SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q [X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended June 30, 2006 OR [ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from ________ to ________ Commision File Number 0-14492 FARMERS & MERCHANTS BANCORP, INC. (Exact name of registrant as specified in its charter) <TABLE> <S> <C> OHIO 34-1469491 (State or other jurisdiction of (I.R.S Employer incorporation or organization) Identification No.) </TABLE> <TABLE> <S> <C> 307-11 North Defiance Street, Archbold, Ohio 43502 (Address of principal executive offices) (Zip Code) </TABLE> (419) 446-2501 Registrant's telephone number, including area code _________________________________________________________________________ (Former name, former address and former fiscal year, if changed since last report.) Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ] Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Large accelerated filer [ ] Accelerated filer [X] Non-accelerated filer [ ] Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [X] Indicate the number of shares of each of the issuers classes of common stock, as of the latest practicable date: <TABLE> <S> <C> Common Stock, No Par Value 5,189,000 Class Outstanding as of July 28, 2006 </TABLE>
FARMERS & MERCHANTS BANCORP, INC. INDEX <TABLE> <CAPTION> Form 10-Q Items Page - ----------- ----- <S> <C> <C> PART I. FINANCIAL INFORMATION Item 1. Financial Statements (Unaudited) Condensed Consolidated Balance Sheets- June 30, 2006, December 31, 2005, June 30, 2005 1 Condensed Consolidated Statements of Net Income- Three Months and Six Months Ended June 30, 2006 and June 30, 2005 2 Condensed Consolidated Statements of Cash Flows- Six Months Ended June 30, 2006 and June 30, 2005 3 Notes to Condensed Financial Statements 4 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 4-6 Item 3. Market Risk 7 Item 4. Controls and Procedures 8 PART II. OTHER INFORMATION Item 1. Legal Proceedings 8 Item 1A. Risk Factors 8 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 8 Item 3. Defaults Upon Senior Securities 8 Item 4. Submission of Matters to a Vote of Security Holders 8-9 Item 5. Other Information 9 Item 6. Exhibits 9 Signatures 10 Exhibit 3.1 Amended Articles of Incorporation of Farmers & Merchants Bancorp, Inc. 11-13 Certifications Under Section 302 14-15 Exhibit 32. Additional Exhibit - Certifications Under Section 906 16 </TABLE>
ITEM 1 FINANCIAL STATEMENTS CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (in thousands of dollars) <TABLE> <CAPTION> June 30, 2006 Dec 31, 2005 ------------- ------------ <S> <C> <C> ASSETS: Cash and due from banks $ 15,221 $ 20,056 Interest bearing deposits with banks 311 2,533 Federal funds sold 822 0 Investment Securities: U.S. Treasury 2,366 2,355 U.S. Government 110,113 138,358 State & political obligations 54,717 62,891 All others 3,947 3,838 Loans and leases (Net of reserve for loan losses of $5,268 & $5,388 respectively) 485,209 458,704 Bank premises and equipment-net 14,507 14,874 Accrued interest and other assets 16,771 17,336 -------- -------- TOTAL ASSETS $703,984 $720,945 ======== ======== LIABILITIES AND SHAREHOLDERS' EQUITY LIABILITIES: Deposits: Noninterest bearing $ 49,867 $ 64,791 Interest bearing 493,497 511,506 Federal funds purchased and securities sold under agreement to repurchase 40,774 21,158 Other borrowed money 29,562 34,952 Accrued interest and other liabilities 6,077 5,950 -------- -------- Total Liabilities 619,777 638,357 SHAREHOLDERS' EQUITY: Common stock, no par value - authorized 6,500,000 shares; issued 5,189,000 shares 12,677 12,677 Treasury Stock - 7,080 shares, Unearned stock awards 3,920 shares and for Dec. 31, 2005 - 80 shares, Unearned stock 3,920 shares (279) (115) Undivided profits 74,491 71,933 Accumulated other comprehensive income (expense) (2,682) (1,907) -------- -------- Total Shareholders' Equity 84,207 82,588 LIABILITIES AND SHAREHOLDERS' EQUITY $703,984 $720,945 ======== ======== </TABLE> See Notes to Condensed Consolidated Unaudited Financial Statements. Note: The December 31, 2005 Balance Sheet has been derived from the audited financial statements of that date. 1
