|         |                                                                                                          |
|---------|----------------------------------------------------------------------------------------------------------|
| • | The accompanying notes to the unaudited pro forma combined consolidated condensed financial information; |

|         |                                                                                                                                                                                                                                                                                                      |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | First Merchants’ separate audited historical consolidated financial statements and accompanying notes as of and for the fiscal year ended December 31, 2012 and 2011, included in First Merchants’ Annual Report on Form 10-K for the fiscal year ended December 31, 2012 and 2011; |

|         |                                                                                                                                                                                                                                                                         |
|---------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | CFS’ separate audited historical consolidated financial statements and accompanying notes as of and for the year ended December 31, 2012 and 2011 included in CFS’ Annual Report on Form 10-K for the year ended December 31, 2012 and 2011; |

|         |                                                                                                                                                                                                                                                                                                                                            |
|---------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | First Merchants’ separate unaudited historical consolidated condensed financial statements and accompanying notes as of and for the three and six months ended June 30, 2013 and three and six months ended June 30, 2012 included in First Merchants’ Quarterly Report on Form 10-Q for the quarter ended June 30, 2013; |

|         |                                                                                                                                                                                                                                                                                                                        |
|---------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| • | CFS’ separate unaudited historical consolidated condensed financial statements and accompanying notes as of and for the three and six months ended June 30, 2013 and three and six months ended June 30, 2012 included in CFS’ Quarterly Report on Form 10-Q for the quarter ended June 30, 2013; and |

|         |                                             |
|---------|---------------------------------------------|
| • | The amended Form S-4 related to the Merger. |

