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<SEC-DOCUMENT>0000912057-97-017584.txt : 19970515
<SEC-HEADER>0000912057-97-017584.hdr.sgml : 19970515
ACCESSION NUMBER: 0000912057-97-017584
CONFORMED SUBMISSION TYPE: 10-Q
PUBLIC DOCUMENT COUNT: 6
CONFORMED PERIOD OF REPORT: 19970331
FILED AS OF DATE: 19970514
SROS: NASD
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: FIRST MERCHANTS CORP
CENTRAL INDEX KEY: 0000712534
STANDARD INDUSTRIAL CLASSIFICATION: NATIONAL COMMERCIAL BANKS [6021]
IRS NUMBER: 351544218
STATE OF INCORPORATION: IN
FISCAL YEAR END: 1231
FILING VALUES:
FORM TYPE: 10-Q
SEC ACT: 1934 Act
SEC FILE NUMBER: 000-17071
FILM NUMBER: 97604569
BUSINESS ADDRESS:
STREET 1: 200 E JACKSON ST
STREET 2: PO BOX 792
CITY: MUNCIE
STATE: IN
ZIP: 47308-0792
BUSINESS PHONE: 3177471500
MAIL ADDRESS:
STREET 1: 200 EAST JACKSON STREET
CITY: MUNCIE
STATE: IN
ZIP: 47305
</SEC-HEADER>
<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<DESCRIPTION>FORM 10-Q
<TEXT>
<PAGE>
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
QUARTERLY REPORT UNDER SECTION 13 or 15 (d) of THE
SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended March 31, 1997
Commission File Number 0-17071
First Merchants Corporation
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Indiana 35-1544218
- --------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation of organization) Identification No.)
200 East Jackson Street - Muncie, IN 47305-2814
- --------------------------------------------------------------------------------
(Address of principal executive office) (Zip code)
(765) 747-1500
- --------------------------------------------------------------------------------
(Registrant's telephone number, including area code)
Not Applicable
- --------------------------------------------------------------------------------
(Former name former address and former fiscal year,
if changed since last report.)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days,
Yes X No
----- -----
As of May 5, 1997, there were outstanding 6,612,490 common shares, without
par value, of the registrant.
The exhibit index appears on page 19.
This report including the cover page contains a total of 38 pages.
Page 1
<PAGE>
FIRST MERCHANTS CORPORATION
FORM 10-Q
INDEX
Page No.
--------
PART I. Financial information:
Item 1. Financial Statements:
Consolidated Condensed Balance Sheet............................. 3
Consolidated Condensed Statement of Income....................... 4
Consolidated Condensed Statement of Changes in
Stockholders' Equity............................................. 5
Consolidated Condensed Statement of Cash Flows................... 6
Notes to Consolidated Condensed Financial Statements............. 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.............................. 12
PART II. Other Information:
Item 4. Submission of Matters to a Vote of Security Holders.............. 19
Item 6. Exhibits and Reports of Form 8-K................................. 19
Signatures ................................................................. 20
Page 2
<PAGE>
FIRST MERCHANTS CORPORATION
FORM 10-Q
PART I. FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
CONSOLIDATED CONDENSED BALANCE SHEET
(Dollars in thousands, except per share amounts)
(Unaudited)
<TABLE>
<CAPTION>
March 31, December 31,
1997 1996
--------- ------------
<S> <C> <C>
ASSETS:
Cash and due from banks........................... $ 35,020 $ 33,882
Federal funds sold................................ 1,560 1,150
--------- ------------
Cash and cash equivalents...................... 36,580 35,032
Interest-bearing deposits......................... 371 290
Investment securities available for sale.......... 230,973 228,379
Investment securities held to maturity............ 42,442 47,227
Mortgage Loans held for sale...................... 144 284
Loans............................................. 651,782 631,416
Less: Allowance for loan losses.............. (6,883) (6,622)
--------- ------------
Net loans................................... 644,899 624,794
Premises and equipment............................ 15,284 15,303
Federal Reserve and Federal Home Loan Bank stock.. 3,090 3,090
Interest receivable............................... 8,289 8,643
Core deposit intangibles and goodwill............. 1,681 1,714
Others assets..................................... 4,078 3,237
--------- ------------
Total assets................................ $ 987,831 $ 967,993
--------- ------------
--------- ------------
LIABILITIES:
Deposits:
Noninterest-bearing............................ $ 95,886 $ 110,175
Interest-bearing............................... 686,007 684,276
-------- -------
Total deposits.............................. 781,893 794,451
Short-term borrowings............................. 71,626 45,037
Federal Home Loan Bank advances................... 12,450 9,150
Interest payable.................................. 3,476 3,376
Other liabilities................................. 4,596 3,292
--------- ------------
Total liabilities........................... 874,041 855,306
STOCKHOLDERS' EQUITY:
Preferred stock, no-par value:
Authorized and unissued -- 500,000 shares
Common stock, $.125 stated value:
Authorized --- 20,000,000 shares
Issued and outstanding -- 6,610,357
and 6,603,319 shares........................... 827 825
Additional paid-in capital........................ 23,155 22,968
Retained earnings................................. 89,822 87,978
Net unrealized gain (loss) on securities available
for sale......................................... (14) 916
--------- ------------
Total stockholders' equity.................. 113,790 112,687
--------- ------------
Total liabilities and stockholders' equity.. $ 987,831 $ 967,993
--------- ------------
--------- ------------
</TABLE>
See notes to consolidated condensed financial statements.
Page 3
<PAGE>
FIRST MERCHANTS CORPORATION
FORM 10-Q
CONSOLIDATED CONDENSED STATEMENT OF INCOME
(Dollars in thousands, except per share amounts)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31
----------------------
1997 1996
---------- ----------
<S> <C> <C>
Interest Income:
Loans receivable
Taxable......................................... $ 13,793 $ 12,480
Tax exempt...................................... 29 18
Investment securities:
Taxable......................................... 2,949 3,290
Tax exempt...................................... 1,039 911
Federal funds sold................................. 27 270
Deposits with financial institutions............... 3 5
Federal Reserve and Federal Home Loan Bank stock... 44 36
---------- ----------
Total interest income........................ 17,884 17,010
Interest expense:
Deposits........................................... 7,502 7,365
Short-term borrowings.............................. 708 547
Federal Home Loan Bank advances.................... 133 125
---------- ----------
Total interest expense.......................... 8,343 8,037
---------- ----------
Net Interest Income................................... 9,541 8,973
Provision for loan losses............................. 287 280
---------- ----------
Net Interest Income After Provision For Loan Losses... 9,254 8,693
Other Income:
Net realized gains on sales of
available-for-sale securities.................... 10 17
Other income....................................... 2,122 1,955
---------- ----------
Total other income.................................... 2,132 1,972
Total other expenses.................................. 6,206 5,822
---------- ----------
Income before income tax.............................. 5,180 4,843
Income tax expense.................................... 1,751 1,656
---------- ----------
Net Income............................................ $ 3,429 $ 3,187
---------- ----------
---------- ----------
Per share:
Net income......................................... $ .52 $ .49
Dividends (1)...................................... .24 .20
Weighted average shares outstanding................... 6,605,012 6,564,529
</TABLE>
(1) Dividends per share is for First Merchants Corporation only, not restated
for pooling transactions.
See notes to consolidated condensed financial statements.
Page 4
<PAGE>
FIRST MERCHANTS CORPORATION
FORM 10-Q
CONSOLIDATED CONDENSED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
(Dollar amounts in thousands)
(Unaudited)
<TABLE>
<CAPTION>
1997 1996
-------- --------
<S> <C> <C>
Balances, January 1......................................... $112,687 $104,967
Net income.................................................. 3,429 3,187
Cash dividends.............................................. (1,585) (1,122)
Net change in unrealized loss on securities available
for sale.................................................. (930) (1,338)
Stock issued under dividend reinvestment and stock
purchase plan............................................. 175 124
Stock options exercised..................................... 14 34
-------- --------
Balances, March 31...........................................$113,790 $105,852
-------- --------
-------- --------
</TABLE>
See notes to consolidated condensed financial statements.