FARMERS & MERCHANTS BANCORP, INC. CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) (in thousands of dollars, except per share data) <TABLE> <CAPTION> Three Months Ended Six Months Ended ----------------------------- ----------------------------- June 30, 2006 June 30, 2005 June 30, 2006 June 30, 2005 ------------- ------------- ------------- ------------- <S> <C> <C> <C> <C> INTEREST INCOME: Loans and leases $ 8,654 $ 7,615 $ 16,742 $ 15,339 Investment Securities: U.S. Treasury securities 18 32 36 67 Securities of U.S. Government agencies 1,109 965 2,359 1,897 Obligations of states and political subdivisions 538 508 1,118 1,012 Other 51 44 109 85 Federal funds 31 -- 101 1 Deposits in banks 3 42 6 91 ---------- ---------- ---------- ---------- Total Interest Income 10,404 9,206 20,471 18,492 INTEREST EXPENSE: Deposits 3,733 2,796 7,301 5,478 Borrowed funds 652 363 1,243 699 Total Interest Expense 4,385 3,159 8,544 6,177 NET INTEREST INCOME BEFORE PROVISION FOR LOAN LOSSES 6,019 6,047 11,927 12,315 PROVISION FOR LOAN LOSSES 15 (205) (35) (109) NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES 6,004 6,252 11,962 12,424 OTHER INCOME: Service charges 952 978 1,746 1,665 Other 698 689 1,308 1,281 Net securities gains (losses) (29) -- (9) -- ---------- ---------- ---------- ---------- 1,621 1,667 3,045 2,946 OTHER EXPENSES: Salaries and wages 2,100 2,147 4,100 4,194 Pension and other employee benefits 604 564 1,233 1,100 Occupancy expense (net) 159 166 294 329 Other operating expenses 2,074 2,033 3,926 3,992 ---------- ---------- ---------- ---------- 4,937 4,910 9,553 9,615 ---------- ---------- ---------- ---------- INCOME BEFORE FEDERAL INCOME TAX 2,688 3,009 5,454 5,755 FEDERAL INCOME TAXES 721 803 1,468 1,515 ---------- ---------- ---------- ---------- NET INCOME 1,967 2,206 3,986 4,240 ========== ========== ========== ========== OTHER COMPREHENSIVE INCOME (NET OF TAX): Unrealized gains (losses) on securities (624) 835 (774) (640) COMPREHENSIVE INCOME (EXPENSE) $ 1,343 $ 3,041 $ 3,212 $ 3,600 NET INCOME PER SHARE $ 0.38 $ 0.42 $ 0.77 $ 0.82 Based upon average weighted shares outstanding of: 5,192,689 5,200,000 5,194,304 5,200,000 DIVIDENDS DECLARED $ 0.15 $ 0.11 $ 0.28 $ 0.23 </TABLE> No disclosure of diluted earnings per share is required as shares are antidiluted as of quarter end. See Notes to Condensed Consolidated Unaudited Financial Statements. 2
FARMERS & MERCHANTS BANCORP, INC. CONDENSED CONSOLIDATED STATMENTS OF CASH FLOWS (Unaudited) (in thousands of dollars) <TABLE> <CAPTION> Six Months Ended ----------------------------- June 30, 2006 June 30, 2005 ------------- ------------- <S> <C> <C> CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 3,986 $ 4,240 Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities: Depreciation and amortization 554 604 Premium amortization 404 616 Discount amortization (148) (54) Provision for loan losses (35) (109) Provision (Benefit) for deferred income taxes -- 330 Gain (Loss) on sale of fixed assets (31) 33 (Gain) Loss on sale of investment securities 9 -- Changes in Operating Assets and Liabilities: Accrued interest receivable and other assets 964 (634) Accrued interest payable and other liabilities 163 736 -------- -------- Net Cash Provided by Operating Activities 5,866 5,762 CASH FLOWS FROM INVESTING ACTIVITIES Capital expenditures (156) (380) Net (increase) decrease in Federal Funds Sold (822) -- Proceeds from sale of fixed assets -- -- Proceeds from maturities of investment securities: 35,431 15,114 Proceeds from sale of investment securities: 4,777 -- Purchase of investment securities (5,318) (20,053) Net (increase) decrease in loans and leases (26,470) 8,460 -------- -------- Net Cash Provided (Used) by Investing Activities 7,442 3,141 CASH FLOWS FROM FINANCING ACTIVITIES Net increase (decrease) in deposits (32,933) (12,127) Net change in short-term borrowings 19,616 1,050 Increase in long-term borrowings -- -- Payments on long-term borrowings (5,390) (425) Purchase of Treasury stock (164) -- Payments of dividends (1,494) (1,300) -------- -------- Net Cash Provided (Used) by Financing Activities (20,365) (12,802) -------- -------- Net change in cash and cash equivalents (7,057) (3,899) Cash and cash equivalents - Beginning of year 22,589 24,256 -------- -------- CASH AND CASH EQUIVALENTS - END OF THE YEAR $ 15,532 $ 20,357 ======== ======== RECONCILIATION OF CASH AND CASH EQUIVALENTS: Cash and cash due from banks $ 15,221 $ 15,409 Interest bearing deposits 311 4,948 -------- -------- $ 15,532 $ 20,357 ======== ======== </TABLE> See Notes to Condensed Consolidated Unaudited Financial Statements. 3
