2023PROXY STATEMENT &
NOTICE OF ANNUAL MEETING
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| Thursday, April 20, 2023 |
Republic Bank Building, Lower Level
9600 Brownsboro Road
Louisville, Kentucky 40241
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )
Filed by the Registrant ⌧
Filed by a Party other than the Registrant ◻
Check the appropriate box:
◻Preliminary Proxy Statement
◻Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
⌧Definitive Proxy Statement
◻Definitive Additional Materials
◻Soliciting Material under §240.14a-12
Republic Bancorp, Inc.
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
⌧No fee required.
◻Fee paid previously with preliminary materials.
◻Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a6(i)(1) and 0-11
2023PROXY STATEMENT &
NOTICE OF ANNUAL MEETING
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| Thursday, April 20, 2023 |
Republic Bank Building, Lower Level
9600 Brownsboro Road
Louisville, Kentucky 40241
Awards & Recognition
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| The 2022 American Bankers Association Foundation Community Commitment Award |
| Just seven banks across the U.S. were honored with Community Commitment Awards by the American Bankers Association (the “ABA”) Foundation. The ABA is the preeminent voice of the nation’s $23.7 trillion banking industry. Republic’s initiative uniting nine community banks to complete funding for the Louisville Urban League’s Norton Healthcare Sports and Learning Center was recognized by the ABA as an example for banks nationwide of how to make a difference in their communities. The ABA Foundation’s executive director said, “It’s wonderful to see an organization identify a need within its community and immediately get to work. We applaud Republic for its unwavering commitment to community and hope others throughout the industry will be inspired to give back and drive community change.” |
| Newsweek’s Best Banks in America 2022 |
| Newsweek named Republic Bank one of America's Best Banks for 2022, as the Best Bank in Kentucky with assets up to $10 billion. Newsweek reviewed more than 50 key factors of a financial institution to determine their ranking, including overall health of the bank, customer service performance and features, digital and branch presence, account and loan options, interest rate offerings, and fees. |
| 2022 Best Places to Work in Kentucky |
| Republic Bank was named one of the Best Places to Work in Kentucky for the sixth year in a row. This program was developed to identify and recognize Kentucky businesses that represent the ideal workplace environment through dedication and creativity. |
| Louisville Business First 2022 Business Impact Award |
| For the third year in a row, Republic Bank was honored by the American City Business Journal’s Louisville publication with their Business Impact Award. The award recognizes companies that further racial justice and equality in their community, and Republic was selected based on the impact of its Community Loan Fund. The Republic Community Loan Fund helps meet the needs of members of our communities who have had inadequate access to financial capital in the past. |
MESSAGE FROM THE EXECUTIVE CHAIR
March 10, 2023
Dear Fellow Shareholders,
You are cordially invited to attend the 2023 Annual Meeting of Shareholders of Republic Bancorp, Inc. (“Republic”) (the “Annual Meeting”). This Annual Meeting will be held at our Springhurst location, 9600 Brownsboro Road, Louisville, Kentucky 40241 on Thursday, April 20, 2023, at 10:00 am. Eastern Daylight Time.
The attached Notice of Meeting and Proxy Statement, as well as the Notice of Internet Availability of Proxy Materials you received in the mail, describe the formal business to be conducted at the Annual Meeting, and members of our Board of Directors and executive officers will be present at the Annual Meeting to respond to questions that our shareholders may have.
We have elected to provide access to our proxy materials over the Internet under the Securities and Exchange Commission’s “notice and access” rules. We are constantly focused on improving the ways shareholders connect with information about Republic and believe that providing our proxy materials over the Internet increases the ability of our shareholders to connect with the information they need, while reducing the environmental impact of our Annual Meeting.
Our Board of Directors has determined that the proposals to be considered at the Annual Meeting, as described in the attached Notice of Meeting and Proxy Statement, as well as in the Notice of Internet Availability of Proxy Materials, are in the best interests of Republic and its shareholders. For the reasons set forth in the Proxy Statement, the Board of Directors unanimously recommends that you vote:
| ● | “FOR” the election of each of the 16 director nominees named in this Proxy Statement; |
| ● | “FOR” the non-binding advisory approval of the compensation of our named executive officers; |
| ● | “FOR” “EVERY TWO YEARS” as it relates to the frequency of holding future non-binding advisory votes on the compensation of our named executive officers; and |
| ● | “FOR” the ratification of the appointment of Crowe LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2023. |
Whether or not you plan to attend the Annual Meeting, please vote and submit your proxy as soon as possible via the Internet, by telephone, or, if you have requested to receive printed proxy materials, by mailing a proxy or voting instruction card enclosed with those materials. Your vote is important.
On behalf of the Board of Directors and the officers and associates of Republic, I would like to take this opportunity to thank our shareholders for your continued support.
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By Order of the Board of Directors,
Steven E. Trager Republic Bancorp, Inc. |
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NOTICE OF ANNUAL MEETING
To Our Shareholders:
You are cordially invited to attend the 2023 Annual Meeting (the “Annual Meeting”) of Shareholders of Republic Bancorp, Inc. (the “Company”). The following are details for the meeting:
| Date Thursday | |
| Time 10:00 a.m. EDT |
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| Place Republic Bank Building, Lower Level | |
| Record Date The close of business on February 10, 2023 |
| Board | Read More | ||
| FOR each | Page 15 | ||
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Notice of Annual Meeting of Shareholders
of Republic Bancorp, Inc.
Thursday, April 22, 2021
To our shareholders: You are cordially invited to attend the virtual 2021 Annual Meeting of Shareholders of Republic Bancorp, Inc. The following are details for the meeting:
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Items on the agenda:
| FOR this proposal | | Page 69 |
Proposal 3 | | FOR EVERY TWO YEARS | | Page 70 |
Proposal 4 |
FOR this proposal | Page 71 | ||
To transact such other business as may properly come before the |
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We are mailing a Notice of Internet Availability of Proxy Materials (the “Notice”) to many of our common shareholders instead of paper copies of our proxy statement and our annual report. The Notice contains instructions on how to access those documents over the Internet. The Notice also contains instructions on how common shareholders can receive a paper copy of our proxy materials, including the proxy statement, our 2022 Annual Report to Shareholders and proxy card.
Your vote is important. For holders of Class A or Class B common stock, whether or not you plan to attend the Annual Meeting, we urge you to vote as soon as possible. Promptly voting will help ensure that the greatest number of common shareholders are present whether in person or by proxy. You may vote in person at the Annual Meeting, over the Internet, by telephone, or, if you requested to receive printed proxy materials, by mailing a proxy or voting instruction card enclosed with those materials. Please review the instructions with respect to each of your voting options described in the proxy statement and the Notice.
| Internet Go to www.investorvote.com/RBCAA | |
| Proxy Services c/o Computershare Investor Services PO Box 43101 |
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| In Person Attend the annual meeting and cast your vote in person | |
| Phone Call toll free |
| The proxy statement and annual report to shareholders are available online at www.investorvote.com/RBCAA. |
Very truly yours,
Christy A. Ames | Important Notice Regarding the Availability of Proxy Materials for the Shareholder Meeting to be Held on April 20, 2023. The proxy statement and annual report to shareholders are available online at www.investorvote.com/RBCAA. |
TABLE OF CONTENTS
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Proposal Two: Advisory Vote on the Compensation of Our Named Executive Officers | | 69 |
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Proposal Four: Ratification of Independent Registered Public Accounting Firm | | 71 |
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This proxy statement, notice of annual meeting, and form of proxy are first being mailed or made available to shareholders on or about March 11, 2022. As used in this document, the terms “Republic,” the “Company,” “we,” and “our” refer to Republic Bancorp, Inc., a Kentucky corporation. |
This proxy statement is furnished in connection with the solicitation of proxies by the Board of Directors of Republic Bancorp, Inc. (the “Company” or “Republic”). The proxies will be voted at the 2023 Annual Meeting of Shareholders (“Annual Meeting”) of Republic on April 20, 2023 and at any adjournments or postponements thereof of the Annual Meeting. The close of business on February |
The Company encourages you to attend the virtual Annual Meeting. To be admitted as a shareholder to the Annual Meeting at www.meetingcenter.io/[*], you must enter the control number found on your
PROXY SUMMARY
This proxy cardstatement summary highlights information about Republic Bancorp, Inc. and the password [*].
Your vote is important. For holders of Class A or Class B Common Stock, whether or not you plan to virtually attend the Annual Meeting, we urge you to vote and submit yourcertain information contained elsewhere in this proxy in advance of the meeting by one of the methods described in the proxy materials for the virtual Annual Meeting. The enclosed proxy card may be used to vote your stockstatement, which has been prepared in connection with the virtual Annual Meeting. While itThis summary does not contain all the information that you should consider in voting your shares. You should read the entire Proxy Statement carefully before voting.
About Republic
Republic is not necessary if you have submitted your proxya financial holding company headquartered in advance, you may vote duringLouisville, Kentucky. Republic Bank & Trust Company (“Republic Bank” or the virtual Annual Meeting by following“Bank”) is a Kentucky-based, state-chartered nonmember financial institution that provides both traditional and non-traditional banking products. The Bank is a wholly owned subsidiary of the instructions availableCompany.
Republic Bank offers its clients deposit products, including savings, checking, and money market accounts; IRAs; and CDs. The Bank originates residential mortgage loans, home equity loans and lines, and consumer loans, as well as commercial real estate loans, C&I loans, business loans and lines of credit, equipment leasing, and warehouse lines of credit. The Bank also offers personal and business online banking at www.republicbank.com, and mobile banking on its mobile apps for iOS and Android.
Republic Bank Banking Center Locations
As of December 31, 2022, the virtual meeting’s website. You will have the ability to submit questions live at the virtual Annual Meeting. The Company will not limit the time allowed to ask questions. A support line will be available on the meeting website for any questions on how to participate or you may call 1-[*].Bank had 42 full-service banking centers throughout five states: 28 banking centers in eight Kentucky communities – Covington, Crestview Hills, Florence, Georgetown, Lexington, Louisville, Shelbyville, and Shepherdsville; three banking centers in southern Indiana – Floyds Knobs, Jeffersonville, and New Albany; seven banking centers in six Florida communities (Tampa MSA) – Largo, New Port Richey, St. Petersburg, Seminole, Tampa, and Temple Terrace; two banking centers in two Tennessee communities (Nashville MSA) – Cool Springs and Green Hills; and two banking centers in two Ohio communities (Cincinnati MSA) – Norwood and West Chester.
In addition to full-service banking services offered in the Bank’s retail footprint, Republic also provides mortgage banking services and financial products to customers in select states across the U.S. Some financial products are offered also through the Company’s Republic Processing Group (“RPG”). Sponsorship of prepaid card products, small dollar credit programs, and payment processing are areas of the fintech ecosystem where RPG is active.
As of December 31, 2022, Republic had total assets of $5.8 billion, total deposits of $4.5 billion, and total shareholders’ equity of $857 million. Republic’s executive offices are located at 601 West Market Street, Louisville, Kentucky 40202.
Our Values
Republic’s values are built upon making an IMPACT for our clients, our associates, and the communities we serve. IMPACT is an acronym for the actions we do to fulfill our purpose.
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Innovate for the Future | | Make it Easy | | Provide Exceptional Service | | Acknowledge & Celebrate Success | | Commit to Caring | | Thrive Together |
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Our Beliefs
Our beliefs guide our actions to deliver on our purpose.
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Our Purpose: Republic Bank exists to enable our clients, Company, associates, and the communities we serve to thrive.
Our Clients
Since its founding over 40 years ago, Republic has had an unwavering focus on customer service and satisfaction.
The Net Promoter Score (“NPS”) is one of the most widely used measures of customer satisfaction, utilized by hundreds of leading U.S. companies. Republic’s most recent NPS score, measured in September 2022, was 44.2, nearly double the average NPS score for all banks measured in Q3 20221. As important, this was a 16% increase from our prior survey, showing the results of our constant efforts to provide industry-leading customer service.
Expanding Republic’s client base to communities that have been historically marginalized continues to be a priority for Republic. The Bank’s Community Loan Fund, launched in 2020 during the pandemic and the height of racial tensions in Louisville, Kentucky and beyond, has provided small business clients over $3 million in funding and has promoted business development, expanded services, and job creation in low-to-moderate income communities.
1Qualtrics XM Institute Q3 2022 Consumer Benchmark Study. The score is not a percentage, but a figure resulting from a formula that weighs satisfied, neutral, and dissatisfied customers.
Our Company
Governance is an essential element of ensuring the Company, and our clients, associates and communities thrive.
| ● | Board Diversity – Each of the Republic Board of Directors (the “Board” or the “Board of Directors”) and the Republic Bank Board of Directors is a diverse group of esteemed professionals across a variety of industries. Their direction, advice, and voices represent broad viewpoints. |
| ● | Fraud & Cybersecurity – The Company invests significant resources to prevent and combat fraud and cybersecurity issues, including robust processes and tools, annual associate and Board training and awareness, and regular assessments of our practices reported to the Board. |
| ● | Ethics Hotline – Republic has established an independent hotline available 24 hours/day and 365 days/year for the anonymous reporting of ethics and compliance issues in such areas as discrimination, criminal misconduct, and security. Findings are investigated and reported to the Audit Committee of the Board. |
| ● | Training – All associates are required to take specific functional, regulatory, and governance-related training. Talent Development assigns and monitors completion of these trainings. |
| ● | Vendor Management – Republic’s processes provide end-to-end oversight of vendor partnerships, from the evaluation of potential vendors, including intentional practices to expand the diversity of the Company’s vendors, to the regular review of contracted vendors, and through to a vendor contract’s termination. |
Our Associates
We are taking significant actions to grow a more inclusive and diverse workplace through education, mentorship, and recruiting.
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2023 PROXY STATEMENT | 3 |
Republic Bank facilitates Business Resource Groups (“BRGs”) for its associates to foster inclusive and diverse education and learning opportunities, recruitment, and advice for Bank leadership on how the Bank conducts day-to-day and long-term business. Currently, there are six BRGs, with active participation and self-leadership by associates who identify, or ally, with the group. The BRGs include Conexion (Hispanic), Nia (Black), Pride (LGBTQ+), Women, Veterans, and Caregivers.
In addition to health benefits including medical, dental, vision and Teladoc services, the Bank helps its associates thrive with programs including hybrid and work-from-home opportunities; a 401(k) plan; an Employee Stock Purchase Plan providing discounted opportunities to share in Company ownership; college tuition reimbursement; and an Employee Assistance Program for individual and family mental health, wellness, and limited legal support.
Key to the Bank’s continued improvement and success are formal and informal listening programs such as the below that allow leadership to learn from associates at all levels – those who are closest to our clients, to their fellow associates, and to our communities.
| ● | An annual anonymous associate engagement survey has 95% employee participation and guides leadership on key planning and decision making. |
| ● | A CEO Council consisting of associates from throughout the organization meets regularly with our top executives and provides insight and ideas. |
| ● | A “Suggestions to the CEO” e-mail mailbox provides daily opportunities for associates at all levels to share their ideas. |
| ● | An anonymous Ethics and Compliance Hotline, facilitated by a third party, provides a platform for associates to report issues and concerns. |
Our Communities
Republic recognizes the importance of making a lasting IMPACT, and that starts by strengthening the communities in which we live and work. As an organization, we devote time and funding to help support and build a foundation for the future.
| ● | In the last three years, over $7.4 million has been donated to more than 700 service organizations, and Bank associates have performed more than 21,000 hours of volunteer service in our communities. |
| ● | During the same period, the Bank has made more than $700 million in mortgage loans to low- and moderate-income families and community development loans for affordable housing, community services, and revitalization of underserved communities. |
2022 was the Bank’s 40th anniversary, and to celebrate, the Bank created a special concentrated period of “40 Acts of Service” with hundreds of Republic associates volunteering their time to help the Bank’s communities thrive.
4 | Republic Bancorp, Inc. |
Annual Meeting
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5BWHEN Thursday, April 20, 2023 | | Where Republic Bank Building, Lower Level | | 7RECORD DATE February 10, 2023 |
Voting Guide
Proposal 1: Election of 16 Directors (see page 15) |
The Board of Directors believes that each of these nominees brings a range of relevant experiences and overall diversity of perspectives that is essential to good governance and leadership of our Company. | OUR BOARD RECOMMENDS A VOTE FOR EACH DIRECTOR NOMINEE |
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Proposal 2: NON-BINDING ADVISORY VOTE ON THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS (Say ON PAY) (see page 69) |
The Board of Directors believes that our compensation policies and practices are effective in rewarding executives for job performance and motivating our named executive officers to achieve our collective goals as an organization. | OUR BOARD RECOMMENDS A VOTE FOR PROPOSAL |
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Proposal 3: NON-BINDING ADVISORY VOTE ON THE FREQUENCY OF HOLDING NON-BINDING ADVISORY VOTES ON THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS (Say WHEN on Pay) (see page 70) |
The Board of Directors believes that shareholders should continue to have an advisory vote providing their input on named executive officers’ pay every two years. | OUR BOARD RECOMMENDS A VOTE FOR EVERY TWO YEARS |
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Proposal 4: Ratification of Independent Registered Public Accounting Firm (see page 71) |
The Audit Committee has selected Crowe LLP to serve as our independent registered public accounting firm for the fiscal year ending December 31, 2023 and is asking shareholders to ratify this selection. | OUR BOARD RECOMMENDS A VOTE FOR PROPOSAL |
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2023 PROXY STATEMENT | 5 |
Snapshot of Board Nominees
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Name | Primary Occupation | Independent | | Audit | | Compensation | | Nominating | | Company |
David P. Feaster | Retired, Consultant to Republic Bank & Trust Company | | | | | | | |||
Jennifer N. Green | Vice President, Global Mergers & Acquisitions of YUM! Brands |
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Heather V. Howell | Director of Global Innovation and Trademark Development for the Jack Daniel Brands, Brown-Forman Corporation |
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Timothy S. Huval | Chief Administrative Officer of Humana, Inc. |
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Ernest W. Marshall, Jr. | Executive Vice President and Chief Human Resources Officer of Eaton Corporation |
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W. Patrick Mulloy, II | Of Counsel, Wyatt, Tarrant & Combs |
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George Nichols III | President and Chief Executive Officer of The American College of Financial Services |
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| CEO of OPM Services, Inc. a Financial Services and Investment Firm |
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| President and CEO of Republic Bank & Trust Company | | | | | | ||||
Vidya Ravichandran | CEO of GlowTouch, LLC, a Business Process Outsourcing Provider for Customer Care and Technology Services |
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Michael T. Rust | Retired, President of the Kentucky Hospital Association |
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Susan Stout Tamme | Retired, President of Baptist Health Collaborations |
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A. Scott Trager | President of Republic Bancorp, Inc. and Vice Chair of Republic Bank & Trust Company | | | | | | | | | |
Steven E. Trager, | Executive Chair & CEO of Republic Bancorp, Inc. and Executive Chair of Republic Bank & Trust Company | | | | | |||||
6 | Republic Bancorp, Inc. |
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Name | Primary Occupation | Independent | | Audit | | Compensation | | Nominating | | Company |
Andrew Trager-Kusman | Senior Vice President, Chief Strategy Officer of Republic Bank & Trust Company | | | | ||||||
Mark A. Vogt | CEO of Galen College of Nursing |
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2023 PROXY STATEMENT | 7 |
Financial Performance Highlights at Fiscal Year End
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net income | | diluted eps PER CLASS A COMMON STOCK | | TRADITIONAL BANK LOAN balances |
$91.1M | | $4.59 | | $3.9B |
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Compensation Highlights
In 2022, the Company designed its compensation program to establish and maintain suitable financial compensation and rewards for job performance that focused primarily on whether the Company’s profit objectives had been substantially met. The Company’s Say-on-Pay results continued to affirm the Company is making sound decisions relative to its executive compensation and performance. | |
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| What we do | |
| what we do not do |
Important Notice Regarding the Availability
●Compensation mix designed to link pay to job, business unit, and Company performance ●Goals assigned to certain executive officers in the primary areas of loan and deposit growth, loan loss control, risk management, regulatory control, customer service, product development, and operations ●Maintain stock ownership requirements for executive officers and directors ●Dedicate significant time each year to robust executive succession planning and leadership development | ●Offer employment agreements to our executive officers ●Provide gross-up payments to cover excess parachute payment excise taxes for executive officers ●Allow margin, derivative or speculative transactions with our Company stock, such as hedges, pledges and margin accounts, by executive officers and directors | |
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2022 PERFORMANCE-BASED COMPENSATION
8 | Republic Bancorp, Inc. |
Table of Proxy MaterialsContents
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for the Shareholder Meeting to be Held on April 22, 2021.
The proxy statement and annual report to shareholders are available online at www.investorvote.com/RBCAA.
Republic Bancorp, Inc.VOTING
601 West Market Street
Louisville, Kentucky 40202
PROXY STATEMENT
This proxy statement is furnished in connection with the solicitation of proxies by the Board of Directors of Republic Bancorp, Inc. (the “Company” or “Republic”). The proxies will be voted at the 2021 virtual Annual Meeting of Shareholders (“Annual Meeting”) of Republic on April 22, 2021 and at any adjournments of the meeting.
This proxy statement, notice of annual meeting, and form of proxy are first being mailed or made available to shareholders on or about March 12, 2021. As used in this document, the terms “Republic,” the “Company,” “we,” and “our” refer to Republic Bancorp, Inc., a Kentucky corporation.
VOTING
Record dateDate. You are entitled to notice of and to vote at the Annual Meeting if you held of record shares of our Class A Common Stock or Class B Common Stock at the close of business on February 19, 2021.10, 2023. On that date, [*]17,596,420 shares of Class A Common Stock and [*]2,159,495 shares of Class B Common Stock were issued and outstanding for purposes of the Annual Meeting.
Voting rights.Rights. Each share of Class A Common Stock is entitled to one (1) vote and each share of Class B Common Stock is entitled to ten (10) votes. Based on the number of shares outstanding as of the record date, the shares of Class A Common Stock are entitled to an aggregate of [*]17,596,420 votes, and the shares of Class B Common Stock are entitled to an aggregate of [*]21,594,950 votes at the Annual Meeting.
Voting by proxy.Proxy. If you received the Notice of Internet Availability of Proxy Materials, you may follow the instructions on that notice to access the proxy materials and download the proxy and vote online via the Internet. If you request a paper or electronic copy of the proxy materials, the proxy will be mailed or e-mailed to you along with the other proxy materials. If you received a paper copy of this proxy statement, the proxy card is enclosed. If a proxy card is properly executed, returned to Republic and not revoked, the shares represented by the proxy card will be voted in accordance with the instructions set forth on the proxy card. If no instructions are given, the shares represented will be voted (i) “For” each of the Board of Director nominees named in this proxy statement, (ii) “For” the approval, on an advisory basis, of the compensation of our Named Executive Officers, as disclosed in this proxy statement, (iii) “For” approval to amend the Bylaws to increase limitationsoption of “Every Two Years” as the frequency with which shareholders are provided an advisory vote on the authorized numbercompensation of Directors;its Named Executive Officers included in the Company’s proxy statement, and (iv) “For” the ratification of Crowe LLP as the Company’s independent registered public accounting firm for 2021.the fiscal year ending December 31, 2023. For participants in the Republic Bancorp, Inc. 401(k) Retirement Plan (the “Plan”), the Plan Trustee shall vote the shares for which it has not received voting direction from the Plan participants utilizing the same voting percentages derived from the Plan participants who did direct how their shares are to be voted.
The Board of Directors at present knows of no other business to be brought before the Annual Meeting. However, persons named in the proxy, or their substitutes, will have discretionary authority to vote on any other business which may properly come before the Annual Meeting and any adjournment or postponement thereof and will vote the proxies in accordance with the recommendations of the Board of Directors.
You may attend the virtual Annual Meeting even though you have executed a proxy. You may revoke your proxy at any time before it is voted at the Annual Meeting by delivering written notice of revocation to the Secretary of Republic, by delivering a subsequent dated proxy, by voting by telephone or online through the Internet on a later date, or by attending the virtual Annual Meeting and voting online.in person.