Page 5
<PAGE>
FIRST MERCHANTS CORPORATION
FORM 10-Q
CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS
(Dollar amounts in thousands)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31
---------------------
1997 1996
------ ------
<S> <C> <C>
Cash Flows From Operating Activities:
Net income.......................................................................... $ 3,429 $ 3,187
Adjustments to reconcile net income to net cash provided by operating activities
Provision for loan losses......................................................... 287 280
Depreciation and amortization..................................................... 443 394
Securities amortization, net...................................................... 132 2
Securities losses (gains), net.................................................... 10 17
Mortgage loans originated for sale................................................ (700) (108)
Proceeds from sales of mortgage loans............................................. 856 853
Change in interest receivable..................................................... 438 741
Change in interest payable........................................................ 100 21
Other adjustments................................................................. 1,338 1,127
------- --------
Net cash provided by operating activities....................................... 6,333 6,514
Cash Flows From Investing Activities:
Net change in interest-bearing deposits............................................. (81) (101)
Purchases of
Securities available for sale..................................................... (20,939) (60,357)
Securities held to maturity....................................................... (1,151) (16,526)
Proceeds from maturities of
Securities available for sale..................................................... 15,153 51,818
Securities held to maturity....................................................... 6,675 21,657
Proceeds from sales of
Securities available for sale..................................................... 970
Net change in loans.................................................................. (19,961) (12,704)
Purchases of premises and equipment.................................................. (424) (278)
Other investing activities........................................................... 8 (58)
------- --------
Net cash used by investing activities........................................... (20,720) (15,579)
</TABLE>
(continued)
Page 6
<PAGE>
FIRST MERCHANTS CORPORATION
FORM 10-Q
CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS
(Dollar amounts in thousands)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
March 31
-----------------------
1997 1996
--------- -------
<S> <C> <C>
Cash Flows From Financing Activities:
Net change in
Demand and savings deposits......................................... (23,014) (38,911)
Certificates of deposit and other time deposits..................... 10,456 8,433
Short-term borrowings............................................... 26,589 2,947
Federal Home Loan Bank Advances....................................... 3,300 5,000
Repayment of Federal Home Loan Bank Advances.......................... (5,000)
Cash dividends........................................................ (1,585) (1,122)
Stock issued under dividend reinvestment and stock purchase plan...... 175 124
Stock options exercised............................................... 14 34
------- --------
Net cash used by financing activities............................. 15,935 (28,495)
------- --------
------- --------
Net Change in Cash and Cash Equivalents................................ 1,548 (37,560)
Cash and Cash Equivalents, January 1................................... 35,032 77,874
------- --------
Cash and Cash Equivalents, March 31.................................... $ 36,580 $ 40,314
------- --------
------- --------
</TABLE>
See notes to consolidated condensed financial statements.
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
NOTE 1. General
The significant accounting policies followed by First Merchants Corporation
("Corporation") and its wholly owned subsidiaries for interim financial
reporting are consistent with the accounting policies followed for annual
financial reporting, except for the change in method of accounting discussed
more fully in Note 2. All adjustments which are of a normal recurring nature
and are in the opinion of management necessary for a fair statement of the
results for the periods reported have been included in the accompanying
consolidated condensed financial statements.
NOTE 2. Change in Methods of Accounting
Statement of Financial Accounting Standards ("SFAS") No. 125, Accounting for
Transfers and Servicing of Financial Assets and Extinguishments of
Liabilities, was adopted by the Corporation on January 1, 1997. SFAS No. 125
provides consistent standards for distinguishing transfers of financial
assets that are sales from transfers that are considered secured borrowings.
A transfer of financial assets in which the transferor surrenders control
over those assets is accounted for as a sale to the extent that consideration
other than beneficial interests in the transferred assets is received in
exchange. The transferor has surrendered control over transferred assets
only if all specific conditions are met. This Statement provides detailed
measurement standards for assets and liabilities included in these
transactions. The adoption of this Statement had no material impact on the
Corporation's financial condition and results of operations.
Page 7
<PAGE>
FIRST MERCHANTS CORPORATION
FORM 10-Q
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(Table dollar amounts in thousands, except per share amounts)
(Unaudited)
NOTE 3. Business Combinations
On August 1, 1996, the Corporation issued 942,685 shares of its common stock
in exchange for all of the outstanding shares of Union National Bancorp,
Liberty, Indiana. On October 2, 1996, the Corporation issued 565,705 shares
of its common stock in exchange for all of the outstanding shares of Randolph
County Bancorp, Winchester, Indiana. These transactions were accounted for
under the pooling-of-interests method of accounting. The financial
information contained herein reflects the mergers and reports the financial
condition and results of operations as though the Corporation had been
combined as of January 1, 1996. Separate operating results of Union National
Bancorp and Randolph County Bancorp for the period prior to the merger were
as follows:
<TABLE>
<CAPTION> Three Months Ended
March 31
1996
--------
<S> <C>
Net Interest Income:
First Merchants Corporation................................... $ 7,024
Union National Bancorp........................................ 1,241
Randolph County Bancorp....................................... 708
-------
Combined................................................. $ 8,973
-------
-------
Net Income:
First Merchants Corporation.................................. $ 2,579
Union National Bancorp....................................... 371
Randolph County Bancorp...................................... 237
-------
Combined................................................... $ 3,187
-------
-------
Net Income Per Share:
First Merchants Corporation.................................. $ .39
Union National Bancorp....................................... .06
Randolph County Bancorp...................................... .04
--------
Combined.................................................... $ .49
--------
Page 8
</TABLE>
<PAGE>
FIRST MERCHANTS CORPORATION
FORM 10-Q
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(Table dollar amounts in thousands)
(Unaudited)
<TABLE>
<CAPTION>
NOTE 4. Investment Securities
Gross Gross
Amortized Unrealized Unrealized Fair
Cost Gains Losses Value
--------- ---------- ---------- ------
<S> <C> <C> <C> <C>
Available for sale at March 31, 1997:
U.S. Treasury..................................... $ 20,562 $ 26 $ 108 $ 20,480
Federal agencies.................................. 81,707 271 594 81,384
State and municipal............................... 57,765 883 320 58,328
Mortgage-backed securities........................ 38,930 280 395 38,815
Other asset-backed securities..................... 620 5 625
Corporate obligations............................. 31,000 75 242 30,833
Marketable equity security........................ 508 508
--------- --------- ---------- --------
Total available for sale 231,092 1,540 1,659 230,973
--------- --------- ---------- --------
Held to maturity at March 31, 1997:
U.S. Treasury..................................... 249 11 238
Federal agencies.................................. 3,424 10 15 3,419
State and municipal............................... 32,868 173 107 32,934
Mortgage-backed securities........................ 3,083 1 14 3,070
Other asset-backed securities..................... 1,820 3 101 1,722
Corporate obligations............................. 998 1 999
--------- --------- --------- --------
Total held to maturity......................... 42,442 188 248 42,382
--------- --------- ---------- --------
Total investment securities.................... $ 273,534 $ 1,728 $ 1,907 $273,355
--------- --------- ----------- --------
--------- --------- ----------- --------
</TABLE>
Page 9
<PAGE>
FIRST MERCHANTS CORPORATION
FORM 10-Q
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(Table dollar amounts in thousands)
(Unaudited)
<TABLE>
<CAPTION>
Gross Gross
Amortized Unrealized Unrealized Fair
Cost Gains Losses Value
--------- ---------- --------- --------
<S> <C> <C> <C> <C>
Available for sale at December 31, 1996:
U.S. Treasury............................. $ 21,570 $ 92 $ 46 $ 21,616
Federal agencies.......................... 79,130 540 180 79,490
State and municipal....................... 52,026 1,173 106 53,093
Mortgage-backed securities................ 41,441 297 275 41,463
Other asset-backed securities............. 709 709
Corporate obligations..................... 31,470 156 128 31,498
Marketable equity securities.............. 510 510
------- ------- ------ ------
Total available for sale................. 226,856 2,258 735 228,379
------- ------- ------ -------
Held to maturity at December 31, 1996:
U.S. Treasury............................ 249 7 242
Federal agencies......................... 5,729 23 5 5,747
State and municipal...................... 36,405 381 21 36,765
Mortgage-backed securities............... 2,730 13 2,717
Other asset-backed securities............ 2,114 17 108 2,023
------- ------ ----- -------
Total held to maturity.................. 47,227 421 154 47,494
------- ------ ----- -------
Total investment securities............. $ 274,083 $ 2,679 $ 889 $ 275,873
------- ------ ----- -------
------- ------ ----- -------
</TABLE>
Page 10
<PAGE>
FIRST MERCHANTS CORPORATION
FORM 10-Q
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(Table dollar amounts in thousands)
(Unaudited)
<TABLE>
<CAPTION>
NOTE 5. Loans and Allowance
March 31, December 31,
1997 1996
<S> --------- -----------
Loans: <C> <C>
Commercial and industrial loans..................................... $ 135,195 $ 132,134
Bankers' acceptances and loans to financial institutions............ 965 625
Agricultural production financing and other loans to farmers........ 16,253 18,906
Real estate loans:
Construction....................................................... 14,808 13,167
Commercial and farmland............................................ 102,594 97,596
Residential........................................................ 261,644 253,530
Individuals' loans for household and other personal expenditures.... 117,060 113,507
Tax-exempt loans.................................................... 1,286 1,643
Other loans......................................................... 3,044 1,672
Unearned interest on loans.......................................... (1,067) ( 1,364)
-------- --------
Total.............................................................. $ 651,782 $ 631,416
-------- --------
-------- --------
Three Months Ended
March 31
--------------------
1997 1996
--------- --------
Allowance for loan losses:
Balances, January 1................................................. $ 6,622 $ 6,696
Provision for losses................................................ 287 280
Recoveries on loans................................................. 249 77
Loans charged off................................................... (275) ( 499)
--------- --------
Balances, March 31.................................................. $ 6,883 6,554
--------- --------
--------- --------
</TABLE>
Page 11
<PAGE>
FIRST MERCHANTS CORPORATION
FORM 10-Q
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The Corporation's financial data for periods prior to mergers
accounted for as pooling of interests has been restated.