FARMERS & MERCHANTS BANCORP, INC. Notes to Condensed Consolidated Unaudited Financial Statements NOTE 1 BASIS OF PRESENTATION The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information and with the instructions for Form 10Q and Rule 10-01 of Regulation S-X; accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments, consisting of normal recurring accruals, considered necessary for a fair presentation have been included. Operating results for the six months ended June 30, 2006 are not necessarily indicative of the results that are expected for the year ended December 31, 2006. For further information, refer to the consolidated financial statements and footnotes thereto included in the Company's annual report on Form 10-K for the year ended December 31, 2005. The Company's Board of Directors declared a 4 for 1 stock split effective May 12, 2006. Therefore, all references in the financial statements and other disclosures related to the number of shares and per share amounts of the Company's stock have been retroactively restated to reflect the increased number of shares outstanding. ITEM 2 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS Statements contained in this portion of the Company's report may be forward-looking statements, as that term is defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as "intend," "believe," "expect," "anticipate," "should," "planned," "estimated," and "potential." Such forward-looking statements are based on current expectations, but may differ materially from those currently anticipated due to a number of factors, which include, but are not limited to, factors discussed in documents filed by the Company with the Securities and Exchange Commission from time to time. Other factors which could have a material adverse effect on the operations of the company and its subsidiaries which include, but are not limited to, changes in interest rates, general economic conditions, legislative and regulatory changes, monetary and fiscal policies of the U.S. Government, including policies of the U.S. Treasury and the Federal Reserve Board, the quality and composition of the loan or investment portfolios, demand for loan products, deposit flows, competition, demand for financial services in the Bank's market area, changes in relevant accounting principles and guidelines and other factors over which management has no control. The forward-looking statements are made as of the date of this report, and the Company assumes no obligation to update the forward-looking statements or to update the reasons why actual results differ from those projected in the forward-looking statements. CRITICAL ACCOUNTING POLICY AND ESTIMATES The Company's consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America, and the Company follows general practices within the industries in which it operates. At times the application of these principles requires Management to make assumptions estimates and judgments that affect the amounts reported in the financial statements. These assumptions, estimates and judgments are based on information available as of the date of the financial statements. As this information changes, the financial statements could reflect different assumptions, estimates and judgments. Certain policies inherently have a greater reliance on assumptions, estimates and judgments and as such have a greater possibility of producing results that could be materially different than originally reported. Examples of critical assumptions, estimates and judgments are when assets and liabilities are required to be recorded at fair value, when a decline in the value of an asset not required to be recorded at fair value warrants an impairment write-down or valuation reserve to be established, or when an asset or liability must be recorded contingent upon a future event. Based on the valuation techniques used and the sensitivity of financial statement amounts to assumptions, estimates, and judgments underlying those amounts, management has identified the determination of the Allowance for Loan and Lease Losses (ALLL) and the valuation 4
ITEM 2 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS (Continued) of its Mortgage Servicing Rights as the accounting areas that requires the most subjective or complex judgments, and as such could be the most subject to revision as new information becomes available. The ALLL represents management's estimate of credit losses inherent in the Bank's loan portfolio at the report date. The estimate is composite of a variety of factors including past experience, collateral value and the general economy. ALLL includes a specific portion, a formula driven portion, and a general nonspecific portion. Farmers & Merchants Bancorp, Inc. was incorporated on February 25, 1985, under the laws of the State of Ohio. Farmers & Merchants Bancorp, Inc., and