Shares held in Street Name. If you hold your shares in a stock brokerage account or if your shares are held by a bank, broker, trustee or other nominee (that is, in “street name”), please follow the voting instructions provided by your broker, bank, trustee or other nominee. Please note that you may not vote shares held in street name by returning a proxy card directly to Republic, or by voting at the virtual Annual Meeting website unless you provide a “legal proxy,” which you must obtain from your bank, broker, trustee or other nominee. Each such beneficial owner of Republic shares must fax or email a scan or image of the legal proxy to [*] at [*] no later than [*], 2021 at [*], EDT, to vote at the virtual Annual Meeting via the meeting website.
2
Quorum and voting requirementsVoting Requirements and counting votes.Counting Votes. The presence in person or by proxy of the holders of a majority in voting power of the combined voting power of the Class A Common Stock and the Class B Common Stock will constitute a quorum for the transaction of business at the Annual Meeting. Abstentions and broker non-votes will be counted as being present or represented at the Annual Meeting for the purpose of establishing a quorum. A broker non-vote occurs when a nominee holding shares for a beneficial owner is otherwise present by proxy but does not vote on a particular proposal because the nominee does not have discretionary voting power with respect to that item and has not received voting instructions from the beneficial owner.
The affirmative vote of a plurality of the votes duly cast is required for the election of Directors.each director. Regarding Proposal 3, Non-Binding Advisory Vote on the Frequency of Holding Non-Binding Advisory Votes on the Compensation of our Named Executive Officers, the option that receives the highest number of votes will be deemed to have been selected by shareholders. All other matters presented at the meetingAnnual Meeting will be approved if the votes cast in favor of the proposal exceed the votes cast opposing the proposal. Abstentions and broker non-votes are not counted as votes cast on any matter to which they relate and will have no impact on the outcome of any matter.matter except for quorum purposes.
SHARE OWNERSHIP
The following table sets forth certain information regarding the beneficial ownership of the outstanding shares of Republic common stock as of February 19, 2021,10, 2023, based on information available to the Company. On that date, 17,596,420 shares of Class A Common Stock and 2,159,495 shares of Class B Common Stock were issued and outstanding. The Class B Common Stock is convertible into Class A Common Stock on a share-for-share basis. In the following table, information in the column headed “Class A Common Stock” does not reflect the shares of Class A Common Stock issuable upon conversion of Class B Common Stock. Information is included for:
| (1) | persons or entities who own more than 5% of the Class A Common Stock or Class B Common Stock outstanding; |
| (2) | all Directors and |
| (3) | the |
| (4) | all executive officers (“Executive |
Except as otherwise noted, Republic believes that each person named below has the sole power to vote and dispose of all shares shown as owned by such person. Please note that the table provides information about the number of shares beneficially owned, as opposed to the voting power of those shares. The amounts and percentages of common stock beneficially owned are reported on the basis of the regulations of the SECU.S. Securities and Exchange Commission (the “SEC”) governing the determination of beneficial ownership of securities. Under these rules, a person is deemed to be a beneficial owner of a security if that person has or shares voting power, which includes the power to vote or to direct the voting of such security, or investment power, which includes the power to dispose of or to direct the disposition of such security. A person is also deemed to be a beneficial owner of any securities of which that person has a right to acquire beneficial ownership within 60 days of February 19, 2021.10, 2023. Under these rules, more than one person may be deemed to be a beneficial owner of the same securities. Included in the amount of common stock beneficially owned are shares of common stock subject tounderlying options and other derivative securities that are currently exercisable options or options that will become exercisable within 60 days of February 19, 2021. The calculation10, 2023. Ownership percentages reflect the ownership percentage assuming that such person, but no other person, exercises all options and other derivative securities to acquire shares of percent owned by each person assumes that all such optionsour common stock held by such person have been exercised.that are currently exercisable or exercisable within 60 days of February 10, 2023. The calculationownership percentage of percent owned by all Directors, Nomineesexecutive officers and Executive Officersdirectors, as a group, assumes that all such25 persons, but no other persons, exercise all options beneficiallyand other derivative securities to acquire shares of our common stock held by them have been exercised.such persons that are currently exercisable or exercisable within 60 days of February 10, 2023. Unless otherwise indicated, the mailing address for each beneficial owner is c/o Republic Bancorp, Inc., 601 West Market Street, Louisville, Kentucky, 40202. If applicable, fractional shares are rounded to the closest whole number.
3
10 | Republic Bancorp, Inc. |
Executive Officers, Directors, and Director Nominees as a group (collectively 25 persons) beneficially own 71%73% of the combined voting power of the Class A and Class B Common Stock, which represents 53%55% of the total number of shares of Class A and Class B Common Stock outstanding as of February 19, 202110, 2023 as detailed below:
| | | | | | | | | | | | | |
| | | | | | | | | | Class A and Class B Common | | ||
|
| Class A Common Stock | | Class B Common Stock | | Stock Combined | | ||||||
Name |
| Shares |
| Percent |
| Shares |
| Percent |
| Shares |
| Percent |
|
Five Percent Shareholders: |
| | | | | | | | | | | | |
|
| | | | | | | | | | | | |
Steven E. Trager |
| 8,499,127 | (1) | 45.4 | % | 1,940,091 | (2) | 88.2 | % | 10,439,218 | (1)(2) | 49.9 | % |
601 West Market Street |
| | | | | | | | | | | | |
Louisville, Kentucky 40202 |
| | | | | | | | | | | | |
|
| | | | | | | | | | | | |
Jean S. Trager |
| 8,398,288 | (3) | 44.8 | | 1,921,862 | (4) | 87.4 | | 10,320,150 | (3)(4) | 49.3 | |
601 West Market Street |
| | | | | | | | | | | | |
Louisville, Kentucky 40202 |
| | | | | | | | | | | | |
|
| | | | | | | | | | | | |
A. Scott Trager |
| 8,182,606 | (5) | 43.7 | | 1,956,647 | (6) | 89.0 | | 10,139,253 | (5)(6) | 48.4 | |
601 West Market Street |
| | | | | | | | | | | | |
Louisville, Kentucky 40202 |
| | | | | | | | | | | | |
|
| | | | | | | | | | | | |
Sheldon G. Gilman |
| 7,967,617 | (7) | 42.5 | | 1,921,862 | (8) | 87.4 | | 9,889,479 | (7)(8) | 47.2 | |
500 West Jefferson Street |
| | | | | | | | | | | | |
Suite 2100 |
| | | | | | | | | | | | |
Louisville, Kentucky 40202 |
| | | | | | | | | | | | |
|
| | | | | | | | | | | | |
Teebank Family |
| 7,165,276 | | 38.2 | | 1,753,796 | | 79.8 | | 8,919,072 | | 42.6 | |
Limited Partnership (9) |
| | | | | | | | | | | | |
601 West Market Street |
| | | | | | | | | | | | |
Louisville, Kentucky 40202 |
| | | | | | | | | | | | |
|
| | | | | | | | | | | | |
Jaytee Properties |
| 750,067 | | 4.0 | | 168,066 | | 7.6 | | 918,133 | | 4.4 | |
Limited Partnership (9) |
| | | | | | | | | | | | |
601 West Market Street |
| | | | | | | | | | | | |
Louisville, Kentucky 40202 |
| | | | | | | | | | | | |
|
| | | | | | | | | | | | |
BlackRock, Inc. |
| 1,017,729 | (10) | 5.4 | | — | | — | | 1,017,729 | (10) | 4.9 | |
55 East 52nd Street |
| | | | | | | | | | | | |
New York, New York 10055 |
| | | | | | | | | | | | |
|
| | | | | | | | | | | | |
|
| | | | | | | | | | | | |
Directors, Nominees and |
| | | | | | | | | | | | |
Named Executive Officers: |
| | | | | | | | | | | | |
|
| | | | | | | | | | | | |
Ronald F. Barnes | | 513 | (11) | * | | — | | * | | 513 | (11) | * | |
Campbell P. Brown | | 375 | (12) | * | | — | | * | | 375 | (12) | * | |
Laura M. Douglas | | 300 | (13) | * | | — | | * | | 300 | (13) | * | |
David P. Feaster | | 2,334 | | * | | — | | * | | 2,334 | | * | |
Craig A. Greenberg | | 375 | (14) | * | | — | | * | | 375 | (14) | * | |
Heather V. Howell | | 375 | (15) | * | | — | | * | | 375 | (15) | * | |
Ernest W. Marshall, Jr. | | 175 | (16) | * | | — | | * | | 175 | (16) | * | |
W. Patrick Mulloy, II | | 16,636 | (17) | * | | — | | * | | 16,636 | (17) | * | |
George Nichols, III | | 58 | (18) | * | | — | | * | | 58 | (18) | * | |
W. Kenneth Oyler, III | | 375 | (19) | * | | — | | * | | 375 | (19) | * | |
Michael T. Rust |
| 3,358 | (20) | * | | — | | * | | 3,358 | (20) | * | |
Susan Stout Tamme |
| 11,420 | (21) | * | | — | | * | | 11,420 | (21) | * | |
Andrew Trager-Kusman | | — | (22) | * | | — | | * | | — | (22) | * | |
Mark A. Vogt | | 17,391 | (23) | * | | — | | * | | 17,391 | (23) | * | |
Juan M. Montano | | 18,881 | (24) | * | | — | | * | | 18,881 | (24) | * | |
William R. Nelson | | 25,545 | (25) | * | | — | | * | | 25,545 | (25) | * | |
Logan M. Pichel |
| 8,319 | (26) | * | | — | | * | | 8,319 | (26) | * | |
Kevin D. Sipes |
| 77,052 | (27) | * | | — | | * | | 77,052 | (27) | * | |
A. Scott Trager | | 8,182,606 | (5) | 43.7 | | 1,956,647 | (6) | 89.0 | | 10,139,253 | (5)(6) | 48.4 | |
Steven E. Trager |
| 8,499,127 | (1) | 45.4 | | 1,940,091 | (2) | 88.2 | | 10,439,218 | (1)(2) | 49.9 | |
|
| | | | | | | | | | | | |
Directors. Nominees and All |
| | | | | | | | | | | | |
Executive Officers (25 persons): |
| 9,060,646 | (28) | 48.4 | % | 1,974,876 | (28) | 89.8 | % | 11,035,522 | (28) | 52.7 | % |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| | |
| | | | | | | Class A and Class B Common | | ||
|
| Class A Common Stock |
| Class B Common Stock |
| Stock Combined | | ||||||
Name |
| Shares |
| Percent |
| Shares |
| Percent |
| Shares |
| Percent | |
Five Percent Shareholders: | | | | | | | | | | | | | |
| | | | | | | | | | | | | |
Steven E. Trager | | 8,399,127 | (1) | 47.7 | % | 1,940,091 | (2) | 89.8 | % | 10,339,218 | (1)(2) | 52.3 | % |
601 West Market Street | |
|
|
|
| |
|
|
| |
|
| |
Louisville, Kentucky 40202 | |
|
|
|
| |
|
|
| |
|
| |
| |
|
|
|
| |
|
|
| |
|
| |
Trager Trust of 2012 | | 7,915,343 | (3) | 45.0 |
| 1,921,862 | (4) | 89.0 |
| 9,837,205 | (3)(4) | 49.8 | |
601 West Market Street | |
| |
|
| | |
|
| | |
| |
Louisville, Kentucky 40202 | |
| |
|
| | |
|
| | |
| |
| |
| |
|
| | |
|
| | |
| |
A. Scott Trager | | 8,226,790 | (5) | 46.7 |
| 1,923,916 | (6) | 89.1 |
| 10,150,706 | (5)(6) | 51.4 | |
601 West Market Street | |
| |
|
| | |
|
| | |
| |
Louisville, Kentucky 40202 | |
| |
|
| | |
|
| | |
| |
| |
| |
|
| | |
|
| | |
| |
Sheldon G. Gilman | | 7,967,617 | (7) | 45.3 |
| 1,921,862 | (8) | 89.0 |
| 9,889,479 | (7)(8) | 50.1 | |
3513 Winterberry Cir | |
| |
|
| | |
|
| | |
| |
Louisville, Kentucky 40207 | |
| |
|
| | |
|
| | |
| |
| |
| |
|
| | |
|
| | |
| |
Teebank Family | | 7,165,276 | | 40.7 |
| 1,753,796 | | 81.2 |
| 8,919,072 | | 45.1 | |
Limited Partnership (9) | |
| |
|
| | |
|
| | |
| |
601 West Market Street | |
| |
|
| | |
|
| | |
| |
Louisville, Kentucky 40202 | |
| |
|
| | |
|
| | |
| |
| |
| |
|
| | |
|
| | |
| |
Jaytee Properties | | 750,067 | | 4.3 |
| 168,066 | | 7.8 |
| 918,133 | | 4.6 | |
Limited Partnership (9) | |
| |
|
| | |
|
| | |
| |
601 West Market Street | |
| |
|
| | |
|
| | |
| |
Louisville, Kentucky 40202 | |
| |
|
| | |
|
| | |
| |
Directors, Nominees, and | |
| |
|
| | |
|
| | |
| |
Named Executive Officers: | |
| |
|
| | |
|
| | |
| |
| | | | | | | | | | | | | |
David P. Feaster | | 2,334 | (10) | * |
| — | | * |
| 2,334 | (10) | * | |
Jennifer N. Green | | — | (11) | * |
| — | | * |
| — | (11) | * | |
Heather V. Howell | | 375 | (12) | * |
| — | | * |
| 375 | (12) | * | |
Timothy S. Huval | | — | (13) | * |
| — | | * |
| — | (13) | * | |
Ernest W. Marshall, Jr. | | 179 | (14) | * |
| — | | * |
| 179 | (14) | * | |
W. Patrick Mulloy, II | | 16,636 | (15) | * |
| — | | * |
| 16,636 | (15) | * | |
George Nichols, III | | 496 | (16) | * |
| — | | * |
| 496 | (16) | * | |
W. Kennett Oyler, III | | 1,116 | (17) | * |
| — | | * |
| 1,116 | (17) | * | |
Vidya Ravichandran | | — | | * |
| — | | * |
| — | | * | |
Michael T. Rust | | 3,358 | (18) | * |
| — | | * |
| 3,358 | (18) | * | |
Susan Stout Tamme | | 12,590 | (19) | * |
| — | | * |
| 12,590 | (19) | * | |
Andrew Trager-Kusman | | 1,001 | (20) | * |
| — | | * |
| 1,001 | (20) | * | |
Mark A. Vogt | | 17,391 | (21) | * |
| — | | * |
| 17,391 | (21) | * | |
William R. Nelson | | 24,616 | (22) | * |
| — | | * |
| 24,616 | (22) | * | |
Logan M. Pichel | | 20,862 | (23) | * |
| — | | * |
| 20,862 | (23) | * | |
John T. Rippy | | 18,167 | (24) | * |
| — | | * |
| 18,167 | (24) | * | |
Kevin D. Sipes | | 78,231 | (25) | * |
| — | | * |
| 78,231 | (25) | * | |
A. Scott Trager | | 8,226,790 | (5) | 46.7 |
| 1,921,862 | (6) | 89.1 |
| 10,150,706 | (5)(6) | 51.4 | |
Steven E. Trager | | 8,399,127 | (1) | 47.7 |
| 1,940,091 | (2) | 89.8 |
| 10,339,218 | (1)(2) | 52.3 | |
Directors. Nominees and All | |
| |
|
| | |
|
| | |
| |
Executive Officers (25 persons): | | 9,025,920 | (26) | 51.3 | % | 1,942,145 | (26) | 89.9 | % | 10,968,065 | (26) | 55.5 | % |
*Represents less than 1% of total
4
| |
2023 PROXY STATEMENT | 11 |
| (1) | Includes 7,165,276 shares held of record by Teebank Family Limited Partnership |
| (2) | Includes 1,753,796 shares held of record by Teebank and 168,066 shares held of record by Jaytee. With respect to Teebank and Jaytee, Steven E. Trager is |
| (3) | Includes 7,165,276 shares held of record by Teebank and 750,067 shares held of record by Jaytee. With respect to Teebank and Jaytee, |
| (4) | Includes 1,753,796 shares held of record by Teebank and 168,066 shares held of record by Jaytee. With respect to Teebank and Jaytee, |
| (6) | Includes 1,753,796 shares held of record by Teebank and 168,066 shares held of record by Jaytee. A. Scott Trager is a limited partner of both Teebank and Jaytee. A. Scott Trager shares voting authority over shares held by both Teebank and Jaytee as a member of each partnership’s voting committee. Includes |
| (7) | Includes 7,165,276 shares held of record by Teebank and 750,067 shares held of record by Jaytee. Sheldon G. Gilman, as trustee of trusts, is a limited partner of both Teebank and Jaytee. Sheldon G. Gilman shares voting authority over shares held by both Teebank and Jaytee as a member of each partnership’s voting committee. Also includes 39,307 shares held by Sheldon G. Gilman’s spouse. |
| (8) | Includes 1,753,796 shares held of record by Teebank and 168,066 shares held of record by Jaytee. Sheldon G. Gilman, as trustee of trusts, is a limited partner of both Teebank and Jaytee. Sheldon G. Gilman shares voting authority of both Teebank and Jaytee as a member of each partnership’s voting committee. |
5
| (9) | Teebank and Jaytee are limited partnerships, the limited partners of which include A. Scott Trager, Andrew Trager-Kusman, and trusts for which each of Steven E. Trager and Sheldon G. Gilman serve as |
12 | Republic Bancorp, Inc. |
| provides information about the units of Teebank and Jaytee beneficially owned by Directors, Director Nominees, Executive Officers, and 5% shareholders of Republic: |
| | | | | | | | | | | | | | | | | | |
| | | | | | | | | | |
|
|
|
|
|
|
|
|
| | Number of | | Percent of Jaytee | | Number of | | Percent of Teebank | | | Number of | | Percent of Jaytee | | Number of | | Percent of Teebank |
|
Name |
| Jaytee Units |
| Units Outstanding |
| Teebank Units |
| Units Outstanding |
|
| Jaytee Units |
| Units Outstanding |
| Teebank Units |
| Units Outstanding |
|
Jean S. Trager | | 20,046 | (a) | 1.0 | % | 20,046 | (c) | 1.0 | % | |||||||||
Trager Trust of 2012 |
| 32,284 | (a) | 1.6 | % | 200,442 | (c) | 9.1 | % | |||||||||
Steven E. Trager | | 1,908,751 | (b) | 95.4 | % | 1,956,950 | (d) | 88.9 | % |
| 1,548,297 | (b) | 77.4 | % | 1,596,496 | (d) | 72.5 | % |
A. Scott Trager | | 5,293 | | * | % | 5,293 | | * | % |
| 5,293 | | * | % | 5,293 | | * | % |
Andrew Trager-Kusman | | 3,232 | | * | % | 54,920 | (e) | 2.5 | % |
| 28,978 | | 1.4 | % | 80,666 | (e) | 3.7 | % |
Sheldon G. Gilman, Trustee | | 44,050 | | 2.2 | % | 156,608 | | 7.1 | % |
| 44,050 | | 2.2 | % | 156,608 | | 7.1 | % |
| | | | | | | | | | |||||||||
*Represents less than 1% of total
|
|
| (a) | Includes 20,000 general partner units and |
| (b) | Includes 20,000 general partner units and 268,130 limited |
| (c) | Includes 20,000 general partner units and |
| (d) | Includes 20,001 general partner units and 36,905 limited |
| (e) | Includes 54,545 limited partner units held in an irrevocable trust for Andrew Trager-Kusman’s mother of which Andrew Trager-Kusman is co-trustee. |
| (10) |
| Does not include |
| (11) | Does not include |
| (12) | Does not include |
6
| (13) | Does not include |
| (14) | Does not include 3,944 shares issuable beyond 60 days of February 10, 2023 to Ernest W. Marshall, Jr. upon vesting in accordance with the terms of the Company’s Non-Employee Director and Key Employee Deferred Compensation Plan. |
| (15) | Includes 15,510 shares held jointly by W. Patrick Mulloy, II with his spouse. W. Patrick Mulloy, II shares investment and voting power over these shares. Does not include |
| |
2023 PROXY STATEMENT | 13 |
| (16) | Does not include |
| (17) | Does not include |
| (18) | Includes 2,045 shares held jointly by Michael T. Rust with his spouse. Michael T. Rust shares investment and voting power over these shares. Does not include |
| (19) | Does not include |
| (20) | Includes 1,000 shares for stock options held by Andrew Trager-Kusman that are exercisable within 60 days of February 10, 2023. Andrew Trager-Kusman owns Jaytee and Teebank limited partnership units, both individually and through various trusts, as disclosed in Footnote 9. |
| (21) | Includes 3,000 shares held jointly by Mark A. Vogt with his spouse. Mark A. Vogt shares investment and voting power over these shares. Also includes 10,000 shares held in a Delaware Trust. Does not include |
| Includes voting rights for 3,000 restricted shares that vest 50% in March 2023 and 50% in March 2024. Also includes voting rights for 1,333 restricted shares that vest in December |
| (23) | Includes |
7
| (24) | Includes |
| (25) | Includes 3,954 shares held by Kevin D. Sipes in Republic’s 401(k) Plan. Includes voting rights for 3,000 restricted shares that vest 50% in March 2023 and 50% in March 2024. Also includes voting rights for 1,333 restricted shares that vest in December 2023 and 667 restricted shares that vest in December 2024. Does not include 3,422 shares issuable beyond 60 days of February 10, 2023 to Kevin D. Sipes upon vesting in accordance with the terms of the Company’s Non-Employee Director and Key Employee Deferred Compensation Plan. |
| (26) | Includes the shares as described above held by the Directors, Director Nominees, and NEOs, along with an additional |
14 | Republic Bancorp, Inc. |
PROPOSAL ONE:
ELECTION OF DIRECTORS
Recommendation of Republic’s Board of Directors | The Board of Directors recommends that shareholders vote “FOR” all of the proposed Board of Director Nominees named in this proxy statement. |
Republic’s Board of Directors is comprised of one class of Directors that areis elected annually. Each Director serves a term of one (1) year until the 2022 Annual Meetingnext annual meeting and until his or her successor is duly elected or qualified. All of Republic’s current Directors were elected to a one (1) year term at the most recent Annual Meeting held on April 21, 2022.
Number of Directors
Republic’s Bylaws currently provide for not less than five (5) nor more than fifteen (15) Directors. As set forth below in Proposal Three, the Board of Directors is proposing that the shareholders approve an amendment to the Bylaws increasing the maximum number of directors to eighteen (18). Directors. In accordance with the Company’s current Bylaws, the Board of Directors has fixed the number of Directors to be elected at the 20212023 Annual Meeting at fifteen (15)sixteen (16).
| Mandatory | |
| | |
| 72 | |
| | |
Mandatory Retirement Age
The mandatory retirement age for a Director is seventy-two (72). At its November 2020 meeting, the Board of Directors amended the Bylaws to establish that a Director’s age for purposes of mandatory retirement is years old, determined as of December 31 of the year preceding the election. No Director will retire from the Company Board at this annual meeting due to the mandatory retirement age.
2023 Director Nominees
The Nominating Committee of the Board of Directors (the “Nominating Committee”) and the Board of Directors have nominated the following Director Nominees for election as Directors: Steven E. Trager, A. Scott Trager, Andrew Trager-Kusman, Ronald F. Barnes, Laura M. Douglas, election:
§ David P. Feaster § Jennifer N. Green § Heather V. Howell § Timothy S. Huval § Ernest W. Marshall, Jr. § W. Patrick Mulloy, II § George Nichols, III § W. Kennett Oyler, III | § Logan M. Pichel § Vidya Ravichandran § Michael T. Rust § Susan Stout Tamme § A. Scott Trager § Steven E. Trager § Andrew Trager-Kusman § Mark A. Vogt |
All Director Nominees, except for Vidya Ravichandran, are current members of the Board of Directors of the Company and the Bank. The 2023 Director Nominees would serve a one (1) year term until the Company’s 2024 annual meeting of shareholders. The Company would like to thank Craig A. Greenberg for his 16 years of service as a Director for the Company and the Bank. Mr. Greenberg resigned as a Director of the Company and Bank as of December 31, 2022
| |
2023 PROXY STATEMENT | 15 |
after being elected mayor of the City of Louisville. Mr. Greenberg served as a Director of the Bank from 2006 to 2008 and from 2020 to December 31, 2022 and as a Director of the Company from 2008 to December 31, 2022.
