As filed with the Securities and Exchange Commission on December 21, 2001
Registration No. 333-________
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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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FIRST MERCHANTS CAPITAL TRUST I
FIRST MERCHANTS CAPITAL TRUST II
FIRST MERCHANTS CORPORATION FIRST MERCHANTS CAPITAL TRUST III
(Exact Name of Registrant as (Exact Name of Registrant as
Specified in its Charter) Specified in its Trust Agreement)
Indiana Delaware
(State or Other Jurisdiction of (State or Other Jurisdiction of Incorporation
Incorporation or Organization) or Organization of Each Registrant)
51-6523248
51-6523249
35-1544218 51-6523250
(I.R.S. Employer Identification No.) (I.R.S. Employer Identification No.'s,
respectively)
200 East Jackson Street, Muncie, Indiana 47305 (765) 747-1500
(Address, including Zip Code, and Telephone Number, including Area Code, of
Registrants' and co-Registrants' Principal Executive
Offices)
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Michael L. Cox
President
200 East Jackson Street
Muncie, Indiana 47305
(765) 747-1500
(Name, Address, including Zip Code, and Telephone Number, including Area Code,
of Agent for Service)
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Copies to:
David R. Prechtel
Bingham, Summers, Welsh & Spilman, LLP
10 West Market Street
2700 Market Tower
Indianapolis, Indiana 46204
(317) 635-8900
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Approximate date of commencement of proposed sale of the securities to the
public: From time to time after the effective date of this Registration
Statement, as determined in light of market conditions and other factors.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. |_|
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. |X|
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
registration statement for the same offering. |_| _______
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering.
|_| __________
If delivery of the prospectus is expected to be made pursuant to Rule 434
under the Securities Act, please check the following box. |_|
CALCULATION OF REGISTRATION FEE
===============================================================================================================
Title of Each Class of Proposed Maximum Amount of
Securities to be Registered Aggregate Offering Price (1) Registration Fee (2)
- ---------------------------------------------------------------------------------------------------------------
Trust Preferred Securities of:
- ---------------------------------------------------------------------------------------------------------------
First Merchants Capital Trust I............... (3) --
- ---------------------------------------------------------------------------------------------------------------
First Merchants Capital Trust II.............. (3) --
- ---------------------------------------------------------------------------------------------------------------
First Merchants Capital Trust III............. (3) --
- ---------------------------------------------------------------------------------------------------------------
Junior Subordinated Debentures of First
Merchants Corporation ........................... (3) --
- ---------------------------------------------------------------------------------------------------------------
Guarantees by First Merchants Corporation of
Trust Preferred Securities (4)................... -- --
- ---------------------------------------------------------------------------------------------------------------
Total (5).......................................... $70,000,000 $18,750
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(1) The proposed maximum offering price per unit will be determined from time
to time by the registrants in connection with the issuance by the
registrants of the securities registered hereunder.
(2) The proposed maximum aggregate offering price has been estimated solely for
the purpose of calculating the registration fee pursuant to Rule 457(o)
under the Securities Act of 1933.
(3) Subject to note 5 below, there is being registered hereunder an
indeterminate amount and number of trust preferred securities of First
Merchants Capital Trust I and First Merchants Capital Trust II and First
Merchants Capital Trust III (collectively, the "Trusts") and an
indeterminate principal amount of junior subordinated debentures of First
Merchants Corporation. A like amount of junior subordinated debentures may
be issued and sold by First Merchants Corporation to any of the Trusts, in
which event such junior subordinated debentures may later be distributed
for no additional consideration to the holders of the trust preferred
securities of such Trust upon a dissolution of such Trust and the
distribution of the assets thereof.
(4) First Merchants Corporation will not receive separate consideration for the
guarantee of the trust preferred securities. The guarantee includes the
rights of holders of trust preferred securities under the guarantee and
certain back-up undertakings, as described in this Registration Statement.
(5) In no event will the aggregate offering price of all securities issued from
time to time pursuant to this Registration Statement exceed $70,000,000.
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The registrants hereby amend this registration statement on such date or
dates as may be necessary to delay its effective date until the registrants
shall file a further amendment which specifically states that this registration
statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933, or until this registration statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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The information in this preliminary prospectus is not complete and may be
changed. We may not sell these securities until the registration statement filed
with the Securities and Exchange Commission is effective. This preliminary
prospectus is not an offer to sell these securities and it is not soliciting an
offer to buy these securities in any state where the offer or sale is not
permitted.
Subject to Completion, Dated December 21, 2001
Prospectus
$70,000,000
First Merchants Capital Trust I
First Merchants Capital Trust II
First Merchants Capital Trust III
Trust Preferred Securities
Guaranteed by
[FIRST MERCHANTS LOGO APPEARS HERE]
The Trusts:
The trusts are Delaware business trusts and wholly owned subsidiaries of
First Merchants Corporation. Each trust may in one or more offerings:
o offer and sell preferred securities representing undivided beneficial
interests in the assets of the trust to the public;
o offer and sell common securities representing undivided beneficial
interests in the assets of the trusts to First Merchants Corporation;
o use the proceeds from these sales to buy an equal principal amount of
debentures of First Merchants Corporation; and
o distribute the cash payments it receives on the debentures it owns to
the holders of each trust's preferred and common securities.
Distributions:
o For each preferred security that you own, you will receive cumulative
cash distributions at a rate set forth in the applicable prospectus
supplement on the liquidation amount of the preferred security. The
liquidation amount per preferred security will be set forth in the
applicable prospectus supplement.
Limited Guarantee:
o First Merchants Corporation will provide a limited guarantee of the
payment by the trusts of distributions on the preferred securities and
upon liquidation and redemption.
The aggregate initial offering price of the preferred securities that the
trusts offer by this prospectus will not exceed $70,000,000. The trusts will
offer the preferred securities in amounts, at prices and on terms to be
determined by market conditions at the time of the offerings. We will provide
specific terms of the preferred securities in supplements to this prospectus.
You should read this prospectus and any supplements carefully before you invest.
The preferred securities are not deposits or other obligations of a bank
and are not insured or guaranteed by the Federal Deposit Insurance Corporation
or any other governmental agency.
Neither the Securities and Exchange Commission nor any other regulatory
body has approved or disapproved of these securities or passed upon the accuracy
or adequacy of this prospectus. Any representation to the contrary is a criminal
offense.
Prospectus dated ________________, 2002
TABLE OF CONTENTS
Page
----
About This Prospectus.........................................................1
Special Note Regarding Forward Looking Statements.............................1
First Merchants Corporation...................................................2
Description of the Trusts.....................................................3
Ratios of Earnings to Fixed Charges...........................................5
Use of Proceeds...............................................................6
Accounting Treatment..........................................................6
Description of the Preferred Securities.......................................6
Description of the Debentures.................................................7
Description of the Guarantees................................................12
Relationship Among the Preferred Securities,
the Debentures and the Guarantee...........................................15
Plan of Distribution.........................................................17
Legal Opinions...............................................................18
Experts......................................................................18
Where You Can Get More Information...........................................18
Documents Incorporated by Reference .........................................19
ABOUT THIS PROSPECTUS
This prospectus may not be used to sell securities unless it is accompanied
by a prospectus supplement.
This prospectus is part of a registration statement that we, First
Merchants Capital Trust I, First Merchants Capital Trust II and First Merchants
Capital Trust III, filed with the Securities and Exchange Commission utilizing a
"shelf" registration process. Under this shelf process, we may from time to time
issue guarantees and debentures to the trusts as described in this prospectus
and the trusts may sell the trust preferred securities described in this
prospectus in one or more offerings up to a total dollar amount of $70,000,000.
This prospectus provides you with a general description of the securities that
we and the trusts may offer. Each time we sell securities, we will provide a
prospectus supplement that will contain specific information about the terms of
that offering. The prospectus supplement may also add, update or change
information contained in this prospectus. If there is any inconsistency between
the information in this prospectus and any prospectus supplement, you should
rely on the information in the prospectus supplement. The registration statement
filed with the SEC includes exhibits that provide more details about the matters
discussed in this prospectus. You should read this prospectus, the related
exhibits filed with the SEC and any prospectus supplement, together with the
additional information described below under the headings "Where You Can Get
More Information" and "Documents Incorporated by Reference."