its subsidiaries The Farmers & Merchants State Bank and Farmers & Merchants Life Insurance Company are engaged in commercial banking and life and disability insurance, respectively. The executive offices of Farmers & Merchants Bancorp, Inc. are located at 307-11 North Defiance Street, Archbold, Ohio 43502. LIQUIDITY, CAPITAL RESOURCES AND MATERIAL CHANGES IN FINANCIAL CONDITION The bank experienced continued improvement in loan growth in the second quarter of $12 million, which is very similar to the first quarter of $14 million for a year to date total of $26 million. Commercial loans were the largest contributor to the portfolio with a second quarter increase of $13 million. Commercial real estate increased by $4 million in the quarter and all other loans in the portfolio experienced only minor increases or decreases. The average year to date loan to deposit ratio at second quarter end was 83.6% while the first quarter end was 81.3% and December was at 82.1%. The bank continued to decrease their investment portfolio by $22 million in the second quarter, combined with the $14 million from the first quarter, for a total of $36 million to help fund the loan growth. This was a better alternative than raising more expensive money in the CD markets. Overall, the Company assets are down $9.0 million from month end March 2006 and $17.4 million to year end December 2005. The reserve for possible loan loss was decreased in the second quarter due to the continued improvement in past due ratios coupled with strong loan quality in the portfolio. The past due ratios by month end were June at 0.73%, month end March at 1.16% and month end December at 1.37% respectively. Deposit production was down $20 million in the second quarter, while the first quarter was down $13 million for a year to date total of $33 million. The bank was not the most aggressive in pricing due to the availability of the investment portfolio and expensive competitor rates. This decrease comes mainly from the consumer portfolio CD base. The bank carried a "special" throughout the quarter. The bank focused on having or establishing a relationship (checking) account tied to CD programs. The goal was to offset the expensive CD money with a lower cost of funds and generate the opportunity for additional fee income. While CD's have left, checking accounts have increased approximately $1.5 million compared to a year ago. The program has brought to light just how many customers are rate shoppers only, without maintaining a full relationship. The Company continues to look for opportunities to provide services our customers want that aid in the profitability of the company. The net interest margin for December 2005 was at 3.79% with March dropping to 3.66% and June's being 3.70%. Some impact with the increase in loans has helped off set the higher cost of funds being impacted by continued Fed rate increases. The bank continues to focus it's attention on non interest income and ways to reduce the non interest expense side. The Board of Directors proposed and recommended to the stockholders of the Company, an increase in the number of shares of stock in the Company. They presented a 4:1 stock split and the stockholders voted in favor of the increased number of authorized shares to facilitate the split which was done on May 12, 2006. 5
ITEM 2 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS (Continued) MATERIAL CHANGES IN RESULTS OF OPERATIONS The income statement shows the effects of the tightening of the interest margin. Interest income for the six months ended June 2006 was $20.4 million while June 2005 was $18.5 million or $1.9 million increase which reflects the increase in the loan portfolio balances and higher loan rates. This is however off set by increased interest rates on deposits of $2.3 million for a net interest decrease of $400 thousand over the six months ended June year to year. Total non interest income reflects a 6.5% increase over the six months of June 2006 and June 2005. The primary contributions to the $187 thousand increase were in customer service fees, overdraft checking charges and gain on sale of assets. The total non interest expense reflects only a 1.3% increase or $121 thousand for the six months ended June 2006 to June 2005 time frames. Employee group insurance cost continues to go up, just the same as for all companies across the United States. Consulting fees on the overdraft checking program are higher for the six months ended June 2006 compared to June 2005. The bank was able to decrease or