2023 Independent Director Nominees
Non-employee Director Nominees Jennifer N. Green, Heather V. Howell, Timothy S. Huval, Ernest W. Marshall, Jr., W. Patrick Mulloy, II, George Nichols, III, W. KennethKennett Oyler, III, Michael T. Rust, Susan Stout Tamme, and Mark A. Vogt. Each of the nominees is a current member of the Board of Directors of the Company and the Bank with the exception of George Nichols, III who is a member of the Board of Directors of only the Bank.
Non-employee Director Nominees Ronald F. Barnes, Laura M. Douglas, Craig A. Greenberg, Heather V. Howell, Ernest W. Marshall, Jr., W. Patrick Mulloy, II, George Nichols, III, W. Kenneth Oyler, III,Vidya Ravichandran, Michael T. Rust, Susan Stout Tamme, and Mark A. Vogt would collectively comprise a majority of the Board of Directors, and the Board has determined that each is an “independent director” as defined in Rule 5605(a)(2) of the NASDAQ listing standards.standards (“Independent Directors”). Director Nominee David P. Feaster, while a non-employee Director Nominee, recently retired from the Bank in 2019 and currently provides consulting services.services to the Bank. Accordingly, David P.Mr. Feaster is not identified as an “independent director.” While the Company is a “controlled company” as defined under the NASDAQ rules and thus is entitled to an exemption from the majority independence rule, the Company has not elected this exemption for its 20212023 election of directorsDirectors but reserves the right to claim this exemption in the future.
Director Nominee Availability
Neither the Nominating Committee nor the Board of Directors has reason to believe that any nominee for directorDirector will not be available for election or to serve following election. However, if any of the Director Nominees should become unavailable for election, and unless authority is withheld, the holders of the proxies solicited hereby will vote for such other individual(s) as the Nominating Committee or the Board of Directors may recommend.
Director Skills Matrix
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David P. Feaster |
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Jennifer N. Green |
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Michael T. Rust |
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16 | Republic Bancorp, Inc. |
NASDAQ Board Diversity Rules and Matrix
The SEC approved NASDAQ’s Board Diversity Rules which require companies listed on the NASDAQ Global Select Market to have, or to explain why they do not have, at least one diverse director (as defined in Nasdaq Rule 5605(f)(1)) by December 31, 2023 and at least two diverse directors (including at least one woman and at least one member of an underrepresented community) by December 31, 2025. Additionally, effective August 8, 2022, NASDAQ companies are required to disclose on an annual basis directors’ voluntary, self-identified demographic information using a standardized board diversity matrix (“Board Diversity Matrix”), which may be disclosed in the company’s proxy statement.
The Company already satisfies NASDAQ’s Board Diversity Rule requirement having at least two diverse directors. In further compliance with the NASDAQ Board Diversity Rule, the Board Diversity Matrix below provides the self-identified demographic information for the Company’s Director Nominees as of January 8, 2023. Each of the categories listed in the table below has the meaning as it is used in Nasdaq Rule 5605(f).
Board Diversity Matrix
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Total Number of Directors | 16 | | | | | | | |
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2023 PROXY STATEMENT | 17 |
Director Nominees’ Names and Principal Occupations for the Past Five Years
The following table details the indicated information for each Director Nominee, and incumbent Director, including service as a directorDirector of the Company or its predecessors:
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Director Nominees: | | Director | ||
Name and Principal Occupation for Past Five Years | Age | Since | ||
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Steven E. Trager began serving as both Chairman and CEO of Republic in 2012. He previously served as President and CEO of Republic since 1998. He also currently serves as Chairman and CEO of the Bank. Mr. Trager began his career with the Bank in 1988 as General Counsel. | 60 | 1988 | ||
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Mr. Trager received his undergraduate degree in finance at the University of Texas at Austin. He received his Juris Doctor degree from the University of Louisville Brandeis School of Law and engaged in the practice of law with the firm of Wyatt, Tarrant & Combs. He has more than thirty years banking experience. In 1994, he provided the leadership resulting in the complex merger and reorganization of the Republic group of multiple banks into a consolidated and more efficient banking structure. He provided the leadership for the Company’s initial public offering. He has direct experience not only in banking, but also in finance, operations, and retail management. He also has leadership and directorate experience in multiple community service organizations. Mr. Trager is past chairman for the Kentucky Bankers Association, the University of Louisville Board of Overseers, the 2016 Fund for the Arts Campaign and Leadership Kentucky, and is a former board member of the Federal Reserve Bank of St. Louis’ Louisville Branch and the Louisville Regional Airport Authority. Mr. Trager currently serves on the Bellarmine University Board of Trustees. Mr. Trager’s past recognition includes the Louisvillian of the Year in 2017, the Lincoln Foundation’s 2018 Spirit of Excellence Award, the Juvenile Diabetes Research Foundation’s Man of the Year in 2003, and recipient of the 2003 Ernst & Young Entrepreneur of the Year Award for the Southern Ohio and Kentucky region. Based on Mr. Trager's experience as a Bank Board Director, his direct banking experience, his proven leadership skills, his education and legal background, his extensive community involvement, his vested interest in the long-term success of Republic as a material equity owner, and his specific experience, qualifications and attributes herein disclosed, the Board has determined that he should continue to serve as a Director. | | | ||
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A. Scott Trager has served as President of Republic since 2012 and was appointed Vice Chairman of Republic in 2017. He previously served as Vice Chairman of Republic from 1994 to 2012. He has served as Vice Chairman of the Bank since 2017. | 68 | 1990 | ||
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Mr. Trager holds a degree in Business Administration from the University of Tennessee and has spent his entire working career in various finance and banking capacities. He has extensive leadership experience in marketing, operations, and retail branch management. He has extensive community board experience and broad-based community connections in the metropolitan Louisville area. Based on Mr. Trager's experience as a Bank Board Director, his direct banking experience, his proven leadership skills, his educational background, his extensive community involvement and his specific experience, qualifications and attributes herein disclosed, the Board has determined that he should continue to serve as a Director. | | | ||
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Andrew Trager-Kusman has served as Vice President, Managing Director of Corporate Strategies of the Bank since 2016, primarily overseeing strategic initiatives, a new profitability model, and reviewing potential acquisition opportunities. He has served as a Director of Republic since 2019 and a Director of the Bank since 2020. | 34 | 2019 | ||
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Mr. Trager-Kusman received his undergraduate degree in Finance from Indiana University. From 2012-2015, Mr. Trager-Kusman served as Portfolio Analyst with EJF Capital LLC, an alternative asset manager primarily focused on United States and global financial institutions. In his role at EJF Capital LLC, Mr. Trager-Kusman focused on TARP investments and small bank private equity funds, recapitalizations of struggling institutions, and placement of capital for growth in well-performing banks. He routinely spoke with company management and boards regarding regulatory issues and long-term strategies. Previously, he worked in the U.S. House of Representatives. Mr. Trager-Kusman serves as a trustee for Spalding University, on the JTomorrow Louisville Board, and was part of the Leadership Louisville Bingham Fellows class of 2019. Based on Mr. Trager-Kusman’s experience with the Bank and other entities, experience as a Bank Board Director, his leadership ability, and his specific experience, qualifications, and attributes herein disclosed, the Board has determined that he should continue to serve as a Director. | | | ||
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Ronald F. Barnes is Partner Emeritus with MCM CPA’s & Advisors, LLP. He was a partner with McCauley, Nicolas & Company LLC from 1980-1990 and then managing partner from 1990-2012 until it merged with MCM CPA’s & Advisors, LLP in 2013. He continued as a partner and on the firm’s Executive Committee until he became Partner Emeritus in 2015. He currently works with Meritrust Wealth Management, LLC, an investment group affiliated with MCM. Mr. Barnes is a Certified Public Accountant. Mr. Barnes has served as a Director of the Bank since 2007 and a Director of Republic since 2020. | 71 | 2020 | ||
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Mr. Barnes earned a Bachelor of Science at Indiana University Southeast. He received his CPA certificate in Indiana in 1975 and in Kentucky in 1993. Mr. Barnes is also credentialed by the AICPA as a Personal Financial Specialist (PFS) and is designated as a Chartered Global Management Accountant (CGMA). Mr. Barnes also served 32 years in the military and rose to the rank of Colonel in the Army Reserves where he has also served as Ambassador as appointed by the Chief of the Army Reserves, Washington, D.C. He has held membership in numerous professional, business, civic and social organizations, including directorships on the boards of the YMCA, Madison Chamber of Commerce, Bridgepoint Goodwill Industries, Community Foundation of Southern Indiana, Leadership Southern Indiana, Boy Scouts of America (Lincoln Heritage Council), and the Venture Club of Louisville. Mr. Barnes has been awarded the Chancellor’s Medallion by the Chancellor at Indiana University Southeast. Based on Mr. Barnes’ experience as a Bank Board Director, his accounting background, his certification as a Certified Public Accountant, his leadership and directorate experience, and his specific experience, qualifications and attributes herein disclosed, the Board has determined that he should continue to serve as a Director. | | | ||
DAVID P. FEASTER | | jennifer n. green | ||
COMMITTEE: Loan Age: 69 Director of Republic since 2020 and Director of the Bank since 2019 Consultant, Republic Bank & Trust Company |
| COMMITTEE: Enterprise Risk and Community Reinvestment Act Age: 38 Director of Republic and Director of the Bank since 2022 |
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KEY EXPERIENCE AND QUALIFICATIONS ● Retired, consultant to the Bank since 2019. ● Previously, having forty-seven years of banking experience, Florida Market President for the Bank (2016-2019); CEO, President, and Director of Cornerstone Community Bank (2009 – 2016, when Cornerstone merged with the Bank); founder, CEO, and President of Signature Bank in St. Petersburg, Florida (which merged into Whitney National Bank); Area President of Whitney National Bank after merger; an executive at a number of banks in Florida, including Sun Bank, Bank of America, C&S, and Northern Trust Bank. ● Member of the Florida Bankers Association Board, former chair of the St. Petersburg Area Chamber of Commerce, former chair of All Children’s Hospital Board, and a member of the St. Petersburg College Banking School Board. EDUCATION ● University of Florida, Business Administration, with honors REASON FOR NOMINATION Based on Mr. Feaster’s experience as a Republic and Bank Board Director, his extensive banking experience, his significant community involvement, and his specific experience, qualifications, and attributes disclosed, the Board has determined that he should continue to serve as a Director. | | KEY EXPERIENCE AND QUALIFICATIONS ● Vice President, Global Mergers & Acquisitions for YUM! Brands, a global restaurant company that owns and operates the KFC, Pizza Hut, Taco Bell, and The Habit Burger Grill brands, since 2020. ● Previously YUM! Brands’ Director of Transformation & Chief of Staff (2020-2021) and Director, Corporate Counsel (2016-2020); Vice President and Counsel, Corporate Secretary Americas for Credit Suisse (2014-2016); and attorney with Davis Polk & Wardwell LLP (2012 - 2014), with practice areas including Capital Markets, Mergers & Acquisitions, and Derivatives and Structured Products. ● Member of the City of Louisville’s Civilian Review & Accountability Board (Board’s inaugural Chair) and the Greater Louisville Inc. Business Council to End Racism, and former board member for Stage One Family Theatre and Maryhurst. ● Member of the New York Bar Association, the Kentucky Bar Association, the Charles W. Anderson, Jr. Chapter of the National Bar Association, and the Brandeis Inn of Court. EDUCATION ● Columbia Law School, Juris Doctor; Harlan Fiske Stone Scholar and Articles Editor of the Columbia Law Review ● Harvard University, Bachelor of Arts in Government, and a French Language Citation HONORS AND RECOGNITION ● 2021 On Deck Fellow ● 2019 Leadership Council on Legal Diversity Fellow ● 2017 graduate of Ignite Louisville REASON FOR NOMINATION Based on Ms. Green’s experience as a Republic and Bank Board Director, her managerial and business background, her educational and legal background, and her specific experience, qualifications, and attributes disclosed, the Board has determined that she should continue to serve as a Director. | ||
18 | Republic Bancorp, Inc. |
HEATHER V. HOWELL | | timothy s. huval | ||
COMMITTEE: Nominating Age: 49 Director of Republic since 2020 and Director of the Bank since 2015 |
| COMMITTEE: Audit Age: 56 Director of Republic and Director of the Bank since 2022 |
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KEY EXPERIENCE AND QUALIFICATIONS ● Director of Global Innovation and Trademark Development for the Jack Daniel’s Family of Brands, having been employed by Brown-Forman Corporation since 2015. ● Previously CEO and Chief Tea Officer (2010-2015) of Rooibee Red Tea, launching Rooibee Roo in 2014, a line of ready-to-drink tea with less calories and sugar for children, a brand extension for Rooibee Red Tea. ● Member of the Greater Louisville Project Board of Directors. EDUCATION ● Bellarmine University, Executive MBA ● Eastern Kentucky University, Bachelor of Arts HONORS AND RECOGNITION ● 2013 Ernst & Young E.D.G.E. Award ● 2014 Business First Enterprising Woman to Watch ● Finalist in 2013 Business First Business Leader of the Year REASON FOR NOMINATION Based on Ms. Howell’s experience as a Republic and Bank Board Director, her education, her business and entrepreneurial experience, and her specific experience, qualifications, and attributes disclosed, the Board has determined that she should continue to serve as a Director. | | KEY EXPERIENCE AND QUALIFICATIONS ● Chief Administrative Officer (2019 - Present) and Chief Human Resources Officer (2013 - Present) of Humana, Inc. ● Previously held a number of positions at Bank of America (2002-2013), including Human Resources Executive, Global Treasury Services/Technology Division; Senior Human Resources Executive, Global Wealth & Investment Management; Chief Information Officer, Global Wealth & Investment Management; Head of Operations, Credit Card Services; Head of Operations, Mortgage Business; and Senior Vice President, Consumer Service & Operations, and served in various roles at Gateway Computers (1997-2002), including Training and Development Manager, Global Operations; Sr. Manager, Human Resources; General Manager, Factory & Call Center; and Director, Human Resources, Global Operations & Consumer. ● Advisory board member for MyCareGorithm, LLC. ● Former member of the NASDAQ-listed Seacoast Banking Corporation board of directors (2016 - 2019). EDUCATION ● Brigham Young University, Master’s in Public Administration ● Weber State University, Bachelor of Arts, Marketing ● Salt Lake City Community College, Associate’s Degree; Honorary Doctor of Humane Letters REASON FOR NOMINATION As a member of the Audit Committee, Mr. Huval can read and understand basic financial statements, such as a balance sheet, income statement, and cash flow statement. Based on Mr. Huval’s experience as a Republic and Bank Board Director, his financial experience, his managerial and banking background, his business and educational background, and his specific experience, qualifications, and attributes disclosed, the Board has determined that he should continue to serve as a Director. | ||
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2023 PROXY STATEMENT | 19 |
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Director Nominees: | | Director |
Name and Principal Occupation for Past Five Years (continued) | Age | Since |
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Laura M. Douglas was employed for 14 years by LG&E and KU Energy LLC and retired as of January 2017. She previously served as Vice President of Corporate Responsibility & Community Affairs of LG&E and KU Energy LLC and as Director of Communications at LG&E. She was appointed as interim co-executive director of Transit Authority of River City in 2020. Ms. Douglas has served as a Director of the Bank since 2004 and a Director of Republic since 2020. | 71 | 2020 |
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Ms. Douglas earned a Bachelor of Arts degree in Political Science from the University of Louisville and a Juris Doctor degree from the University of Louisville Brandeis School of Law. Prior to her employment with LG&E, she held various positions as legal counsel to the Louisville Metropolitan Sewer District and General Counsel and Secretary for the Louisville Water Company. She also held the position of Secretary of the Public Protection and Regulation Cabinet of the Commonwealth of Kentucky for several years. She has served many professional organizations including the Kentucky Bar Association, the American Bar Association, the American Bar Foundation, the Jefferson County Women Lawyers Association, the Law Alumni Council for the Brandeis School of Law, and the Rotary Club of Louisville. Ms. Douglas also serves or has served on numerous boards and commissions, including serving as Chair of the Board of Directors for the Muhammad Ali Center, Chair of the Citizens Commission on Police Accountability, and the Kentucky State University Board of Regents. Based on Ms. Douglas’ experience as a Bank Board Director, her education and legal experience, her professional affiliations and community and civic involvement and her specific experience, qualifications and attributes herein disclosed, the Board has determined that she should continue to serve as a Director. | | |
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David P. Feaster is retired and was previously employed by the Bank serving as its Florida Market President from 2016-2019. Prior to that, Mr. Feaster was the CEO, President and Director of Cornerstone Community Bank beginning in January 2009 until Cornerstone merged with Republic Bank. Since 2019, Mr. Feaster has served as a consultant to the Bank. He has served as a Director of the Bank since 2019 and a Director of Republic since 2020. | 67 | 2020 |
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Mr. Feaster has 43 years of banking experience and was a founder, CEO, and President of Signature Bank in St. Petersburg, Florida which was purchased and eventually merged into Whitney National Bank. Mr. Feaster became Area President of Whitney National Bank after the merger. Prior to his association with Signature Bank, Mr. Feaster was an Executive at several banks in Florida including Sun Bank, Bank of America, C&S and he helped open Northern Trust Bank in the Tampa Bay area serving in a Regional Executive capacity. He has been very active in civic affairs. He serves on the board of the Florida Bankers Association, was Chair of the St. Petersburg Area Chamber of Commerce, Chair of the All Children’s Hospital Board, and a member of the St. Petersburg College Banking School Board. Mr. Feaster graduated with honors from the University of Florida with a degree in Business Administration. Based on Mr. Feaster’s experience as a Bank Board director, his extensive banking experience, his significant community involvement and his specific experience, qualifications and attributes herein disclosed, the Board has determined that he should continue to serve as a Director. | | |
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Craig A. Greenberg is currently Managing Member of the Greenberg Group, a consulting and investment firm. Until July 2020, he served as President & CEO of 21c Museum Hotels. Mr. Greenberg served in various roles with 21c since its founding in 2007. Mr. Greenberg also served as Counsel with the general legal services law firm of Frost Brown Todd LLC in Louisville, Kentucky until 2017. He has served as a Director of the Bank from 2006 to 2008 and from 2020 until present and has served as a Director of Republic from 2008 to present. | 47 | 2008 |
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Mr. Greenberg is a graduate of the University of Michigan, where he served as Student Government President. He is a Harvard Law School cum laude graduate. He has extensive experience in securing and deploying federal, state, and local tax credits and other incentives in connection with the development of urban revitalization projects across the country. He has direct experience in commercial finance, capital raising, transaction structuring, and the leadership of multi-million-dollar developments. He is active in local civic and charitable organizations. Based on Mr. Greenberg’s experience as a Bank Board Director, his commercial finance and development knowledge, his educational background, including legal knowledge and skills, his extensive community involvement and his specific experience, qualifications and attributes herein disclosed, the Board has determined that he should continue to serve as a Director. | | |
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Heather V. Howell has been employed by Brown-Forman Corporation since May 2015 and is currently the Director of Global Innovation and Trademark Development for the Jack Daniel’s Family of Brands. She was Chief Tea Officer of Rooibee Red Tea from June 2010 to May 2015. She has served as a Director of the Bank since 2015 and a Director of Republic since 2020. | 47 | 2020 |
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Ms. Howell is a graduate of Eastern Kentucky University and received her Executive MBA from Bellarmine University. Ms. Howell previously served as CEO for Rooibee Red Tea. In 2014, Ms. Howell helped launch Rooibee Roo, a line of ready-to-drink tea with less calories and sugar for children, which was the first brand extension for Rooibee Red Tea. She has been recognized numerous times on a local, regional, and national scale including the 2013 Ernst & Young E.D.G.E. award as an emerging entrepreneur. In addition, Business First of Louisville honored Ms. Howell with the 2014 Enterprising Woman to Watch award and named her a finalist in 2013 for the Business Leader of the Year award. In addition, Ms. Howell serves on the Greater Louisville Project Board of Directors. Based on Ms. Howell’s experience as a Bank Board Director, her education, her business and entrepreneurial experience, and her specific experience, qualifications and attributes herein disclosed, the Board has determined that she should continue to serve as a Director. | | |
eRNEST W. MARSHALL, JR. | | W. PATRICK MULLOY, II | ||
COMMITTEES: Compensation - Chair Nominating Age: 54 Director of Republic since 2020 and Director of the Bank since 2017 |
| COMMITTEES: Enterprise Risk and Community Reinvestment Act Loan Age: 69 Director of Republic since 2020 and Director of the Bank since 2012 |
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KEY EXPERIENCE AND QUALIFICATIONS ● Executive Vice President and Chief Human Resources Officer at Eaton Corporation since 2018. ● Vice President of Human Resources of GE Aviation at the General Electric Company (2013-2018). ● Trustee for Bellarmine University and board member for Kindway and the Rock and Roll Hall of Fame. ● Director for the NASDAQ-listed LSI Industries Inc. since August 16, 2022. EDUCATION ● Indiana University, Bloomington, MBA/Juris Doctor ● Bellarmine University, Bachelor’s degree with a dual major in Accounting and Business Administration; including two semesters abroad at New College in Oxford, England HONORS AND RECOGNITION ● One of 2020’s Most Influential Black Executives in Corporate America, Savoy Magazine ● ’50 under 50’ feature, Black MBA Magazine ● ‘Top 40 under 40’ feature, Network Journal REASON FOR NOMINATION Based on Mr. Marshall’s experience as a Republic and Bank Board Director, his business experience and accomplishments, his extensive civic and community involvement, and his specific experience, qualifications, and attributes disclosed, the Board has determined that he should continue to serve as a Director. | | KEY EXPERIENCE AND QUALIFICATIONS ● Of Counsel with the law firm of Wyatt, Tarrant & Combs, LLP since 2022. ● Previously Director and CEO of Sharps Compliance, Inc. (April 2022 – September 2022); Of Counsel with Wyatt, Tarrant & Combs, LLP (2018-2022); Chairman and CEO of Elmcroft Senior Living (2006-2018), a national provider of senior housing services; and President and CEO of two other senior housing companies, LifeTrust America, Inc., and Atria, Inc.; an attorney with the regional law firm of Greenebaum, Doll & McDonald PLLC (1994-1996); the Secretary of Finance to the Governor of Kentucky (1992-1994); and an attorney at a Louisville law firm (1978 - 1992). ● Investor and director of Assembly Healthcare, an ancillary service provider to healthcare providers. ● Member of Advisory Board of Apploi, Inc., the Board of Advisors of Vanderbilt University School of Law, and the Board Chair of University of Louisville Health, Inc. ● Director for the NASDAQ-listed Sharps Compliance Corp. from February 1, 2021 – September 2022. EDUCATION ● Vanderbilt University School of Law, Juris Doctor ● Vanderbilt University, Bachelor of Arts, interdisciplinary major in History, Economics, Philosophy, summa cum laude REASON FOR NOMINATION Based on Mr. Mulloy’s experience as a Republic and Bank Board Director, his managerial and business background, his educational and legal background, and his specific experience, qualifications, and attributes disclosed, the Board has determined that he should continue to serve as a Director. | ||
10
20 | Republic Bancorp, Inc. |
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Director Nominees: | | Director |
Name and Principal Occupation for Past Five Years (continued) | Age | Since |
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Ernest W. Marshall, Jr. has been employed as an Executive Vice President and Chief Human Resources Officer at Eaton Corporation located in Cleveland, Ohio since July 2018. He was Vice President of Human Resources of GE Aviation at the General Electric Company (“GE”) from August 2013 to April 2018. Mr. Marshall has served as a Director of the Bank since 2017 and a Director of Republic since 2020. | 52 | 2020 |
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Mr. Marshall earned a Bachelor’s degree with a dual major in Accounting and Business Administration from Bellarmine University in Louisville, Kentucky. During his tenure at Bellarmine, he spent two semesters abroad at New College in Oxford, England. He also earned his MBA/J.D. from Indiana University – Bloomington. Prior to his current position at Eaton Corporation, he was employed by GE and its affiliates and divisions in various capacities. Mr. Marshall has been active in Louisville and surrounding communities. He serves on the boards of directors of Bellarmine University, Kindway, and the Rock and Roll Hall of Fame. He was selected by Savoy Magazine as one of 2020’s Most Influential Black Executives in Corporate America, Black MBA magazine in its ’50 under 50’ feature and by Network Journal in its ‘Top 40 under 40’ feature. Based on Mr. Marshall’s experience as a Bank Board Director, his business experience and accomplishments, his extensive civic and community involvement and his specific experience, qualifications and attributes herein disclosed, the Board has determined that he should continue to serve as a Director. | | |