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
We make certain forward-looking statements in this prospectus and any
prospectus supplement that are based upon current expectations and projections
about current events. We intend these forward-looking statements to be covered
by the safe harbor provisions for forward looking statements contained in the
Private Securities Litigation Reform Act of 1995, and we are including this
statement for purposes of these safe harbor provisions. You can identify these
statements from our use of the words "estimate," "project," "believe," "intend,"
"should," "focus," "anticipate," "expect" and similar expressions. The
forward-looking statements include:
o statements of our goals, intentions and expectations;
o statements regarding our business plans and growth strategies;
o statements regarding the asset quality of our loan and investment
portfolios; and
o estimates of our risks and future costs and benefits.
These forward-looking statements are subject to significant risks,
assumptions and uncertainties, including, among other things, the following
important factors which could affect the actual outcome of future events:
o fluctuations in market rates of interest and loan and deposit pricing,
which could negatively affect our net interest margin, asset
valuations and expense expectations;
o adverse changes in the economy of the northeastern and north-central
Indiana area, which might affect our business prospects and could
cause credit-related losses and expenses;
o adverse developments in our loan and investment portfolios;
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o competitive factors in the banking industry, such as the trend towards
consolidation in our market; and
o changes in banking legislation or the regulatory requirements of
federal and state agencies applicable to bank holding companies and
banks like ours.
Because of these and other uncertainties, our actual future results may be
materially different from the results indicated by these forward-looking
statements. In addition, our past results of operations do not necessarily
indicate our future results.
FIRST MERCHANTS CORPORATION
First Merchants Corporation, headquartered in Muncie, Indiana, is a
multi-bank holding company organized in 1982 under the laws of the State of
Indiana. First Merchants Corporation is also a financial holding company.
First Merchants Corporation was originally formed as the bank holding
company for First Merchants Bank, National Association. Since that time, First
Merchants Corporation has acquired Pendleton Banking Company, First United Bank,
The Union County National Bank of Liberty, The Randolph County Bank, The First
National Bank of Portland, Anderson Community Bank, Decatur Bank & Trust Company
and Frances Slocum Bank & Trust Company. Each of such banks operates as a
wholly-owned subsidiary of First Merchants Corporation with the exception of
Pendleton Banking Company and Anderson Community Bank which were merged and
operate under the name "The Madison Community Bank."
First Merchants Corporation provides commercial and retail banking services
in Delaware, Adams, Madison, Henry, Union, Wayne, Fayette, Randolph, Jay,
Wabash, Miami, Hamilton and Howard counties in the State of Indiana, through the
54 offices of its 8 bank subsidiaries. These banks provide a wide range of
retail and commercial banking services, including:
o demand, savings and time deposits;
o agricultural, commercial, industrial, consumer and real estate loans;
o installment credit lending;
o safe deposit facilities;
o collections;
o fiduciary and trust services; and
o other general services related to the banking business.
First Merchants Corporation's bank subsidiaries make and service both
secured and unsecured loans to individuals, firms and corporations. Their
installment loan departments make direct loans to individuals and purchase
installment obligations from retailers without recourse.
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Through various nonbank subsidiaries, First Merchants Corporation also
engages in the general insurance business, the title insurance agency business
and the reinsurance of credit life, accident and health insurance.
First Merchants Corporation anticipates that it will continue its policy of
geographic expansion of its banking business through the acquisition of banks
whose operations are consistent with its community banking philosophy.
Management routinely explores opportunities to acquire financial institutions
and other financial services-related businesses and to enter into strategic
alliances to expand the scope of its services and its customer base. On October
15, 2001, First Merchants Corporation and Lafayette Bancorporation jointly
announced the signing of a definitive agreement pursuant to which Lafayette
Bancorporation will be merged with and into First Merchants Corporation. As a
result of the merger, Lafayette Bank and Trust Company will become a
wholly-owned subsidiary of First Merchants Corporation. Subject to various
contingencies, the merger is expected to be completed in the second quarter of
2002.
First Merchant Corporation's principal office is located at 200 East
Jackson Street, Muncie, Indiana 47305. Its telephone number is (765) 747-1500.
DESCRIPTION OF THE TRUSTS
Each trust is a statutory business trust formed pursuant to the Delaware
Business Trust Act under trust agreements executed by us, as sponsor for the
trusts, and the trustees, and certificates of trust have been filed with the
Delaware Secretary of State. Each trust agreement will be amended and restated
in its entirety in substantially the form filed as an exhibit to the
registration statement of which this prospectus is a part, as of the date each
of the preferred securities are initially issued. Each of the trust agreements
will be qualified under the Trust Indenture Act of 1939.
The following discussion contains a description of the material terms of
the trust agreements for the trusts and is subject to, and is qualified in its
entirety by reference to, the amended and restated trust agreements.
The holders of the preferred securities issued by a trust will own all of
the issued and outstanding preferred securities of such trust which will have
certain prior rights over the other securities of such trust. We will not
initially own any of the preferred securities issued by any trust. We will
acquire the common securities of each of the trusts in an amount equal to at
least 3% of the total capital of each of the trusts and will initially own,
directly or indirectly, all of the issued and outstanding common securities of
each of the trusts. The common securities that may be issued by a trust,
together with the preferred securities of such trust, are called the trust
securities.
Each trust exists for the exclusive purposes of:
o issuing and selling its preferred securities to the public for cash;
o issuing and selling its common securities to us in exchange for our
capital contribution to such trust;
o investing the proceeds from the sale of its trust securities in an
equivalent amount of debentures issued by us; and
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o engaging in other activities that are incidental to those listed
above, such as receiving payments on the debentures it purchases from
us and making distributions to holders of its trust securities,
furnishing notices and other administrative tasks.
None of the trusts will have any independent business operations or any
assets, revenues or cash flows other than those related to the issuance and
administration of the trust securities.
The rights of the holders of each trust's preferred securities will be set
forth in the amended and restated trust agreement relating to such trust, the
Delaware Business Trust Act and the Trust Indenture Act. None of the trusts,
under their respective trust agreements, may borrow money or make any investment
other than in the debentures to be issued by us. Other than with respect to
payment of distributions on and the liquidation amount of the trust securities,
First Merchants Corporation has agreed to pay for all debts and obligations and
all costs and expenses of each of the trusts, including the fees and expenses of
the trustees and any income taxes, duties and other governmental charges, and
all costs and expenses related to these charges, to which each of the trusts may
become subject, except for United States withholding taxes that are properly
withheld.
Unless otherwise specified in the applicable prospectus supplement, each of
the trusts will initially have five trustees. Three of the trustees for each
trust will be persons who are employees or officers of, or who are affiliated
with, First Merchants Corporation. They are administrative trustees. The fourth
trustee for each trust will be an entity that maintains its principal place of
business in the State of Delaware. It is the Delaware trustee. Initially, First
Union Trust Company, National Association, will act as Delaware trustee for each
of the trusts. The fifth trustee for each trust, called the property trustee,
will also be First Union Trust Company, National Association initially. The
property trustee is the institutional trustee under each of the trust agreements
and acts as the indenture trustee called for under the applicable provisions of
the Trust Indenture Act. Also for purposes of compliance with the Trust
Indenture Act, First Union Trust Company, National Association will initially
act as guarantee trustee and indenture trustee under each the of the guarantees
and the indentures.
We, as holder of all of the common securities of each of the trusts, will
have the right to appoint or remove any trustee unless an event of default under
the indenture has occurred and is continuing, in which case only the holders of
the preferred securities of the indenture so affected may remove the Delaware
trustee or the property trustee. Each of the trusts has a term of approximately
31 years but may terminate earlier as provided in the respective trust
agreement.
