Company: FRME
Filing Date: 2025-04-01
Form Type: DEF 14A
Source: 0000712534-25-000077
Chunk: 35

Company: FIRST MERCHANTS CORP
Filing Date: 2025-04-01
Form: DEF 14A
Chunk 35
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3) retirement and deferred compensation plan contributions under (a) the Retirement Pension Plan (“ Pension Plan ”) (for Mr. Hardwick only), (b) the Retirement and Income Savings Plan (“ §401(k) Plan ”), and (c) the 2011 Executive Deferred Compensation Plan (“ EDCP ”). In the event of an acquisition of FMC, the NEOs could also receive compensation under “double trigger” change of control agreements. The Company does not have employment or other severance agreements with its executive officers. Detailed information concerning each of the material elements of the NEOs’ compensation can be found on pages 30-35.

Base salary and non-equity incentive plan payments under the SMICP are intended to advance annual goals by providing a near-term financial reward for excellent performance that advances FMC’s strategic objectives. The targets for earning non-equity incentive plan payments under the SMICP are adjusted annually to align with the Company’s annual financial plan. The restricted stock awards under the LTEIP are designed to financially reward the achievement of long-term goals and to further align executives’ financial interests with those of other shareholders by tying the value of such compensation to sustained increases in the price of the Company’s stock. This objective is also supported by guidelines for executive officers to hold FMC stock equal in value to the following multiples of individual base salary: (i) Chief Executive Officer - six (6) times base salary; (ii) Other NEOs — three (3) times base salary; and (iii) other executive officers designated as Section 16 executive officers by the Board of Directors — two (2) times base salary. The three-year vesting provisions attached to the restricted stock awards, together with the vesting provisions in the retirement plans, also promote the long-term employment of qualified executives. All Company stock ownership guidelines are expected to be satisfied within five (5) years of October 31, 2024 and maintained for as long as the officer remains at their respective officer level.

THE RELATIONSHIP BETWEEN NEO COMPENSATION AND THE COMPANY’S PERFORMANCE

Disregarding retirement and deferred compensation plan contributions and only considering current compensation, payments earned under the incentive plans (the SMICP and the LTEIP) together constituted a substantial portion of the compensation paid to the NEOs for 2024. The size of the non-equity incentive payments under the SMICP and the value of the restricted stock awards under the LTEIP are directly impacted by the Company’s performance. Whether a non-equity incentive payment