RESULTS OF OPERATIONS
The Corporation has recorded 21 consecutive years of growth in
earnings per share, reaching $2.00 in 1996, an increase of 8.7 per cent over
1995.
Return on assets rose to 1.41 per cent in 1996, from 1.35 per cent
in 1995, and 1.22 per cent in 1994.
Return on equity, was 12.16 per cent in 1996, 12.17 per cent in
1995, and 12.42 per cent in 1994.
Following are the levels achieved in each of these ratios during the
first quarter of 1997, as compared to the same period in 1996.
-Earnings per share were $.52, up 6.1 per cent from $.49
-Return on assets was 1.42 per cent increasing from 1.39 per cent
-Return on equity totaled 12.11 per cent compared to 12.10 per cent
for the first quarter of 1996
CAPITAL
The Corporation's capital strength continues to exceed regulatory
minimums and peer group averages. Management believes that strong capital is
a distinct advantage in the competitive environment in which the Corporation
operates and will provide a solid foundation for continued growth.
The Corporation's Tier I capital to average assets ratio was 11.6 per
cent at year-end 1996 and 11.7 per cent at March 31, 1997. At March 31,
1997, the Corporation had a Tier I risk-based capital ratio of 16.8 per cent,
total risk-based capital ratio of 17.8 per cent, and a leverage ratio of 11.6
per cent. Regulatory capital guidelines require a Tier I risk-based capital
ratio of 4.0 per cent and a total risk-based capital ratio of 8.0 per cent.
Page 12
<PAGE>
FIRST MERCHANTS CORPORATION
FORM 10-Q
ASSET QUALITY/PROVISION FOR LOAN LOSSES
The Corporation's asset quality and loan loss experience have
consistently been superior to that of its peer group, as summarized on the
following page. Asset quality has been a major factor in the Corporation's
ability to generate consistent profit improvement.
The allowance for loan losses is maintained through the provision for
loan losses, which is a charge against earnings.
The amount provided for loan losses and the determination of the
adequacy of the allowance are based on a continuous review of the loan
portfolio, including an internally administered loan "watch" list and an
independent loan review provided by an outside accounting firm. The
evaluation takes into consideration identified credit problems, as well as
the possibility of losses inherent in the loan portfolio that cannot be
specifically identified.
The following table summarized the risk elements for the Corporation
(table dollar amounts in thousands.)
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------
(Dollars in Thousands) March 31, December 31, December 31,
1997 1996 1995
- -------------------------------------------------------------------------------
<S> <C> <C> <C>
Non-accrual loans..................... $2,408 $2,777 $ 576
Loans contractually past due 90 days
or more other than nonaccruing....... 1,560 1,699 1,119
Restructured loans.................... 1,212 1,540 1,075
------ ------ ------
Total......................... $5,180 $6,016 $2,770
------ ------ ------
------ ------ ------
</TABLE>
The increase in non-performing loans from December 31, 1995, to December
31, 1996, is primarily attributable to one loan placed in non-accrual status
during 1996. This loan is included in impaired loans at December 31, 1996,
for which an allowance was recorded. Management is in the process of
resolving this loan situation and anticipates that no additional provision
for loan losses will be required.
The Corporation adopted SFAS No. 114 and No. 118 ACCOUNTING BY CREDITORS
FOR IMPAIRMENT OF A LOAN AND ACCOUNTING BY CREDITORS FOR IMPAIRMENT OF A
LOAN-INCOME RECOGNITION AND DISCLOSURES on January 1, 1995. Impaired loans
included in the table above, totaled $3,992,000 at December 31, 1996, was not
deemed necessary for impaired loans totaling $868,000, but an allowance of
$1,092,000 was recorded for the remaining balance of impaired loans of
$3,124,000. The average balance of Impaired loans for 1996 was $5,213,000.
The balance of impaired loans has not changed significantly since December
31, 1996.
At December 31, 1996, the allowance for loan losses was $6,622,000, down
slightly from year end 1995. As a per cent of loans, the allowance was 1.05
per cent, down from 1.21 per cent at year end 1995. The provision for loan
losses in 1996 was $1,253,000 compared to $1,388,000 in 1995.
Page 13
<PAGE>
FIRST MERCHANTS CORPORATION
FORM 10-Q
At March 31, 1997, the allowance for loan losses increased by $261,000
to $6,883,000, or 1.06 per cent of total loans. The first quarter 1997
provision of $287,000 was up only slightly from the same quarter in 1996, and
was offset by only $26,000 in net charge-offs.
The table below presents loan loss experience for the years indicated
and compares the Corporation's loss experience to that of its peer group,
consisting of bank holding companies with assets between $500 million and $1
billion.
<TABLE>
<CAPTION>
1997 (1) 1996 1995 1994
------ ------ ------ ------
(Dollars in Thousands)
<S> <C> <C> <C> <C>
Allowance for loan losses:
Balance at January 1.................. $6,622 $6,696 $6,603 $6,467
------ ------ ------ ------
Chargeoffs............................ 275 1,636 1,554 1,488
Recoveries............................ 249 309 259 422
------ ------ ------ ------
Net chargeoffs........................ 26 1,327 1,295 1,066
Provision for loan losses............. 287 1,253 1,388 1,202
------ ------ ------ ------
Balance at December 31................ $6,883 $6,622 $6,696 $6,603
------ ------ ------ ------
------ ------ ------ ------
Ratio of net chargeoffs during the
period to average loans outstanding
during the period..................... .02% (2) .23% .24% .21%
Peer Group............................. N/A .26% .26% .25%
(1) Through March 31, 1997
(2) First three months annualized
</TABLE>
Page 14
<PAGE>
FIRST MERCHANTS CORPORATION
FORM 10-Q
LIQUIDITY AND INTEREST SENSITIVITY
Asset/Liability management has been an important factor in the
Corporation's ability to record consistent earnings growth through periods of
interest rate volatility and product deregulation. Management and the Board
of Directors monitor the Corporation's liquidity and interest sensitivity
positions at regular meetings to ensure that changes in interest rates will
not adversely affect earnings. Decisions regarding investment and the
pricing of loan and deposit products are made after analysis of reports
designed to measure liquidity, rate sensitivity, the Corporation's exposure
to changes in net interest income given various rate scenarios, and the
economic and competitive environments.
The Corporation's liquidity and interest sensitivity position at March
31, 1997, remained adequate to meet the Corporation's primary goal of
achieving optimum interest margins while avoiding undue interest rate risk.
The table below presents the Corporation's interest rate sensitivity analysis
as of March 31, 1997.
INTEREST-RATE SENSITIVITY ANALYSIS
At March 31, 1997
(Dollars in Thousands)
<TABLE>
<CAPTION>
Beyond
1-180 Days 181-365 Days 1-5 Years 5 Years Total
---------- ------------ --------- ------- -------
<S> <C> <C> <C> <C> <C>
Rate-Sensitive Assets:
Federal funds sold and
interest-bearing deposits....... $ 1,931 $ 1,931
Investment securities 51,840 $ 44,479 $ 140,424 $ 36,672 273,415
Loans............................ 311,822 76,142 212,566 51,396 651,926
Federal Reserve and Federal
Home Loan Bank stock............ 2,693 397 3,090
---------- ------------ --------- ------- -------
Total rate-sensitive assets.... 368,286 120,621 352,990 88,465 930,362
---------- ------------ --------- ------- -------
Rate-Sensitive Liabilities:
Interest bearing deposits........ 302,945 78,596 303,134 1,332 686,007
Short-term borrowings............ 71,626 71,626
Federal Home Loan Bank
Advances........................ 75 2,072 7,870 2,433 12,450
---------- ------------ --------- ------- --------
Total rate-sensitive liabilities 374,646 80,668 311,004 3,765 770,083
---------- ------------ --------- ------- ---------
Interest rate sensitivity gap by
period............................ $ (6,360) $ 39,953 $ 41,986 $ 84,700
Cumulative rate sensitivity gap.... (6,360) 33,593 75,579 160,279
Cumulative rate sensitivity gap
ratio at March 31, 1997........... 98.3% 107.4% 109.9% 120.8%
</TABLE>
The Corporation had a cumulative positive gap of $33,593,000 in the one
year horizon at March 31, 1997 or 3.4 per cent of total assets. Net interest
income at financial institutions with positive gaps tends to increase when
rates increase and generally decrease as interest rates decline.