----

|                                                                   |
|-------------------------------------------------------------------|
|                                                                   |  |  |  |  |  |  |  |  |  |  |  |  |  |
| UNAUDITED PRO FORMA COMBINED CONSOLIDATED CONDENSED BALANCE SHEET |
| AS OF JUNE 30, 2013                                               |
| (Dollars In Thousands)                                            |
|                                                              |   |   |   |   |   |
|                                                              |   |   |   |   |   |
|                                                              |  First |   |  Pro forma |   |  Pro forma |
|                                                              |  Merchants |  CFS |  Adjustments |   |  Combined |
|                                                              |   |   |   |   |   |
| Assets                                                            |   |   |   |   |   |
| Cash and due from banks                                           | $ | 69,404 |  | $ | 16,697 |  | $ | — |  |   | $ | 86,101 |  |
| Interest bearing deposits                                         |   | 132,929 |  | — |  |   | 132,929 |  |
| Fed funds sold                                                    |   |   | — |  |   | — |  |
| Cash and cash equivalents                                         | 69,404 |  | 149,626 |  | — |  |   | 219,030 |  |
|                                                              |   |   |   |   |   |
| Interest-bearing time deposits                                    | 59,898 |  |   | — |  |   | 59,898 |  |
| Investment securities                                             |   |   |   |   |   |
| Available for sale                                                | 584,593 |  | 219,931 |  | (17 | ) | (2) | 804,507 |  |
| Held to maturity                                                  | 324,399 |  | 12,984 |  | — |  |   | 337,383 |  |
| Total investment securities                                       | 908,992 |  | 232,915 |  | (17 | ) |   | 1,141,890 |  |
|                                                              |   |   |   |   |   |
| Mortgage loans held for sale                                      | 14,531 |  | 1,620 |  | — |  |   | 16,151 |  |
| Loans                                                             | 2,920,080 |  | 660,072 |  | (26,181 | ) | (2) | 3,543,674 |  |
|                                                              |   |   | (10,297 | ) | (2) |   |
| Allowance for loan losses                                         | (68,202 | ) | (12,660 | ) | 12,660 |  | (5) | (68,202 | ) |
| Net loans                                                         | 2,866,409 |  | 649,032 |  | (23,818 | ) |   | 3,491,623 |  |
|                                                              |   |   |   |   |   |
| Premises and equipment                                            | 54,165 |  | 15,293 |  | 4,609 |  | (4) | 74,067 |  |
| Federal Reserve and FHLB stock                                    | 32,790 |  | 6,188 |  | — |  |   | 38,978 |  |
| Interest receivable                                               | 15,186 |  | 2,470 |  | — |  |   | 17,656 |  |
| Core deposit intangible                                           | 7,384 |  |   | 7,312 |  | (6) | 14,696 |  |
| Goodwill                                                          | 141,375 |  |   | 44,938 |  | (3) | 186,313 |  |