The property trustee will hold the debentures for the benefit of the
holders of each trust's trust securities and will have the power to exercise all
rights, powers and privileges under the indenture as the holder of the
debentures. In addition, unless a separate paying agent is appointed by First
Merchants Corporation, the property trustee will maintain exclusive control of a
segregated noninterest-bearing "payment account" to hold all payments made on
the distributions for the benefit of the holders of each trust's trust
securities. The property trustee will make payments of distributions and
payments on liquidation, redemption and otherwise to the holders of each trust's
trust securities out of funds from each trust's payment account. The guarantee
trustee will hold the guarantee for the benefit of the holders of each of the
trust's preferred securities. We will pay all fees and expenses related to the
trusts and the offering of the preferred securities of each of the trusts,
including fees and expenses of the trustees.
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RATIOS OF EARNINGS TO FIXED CHARGES
The following table sets forth First Merchants Corporation's consolidated
ratios of earnings to fixed charges for the periods shown:
Nine Months Ended Years Ended December 31,
September 30, 2001 ----------------------------------------------
------------------ 2000 1999 1998 1997 1996
---- ---- ---- ---- ----
Ratio of Earnings to Fixed
Charges(1):
Including interest
expense on deposits....................... 1.50x 1.49x 1.62x 1.62x 1.61x 1.62x
Excluding interest expense on deposits.... 4.24x 3.73x 4.49x 6.98x 7.26x 7.26x
(1) For purposes of computing the ratios of earnings to fixed charges, earnings
represent income before income taxes plus fixed charges. Fixed charges,
excluding interest on deposits, includes gross interest expense less
interest on deposits. Fixed charges, including interest on deposits,
includes all gross interest expense.
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USE OF PROCEEDS
Each trust will use all the proceeds of the preferred securities to acquire
debentures from First Merchants Corporation. We intend to use the net proceeds
from the sale of the debentures to the trusts for general corporate purposes
unless otherwise indicated in the prospectus supplement. Our general corporate
purposes may include financing our growth through acquisitions. The precise
amounts and the timing of our use of the net proceeds will depend upon our need
to finance future acquisitions and the availability of other funds. Until we use
the net proceeds for general corporate purposes, we will use the net proceeds to
reduce our short-term indebtedness or for temporary investments.
ACCOUNTING TREATMENT
Each trust will be treated as a subsidiary of First Merchants Corporation
for financial reporting purposes. Accordingly, First Merchants Corporation's
consolidated financial statements will include the accounts of each trust. The
preferred securities, along with other preferred securities that First Merchants
Corporation guarantees on an equivalent basis, will be presented as a separate
line item in First Merchants Corporation's consolidated balance sheets. First
Merchants Corporation will record distributions that each trust pays on the
preferred securities as an expense in its consolidated statement of income.
DESCRIPTION OF THE PREFERRED SECURITIES
Each trust may issue only one series of preferred securities. The trust
agreement of each trust will authorize the administrative trustees to issue the
preferred securities of that trust on behalf of that trust. For additional
information you should refer to the applicable trust agreement, as amended in
connection with the issuance of the preferred securities. The form of trust
agreement is an exhibit to the registration statement, of which this prospectus
is a part.
The prospectus supplement for a particular series of preferred securities
being offered will disclose the specific terms related to the offering,
including the price or prices at which the preferred securities to be offered
will be issued. Those terms will include some or all of the following:
o the title of the series of preferred securities;
o the number and initial offering price of preferred securities issued
by the applicable trust;
o the annual distribution rate (or method of determining such rate) for
preferred securities issued by a trust and the date or dates upon
which the distributions are payable;
o the date or dates or method of determining the date or dates from
which distributions on preferred securities will be cumulative;
o the amount or amounts that will be paid out of the assets of the trust
to the holders of preferred securities upon voluntary or involuntary
dissolution, winding-up or termination of the applicable trust;
o the obligation, if any, of the applicable trust to purchase or redeem
the preferred securities and the price or prices at which, the period
or periods within which, and the terms and conditions upon which,
preferred securities will be purchased or redeemed, in whole or in
part, pursuant to that obligation;
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o the voting rights, if any, of preferred securities in addition to
those required by law, including the number of votes per preferred
security and any requirement for the approval by the holders of
preferred securities, as a condition to specified action or amendments
to a trust agreement;
o the terms and conditions, if any, upon which the debentures owned by
the applicable trust may be distributed to holders of preferred
securities;
o the terms and conditions, if any, upon which the preferred securities
may be converted into debt securities of First Merchants Corporation;
o if applicable, any securities exchange upon which the preferred
securities will be listed; and
o any other relevant rights, preferences, privileges, limitations or
restrictions of the trust securities not inconsistent with the trust
agreements or with applicable law.
First Merchants Corporation will guarantee all preferred securities offered
to the limited extent described below under "Description of the Guarantees."
We will describe in the applicable prospectus supplement any United States
federal income tax considerations applicable to an offering of preferred
securities.
DESCRIPTION OF THE DEBENTURES
Concurrently with the issuance of the preferred securities by a trust, that
trust will invest the proceeds from the sale of the preferred securities in the
debentures. First Merchants Corporation may issue debentures from time to time
in one or more series under an indenture between First Merchants Corporation and
First Union Trust Company, National Association, as indenture trustee, as
supplemented by a supplemental indenture or a resolution of our board of
directors or a special committee appointed by the board of directors. The terms
of the debentures will include those stated in the indenture as supplemented and
those made part of the indenture by reference to the Trust Indenture Act.
Below is a summary of the general terms of the debentures in which the
trusts will invest the proceeds from the issuance and sale of the trust
securities. We will describe the particular terms of the debentures in the
prospectus supplement relating to the particular trust preferred securities that
we will offer in that prospectus supplement. For additional information you
should refer to the indenture and any applicable indenture supplement. The forms
of indenture and supplemental indenture are filed as exhibits to the
registration statement which contains this prospectus, which we urge prospective
investors to read.
General
The debentures will be issued as unsecured debt of First Merchants
Corporation. The debentures will be fully subordinated to all of our senior
indebtedness. The specific terms of the subordination will be as described in
the prospectus supplement relating to the particular preferred securities being
offered. The indenture does not limit the aggregate principal amount of
debentures which may be issued and provides that the debentures may be issued
from time to time in one or more series.
The prospectus supplement relating to the particular series of preferred
securities being offered will also describe the terms of the related debentures,
which may include:
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o the designation of the debentures;
o the aggregate principal amount of the debentures;
o the percentage of their principal amount at which the debentures will
be issued and any payments due if their maturity is accelerated;
o the date or dates on which the debentures will mature and the right,
if any, to shorten or extend the maturity date or dates;
o the rate or rates, if any, per annum, at which the debentures will
bear interest, or the method of determination of the interest rate or
rates;
o the date or dates from which interest will accrue and the interest
payment and record dates;
o the right, if any, to extend the interest payment periods and the
duration of that extension;
o provisions, if any, for a sinking purchase or other similar fund;
o any provisions for redemption; and
o any other specific terms of the debentures.
Payment
We will pay or deliver principal and any premium and interest in the
manner, at the places and subject to the restrictions set forth in the indenture
and applicable indenture supplement and prospectus supplement. At our option, we
may pay any interest by check mailed to the holders of registered debentures at
their registered address.
Limitations on Transactions
We are restricted from making certain payments (as described below) if an
event of default has occurred and is continuing under the indenture or any
supplement thereto, if we chose to defer payment of interest on the debentures
by extending the interest payment period as provided in the indenture or any
supplement thereto, or if we are in default with respect to our obligations
under the guarantee relating to a trust.
If any of these events occur, we will not:
o pay any dividend on, make any distributions with respect to, or
redeem, purchase, acquire or make a liquidation payment with respect
to, any of our capital stock (other than (A) dividends or
distributions in our common stock, or any declaration of a non-cash
dividend in connection with the implementation of a shareholder rights
plan, or the issuance of stock under any such plan in the future, or
the redemption or repurchase of any such rights pursuant thereto, (B)
purchases of our common stock related to the rights under any of the
benefit plans for our directors, officers or employees, or (C) as a
result of a reclassification of our capital stock into another class
of our capital stock);
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o make any payment of interest, principal or premium, if any, or repay,
repurchase or redeem any debt securities issued by us which rank pari
passu with or junior to the debentures of such series or make any
guarantee payments with respect to any guarantee by us of the debt
securities of any subsidiary of ours if such guarantee ranks pari
passu with or junior in interest to the debentures of such series,
except that we may make payments pursuant to our obligations under the
guarantee relating to such trust; and
o redeem, purchase or acquire less than all of the outstanding
debentures of such series or any of the preferred securities relating
to such trust.