The .25 per cent increase in the prime lending rate which occurred in
late March, 1997 should have a modest positive effect on the Corporation's
net interest income.
Page 15
<PAGE>
FIRST MERCHANTS CORPORATION
FORM 10-Q
EARNING ASSETS
Earning assets increased $30.3 million during 1996.
The following table presents the earning asset mix for the years ended
1996 and 1995 and at March 31, 1997.
Loans grew by more than $79 million while short-term investments and
securities declined, reflecting the Corporation's intent to change the
balance sheet mix to emphasize loans which generally carry higher yields than
federal funds sold, interest-bearing deposits and investment securities and
often provide collateral business. The same trend continued during the first
quarter of 1997. Loans grew by more than $20 million, accounting for all of
the growth in earning assets.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------
EARNING ASSETS
(Dollars in Millions) March 31, December 31, December 31,
1997 1996 1995
--------- ------------ ------------
<S> <C> <C> <C>
Federal funds sold and interest-bearing deposits............. $ 1.9 $ 1.4 $ 39.2
Investment securities available for sale .................... 231.0 228.4 225.9
Investment securities held to maturity ...................... 42.4 47.2 60.7
Mortgage loans held for sale ................................ .1 0.3 0.7
Loans ....................................................... 651.8 631.4 552.3
Federal Reserve and Federal Home Loan Bank stock............. 3.1 3.1 2.7
--------- -------- ---------
Total.................................................... $ 930.3 $ 911.8 $ 881.5
--------- -------- ---------
--------- -------- ---------
- ---------------------------------------------------------------------------------------------------------------
</TABLE>
DEPOSITS, SHORT-TERM BORROWINGS AND FEDERAL HOME LOAN BANK ADVANCES
The following table presents the level of deposits and borrowed funds
(Federal funds purchased, repurchase agreements with customers, U.S. Treasury
demand notes and Federal Home Loan Bank advances) for the years ended 1996
and 1995 and at March 31, 1997. Lack of deposit growth coupled with loan
growth has resulted in a greater reliance on borrowed funds. The Corporation
plans to place further emphasis on deposit growth going forward through
advertising and product development.
- -----------------------------------------------------------
DEPOSITS, SHORT-TERM BORROWINGS AND
FEDERAL HOME LOAN BANK ADVANCES
(Dollars in Millions)
Federal
Short-Term Home Loan
Deposits Borrowings Bank Advances
----------------------------------------------
March 31, 1997.......... $781.9 $ 71.6 $ 12.5
December 31, 1996....... 794.5 45.0 9.2
December 31, 1995....... 783.9 37.4 9.0
---------------------------------------------
Page 16
<PAGE>
FIRST MERCHANTS CORPORATION
FORM 10-Q
NET INTEREST INCOME
Net Interest Income is the primary source of the Corporation's earnings.
It is a function of net interest margin and the level of average earning
assets.
The table below presents the Corporation's asset yields, interest
expense, and net interest income as a per cent of average earning assets for
the three-year period ending in 1996 and the first quarter of 1997.
Asset yields improved slightly in 1996 (.04 per cent FTE) due to strong
loan growth. Interest costs declined by a like amount, primarily due to rate
reductions to three interest-bearing deposit products: interest checking,
Money Market investment account and regular savings.
The resulting "spread" increase of .08 per cent combined with earning
asset growth of $35.5 million accounted for the growth in net interest income
(FTE) of $2.2 million.
During the first quarter of 1997, both interest yields and interest costs
declined, with yields falling .08 per cent, but costs by only .03 per cent.
The resulting .05 per cent decline in margin was offset by earning asset
growth of $37 million.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------------
(Dollars in Thousands)
Interest Income Interest Expense Net Interest Income Net Interest Income
(FTE) as a Per Cent as a Per Cent (FTE) as a Per Cent Average on a
of Average of Average of Average Earning Fully Taxable
Earning Assets Earning Assets Earning Assets Assets Equivalent Basis
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1997 (1) 8.05% 3.64% 4.41% $917,774 $40,464
1996 8.13 3.67 4.46 880,729 39,258
1995 8.09 3.71 4.38 845,198 37,049
1994 7.42 2.96 4.46 805,987 35,909
Average earning assets include the average balance of securities classified as available for sale, computed based on the average
of the historical amortized cost balances without the effects of the fair value adjustment.
(1) First Three Months Annualized
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
OTHER INCOME
The Corporation has placed emphasis on the growth of non-interest income
in recent years by offering a wide range of fee-based services. Fee
schedules are regularly reviewed by a pricing committee to ensure that the
products and services offered by the Corporation are priced to be competitive
and profitable.
Other income in 1996 amounted to $8,342,000 or 9.9 per cent higher than
in 1995. The increase of $750,000 is primarily attributable to the following
five factors:
1. Trust revenues increased $166,000 (5.9 percent) due to stronger
business activity and markets.
2. Deposit service charges increased $195,000 (6.9 per cent) primarily
due to changes in pricing.
3. Interchange fees for the Corporation's credit and debit card programs
grew by $169,000 (142 per cent) due to increased product offerings.
4. The Corporation recorded securities gains of $148,000 compared to
losses of $30,000 last year, an increase of $178,000 as shorter
maturity, available for sale securities were sold at gains and longer
maturity, higher yielding investments were purchased.
5. Postal money order agent fees increased $79,000 (19.4 per cent) due to
an increased client base.
Page 17
<PAGE>
FIRST MERCHANTS CORPORATION
FORM 10-Q
Other income in the first quarter of 1997 exceeded the same quarter in
the prior year by $160,000 or 8.1 per cent. Two categories accounted for most
of this increase:
1. Trust fees grew by $38,000 or 5.5 per cent, again due to stronger
activity and positive investment returns.
2. Deposit service charges increased by $82,000 or 10.8 per cent due
primarily to changes in pricing.
OTHER EXPENSE
Total "other expenses" represent non-interest operating expenses of the
Corporation. Those expenses amounted to $24,135,000 in 1996, an increase of
5.0 per cent from the prior year, or $1,142,000.
Including an $813,000 reduction in deposit insurance premiums, remaining
operating expenses grew by $1,955,000. Four major areas account for most of
this increase:
1. Salary and benefit expenses, which account for over one-half of the
Corporation's non-interest operating expenses, increased by $640,000
(5.0 per cent) due to normal salary increases.
2. Equipment expense rose $223,000, reflecting the Corporation's
investment in technology to increase productivity and improve customer
service.
3. Expenses related to mergers with Union National Bancorp and Randolph
County Bancorp amounted to $258,000.
4. The previous year included a $238,000 refund from the State of
Indiana for intangibles taxes paid in 1988 and 1989.
First quarter other expense in 1997 exceeded the same quarter one year
earlier by $384,000 or 6.6 per cent. Four primary areas account for this
increase:
1. Salaries and benefits grew by $182,000 or 5.6 per cent due
primarily to normal annual salary adjustments.
2. Business supply expense grew by $50,000 or nearly 27 per cent
primarily due to increased use of data processing supplies and
personal money order forms.
3. Equipment expense grew $29,000 or 5.4 per cent, again reflecting the
Corporation's investment in technology to increase productivity and
improve customer service.
4. Marketing expense increased $29,000 (almost 18 per cent).
INCOME TAXES
1996 income tax expense increased by $698,000 primarily due to a
$1,792,000 increase in net pre-tax income. Likewise, the increase of $95,000
in the first quarter of 1997, as compared to the same quarter in 1996,
results from a $337,000 increase in pre-tax net income which was partially
offset by a $139,000 increase in tax exempt income.
OTHER
The Securities and Exchange Commission maintains a Web site that contains
reports, proxy and information statements and other information regarding
registrants that file electronically with the Commission, including the
Corporation, and that the address is (http://www.sec.gov).
Page 18
<PAGE>
FIRST MERCHANTS CORPORATION
FORM 10-Q
PART II. OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None during the period covered by this report.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits:
FORM 10-Q
PAGE
EXHIBIT NO.: DESCRIPTION OF EXHIBIT: NUMBER
------------ ----------------------- ---------
10.1 First Merchants Corporation
Supplemental Executive Retirement Plan.... 21
10.2 Trust Under First Merchants Corporation
Supplemental Executive Retirement Plan.... 28
27.1 Financial Data Schedule, Quarter Ended
March 31, 1997............................ 36
27.2 Restated Financial Data Schedule, Quarter
Ended March 31, 1996...................... 37
27.3 Restated Financial Data Schedule, Quarter
Ended March 31, 1995...................... 38
(b) Reports on Form 8-K:
No reports were filed on Form 8-K during the quarter ended March
31, 1997.