| Cash surrender value of life insurance                            | 126,710 |  | 36,367 |  | — |  |   | 163,077 |  |
| Other real estate owned                                           | 11,765 |  | 21,878 |  | (7,847 | ) | (4) | 25,796 |  |
| Deferred tax asset                                                | 30,959 |  | 12,375 |  | 11,681 |  | (7) | 55,015 |  |
| Other assets                                                      | 13,227 |  | 5,404 |  | (753 | ) | (10) | 17,878 |  |
|                                                              |   |   |   |   |   |
| Total Assets                                                      | $ | 4,338,264 |  | $ | 1,131,548 |  | $ | 36,105 |  |   | $ | 5,505,917 |  |
|                                                              |   |   |   |   |   |
| Liabilities                                                       |   |   |   |   |   |
| Deposits                                                          |   |   |   |   |   |
| Noninterest-bearing                                               | $ | 741,095 |  | $ | 110,724 |  | $ | — |  |   | $ | 851,819 |  |
| Interest-bearing                                                  | 2,591,698 |  | 851,221 |  | 865 |  | (2) | 3,443,784 |  |
| Total deposits                                                    | 3,332,793 |  | 961,945 |  | 865 |  |   | 4,295,603 |  |
|                                                              |   |   |   |   |   |
| Borrowings                                                        | 423,385 |  | 49,306 |  | — |  |   | 472,691 |  |
| Interest payable                                                  | 1,150 |  |   | — |  |   | 1,150 |  |
| Other liabilities                                                 | 41,643 |  | 9,085 |  | 7,546 |  | (1) | 61,538 |  |
|                                                              |   |   | 3,264 |  | (10) |   |
| Total Liabilities                                                 | 3,798,971 |  | 1,020,336 |  | 11,675 |  |   | 4,830,982 |  |
|                                                              |   |   |   |   |   |
| Stockholder' Equity                                               |   |   |   |   |   |
| Preferred Stock                                                   | 68,087 |  |   | — |  |   | 68,087 |  |
| Cumulative Preferred Stock                                        | 125 |  |   | — |  |   | 125 |  |
| Common stock                                                      | 3,600 |  | 234 |  | 885 |  | (9) | 4,485 |  |
|                                                              |   |   | (234 | ) | (8) |   |
| Additional paid in capital                                        | 257,626 |  | 187,207 |  | 134,757 |  | (9) | 392,383 |  |
|                                                              |   |   | (187,207 | ) | (8) |   |
| Retained earnings                                                 | 225,034 |  | 78,033 |  | (78,033 | ) | (8) | 225,034 |  |
| Treasury stock                                                    |   | (154,443 | ) | 154,443 |  | (8) | — |  |
| Accumulated comprehensive income                                  | (15,179 | ) | 181 |  | (181 | ) | (8) | (15,179 | ) |
| Total Stockholders' Equity                                        | 539,293 |  | 111,212 |  | 24,430 |  |   | 674,935 |  |
| Total Liabilities and Stockholders' Equity                        | $ | 4,338,264 |  | $ | 1,131,548 |  | $ | 36,105 |  |   | $ | 5,505,917 |  |