Subordination
The debentures will be unsecured and will be subordinated and junior in
right of payment to all senior indebtedness of First Merchants Corporation to
the extent described in the applicable prospectus supplement. The debentures
purchased by each trust will be of equal priority to the debentures purchased by
any other trust.
Consolidation, Merger, Sale of Assets and Other Transactions
We may not consolidate with or merge into any other entity or convey or
transfer our properties and assets substantially as an entirety to any entity,
and no entity may be consolidated with or merged into us or sell, convey,
transfer or otherwise dispose of its assets substantially as an entirety to us,
unless:
o if we consolidate with or merge into another entity or transfer our
properties and assets substantially as an entirety to any entity, the
successor entity is organized under the laws of the United States or
any state or the District of Columbia, and the successor entity
expressly assumes by supplemental indenture our obligations on the
debentures, and the ultimate parent entity of the successor entity
expressly assumes our obligations under each of the guarantees, to the
extent the preferred securities of each of the trusts are outstanding;
o immediately after the transaction, no event of default under the
indenture or any supplement thereto, and no event which, after notice
or lapse of time, or both, would become an event of default under the
indenture or any supplement thereto, has occurred and is continuing;
and
o other conditions as prescribed in the indentures are met.
Debenture Events of Default
The indenture provides that any one or more of the following events with
respect to the debentures that has occurred and is continuing constitutes an
event of default under the indenture:
o our failure to pay any interest on the debentures for 30 days after
the due date, except where we have properly deferred the interest
payment;
o our failure to pay any principal on the debentures when due whether at
maturity, upon redemption or otherwise;
o our failure to observe or perform in any material respect any other
covenants or agreements contained in the indenture or applicable
supplemental indenture for 90 days
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after written notice to us from the indenture trustee or the holders
of at least 25% in aggregate principal amount of the debentures of
that series then outstanding; or
o our bankruptcy, insolvency, reorganization in bankruptcy or
dissolution.
The holders of a majority in aggregate outstanding principal amount of the
debentures of any or all series affected generally have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the indenture trustee. The indenture trustee, or the holders of at least 25% in
aggregate principal amount of the debentures of that series then outstanding may
declare the principal of all debentures of that series due and payable
immediately upon an event of default under the applicable indenture. The holders
of a majority of the outstanding principal amount of the affected series of the
debentures may rescind and annul the declaration and waive the default if the
default has been cured and a sum sufficient to pay all matured installments of
interest and principal due otherwise than by acceleration has been deposited
with the indenture trustee as long as the holders of a majority in liquidation
amount of the trust securities have consented to the waiver of the default. The
holders may not annul the declaration and waive a default if the default is the
non-payment of the principal of the debentures which has become due solely by
the acceleration.
So long as the property trustee is the holder of the debentures, if an
event of default under the indenture has occurred and is continuing, the
property trustee will have the right to declare the principal of and the
interest on the affected series of the debentures, and any other amounts payable
under the indenture, to be immediately due and payable and to enforce its other
rights as a creditor with respect to the debentures.
We are required to file annually with the indenture trustee a certificate
as to whether or not we are in compliance with all of the conditions and
covenants applicable to us under the indentures.
Additional Sums to be Paid as a Result of Additional Taxes
If, at any time a trust or the property trustee is required to pay any
additional taxes, duties, assessments or other governmental charges of whatever
nature, other than withholding taxes, imposed by the United States, or any other
taxing authority, we will pay as additional interest on the debentures any
amounts which may be required so that the net amounts received and retained by a
trust after paying any additional taxes, duties, assessments or other
governmental charges will not be less than the amounts a trust and the property
trustee would have received had the additional taxes, duties, assessments or
other governmental charges not been imposed.
Distribution Upon Liquidation
Under certain circumstances and with the Federal Reserve's approval if
required by law or regulation, the debentures may be distributed to the holders
of the preferred securities in liquidation of a trust after satisfaction of the
liabilities to creditors of the affected trust. If this occurs, we will use our
best efforts to list the debentures so affected on the Nasdaq National Market or
other national securities exchange or national quotation system on which the
preferred securities are then listed, if any. There can be no assurances as to
the market price of any debentures that may be distributed to the holders of the
preferred securities so affected.
Modification of the Indenture
We and the indenture trustee may, from time to time, without the consent of
the holders of debentures, amend, waive our rights under or supplement the
indenture for purposes which do not
10
materially adversely affect the rights of the holders of the debentures. Other
changes may be made by us and the indenture trustee with the consent of the
holders of a majority in principal amount of the series of affected outstanding
debentures. However, without the consent of the holders of each outstanding
debenture of the series affected by the proposed modification, no modification
may:
o extend the maturity date of the debentures; or
o reduce the principal amount or the rate or extend the time of payment
of interest; or
o reduce the percentage of principal amount of the debentures required
to amend the indenture.
As long as any of the preferred securities remain outstanding, no
modification of the indenture or any applicable supplement thereto may be made
that requires the consent of the holders of the applicable debentures, no
termination of the indenture or any supplement thereto may occur, and no waiver
of any event of default under the indenture or any supplement thereto may be
effective, without the prior consent of the holders of a majority of the
aggregate liquidation amount of the preferred securities so affected.
Satisfaction and Discharge
The indenture will cease to be of further effect and we will be deemed to
have satisfied and discharged our obligations under the indenture when all
debentures not previously delivered to the indenture trustee for cancellation:
o have become due and payable, and
o will become due and payable at their stated maturity within one year
or are to be called for redemption within one year, and we deposit or
cause to be deposited with the indenture trustee funds, in trust, for
the purpose and in an amount sufficient to pay and discharge the
entire indebtedness on the debentures not previously delivered to the
indenture trustee for cancellation, for the principal and interest due
to the date of deposit or to the stated maturity or redemption date,
as the case may be.
We may still be required to provide officers' certificates and opinions of
counsel any pay fees and expenses due after these events occur.
Governing Law
The indenture and the debentures will be governed by, and construed in
accordance with, the internal laws of the State of Indiana.
Information Concerning the Indenture Trustee
The indenture trustee is subject to all the duties and responsibilities
specified with respect to an indenture trustee under the Trust Indenture Act.
Subject to these provisions, the indenture trustee is under no obligation to
exercise any of the powers vested in it by the indenture at the request of any
holder of debentures, unless offered reasonable security or indemnity by the
holder against the costs, expenses, and liabilities which might be incurred. The
indenture trustee is not required to expend or risk its own funds or otherwise
incur personal financial liability in the performance of its duties if the
11
indenture trustee reasonably believes that repayment or adequate indemnity is
not reasonably assured to it.
Miscellaneous
In the event a series of debentures is issued to a trust or a trustee of
such trust in connection with the issuance of trust securities by such trust, so
long as the applicable trust securities remain outstanding, we have agreed in
the indenture:
o to maintain 100% direct or indirect ownership of the common securities
of such trust, except that successors that are permitted pursuant to
the indenture or any supplement thereto may succeed to our ownership
of the common securities of such trust;
o not to voluntarily terminate, wind up or liquidate such trust, except
upon prior approval of the Federal Reserve if required by law or
regulation;
o to use our reasonable efforts to cause such trust (a) to remain a
business trust (and to avoid involuntary termination, winding up or
liquidation), except in connection with a distribution of the
debentures of such series, the redemption of all of the trust
securities of such trust or certain mergers, consolidations or
amalgamations, each as permitted by the trust agreement of such trust;
and (b) to otherwise continue not to be treated as an association
taxable as a corporation or partnership for United States federal
income tax purposes;
o to use our reasonable efforts to cause each holder of preferred
securities of such trust to be treated as owning an undivided
beneficial interest in the debentures of such series; and
o to use our best efforts to maintain the eligibility of such preferred
securities for quotation or listing on any national securities
exchange or other organization on which such preferred securities are
then quoted or listed (including, if applicable, The Nasdaq National
Market) and to use our best efforts to keep such preferred securities
so quoted or listed for so long as such preferred securities remain
outstanding.