Page 19
<PAGE>
FIRST MERCHANTS CORPORATION
FORM 10-Q
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 thereunto duly authorized.
FIRST MERCHANTS CORPORATION
-------------------------------
(Registrant)
Date May 12, 1997 by /s/ Stefan S. Anderson
----------------- ---------------------------------
Stefan S. Anderson
President and Director
Date May 12, 1997 by /s/ James L. Thrash
---------------- ---------------------------------
James L. Thrash
Chief Financial & Principal
Accounting Officer
Page 20
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.1
<SEQUENCE>2
<DESCRIPTION>FIRST MERCHANTS SUPP. EXEC. RET. PLAN
<TEXT>
<PAGE>
- -------------------------------------------------------------------------------
EXHIBIT 10.1 -- First Merchants Corporation
Supplemental Executive Retirement Plan
- -------------------------------------------------------------------------------
SECTION 1. ESTABLISHMENT AND PURPOSE
A. Establishment. First Merchants Corporation (the "Employer"), hereby
establishes a non-qualified supplemental executive retirement plan for
certain executives, as designated and described herein, which shall be known
as the FIRST MERCHANTS CORPORATION SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
(the "Plan").
B. Purpose. The purpose of the Plan is to enable the Employer to attract,
retain, and motivate key executive employees of high caliber, and to provide
equitable retirement and survivor benefits for certain key executive
employees, their surviving spouses and designated beneficiaries.
SECTION 2. DEFINITIONS
For purposes of this Plan, certain words or phrases used herein will have the
following meanings:
A. "Board of Directors" means the Board of Directors of First Merchants
Corporation.
B. "Code" means the Internal Revenue Code of 1986, as amended from time to
time.
C. "Compensation Committee" means the Employer's Compensation and Human
Resources Committee.
D. "Executive" means a key executive Employee that is designated to
participate in the Plan under Section 3 below.
E. "Non-qualified SERP Benefit" means the difference between (1) and (2),
where (1) is the Retirement Benefit that would have been paid the Executive from
the Pension Plan at the Executive's Normal, Early, Late or Disability Retirement
Date (whichever is applicable) if there were no compensation limit imposed under
Code Section 401(a)(17) and if Final Average Monthly Plan Compensation did not
exclude bonuses for purposes of determining the Standard Benefit Formula, and
(2) is the Retirement Benefit payable to the Executive under the Pension Plan at
the Executive's Normal, Early, Late or Disability Retirement Date (whichever is
applicable).
F. "Pension Plan" means the First Merchants Corporation Retirement Pension
Plan, as amended, a qualified pension plan under Section 401(a) of the Internal
Revenue Code of 1986, as amended.
Page 21
<PAGE>
G. "Term Certain Expiration Date" means the 15th anniversary of the event,
retirement or death, which causes payment of benefits under this Plan to
commence.
H. The following terms will have the same meanings as they have under the
Pension Plan: "Employee," "Employer," "Final Average Monthly Plan
Compensation," "Normal, Early, Late, or Disability Retirement Date,"
"Retirement Benefit," "Normal, Early, Late, or Disability Retirement
Benefit," "Optional Form of Payment," and "Standard Benefit Formula."
SECTION 3. DESIGNATION OF EXECUTIVES PARTICIPATING IN PLAN
The Compensation 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 Compensation Committee and
shall be limited to management or highly compensated Employees. The
Compensation Committee shall notify each Employee so designated in writing.
Covered Executives, their spouses and designated beneficiaries shall be
entitled to benefits under this Plan if the Executive is employed by the
Employer on his or her 65th birthday, Early Retirement Date, Disability
Retirement Date or death, whichever occurs earliest.
SECTION 4. RETIREMENT BENEFIT
If an Executive retires on his or her Normal, Early, Late or Disability
Retirement Date, the Executive shall receive each year thereafter, in the
manner described in Section 6, an amount equal to the Non-qualified SERP
Benefit for the Executive's lifetime. If the Executive's Retirement Benefit
under the Pension Plan commences at a time other than his or her Normal
Retirement Date or in an Optional Form of Payment, the amount of the
Non-qualified SERP Benefit shall be adjusted using the same actuarial factors
and assumptions (except as otherwise provided in Section 7 of this Plan) used
to calculate the Retirement Benefit payable to the Executive under the
Pension Plan.
SECTION 5. PRE-RETIREMENT SURVIVOR BENEFIT
If a covered Executive dies while still actively employed by the Employer,
and if the Executive is survived by the Executive's spouse, the Executive's
spouse shall receive each year until the Term Certain Expiration Date, in the
manner described in Section 6, the Non-qualified SERP Benefit otherwise
payable to the Executive under this Plan, determined as if the Executive had
retired on the date immediately preceding the date of the Executive's death.
If the Executive is not survived by the Executive's spouse, or if the spouse
does not live until the Term Certain Expiration Date, the person(s)
designated under Section 8 shall receive each year, in the manner described
in Section 6, an amount equal to such Benefit.
Page 22
<PAGE>
SECTION 6. MANNER OF PAYING BENEFITS
Within 30 days following the death or retirement of the Executive, a monthly
benefit payment shall be commence equal to the yearly benefit payable under
Section 4 or 5 of this Plan.
SECTION 7. FIFTEEN YEAR TERM CERTAIN
Benefits on behalf of a covered Executive, whether payable as a Normal,
Early, Late, or Disability Retirement Benefit, or as a Pre-retirement
Survivor Benefit or other death benefit payable to a designated beneficiary,
shall be made at least through the Term Certain Expiration Date, without any
actuarial reduction on account of such guaranteed payment. At any time, in
the discretion of the Compensation Committee, the commuted value of the
future benefits payable under the Plan on behalf of any recipient may be
computed and paid in one lump sum.
SECTION 8. DESIGNATION OF BENEFICIARY
An Executive, or subsequent to the Executive's death, the Executive's spouse,
may designate the person(s) to receive the benefits payable under this Plan
if the Executive and the Executive's spouse do not live to receive the
benefits through the Term Certain Expiration Date. 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.
SECTION 9. EARLY, LATE OR DISABILITY RETIREMENT
The Compensation Committee may grant to a covered Executive, while in the
employ of the Employer, early, late or disability retirement under this Plan,
if such Executive is eligible for and elects an Early, Late or Disability
Retirement Benefit under the Pension Plan. The Compensation Committee, in
its sole discretion, may provide that retirement benefits under this Plan
shall begin at any time after the granting of early, late or disability
retirement, rather than at the Executive's Normal Retirement Date, and the
Term Certain Expiration Date shall terminate on the 15th anniversary of the
commencement of retirement benefits.
SECTION 10. TERMINATION OF EMPLOYMENT
If an Executive's employment with the Employer is terminated prior to his or
her Normal Retirement Date, either by the Employer or by the Executive, and
either with or without cause, no benefits shall be paid under any provision
of this Plan, unless the Compensation Committee, in its sole discretion,
shall provide that the benefits will be paid regardless of the termination of
the Executive's employment. However, early or disability retirement or death
shall not be deemed to be a termination of employment for purposes of this
Section.
Page 23
<PAGE>
SECTION 11. PROHIBITION OF COMPETITIVE EMPLOYMENT
If, during the period of an Executive's employment with the Employer or while
the Executive is receiving benefits under this Plan, a covered Executive
engages in competitive activities without the Employer's written consent, no
further benefits shall be payable under any provision of this Plan. For
purposes of this Section, "competitive activities" shall mean engaging,
directly or indirectly (including providing consulting services), in a
business similar to any business of the Employer or any of its subsidiaries,
or owning, managing, operating, controlling, being employed by, participating
in, having any financial interest in, or being connected in any manner with
the ownership, management, operation or conduct of, any such similar business.
SECTION 12. TITLE TO LIFE INSURANCE
If life insurance is purchased to provide the Employer with funds to make
benefit payments under this Plan to or on behalf of a covered Executive, the
owner and beneficiary of such life insurance contract shall at all times be
the Employer or, if the Employer establishes a "rabbi trust" in connection
with this Plan, the trustee of such trust. If the Employer is the owner and
beneficiary of the life insurance contract, it shall have the unrestricted
right to use all amounts and to exercise all options and privileges
thereunder without the knowledge or consent of the Executive, his or her
designated beneficiary, or any other person, it being expressly agreed that
neither the Executive nor any such beneficiary or other person shall have any
right, title or interest whatsoever in or to any such contract. If the
trustee of a "rabbi trust" is the owner and beneficiary of the life insurance
contract, the respective rights and interests of the Employer, the trustee,
the Executive, his or her designated beneficiary, and other persons, shall be
governed by the terms of the trust agreement and the life insurance contract.