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W. Patrick Mulloy, II has been Of Counsel with the law firm of Wyatt, Tarrant & Combs since 2018. He is also the Managing Member of Commodore Capital LLC. From 2006 to 2018, he served as Chairman and CEO of Elmcroft Senior Living, a national provider of senior housing services, headquartered in Louisville, Kentucky. He has served as a Director of the Bank since 2012 and a Director of Republic since 2020. | 67 | 2020 |
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Mr. Mulloy graduated summa cum laude from Vanderbilt University with a Bachelor of Arts degree and an interdisciplinary major in history, economics and philosophy. He received his Juris Doctor degree from the Vanderbilt University School of Law and engaged in the practice of law in a Louisville based law firm from 1978-1992 and again in 1994-1996 in the regional law firm of Greenebaum, Doll & McDonald. From 1992-1994, he served as the Secretary of Finance to the Governor of Kentucky. Prior to his position as CEO of Elmcroft Senior Living, Mr. Mulloy also served as President and CEO of two other senior housing companies, LifeTrust America, Inc, based in Nashville, Tennessee and Atria, Inc. in Louisville, Kentucky. In 2021, Mr. Mulloy became a director for Sharps Compliance Corp., a full-service national provider of comprehensive waste management solutions, including medical, pharmaceutical, and hazardous. Mr. Mulloy is an investor and director of Assembly Healthcare, an ancillary service provider to the senior care industry. Mr. Mulloy also serves as a member of the Board of Trustees of Bellarmine University, a member of the Board of Advisors of Vanderbilt University School of Law, and is the Vice Chair of University of Louisville Health, Inc. Based on Mr. Mulloy’s experience as a Bank Board Director, his managerial and business background, his educational and legal background and his specific experience, qualifications and attributes herein disclosed, the Board has determined that he should continue to serve as a Director. | | |
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George Nichols III has been the President and Chief Executive Officer of The American College of Financial Services since November 2018. From 2001-2018, he served in various roles with New York Life Insurance Company including his last role as Executive Vice President, Office of Governmental Affairs and Executive Leadership Program, and was the Commissioner of the Kentucky Department of Insurance from 1996 to 2000. He began serving as a Director of the Bank in 2020. | 60 | N/A |
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Mr. Nichols received a Bachelor of Arts in Sociology and Economics from Western Kentucky University and a Master of Arts in Labor Studies from the University of Louisville. While with New York Life he served in the roles of Senior Vice President for Government Affairs, AARP Operations, and Assistant to the CEO & Chairman. Prior to his service as Kentucky Insurance Commissioner he was the Executive Director of the Kentucky Health Policy Board and from 1992-1995 worked for Southeastern Group (Blue Cross/Blue Shield of Kentucky) in Marketing and Product Development. Mr. Nichols serves on the Boards of The American College of Financial Services and its Foundation Board, Western Kentucky University, City Year (a national service program uniting young adults for a year of community service), and the U.S. Chamber of Commerce, and is a member of the National Association of Corporate Directors. He previously served as the President of the National Association of Insurance Commissioners and was recognized as one of the Top 100 Most Influential Blacks in Corporate America by Savoy Magazine in 2012 and 2018. Based on Mr. Nichols’ experience in the financial services sector, his experience as a Bank Board Director, his managerial, business and governmental background, his educational and professional background and his specific experience, qualifications and attributes herein disclosed, the Board has determined that he should serve as a Director. | | |
GEORGE NICHOLS III | | W. KENNETT OYLER, III | ||
COMMITTEES: Enterprise Risk and Community Reinvestment Act – Chair Compensation Age: 62 Director of Republic since 2021 and Director of the Bank since 2020 |
| COMMITTEE: Enterprise Risk and Community Reinvestment Act Age: 64 Director of Republic since 2020 and Director of the Bank since 2008 |
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KEY EXPERIENCE AND QUALIFICATIONS ● President and Chief Executive Officer of The American College of Financial Services since 2018. ● Previously held various roles with New York Life Insurance Company (2001-2018), including his last role as Executive Vice President, Office of Governmental Affairs and Executive Leadership Program; Commissioner of the Kentucky Department of Insurance (1996-2000); served as the Executive Director of the Kentucky Health Policy Board; and worked for Southeastern Group (Blue Cross/Blue Shield of Kentucky) in Marketing and Product Development (1992-1995). ● Member of the Board of The American College of Financial Services, Western Kentucky University, City Year Board Chair (a national service program uniting young adults for a year of community service), the Main Line Health Systems Board of Trustees, and the National Association of Corporate Directors; and a former member of the U.S. Chamber of Commerce and President of the National Association of Insurance Commissioners. ● Director for the NYSE-listed Reinsurance Group of America (RGA) since January 2022. EDUCATION ● University of Louisville, Master of Arts in Labor Studies ● Western Kentucky University, Bachelor of Arts, Sociology, Economics HONORS AND RECOGNITION ● Named as one of the top Black Corporate Directors in America, Savoy Magazine, 2021 ● Top 100 Most Influential Blacks in Corporate America, Savoy Magazine, 2012 and 2018. ● Named one of 50 Cultural Champions, Forbes Magazine, 2021 ● Business Insurance Magazine and Atlanta Life Insurance Company Alonzo Herndon award winner for leadership, 2021 REASON FOR NOMINATION Based on Mr. Nichols’ experience in the financial services sector, his experience as a Republic and Bank Board Director, his managerial, business, and governmental background, his educational and professional background, and his specific experience, qualifications, and attributes disclosed, the Board has determined that he should continue to serve as a Director. | | KEY EXPERIENCE AND QUALIFICATIONS ● CEO of OPM Services, Inc., a financial-services and investment firm Mr. Oyler founded in 1992. ● Previously President and CEO of Greater Louisville, Inc., the Louisville, Kentucky Metro Chamber of Commerce (2014 - 2020); Managing Partner of OPM (1992 - 2015); Cash Management Officer of Citizens Fidelity (now PNC) Bank; President, CEO, CSO of High Speed Access Corp., and Treasurer, VP of Finance and CFO of Henry Vogt Machine Co. ● Founded or co-founded twenty businesses in various industries, including financial services, real estate, internet access, manufacturing, railway, equipment leasing, and consumer research, and in 1997, co-founded a broadband internet provider, High Speed Access Corp., which he took public in 1999. ● Experience in leadership roles and directorships, including sixteen roles as chair, with dozens of civic and community organizations, including Leadership Louisville, Metro YMCA, University of Louisville, Metro United Way, Kentuckiana Works, the Metro Police Foundation, GLI, Canopy, Louisville Ballet, Junior Achievement, Louisville Science Center, and Downtown Development Corp. ● Serves as Director for Alliance Cost Containment, LLC and Thornton Capital. EDUCATION ● University of Louisville, Master of Business Administration ● University of Louisville, Bachelor of Science, Commerce, Marketing HONORS AND RECOGNITION ● Inducted into Kentucky Entrepreneur Hall of Fame, 2016 ● E&Y Entrepreneur of the Year, 2000 ● Cashflow Magazine Treasurer of the Year, 1985 REASON FOR NOMINATION Based on Mr. Oyler’s experience as a Republic and Bank Board Director, his education, his entrepreneurial and business background, his significant civic and community involvement, and his specific experience, qualifications, and attributes disclosed, the Board has determined that he should continue to serve as a Director. | ||
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2023 PROXY STATEMENT | 21 |
LOGAN M. PICHEL | | VIDYA RAVICHANDRAN | ||
COMMITTEE: Enterprise Risk and Community Reinvestment Act Age: 58 Director of Republic and Director of the Bank since 2021 President & CEO of Republic Bank & Trust Company |
| COMMITTEE: N/A Age: 50 Director Since: N/A (new 2023 nominee to both Company and Bank boards of directors) |
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KEY EXPERIENCE AND QUALIFICATIONS ● President and CEO of the Bank since 2021. ● Previously, having over 30 years of banking and financial services experience, served as President for the Bank (2020-2021) and held various positions with Regions Bank (2005-2020), including, Executive Vice President and Head of Corporate Development – Financial Planning and Analysis and Mergers and Acquisitions (2019-2020) (responsible for company budgeting, forecasting, capital allocation, business and product profitability analytics and reporting and bank and non-bank mergers and acquisitions), Head of Consumer Lending (2010-2018) (mortgage, home equity, auto and personal loans as well as fintech and small dollar lending), Head of Enterprise Operations (2018-2019) (bank operations, loan fulfillment and servicing, collections, and contact centers), and National Production Manager for Mortgage (2005-2010). ● Leader of Regions Bank’s Simplify and Grow initiative (2018-2020), which focused on making banking easier for customers, improving efficiencies of internal processes, and accelerating revenue growth. EDUCATION ● University of Michigan, Master of Business Administration ● Ohio Northern University, Finance REASON FOR NOMINATION Based on Mr. Pichel's banking experience, his experience as a Republic and Bank Board Director, his proven leadership skills, his education and background, and his specific experience, qualifications, and attributes disclosed, the Board has determined that he should continue to serve as a Director. | | KEY EXPERIENCE AND QUALIFICATIONS ● CEO and founder of GlowTouch, a global enterprise that provides customer care and technology outsourcing services, headquartered in Louisville, KY, with more than 3,000 employees throughout the United States, India, Philippines, and the Dominican Republic, since 2002. ● Founded StemWizard (2013), a software platform that allows students, teachers, judges, volunteers, and administrators to set up and run STEM competitions, such as science fairs, the Science Olympiad, and robotics events, through a cloud-enabled platform. ● Member of the Kentucky Council for Postsecondary Education Board, Young Presidents’ Organization, and C200. EDUCATION ● Virginia Polytechnic Institute and State University, Master of Science ● University of Agricultural Sciences, Bangalore, Bachelor of Science HONORS AND RECOGNITION ● Inductee of CCWomen Hall of Fame ● Louisville’s Most Admired CEOs, Business First REASON FOR NOMINATION Based on Ms. Ravichandran’s background in technology, her leadership and entrepreneurial achievements, her educational background, and her specific experience, qualifications, and attributes disclosed, the Board has determined that she should be nominated to serve as a Director. | ||
11
22 | Republic Bancorp, Inc. |
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Director Nominees: | | Director |
Name and Principal Occupation for Past Five Years (continued) | Age | Since |
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W. Kenneth Oyler, III currently serves as CEO of OPM Services, Inc., a financial-services and investment firm he founded in 1992 and is an executive in residence for the University of Louisville School of Business. Previously, he was Managing Partner of OPM from 1992 to 2015 and President and CEO of Greater Louisville, Inc. (“GLI”), the Louisville, Kentucky Metro Chamber of Commerce from 2014 to 2020. He serves as Director for Alliance Cost Containment, LLC and Simpak International, LLC. He has served as a Director of the Bank since 2008 and a Director of Republic since 2020. | 62 | 2020 |
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Mr. Oyler received a Bachelor of Science in Commerce (Marketing) and a Master of Business Administration (MBA) from the University of Louisville. Prior to his position at GLI, he served as CEO of OPM Services, Inc. He also served as the Cash Management Officer of Citizens Fidelity (now PNC) Bank and as Treasurer, VP of Finance and CFO of Henry Vogt Machine Co. Mr. Oyler has founded or co-founded twenty businesses in various industries including financial services, real estate, internet access, manufacturing, railway, equipment leasing and consumer research. In 1997, Mr. Oyler co-founded broadband internet provider, High Speed Access Corp. which he took public in 1999. In 2016, he was inducted into the Kentucky Entrepreneur Hall of Fame. Mr. Oyler has extensive experience in leadership roles and directorships, including sixteen chairmanships, with dozens of civic and community organizations, including Leadership Louisville, Metro YMCA, University of Louisville, Metro United Way, Kentuckiana Works, the Metro Police Foundation, and Downtown Development Corp. Based on Mr. Oyler’s experience as a Bank Board Director, his education, his entrepreneurial and business background, his significant civic and community involvement, and his specific experience, qualifications and attributes herein disclosed, the Board has determined that he should continue to serve as a Director. | | |
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Michael T. Rust previously served as President of Kentucky Hospital Association (“KHA”), located in Louisville, Kentucky, from 1996 to 2019. He has served as a Director of the Bank from 2001 to 2007 and 2020 to present and has served as a Director of Republic from 2007 to present. | 69 | 2007 |
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Mr. Rust graduated from Glenville State College in West Virginia where he received his undergraduate degree in Business Administration. He received a Master’s degree in Public Health from the University of Tennessee. He serves as a Community Based Faculty Member at the University of Kentucky. In his role as President of the KHA, he has extensive management and regulatory experience. He also has extensive advocacy experience in Washington, D.C. and Frankfort, Kentucky. He is a proven recruiter and organizer and has significant community involvement experience. He has leadership and directorate experience in multiple community service organizations. As a member of the Audit Committee, he can read and understand basic financial statements, such as a balance sheet, income statement, and cash flow statement. Based on Mr. Rust's experience as a Bank Board Director, his managerial and regulatory compliance background, his business and educational background, his extensive community involvement, including governmental affairs and his specific experience, qualifications and attributes herein disclosed, the Board has determined that he should continue to serve as a Director. | | |
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Susan Stout Tamme was employed by Baptist Healthcare System, Inc. and is retired as of April 2014. In July of 2013, she was appointed as President of Baptist Health Collaborations. She was formerly in the position of President of the Louisville Market from 2011 to 2013 and she was President and CEO of Baptist Hospital East from 1995 to 2011 and Vice President of Baptist Healthcare System, Inc. She has served as a Director of the Bank from 1999 to 2003 and 2020 to present and has served as a Director of Republic from 2003 to present. | 69 | 2003 |
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Ms. Tamme received an Associate degree in nursing from Eastern Kentucky University, a Bachelor of Science degree in nursing from the University of Louisville, and a Master of Science degree in Health Systems Administration, also from the University of Louisville. She has extensive experience in administration, specifically in broad-based multi-hospital systems and is proficient in working with department heads, clinical staff, and governing regulatory bodies. She has leadership and directorate experience in multiple community service organizations and has received multiple community service awards for excellence and achievement. Based on Ms. Tamme’s experience as a Bank Board Director, her managerial and administrative background, regulatory compliance experience, her extensive community involvement, and her specific experience, qualifications and attributes herein disclosed, the Board has determined that she should continue to serve as a Director. | | |
michael t. rust | | susan stout tamme | ||
COMMITTEE: Audit Age: 71 Director of Republic since 2007 and Director of the Bank from 2001 to 2007 and since 2020 |
| COMMITTEES: Loan - Chair Compensation Nominating Age: 71 Director of Republic since 2003 and Director of the Bank from 1999 to 2003 and since 2020 |
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KEY EXPERIENCE AND QUALIFICATIONS ● Retired, previously President of Kentucky Hospital Association (1996-2019), including extensive management and regulatory experience. ● Community Based Faculty Member at the University of Kentucky. ● Extensive advocacy experience in Washington, D.C. and Frankfort, Kentucky. ● Leadership and directorate experience in multiple community service organizations. EDUCATION ● University of Tennessee, Master of Public Health ● Glenville State College, Business Administration REASON FOR NOMINATION As a member of the Audit Committee, Mr. Rust can read and understand basic financial statements, such as a balance sheet, income statement, and cash flow statement. Based on Mr. Rust's experience as a Republic and Bank Board Director, his financial experience, his managerial and regulatory compliance background, his business and educational background, his extensive community involvement, including governmental affairs, and his specific experience, qualifications, and attributes disclosed, the Board has determined that he should continue to serve as a Director. | | KEY EXPERIENCE AND QUALIFICATIONS ● Retired, previously employed by Baptist Healthcare System, Inc. and served as President of Baptist Health Collaborations (2013-2014); President of the Louisville Market (2011-2013); President and CEO of Baptist Hospital East (1995-2011); and Vice President of Baptist Healthcare System, Inc. ● Experience in administration, specifically in broad-based multi-hospital systems and proficient in working with department heads, clinical staff, and governmental regulatory bodies. ● Leadership and directorate experience in multiple community service organizations and has received multiple community service awards for excellence and achievement. EDUCATION ● University of Louisville, Master of Science in Health System Administration ● University of Louisville, Bachelor of Science, Nursing ● Eastern Kentucky University, Associate’s Degree, Nursing HONORS AND RECOGNITION ● Appointed as President of Baptist Health Collaborations, 2013 REASON FOR NOMINATION Based on Ms. Tamme’s experience as a Republic and Bank Board Director, her leadership, managerial, and administrative background, regulatory compliance experience, her extensive community involvement, and her specific experience, qualifications, and attributes disclosed, the Board has determined that she should continue to serve as a Director. | ||
12
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2023 PROXY STATEMENT | 23 |
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Director Nominees: | | Director |
Name and Principal Occupation for Past Five Years (continued) | Age | Since |
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Mark A. Vogt is an accomplished and insightful leader with over 30 years of experience. He has served as the CEO of Galen College of Nursing since 2004, leading one of the largest nursing colleges in the country with campuses and programs in Louisville, Kentucky; Hazard, Kentucky; Cincinnati, Ohio; San Antonio, Texas; Tampa, Florida; and online. He has served as a Director of the Bank from 2012 to 2016 and 2020 to present and has served as a Director of Republic since 2016. | 52 | 2016 |
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Prior to joining Galen, Mr. Vogt was Chief Operating Officer of a private equity investment group specializing in the education sector. He served as Senior Vice President and Chief Financial Officer of Republic from 1995 to 2000. As CFO, he provided leadership in accounting, finance, treasury, and various operational functions. During his tenure, he was significantly involved in the Company's initial public offering and the sale and acquisition of several business units. Previously, he was employed for five years by the public accounting firm of Deloitte where he provided accounting and consulting services to a wide array of financial service clients. In addition, he has leadership and directorate experience in several national, civic and community organizations. Mr. Vogt meets NASDAQ’s financial knowledge and sophistication requirements and qualifies as an “audit committee financial expert” under SEC rules. Based on Mr. Vogt's experience as a Bank Board Director, his managerial and accounting background, his education and certification as a Certified Public Accountant, his business background, and his specific experience, qualifications and attributes herein disclosed, the Board has determined that he should continue to serve as a Director. | | |
a. scott trager | | steven e. trager | ||
COMMITTEE: Loan Age: 70 Director of Republic and Director of the Bank since1990 President & Vice Chair, Republic Bancorp, Inc. Vice Chair, Republic Bank & Trust Company |
| Age: 62 Director of Republic and Director of the Bank since1988 Executive Chair & CEO, Republic Bancorp, Inc. Executive Chair, Republic Bank & Trust Company |
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KEY EXPERIENCE AND QUALIFICATIONS ● President of Republic since 2012; Vice Chairman of Republic since 2017; and Vice Chair of the Bank since 2017. ● Previously Vice Chairman of Republic (1994-2012). ● Entire working career spent in various finance and banking capacities. ● Leadership experience in marketing, operations, and community bank management. ● Extensive community board experience and broad-based community connections in the metropolitan Louisville area. EDUCATION ● University of Tennessee, Business Administration REASON FOR NOMINATION Based on Mr. Trager's experience as a Republic and Bank Board Director, his direct banking experience, his proven leadership skills, his educational background, his extensive community involvement and his specific experience, qualifications, and attributes disclosed, the Board has determined that he should continue to serve as a Director. | | KEY EXPERIENCE AND QUALIFICATIONS ● Executive Chair & CEO of Republic and Executive Chair of the Bank since 2021. ● More than thirty years of banking experience previously holding positions of Chairman & CEO of both Republic and the Bank (2012-2021) and President and CEO of Republic (1998-2012), beginning his career with the Bank as General Counsel in 1988. ● Leadership experience in finance, operations, and community bank management. ● Past chair of the Kentucky Bankers Association, University of Louisville Board of Overseers, 2016 Fund for the Arts Campaign, and Leadership Kentucky; former board member of the Federal Reserve Bank of St. Louis’ Louisville Branch and the Louisville Regional Airport Authority; and current member of the Bellarmine University Board of Trustees. EDUCATION ● University of Louisville Brandeis School of Law, Juris Doctor ● University of Texas at Austin, Finance HONORS AND RECOGNITIONS ● Bellarmine University Knight of Knights Honoree, 2022 ● Louisvillian of the Year, 2017 ● Lincoln Foundation Spirit of Excellence Award, 2018 ● Juvenile Diabetes Research Foundation’s Man of the Year, 2003 ● Ernst & Young Entrepreneur of the Year Award for the Southern Ohio and Kentucky Region, 2003 REASON FOR NOMINATION Based on Mr. Trager's experience as a Republic and Bank Board Director, his direct banking experience, his proven leadership skills, his education and legal background, his extensive community involvement, his vested interest in the long-term success of Republic as a material equity owner, and his specific experience, qualifications, and attributes disclosed, the Board has determined that he should continue to serve as a Director. | ||
None
24 | Republic Bancorp, Inc. |
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Republic’s Directors were elected at the most recent Annual Meeting held on April 23, 2020, to a one (1) year term. The Company’s executive officers are recommended by the Chairman and CEO, Steven E. Trager, and are subsequently approved by the Compensation Committee and formally approved by the Board of Directors. Executive Officers hold office at the discretion of the Board of Directors. Thirteen of the fifteen directors attended the 2020 Annual Meeting.
andrew trager-kusman | | Mark A. Vogt | ||
COMMITTEE: Loan Age: 36 Director of Republic since 2019 and Director of the Bank since 2020 Senior Vice President, Chief Strategy Officer, Republic Bank & Trust Company |
| COMMITTEES: Audit – Chair Compensation Nominating – Chair Age: 54 Director of Republic since 2016 and Director of the Bank from 2012 to 2016 and since 2020 |
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KEY EXPERIENCE AND QUALIFICATIONS ● Senior Vice President, Chief Strategy Officer of the Bank since 2021. ● Previously Vice President, Managing Director of Corporate Strategies of the Bank (2016-2021)(primarily overseeing strategic initiatives, profitability modeling, and reviewing potential acquisition opportunities); Portfolio Analyst with EJF Capital LLC (2012-2015), an alternative asset manager primarily focused on United States and global financial institutions (focusing on TARP investments and small bank private equity funds, recapitalizations of struggling institutions, and placement of capital for growth in well-performing banks and routinely speaking with company management and boards regarding regulatory issues and long-term strategies); and worked in the U.S. House of Representatives. ● Member of the Craig Greenberg for Mayor Transition Team and the boards for the Jewish Heritage Fund and Louisville Orchestra Endowment; former trustee for Spalding University, board member for JTomorrow Louisville, and member of the Leadership Louisville Bingham Fellows class of 2019. EDUCATION ● Indiana University, Bloomington, Finance REASON FOR NOMINATION Based on Mr. Trager-Kusman’s experience with the Bank and other entities, experience as a Republic and Bank Board Director, his leadership ability, community involvement and his specific experience, qualifications, and attributes disclosed, the Board has determined that he should continue to serve as a Director. | | KEY EXPERIENCE AND QUALIFICATIONS ● CEO of Galen College of Nursing since 2004, Mr. Vogt has lead Galen in becoming one of the largest educators of nurses in the US growing from three to seventeen campuses. ● Previously the Chief Operating Officer of a private equity investment group specializing in the education sector; Senior Vice President and Chief Financial Officer of Republic (1995-2000), providing leadership in accounting, finance, treasury, and various operational functions and being significantly involved in Republic's initial public offering and the sale and acquisition of several business units; and employed by the public accounting firm of Deloitte (1990-1995) providing accounting and consulting services to a wide array of financial service clients. ● Certified Public Accountant. EDUCATION ● Bellarmine University, Bachelor of Arts, Accounting REASON FOR NOMINATION Mr. Vogt meets NASDAQ’s financial knowledge and sophistication requirements and qualifies as an “audit committee financial expert” under SEC rules. Based on Mr. Vogt’s experience as a Republic and Bank Board Director, his managerial and accounting background, his education and certification as a Certified Public Accountant, his business background, and his specific experience, qualifications, and attributes disclosed, the Board has determined that Mr. Vogt should continue to serve as a Director. | ||
Steven E. Trager and A. Scott Trager are cousins. A. Scott Trager and Andrew Trager-Kusman are cousins. Steven E. Trager is Andrew Trager-Kusman’s uncle.