control some areas of expense compared to the prior year period. Auditing & examinations were $78 thousand lower, FDIC assessments were $90 thousand less due to lower rates in the current year. The provision for overdraft losses was much less in the six months ended June 2006 with being in the second year of offering overdraft privilege. Provision was higher in 2005 with the establishment of the original reserve for the overdraft privilege program. The company continues to be well-capitalized as the capital ratios below show: <TABLE> <S> <C> Primary Ratio 13.13% Tier I Leverage Ratio 12.26% Risk Based Capital Tier 1 16.55% Total Risk Based Capital 17.72% Stockholders' Equity/Total Assets 11.96% </TABLE> 6
ITEM 3 MARKET RISK Market risk is the exposure to loss resulting from changes in interest rates and equity prices. The primary market risk to which the Company is subject is interest rate risk. The majority of the Company's interest rate risk arises, from the instruments, positions and transactions entered into for the purposes, other than trading, such as loans, available for sale securities, interest bearing deposits, short term borrowings and long term borrowings. Interest rate risk occurs when interest bearing assets and liabilities reprice at different times as market interest rates change. For example, if fixed rate assets are funded with variable rate debt, the spread between asset and liability rates will decline or turn negative if rates increase. Interest rate risk is managed within an overall asset/liability framework for the Company. The principal objectives of asset/liability management are to manage sensitivity of net interest spreads and net income to potential changes in interest rates. Funding positions are kept within predetermined limits designed to ensure that risk-taking is not excessive and that liquidity is properly managed. The Company employs a sensitivity analysis in the form of a net interest rate shock as shown in the table following. <TABLE> <CAPTION> Interest Rate Shock on Net Interest Rate Shock on Net Interest Margin Interest Income - ---------------------------- -------------------------- Net Interest % Change to Rate Rate Cumulative % Change to Margin (Ratio) Flat Rate Direction Changes by Total ($000) Flat Rate - -------------- ----------- --------- ---------- ------------ ----------- <S> <C> <C> <C> <C> <C> 3.81% -6.623% Rising 3.000% 13,507 -6.981% 3.90% -4.388% Rising 2.000% 13,848 -4.633% 3.99% -2.180% Rising 1.000% 14,186 -2.306% 4.08% 0.000% Flat 0.000% 14,521 0.000% 4.07% -0.279% Falling -1.000% 14,484 -0.251% 4.03% -1.215% Falling -2.000% 14,280 -1.661% 3.96% -2.772% Falling -3.000% 13,980 -3.726% </TABLE> A slight improvement has occurred in the net interest margin in the flat rate environment as predicted due to loan growth. Current predicted margin in a flat rate environment is 4.08% as compared to March's 3.93%. All levels of exposure are well within the guidelines set by the risk committee. With the well capitalized position of the Company along with the low amount of risk indicated by the shock table, the Company can take some additional risk with minimal consequences. The bank will continue to analyze if a slight leveraging of the balance sheet by borrowing funds would be beneficial to fund loan growth or if raising the dollars within the communities that are served would be more economical. The net interest margin represents the forecasted twelve month margin. All of the predicted rates are higher than the current net interest margin, indicating the bank will continue to see improvement in the margin. As noted previously, the bank has experienced a slight improvement in the net interest margin in the second quarter as compared to the first. The Company remains committed to improve profitability through growth, both within the loan portfolio and in core deposits. Changing the mix and yields to improve profitability is the strategy the Company will continue to follow. 7