SECTION 13. PAYMENTS ARE NOT SECURED
Except as provided in the "rabbi trust" agreement, if any, 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.
Page 24
<PAGE>
SECTION 14. NON-ASSIGNABILITY OF BENEFITS
Neither the Executive, nor his or her designated beneficiary, nor any other
person entitled to any payment hereunder, shall have power to transfer,
assign, anticipate, mortgage or otherwise encumber any right to receive a
payment in advance of the time such payment is due under the provisions of
this Plan, and any attempted transfer, assignment, anticipation, mortgage or
encumbrance shall be void. No payment hereunder shall be subject to seizure
for the payment of public or private debts, judgments, alimony or separate
maintenance, or be transferable by operation of law in the event of
bankruptcy, insolvency or otherwise.
SECTION 15. ADMINISTRATION OF THE PLAN
The Plan shall be administered by the Compensation Committee, which shall
have sole authority to construe and interpret the Plan and issue such rules
and regulations as it deems appropriate. The Compensation Committee shall
have the duty and responsibility of deciding questions of eligibility,
determining the amount, manner and time of payment of any benefits hereunder,
and distributing the benefits to covered Executives, their spouses and/or
beneficiaries; provided, however, the Compensation 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
Compensation Committee's interpretations, determinations, rules and
regulations, and calculations shall be final and binding on all persons and
parties concerned. If a covered Executive, spouse or beneficiary desires a
review of any benefit determination made by the Compensation Committee, he or
she shall follow the claims review procedure described in Section 6.06 of the
Pension Plan (except that such appeal shall be to the Compensation Committee
rather than to the committee responsible for administering the Pension Plan,
if different).
SECTION 16. AMENDMENT
This Plan may be amended at any time or from time to time by the Board of
Directors of the Employer. Any amendment shall not reduce the benefit of any
covered Executive, or any person receiving benefits under this Plan, without
the written consent of the affected person. The failure of either the
Employer or any covered Executive to enforce any of the provisions hereof
shall not be deemed a waiver thereof. No provision of this Plan shall be
deemed to have been waived or modified unless such waiver or modification
shall be in writing and signed by the party or parties affected by such
waiver or modification. The Employer reserves the right to terminate the
Plan at any time by action of the Board of Directors. The termination of
this Plan shall not affect the benefits of any Executive, Executive's spouse
or designated beneficiary covered by the Plan, prior to termination.
Page 25
<PAGE>
SECTION 17. NON-GUARANTEE OF EMPLOYMENT
This Plan shall not be construed as giving any Executive the right to be
retained as an Employee of the Employer for any period.
SECTION 18. BINDING EFFECT AND GOVERNING LAW
This Plan shall be binding upon the Executive and the Executive's spouse,
beneficiaries, heirs, executors, administrators, personal representatives,
successors and assigns, and upon the Employer and its successors and assigns.
Except as preempted by ERISA or any other applicable federal law, the Plan
shall be construed, enforced and administered, and the validity thereof shall
be determined, in accordance with the laws of the State of Indiana.
This Plan was adopted by the Board of Directors of First Merchants
Corporation on February 11, 1997, and shall be effective as of March 1, 1997.
First Merchants Corporation
By: /s/ Stefan S. Anderson
----------------------------------
Title: President
--------------------------------
Page 26
<PAGE>
- -------------------------------------------------------------------------------
Schedule A to First Merchants Corporation
Supplemental Executive Retirement Plan
- -------------------------------------------------------------------------------
The Corporation's Supplemental Executive Retirement Plan covers the following
executives:
Offices with the Corporation
Name and Subsidiary Banks
- ---- ----------------------------
Stefan S. Anderson President and Chief Executive Officer,
Corporation; Chief Executive Officer,
First Merchants Bank, N.A.
Michael L. Cox Executive Vice President, Chief
Operating Officer, Corporation;
Chief Operating Officer,
First Merchants Bank, N.A.
Ted J. Montgomery Senior Vice President, Corporation;
Chief Executive Officer, The Union
County National Bank of Liberty
Roger W. Gilcrest Executive Vice President, First
Merchants Bank, N.A.
Page 27
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10.2
<SEQUENCE>3
<DESCRIPTION>TRUST UNDER FIRST MERCHANTS SUPP. EXEC. RET. PLAN
<TEXT>
<PAGE>
- -------------------------------------------------------------------------------
EXHIBIT 10.2 -- Trust Under First Merchants Corporation
Supplemental Executive Retirement Plan
- -------------------------------------------------------------------------------
This Agreement made this 1st day of March, 1997, by and between First
Merchants Corporation ("EMPLOYER"), and First Merchants Bank, N.A.
("TRUSTEE"):
WHEREAS, Employer has adopted the nonqualified deferred compensation
plan known as the First Merchants Corporation Supplemental Executive
Retirement Plan ("PLAN");
WHEREAS, Employer has incurred or expects to incur liability under the
terms of such Plan with respect to the individuals participating in such
Plan;
WHEREAS, Employer wishes to establish a trust (hereinafter called
"TRUST") and to contribute to the Trust assets that shall be held therein,
subject to the claims of Employer's creditors in the event of Employer's
Insolvency, as herein defined, until paid to Plan participants and their
beneficiaries in such manner and at such times as specified in the Plan;
WHEREAS, it is the intention of the parties that this Trust shall
constitute an unfunded arrangement and shall not affect the status of the
Plan as an unfunded plan maintained for the purpose of providing deferred
compensation for a select group of management or highly compensated employees
for purposes of Title I of the Employee Retirement Income Security Act
of 1974; and
WHEREAS, it is the intention of Employer to make contributions to the
Trust to provide itself with a source of funds to assist it in the meeting of
its liabilities under the Plan.
NOW, THEREFORE, the parties do hereby establish the trust and agree that
the Trust shall be comprised, held and disposed of as follows:
SECTION 1. ESTABLISHMENT OF TRUST.
(a) Employer hereby deposits with Trustee in trust the cash and
insurance policies listed in Schedule A, which shall become the principal of
the Trust to be held, administered and disposed of by Trustee as provided in
this Trust Agreement.
(b) The Trust hereby established shall be irrevocable.
(c) The Trust is intended to be a grantor trust, of which Employer is
the grantor, within the meaning of subpart E, part I, subchapter J, chapter
1, subtitle A of the Internal Revenue Code of 1986, as amended, and shall be
construed accordingly.
Page 28
<PAGE>
(d) The principal of the Trust, and any earnings thereon shall be held
separate and apart from other funds of Employer and shall be used exclusively
for the uses and purposes of Plan participants and general creditors as
herein set forth. Plan participants and their beneficiaries shall have no
preferred claim on, or any beneficial ownership interest in, any assets of
the Trust. Any rights created under the Plan and this Trust Agreement shall
be mere unsecured contractual rights of Plan participants and their
beneficiaries against Employer. Any assets held by the Trust will be subject
to the claims of Employer's general creditors under federal and state law in
the event of Insolvency, as defined in Section 3(a) herein.
(e) Employer, in its sole discretion, may at any time, or from time to
time, make additional deposits of cash or other property in trust with
Trustee to augment the principal to be held, administered and disposed of by
Trustee as provided in this Trust Agreement. Neither Trustee nor any Plan
participant or beneficiary shall have any right to compel such additional
deposits.
SECTION 2. PAYMENTS TO PLAN PARTICIPANTS AND THEIR BENEFICIARIES.
(a) Employer shall deliver to Trustee a schedule (the "PAYMENT
SCHEDULE") that indicates the amounts payable in respect of each Plan
participant (and his or her beneficiaries), that provides a formula or other
instructions acceptable to Trustee for determining the amounts so payable,
the form in which such amount is to be paid (as provided for or available
under the Plan), and the time of commencement for payment of such amounts.
Except as otherwise provided herein, Trustee shall make payments to the Plan
participants and their beneficiaries in accordance with such Payment
Schedule. The Trustee shall make provision for the reporting and withholding
of any federal, state or local taxes that may be required to be withheld with
respect to the payment of benefits pursuant to the terms of the Plan and
shall pay amounts withheld to the appropriate taxing authorities or determine
that such amounts have been reported, withheld and paid by Employer.
(b) The entitlement of a Plan participant or his or her beneficiaries
to benefits under the Plan shall be determined by Employer or such party as
it shall designate under the Plan, and any claim for such benefits shall be
considered and reviewed under the procedures set out in the Plan.