The Board
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2023 PROXY STATEMENT | 25 |
The Board of Directors and its Committees
The BoardDirectors’ Responsibilities
Each Director is expected to devote sufficient time, energy, and attention to ensure diligent performance of his or her duties and to attend all meetings of the shareholders, the Board, and the Board committees to which they are appointed. The Board of Directors held six (6) regularly scheduled board meetings in 2020.2022. Each of the incumbent Directors attended at least 75% of the total number of meetings of the Board of Directors and the meetings held by committees on which such directorsDirectors served during their respective terms of service in 2020.2022. Also, some selected Company Directors were paid a committee fee for attending certain Bank committee meetings. Directors thatwho are also employees of the Company or the Bank are not paid for attending Board or committee meetings.
Company Directors and Director Nominees are expected to attend the Annual Meeting. Eleven of the sixteen Directors or Director Nominees attended the 2022 Annual Meeting of the Republic shareholders.
Leadership structure
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Executive Chair of the Board of Directors Until October 1, 2021, the Chair and CEO positions for the Company and Bank had been combined. Effective October 1, 2021, Logan M. Pichel was appointed as CEO and President of the Bank and also serves as Director for the Company and the Bank. Steven E. Trager remains CEO of the Company and Executive Chair of both the Company and the Bank. This current structure continues to allow the Independent Directors to concentrate on the oversight of the Company without the added burden of addressing what are normally less material day-to-day managerial concerns. | | 11BLead Independent Director In November 2020, the Company’s Independent Directors appointed Mark A. Vogt as the lead Independent Director. The Independent Directors meet privately at least twice per year following a regularly scheduled Board meeting, may set additional Independent Director meetings, and have the authority to request to speak with any officer or other employee of the Company or the Bank. They also have direct access to and the authority to retain, at the Company’s expense, any outside auditors, accountants, or attorneys at their discretion. |
The Board’s Risk Oversight
The Company believes it has been in the best interest of shareholders that the Chairman and CEO positions have been combined and that such combination has had no negative effect on the operation and direction of the Company. Given Steven E. Trager’s extensive experience in banking and leadership with the company, this current structure allows the independent Directors to concentrate on the oversight of the Company without the added burden of also addressing what are normally less material day-to-day managerial concerns. As a matter of succession planning, the Company continues to evaluate whether or not splitting the positions between two persons will be a viable preferred alternative in the future. As discussed in more detail below, the Bank entered into an agreement in 2020 to employ Logan M. Pichel as the Bank’s President. That agreement provides that if Mr. Pichel is not appointed to the position of CEO of the Bank by January 1, 2022, Mr. Pichel may terminate his employment with “good reason,” as defined in the agreement. Mr. Pichel’s appointment as CEO would result in the division of duties between the Chairman and CEO positions with Mr. Trager remaining the Chairman.
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In November 2020, the Company’s independent directors appointed Mark A. Vogt as the lead independent director. The independent directors meet privately at least twice per year following a regularly scheduled Board meeting, may set additional independent director meetings, and have the authority to request to speak with any officer or other employee of the Company or the Bank. They also have direct access to and the authority to retain, at the Company’s expense, any outside auditors, accountants or attorneys at their discretion.
While the Company’s BoardBoards of Directors is ultimatelyare responsible for risk oversight, selected committeesoversight. The Company and Bank Boards of Directors review, oversee, and approve management’s short- and long-term strategic objectives, including the Company’s Board and the Bank’s Boardstrategic planning, annual budget, significant lending and expenditures over certain limits, and other risks related to financial performance. The following Company and Bank Committees also play an important role in assisting the Company’s Board of Directors in fulfilling itstheir oversight responsibilities. The Company’s Board of Directors analyzes enterprise risk at its regularly scheduled Board meetings and more specifically as described below through the Company’s Audit Committee, the Company’s Compensation Committee, and the Bank’s Enterprise Risk and Community Reinvestment Act Committee. The Company’s Board of Directors and the Bank’s Board of Directors receive regular and timely reports from management and the chairpersons of these committees, as appropriate.
As stated in more detail below, theCompany Committees
Audit Committee. The Audit Committee is responsible for oversight of the Internal Audit function and regularly reviews risks associated with insurance, credit, debt, financial, accounting, compliance, legal, operational, reputational, compliance, third-party, information technology security, and other risk matters involving the Company and the Bank.
Compensation Committee.The Company’s Compensation Committee reviews and approves the Company’s goals and objectives relevant to executive officers’ compensation, evaluates the executive officers’ performance in light of those goals and objectives, and has the sole authority to determine the compensation of the Chair/CEO and other executive officers. It considers risks related to succession planning and approves the Company’s Succession Plan.succession plan. The Compensation Committee also considers risks related to the attraction and retention of critical employees and risks relating to the Company’s incentive compensation programs and contractual employee arrangements. In addition, the Compensation Committee reviews compensation and benefit plans affecting employees generally, in addition to those applicable to NEOs. The Board has delegated management of certain employee benefits plans to the Retirement Committee comprised of key members of management.
26 | Republic Bancorp, Inc. |
Nominating Committee. The Company’s Nominating Committee oversees the Company’s board composition, director succession planning, and provides a recommendation of director independence to the Company and Bank Boards of Directors.
In November 2020, the Bank decided that effective January 1, 2021 it would combine the ComplianceCommittees
Enterprise Risk and Community Reinvestment Committee and the IT Steering Committee to form theAct Committee. The Bank’s Enterprise Risk and Community Reinvestment Act Committee (“ERCRA”) oversees and monitors the Bank’s enterprise risk management practices. ERCRA is responsible for the oversight of the Bank’s compliance management program, including its compliance management system and Community Reinvestment Act, Third-Party Management, insurance, and business continuity programs. In addition, ERCRA assists the Bank’s Board of Directors with monitoring the Bank’s information technology and security plans, policies, in addition to performcompliance with information security and technology risk management requirements.
Loan Committee. With respect to credit risk, loans are approved by Bank management and its Senior and Executive Loan Committees based on delegation set out in the following functions: Bank’s Board-approved Loan Policy. The Bank’s Board of Directors approves loans over thresholds set out in the Loan Policy. Interest rate risk management is delegated to the Interest Rate Risk and Asset-Liability Committees with reporting to the Board. Legal lending limits are reviewed by the Audit Committee of the Company’s Board on a quarterly basis. The Bank Board’s Loan Committee monitors its loan portfolio by reviewing matters such as portfolio growth and production, interest rate averages, and underwriting exceptions. The Board Loan Committee also reviews classified assets and the allowance for credit losses calculation.
Trust Committee. The Bank’s Trust Committee oversees operations of the Trust Department to ensure proper exercise of the fiduciary powers of the Bank.
Key Areas of Risk Oversight as Analyzed by the Company’s and Bank’s Committees
Company’s Committees | ||||
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Audit | | compensation | | NOMINATING |
◾ Financial reporting ◾ Independent auditor ◾ Internal audit function ◾ Internal controls | | ◾ Executive officer compensation ◾ Executive officer succession planning | | ◾ Director independence ◾ Director nomination and |
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Bank’s | ||||
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ercra | | LOAN | | TRUST |
◾ Enterprise risk management ◾ Compliance | ||||
◾ Information technology/security activities | | ◾ Credit risk ◾ Loan portfolio growth and ◾ Classified assets and | | ◾ Trust Department operations |
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2023 PROXY STATEMENT | 27 |
Committees of the Company’s Board of Directors
The Company’s Board has three (3) standing committees to facilitate and assist the Board in the execution of its responsibilities. The Board committees consist of the Audit Committee, the Compensation Committee, and the
14
Nominating Committee. In accordance with NASDAQ listing standards, the Board determines that each of the Board committee members meets the definition of “independent director” and satisfies the NASDAQ listing standards for service on the Board committees on which each serves.serve. In making these determinations, the Board considers all relevant factors.
Charters for each Board committee, as well as the Code of Conduct and Ethics Policy, are available on the Company’s website at www.republicbank.com. The information contained on Republic’s website is not incorporated by reference in, or considered to be a part of, this proxy statement.
The table below details current membership for each of the standing Board committees:
|
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|
|
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Audit Committee |
| Compensation Committee |
| Nominating Committee |
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| |
|
|
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| Heather V. Howell |
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| | Ernest W. Marshall, Jr. |
| | Susan Stout Tamme | | Susan Stout Tamme |
| | Mark A. Vogt | | Mark A. Vogt* |
* Denotes Committee Chair
28 | Republic Bancorp, Inc. |
Audit Committee |
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Chair: | Other Members: | | | |
Mark A. Vogt, CPA | Timothy S. Huval | Michael T. Rust | |
The Audit Committee held eight (8) meetings during 2020. Due to the retirement of Audit Committee Chair, R. Wayne Stratton at the 2020 Annual Meeting, the2022. The Company’s Board of Directors evaluated the credentials of and designated and appointed Mark A. Vogt, CPA, as Chair of the Audit Committee and as the “audit committee financial expert” as required by Section 407 of the Sarbanes-Oxley Act of 2002.
The Company’s Board of Directors adopted a written charter for the Audit Committee, which sets out the functions and responsibilities of the Audit Committee. As described in the charter, the Audit Committee, among other things, is directly responsible for the selection, oversight and compensation of the Company’s independent registered public accounting firm. It is also responsible for the oversight of the accounting and financial reporting processes of the Company, audits of the financial statements and pre-approval of any non-audit services of the independent registered public accounting firm. The Audit Committee is responsible for making recommendations to the Company’s Board of Directors with respect to: the review and scope of audit arrangements; the independent registered public accounting firm’s suggestions for strengthening internal accounting controls; matters of concern to the Audit Committee, the independent registered public accounting firm, or management relating to the Company’s consolidated financial statements or other results of the annual audit; the review of internal accounting procedures and controls with the Company’s financial and accounting staff; the review of the activities and recommendations of the Internal Auditor; and the review of the consolidated financial statements and other financial information published by the Company. Auditors for the Company are required to report directly to the Audit Committee. The Audit Committee is required to pre-approve all audit and permitted non-audit services provided by the Company’s independent registered public accounting firm.
The Audit Committee has recommended, and the Board of Directors has approved and adopted, a Code of Conduct and Ethics Policy that applies to all Directors, Executive Officers, and employees of the Company and the Bank. The Company intends to post on its website, www.republicbank.com, any amendments to, or waivers from, its Code of Conduct and Ethics Policy if any, on its website.for the Company’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions.
Compensation Committee | 2022 Meetings: 5 |
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Chair: | Other Members: | | | |
Ernest W. Marshall, Jr. | George Nichols III | Susan Stout Tamme | Mark A. Vogt | |
The Compensation Committee held seven (7)five (5) meetings during 2020.2022. The Compensation Committee makes recommendations to the Company’s Board of Directors as to the amount and form of NEO compensation and stock incentive awards, if any. The Compensation Committee also reviews and approves the Company’s and the Bank’s Management Succession Plan on an annual basis. The Compensation Committee, in addition to other Bank committees, has reviewed the Company’s Executive Officer incentive plans and oversees the Company’s incentive compensation program in accordance with the recommendations in applicable regulatory guidance. The CHAIR/CEO utilized the services of a compensation consultant, Robert B. Jones from Innovative Compensation and Benefits Concepts, when making several compensation recommendations to the Compensation Committee during 2020, including the compensation for the President, Logan M. Pichel, who began working for the Bank on June 15, 2020. Mr. Jones has extensive experience working on compensation planning and consulting for over 100 companies, including banking, manufacturing, technology, retail, insurance, real estate, pharmaceutical and not-for-profit organizations. In addition, the CHAIR/CEO also utilized the services of Mr. Jones in developing a Long-Term Incentive Program providing a structure for equity awards and change in control agreements, which the Bank awarded several NEOs and other executive officers in January 2021.
The Compensation Committee, the Board, the Company, and
15
management did not otherwise utilize the services of an independent compensation consultant during 2020,2022, nor do any of them have any current arrangements with any compensation advisors or consultants. The CHAIR/Company’s Chair/CEO, makesSteven E. Trager, and the Bank’s CEO and President, Logan M. Pichel, (“CEO/Bank”) make recommendations to the Compensation Committee with respect to all NEO compensation. The Chair/CEO makes recommendations to the Compensation Committee regarding his own compensation including his own.and that of the CEO/Bank.
| |
2023 PROXY STATEMENT | 29 |
Nominating Committee | 2022 Meetings: 1 |
| | | ||
Chair: | Other Members: | | | |
Mark A. Vogt | Heather V. Howell | Ernest W. Marshall, Jr. | Susan Stout Tamme |
The Nominating Committee held one (1) meeting in 2020. In 2021, the2022. The Nominating Committee andof the Company’s Board of Directors approvedoversees the Company’s board composition, director nominees to be considered for election atsuccession, and provides a recommendation of the Annual Meeting. As discussed above, all Director Nominees for 2021 served as Company and/or Bank Directors during 2020. No candidates for Director Nominees for the 2021 Annual Meeting election of Directors were submittedNominees’ independence to the Nominating Committee or the Company’s and Bank’s Board of Directors for consideration by any non-management shareholder.Directors.
The Nominating Committee will consider candidates for director nominees at the 2022 Annual Meeting properly put forth by shareholders. Shareholders should submit such nominations, if any, to the Company’s Secretary, at 601 West Market Street, Louisville, Kentucky 40202, along with the information required in the Bylaws, no later than January 22, 2022. The Nominating Committee will considerconsiders candidates who have a strong record of community leadership in the Company’s and the Bank’s markets. Candidates should possess a strong record of achievement in both business and civic endeavors, possess strong ethics, and display leadership qualities including the ability to analyze and interpret bank financial statements and regulatory requirements, the competence to evaluate endeavors of an entrepreneurial nature and be able to attract new Company banking relationships. Board diversity is also considered, although the Company does not have a formal diversity policy. Recommendations of the “TragerTrager family members (“Trager Family Members”) (generally defined to include Steven E. Trager, who is Chair/CEO, and Jean S. Trager and their descendants, companies, partnerships, or trusts in which they are majority owners, trustees, or beneficiaries) as well as prior service and performance as a Director will also be strongly considered.
The Company does not pay a third-party to assist in identifying and evaluating Director Nominees, but the Company does not preclude the potential for utilizing such services, if needed, as may be determined at the discretion of the Nominating Committee.
In 2023, the Nominating Committee and the Company’s Board of Directors approved the Director Nominees to be considered for election at the Annual Meeting. No candidate that was recommended by a beneficial owner of more than five percent (5%) of the Company’s voting Common Stock was rejected. The “TragerTrager Family Members”Members recommended all Director Nominees submitted to the Nominating Committee and the Company’s Board of Directors. No other shareholdersshareholder submitted a recommendation for a Director Nominee for 2021.the Annual Meeting.
The Nominating Committee will consider candidates for Director Nominees at the Republic 2024 annual meeting of shareholders properly put forth by shareholders. Shareholders should submit such nominations, if any, to the Company’s Secretary, at 601 West Market Street, Louisville, Kentucky, 40202, along with the information required in the Bylaws, no later than January 21, 2024.
30 | Republic Bancorp, Inc. |
DIRECTOR COMPENSATION
For 2022, non-employee Directors of the fifteen Company Directorsand the Bank received an annual stock retainer of approximately $25,000 (based on whole share value), fees of $4,000 for each board meeting attended, and fees of $1,000 for each committee meeting attended. On occasion, brief, typically single-issue meetings are held for which there is no compensation. The committee chairpersons received an annual committee chair retainer fee of $10,000 for each committee chaired.
At its May 18, 2022 meeting, the 2020 Annual Meeting. All CompanyBoard approved that the 2022 annual stock retainers for the Directors and Committee Chairs would be determined by using the Company’s closing stock price on that day, which resulted in each Director Nomineesbeing awarded 573 shares of Class A Common Stock.
Non-employee Directors have the option of allocating their stock awards and fees into the Non-Employee Director and Key Employee Deferred Compensation Plan. Amounts deferred in the Non-Employee Director and Key Employee Deferred Compensation Plan are requesteddeemed to attend and are expectedbe invested in Class A Common Stock. Cash dividend equivalents with respect to attend the 2021 Annual Meeting.
Hedging Transactions Prohibited
deferred amounts were converted into stock equivalents on a quarterly basis during 2022. The Company has an insider trading policy that, among other things, prohibits alldoes not make matching contributions for amounts deferred by the Directors. Compensation paid or deferred to Directors of its employees (including officers) and Directors from engaging in hedging transactions in the Company’s shares. Hedging transactions can be accomplished through a number of ways, including through the use of financial instruments suchRepublic during 2022 for services as prepaid variable forward contracts, equity swaps, collars and exchange funds. Such transactions may permit a Director officer or employee to continue to own Company securities obtained through employee benefit plans or otherwise, but without the full risksof Republic, including amounts paid in 2022 for 2021 and rewards2022 committee chair retainers, were as follows:
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
(a) | | (b) | | (c) | | (d) | | (e) | | (f) | | (g) | | (h) |
|
| |
| |
| |
| |
| Change in |
| |
| |
| | | | | | | | | | Pension Value | | | | |
| | | | | | | | | | and Non- | | | | |
| | Fees | | | | | | | | Qualified | | | | |
| | Earned | | Stock | | | | Non-Equity | | Deferred | | All Other | | |
| | or Paid in | | Awards | | Option | | Incentive Plan | | Compensation | | Compensation | | |
| | Cash (2) | | (2, 3) | | Awards | | Compensation | | Earnings | | (4) | | Total |
Name (1) | | ($) | | ($) | | ($) | | ($) | | ($) | | ($) | | ($) |
| | | | | | | | | | | | | | |
Ronald F. Barnes |
| 22,000 |
| — |
| — |
| — |
| — |
| — |
| 22,000 |
Laura M. Douglas | | 23,063 |
| — |
| — |
| — |
| — |
| — |
| 23,063 |
David P. Feaster |
| 31,000 |
| 24,966 |
| — |
| — |
| — |
| 68,860 |
| 124,825 |
Jennifer N. Green |
| 21,000 |
| 24,966 |
| — |
| — |
| — |
| — |
| 45,966 |
Craig A. Greenberg |
| 57,000 |
| 24,966 |
| — |
| — |
| — |
| — |
| 81,966 |
Heather V. Howell |
| 21,000 |
| 24,966 |
| — |
| — |
| — |
| — |
| 45,966 |
Timothy S. Huval |
| 23,000 |
| 24,966 |
| — |
| — |
| — |
| — |
| 47,966 |
Ernest W. Marshall, Jr. |
| 31,000 |
| 24,966 |
| — |
| — |
| — |
| — |
| 55,966 |
W. Patrick Mulloy, II |
| 28,000 |
| 24,966 |
| — |
| — |
| — |
| — |
| 52,966 |
George Nichols, III |
| 41,000 |
| 24,966 |
| — |
| — |
| — |
| — |
| 65,966 |
W. Kennett Oyler, III |
| 32,000 |
| 24,966 |
| — |
| — |
| — |
| — |
| 56,966 |
Michael T. Rust |
| 34,000 |
| 24,966 |
| — |
| — |
| — |
| — |
| 58,966 |
Susan Stout Tamme |
| 45,000 |
| 24,966 |
| — |
| — |
| — |
| — |
| 69,966 |
Mark A. Vogt |
| 72,000 |
| 24,966 |
| — |
| — |
| — |
| — |
| 96,966 |
| (1) | Steven E. Trager, A. Scott Trager, Logan M. Pichel, and Andrew Trager-Kusman, who served as Directors in 2022, are not included in this table as they are Executive Officers and received no additional compensation for their services as Directors. The compensation received by Steven E. Trager and Logan M. Pichel is included in the "Summary Compensation Table." |
| |
2023 PROXY STATEMENT | 31 |
| (2) | Of these stock awards and fees, the Directors deferred the entire amount earned, except for (1) Ronald F. Barnes who was paid $4,000 in cash with the balance being deferred, (2) Laura M. Douglas who was paid $12,563 in cash with the balance being deferred, (3) Jennifer N. Green who was paid $21,000 in cash with the balance being deferred, (4) Timothy S. Huval who was paid $23,000 in cash with the balance being deferred, (5) Ernest W. Marshall, Jr. who was paid $3,100 in cash with the balance being deferred, and (6) W. Kennett Oyler, III who was paid $32,000 in cash with the balance being deferred. |
| (3) | Reflects 573 shares of Class A Common Stock awarded in 2022. Amounts shown represent the aggregate grant date fair values computed in accordance with FASB ASC Topic 718. For a discussion of the assumptions used in determining these values, see Note 17 of the financial statements in the Company’s 2022 Form 10-K. |
| (4) | Amount reflects monthly payments of $5,000, along with expenses and monthly dues to a Florida country club for consulting services as described more fully herein at “Certain Relationships and Related Transactions—Employment Relationship and Consulting Agreement with Director.” |
16
32 | Republic Bancorp, Inc. |
EXECUTIVE OFFICERS
Set forth below is information about the Bank’s Executive Officers, other than Steven E. Trager, A. Scott Trager, Logan M. Pichel, and Andrew Trager-Kusman, each of whom is also a Director Nominee and discussed above.
Christy A. Ames | Age: 50 |
Position with the Company and the Bank: Secretary of the Company and the Bank; EVP, General Counsel | |
Christy A. Ames has served as the Secretary for the Company and the Bank and the Bank’s General Counsel since joining the Company in January 2018.
Pedro Bryant | Age: 61 |
Position with the Bank: EVP, Senior Business Development Executive | |
Pedro Bryant began serving as Senior Business Development Executive in January 2023. Mr. Bryant joined the Bank in July 2020 serving as Managing Director of Community Lending. Prior to the Bank, Mr. Bryant served from 2002 to 2020 as President and CEO of Metro Bank, a Louisville-based community development bank.
Steven E. DeWeese | Age: 54 |
Position with the Bank: EVP, Managing Director of Commercial and Private Banking | |
Steven E. DeWeese has served as the Bank’s Managing Director of Commercial and Private Banking since 2019. Mr. DeWeese joined the Bank in 1990 serving in various business development and retail banking positions.
Juan M. Montano | Age: 53 |
Position with the Bank: EVP, Chief Mortgage Banking Officer | |
Juan M. Montano has served as the Bank’s Chief Mortgage Banking Officer since 2018. Mr. Montano joined the Bank in 2009 serving in various mortgage and finance positions.
William R. Nelson | Age: 59 |
Position with the Bank: President of Bank's Republic Processing Group | |
William R. Nelson has served as President of Republic Processing Group since joining the Bank in 2007.
Anthony T. Powell | Age: 55 |
Position with the Bank: EVP, Chief Credit Officer | |
Anthony T. Powell has served as the Bank’s Chief Lending Officer since 2017. Mr. Powell joined the Bank in 1999 serving in various lending, credit, and retail banking positions.
John T. Rippy | Age: 62 |
Position with the Bank: Assistant Secretary of the Company and the Bank; EVP, Chief Risk Officer | |
John T. Rippy has served as Chief Risk Officer of the Bank since 2018. Mr. Rippy joined the Bank in 2005 serving previously as the Risk Management Officer and Chief Legal and Compliance officer.
| |
2023 PROXY STATEMENT | 33 |
Kevin D. Sipes | Age: 51 |
Position with the Bank: EVP, CFO, and Chief Accounting Officer of the Company and Bank | |
Kevin D. Sipes has served as Treasurer of the Company and Bank since 2002 and CFO of the Company and Bank since 2000. Mr. Sipes joined the Bank in 1995 serving in various accounting and finance positions.
