock is traded over-the-counter on the NASDAQ National
Market System under the symbol FRME and is rated A+ by Standard and Poor's
Corporation. Quotations are carried in daily newspapers and can be found on the
company's Internet Web page. (http://firstmerchants.com). Nine brokerage firms
make a market in First Merchants Corporation stock: Robert W. Baird & Co., Inc.;
Herzog, Heine, Geduld, Inc.; Howe Barnes & Johnson, Inc.; Keefe, Bruyette &
Woods, Inc.; Knight Securities, L.P.; McDonald Investments, Inc.; NatCity
Investments, Inc.; Sherwood Securities Corp.; and Spear, Leads and Kellog.
Lafayette Bancorporation common stock is traded Over-The-Counter Bulletin Board
of the National Association of Securities Dealers, Inc. under the symbol LAYB.
The following brokerage firms have transacted business in Lafayette
Bancorporation common stock during the past year: City Securities Corporation;
Herzog, Herne, Geduld, Inc.; Hill Thompson Madig, L.P.; Howe Barnes Investments,
Inc.; JJP Hilliard, WY Lyons, Inc.; McDonald & Company Securities, Inc.; Merrill
Lynch; Monroe Securities, Inc.; MPI Financial; Raymond James Financial Services,
Inc., located at Lafayette Bank and Trust Company; and Salomon Smith Barney,
Inc.
Statements contained in this press release that are not historical facts may
constitute forward-looking statements (within the meaning of Section 21E of the
Securities Exchange Act of 1934, as amended) which involve significant risks and
uncertainties. The companies intend such forward-looking statements to be
covered in the Private Securities Litigation Reform Act of 1995, and are
including this statement for purposes of invoking these safe harbor provisions.
The companies' ability to predict results or the actual effect of future plans
or strategies is inherently uncertain and involves a number of risks and
uncertainties, some of which have been set forth in the companies' most recent
annual reports on Form 10-K, which disclosures are incorporated by reference
herein. The fact that there are various risks and uncertainties should be
considered in evaluating forward-looking statements and undue reliance should
not be placed on such statements.
First Merchants will be filing a Registration Statement on Form S-4
concerning the merger with the Securities and Exchange Commission ("SEC"), which
will include the joint merger proxy statement / prospectus that will be mailed
to shareholders. WE URGE INVESTORS TO READ THESE DOCUMENTS BECAUSE THEY CONTAIN
IMPORTANT INFORMATION. Investors will be able to obtain the documents free of
charge, when filed, at the SEC's website, www.sec.gov. In addition, documents
filed with the SEC by First Merchants will be available free of charge from the
Secretary of First Merchants at 200 East Jackson Street, Muncie, Indiana
47305-2814, telephone (765) 747-1530. Documents filed with the SEC by Lafayette
will be available free of charge from the Secretary of Lafayette at 133 North
Fourth Street, P.O. Box 1130, Lafayette, Indiana, 47902-1130, telephone (765)
423-7296. INVESTORS SHOULD READ THE JOINT MERGER PROXY STATEMENT/PROSPECTUS
CAREFULLY BEFORE MAKING A DECISION CONCERNING THE MERGER. Copies of all recent
proxy statements and annual reports are also available free of charge from the
respective companies by contacting the company secretary.
Lafayette and First Merchants and their respective directors and
executive officers may be deemed to be participants in the solicitation of
proxies to approve the Merger. INFORMATION ABOUT THE PARTICIPANTS MAY BE
OBTAINED THROUGH THE SEC'S WEBSITE FROM THE DEFINITIVE PROXY STATEMENT FILED
WITH THE SEC ON FEBRUARY 23, 2001, WITH RESPECT TO FIRST MERCHANTS AND THE
DEFINITIVE PROXY STATEMENT FILED WITH THE SEC ON MARCH 2, 2001, WITH RESPECT TO
LAFAYETTE.
CONTACTS: First Merchants Corporation
James L. Thrash
Senior Vice President/Chief Financial Officer
Phone: (765) 747-1390
Lafayette Bancorporation
Robert J. Weeder
President & Chief Executive Officer
Phone: (765) 423-7289