(c) Employer may make payment of benefits directly to Plan participants
or their beneficiaries as they become due under the terms of the Plan.
Employer shall notify Trustee of its decision to make payment of benefits
directly prior to the time amounts are payable to participants or their
beneficiaries. In addition if the principal of the Trust, and any earnings
thereon, are not sufficient to make payments of benefits in accordance with
the terms of the Plan, Employer shall make the balance of each such payment
as it falls due. Trustee shall notify Employer where principal and earnings
are not sufficient.
Page 29
<PAGE>
SECTION 3. TRUSTEE RESPONSIBILITY REGARDING PAYMENTS TO TRUST BENEFICIARY
WHEN EMPLOYER IS INSOLVENT.
(a) Trustee shall cease payment of benefits to Plan participants and
their beneficiaries if the Employer is Insolvent. Employer shall be
considered "Insolvent" for purposes of this Trust Agreement if (i) Employer
is unable to pay its debts as they become due, or (ii) Employer is subject to
a pending proceeding as a debtor under the United States Bankruptcy Code.
(b) At all times during the continuance of this Trust, as provided in
Section 1(d) hereof, the principal and income of the Trust shall be subject
to claims of general creditors of Employer under federal and state law as set
forth below.
(1) The Board of Directors and the Chief Executive Officer of
Employer shall have the duty to inform Trustee in writing of Employer's
insolvency. If a person claiming to be a creditor of Employer alleges in
writing to Trustee that Employer has become insolvent, Trustee shall
determine whether Employer is Insolvent and, pending such determination,
Trustee shall discontinue payment of benefits to Plan participants or
their beneficiaries.
(2) Unless Trustee has actual knowledge of Employer's insolvency, or
has received notice from Employer or a person claiming to be a creditor
alleging that Employer is Insolvent, Trustee shall have no duty to inquire
whether Employer is Insolvent. Trustee may in all events rely on such
evidence concerning Employer's solvency as may be furnished to Trustee and
that provides Trustee with a reasonable basis for making a determination
concerning Employer's solvency.
(3) If at any time Trustee has determined that Employer is
insolvent, Trustee shall discontinue payments to Plan participants or
their beneficiaries and shall hold the assets of the Trust for the
benefit of Employer's general creditors. Nothing in this Trust Agreement
shall in any way diminish any rights of Plan participants or their
beneficiaries to pursue their rights as general creditors of Employer
with respect to benefits due under the Plan or otherwise.
(4) Trustee shall resume the payment of benefits to Plan
participants or their beneficiaries in accordance with Section 2 of
this Trust Agreement only after Trustee has determined that Employer is
not Insolvent (or is no longer Insolvent).
Page 30
<PAGE>
(c) Provided that there are sufficient assets, if Trustee discontinues
the payment of benefits from the Trust pursuant to Section 3(b) hereof and
subsequently resumes such payments, the first payment following such
discontinuance shall include the aggregate amount of all payments due to Plan
participants or their beneficiaries under the terms of the Plan for the
period of such discontinuance, less the aggregate amount of any payments made
to Plan participants or their beneficiaries by Employer in lieu of the
payments provided for hereunder during any such period of discontinuance.
SECTION 4. PAYMENTS TO EMPLOYER.
Except as provided in Section 3 hereof, after the Trust has become
irrevocable, Employer shall have no right or power to direct Trustee to
return to Employer or to divert to others any of the Trust assets before all
payment of benefits have been made to Plan participants and their
beneficiaries pursuant to the terms of the Plan.
SECTION 5. INVESTMENT AUTHORITY.
(a) The Trustee shall invest and reinvest the principal and income
received by and held in the Trust, and keep such assets invested without
distinction between principal and income, in insurance contracts, common or
preferred stocks, corporate and government bonds and notes, and other
securities in accordance with such investment guidelines as Employer may
provide to the Trustee from time to time.
(b) Subject to paragraph (a) of this Section, Trustee may invest in
securities (including stock or rights to acquire stock) or obligations issued
by Employer. All rights associated with assets of the Trust shall be
exercised by Trustee or the person designated by Trustee, and shall in no
event be exercisable by or rest with Plan participants.
(c) Employer shall have the right at any time, and from time to time in
its sole discretion, to substitute assets of equal fair market value for any
asset held by the Trust. This right is exercisable by Employer in a
nonfiduciary capacity without the approval or consent of any person in a
fiduciary capacity.
SECTION 6. DISPOSITION OF INCOME.
During the term of this Trust, all income received by the Trust, net of
expenses and taxes, shall be accumulated and reinvested.
Page 31
<PAGE>
SECTION 7. ACCOUNTING BY TRUSTEE.
Trustee shall keep accurate and detailed records of all investments,
receipts, disbursements, and all other transactions required to be made,
including such specific records as shall be agreed upon in writing between
Employer and Trustee. With sixty (60) days following the close of each
calendar year and within sixty (60) days after the removal or resignation of
Trustee, Trustee shall deliver to Employer a written account of its
administration of the Trust during such year or during the period from the
close of the last preceding year to the date of such removal or resignation,
setting forth all investments, receipts, disbursements and other transactions
effected by it, including a description of all securities and investments
purchased and sold with the cost or net proceeds of such purchases or sales
(accrued interest paid or receivable being shown separately), and showing all
cash, securities and other property held in the Trust at the end of such year
or as of the date of such removal or resignation, as the case may be.
SECTION 8. RESPONSIBILITY OF TRUSTEE.
(a) Trustee shall act with the care, skill, prudence and diligence
under the circumstances then prevailing that a prudent person acting in like
capacity and familiar with such matters would use in the conduct of an
enterprise of a like character and with like aims, provided, however, that
Trustee shall incur no liability to any person for any action taken pursuant
to a direction, request or approval given by Employer which is contemplated
by, and in conformity with, the terms of the Plan or this Trust and is given
in writing by Employer. In the event of a dispute between Employer and a
party, Trustee may apply to a court of competent jurisdiction to resolve the
dispute.
(b) If Trustee undertakes or defends any litigation arising in
connection with this Trust, Employer agrees to indemnify Trustee against
Trustee's costs, expenses and liabilities (including, without limitation,
attorneys' fees and expenses) relating thereto and to be primarily liable for
such payments. If Employer does not pay such costs, expenses and liabilities
in a reasonably timely manner, Trustee may obtain payment from the Trust.
(c) Trustee may consult with legal counsel (who may also be counsel for
Employer generally) with respect to any of its duties or obligations
hereunder.
(d) Trustee may hire agents, accountants, actuaries, investment
advisors, financial consultants or other professionals to assist it in
performing any of its duties or obligations hereunder.
(e) Trustee shall have, without exclusion, all powers conferred on
Trustees by applicable law, unless expressly provided otherwise herein,
provided, however, that if an insurance policy is held as an asset of the
Trust, Trustee shall have no power to name a beneficiary of the policy other
than the Trust, to assign the policy (as distinct from conversion of the
policy to a different form) other than to a successor Trustee, or to loan to
any person the proceeds of any borrowing against such policy.
Page 32
<PAGE>
(f) Notwithstanding any powers granted to Trustee pursuant to this
Trust Agreement or to applicable law, Trustee shall not have any power that
could give this Trust the objective of carrying on a business and dividing
the gains therefrom, within the meaning of Section 301.7701-2 of the
Procedure and Administrative Regulations promulgated pursuant to the Internal
Revenue Code.
SECTION 9. COMPENSATION AND EXPENSES OF TRUSTEE.
Employer shall pay all administrative and Trustee's fees and expenses.
If not so paid, the fees and expenses shall be paid from the Trust.
SECTION 10. RESIGNATION AND REMOVAL OF TRUSTEE.
(a) Trustee may resign at any time by written notice to Employer, which
shall be effective thirty (30) days after receipt of such notice unless
Employer and Trustee agree otherwise.
(b) Trustee may be removed by Employer on thirty (30) days' notice or
upon shorter notice accepted by Trustee.
(c) Upon resignation or removal of Trustee and appointment of a
successor Trustee, all assets shall subsequently be transferred to the
successor Trustee. The transfer shall be completed within sixty (60) days
after receipt of notice of resignation, removal or transfer, unless Employer
extends the time limit.
(d) If Trustee resigns or is removed, a successor shall be appointed,
in accordance with Section 11 hereof, by the effective date of resignation or
removal under paragraph (a) or (b) of this Section. If no such appointment
has been made, Trustee may apply to a court of competent jurisdiction for
appointment of a successor or for instructions. All expenses of Trustee in
connection with the proceeding shall be allowed as administrative expenses of
the Trust.
SECTION 11. APPOINTMENT OF SUCCESSOR.
