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Exhibit 10.2
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2005 R ESTATED
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SENIOR EXECUTIVE SEVERANCE AGREEMENT
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This
Agreement is made and entered into as of April 22, 2005 between
Stock Yards Bank and Trust Company, a Kentucky banking corporation
with its principal office located in Louisville, Kentucky (the
"Bank") and David P. Heintzman, with an address at 1040 East Main
Street, Louisville, Kentucky 40206 (the "Executive").
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Recitals
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A.
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The Bank is a wholly owned subsidiary of S.Y.
Bancorp, Inc., a Kentucky corporation and bank holding company ("SY
Bancorp").
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B.
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SY Bancorp, as the sole shareholder of the Bank,
considers the establishment and maintenance of a sound and vital
management team to be essential to protecting and enhancing the
best interests of the Bank, SY Bancorp, and SY Bancorp's
shareholders.
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C.
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SY Bancorp and the Bank recognize that, as is
the case with many publicly held bank holding companies, the
possibility exists that an unsolicited tender offer or takeover bid
and a consequent change of control of SY Bancorp may occur, and
thus, that as a practical matter, a change of control of the Bank,
may occur, and that such a possibility is unsettling and
distracting to key executives of the Bank.
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D.
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SY Bancorp and the Bank have concluded that it
is in the best interests of SY Bancorp, its shareholders and the
Bank to take reasonable steps to help assure certain key executives
of the Bank that, notwithstanding an unsolicited tender offer or
takeover bid, or an actual change of control, they will be treated
fairly and with concern for their welfare.
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E.
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SY Bancorp and the Bank have also concluded that
it is important that, should SY Bancorp receive takeover or
acquisition proposals from third parties, that it be able to call
upon the key executives of the Bank for their candid assessment and
advice concerning whether such proposals are in the best interests
of SY Bancorp, its shareholders and the Bank, free of the
influences caused by the uncertainties and risks of their own
personal employment situations.
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F.
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For the foregoing reasons the Board of Directors
of SY Bancorp and of the Bank have approved the Bank's entering
into severance agreements with key executives of the Bank.
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G.
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The Executive is a key executive of the Bank and
has been selected by the Bank's board of directors and by the board
of directors of the Bank's sole shareholder, SY Bancorp, as a key
executive to participate in this Agreement.
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H.
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The IRS recently finalized regulations under
Code Section 280G, and, in 2005, a new Code Section (409A) became
effective that impacts these agreements. These and other recent law
changes prompted restatement of Agreements entered into in earlier
years.
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Agreements
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NOW
THEREFORE , in consideration of these premises and for other
good and valuable consideration, the Bank and the Executive agree
as follows:
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1.
DEFINITIONS . As
used in this Agreement, the following terms shall have the
following meanings:
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"TERM"
shall mean the period commencing on the date first above written
and ending 36 months following written notice by the Bank or
Executive to the other.
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A
"CHANGE IN CONTROL" of SY Bancorp shall be deemed to have occurred
if:
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(i) any
Person (as defined in this definition) is or becomes the Beneficial
Owner (as defined in this definition) of securities of SY Bancorp
representing 20% or more of the combined voting power of SY
Bancorp's then outstanding securities (unless (A) such Person is
the Beneficial Owner of 20% or more of such securities as of April
26, 1995 or (B) the event causing the 20% threshold to be crossed
is an acquisition of securities directly from SY Bancorp);
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(ii) during
any period of two consecutive years beginning after April 26, 1995,
individuals who at the beginning of such period constitute the
Board of Directors of SY Bancorp and any new director (other than a
director designated by a person who has entered into an agreement
with SY Bancorp to effect a transaction described in clause (i),
(iii) or (iv) of this Change in Control definition) whose election
or nomination for election was approved by a vote of at least
two-thirds of the directors then still in office who either were
directors at the beginning of the period or whose election or
nomination for election was previously so approved cease for any
reason to constitute a majority of the Board of Directors of SY
Bancorp;
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(iii) the
shareholders of SY Bancorp approve a merger or consolidation of SY
Bancorp with any other corporation (other than a merger or
consolidation which would result in the voting securities of SY
Bancorp outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted
into voting securities of the entity surviving such merger or
consolidation), in combination with voting securities of SY Bancorp
or such surviving entity held by a trustee or other fiduciary
pursuant to any employee benefit plan of SY Bancorp or such
surviving entity or of any subsidiary of SY Bancorp or such
surviving entity, at least 80% of the combined voting power of the
securities of SY Bancorp or such surviving entity outstanding
immediately after such merger or consolidation); or
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(iv) the
shareholders of SY Bancorp approve a plan of complete liquidation
or dissolution of SY Bancorp or an agreement for the sale or
disposition by SY Bancorp of all or substantially all of SY
Bancorp's assets.
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(v) For
purposes of the definition of Change in Control, "Person" shall
have the meaning ascribed to such term in Section 3(a)(9) of the
Securities Exchange Act of 1934, as amended, as supplemented by
Section 13(d)(3) of such Act; provided, however, that Person shall
not include (i) SY Bancorp, any subsidiary or any other Person
controlled by SY Bancorp, (ii) any trustee or other fiduciary
holding securities under any employee benefit plan of SY Bancorp or
of any subsidiary, or (iii) a corporation owned, directly or
indirectly, by the shareholders of SY Bancorp in substantially the
same proportions as their ownership of securities of SY
Bancorp.
