EXHIBIT 10.3
REPUBLIC
BANCORP, INC
REPUBLIC
BANK & TRUST COMPANY
AMENDED AND RESTATED
OFFICER COMPENSATION
CONTINUATION
AGREEMENT
This is an Amended and
Restated Agreement, originally dated as of the 12 th day
of January, 1995 is made by and between Republic
Bancorp, Inc., a Kentucky corporation (the
“Company”), and Scott Trager (the
“Executive”), who is presently President, Louisville
Region, of Republic Bank & Trust Company (the
“Bank”) (the “Agreement”), in consideration
of the mutual covenants herein contained and in further
consideration of services performed and to be performed by the
Executive for the Company and/or its subsidiaries. As of the
date of this Agreement, Bank is a wholly-owned subsidiary of the
Company. This Agreement, as so amended and restated shall
supersede the prior agreements and all amendments thereto,
effective as of the date of its adoption. The Bank joins in
this Agreement to further accomplish the terms and objectives of
this Agreement.
Recitals
A.
The
Company considers the establishment and maintenance of sound and
vital management of the Company and its subsidiaries to be
essential to protecting and enhancing the best interests of the
Company and its shareholders.
B.
The
Company recognizes that, while not anticipated, the possibility of
a change of control may exist. Such possibility, and the
uncertainty and questions which it may raise among management of
the Company and its subsidiaries may result in the departure or
distraction of key members of management to the detriment of the
Company’s shareholders.
C.
The
Company’s Board of Directors has determined that appropriate
steps should be taken to encourage key members of management of the
Company and its subsidiaries, such as the Executive, to remain in
the employ of the Company and/or its subsidiaries and perform their
assigned duties without distraction in the face of potentially
disturbing circumstances arising from the possibility of a change
of control of the Company.
NOW, THEREFORE, in
consideration of the foregoing and of the covenants herein
contained, the parties hereto agree as follows:
Section 1 —
Definitions
For purposes of this
Agreement, the following words and terms shall have the following
meanings:
1.1
Termination by the Bank
of the Executive’s employment for “Cause”
shall mean termination upon (A) the willful and continued
failure by the Executive substantially to perform the
Executive’s duties with the Bank (other than any such failure
resulting from Disability or temporary incapacity due to physical
or mental illness), after a written demand for substantial
performance is delivered to the Executive by the Board of Directors
of the Bank (the “Bank Board”), which demand
specifically identifies the manner in which the Bank Board believes
that the Executive has not substantially performed his duties; or
(B) the willful engaging by the Executive in gross misconduct
materially and demonstrably injurious to the Bank or the
Company. For purposes of this definition, no act, or failure
to act, on the Executive’s part shall be considered
“willful” unless done, or omitted to be done, by the
Executive not in good faith and without reasonable belief that the
Executive’s action or omission was in the best interests of
the Bank or the Company.
1.2
A
“Change in Control” of the Company shall mean
(i) an event or series of events which have the effect
of any “person” as such term is used in
Section 13(d) and 14(d) of the Exchange Act,
becoming the “beneficial owner” as defined in
Rule 13d-3 under the Exchange Act, directly or indirectly, of
securities of the Company or the Bank representing a greater
percentage of the combined voting power of the Company’s or
Bank’s then outstanding stock, than the Trager Family Members
as a group; (ii) an event or series of events which have the
effect of decreasing the Trager Family Members’ percentage
ownership of the combined voting power of the Company’s or
Bank’s then outstanding stock to less than 25%;
(iii) any person (including the Company or the Bank) publicly
announces an intention to take or to consider taking actions which
have consummated would constitute a Change in Control, or
(iv) the Company Board adopts a resolution to the effect that
a Potential Change in Control for purposes of this Plan has
occurred. For purposes of this paragraph, “Trager
Family Member” shall mean Bernard M. Trager, Jean S.
Trager and any of their lineal descendants, and any corporation,
partnership, limited liability company or trust the majority owners
or beneficiaries of which are directly or indirectly through
another entity Bernard M. Trager, Jean S. Trager, or one or
more of their lineal descendants.
1.3
“Compensation”
shall mean the
Executive’s annual base salary at the greater of (A) the
highest rate in effect at any time during the twelve months
immediately preceding the applicable Date of Termination, or
(B) the rate in effect immediately prior to the applicable
Change in Control.
1.4
“Contract
Period” shall mean the period
defined in Section 2 hereof.
1.5
“Date
of Termination” shall mean (A) if
the Executive’s employment is terminated for Good Reason, as
defined below, the date specified in the Notice of Termination, as
defined in this Section 1.8 below; and (B) if the
Executive’s employment is terminated for any other reason,
the date on which a Notice of Termination is given; provided
that , if within 30 days after any Notice of Termination is
given, the party receiving such Notice of Termination notifies the
other party that a dispute exists concerning the termination, the
Date of Termination shall be the date on which the dispute is
finally determined, either by mutual written agreement of the
parties, by a binding and final arbitration award or by a final
judgment, order or decree of a court of competent jurisdiction (the
time for appeal therefrom having expired and no appeal having been
perfected).