(a) If Trustee resigns or is removed in accordance with Section 10(a)
or (b) hereof, Employer may appoint any third party, such as a bank trust
department or other party that may be granted corporate trustee powers under
state law, as a successor to replace Trustee upon resignation or removal.
The appointment shall be effective when accepted in writing by the new
Trustee, who shall have all of the rights and powers of the former Trustee,
including ownership rights in the Trust assets. The former Trustee shall
execute any instrument necessary or reasonably requested by Employer or the
successor Trustee to evidence the transfer.
Page 33
<PAGE>
(b) The successor Trustee need not examine the records and acts of any
prior Trustee and may retain or dispose of existing Trust assets, subject to
Sections 7 and 8 hereof. The successor Trustee shall not be responsible for
and Employer shall indemnify and defend the successor Trustee from any claim
or liability resulting from any action or inaction of any prior Trustee or
from any other past event, or any condition existing at the time it becomes
successor Trustee.
SECTION 12. AMENDMENT OR TERMINATION.
(a) This Trust may be amended by a written instrument executed by
Trustee and Employer. Notwithstanding the foregoing, no such amendment shall
conflict with the terms of the Plan or shall make the Trust revocable after
it has become irrevocable in accordance with Section 1(b) hereof.
(b) The Trust shall not terminate until the date on which Plan
participants and their beneficiaries are no longer entitled to benefits
pursuant to the terms of the Plan. Upon termination of the Trust any assets
remaining in the Trust shall be returned to Employer.
(c) Upon written approval of all participants and beneficiaries then or
thereafter entitled to payment of benefits pursuant to the terms of the Plan,
Employer may terminate this Trust prior to the time all benefit payments
under the Plan have been made. All assets in the Trust at termination shall
be returned to Employer.
SECTION 13. MISCELLANEOUS.
(a) Any provision of this Trust Agreement prohibited by law shall be
ineffective to the extent of any such prohibition, without invalidating the
remaining provisions hereof.
(b) Benefits payable to Plan participants and their beneficiaries under
this Trust Agreement may not be anticipated, assigned (either at law or in
equity), alienated, pledged, encumbered or subjected to attachment,
garnishment, levy, execution or other legal or equitable process.
(c) This Trust Agreement shall be governed by and construed in
accordance with the laws of the State of Indiana.
Page 34
<PAGE>
SECTION 14. EFFECTIVE DATE.
The effective date of this Trust Agreement shall be March 1, 1997.
First Merchants Corporation First Merchants Bank, N.A.
By: /s/ Stefan S. Anderson By: /s/ Roger W. Gilcrest
------------------------------ --------------------------
Title: President Title: Executive Vice President
--------------------------- -----------------------
EMPLOYER TRUSTEE
Page 35
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-27.1
<SEQUENCE>4
<DESCRIPTION>EXHIBIT 27.1
<TEXT>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FIRST
MERCHANTS CORPORATION'S CONSOLIDATED CONDENSED FINANCIAL STATEMENTS (UNAUDITED)
FOR QUARTER ENDED MARCH 31, 1997 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 35,020
<INT-BEARING-DEPOSITS> 371
<FED-FUNDS-SOLD> 1,560
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 230,973
<INVESTMENTS-CARRYING> 42,442
<INVESTMENTS-MARKET> 42,382
<LOANS> 652,926
<ALLOWANCE> 6,883
<TOTAL-ASSETS> 987,831
<DEPOSITS> 781,893
<SHORT-TERM> 71,626
<LIABILITIES-OTHER> 8,072
<LONG-TERM> 12,450
<PREFERRED-MANDATORY> 0
<PREFERRED> 0
<COMMON> 827
<OTHER-SE> 112,963
<TOTAL-LIABILITIES-AND-EQUITY> 987,831
<INTEREST-LOAN> 13,822
<INTEREST-INVEST> 3,988
<INTEREST-OTHER> 74
<INTEREST-TOTAL> 17,884
<INTEREST-DEPOSIT> 7,502
<INTEREST-EXPENSE> 8,343
<INTEREST-INCOME-NET> 9,541
<LOAN-LOSSES> 287
<SECURITIES-GAINS> 10
<EXPENSE-OTHER> 6,206
<INCOME-PRETAX> 5,180
<INCOME-PRE-EXTRAORDINARY> 3,429
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 3,429
<EPS-PRIMARY> .52
<EPS-DILUTED> .52
<YIELD-ACTUAL> 0
<LOANS-NON> 0
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 0
<CHARGE-OFFS> 0
<RECOVERIES> 0
<ALLOWANCE-CLOSE> 0
<ALLOWANCE-DOMESTIC> 0
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-27.2
<SEQUENCE>5
<DESCRIPTION>EXHIBIT 27.2
<TEXT>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION FOR FIRST MERCHANTS
CORPORATION FOR QUARTER ENDED MARCH 31, 1996 RESTATED AS A RESULT OF POOLING OF
INTEREST TRANSACTIONS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> MAR-31-1996
<CASH> 26,739
<INT-BEARING-DEPOSITS> 360
<FED-FUNDS-SOLD> 13,575
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 229,658
<INVESTMENTS-CARRYING> 56,700
<INVESTMENTS-MARKET> 56,967
<LOANS> 565,045
<ALLOWANCE> 6,554
<TOTAL-ASSETS> 916,480
<DEPOSITS> 753,458
<SHORT-TERM> 40,324
<LIABILITIES-OTHER> 7,864
<LONG-TERM> 9,000
<PREFERRED-MANDATORY> 0
<PREFERRED> 0
<COMMON> 821
<OTHER-SE> 105,031
<TOTAL-LIABILITIES-AND-EQUITY> 916,480
<INTEREST-LOAN> 12,498
<INTEREST-INVEST> 4,201
<INTEREST-OTHER> 311
<INTEREST-TOTAL> 17,010
<INTEREST-DEPOSIT> 7,365
<INTEREST-EXPENSE> 8,037
<INTEREST-INCOME-NET> 8,973
<LOAN-LOSSES> 280
<SECURITIES-GAINS> 17
<EXPENSE-OTHER> 5,822
<INCOME-PRETAX> 4,843
<INCOME-PRE-EXTRAORDINARY> 3,187
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 3,187
<EPS-PRIMARY> .49
<EPS-DILUTED> .49
<YIELD-ACTUAL> 0
<LOANS-NON> 0
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 0
<CHARGE-OFFS> 0
<RECOVERIES> 0
<ALLOWANCE-CLOSE> 0
<ALLOWANCE-DOMESTIC> 0
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-27.3
<SEQUENCE>6
<DESCRIPTION>EXHIBIT 27.3
<TEXT>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 9
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION FOR FIRST MERCHANTS
CORPORATION FOR QUARTER ENDED MARCH 31, 1995 RESTATED AS A RESULT OF POOLING OF
INTEREST TRANSACTIONS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> MAR-31-1995
<CASH> 32,614
<INT-BEARING-DEPOSITS> 162
<FED-FUNDS-SOLD> 3,675
<TRADING-ASSETS> 0
<INVESTMENTS-HELD-FOR-SALE> 142,270
<INVESTMENTS-CARRYING> 126,798
<INVESTMENTS-MARKET> 126,142
<LOANS> 531,493
<ALLOWANCE> 6,709
<TOTAL-ASSETS> 862,922
<DEPOSITS> 712,541
<SHORT-TERM> 38,113
<LIABILITIES-OTHER> 6,538
<LONG-TERM> 8,000
<PREFERRED-MANDATORY> 0
<PREFERRED> 0
<COMMON> 610
<OTHER-SE> 95,588
<TOTAL-LIABILITIES-AND-EQUITY> 862,922
<INTEREST-LOAN> 11,599
<INTEREST-INVEST> 3,835
<INTEREST-OTHER> 76
<INTEREST-TOTAL> 15,508
<INTEREST-DEPOSIT> 6,096
<INTEREST-EXPENSE> 6,831
<INTEREST-INCOME-NET> 8,677
<LOAN-LOSSES> 236
<SECURITIES-GAINS> 23
<EXPENSE-OTHER> 5,815
<INCOME-PRETAX> 4,418
<INCOME-PRE-EXTRAORDINARY> 2,924
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,924
<EPS-PRIMARY> .45
<EPS-DILUTED> .45
<YIELD-ACTUAL> 0
<LOANS-NON> 0
<LOANS-PAST> 0
<LOANS-TROUBLED> 0
<LOANS-PROBLEM> 0
<ALLOWANCE-OPEN> 0
<CHARGE-OFFS> 0
<RECOVERIES> 0
<ALLOWANCE-CLOSE> 0
<ALLOWANCE-DOMESTIC> 0
<ALLOWANCE-FOREIGN> 0
<ALLOWANCE-UNALLOCATED> 0
</TABLE>
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
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