Michael Rechin
FIRST MERCHANTSAbout Michael C. Rechin
Michael C. Rechin (age 66) is a longtime First Merchants director (since 2005) and currently serves as Vice Chair of the Company; he is the former President & CEO of First Merchants Corporation and First Merchants Bank (led 2007–2020) and previously spent 23 years in senior roles at National City Bank, including managing Indiana commercial banking (1995–2005). He resides in the Indianapolis metropolitan area, a key FRME growth market, and is not an independent director under Nasdaq rules due to his prior executive relationship with the Company .
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| First Merchants Corporation | Vice Chair (Board officer) | Current | Board leadership; governance influence |
| First Merchants Corporation & Bank | President & CEO | 2007–2020 | Led strategy and operations; long-tenured leadership |
| First Merchants Corporation | EVP & COO | 2005–2007 | Senior operating leadership prior to CEO role |
| National City Bank | Senior management; Manager, Indiana Commercial Banking | ~1982–2005; Manager 1995–2005 | Commercial banking leadership; industry expertise |
External Roles
| Organization | Role | Tenure/Notes |
|---|---|---|
| Sheehan Family Foundation | Board of Advisors | Current |
| Hageman Group | Board of Directors | Current (private company) |
| Conner Prairie Museum | Director | Prior service |
| The Center for the Performing Arts | Director | Prior service |
Board Governance
| Item | Details |
|---|---|
| Independence status | Not independent (former CEO) under Nasdaq Listing Rule 5605(a)(2) |
| Board attendance | Board held 6 meetings in 2024; no director attended fewer than 75% of aggregate Board+Committee meetings; all directors attended the 2024 Annual Meeting |
| Executive sessions | Board meets in executive session at each regular meeting and at its annual retreat |
| Board leadership | Independent Chair (Jean L. Wojtowicz); CEO separate (Mark Hardwick); Vice Chair role held by Rechin |
| Committee memberships | Risk & Credit Policy Committee member (8 meetings in 2024) |
| Other committees | Not listed as member of Audit, Compensation & HR, or Nominating & Governance Committees |
| ESG oversight | Nominating & Governance Committee oversees ESG; Board briefed quarterly |
Fixed Compensation
| Component (2024) | Amount |
|---|---|
| Fees Earned or Paid in Cash | $57,217 |
| Stock Awards (grant date fair value) | $95,282 |
| All Other Compensation (dividends on director stock awards) | $9,656 |
| Total | $162,156 |
- Director pay structure: Annual retainer $140,000 for non-employee directors; additional $10,000 for Vice Chair; $5,000 for Risk & Credit Policy Committee membership; chairs/members of certain committees receive additional fees; no separate meeting fees; pay delivered quarterly .
- Equity mix policy: At least 62.5% of non-employee director compensation is paid in restricted stock; 37.5% in cash; restricted shares vest at the earlier of 3rd anniversary, director retirement, death/total disability, or change of control (subject to plan terms) .
Performance Compensation
| Metric | Structure | Notes |
|---|---|---|
| Performance metrics for director compensation | None disclosed | Director equity under ECPND is time-based restricted stock, not performance-based |
| Equity vesting | Time-based; earliest of 3 years, retirement, death/disability, change of control | Directors retain voting/dividend rights on restricted shares until vesting/forfeiture |
| Cash vs equity mix | Cash 37.5% / Equity 62.5% | In effect since Jan 1, 2015 to strengthen alignment |
Other Directorships & Interlocks
| Company | Type | Role | Potential Interlock/Conflict |
|---|---|---|---|
| Hageman Group | Private | Director | No FRME-related transaction disclosures; no Item 404 related party transactions linked to Rechin |
| Sheehan Family Foundation | Non-profit | Board of Advisors | No FRME-related transaction disclosures |
| Conner Prairie Museum | Non-profit | Prior Director | Historical; no current conflict noted |
| The Center for the Performing Arts | Non-profit | Prior Director | Historical; no current conflict noted |
Expertise & Qualifications
- 35+ years in banking and financial services; former FRME CEO with strategic, operational and risk management experience across commercial banking .
- Deep regional market familiarity; Indianapolis metro presence aligns with FRME growth markets .
- Board leadership experience as Vice Chair; continuity of institutional knowledge beneficial for oversight .
Equity Ownership
| Ownership Detail | Amount |
|---|---|
| Total beneficial ownership (shares) | 91,847 (includes 7,464 restricted shares) |
| Ownership as % of shares outstanding | <1% |
| Unvested restricted shares (ECPND, at 12/31/2024) | 7,464 |
| Options outstanding | 0 (non-employee director option program eliminated after 2015; none outstanding for Rechin) |
| Hedging/pledging | Prohibited by Company policy for directors; no pledging disclosed |
| Director ownership guideline | ≥3x total annual director compensation; expected within 6 years; all current directors have met or are on course |
Insider Trades
| Period | Form 4 activity disclosed in proxy | Section 16(a) compliance |
|---|---|---|
| 2024 | Not specifically disclosed for Rechin | No delinquent Section 16(a) filings noted for Rechin; proxy lists one late filing for a different director (Halderman) |
Governance Assessment
- Independence and potential conflicts: Rechin is not independent due to his former CEO role; this can raise concerns about board objectivity, particularly given his leadership position as Vice Chair and membership on the Risk & Credit Policy Committee overseeing enterprise risk .
- Engagement and attendance: Board met 6 times in 2024, with no director below 75% attendance and full director attendance at the 2024 Annual Meeting, supporting engagement expectations .
- Pay and alignment: Director compensation emphasizes equity (62.5% in restricted stock) with ownership guidelines (≥3x annual pay), hedging/pledging prohibitions, and quarterly grants—factors that enhance shareholder alignment despite the lack of explicit performance conditions for director equity .
- Shareholder signals: Say-on-pay support for NEOs was strong at 92.65% in 2024, indicating broader investor confidence in FRME’s compensation governance; while not director-specific, it reflects the Compensation Committee’s credibility .
RED FLAGS
- Not independent: Former CEO status formally disqualifies independence, which may affect perceptions of board oversight quality, especially in risk oversight .
- Dual influence: Vice Chair role plus Risk & Credit Policy Committee membership concentrates governance influence in a non-independent director, which can be viewed as a potential board capture risk without adequate counterweights .
- No performance-based director equity: Director equity is time-based rather than tied to measurable performance metrics; alignment relies on ownership policies and equity mix rather than contingent performance outcomes .
Mitigating factors
- Independent Board Chair, separated CEO/Chair roles, executive sessions each regular meeting, and stringent ownership/hedging/pledging policies help counterbalance independence concerns .
- No Item 404 related-party transactions disclosed for Rechin; general related-person transactions are subject to review and were on market terms .