1.6
“Disability”
shall mean a physical or
mental incapacity of the Executive which entitles the Executive to
benefits under any long-term disability plan or wage continuation
plan applicable to him and maintained by the Company as in effect
immediately prior to the applicable Change in Control.
1.7
“Good
Reason” shall mean:
(a)
Without the
Executive’s express written consent, the assignment to
Executive of any duties inconsistent with, or the reduction of
powers or functions associated with, his positions, duties,
responsibilities and status with the Company immediately prior to a
Change in Control, or any removal of Executive from, or any failure
to reelect Executive to, any positions or offices Executive held
immediately prior to a Potential Change in Control, except in
connection with the termination of Executive’s employment at
death, for Cause or on account of Retirement or Disability pursuant
to the requirements of this Agreement;
(b)
(i) the failure by
the Company to continue in effect any employee welfare or pension
benefit plans within the meaning of Sections 3(1) and
3(2) of the Employee Retirement Income Security Act of 1974
(the “Plans”), in which Executive was participating
immediately prior to a Potential Change in Control (or substitute
plans, programs or arrangements providing Executive with
substantially similar benefits),
(ii) the taking of
any action, or the failure to take any action, by the Company which
could (A) adversely affect Executive’s participation in,
or materially reduce Executive’s benefits under, any of the
Plans, (B) materially adversely affect the basis for computing
benefits under any of the Plans, or (C) deprive Executive of
any material fringe benefit enjoyed by Executive immediately prior
to a Potential Change in Control, or
(iii) the failure by
the Company to provide Executive with the number of paid vacation
days to which Executive was entitled immediately prior to a
Potential Change in Control in accordance with the Company’s
vacation policy applicable to Executive then in effect;
except, in each case, in
connection with the termination of Executive’s employment at
death, for Cause or on account of Retirement or Disability pursuant
to the requirements of this Agreement;
(c)
the
failure by the Company to obtain an assumption of the obligations
of the Company under this Agreement by any successor to the
Company;
(d)
a
reduction by the Bank in the Executive’s base salary as in
effect on the date hereof or as the same may be increased from time
to time, except as part of an across-the-board reduction of base
salaries applicable to all salaried employees of the Bank, provided
the reduction (or series of reductions) does not exceed 5% of the
Executive’s base salary prior to such change;
(e)
the
relocation of the Bank’s principal executive offices to a
location outside the metropolitan Louisville area; or the
Company’s requiring the Executive to be based anywhere other
than in the metropolitan Louisville area, except for required
travel on the Bank’s business to an extent substantially
consistent with similarly situated executives’ business
travel obligations;
(f)
any
purported termination of the Executive’s employment during
the contract period which is not effected pursuant to a Notice of
Termination satisfying the requirements of Section 3 below;
and for purposes of this Agreement, no such purported termination
shall be effective.
1.8
A
“Notice of Termination” shall mean a notice,
from the Bank or from the Executive, which shall indicate the
specific termination provision in this Agreement relied upon and
shall set forth in reasonable detail the facts and circumstances
claimed to provide a basis for termination of the Executive’s
employment under the provision so indicated.
1.9
“Plans”
shall have the meaning
given in Section 1.7(b).
1.10
Any
reference to “Subsidiaries” of the Company shall
include those subsidiaries owned by the Company directly or owned
by the Company indirectly through another company which is
wholly-owned by the Company.
Section 2 —
Application of Agreement
This Agreement shall
apply only to termination of employment of the Executive during a
period (the “Contract Period”) commencing on the date
immediately preceding the date of a Change in Control and
terminating on the second anniversary of the date of that Change in
Control; provided, however, that each such Change in Control occurs
during the period commencing as of January 1, 1995 and
terminating at midnight on December 31, 1998 or as further
extended pursuant to the following sentence. At midnight on
December 31, 1998, and on each annual anniversary of that time
and date thereafter, such latter period shall be automatically
extended for two additional years, unless on or before such
anniversary the Company notifies the Executive in writing that it
elects not to extend such period. There is one Contract
Period for each Change in Control and there may be multiple
Change(s) in Control. With respect to a termination
pursuant to Section 3.2 only, the Contract Period shall also
include the period from and after a Potential Change in
Control. If a Potential Change in Control occurs but a Change
in Control does not follow within one year of the Potential Change
in Control, the Contract Period shall expire on the one year
anniversary of the Potential Change in Control.
Section 3 —
Termination
3.1
Procedure for
Termination .
Any
termination by the Bank or by the Executive, pursuant to this
Agreement, shall be communicated by Notice of Termination to the
other parties hereto. The Executive shall not be deemed to
have been terminat
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