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[First Merchants Corporation
Letterhead]
Form of
Senior Executive Officer Letter Agreement
[Name of Senior
Executive Officer]
[Title of Senior Executive Officer]
200 East Jackson St.
Muncie, IN 47305
Dear
______________________,
First
Merchants Corporation (the “Company”) anticipates
entering into a Securities Purchase Agreement (the
“Investment Agreement”), with the United States
Department of Treasury (the “Treasury”) that provides
for the Company’s participation in the Treasury’s TARP
Capital Purchase Program (the “CPP”). If the Company
does not participate in the CPP this letter shall only be of no
further force and effect. If the Company ceases at any time to
participate in the CPP, this letter shall only be in effect to the
extent required by the Treasury with respect to compensation earned
or paid during the period the Treasury holds preferred stock of the
Company (the “CPP Covered Period”).
For
the Company to participate in the CPP, and as a condition to the
closing of the investment contemplated by the Investment Agreement,
the Company is required to establish specified standards for
incentive compensation payable to its senior executive officers and
certain highly compensated employees and to make changes to its
compensation arrangements. To comply with these requirements, and
in consideration of the benefits that you will receive as a result
of the Company’s participation in the CPP, you agree as
follows:
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1.
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No Golden Parachute
Payments . So
long as you are an SEO or one of the next five most highly
compensated employees of the Company, you are prohibited from
receiving any Golden Parachute Payment from the Company during any
CPP Covered Period.
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2.
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Recovery of Bonus and Incentive
Compensation . Any bonus and incentive
compensation paid to you during a CPP Covered Period is subject to
recovery or “clawback” by the Company if the payments
were based on materially inaccurate financial statements or any
other materially inaccurate performance metric criteria.
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3.
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Compensation Program
Amendments .
Each of the Company’s compensation, bonus, incentive,
deferred compensation and other benefit plans, arrangements and
agreements (including golden parachute, severance, change in
control and employment agreements now in effect or adopted in the
future) (collectively, “Benefit Plans”) with respect to
you is hereby amended to the extent necessary to (a) give
effect to Provisions 1, 2, 3 and 4 above, and (b) comply with
Section 111 of EESA, as amended from time to time, and any
guidance issued thereunder. For reference, certain affected Benefit
Plans as of the Closing Date are set forth in
Appendix A to this letter.
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