DESCRIPTION OF THE GUARANTEES
Set forth below is a summary of information concerning the guarantees which
we will execute and deliver in connection with a particular offering for the
benefit of the holders of preferred securities. The guarantee agreements will be
executed and delivered by us concurrently with the issuance of the corresponding
preferred securities for the benefit of the holders of those preferred
securities. The guarantee agreements will be qualified as indentures under the
Trust Indenture Act. First Union Trust Company, National Association, the
guarantee trustee, will act as trustee for purposes of complying with the
provisions of the Trust Indenture Act, and will also hold the guarantees for the
benefit of the holders of the preferred securities. The following discussion
contains a description of the material provisions of the guarantees and is
subject to, and is qualified in its entirety by reference to, the guarantee
agreements and the Trust Indenture Act. Prospective investors are urged to read
the form of the guarantee agreements which have been filed as an exhibit to the
registration statement of which this prospectus forms a part.
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General
Under each guarantee, we will agree to pay in full on a subordinated basis,
to the extent described in each guarantee agreement, the guarantee payments (as
defined below) to the holders of the preferred securities, as and when due,
regardless of any defense, right of set-off or counterclaim that the applicable
trust may have or assert other than the defense of payment.
The following payments with respect to the preferred securities are called
the "guarantee payments" and, to the extent not paid or made by the applicable
trust and to the extent that that trust has funds available for those
distributions, will be subject to the guarantee:
o any accumulated and unpaid distributions required to be paid on the
preferred securities;
o with respect to any preferred securities called for redemption, the
redemption price; and
o upon a voluntary or involuntary dissolution, winding up or termination
of a trust (other than in connection with the distribution of
debentures to the holders of preferred securities in exchange for
preferred securities) the lesser of:
o the amount of the liquidation distribution; and
o the amount of assets of the trust remaining available for distribution
to holders of preferred securities in liquidation of the trust.
We may satisfy our obligations to make a guarantee payment by making a
direct payment of the required amounts to the holders of the related preferred
securities or by causing the applicable trust to pay the amounts to the holders.
Each guarantee agreement is a guarantee, on a subordinated basis, of the
guarantee payments, but the guarantee only applies to the extent the applicable
trust has funds available for those distributions. If we do not make interest
payments on the debentures purchased by the applicable trust, that trust will
not have funds available to make the distributions and will not pay
distributions on the corresponding preferred securities.
Amendments
Except with respect to any changes which do not adversely affect the rights
of holders of trust preferred securities, in which case no consent will be
required, the guarantees may be amended only with the prior approval of the
holders of not less than a majority in aggregate liquidation amount of the
applicable outstanding preferred securities.
Termination of the Guarantees
Each of the guarantees will terminate and be of no further force and effect
upon:
o full payment of the redemption price of the preferred securities;
o full payment of the amounts payable upon liquidation of the trust; or
o distribution of the debentures to the holders of the preferred
securities.
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If at any time any holder of the preferred securities must restore payment
of any sums paid under the preferred securities or a guarantee, the
corresponding guarantee will continue to be effective or will be reinstated with
respect to such amounts.
Events of Default; Remedies
An event of default under a guarantee agreement will occur upon our failure
to make a required guarantee payment or to perform any other obligations under
such guarantee. If the guarantee trustee obtains actual knowledge that an event
of default has occurred and is continuing, the guarantee trustee must enforce
the applicable guarantee for the benefit of the holders of the preferred
securities so affected. The holders of a majority in aggregate liquidation
amount of the preferred securities so affected will have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the guarantee trustee in respect of the applicable guarantee and may direct the
exercise of any power conferred upon the guarantee trustee under the applicable
guarantee agreement.
Any holder of preferred securities may institute and prosecute a legal
proceeding directly against us to enforce its rights under the applicable
guarantee without first instituting a legal proceeding against the corresponding
trust, the guarantee trustee or any other person or entity.
We are required to provide to the guarantee trustee annually a certificate
as to whether or not we are in compliance with all of the conditions and
covenants applicable to us under the guarantee agreements.
Status of the Guarantees
The guarantees constitute our unsecured obligations that rank subordinate
and junior in right of payment to all of our senior and subordinated debt in the
same manner as the debentures. We expect to incur additional indebtedness in the
future. Except in certain circumstances that may be described in any prospectus
supplement limiting our ability to issue additional preferred securities or
similar securities or indebtedness, our ability to incur additional indebtedness
is not limited.
The guarantees constitute a guarantee of payment and not of collection. If
we fail to make guarantee payments when required, holders of preferred
securities may institute a legal proceeding directly against us to enforce their
rights under the applicable guarantee without first instituting a legal
proceeding against any other person or entity.
The guarantees will not be discharged except by payment of the guarantee
payments in full to the extent not paid by the applicable trust or upon
distribution of the debentures to the corresponding holders of the preferred
securities. Because we are a bank holding company, our right to participate in
any distribution of assets of any subsidiary upon the subsidiary's liquidation
or reorganization or otherwise is subject to the prior claims of creditors of
that subsidiary, except to the extent we may be recognized as a creditor of that
subsidiary. The ability of claimants under the guarantees to realize upon the
value of any of our subsidiaries, therefore, will be subordinated to all
existing and future liabilities of our subsidiaries.
Information Concerning the Guarantee Trustee
The guarantee trustee, other than during the occurrence and continuance of
our default in performance of a guarantee, undertakes to perform only those
duties as are specifically set forth in the guarantees. When an event of default
has occurred and is continuing, the guarantee trustee must exercise the same
degree of care and skill as a prudent person would exercise or use in the
conduct of his or her own affairs. The guarantee trustee is under no obligation
to exercise any of the powers vested in it by the
14
guarantees at the request of any holder of any corresponding preferred
securities unless it is offered reasonable security and indemnity against the
costs, expenses and liabilities that might be incurred thereby; but this does
not relieve the guarantee trustee of its obligations to exercise the rights and
powers under the guarantees in the event of a default.
Expense Agreement
We will, pursuant to the agreement as to expenses and liabilities entered
into by us and each trust under the applicable trust agreement, irrevocably and
unconditionally guarantee to each person or entity to whom such trust becomes
indebted or liable, the full payment of any costs, expenses or liabilities of
such trust, other than obligations of such trust to pay to the holders of the
preferred securities or other similar interests in the trust of the amounts due
to the holders pursuant to the terms of the preferred securities or other
similar interests, as the case may be. Third party creditors of a trust may
proceed directly against us under the expense agreement, regardless of whether
they had notice of the expense agreement.
Governing Law
The guarantees will be governed by and construed in accordance with the
internal laws of the State of Indiana.
RELATIONSHIP AMONG THE PREFERRED SECURITIES,
THE DEBENTURES AND THE GUARANTEE
Full and Unconditional Guarantee
We irrevocably guarantee, as and to the extent described in this prospectus
and any supplemental prospectus, payments of distributions and other amounts due
on the preferred securities, to the extent the applicable trust has funds
available for the payment of these amounts. We and the applicable trust believe
that, taken together, our obligations under the debentures, the indenture, the
applicable trust agreement, the applicable expense agreement and the applicable
guarantee agreement provide, in the aggregate, a full, irrevocable and
unconditional guarantee, on a subordinated basis, of payment of distributions
and other amounts due on the applicable preferred securities. No single document
standing alone or operating in conjunction with fewer than all of the other
documents constitutes a guarantee. It is only the combined operation of these
documents that has the effect of providing a full, irrevocable and unconditional
guarantee of the obligations of the applicable trust under the applicable
preferred securities.
If and to the extent that we do not make payments on the debentures, the
applicable trust will not pay distributions or other amounts due on its
preferred securities. The applicable guarantee does not cover payment of
distributions when the applicable trust does not have sufficient funds to pay
the distributions. In this event, the remedy of a holder of preferred securities
is to institute a legal proceeding directly against us for enforcement of
payment of the distributions to the holder. Our obligations under the guarantees
are subordinated and junior in right of payment to all of our other
indebtedness.