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(vi) For
purposes of the definition of Change in Control, a Person shall be
deemed the "Beneficial Owner" of any securities which such Person,
directly or indirectly, has the right to vote or dispose of or has
"beneficial ownership" (within the meaning of Rule 13d-3 under the
Securities Exchange Act of 1934, as amended) of, including pursuant
to any agreement, arrangement or understanding (whether or not in
writing); provided, however, that: (i) a Person shall not be deemed
the Beneficial Owner of any security as a result of an agreement,
arrangement or understanding to vote such security (x) arising
solely from a revocable proxy or consent given in response to a
public proxy or consent solicitation made pursuant to, and in
accordance with the Securities Exchange Act of 1934, as amended,
and the applicable rules and regulations thereunder or (y) made in
connection with, or to otherwise participate in, a proxy or consent
solicitation made, or to be made, pursuant to, and in accordance
with, the applicable provisions of the Securities Exchange Act of
1934, as amended, and the applicable rules and regulations
thereunder; in either case described in clause (x) or clause (y)
above, whether or not such agreement, arrangement or understanding
is also then reportable by such Person on Schedule 13D under the
Securities Exchange Act of 1934, as amended (or any comparable or
successor report); and (ii) a Person engaged in business as an
underwriter of securities shall not be deemed to be the Beneficial
Owner of any securities acquired through such Person's
participation in good faith in a firm commitment underwriting until
the expiration of forty days after the date of such
acquisition.
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"CAUSE"
for termination shall exist if the Executive (i) willfully and
continually fails to substantially perform his duties (other than
as a result of incapacity or temporary or Permanent Disability) for
the Bank as described in the most recent written description of
such duties maintained by the Bank's personnel department or as
communicated to the Executive after a written demand for
substantial performance is delivered to the Executive by the Bank's
board of directors specifically identifying the manner in which the
board of directors believes that the Executive has not
substantially performed his duties; or (ii) engages in gross
misconduct constituting a violation of law or breach of fiduciary
duty which misconduct is materially and demonstrably injurious to
the Bank.
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"CUSTOMER"
shall mean any firm, individual, corporation or entity which used
the facilities, products or services of the Bank during the twelve
(12) month period immediately preceding the voluntary or
involuntary termination of Executive's employment with the Bank;
but Customer shall not include any firm, individual, corporation or
entity with which Executive had a business relationship, either for
Executive or for Executive's previous employer, prior to the date
of Executive's employment with the Bank and which Executive
specifically identifies in writing to the Bank within thirty (30)
days following the date of Executive's employment with the Bank,
except that following eighteen (18) months employment with the
Bank, any such firm, individual, corporation or entity so
identified by Executive shall be deemed to have become a Customer
of the Bank if they otherwise meet the definition of "Customer" as
set forth above.
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"CODE"
means Internal Revenue Code of 1986, as amended.
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"FORCED
RESIGNATION" means a resignation at the Executive's initiative
following a Change in Control and the occurrence of any of the
following triggering events, provided such resignation occurs
within twelve (12) months after a triggering event or, if earlier,
within thirty-six (36) months after a Change in Control:
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(i) without
his express written consent, the Executive is assigned any duties
inconsistent with the positions, duties, responsibilities and
status he held with the Bank immediately prior to the Change in
Control, or a change occurs in the Executive's reporting
responsibilities, titles or offices as in effect immediately prior
to the Change in Control, or the Executive is removed from, or
there is a failure to re-elect the Executive to, any of such
positions, except in connection with the termination of the
Executive's employment for Cause, or Work Cessation, or as a result
of his death or Permanent Disability;
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(ii) a
reduction by the Bank in the Executive's salary as in effect on the
date hereof or as the same may have been increased from time to
time prior to the Change in Control;
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(iii) the
Bank's requiring the Executive to work from an office anywhere
other than at the Bank's (or its related Trust Department's)
principal executive offices, except for required travel on the
Bank's business to an extent substantially consistent with his
present business travel obligations or such obligations as are
incident to a promotion;
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(iv) the
failure by the Bank to continue in effect any deferred benefit or
compensation plan, pension plan, profit sharing plan, life
insurance plan, major medical or hospitalization plan or disability
plan in which the Executive is participating at the time of the
Change in Control (or plans providing substantially similar
benefits), or the taking of any action by the Bank which would
adversely affect the Executive's participation in, or materially
reduce his benefits under, any of such plans or deprive him of any
material fringe benefits; or
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(v) the
failure by the Bank to provide the Executive with the number of
paid vacation, illness, and personal leave days to which he is
entitled at the time of a Change in Control in accordance with the
Bank's normal personnel policy applicable to all employees.
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"WORK
CESSATION" shall mean the Executive's voluntary termination from
work for the Bank with no intention to seek or pursue other full
time business or employment within a reasonable period following
that cessation.
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"BASE
AMOUNT" shall have the meaning given to such term in Code Section
280G(b)(3).
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"PERMANENT
DISABILITY" means any mental or physical condition or impairment
which prevents the Executive from substantially performing his
duties for a period of more than ninety (90) consecutive days.
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"ACQUISITION
TRANSACTION" shall be deemed to have taken place if the
shareholders of SY Bancorp approve (a) a merger or consolidation of
SY Banc
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