Jeff Starke | Age: 45 |
Position with the Bank: EVP, Chief Information Officer | |
Jeff Starke has served as the Bank’s Chief Information Officer since joining the Bank in 2021. Previously, Mr. Starke held various technical and operational roles in the financial services industry for over 20 years.
Margaret S. Wendler | Age: 68 |
Position with the Bank: EVP, Chief Human Resources Officer | |
Margaret S. Wendler has served as the Bank’s Chief Human Resources Officer since 2019. Ms. Wendler joined the Bank in 1996 serving in training positions and human resource positions since 2005.
34 | Republic Bancorp, Inc. |
COMPENSATION DISCUSSION AND ANALYSIS
The Compensation Committee, which is comprised of fivefour independent Company directors,Directors, is responsible for approving the compensation of the Company’s Named Executive Officers (“NEOs”) and NEO compensation policies. The Compensation Committee also recommends the appointment of the Company’s and the Bank’s other executive officers (“EO”).Executive Officers. The Compensation Committee’s determinations are routinely subsequently approved by the Company’s and the Bank’s Board of Directors without change. The Company does not separately compensate its NEOs, all of whom are EOsExecutive Officers of the Company’s sole banking subsidiary, the Bank, and are compensated directly by the Bank for their services.
Following is a list of the Company’s 20202022 NEOs along with other pertinent information:information as of December 31, 2022:
Named Executive |
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| Kevin D. Sipes | William R. Nelson | John T. Rippy | |||
|
| Company |
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| ||||||
|
| Office |
| Executive |
|
| ||||||
|
|
|
| N/A | | Chief Financial Officer | | N/A | | Assistant Secretary | ||
Bank Office | | Executive Chair | | President and Chief Executive Officer |
|
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|
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|
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| ||||||
|
| Executive Vice President and Chief Financial Officer |
|
|
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| ||||||
|
|
| President of Republic Processing Group |
|
|
| ||||||
|
|
| Executive Vice President and Chief | |||||||||
Immediate Supervising Executive |
|
|
| Chair/CEO | | CEO/Bank | | Chair/CEO | | CEO/Bank | ||
Area of Management | | Company and Bank | | Bank | | Company and Bank | | Republic Processing Group | | Company and Bank | ||
Proposer of 2022 Compensation Package | | Chair/CEO | | Chair/CEO | | Chair/CEO and CEO/Bank | | Chair/CEO | | Chair/CEO and CEO/Bank |
N/A–Not Applicable
| |
2023 PROXY STATEMENT | 35 |
| | Objectives of the Company’s Compensation Program. | | |
| | | | |
| The purpose of the Company’s Compensation Program is to establish and maintain suitable financial compensation | | ||
| | | ||
| | Say on Pay Result from 2021 Annual Shareholder Meeting. | |
| | | |
| The Company most recently held an advisory say-on-pay vote at its April 22, 2021 annual shareholder meeting. Shareholders approved the compensation of the NEOs, with over 99% of shareholder votes cast (including abstentions) voting in favor of the say-on-pay proposal. The Compensation Committee viewed these results as evidence that shareholders continue to support the Company’s executive compensation policies and practices. | ||
| | ||
| | Compensation Elements. | | | |
| | | | ||
| The Company’s Compensation Program has four (4) principal elements: Base Salary Compensation Program, Bonus Incentive Compensation Program, Stock Incentive Program, and Non-Employee Director and Key Employee Deferred Compensation Plan. The Base Salary Compensation Program and the Company’s Bonus Incentive Compensation Program are annual programs. Stock incentives under the Stock Incentive Program may be awarded at any time during the year to some or all NEOs, subject to the | | |||
| Chair/CEO PAY MIX | AVG. NEO PAY MIX (excluding Chair/CEO) | | ||
|
|
| | ||
| | | |||
Objectives of the Company’s Compensation Program. The purpose of the Company’s Compensation Program is to establish and maintain suitable financial compensation and financial rewards for job performance that principally focus on the degree to which the Company’s profit objectives, as outlined in the Company’s budget, have been met or substantially met. Other goals are assigned and attributed to certain NEOs in the primary areas of loan and deposit growth, loan loss control, risk management, regulatory control, customer service, product development, and operations.
In deciding to generally continue with the Company’s existing compensation practices, the Compensation Committee considered that holders of approximately 99% of the votes cast on an advisory basis at the Company’s 2019 Annual Meeting of Shareholders approved the compensation of the Company’s NEOs. As set forth in Proposal Two, Shareholders have the opportunity to cast their advisory vote on executive compensation at the 2021 Annual Meeting of Shareholders. The Company’s current policy is to hold this advisory vote every two years.
Compensation Elements. The Company’s Compensation Program has four (4) principal elements: Base Salary Compensation Program, Bonus Incentive Compensation Program, Stock Incentive Program, and Non-Employee Director and Key Employee Deferred Compensation Plan. The Base Salary Compensation Program and the Company’s Bonus Incentive Compensation Program are annual programs. Stock incentives under the Stock Incentive Program may be awarded at any time during the year to some or all Company NEOs, subject to the recommendation of the CHAIR/CEO and the approval of the Compensation Committee and the Board of Directors. For a description of the Non-Employee Director and Key Employee Deferred Compensation Plan, see the accompanying description in the “Nonqualified Deferred Compensation” table herein.
17
In addition to the four elements listed above, some NEOs, based on their respective participation, may be included in additional bonus plans related to acquisitions or sales of lines of business, such as the Company’s Acquisition2021 Tax Refund Solutions (“TRS”) Transaction Bonus Plan. The Company’s Acquisition Bonus Plan provides for a bonus payout for the achievement of profit objectives based solely on the profitability of the Company’s acquisitions, as may be applicable.Program.
NEOs also participate in Company-wide employee benefit plans and typically are rewarded, as part of their base compensation, additional selected customary business-related perquisites such as, by way of example, car allowances and country club memberships.
36 | Republic Bancorp, Inc. |
2022 Compensation Components Summary
Objective | | Additional Explanation | |||
Base Salary Compensation Program | The primary purpose of base salary is to recognize and reward overall responsibilities, performance, experience, and established skills. | | Annual program Chair/CEO – 55% of 2022 pay mix NEOs* – 42% of 2022 pay mix | ||
Bonus Incentive Compensation Program | An annual cash bonus program that rewards NEOs for the achievement of short-term financial and operational goals that drive Gross Operating Profit and shareholder value, as well as individual performance. | | Annual program Chair/CEO – 40% of 2022 pay mix NEOs* – 27% of 2022 pay mix | ||
Stock Incentive Program | Granted from time to time to provide the NEOs and Executive Officers with incentives to maximize the Company’s Gross Operating Profit (“GOP”), as well as to provide retention incentives. | | May be awarded any time during the year subject to the recommendation of the Chair/CEO and CEO/Bank and the approval of the Compensation Committee NEOs* - 27% of 2022 pay mix | ||
Non-Employee Director and Key Employee Deferred Compensation Plan | | Matching contributions are designed to provide retention incentives and to balance NEO and Director interests with those of the Company’s shareholders. | | NEOs* – 2% of 2022 pay mix | |
Acquisition Bonus Plan and TRS Transaction Bonus Program | | Granted to incentivize NEOs, Executive Officers, and other Company employees to maximize Company earnings and to implement target integration components relating to acquisitions or divestitures. | | Some NEOs, based on their respective participation, may be included in additional bonus plans related to acquisitions or divestitures | |
Other | | NEOs participate in Company-wide employee benefit plans. | | Typically rewarded as part of the base compensation, additional selected customary business-related perquisites would include car allowances and country club memberships Chair/CEO – 5% of 2022 pay mix NEOs* – 2% of 2022 pay mix *Excluding Chair/CEO | |
Purpose of the Company’s Compensation Elements.Elements
Base Salary Compensation Program.
The primary purpose of the Base Salary Compensation Program component of the Company’s Compensation Program is to provide base compensation for ordinary living expenses. The Company wants to provide its NEOs with arecognize and reward overall responsibilities, performance, experience, and established skills. Changes in base salary that supports a reasonable lifestyle that is comparableresult primarily from comparison against peers, individual and Company performance, internal equity considerations, value to their highthe organization, promotions, and visible standing in the community, one that supports the demands from the community given that standing and their community visibility, and one that also provides reasonable compensation for the performance of their duties andexecutive’s specific responsibilities directly associated with their NEO status.compared to market.
Bonus Incentive Compensation Program.
The Compensation Committee sets the Bonus Incentive Compensation Program goals, in terms of both incentives to be paid and Gross Operating Profit (“GOP”)GOP profit goals, are set at the beginning of the Company’s fiscal year (except for the PRES/Pres/RPG whose goals are set later in the fiscal year) by the. The Bonus Incentive Compensation Committee and are used toProgram goals provide the NEOs and EOsExecutive Officers with incentives to improve both short-term and long-term Company performance.
Stock Incentive Program.
Stock Incentive Program compensation awards are also granted from time to time to provide the NEOs and EOsExecutive Officers with incentives to maximize the Company’s GOP, as well as to provide retention incentives.
| |
2023 PROXY STATEMENT | 37 |
Non-Employee Director and Key Employee Deferred Compensation Plan. Similarly, matching
Matching contributions made for NEOs and EOs pursuant toExecutive Officers under the Non-Employee Director and Key Employee Deferred Compensation Plan are designed to provide retention incentives.
Acquisition Bonus Plan.Plan and TRS Transaction Bonus Program.
Acquisition Bonus Plan awards are granted to incentivize NEOs, EOs,Executive Officers, and other Company employees to maximize Company earnings and to implement target integration components relating to acquisitions, such as timely and accurate system conversions, in order to maximize operational efficiencies associated with acquisitions.acquisitions. The TRS Transaction Bonus Program was created to award certain Bank employees, including three NEOs and other Executive Officers, for facilitating the proposed 2021 sale of substantially all of the assets of the Bank’s TRS segment and to incentivize them to lead a timely and smooth transition of the TRS business to Green Dot Corporation.
Establishment of Compensation Levels.Levels
The Company’s compensation elements are designed to be generally competitive with similar employment opportunities or positions in similarly sized companies. GOP forThe Chair/CEO has traditionally made specific executive compensation recommendations to the total Company is a central metric in determining mostCompensation Committee on all NEO compensation elements, including his own. Effective October 1, 2021, the Bank appointed the CEO/Bank, its then President, to be the Chief Executive Officer and President of the Bank. Subsequently, the Chair/CEO and CEO/Bank jointly make compensation recommendations to the Compensation Committee, except that Chair/CEO singularly continues to provide recommendations regarding his own and the CEO/Bank’s compensation. GOP is defined as “income before income tax expense” in accordance with generally accepted accounting principles (“GAAP”).
PEER DATA
The Compensation Committee historically has not historically relied on benchmarking to determine its compensation elements; rather, the Compensation Committee has given strong consideration to and has not historically deviated from the recommendations of the CHAIR/CEO. While the CHAIR/CEO’s recommendations generally are based upon his individual judgment, in 2020, the CHAIR/Chair/CEO engaged and used the services of a compensation consultant, Robert B. Jones from Innovative Compensation and Benefits Concepts, when making several compensation recommendations, including the compensation for the PRES and the structure of equity awards designed to provide long-term incentives, which the Company awarded to the CFO, PRES/RPG, and other executive officers in January 2021.CEO/Bank. The Compensation Committee annually reviews various peer data to determine if compensation levels are within reasonable ranges as compared to those benchmarks. In 2020,peer levels. For its 2023 compensation determinations, the Compensation Committee considered compensation data from the following peers:
| ◾ | Metropolitan Commercial Bank, |
| ◾ | Green Dot Corporation, |
| ◾ | Lakeland Financial Corp., |
| ◾ | Community Trust Bancorp, |
| ◾ | 1st Source Corporation, |
| ◾ | Park National Corporation, |
| ◾ | FB Financial Corporation, |
| ◾ | SY Bancorp, |
| ◾ | Premier Financial Corp., |
| ◾ | German American Bancorp, |
| ◾ | First Savings Financial Group, and |
| ◾ | City Holding Company. |
After review of this peer data, the Compensation Committee made no additional compensation adjustments from the CHAIR/Chair/CEO’s recommendations based on the peer data reviewed. and CEO/Bank’s recommendations.
THIRD-PARTY CONSULTANT
The Compensation Committee hasgenerally does not, and in 2022 did not, directly engagedengage a third-party executive compensation consultant.
The CHAIR/CEO makes specific executive If the Chair/CEO’s and CEO/Bank’s compensation recommendations to the Compensation Committee on all NEO compensation elements, including his own. The CHAIR/CEO will recommend his own compensation, which, ifare reasonable in the collective subjective judgment of the Compensation Committee, is normally and historically accepted and approved by the Compensation Committee and ultimately the Board of Directors normally and historically accept and approve these recommendations without modification. If
38 | Republic Bancorp, Inc. |
PRIMARY METRIC IN NEO COMPENSATION DETERMINATION
GOP for the total Company is the primary metric in determining most NEO compensation. (GOP is defined as “income before income tax expense” in accordance with U.S. generally accepted accounting principles (“GAAP”)).
With respect to the Base Salary Compensation Program, if the Company’s financial performance is deemed acceptable in the view of the CHAIR/Chair/CEO and the CEO/Bank, regardless of whether or not the
18
Company’s GOP goals are met, annual increases to base salary are typically, but not always, grantedrecommended in response to generally recognized cost of living factors and as a reward for acceptable performance. While the Compensation Committee considers cost of living adjustments when evaluating base salary, such adjustments are not automatic, but are also dependent on satisfactory earnings and other performance factors. The Compensation Committee does not apply any particular formula or measurement in making these determinations. The
For the Bonus Incentive Compensation Committee used its collective judgmentProgram, GOP has historically been, and consideredcontinues to be, the recommendationsprimary factor upon which awards are determined. Each of the CHAIR/CEO in determining base salary levels for 2020 and 2021. Going forward, the Compensation Committee, will continue to make its determinations by using its collective judgment and by considering the recommendations of the CHAIR/CEO. It will continue not to apply any particular formula or measurement regarding base salary, but the degree to which the Company’s GOP budget goals are attained remains a primary consideration in all compensation decisions.
The Compensation CommitteeChair/CEO, or the CHAIR/CEO isCEO/Bank are authorized to recommend adjustments in the terms and conditions of, and the criteria included in the achievement of, the Bonus Incentive Compensation Program. The CHAIR/Chair/CEO canand the CEO/Bank make the recommendations to the Compensation Committee in recognition of unusual, extraordinary, or non-recurringnonrecurring events. These events affecting the performance of the NEO, the Company, or the financial statements of the Company could include:
| acquisitions and dispositions of businesses and/or assets; |
| a health or |
| changes in applicable laws, regulations, accounting principles, tax rates, or business conditions; |
| unpredicted changes in economic and business |
| personal performance of the NEO; and |
| any other circumstances deemed relevant. |
As previously stated,In 2022, the compensationCompany excluded from its GOP calculations, including its calculation of “Total Company GOP” and “RPG GOP”, the $13 million settlement amount and $5 million termination fee (collectively, the “Settlement”), and associated expenses, the Bank accepted to resolve its lawsuit with Green Dot Corporation for Green Dot’s failure to consummate the purchase of the NEOs is principally recommended byBank’s TRS segment (the “Lawsuit,” described below in the CHAIR/CEO“TRS Transaction Bonus Program” section of this Compensation Discussion and Analysis). The Settlement was an unusual, extraordinary, and nonrecurring event that was not in line with considerationthe purpose of the recommendations of the NEO’s immediate supervising executive. These recommendations, if reasonable in the subjective judgment of theBonus Incentive Compensation Committee, are also normally and typically accepted and approved by the Compensation Committee and ultimately the Board of Directors without modification. The Board of Directors upon recommendation by the Compensation Committee approves all NEO base salary and incentive bonus compensation.Program.
The Company’s Base Salary Compensation Program. Program
2022 NEO Base Salaries.
Upon the recommendation of the CHAIR/Chair/CEO and CEO/Bank, the Compensation Committee approved the annual base salaries for the Chair/CEO, CEO/Bank, CFO, Pres/RPG, and CRO for 2022 along with their respective percentage increases over the prior year as shown in the table below. While the Chair/CEO recommended a base salary increase for the CEO/Bank, the CEO/Bank declined any increase for 2022, and accordingly, no base salary increase for the CEO/Bank was presented to the Compensation Committee for consideration. These annualized base salary increases for 2022 were effective January, 2022 for the Chair/CEO, CEO/Bank, CFO, and CRO and October, 2021 for the Pres/RPG.
| |
2023 PROXY STATEMENT | 39 |
| | | | | | |
| | |
| |
| |
| | | | Approximate % | | |
Named Executive Officer |
| 2022 Salary ⁽¹⁾ |
| Increase Over Prior Year | | |
Steven E. Trager (Chair/CEO) | | $ | 442,160 |
| 1.5 | % |
Logan M. Pichel (CEO/Bank) | | $ | 650,000 |
| – | |
Kevin D. Sipes (CFO) | | $ | 364,756 |
| 1.5 | % |
William R. Nelson (Pres/RPG) | | $ | 394,014 |
| 3.0 | % |
John T. Rippy (CRO) | | $ | 340,000 |
| 11.6 | % |
| (1) | Amounts shown represent annualized base salaries for the 2022 calendar year with changes over the previous calendaryear’s base salaries, except for the Pres/RPG, which represents his annualized base salary for the RPG 2021-2022 fiscal year and its change over his previous annualized base salary for the RPG 2020-2021 fiscalyear. |
2023 NEO Base Salaries.
Upon the recommendation of the Chair/CEO and CEO/Bank, the Compensation Committee approved the annual base salaries for the NEOs for 2020 along with their respective percentage increases over the prior year as shown in the table below. These base salary increases for 2020 were effective January 27, 2020 for all NEOs except for the PRES/RPG; his increase was effective July 27, 2020.
| | | | | | |
| | | | | | |
Named Executive Officer |
| 2020 Salary |
| Approximate % Increase Over Prior Year | | |
Steven E. Trager (CHAIR/CEO) | | $ | 425,000 | | 7.9% | |
Kevin D. Sipes (CFO) | | $ | 354,055 | | 3.0% | |
William R. Nelson (PRES/RPG) | | $ | 378,750 | | 0.0% | |
Juan M. Montano (EVP/CMBO) | | $ | 326,863 | | 3.0% | |
| | | | | | |
On April 24, 2020, the Bank entered into an employment agreement (“Employment Agreement”) with Logan M. Pichel to serve as President (the “PRES”) of the Bank beginning on June 15, 2020. The Employment Agreement’s initial term ends on December 31, 2021, with automatic annual renewals thereafter for successive one-year periods unless either party elects not to renew by providing written notice to the other party at least 60 days prior to the expiration of the then-current term. The Employment Agreement provides for a starting annual base salary of $650,000, a guaranteed bonus payout of $325,000 on March 12, 2021 with respect to 2020, provided that the PRES is an employee of the Bank on that date, a $75,000 relocation payment, a target bonus potential of $500,000 for the 2021 calendar year and thereafter, and provision of benefits made available to other executive officers. As discussed in the “Company Stock Incentive Plan and Non-Employee Director and Key Employee Compensation Plan”, and the “Post-Employment Compensation” sections below, the PRES’s Employment Agreement also contains equity compensation, severance and change of control components. The terms and compensation components of the Employment Agreement were negotiated at arm’s length between the CHAIR/CEO and PRES and then approved by the Compensation Committee and the Board upon the recommendation of the CHAIR/CEO. Due to the PRES’s hire date of June 15, 2020 and the PRES being
19
employed by the Bank for only half of 2020, the Company did not include the PRES’s compensation on the tables in this section.
Upon the recommendation of the CHAIR/CEO, the Compensation Committee approved the annual base salaries for the NEOs for 2021,2023, based on 20202022 performance and other competitive factors, along with their respective percentage increases over the prior year as shown in the table below. All annualized base salary increases except for the PRES/RPG, were effective January, 25, 2021.2023, except for Pres/RPG whose increase was effective October, 2022. The PRES/base salary of the Pres/RPG will be evaluated in mid-year 2021,the third quarter of 2023, based primarily on the performance of the RPG business operations from October, 1, 20202022 to September, 30, 2021.2023.
| | | | | | |
| | | | | | |
| | | | Approximate % | | |
Named Executive Officer |
| 2023 Salary ⁽¹⁾ |
| Increase Over Prior Year | | |
Steven E. Trager (Chair/CEO) | | $ | 451,000 |
| 2.0 | % |
Logan M. Pichel (CEO/Bank) | | $ | 663,000 |
| 2.0 | % |
Kevin D. Sipes (CFO) | | $ | 372,051 |
| 2.0 | % |
William R. Nelson (Pres/RPG) | | $ | 400,000 |
| 3.0 | % |
John T. Rippy (CRO) | | $ | 347,000 |
| 2.1 | % |
| | | | | | |
| | | | | | |
Named Executive Officer |
| 2021 Salary |
| Approximate % Increase Over Prior Year | | |
Steven E. Trager (CHAIR/CEO) | | $ | 435,625 | | 2.5% | |
Kevin D. Sipes (CFO) | | $ | 359,366 | | 1.5% | |
William R. Nelson (PRES/RPG) | | $ | 382,538 | | 1.0% | |
Juan M. Montano (EVP/CMBO) | | $ | 335,035 | | 2.5% | |
| | | | | | |
| (1) | Amounts shown represent annualized base salaries for the 2023 calendar year with changes over the previous calendar year’s base salaries, except for the Pres/RPG, which represents his annualized base salary for the RPG 2022-2023 fiscal year and its change over his previous annualized base salary for the RPG 2021-2022 fiscal year. |
The Company’s Bonus Incentive Compensation Program. Program
BONUS INCENTIVE COMPENSATION PROGRAM GENERALLY
The Bonus Incentive Compensation Program is designed to reward those individuals who contribute through their own performance and their influence on others to achieve and exceed the Company’s financial goals, and to a lesser extent, other goals that target performance in areas required to run a successful banking operation. GOP
Company stock performance is not a component of evaluation for the total Company remains the central and most important metric in evaluating and determining most NEO compensation for thepurpose of NEOs’ Bonus Incentive Compensation Program.Program, nor has it typically been a factor considered in determining the amount of equity-based incentives to grant each NEO. Republic’s stock is thinly traded with a low average daily stock trading volume that can lead to significant price swings when even a relatively small number of shares are being traded. Therefore, Republic share prices might not accurately reflect Republic management’s efforts and work.
Ultimately, the Compensation Committee believes that reasonable and consistent earnings over time will translate into appropriate and favorable stock performance. The Compensation Committee’s policies are not designed to encourage Republic’s NEOs to manage the Company on a quarter-to-quarter time horizon or even over a one-year period.
40 | Republic Bancorp, Inc. |
Investment in capital improvements, product development, and new market expansion can act to reduce short-term profits while providing for a larger future, longer-term profit potential and/or provide for the long-term soundness and sustainability of the Company’s operations and, thus, its long-term profit potential. All of these factors are considered by the Compensation Committee in its subjective annual evaluation process and deliberations.
STRUCTURE OF PROGRAM
The amount of incentive compensation or bonus actually awarded to the NEOs is determined by the Compensation Committee and the Board of Directors. The “Entry Level” and “Maximum Level” budget goals are designed to be a challenge to meet, particularly for the “Maximum Level” performance tier, but the budget goals and the tiers associated with those goals are not set so as to be impractical or impossible to achieve. The CHAIR/CEO may recommend adjustments to the GOP for any income or expense items which he considers to be unusual, extraordinary, or non-recuring in nature. Such adjustments may impact the compensation of the NEOs and EOs, as approved by the Compensation Committee and the Board of Directors. The PRES/RPG and EVP/CMBO are evaluated based on the GOP of their individual operating units. The Company’s budgeted goals should not be relied upon by any investor or shareholder as an indication of management’s prediction of its future financial performance.
The Compensation Committee also evaluates the Company’s Bonus Incentive Compensation Program for all employees for compliance with applicable regulatory guidance regarding incentive compensation and responsible sales practices.