Sufficiency of Payments
As long as payments of interest and other payments are made when due on the
debentures purchased by a trust, those payments will be sufficient to cover
distributions and other payments due on the trust preferred securities issued by
such trust, primarily because:
15
o the aggregate principal amount of the debentures will be equal to the
sum of the aggregate stated liquidation amount of the trust
securities;
o the interest rate and interest and other payment dates on the
debentures will match the distribution rate and distribution and other
payment dates for the preferred securities;
o we will pay for any and all costs, expenses and liabilities of the
trust, except the obligations of the trust to pay to holders of the
preferred securities the amounts due to the holders pursuant to the
terms of the preferred securities; and
o the trust will not engage in any activity that is not consistent with
the limited purposes of the trust.
Enforcement Rights of Holders of Preferred Securities
A holder of any preferred security may institute a legal proceeding
directly against us to enforce its rights under the applicable guarantee without
first instituting a legal proceeding against the applicable guarantee trustee,
the applicable trust or any other person. A default or event of default under
any of our senior or subordinated debt would not constitute a default or event
of default under the applicable trust agreement. In the event, however, of
payment defaults under, or acceleration of, our senior or subordinated debt, the
subordination provisions of the indenture provides that no payments may be made
in respect of the applicable debentures until the obligations have been paid in
full or any payment default has been cured or waived. Failure to make required
payments on the debentures would constitute an event of default under the
applicable trust agreement.
Limited Purpose of Trusts
The preferred securities evidence preferred undivided beneficial interests
in the assets of the corresponding trust. The trusts exist for the exclusive
purposes of issuing the trust securities, investing the proceeds thereof in
debentures and engaging only in those other activities necessary, advisable or
incidental thereto. A principal difference between the rights of a holder of a
preferred security and the rights of a holder of a debenture is that a holder of
a debenture is entitled to receive from us the principal amount of and interest
accrued on debentures held, while a holder of preferred securities is entitled
to receive distributions from the corresponding trust (or from us under the
corresponding guarantee) if and to the extent the trust has funds available for
the payment of such distributions.
Rights Upon Termination
Upon any voluntary or involuntary termination, winding-up or liquidation of
a trust involving the liquidation of the debentures, the holders of the
preferred securities will be entitled to receive, out of assets held by the
trust, the liquidation distribution in cash.
Upon or voluntary or involuntary liquidation or bankruptcy, the property
trustee, as holder of the debentures, would be a subordinated creditor of ours.
Therefore, the property trustee would be subordinated in right of payment to all
of our senior and subordinated debt, but is entitled to receive payment in full
of principal and interest before any of our shareholders receive payments or
distributions. Since we are the guarantor under the guarantee and have agreed to
pay for all costs, expenses and liabilities of the trusts other than the
obligations of the trusts to pay to holders of the preferred securities the
amounts due to the holders pursuant to the terms of the preferred securities,
the positions of a holder of the preferred securities and a holder of the
debentures relative to our other creditors and to our shareholders in the event
of liquidation or bankruptcy are expected to be substantially the same.
16
PLAN OF DISTRIBUTION
The trusts or we may sell the preferred securities:
o through underwriters or dealers,
o directly to one or a limited number of institutional purchasers; or
o through agents.
The applicable prospectus supplement will set forth the terms of the
offering of any preferred securities, including the name or names of any
underwriters, dealers or agents, the price of the preferred securities and the
net proceeds to us from such sale, any underwriting commissions or other items
constituting underwriters' compensation.
If underwriters are used in the sale, the preferred securities will be
acquired by the underwriters for their own account and may be resold from time
to time in one or more transactions, including negotiated transactions, at a
fixed public offering price or at varying prices determined at the time of sale.
The preferred securities may be offered to the public either through
underwriting syndicates represented by managing underwriters or directly by one
or more investment banking firms or others, as designated.
If we use a dealer in the sale of any preferred securities, we will sell
those preferred securities to the dealer, as principal. The dealer may then
resell the preferred securities to the public at varying prices to be determined
by the dealer at the time of resale.
We may sell preferred securities directly to one or more institutional
purchasers, or through agents at a fixed price or prices, which may be changed,
or at varying prices determined at time of sale. Unless otherwise indicated in
the prospectus supplement, any agent will be acting on a best effort basis for
the period of its appointment.
Unless otherwise set forth in the applicable prospectus supplement, the
obligations of the underwriters or agents to purchase the preferred securities
will be subject to conditions precedent and the underwriters will be obligated
to purchase all the preferred securities if any are purchased. Any initial
public offering price and any underwriting commissions or other items
constituting underwriters' compensation may be changed from time to time. If an
applicable prospectus supplement so indicates, we will authorize agents,
underwriters or dealers to solicit offers by specified institutions to purchase
trust preferred securities from us at the public offering price set forth in the
prospectus supplement under delayed delivery contracts providing for payment and
delivery on a specified date in the future. These contracts will be subject only
to those conditions set forth in the prospectus supplement, and the prospectus
supplement will set forth the commission payable for solicitation of the
contracts.
Under agreements entered into with us, agents and underwriters who
participate in the distribution of the trust preferred securities may be
entitled to indemnification by us against certain civil liabilities, including
liabilities under the Securities Act of 1933, or to contribution with respect to
payments which the agents or underwriters may be required to make. Agents and
underwriters may be customers of, engage in transactions with or perform
services for us in the ordinary course of business.
17
LEGAL OPINIONS
The validity of the debentures and the guarantees will be passed upon for
us by Bingham Summers Welsh & Spilman, LLP, Indianapolis, Indiana. The validity
of the trust securities will be passed upon for the trusts by Richards, Layton &
Finger, P.A., Wilmington, Delaware, special counsel to the trusts. If the
securities are being distributed in an underwritten offering, related legal
matters will be passed upon for the underwriters by counsel identified in the
related prospectus supplement.
EXPERTS
The consolidated financial statements of First Merchants Corporation as of
December 31, 2000 and 1999 and for each of the years in the three year period
ended December 31, 2000 incorporated in this prospectus and in the registration
statement by reference to our Annual Report on Form 10-K for the year ended
December 31, 2000 have been audited by BKD, LLP, independent auditors, as stated
in their report, which is incorporated by reference herein and in the
registration statement and have been so incorporated in reliance upon the report
of such firm, given upon their authority as experts in auditing and accounting.
Olive LLP and Baird, Kurtz & Dobson merged effective June 1, 2001, to become
BKD, LLP.
The consolidated financial statements of Lafayette Bancorporation as of
December 31, 2000 and 1999 and for each of the three years in the period ended
December 31, 2000, which are incorporated in this prospectus and in the
registration statement by reference to our Current Report on Form 8-K filed
December 21, 2001, have been audited by Crowe, Chizek and Company LLP,
independent auditors, as set forth in their report thereon incorporated by
reference herein and in the registration statement and have been so incorporated
in reliance upon the report of such firm, given upon their authority as experts
in auditing and accounting.
WHERE YOU CAN GET MORE INFORMATION
This prospectus is a part of a Registration Statement on Form S-3 filed by
us and the trusts with the Securities and Exchange Commission under the
Securities Act of 1933, with respect to the preferred securities, the debentures
and the guarantees. This prospectus does not contain all the information set
forth in the registration statement, certain parts of which are omitted in
accordance with the rules and regulations of the Securities and Exchange
Commission. For further information with respect to us and the securities
offered by this prospectus, reference is made to the registration statement.
Statements contained in this prospectus concerning the provisions of such
documents are necessarily summaries of such documents and each such statement is
qualified in its entirety by reference to the copy of the applicable documents
filed with the Securities and Exchange Commission.
We file periodic reports, proxy statements and other information with the
Securities and Exchange Commission. Our filings are available to the public over
the Internet at the Securities and Exchange Commission's website at
http://www.sec.gov. You may also inspect and copy these materials at the Public
Reference Room of the Securities and Exchange Commission at 450 Fifth Street,
N.W., Room 1024, Washington, D.C. 20549. Copies of such material can be obtained
at prescribed rates from the Public Reference Section of the Securities and
Exchange Commission at 450 Fifth Street, N.W., Washington, D.C. 20549. You may
obtain information on the operation of the Public Reference Room by calling the
Securities and Exchange Commission at 1-800-SEC-0330. You may also obtain
additional information about us on our website at http://www.firstmerchants.com.