----

|                                                                         |
|-------------------------------------------------------------------------|
|                                                                         |  |  |  |  |  |  |  |  |  |  |  |  |  |
| UNAUDITED PRO FORMA COMBINED CONSOLIDATED CONDENSED STATEMENT OF INCOME |
| For The Year Ended December 31, 2012                                    |
| (Dollars and Share Amounts In Thousands)                                |
|                                                                    |   |   |   |   |   |
|                                                                    |  First |   |  Pro forma |   |  Pro forma |
|                                                                    |  Merchants |  CFS |  Adjustments |   |  Combined |
|                                                                    |   |   |   |   |   |
| Interest Income                                                         |   |   |   |   |   |
| Loans receivable                                                        | $ | 147,225 |  | $ | 33,049 |  | $ | 1,872 |  | (11) | $ | 182,146 |  |
| Investment securities                                                   | 27,216 |  | 7,889 |  | — |  |   | 35,105 |  |
| Other                                                                   | 1,508 |  | 394 |  | — |  |   | 1,902 |  |
| Total Interest Income                                                   | 175,949 |  | 41,332 |  | 1,872 |  |   | 219,153 |  |
|                                                                    |   |   |   |   |   |
| Interest Expense                                                        |   |   |   |   |   |
| Deposits                                                                | 14,800 |  | 4,794 |  | (157 | ) | (11) | 19,437 |  |
| Fed funds purchased                                                     | 69 |  | — |  | — |  |   | 69 |  |
| Securities sold under repurchase agreements                             | 907 |  |   | — |  |   | 907 |  |
| Borrowings                                                              | 7,837 |  | 1,180 |  | — |  |   | 9,017 |  |
| Total Interest Expense                                                  | 23,613 |  | 5,974 |  | (157 | ) |   | 29,430 |  |
|                                                                    |   |   |   |   |   |
| Net Interest Income                                                     | 152,336 |  | 35,358 |  | 2,029 |  |   | 189,723 |  |
| Provision for loan losses                                               | 18,534 |  | 4,210 |  | — |  |   | 22,744 |  |
| Net Interest Income after Provision for Loan Losses                     | 133,802 |  | 31,148 |  | 2,029 |  |   | 166,979 |  |
|                                                                    |   |   |   |   |   |
| Other Income                                                            |   |   |   |   |   |
| Service charges on deposit accounts                                     | 11,587 |  | 6,355 |  | — |  |   | 17,942 |  |
| Fiduciary activities                                                    | 7,891 |  | — |  | — |  |   | 7,891 |  |
| Other customer fees                                                     | 11,233 |  |   | — |  |   | 11,233 |  |
| Commission income                                                       | 6,224 |  | — |  | — |  |   | 6,224 |  |
| Earnings on cash surrender value of life insurance                      | 3,418 |  | 1,080 |  | — |  |   | 4,498 |  |
| Net gains and fees on sales of loans                                    | 10,628 |  | 1,071 |  | — |  |   | 11,699 |  |
| Net realized gains/(losses) on sales of available for sale securities   | 2,389 |  | 1,509 |  | — |  |   | 3,898 |  |
| Gain on FDIC modified whole bank transaction                            | 9,124 |  |   | — |  |   | 9,124 |  |
| Other income                                                            | 1,808 |  | 1,994 |  | — |  |   | 3,802 |  |
| Total Other Income                                                      | 64,302 |  | 12,009 |  | — |  |   | 76,311 |  |
|                                                                    |   |   |   |   |   |
| Other Expenses                                                          |   |   |   |   |   |
| Salaries and benefits                                                   | 79,398 |  | 17,677 |  | — |  |   | 97,075 |  |
| Net occupancy                                                           | 10,186 |  | 2,756 |  | 230 |  | (13) | 13,172 |  |
| Equipment expenses                                                      | 7,201 |  | 1,778 |  | — |  |   | 8,979 |  |
| Marketing                                                               | 2,158 |  | 1,362 |  | — |  |   | 3,520 |  |
| Outside data processing fees                                            | 5,656 |  | 1,828 |  | — |  |   | 7,484 |  |
| Printing and office supplies                                            | 1,169 |  |   | — |  |   | 1,169 |  |
| Core deposit amortization                                               | 1,927 |  |   | 1,329 |  | (12) | 3,256 |  |
| FDIC expense                                                            | 3,509 |  | 1,927 |  | — |  |   | 5,436 |  |
| Other real estate and credit-related expenses                           | 8,178 |  | 2,510 |  | — |  |   | 10,688 |  |
| Other expense                                                           | 17,733 |  | 6,962 |  | — |  |   | 24,695 |  |
| Total Other Expenses                                                    | 137,115 |  | 36,800 |  | 1,560 |  |   | 175,475 |  |
| Income before Income Tax                                                | 60,989 |  | 6,357 |  | 470 |  |   | 67,816 |  |
| Income tax expense                                                      | 15,867 |  | 1,692 |  | 164 |  | (14) | 17,723 |  |
| Net Income                                                              | 45,122 |  | 4,665 |  | 305 |  |   | 50,092 |  |
| Preferred Stock dividends and discount accretion                        | (4,539 | ) |   | — |  |   | (4,539 | ) |
| Net Income Available to Common Stockholders                             | $ | 40,583 |  | $ | 4,665 |  | $ | 305 |  |   | $ | 45,553 |  |
|                                                                    |   |   |   |   |   |
| Per Share Data                                                          |   |   |   |   |   |
| Basic earnings per common share                                         | $ | 1.42 |  | $ | 0.43 |  |   |   | $ | 1.28 |  |
| Diluted earnings per common share                                       | $ | 1.41 |  | $ | 0.43 |  |   |   | $ | 1.27 |  |
| Average common shares-basic                                             | 28,633 |  | 10,738 |  | 7,079 |  |   | 35,712 |  |
| Average common shares-diluted                                           | 28,847 |  | 10,795 |  | 7,088 |  |   | 35,935 |  |