PRIMARY METRIC
GOP for the total Company remains the central and most important metric in evaluating and determining most NEO compensation for the Bonus Incentive Compensation Program.
For 2022, the Compensation Committee considered the GOP of the total Company (“Total Company GOP”) for the Bonus Incentive Compensation Program award of the Chair/CEO, CEO/Bank, CFO, and CRO. The Pres/RPG is evaluated, primarily, based on the GOP of his individual operating unit (“RPG GOP”).
The Company’s Bonus Incentive Compensation Program for employees, including NEOs, is flexible in design and considers factors beyond the control of any NEO in determining the amount of compensation to be paid to a particular NEO in any given year. If the applicable GOP or non-GOP relatednon-GOP-related goals are not fully achieved, then, as previously disclosed, a percentage of a potential incentive payout may be awarded based on intervening factors, such as economic factors, regulatory changes impacting profit objectives, or management decisions that may impact current profitability, normally made in return for the potential for greater long-term profitability. A percentage of the total bonus potential may be awarded to the NEOs even if certain GOP goals stated in the “Entry Level” budget goals for incentive compensation purposesNEOs’ Bonus Incentive Compensation Program agreements are not fully achieved. PursuantAccording to the bonus agreement with each NEO, the Bonus Incentive Compensation Program potential is subject to amendment, including either upward or downward, at the discretion of the CHAIR/Chair/CEO and CEO/Bank, subject to the approval of the Compensation Committee and ultimately the Board of Directors.
During 2020, In 2022, the COVID-19 pandemic negatively impacted Company’s overall results of operations on a net basis. Despite the challengesbenefit of the pandemic, the Company’s performance in several business units$18 million Settlement, and associated expenses, was historically strong. The Companyconsidered an unusual, extraordinary, and nonrecurring item and, accordingly, was not forced to furlough any employees, did not initiate a reductionincluded in force, or impose any employee pay cuts during 2020 as a result of the pandemic. Conversely, in recognition of the employees’ hard work and dedication, the Company awarded a $500 bonus to its employees at levels below vice president. In addition, for determining bonus payouts for all employees whose incentive compensation was tied to Total Company Core Bank, and/GOP or RPG GOP, the Company made adjustments to those GOPs and awarded 2020 bonus payouts in alignment with the NEOs’ programs described below.GOP.
202022 Bonus Incentive Compensation Program Award for CHAIR/CEO, CEO/BANK, CFO, PRES/RPG, AND CRO
For 2020,2022, the Bonus Incentive Compensation Program awards for the NEOs and related factors are outlined in the table below:
| | | | | | | | | | | | | | |
| | | | | | | | | | | | | | |
|
| |
| |
| |
| |
| Percent of |
| | ||
Named | | | | Entry | | Maximum | | Incentive | | Payout | | Incentive | ||
Executive | | Performance | | Level | | Level | | Payout | | Potential | | Payout | ||
Officer | | Criteria | | Goal | | Goal | | Potential | | Awarded | | Award | ||
| | | | | | | | | | | | | | |
Steven E. Trager (Chair/CEO) |
| Total Company GOP |
| Achieved |
| Not Achieved | | $ | 400,000 |
| 70 | % | $ | 280,000 |
Logan M. Pichel (CEO/Bank) |
| Total Company GOP |
| Achieved |
| Not Achieved | | $ | 500,000 |
| 70 | % | $ | 350,000 |
Kevin D. Sipes (CFO) |
| Total Company GOP |
| Achieved |
| Not Achieved | | $ | 175,000 |
| 70 | % | $ | 122,500 |
William R. Nelson (Pres/RPG) |
| RPG GOP |
| Not Achieved |
| Not Achieved | | $ | 375,000 |
| 0 | % | $ | 0 |
John T. Rippy (CRO) |
| Total Company GOP |
| Achieved |
| Not Achieved | | $ | 175,000 |
| 70 | % | $ | 122,500 |
| | | | | | | | | | |
Named | | Entry | Maximum | Incentive | Percent of | Incentive | ||||
Executive | Performance | Level | Level | Payout | Payout Potential | Payout | ||||
Officer | Criteria | Goal | Goal | Potential | Awarded | Award | ||||
| | | | | | | | | | |
Steven E. Trager (CHAIR/CEO) | Total Company GOP | Achieved, as adjusted | Not Achieved | | $ | 250,000 | 70% | | $ | 175,000 |
| | | | | | | | | | |
| | | | | | | | | | |
Kevin D. Sipes (CFO) | Total Company GOP | Achieved, as adjusted | Not Achieved | | $ | 140,000 | 70% | | $ | 122,500 |
| | | | | | | | | | |
| | | | | | | | | | |
William R. Nelson (PRES/RPG) | RPG GOP | Substantially Achieved, as adjusted | Not Achieved | | $ | 360,000 | 58% | | $ | 210,000 |
| | | | | | | | | | |
| | | | | | | | | | |
Juan M. Montano (EVP/CMBO) | 1. Warehouse Lending | N/A | Achieved | | $ | 175,000 | 100% | | $ | 175,000 |
| 2. Mortgage Lending | N/A | Achieved | | $ | 100,000 | 100% | | $ | 100,000 |
| | | | | | | | | | |
| |
2023 PROXY STATEMENT | 41 |
2022 Bonus Incentive Compensation Program Award for CHAIR/CEO, andCEO/BANK, CFO, based on Total Company GOP. AND CRO
The incentive bonus compensationBonus Incentive Compensation Program potential for the CHAIR/Chair/CEO, CEO/Bank, CFO, and the CFOCRO is tied to the Total Company GOP. For 2020,2022, due to projected global economic uncertainty, the GOP objectives for the CHAIR/Chair/CEO, CEO/Bank, CFO, and CRO were set originally based on separate GOP goals for the first half of 2022 (January – June) and the second half of 2022 (July – December) with each GOP goal earned independently of the other. Under the 2022 Bonus Incentive Compensation Program, the Compensation Committee, at the recommendation of the Chair/CEO and CEO/Bank approved the CFO werefollowing GOP goals for January – June 2022 with the following:Total Company GOP for July – December 2022 set to be determined (“TBD”) in June of 2022:
| to achieve 70% of the bonus compensation potential (the “Entry Level” objective), the Total Company GOP goal for the first six months of the year was set at |
| to achieve 85% of the bonus compensation potential (the “Mid-Level” objective), the Total Company GOP goal for the first six months of the year was set at |
| to achieve 100% of the bonus compensation potential (the “Maximum Level” objective), the Total Company GOP goal for the first six months was set at |
| | | | | | | |
Bonus Incentive | | Percentage of Bonus | | Total Company | | Total Company | |
Compensation Program | | Incentive Compensation | | GOP Goal for | | GOP Goal for | |
Level Objective |
| Program Potential |
| January - June 2022 |
| July - December 2022 | |
Entry Level |
| 70% | | $ | 55,075,000 |
| TBD |
Mid-Level |
| 85% | | $ | 60,075,000 |
| TBD |
Maximum Level |
| 100% | | $ | 62,575,000 |
| TBD |
In 2020,Due to unexpected market conditions, such as rapidly increasing interest rates that adversely impacted mortgage lending and warehouse segments, the higher “Maximum Level” budget goalTotal Company GOP Entry Level objective for the CHAIR/first half of 2022 was not achieved with the Total Company GOP being $50,216,835. The benefit of the $18 million Settlement, and associated expenses, was considered an unusual, extraordinary, and nonrecurring item and, accordingly, was not included in the Total Company GOP.
In July 2022, at the recommendation of the Chair/CEO and the CFO, which usually results in the full NEO bonus potential being awarded, was not achieved. The CHAIR/CEO recommended, andCEO/Bank, the Compensation Committee approved consistent with the program for all employees whose incentive compensation is tied to Total Company and Core Bank GOP, the following adjustments to the 2020 Total Company GOP for the purposean adjustment of the CHAIR/CEO’s and CFO’s2022 Bonus Incentive Compensation Program. Under the 2022 Bonus Incentive Compensation Program, award calculation.
| | | |
Description |
| (in thousands) | |
| | | |
Total Company GOP, As Reported | | $ | 102,632 |
| | | |
Adjustments: | | | |
| | | |
Add: Impact of increase in Allowance for Credit Losses on Core Bank Loans due to COVID | | | 15,930 |
| | | |
Add: Impact of Early Termination Penalties on FHLB Advances | | | 2,108 |
| | | |
Subtract: Impact of decrease in Allowance for Credit Losses on RPG line-of-credit product from 01/01/2020 – 12/31/2020 | | | (4,357) |
| | | |
Total GOP Adjustments | | | 13,681 |
| | | |
Total Company GOP, As Adjusted | | $ | 116,313 |
| | | |
If the Company had not incurred these impacts to total Company GOP during 2020,as amended, the Total Company GOP would have achieved the “Mid-Level” objectivebe calculated for the entire year as of December 31, 2022, instead of having the Total Company GOP goal divided into two separate, independent Total Company GOP goals based on Company performance during the first and bonusessecond half of 2022.
Under the amended 2022 Bonus Incentive Compensation Program for all employees tied to Total Company GOP, including the CHAIR/Chair/CEO, CEO/Bank, CFO, and CRO, the Total Company GOP annual goals were the following:
| ◾ | to achieve the Entry Level objective, 70% of the bonus compensation potential, the Total Company GOP goal for 2022 was set at $99,225,000, which was the Company’s original annual budget that the Board set in January 2022; |
| ◾ | to achieve the Mid-Level objective, 85% of the bonus compensation potential, the Total Company GOP goal for 2022 was set at $109,225,000; and |
| ◾ | to achieve the Maximum Level objective, 100% of the bonus compensation potential, the Total Company GOP goal for 2022 was set at $114,225,000. |
| | | | | |
| | Percentage of | | | |
Bonus Incentive | | Bonus Incentive | | Total Company | |
Compensation Program | | Compensation | | GOP Goal | |
Level Objectives |
| Program Potential |
| for 2022 | |
Entry Level |
| 70% | | $ | 99,225,000 |
Mid-Level |
| 85% | | $ | 109,225,000 |
Maximum Level |
| 100% | | $ | 114,225,000 |
42 | Republic Bancorp, Inc. |
The Entry Level, Mid-Level, and Maximum Level bonus potential for each NEO tied to Total Company GOP is as follows:
| | | | | | | | | |
Named Executive Officer |
| Entry Level (70%) |
| Mid-Level (85%) |
| Maximum Level (100%) | |||
Chair/CEO |
| $ | 280,000 | | $ | 340,000 |
| $ | 400,000 |
CEO/Bank | | $ | 350,000 | | $ | 425,000 | | $ | 500,000 |
CFO |
| $ | 122,500 | | $ | 147,500 |
| $ | 175,000 |
CRO |
| $ | 122,500 | | $ | 147,500 |
| $ | 175,000 |
For the 2022 fiscal year, the Total Company GOP achieved was $99,759,150, excluding the benefit of the Settlement and associated expenses. This resulted in the Chair/CEO, CEO/Bank, CFO, and CRO meeting the Entry Level objective to receive 70% of their Bonus Incentive Compensation Program potential and the NEOs’ receipt of the following payouts under the Bonus Incentive Compensation Program: Chair/CEO ($280,000), CEO/Bank ($350,000), CFO ($122,500), and CRO ($122,500).
The Company also awarded all associates tied to the Total Company GOP, including the Chair/CEO, CEO/Bank, CFO, and CRO, a discretionary bonus of an additional 10% (for a total payout of 80% of their bonus potentials under the Bonus Incentive Compensation Program). This discretionary bonus award was based on the performance of the Core Bank (“Core Bank”), which includes all of the Bank’s lines of business except RPG operations and resulting Core Bank GOP of $60,313,133. Those associates whose Bonus Incentive Compensation Program was tied to Core Bank GOP achieved their Mid-level objective exceeding $58,225,000 in Core Bank GOP, which was 85% of their bonus potential, while the associates whose Bonus Incentive Compensation Program was tied to the Total Company GOP only received their Entry-level objective, which was 70% of their bonus potential. Due to this disparity and the significant contributions that the associates tied to Total Company GOP made to the performance of the Core Bank and achievement of the Core Bank GOP exceeding the Mid-Level objective, the Chair/CEO and CFO would have been paid out atCEO/Bank recommended that the 85% “Mid-Level” objective. In light ofassociates tied to the extraordinary nature ofTotal Company GOP, including Executive Officers and NEOs, receive an additional 10% discretionary bonus. For these items,reasons, the CHAIR/Chair/CEO and the CEO/Bank recommended to the Compensation Committee, and the Compensation Committee concurred, to exercise its discretion to modifythat the incentive bonus compensationfollowing discretionary bonuses be awarded: Chair/CEO ($40,000); CEO/Bank ($50,000); CFO ($17,500); and pay bonuses to these NEOs and other executive officers at the 70% level. Both NEOs and other executives will also have the opportunity to receive an additional 15% in 2021 and, in effect, fullyCRO ($17,500).
| | | | | | | | | | |
| | | | | | | | | | |
| | | Bonus Incentive | | Additional | | Total Award Tied to Bonus | |||
| | | | Compensation Program | | | Discretionary Bonus | | | Incentive Compensation |
| | | Award (Entry Level | | Award (10% of | | Program plus Additional | |||
Named Executive Officer |
| Objective of 70%) |
| Bonus Potential) |
| Discretionary Bonus | ||||
| Chair/CEO |
| $ | 280,000 | | $ | 40,000 |
| $ | 320,000 |
| CEO/Bank | | $ | 350,000 | | $ | 50,000 | | $ | 400,000 |
| CFO |
| $ | 122,500 | | $ | 17,500 |
| $ | 140,000 |
| CRO |
| $ | 122,500 | | $ | 17,500 |
| $ | 140,000 |
21
realize the “Mid-Level” bonus compensation amount should Traditional Bank loan charge-offs remain at an amount the CHAIR/CEO and Compensation Committee deem acceptable during the first half of 2021.
2022 Bonus Incentive Compensation Program Award for PRES/RPG.RPG
Unlike other NEOs, whose goals arewere based on the Company’s fiscal year of January 1 through December 31, for 20202022, the PRES/Pres/RPG originally had goals based on RPG’s seasonally-basedseasonally based measurement period from JulyOctober 1, 20192021 through JuneSeptember 30, 2020.2022 (the “Measurement Period”).
The incentive bonus compensationBonus Incentive Compensation Program potential for the PRES/Pres/RPG is tied to the Republic Processing Group (“RPG”)RPG GOP. For the 2020 measurement period,Pres/RPG’s Measurement Period, the RPG GOP objectives were set at the following:
| “Entry Level” objective for RPG GOP was set at |
Due to various business disruptions caused by
| |
2023 PROXY STATEMENT | 43 |
| | | | | | | | |
| | Bonus Incentive | | | | RPG GOP | ||
Bonus Incentive Compensation | | | Compensation | | Percentage of | | | for 2021-2022 |
Program Level Objectives |
| Program Potential |
| Maximum Level |
| Measurement Period | ||
Entry Level |
| $ | 225,000 | | 60% | | $ | 48,000,000 |
Mid-Level |
| $ | 300,000 | | 80% | | $ | 50,000,000 |
Maximum Level |
| $ | 375,000 | | 100% | | $ | 52,000,000 |
For the pandemic that impacted RPG during2021-2022 Measurement Period, the 2019-2020 performance period, the Compensation Committee, at the CHAIR/CEO’s recommendation in determining the PRES/RPG’s compensation, gave additional credit for TRS loan loss recoveries up until September 30, 2020 for loans previously charged off by TRS during the first half of the 2020 calendar year. Conversely, the Compensation Committee, at the CHAIR/CEO’s recommendation, reduced RPG GOP for a benefit it had received during 2020 related to a reduction in its loan loss allowance for a line of credit product. RPG’s adjusted GOP considered for bonus measurement purposes is summarized inachieved, as measured under the table below.
| | | | |
Description |
|
| (in thousands) | |
| | | | |
RPG GOP, As Reported | | | $ | 32,715 |
| | | | |
Adjustments: | | | | |
| | | | |
Add: Recoveries from 07/01/2020 – 09/30/2020 of previously charged off Easy Advance loans | | | | 4,272 |
| | | | |
Subtract: Impact of net Allowance for Credit Losses decrease on RPG line of credit product from 07/01/2019 - 06/30/2020 | | | | (3,634) |
| | | | |
RPG GOP Adjustments | | | | 638 |
| | | | |
RPG GOP, As Adjusted | | | $ | 33,353 |
| | | | |
RPG GOP, as adjusted, equaled 98% of its “Entry Level” target for the year. In light of the extraordinary nature of these items set forth above, the CHAIR/CEO recommended to the Compensation Committee, and the Compensation Committee concurred, to exercise its discretion to modify the incentive bonus compensation and pay a bonus to this NEO of $210,000 representing 58% of the “Maximum Level” rather than the “Entry Level” payout of 66.7%.
Bonus Incentive Compensation Program AwardPlan, was $41,753,800, and for EVP/CMBO.The Incentive Bonus Compensation Programthis reason, the Entry Level objective for the EVP/CMBO consisted of two separate components for the overall maximum incentive compensation potential for 2020. The total “Maximum Level” Bonus Incentive Compensation Program award for the EVP/CMBO is $275,000, which the EVP/CMBO achieved in 2020.
The first componentPres/RPG was based upon the Company’s Warehouse Lending segment’s attainment of various levels of GOP as described in the table below, with a minimum bonus of $50,000 for Warehouse Lending GOP up to $12.0 million and a sliding scale upward in $25,000 increments up to a maximum bonus of $175,000 for Warehouse Lending GOP of $16.0 million and above. For 2020, Warehouse obtained a GOP of over $16.0 million resulting in the
22
EVP/CMBO receiving an award at the “Maximum Level” of $175,000not met under the Warehouse Lending component of the Bonus Incentive Compensation Program.
| | |
Warehouse GOP | Bonus Potential | |
$0 - $10,999,999 | $ | — |
$11,000,000 - $11,999,999 | $ | 50,000 |
$12,000,000 - $12,999,999 | $ | 75,000 |
$13,000,000 - $13,999,999 | $ | 100,000 |
$14,000,000 - $14,999,999 | $ | 125,000 |
$15,000,000 - $15,999,999 | $ | 150,000 |
$16,000,000 & Above | $ | 175,000 |
This was primarily due to one RPG division, Republic Credit Solutions’ (“RCS”), failure to meet its GOP goal resulting from pandemic-related strategic decisions that limited the growth of the RCS program. The second component focused onbenefit of the Company’s mortgage loan production, withSettlement, and associated expense, was considered an unusual, extraordinary, and nonrecurring item and, accordingly, was not included in the actual bonus awardedRPG GOP.
On October 13, 2022, upon whichever calculation provided the higher bonus award torecommendation of the EVP/CMBO. One potential bonus calculation wasChair/CEO and based on overall Company mortgage loan production and the second potential bonus calculation was based on the mortgage loan production of mortgage loan officers (the “MLO Production”) reporting to the EVP/CMBO and his direct reports, i.e., excluding fromupon the overall Company mortgage loan production any revenue generated byperformance of the banking centers and private banking group.
Forassociates tied to RPG GOP, including Pres/RPG, the Company’s mortgage loan production,Compensation Committee approved a discretionary bonus payout for the following table describesPres/RPG of $112,500 – half of the “EntryEntry Level” “Mid-Level,” and “Maximum Level” for EVP/CMBO’s objective bonus potential under the Bonus Incentive Compensation Program.
| | | |
Payout Level | Total Company Production | Bonus Potential | |
Entry Level | $675,000,000 - $749,999,999 | $ | 50,000 |
Mid-Level | $750,000,000 - $824,999,999 | $ | 75,000 |
Maximum Level | $825,000,000 & Above | $ | 100,000 |
For the Company’s MLO Production, the following table describes the “Entry Level,” “Mid-Level,” and “Maximum Level” for EVP/CMBO’s Bonus Incentive Compensation Program.
| | | |
Payout Level | MLO Production | Bonus Potential | |
Entry Level | $450,000,000 - $549,999,999 | $ | 50,000 |
Mid-Level | $550,000,000 - $649,999,999 | $ | 75,000 |
Maximum Level | $650,000,000 & Above | $ | 100,000 |
For 2020, the Company’s total mortgage loan production was greater than $825.0 million resulting in the EVP/CMBO receiving an award at the “Maximum Level” of $100,000 under this component of the EVP/CMBO’s Bonus Incentive Compensation Program.
Bonus Incentive Compensation Program Award for PRES.The PRES did not receive an incentive bonus compensation award for 2020, as his $325,000 bonus for 2020 was guaranteed as part of his Employment Agreement.
Additional Considerations Regarding the Bonus Incentive Compensation Program. Participants in the Company’s Bonus Incentive Compensation Program described above agree that during their employment or service with Republic and for certain periods following the date of termination of employment or service for whatever reason, they will not (i) solicit or divert or attempt to divert from Republic or its affiliates, any current or targeted customer or business and (ii) directly or indirectly, solicit to employ or engage, offer employment or engagement to, hire, employ, or engage any employees or independent contractors of Republic or any of its affiliates.
The Compensation Committee also considered and determined that the Company’s incentive compensation for all employees follows practices as set forth in applicable regulatory guidance regarding incentive compensation.
Company stock performance is not a component of evaluation for the purpose of NEO cash incentive compensation nor has it typically been considered in determining the amount of equity-based incentives to grant each
23
NEO. Republic’s stock is not actively traded and thus may be subject to market fluctuations beyond the reasonable control of management.
Ultimately, the Compensation Committee believes that reasonable and consistent earnings over time will translate into appropriate and favorable stock performance. The Compensation Committee’s policies are not designed to encourage Republic’s NEOs to manage the Company on a quarter-to-quarter time horizon or even over a one-year time period. Investment in capital improvements, product development, and new market expansion can act to reduce short-term profits while providing for a larger future, longer-term profit potential and/or provide for the long-term soundness and sustainability of the Company’s operations and, thus, its long-term profit potential. All of these factors are considered by the Compensation Committee in its subjective annual evaluation process and deliberations.
The Company’s Stock Incentive Plan and Non-Employee Director and Key Employee Deferred Compensation Plan.Plan
The Company’s primary form of equity-based incentive compensation historically has historically been stock options and restricted stock awards. This formThe Company historically used this type of compensation was historically used by the Company due to previously favorable accounting and tax treatment. Stock option and restricted stock awards also are also granted by most of the Company’s competitors, and the Compensation Committee believes stock option and restricted stock awards have beenare an expectation of business executives in Republic’s marketplace. Despite the ramifications from the adoption of the Financial Accounting Standards Board (“FASB”) ASC Topic 718, the Compensation Committee believes that stock option awards, as well as restricted stock awards, and Performance Stock Unitsperformance stock units (“PSUs”) constitute aserve as favorable retention factortools and enhance the Company’s ability to maintain the employment of its high performing executives. Additionally, Republic’s equity-based incentive agreements provide that for certain periods following the date of termination of employment or service for whatever reason, participants in the Stock Incentive Plan will not (i) solicit or divert or attempt to divert from Republic or its affiliates, any current or targeted customer or business and (ii) directly or indirectly, solicit to employ or engage, offer employment or engagement to, hire, employ, or engage any employees or independent contractors of Republic or any of its affiliates. The Company’s equity-based incentive agreements also have confidentiality requirements which act to protect the Company’s proprietary information. A violation of those provisions allows the Company to require a forfeiture of equity-based incentives or the profits derived from the sale of that stock if sold. All equity-based incentive agreements have a change in control provision providing for immediate vesting of any unexercised stock options, and full vesting of restricted stock if employment ends, other than for cause following a change in control, and PSUs are deemed earned at the target level if a change in control occurs before performance is otherwise measured.
In the view of the CHAIR/Chair/CEO and the Compensation Committee, the significant stock holdings of the CHAIR/Chair/CEO and his related interests provide material executive motivation to not only preserve but to grow shareholder value, particularly long-term shareholder value. Therefore, stock awards have not been traditionally awarded to the CHAIR/Chair/CEO.
Any equity incentives for NEOs are typically recommended to the Compensation Committee by the CHAIR/CEO.Chair/CEO and CEO/Bank. In choosing the date for the grant of equity incentives, the Compensation Committee gives no consideration to market events, as any relationship between the equity incentive date and the price of the Company’s stock on that date is strictly coincidental.