The trusts are not currently subject to the information reporting
requirements of the Securities Exchange Act of 1934 and, although the trusts
will become subject to such requirements upon the
18
effectiveness of the registration statement, it is not expected that the trusts
will file separate reports under the Exchange Act.
DOCUMENTS INCORPORATED BY REFERENCE
We "incorporate by reference" into this prospectus the information in
documents we file with the Securities and Exchange Commission, which means that
we can disclose important information to you through those documents. The
information incorporated by reference is an important part of this prospectus.
Some information contained in this prospectus updates the information
incorporated by reference and some information we file subsequently with the
Securities and Exchange Commission will automatically update this prospectus. We
incorporate by reference:
o Our Annual Report on Form 10-K for the fiscal year ended December 31,
2000 (as amended by a Form 10-K/A filed October 29, 2001);
o Our Quarterly Report on Form 10-Q for the quarter ended March 31,
2001;
o Our Current Report on Form 8-K filed on April 19, 2001, announcing our
repurchase of 118,088 shares of our common stock;
o Our Quarterly Report on Form 10-Q for the quarter ended June 30, 2001;
o Our Current Report on Form 8-K filed on August 23, 2001, announcing a
5% stock dividend declared on shares of our outstanding common stock;
o Our Quarterly Report on Form 10-Q for the quarter ended September 30,
2001 (as amended by Form 10-Q/A filed December 19, 2001);
o Our Current Report on Form 8-K filed on October 15, 2001, announcing
the execution of an agreement dated October 14, 2001 between Lafayette
Bancorporation and First Merchants Corporation pursuant to which
Lafayette Bancorporation will be merged with and into First Merchants
Corporation; and
o Our Current Report on Form 8-K filed on December 21, 2001, containing
consolidated financial statements of Lafayette Bancorporation, pro
forma financial information of First Merchants Corporation and
announcing the execution of two agreements dated November 27, 2001
pursuant to which First Merchants Corporation will acquire two title
insurance agencies.
We also incorporate by reference any filings we make with the Securities
and Exchange Commission under Sections 13(a), 13(c), 14 and 15(d) of the
Securities Exchange Act of 1934 after the initial filing of the registration
statement that contains this prospectus and before the time that all of the
securities offered in this prospectus are sold.
You may request, either orally or in writing, a copy of the documents
incorporated by reference by contacting Larry R. Helms, our General Counsel, at
the following address and phone number: 200 East Jackson, Muncie, Indiana 47305,
telephone (765) 747-1500. Any documents so requested will be provided to you at
no cost.
You should rely only on the information incorporated by reference or
provided in this prospectus or the prospectus supplement. We have authorized no
one to provide you with different information. We
19
are not making an offer of these securities in any state where the offer is not
permitted. You should not assume that the information in this prospectus or the
prospectus supplement is accurate as of any date other than the date on the
front of the document.
20
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. Other Expenses of Issuance and Distribution.
The estimated expenses paid by First Merchants Corporation in connection
with the issuance and distribution of the securities being registered hereby,
other than underwriting discounts and commissions, are as follows:
Securities and Exchange Commission Registration Fee................... $ 18,750
Legal Fees and Expenses............................................... $100,000
Accountants' Fees and Expenses........................................ $ 30,000
Trustee's Fees and Expenses........................................... $ 15,000
Printing and Engraving Expenses....................................... $ 50,000
Miscellaneous......................................................... $ 25,000
--------
Total............................................................... $238,750
========
ITEM 15. Indemnification of Directors and Officers of First Merchants
Corporation.
First Merchants Corporation ("First Merchants") is an Indiana corporation.
Section 23-1-37-1 et seq. of the Indiana Business Corporation Law
contains detailed provisions on indemnification of directors and officers of an
Indiana corporation against expenses, judgments, settlements, penalties and
fines incurred with respect to certain proceedings.
First Merchants' Articles of Incorporation, as amended, and By-Laws, as
amended, provide that First Merchants will indemnify any person who is or was a
director, officer or employee of First Merchants or of any other corporation for
which he is or was serving in any capacity at the request of First Merchants
against all liability and expense that may be incurred in connection with,
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 First Merchants 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 or employee of First
Merchants 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 or employee will be indemnified only
if the Board of Directors of First Merchants (acting by a quorum consisting of
directors who are not parties to or who have been wholly successful with respect
to such action) or independent legal counsel finds that he has met the standards
of conduct set forth above.
The directors and officers of First Merchants are covered by an insurance
policy indemnifying them against certain civil liabilities, including
liabilities under the federal securities laws, which might be incurred by them
in such capacity.
The Trust Agreement of each First Merchants Capital Trust limits the
liability to each trust and certain persons, and provides for the
indemnification by First Merchants, of trustees, their officers, directors,
employees and certain other persons.
II-1
ITEM 16. List of Exhibits.
Exhibit Description
*1.1 Form of Underwriting Agreement
**3.1 Articles of Incorporation of First Merchants Corporation incorporated
by reference to Exhibit 3.1 to First Merchants Corporation's Form 10-Q
for the quarterly period ended June 30, 1999
**3.2 Bylaws of First Merchants Corporation incorporated by reference to
First Merchants Corporation's Form 10-Q for the quarterly period ended
September 30, 2001 (as amended by Form 10-Q/A filed December 19, 2001)
**4.1 Certificate of Trust of First Merchants Capital Trust I
**4.2 Trust Agreement of First Merchants Capital Trust I
**4.3 Certificate of Trust of First Merchants Capital Trust II
**4.4 Trust Agreement of First Merchants Capital Trust II
**4.5 Certificate of Trust of First Merchants Capital Trust III
**4.6 Trust Agreement of First Merchants Capital Trust III
**4.7 Form of Preferred Securities Guarantee Agreement to be issued by First
Merchants Corporation (Agreements for First Merchants Capital Trust I,
First Merchants Capital Trust II, and First Merchants Capital Trust
III are substantially identical except for names and dates)
**4.8 Form of Amended and Restated Trust Agreement to be used in connection
with the issuance of the Trust Preferred Securities
**4.9 Form of [____]% Cumulative Trust Preferred Security Certificate to be
issued by First Merchants Capital Trust I, II and III (included as
Exhibit D to Exhibit 4.8 to this Registration Statement)
**4.10 Form of Indenture
**4.11 Form of First Supplemental Indenture
**4.12 Form of [____]% Junior Subordinated Debenture to be issued by First
Merchants Corporation (included as Exhibit A to Exhibit 4.11 to this
Registration Statement)
**5.1 Opinion of Bingham Summers Welsh & Spilman, LLP with respect to
legality of the Junior Subordinated Debentures and the Preferred
Securities Guarantee Agreement
**5.2 Opinion of Richards, Layton & Finger, P.A. with respect to the
legality of the Trust Preferred Securities
*8.1 Opinion of Bingham Summers Welsh & Spilman LLP as to federal income
tax matters
**12.1 Computation of Ratio of Earnings to Combined Fixed Charges
23.1 Consent of Bingham Summers Welsh & Spilman LLP (included as part of
Exhibits 5.1 and 8.1)
23.2 Consent of Richards, Layton & Finger, P.A. (included as part of
Exhibit 5.2)
**23.3 Consent of Crowe, Chizek and Company LLP
**23.4 Consent of BKD, LLP
24.1 Power of Attorney of Directors and Officers of the Registrant
(included on Registration Statement Signature Page)
*25.1 Form T-1 Statement of Eligibility of Trustee for the Trust Preferred
Securities
*25.2 Form T-1 Statement of Eligibility of Trustee for the Junior
Subordinated Debentures
*25.3 Form-T-1 Statement of Eligibility of Trustee for the Preferred
Securities Guarantee Agreement
- ---------------
* To be filed as an exhibit to the registrant's Current Report on Form 8-K in
connection with a specific offering.
** Filed herewith.
II-2
ITEM 17. Undertakings.