ITEM 4 CONTROLS AND PROCEDURES As of June 30, 2006, an evaluation was performed under the supervision and with the participation of the Company's management including the CEO and CFO, of the effectiveness of the design and operation of the Company's disclosure controls and procedures. Based on that evaluation, the Company's management, including the CEO and CFO, concluded that the Company's disclosure controls and procedures were effective as of June 30, 2006. There have been no significant changes in the Company's internal controls that occurred for the quarter ended June 30, 2006. PART II ITEM 1 LEGAL PROCEEDINGS None ITEM 1A There have been no material changes in the risk factors disclosed by Registrant in its Report on Form 10-K for the fiscal year ended December 31, 2005. ITEM 2 UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS <TABLE> <CAPTION> (c) Total Number of Shares (d) Maximum Number of Shares (a) Total Number (b) Average Price Purchased as Part of Publicly that may yet be purchased under Period of Shares Purchased Paid per Share Announced Plan or Progams the Plans or Programs - --------- ------------------- ----------------- ----------------------------- ------------------------------- <S> <C> <C> <C> <C> 4/1/2006 to 4/30/2006 -- -- -- 18,576 5/01/2006 to 5/31/2006 4,000 $23.75 4,000 14,576 6/01/2006 to 6/30/2006 1,576 $23.00 1,576 13,000 ----- ------ ----- ------ Total 5,576 $23.54 5,576(1) 13,000(2) ===== ====== ===== ====== </TABLE> (1) The Company purchased these shares pursuant to a stock repurchase program publicly announced on December 19, 2005. On that date, the Board of Directors authorized the repurchase of 5,000 common shares between January 1, 2006 and December 31, 2006. (2) The four-for one stock split effected by the Board of Directors on May 12, 2006 effectively increased the aggregate number of shares authorized for repurchase to 20,000. ITEM 3 DEFAULTS UPON SENIOR SECURITIES None ITEM 4 SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS The Annual Meeting of Shareholders of Farmers & Merchants Bancorp, Inc. was held on April 22, 2006. The following directors were elected to a new term of office: Dexter L. Benecke Joe E. Crossgrove Steven A. Everhart Robert G. Frey Jack C. Johnson Dean E. Miller Anthony J. Rupp David P. Rupp Jr. James C. Saneholtz Kevin J. Sauder Merle J. Short Paul S. Siebenmorgen Steven J. Wyse Betty K. Young Matters voted on at this meeting were: 1. A proposal to increase the number of Authorized Common Shares to 6.5 million. The results of the voting on this proposal are as follows: For Against Passed - --------- ------ ------ 1,023,201 104,174 X 8
ITEM 4 SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS (continued) 2. A proposal to amend the Corporation's Articles of Incorporation to allow future amendment thereto by a 66 2/3% vote of the shares voted, but not less than a Simple Majority of all of the voting power of the Corporation. The results of the voting on this proposal are as follows: <TABLE> <CAPTION> For Against Broker Non-Vote Passed - ------- ------- --------------- ------ <S> <C> <C> <C> 929,462 142,004 55,909 X </TABLE> 3. A proposal to elect fourteen (14) directors of the Corporation The results of the voting on this proposal are as follows: <TABLE> <CAPTION> For Withhold --------- -------- <S> <C> <C> Dexter L. Benecke 1,122,165 5,210 Joe E. Crossgrove 1,119,456 7,919 Steven A. Everhart 1,106,351 21,024 Robert G. Frey 1,104,366 23,009 Jack C. Johnson 1,104,034 23,341 Dean E. Miller 1,122,340 5,035 Anthony J. Rupp 1,099,764 27,611 David P. Rupp Jr. 1,119,571 7,804 James C. Saneholtz 1,113,971 13,404 Kevin J. Sauder 1,103,632 23,743 Merle J. Short 1,121,590 5,785 Paul S. Siebenmorgen 1,101,100 26,275 Steven J. Wyse 1,112,333 15,042 Betty K. Young 1,073,526 53,849 </TABLE> ITEM 5 OTHER INFORMATION ITEM 6 EXHIBITS <TABLE> <S> <C> 3.1 Amended Articles of Incorporation of the Registrant 3.2 Code of Regulations of the Registrant (incorporated by reference to Registrant's Quarterly Report on Form 10-Q filed with the Commission on May 10, 2004) 31.1 Rule 13-a-14(a) Certification -CEO 31.2 Rule 13-a-14(a) Certification -CFO 32.1 Section 1350 Certification - CEO 32.2 Section 1350 Certification - CFO </TABLE> 9
SIGNATURES Pursuant to the requirements of Section 13 or 15 (d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Farmers & Merchants Bancorp, Inc., Date: July 26, 2006 By: /s/ Paul S. Siebenmorgen ------------------------------------ Paul S. Siebenmorgen President and CEO Date: July 26, 2006 By: /s/ Barbara J. Britenriker ------------------------------------ Barbara J. Britenriker Exec. Vice-President and CFO 10
EXHIBIT INDEX <TABLE> <CAPTION> Exhibit No. Description - ----------- ----------- <S> <C> 3.1 Amended Articles of Incorporation of the Registrant 3.2 Code of Regulations of the Registrant (incorporated by reference to Registrant's Quarterly Report on Form 10-Q filed with the Commission on May 10, 2004) 31.1 Rule 13-a-14(a) Certification -CEO 31.2 Rule 13-a-14(a) Certification -CFO 32.1 Section 1350 Certification - CEO 32.2 Section 1350 Certification - CFO </TABLE>