----

|                                                                         |
|-------------------------------------------------------------------------|
|                                                                         |  |  |  |  |  |  |  |  |  |  |  |  |  |
| UNAUDITED PRO FORMA COMBINED CONSOLIDATED CONDENSED STATEMENT OF INCOME |
| For The Six Months Ended June 30, 2013                                  |
| (Dollars and Share Amounts In Thousands)                                |
|                                                                    |   |   |   |   |   |
|                                                                    |  First |   |  Pro forma |   |  Pro forma |
|                                                                    |  Merchants |  CFS |  Adjustments |   |  Combined |
|                                                                    |   |   |   |   |   |
| Interest Income                                                         |   |   |   |   |   |
| Loans receivable                                                        | $ | 71,407 |  | $ | 15,195 |  | $ | 936 |  | (11) | $ | 87,538 |  |
| Investment securities                                                   | 12,164 |  | 3,324 |  | — |  |   | 15,488 |  |
| Other                                                                   | 820 |  | 245 |  | — |  |   | 1,065 |  |
| Total Interest Income                                                   | 84,391 |  | 18,764 |  | 936 |  |   | 104,091 |  |
|                                                                    |   |   |   |   |   |
| Interest Expense                                                        |   |   |   |   |   |
| Deposits                                                                | 5,490 |  | 1,759 |  | (79 | ) | (11) | 7,170 |  |
| Fed funds purchased                                                     | 12 |  |   | — |  |   | 12 |  |
| Securities sold under repurchase agreements                             | 402 |  |   | — |  |   | 402 |  |
| Borrowings                                                              | 2,379 |  | 571 |  | — |  |   | 2,950 |  |
| Total Interest Expense                                                  | 8,283 |  | 2,330 |  | (79 | ) |   | 10,534 |  |
|                                                                    |   |   |   |   |   |
| Net Interest Income                                                     | 76,108 |  | 16,434 |  | 1,015 |  |   | 93,557 |  |
| Provision for loan losses                                               | 4,099 |  | 1,586 |  | — |  |   | 5,685 |  |
| Net Interest Income after Provision for Loan Losses                     | 72,009 |  | 14,848 |  | 1,015 |  |   | 87,872 |  |
|                                                                    |   |   |   |   |   |
| Other Income                                                            |   |   |   |   |   |
| Service charges on deposit accounts                                     | 5,641 |  | 3,168 |  | — |  |   | 8,809 |  |
| Fiduciary activities                                                    | 4,371 |  |   | — |  |   | 4,371 |  |
| Other customer fees                                                     | 5,596 |  |   | — |  |   | 5,596 |  |
| Commission income                                                       | 3,920 |  |   | — |  |   | 3,920 |  |
| Earnings on cash surrender value of life insurance                      | 1,310 |  | 464 |  | — |  |   | 1,774 |  |
| Net gains and fees on sales of loans                                    | 4,835 |  | 569 |  | — |  |   | 5,404 |  |
| Net realized gains/(losses) on sales of available for sale securities   | 487 |  | 376 |  | — |  |   | 863 |  |
| Other income                                                            | 1,776 |  | 83 |  | — |  |   | 1,859 |  |
| Total Other Income                                                      | 27,936 |  | 4,660 |  | — |  |   | 32,596 |  |
|                                                                    |   |   |   |   |   |
| Other expenses                                                          |   |   |   |   |   |
| Salaries and benefits                                                   | 41,327 |  | 8,788 |  | — |  |   | 50,115 |  |
| Net occupancy                                                           | 4,869 |  | 1,319 |  | 115 |  | (13) | 6,303 |  |
| Equipment expenses                                                      | 3,516 |  | 801 |  | — |  |   | 4,317 |  |
| Marketing                                                               | 1,002 |  | 584 |  | — |  |   | 1,586 |  |
| Outside data processing fees                                            | 2,871 |  | 1,057 |  | — |  |   | 3,928 |  |
| Printing and office supplies                                            | 642 |  |   | — |  |   | 642 |  |
| Core deposit amortization                                               | 770 |  |   | 665 |  | (12) | 1,435 |  |
| FDIC expense                                                            | 1,418 |  | 960 |  | — |  |   | 2,378 |  |
| Other real estate and credit related expenses                           | 3,345 |  | 364 |  | — |  |   | 3,709 |  |
| Other expense                                                           | 8,682 |  | 4,046 |  | — |  |   | 12,728 |  |
| Total Other Expenses                                                    | 68,442 |  | 17,919 |  | 780 |  |   | 87,141 |  |
| Income before Income Tax                                                | 31,503 |  | 1,589 |  | 235 |  |   | 33,327 |  |
| Income tax expense                                                      | 8,823 |  | 254 |  | 82 |  | (14) | 9,159 |  |
| Net Income                                                              | 22,680 |  | 1,335 |  | 153 |  |   | 24,168 |  |
| Preferred stock dividends and discount accretion                        | (1,709 | ) |   | — |  |   | (1,709 | ) |
| Net Income Available to Common Stockholders                             | $ | 20,971 |  | $ | 1,335 |  | $ | 153 |  |   | $ | 22,459 |  |
|                                                                    |   |   |   |   |   |
| Per Share Data                                                          |   |   |   |   |   |
| Basic earnings per common share                                         | $ | 0.73 |  | $ | 0.12 |  |   |   | $ | 0.63 |  |
| Diluted earnings per common share                                       | $ | 0.72 |  | $ | 0.12 |  |   |   | $ | 0.62 |  |
| Average common shares-basic                                             | 28,750 |  | 10,765 |  | 7,079 |  |   | 35,829 |  |
| Average common shares-diluted                                           | 28,997 |  | 10,840 |  | 7,088 |  |   | 36,085 |  |