The undersigned Registrants hereby undertake:
(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; notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Securities and
Commission pursuant to Rule 424(b) if, in the aggregate, the changes in
volume and price represent no more than a 20 percent change in the maximum
aggregate offering price set forth in the "Calculation of Registration Fee"
table in the effective Registration Statement; and
(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 clauses (i) and (ii) do not apply if the information
required to be included in a post-effective amendment by those clauses is
contained in periodic reports filed by First Merchants Corporation pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934 that are incorporated
by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the Securities
Act of 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.
(4) That, for purposes of determining any liability under the Securities
Act of 1933, each filing of First Merchants Corporation's annual report pursuant
to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 that is
incorporated by reference in the Registration Statement shall be deemed to be a
new registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(5) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
each of the Registrants pursuant to the provisions of Item 15 of this
Registration Statement, or otherwise, each Registrant has been advised that in
the opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Securities Act of 1933 and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by First Merchants Corporation of
II-3
expenses incurred or paid by a director, officer or controlling person of each
of the Registrants 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, each 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 Securities Act of 1933 and will
be governed by the final adjudication of such issue.
(6) For purposes of determining any liability under the Securities Act of
1933, the information omitted from the form of prospectus filed as part of this
Registration Statement in reliance upon Rule 430A and contained in a form of
prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or 497(h)
under the Securities Act shall be deemed to be part of this Registration
Statement as of the time it was declared effective.
(7) For the purpose of determining any liability under the Securities Act
of 1933, each post-effective amendment that contains a form of prospectus 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.
(8) To file an application for the purpose of determining the eligibility
of the trustee to act under subsection (a) of Section 310 of the Trust Indenture
Act of 1939 in accordance with the rules and regulations prescribed by the
Securities and Commission under Section 305(b)(2) of the Trust Indenture Act of
1939.
II-4
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, First Merchants
Corporation certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and 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 December 21, 2001.
FIRST MERCHANTS CORPORATION
By: /s/ Michael L. Cox
----------------------------------------
Michael L. Cox
President and Chief Executive Officer
S-1
POWER OF ATTORNEY
Each person whose signature appears below constitutes and appoints Michael
L. Cox and Larry R. Helms and each of them his true and lawful attorneys-in-fact
and agents with full power of substitution and resubstitution, for him and in
his name, place and stead, in any and all capacities, to sign any and all
amendments (including post-effective amendments) to this Registration Statement
and any subsequent registration statement filed by First Merchants Corporation
pursuant to Rule 462(b) of the Securities Act of 1933, and to file the same,
with all exhibits thereto, and other documents in connection therewith with the
Securities and Exchange Commission, granting unto said attorney-in-fact and
agents full power and authority to perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully and to
all intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or his substitute or
substitutes, may lawfully 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 as of the 21st day of December, 2001 by
the following persons in the capacities indicated.
Signature Title
/s/ Michael L. Cox President, Chief Executive
- --------------------------------------- Officer and Director (Principal
Michael L. Cox Executive Officer)
/s/ James L. Thrash Senior Vice President and Chief
- --------------------------------------- Financial Officer (Principal
James L. Thrash Financial and Accounting Officer)
/s/ Stefan S. Anderson Director
- ---------------------------------------
Stefan S. Anderson
/s/ Roger M. Arwood Director
- ---------------------------------------
Roger M. Arwood
/s/ James F. Ault Director
- ---------------------------------------
James F. Ault
/s/ Jerry M. Ault Director
- ---------------------------------------
Jerry M. Ault
/s/ Dennis A. Bierberich Director
- ---------------------------------------
Dennis A. Bieberich
/s/ Frank A. Bracken Director
- ---------------------------------------
Frank A. Bracken
/s/ Blaine A. Brownell Director
- ---------------------------------------
Blaine A. Brownell
S-2
/s/ Thomas B. Clark Director
- ---------------------------------------
Thomas B. Clark
/s/ Barry J. Hudson Director
- ---------------------------------------
Barry J. Hudson
/s/ Norman M. Johnson Director
- ---------------------------------------
Norman M. Johnson
/s/ George A. Sissel Director
- ---------------------------------------
George A. Sissel
/s/ Robert M. Smitson Director
- ---------------------------------------
Robert M. Smitson
/s/ John E. Worthen Director
- ---------------------------------------
John E. Worthen
S-3
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, First Merchants
Capital Trust I certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-3 and 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 December 21, 2001.
First Merchants Capital Trust I
By: First Merchants Corporation, as Sponsor
By: /s/ Michael L. Cox
----------------------------------------
Michael L. Cox
President and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, First Merchants
Capital Trust II certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-3 and 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 December 21, 2001.
First Merchants Capital Trust II
By: First Merchants Corporation, as Sponsor
By: /s/ Michael L. Cox
--------------------------------------
Michael L. Cox
President and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, First Merchants
Capital Trust III certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-3 and 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 December 21, 2001.
First Merchants Capital Trust III
By: First Merchants Corporation, as Sponsor
By: /s/ Michael L. Cox
----------------------------------------
Michael L. Cox
President and Chief Executive Officer
S-4
EXHIBIT INDEX
Exhibit Description
- ------- -----------
*1.1 Form of Underwriting Agreement
**3.1 Articles of Incorporation of First Merchants Corporation incorporated
by reference to Exhibit 3.1 to First Merchants Corporation's Form 10-Q
for the quarterly period ended June 30, 1999
**3.2 Bylaws of First Merchants Corporation incorporated by reference to
First Merchants Corporation's Form 10-Q for the quarterly period ended
September 30, 2001 (as amended by Form 10-Q/A filed December 19, 2001)
**4.1 Certificate of Trust of First Merchants Capital Trust I
**4.2 Trust Agreement of First Merchants Capital Trust I
**4.3 Certificate of Trust of First Merchants Capital Trust II
**4.4 Trust Agreement of First Merchants Capital Trust II
**4.5 Certificate of Trust of First Merchants Capital Trust III
**4.6 Trust Agreement of First Merchants Capital Trust III
**4.7 Form of Preferred Securities Guarantee Agreement to be issued by First
Merchants Corporation (Agreements for First Merchants Capital Trust I,
First Merchants Capital Trust II, and First Merchants Capital Trust
III are substantially identical except for names and dates)
**4.8 Form of Amended and Restated Trust Agreement to be used in connection
with the issuance of the Trust Preferred Securities
**4.9 Form of [____]% Cumulative Trust Preferred Security Certificate to be
issued by First Merchants Capital Trust I, II and III (included as
Exhibit D to Exhibit 4.8 to this Registration Statement)
**4.10 Form of Indenture
**4.11 Form of First Supplemental Indenture
**4.12 Form of [____]% Junior Subordinated Debenture to be issued by First
Merchants Corporation (included as Exhibit A to Exhibit 4.11 to this
Registration Statement)
**5.1 Opinion of Bingham Summers Welsh & Spilman, LLP with respect to
legality of the Junior Subordinated Debentures and the Preferred
Securities Guarantee Agreement
**5.2 Opinion of Richards, Layton & Finger, P.A. with respect to the
legality of the Trust Preferred Securities
*8.1 Opinion of Bingham Summers Welsh & Spilman LLP as to federal income
tax matters
**12.1 Computation of Ratio of Earnings to Combined Fixed Charges
23.1 Consent of Bingham Summers Welsh & Spilman LLP (included as part of
Exhibits 5.1 and 8.1)
23.2 Consent of Richards, Layton & Finger, P.A. (included as part of
Exhibit 5.2)
**23.3 Consent of Crowe, Chizek and Company LLP
**23.4 Consent of BKD, LLP
24.1 Power of Attorney of Directors and Officers of the Registrant
(included on Registration Statement Signature Page)
*25.1 Form T-1 Statement of Eligibility of Trustee for the Trust Preferred
Securities
*25.2 Form T-1 Statement of Eligibility of Trustee for the Junior
Subordinated Debentures
*25.3 Form-T-1 Statement of Eligibility of Trustee for the Preferred
Securities Guarantee Agreement
- ---------------
* To be filed as an exhibit to the registrant's Current Report on Form 8-K in
connection with a specific offering.
** Filed herewith.