----

|                                                                                                                |
|----------------------------------------------------------------------------------------------------------------|
|                                                                                                                |
| Note 1 - Basis of Presentation                                                                                 |
|                                                                                                           |
| First Merchants has agreed to acquire CFS for a fixed exchange ratio of .65 share of First Merchants stock for |
| each CFS share.  The acquisition will be accounted for under the acquisition method of accounting and,         |
| accordingly, the assets and liabilities of CFS have been marked to estimated fair value upon conditions as of  |
| June 30, 2013.  Since these are pro forma statements, we cannot assure that the amounts reflected in these     |
| financial statements would have been representative of the actual amounts earned had the companies been        |
| combined at the time.                                                                                          |

|                                          |
|------------------------------------------|
|                                          |  |  |  |  |
| Note 2 - Pro forma Adjustments Footnotes |   |
|                                     |   |   |
| (1)                                      | To record accrual by CFS for estimated transaction costs of $ 7,546,000, net of tax, which includes $3,895,000 |
|                                     | (net of tax) related to eliminating the CFS pension plan, $1,055,000 (net of tax) in change of control |
|                                     | agreements and $2,596,000 (net of tax) in acquisition costs. |
|                                     |   |   |
| (2)                                      | To adjust interest-earning assets and interest-bearing liabilities of CFS to approximate fair value. |
|                                     | Adjustment to loans of $36,478,000, investment securities of $17,000 and deposits of $865,000. |
|                                     |   |   |
| (3)                                      | To record goodwill generated from the acquisition |   |
|                                     | Purchase Price: |   |
|                                     | CFS outstanding shares | 10,891,472 |  |
|                                     | Conversion ratio | 65 | % |
|                                     | Shares of First Merchants stock issued | 7,079,457 |  |
|                                     | First Merchants stock price | $ | 19.16 |  |
|                                     | Total Purchase Price | $ | 135,642,392 |  |
|                                     |   |   |
|                                     |   |   |
|                                     |   |  (Dollars in thousands) |
|                                     | Total Purchase Price | $ | 135,642 |  |
|                                     |   |   |
|                                     | Allocated to: |   |
|                                     | Historical book value of CFS assets and liabilities | $ | 111,212 |  |
|                                     | CFS estimated transaction costs, net of tax | (5,047 | ) |
|                                     | Record Pension liability, net of tax | (2,499 | ) |
|                                     | Allowance for Loan Loss write-off | 12,660 |  |
|                                     | Adjusted book value of CFS | $ | 116,326 |  |
|                                     |   |   |
|                                     |   |   |
|                                     | Adjustments to record assets and liabilities at fair value: |   |
|                                     | Loans, credit mark | $ | (26,181 | ) |
|                                     | Loans, interest rate mark | (10,297 | ) |
|                                     | Securities | (17 | ) |
|                                     | Premises and equipment | 4,609 |  |
|                                     | Investment in low income housing tax credits | (753 | ) |
|                                     | Core deposits intangible | 7,312 |  |
|                                     | Other real estate owned | (7,847 | ) |
|                                     | Deferred taxes | 11,681 |  |
|                                     | Deposits | (865 | ) |
|                                     | Letters of Credit | (3,264 | ) |
|                                     | Total allocation | $ | (25,622 | ) |
|                                     | Goodwill | $ | 44,938 |  |

----

|                                                     |
|-----------------------------------------------------|
|                                                     |  |  |  |  |
| Note 2 - Pro forma Adjustments Footnotes continued: |   |
|                                                |   |   |
| (4)                                                 | To record fair value adjustment to premises and equipment of $4,609,000 and other real estate owned of $7,847,000. |
|                                                |   |   |
| (5)                                                 | To eliminate CFS allowance for loan loss of $12,660,000. |
|                                                |   |   |
| (6)                                                 | To record core deposit intangible of $7,312,000. |
|                                                |   |   |
| (7)                                                 | To record deferred taxes on the purchase accounting adjustments and valuation adjustments of $11,681,000 using |
|                                                | an estimated tax rate of 35%. |
|                                                |   |   |
| (8)                                                 | To eliminate CFS equity accounts of $111,212,000. |
|                                                |   |   |
| (9)                                                 | To record issuance of 7,079,457 shares of First Merchants stock. |
|                                                |   |  (Dollars in thousands) |
|                                                | Common Stock (7,079,457 shares at stated value of $0.125 per share) | $ | 885 |  |
|                                                | Additional Paid in Capital (7,079,457 shares at $17.025 per share) | 134,757 |  |
|                                                | Total stock issued (7,079,457 shares at $19.16 per share) | $ | 135,642 |  |
|                                                |   |   |
| (10)                                                | To record fair value adjustment to the investment in low-income housing projects of $753,000 and letters of credit of $3,264,000 |
|                                                |   |   |
| (11)                                                | To record effect of amortization of purchase accounting adjustments of $10,297,000 in loans (interest rate mark only) and $865,000 |
|                                                | in deposits in a manner that approximates the level yield method. |
|                                                |   |   |
| (12)                                                | To record amortization of core deposit premium utilizing an accelerated method over 10 years. |
|                                                |   |   |
| (13)                                                | To record annual amortization of purchase accounting related to premises and equipment over the estimated life of related assets. |
|                                                |   |   |
| (14)                                                | To record tax effect of purchase accounting adjustments at an effective rate of 35%. |