2023 AWARDS UNDER THE COMPANY’S 2015 STOCK INCENTIVE PLAN
The Company’s 2015 Stock Incentive Plan provides for stock option grants and various types of stock awards, including nonqualified stock options (“NQSOs”), shares of restricted stock restricted stock units(“Restricted Shares”), and performance stock units. For 2020,PSUs as part of its long-term incentive program for certain executive officers.
On January 17, 2023, the Compensation Committee approvedawarded Restricted Shares, PSUs, and NQSOs (collectively the “Equity Awards”) to certain NEO equity incentive awards pursuant toexecutive officers, including the 2015 Stock Incentive Plan. CEO/Bank, CFO, and CRO.
The CHAIR/CEO declined to accept any stock incentive awards in 2020. The date forCEO/Bank was granted the strike price of stock options was the close of business on March 10, 2020 at $35.92 per share. In addition, 3,000 nonqualified stock options were awarded to each of the 2020 NEOs, except for the CHAIR/CEO and PRES, whose stock option award is discussed below. Fifty percent of the 2020 stock options become exercisable four (4) years from the issue date and the remaining fifty percent become exercisable five (5) years from the issue date.following:
As contemplated by his 2020 Employment Agreement, the PRES was awarded a nonqualified stock option with a fair market value of approximately $425,000, as determined by the Black Scholes pricing model, that was to be made within 30 days after the effective date of the PRES’s employment and that would fully vest on December 31, 2023. Additionally, per the Employment Agreement, for 2021 and each year thereafter during its term, the PRES will be
24
granted three tranches of awards as a long-term incentive in the following amounts and categories with each award being subject to three-year cliff vesting:
| ● | 4,757 Restricted |
| ● |
| ● |
All options
44 | Republic Bancorp, Inc. |
The CFO and CRO were each granted under the 2020 Employment Agreementfollowing:
| ● | 1,189 PSUs; and |
| ● | 5,376 NQSOs, that are exercisable between December 31, 2025 and December 31, 2026. |
The awarded PSUs are exercisable for a one-year period after the vesting date and all equity awards areexpected to be settled in early 2024 by issuance of Restricted Shares (shares generally subject to a two-year hold on sale from the exercise or vesting date.
At its January 27, 2021 meeting, the Compensation Committee awarded executive officers, including the CFO and PRES/RPG, various equity awards designed to provide long term incentives. One such award was a PSU described above for the PRES. In addition, these officers were awarded 5,000 nonqualified stock options, with three-year vesting that were exercisable for a one-year period after vesting. Performance objectives for the PSUs (including those made under the 2020 Employment Agreement to PRES) are to be measured in early 2022 against threshold, target and maximum performance levels,forfeiture if employment ends before December 31, 2025) based on the Company’s achievement of certain return on average assetassets (“ROAA”) percentages and efficiency ratio metrics as comparedratios. In addition, in order to receive a payout for either the Bank’s peer group published byROAA percentages or efficiency ratios, the Federal Financial Institutions Examination Council (“FFIEC”) inCompany must maintain its December 31, 2021 Uniform Bank Performance Report (“UBPR”). After determination of the earned PSUs under these criteria, each executive will be issued restricted stock in 2022, which will vestranking with its baseline as of December 31, 2023, if employment continues toSeptember 30, 2022 for that date.
Finally, the PRES, CFO, PRES/RPG, and other executive officers, were granted restricted shares on January 27, 2021 withparticular category among a vesting dategroup of December 31, 2023. The Board and Compensation Committee also set stock ownership guidelines for the PRES, CFO, and PRES/RPG requiring them to own two times their base salaries in Company stock within five years from January 2021.selected peers. All shares of stock issued under the PSUs or as restricted stockRestricted Shares must be held by the officer for a period of two years after the vesting date.
Stock Ownership Requirements
The Board and Compensation Committee has set stock ownership guidelines for the CEO/Bank, CFO, Pres/RPG, and CRO requiring them to own a minimum of two (2) times their base salaries in Company stock within five (5) years from January 2021. All shares of stock issued under the PSUs or as Restricted Shares must be held by the officer for a period of two (2) years after the grant date, and all shares issued under the nonqualified stock optionsNQSOs must be held for a period of two (2) years following the exercise date.
Also, onAnti-Hedging Provision
The Company has an insider trading policy that, among other things, prohibits all of its employees (including Executive Officers) and Directors from engaging in hedging transactions in the Company’s shares. Hedging transactions can be accomplished through a number of ways, including through the use of financial instruments such as prepaid variable forward contracts, equity swaps, collars, and exchange funds. Such transactions may permit a Director, Executive Officer, or employee to continue to own Company securities obtained through employee benefit plans or otherwise, but without the full risks and rewards of ownership. When that occurs, the Director, Executive Officer, or employee may no longer have the same objectives as the Company’s other shareholders. Therefore, Directors, Executive Officers, and employees are prohibited from engaging in any hedging transactions.
2022 Change in Control Severance Agreements
On January 27, 2021,2022, in furtherance of its long-term incentive objectives, the Board approved Change in Control Severance Agreements with certain executive officers,Executive Officers, including the Chair/CEO, CEO/Bank, CFO, CRO, and PRES/RPG.Pres/RPG (collectively, “Change in Control Agreements”). The CEO/Bank’s Change in Control Agreement replaces certain terms of the CEO/Bank’s 2020 Employment Agreement. These agreementsChange in Control Agreements include two (2) year noncompete, non-solicitation, and confidentiality clauses that apply whether or not a change in control occurs and whichincorporate restrictive covenants are incorporated into and part of each equity award.
Non-Employee Director and Key Employee Deferred Compensation Plan
To further tie executives’ interests with those of the Company’s shareholders, stock reserved for issuance under the Stock Incentive Plan is also used to cover payment in stock under the Company’s Non-Employee Director and Key Employee Deferred Compensation Plan, which provides for matching of executives’NEOs’ or EOs’ deferrals. Both voluntary deferrals and such matching are deemed to be invested in Class A Common Stock. Cash dividend equivalents with respect to deferred amounts are accumulated and converted into stock equivalents on a quarterly basis.
The Company’s Acquisition Bonus Plan.Plan
In addition to the incentive potential described above, in 2022, certain NEOs may qualifycould have qualified under the Company’s Acquisition Bonus Plan for an additional incentive bonus to be determined by the CHAIR/Chair/CEO and CEO/Bank and approved by the Company’s Compensation Committee relating to Company or Bank acquisitions.
The purpose of the Acquisition Bonus Plan iswas to reward the job performance of associates of the Company, including certain NEOs, who materially participateparticipated in the negotiation, consummation, and transition of an acquisition or merger
| |
2023 PROXY STATEMENT | 45 |
and contributecontributed to the long-term profitability of the acquisitions, whether through an asset purchase, stock purchase, merger, or other corporate transaction. The Company may engage in
During 2022, no acquisitions from time to time, and each acquisition may have a specific bonus incentive program subject to the provisions oftriggered the Acquisition Bonus Plan.
The bonus incentive pool, with respect to each acquisition, will be in an amountPlan, and the Chair/CEO and CEO/Bank did not to exceed $2,000,000, the amount determined by the Company’s CHAIR/CEO within sixty (60) days of the closing of each acquisition and subject to the approval of the Compensation Committee.
25
The determination of the amount of Acquisition Bonus Plan awards that may be paid to any individual will be based on performance criteria as determined by the Compensation Committee. Where applicable, the performance targets may be expressed in terms of attaining a specified level of the particular criteria or the attainment of a percentage increase or decrease in the particular criteria, all as determined by the Compensation Committee. The performance targets may include a threshold level of performance below which no payment will be made, levels of performance at which specified payments will be made, and a maximum level of performance above which no additional payment will be made. Each performance target shall be determined in accordance with GAAP, if applicable, and shall be subject to certification by the Compensation Committee providedrequest that the Compensation Committee shall have the authority to adjust such targets in recognition of extraordinary items or other items that may not be infrequent or unusual, but which may have inconsistent effects on performance.
The Acquisition Bonus Plan is administered by the Compensation Committee. The Compensation Committee has delegated to the CHAIR/CEO of the Company the authority, subject to such terms as the Compensation Committee shall determine, to perform such functions, including administrative functions, except that the Compensation Committee may not delegate authority to an officer or employee to grant a bonus award or otherwise make determinations with respect to the officer or employee to whom the authority is delegated.
Unless otherwise specifically determined by the Compensation Committee or the CHAIR/CEO, an award underre-affirm the Acquisition Bonus Plan is deemed earnedfor 2023, and vested onlythe Compensation Committee terminated the plan at its February 21, 2023 meeting.
The Company’s TRS Transaction Bonus Program
In 2021, the Company adopted an additional bonus program (“TRS Transaction Bonus Program”) for certain associates (“Covered Associates”) in connection with respectthe Company’s entry into an Asset Purchase Agreement on May 13, 2021 (“Asset Purchase Agreement”), through which Green Dot Corporation (“Green Dot”) would purchase substantially all of the assets and operations of the Bank’s TRS business. The TRS Transaction Bonus Program’s payout was structured with two payments: (1) the first bonus payment for one half of the aggregate bonus potential would be triggered by the closing date of the sale transaction and (2) the second bonus payment for one half of the bonus potential would be made one year from the closing date of the sale transaction if the associate remained employed by the Bank at that time.
On May 19, 2021, the Company’s Compensation Committee and Board of Directors approved the TRS Transaction Bonus Program for certain Executive Officers, including three NEOs: the CFO, CRO, and Pres/RPG. The Bonus Program provided the CFO with an aggregate bonus potential of $250,000, the CRO with an aggregate bonus potential of $250,000, and the Pres/RPG with an aggregate bonus potential of $600,000. Green Dot terminated the Asset Purchase Agreement in 2021; accordingly, no payments were made under the TRS Transaction Bonus Program that year.
Subsequently, the Bank filed a lawsuit in the Delaware Court of Chancery (the “Lawsuit”) for breach of contract against Green Dot for Green Dot’s failure to consummate the transaction contemplated in the Asset Purchase Agreement. On June 3, 2022, the Bank and Green Dot entered into a settlement agreement to resolve the Lawsuit. In accordance with the Settlement, on June 6, 2022, Green Dot paid to the Bank $13 million, which was in addition to a participant who remains employed$5 million termination fee that Green Dot paid to the Bank during the first quarter of 2022 in accordance with the Asset Purchase Agreement.
Even though the TRS transaction did not close, the Company awarded the Covered Associates a discretionary bonus for the work they performed on the TRS transaction and the resulting Lawsuit. On June 27, 2022, the Compensation Committee, at the CompanyChair/CEO’s recommendation, exercised its discretion to award this discretionary bonus to certain Executive Officers, including the CFO, CRO, and is in good standing atPres/RPG. Through this discretionary bonus, the time ofCompensation Committee awarded the determination. However, under certain special conditions, this requirement may be subject to waiver byCFO $75,000, the CHAIR/CEO.CRO $75,000, and the Pres/RPG $180,000.
The Company’s Post-Employment Benefits
During 2020, there were no acquisitions that triggered the Acquisition Bonus Plan.
Post-Employment Benefits. As discussed above and further described under the heading “Post-Employment Compensation” in this proxy statement, the Company had Officer Compensation Continuation Agreements with the CHAIR/CEO and the CFO (collectively the “2020 Agreements”) as of December 31, 2020. On January 27, 2021, the Board approvedhas entered into Change in Control Severance Agreements for other executive officers, including the PRES/RPG, EVP/CMBO, and an amendment and restatement to replace the 2020 Agreement for the CFO (collectively, the “2021 Agreements”). The 2020 Agreements provide to an NEO, who is terminated other than for cause or for who leaves for good reason shortly in anticipation or within 24 months following a change in control, a lump sum equal to up to 24 monthswith each of the NEO’s base salary and continued benefits for 24 months, payment for any legal fees incurred to enforce this agreement, and accelerated vesting on all stock options and stock appreciation rights as well as assignment to the executive of any Bank-owned life insurance policy on the NEO’s life.NEOs who served in that capacity during 2022.
The 2021 Agreements provide to an NEO who is terminated other than for cause or who leaves for good reason within 24 months following a change in control, the following:
Payments under the 2021 Agreements are conditioned on the executive signing a release of any claims the executive may have against the Company, Bank or officers or directors.
The PRES is not a party to a 2020 or 2021 Agreement but as part of his Employment Agreement dated April 24, 2020, the PRES is entitled to receive post-employment compensation if his employment is terminated without cause or he resigns for good reason (including a resignation following the failure to appoint him CEO of the Bank before
26
46 | Republic Bancorp, Inc. |
January 1, 2022) before April 1, 2022 or in connection with a changeTable of control that occurs prior to January 1, 2022, as follows:Contents
|
If the PRES attains the CEO position of the Bank on or before January 1, 2022, it is the Bank’s intent to offer a new Change in Control Severance Agreement on terms similar to those described above for the 2021 Agreements for other NEOs.
The Company deems these post-employment severance agreements necessary for the maintenance of sound management and essential to protecting the best interests of the Company and its shareholders. The agreements are intended to encourage the NEOs to remain in the employment of the Company and to continue to perform their assigned duties without distraction in the face of potentially disruptive events that would normally surround a Company change in control. Potential payments and benefits under these arrangements have no bearing on the Compensation Committee’s deliberations regarding all other compensation elements.
COMPENSATION COMMITTEE REPORT
The Compensation Committee of the Company has reviewed and discussed the Compensation Discussion and Analysis required by Item 402(b) of Regulation S-K with management and based on such review and discussions, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this proxy statement.
Members of the Compensation Committee:
Craig A. Greenberg, Chair
Laura M. Douglas
Ernest W. Marshall, Jr.Jr, Chair
George Nichols III
Susan Stout Tamme
Mark A. Vogt
DIRECTOR COMPENSATION
Non-employee Directors of the Company and the Bank received fees of $3,000 for each board meeting attended and fees ranging from $500 to $750, based on the particular committee, for each committee meeting attended. The committee chairperson was paid a fee of $1,000 to $1,500 per committee meeting attended. All Company and Bank non-employee Directors who were directors as of its regularly scheduled March 18, 2020 board meeting were each awarded 300 shares of Class A Common Stock on the day of that meeting. In addition, Heather V. Howell, Susan Stout Tamme, and Mark A. Vogt were each awarded a one-time fee of $10,000 for their participation in the recruitment and hiring process for the Bank’s new President, Logan M. Pichel.
At its November 18, 2020 meeting, the Board voted to increase Director compensation. As of January 1, 2021, the Directors will receive the following:
On occasion, brief, typically single-issue meetings are held for which there is no compensation.
27
| |
2023 PROXY STATEMENT | 47 |
DIRECTOR COMPENSATION
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
(a) | | (b) | | (c) | | (d) | | (e) | | (f) | | (g) | | (h) | |
|
| Fees |
| Stock |
| Option |
| Non-Equity Incentive Plan |
| Change in Pension Value and Non-Qualified Deferred |
| All Other |
| Total | |
Name (1) | | ($) | | ($) | | ($) | | ($) | | ($) | | ($) | | ($) |
|
Ronald F. Barnes | | 35,750 | | 9,153 | | — | | — | | — | | — | | 44,903 | |
Campbell P. Brown | | 15,000 | | 9,153 | | — | | — | | — | | — | | 24,153 | |
Laura M. Douglas | | 32,000 | | 9,153 | | — | | — | | — | | — | | 41,153 | |
David P. Feaster | | 22,000 | | 9,153 | | — | | — | | — | | 69,526 | | 100,679 | |
Craig A. Greenberg | | 31,250 | | 9,153 | | — | | — | | — | | — | | 40,403 | |
Heather V. Howell | | 35,250 | | 9,153 | | — | | — | | — | | — | | 44,403 | |
Ernest W. Marshall, Jr. | | 23,625 | | 9,153 | | — | | — | | — | | — | | 32,778 | |
William P. Mulloy, II | | 24,000 | | 9,153 | | — | | — | | — | | — | | 33,153 | |
George Nichols, III | | 7,500 | | — | | — | | — | | — | | — | | 7,500 | |
W. Kenneth Oyler, III | | 26,750 | | 9,153 | | — | | — | | — | | — | | 35,903 | |
Michael T. Rust | | 26,000 | | 9,153 | | — | | — | | — | | — | | 35,153 | |
R. Wayne Stratton | | 10,500 | | 9,153 | | — | | — | | — | | — | | 19,653 | |
Susan Stout Tamme | | 38,000 | | 9,153 | | — | | — | | — | | — | | 47,153 | |
Mark A. Vogt | | 37,750 | | 9,153 | | — | | — | | — | | — | | 46,903 | |
| | | | | | | | | | | | | | | |
|
28
CERTAIN INFORMATION AS TO MANAGEMENT
The following table contains information concerning the compensation received by Republic’s CHAIR/the Company’s Chair/CEO, its CFO, and its other three most highly compensated EOsExecutive Officers for the fiscal year ended December 31, 2020:2022:
2020
48 | Republic Bancorp, Inc. |
2022 SUMMARY COMPENSATION TABLE
| | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | |
(a) |
| (b) |
| (c) |
| (d) |
| (e) |
| (f) |
| (g) |
| (h) |
| (i) |
| (j) |
| | | | | | | | | | | | | | Change in | | | | |
| | | | | | | | | | | | | | Pension | | | | |
| | | | | | | | | | | | | | Value and | | | | |
| | | | | | | | | | | | Non-Equity | | Non-Qualified | | | | |
| | | | | | | | | | | | Incentive Plan | | Deferred | | All Other | | |
| | | | | | | | Stock | | Option | | Compensation | | Compensation | | Compensation | | |
Name and Principal | | | | Salary | | Bonus (1) | | Awards (2) | | Awards (2) | | (3) | | Earnings (4) | | (5) | | Total |
Position | | Year | | ($) | | ($) | | ($) | | ($) | | ($) | | ($) | | ($) | | ($) |
| | | | | | | | | | | | | | | | | | |
Steven E. Trager (Chair/CEO) | | 2022 | | 441,657 | | 40,000 | | — | | — | | 280,000 | | — | | 42,695 | | 804,352 |
| | 2021 | | 434,808 | | 187,500 | | — | | — | | — | | — | | 41,742 | | 664,050 |
| | 2020 | | 425,000 | | — | | — | | — | | 175,000 | | — | | 41,217 | | 641,217 |
Logan M. Pichel (CEO/Bank) | | 2022 | | 650,000 | | 50,000 | | 556,629 | | 202,694 | | 350,000 | | — | | 20,544 | | 1,829,867 |
| | 2021 |
| 650,000 |
| 250,000 |
| 519,057 |
| 184,439 |
| — |
| — |
| 16,944 |
| 1,620,440 |
| | 2020 |
| 350,000 |
| 325,000 |
| 25,000 |
| 424,997 |
| — |
| — |
| 88,099 |
| 1,213,096 |
Kevin D. Sipes (CFO) | | 2022 |
| 364,341 |
| 92,500 |
| 108,560 |
| 50,668 |
| 122,500 |
| — |
| 24,644 |
| 763,213 |
| | 2021 |
| 358,958 |
| 113,750 |
| 122,658 |
| 33,863 |
| — |
| — |
| 24,044 |
| 653,273 |
| | 2020 |
| 354,055 |
| — |
| 25,000 |
| 12,416 |
| 122,500 |
| — |
| 23,996 |
| 537,967 |
William R. Nelson (Pres/RPG) | | 2022 |
| 394,935 |
| 292,500 |
| 108,560 |
| 50,668 |
| — |
| — |
| 14,087 |
| 860,750 |
| | 2021 |
| 384,504 |
| 60,000 |
| 122,658 |
| 33,863 |
| 315,000 |
| — |
| 13,401 |
| 929,426 |
| | 2020 |
| 382,538 |
| — |
| 25,000 |
| 12,416 |
| 210,000 |
| — |
| 13,208 |
| 643,162 |
John T. Rippy (CRO) | | 2022 |
| 337,269 |
| 92,500 |
| 108,560 |
| 50,668 |
| 122,500 |
| — | | 20,088 |
| 731,585 |
| | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
(a) | | (b) | | (c) | | (d) | | (e) | | (f) | | (g) | | (h) | | (i) | | (j) | |
Name and Principal |
| |
| Salary (1) |
| Bonus (2) |
| Stock |
| Option |
| Non-Equity |
| Change in |
| All Other |
| Total | |
Position | | Year | | ($) | | ($) | | ($) | | ($) | | ($) | | ($) | | ($) | | ($) |
|
| | | | | | | | | | | | | | | | | | | |
Steven E. Trager (CHAIR/CEO) | | 2020 | | 425,000 | | — | | — | | — | | 175,000 | | — | | 39,717 | | 639,717 | |
| | 2019 | | 394,000 | | — | | — | | — | | 157,500 | | — | | 40,073 | | 591,573 | |
| | 2018 | | 382,502 | | — | | — | | — | | 185,000 | | — | | 39,830 | | 607,332 | |
| | | | | | | | | | | | | | | | | | | |
Logan M. Pichel (PRES) | | 2020 | | 350,000 | | 325,000 | | — | | 424,997 | | — | | — | | 112,224 | | 1,212,221 | |
| | 2019 | | — | | — | | — | | — | | — | | — | | — | | — | |
| | 2018 | | — | | — | | — | | — | | — | | — | | — | | — | |
| | | | | | | | | | | | | | | | | | | |
Kevin D. Sipes (CFO) | | 2020 | | 354,055 | | — | | 12,416 | | — | | 122,500 | | — | | 47,496 | | 536,467 | |
| | 2019 | | 343,743 | | — | | — | | — | | 98,000 | | — | | 48,243 | | 489,986 | |
| | 2018 | | 333,731 | | — | | 114,900 | | — | | 125,000 | | — | | 39,942 | | 613,573 | |
| | | | | | | | | | | | | | | | | | | |
William R. Nelson (PRES/RPG) | | 2020 | | 382,538 | | — | | 12,416 | | — | | 210,000 | | — | | 37,128 | | 642,082 | |
| | 2019 | | 378,750 | | — | | — | | — | | 270,000 | | — | | 37,781 | | 686,531 | |
| | 2018 | | 292,013 | | — | | 574,900 | | — | | 200,000 | | — | | 21,821 | | 1,088,734 | |
| | | | | | | | | | | | | | | | | | | |
Juan M. Montano (EVP/CMBO) | | 2020 | | 326,863 | | — | | 12,416 | | — | | 275,000 | | — | | 37,896 | | 652,175 | |
| | 2019 | | 317,343 | | — | | — | | — | | 100,000 | | — | | 38,551 | | 455,894 | |
| | 2018 | | 309,000 | | — | | 114,900 | | — | | 75,000 | | — | | 30,342 | | 529,242 | |
| | | | | | | | | | | | | | | | | | | |
| (1) | Amounts reflect the following 2022 discretionary bonuses: |
| a) | As discussed in the “2022 Bonus Incentive Program Award for Chair/CEO, CEO/Bank, CFO, and CRO” section of the “Compensation Discussion and Analysis” section of this Proxy Statement, the Company awarded all associates tied to the Total Company GOP, including the Chair/CEO, CEO/Bank, CFO, and CRO, a discretionary bonus of an additional 10% (for a total of 80% of their bonus potential under the Bonus Incentive Compensation Program). The amounts shown above represent |
| As discussed in the |
| c) | As discussed in “The Company’s TRS Transaction Bonus Program” section of the “Compensation Discussion and Analysis” section of this Proxy Statement, certain associates, including the CFO, CRO, and Pres/RPG received the following discretionary bonuses in connection with their work on the TRS transaction and ensuing Lawsuit. The amounts shown above include the following discretionary bonuses for the CFO ($75,000), CRO ($75,000), and Pres/RPG ($180,000). |
| |
2023 PROXY STATEMENT | 49 |
| (2) | Amounts shown represent the aggregate grant date fair values computed in accordance with Accounting Standards Codification, Topic 718. See table “Grants of Plan Based Awards During 2022” in this Proxy Statement for a detail listing for each award grant and its corresponding fair value as of the date of grant. For a discussion of the assumptions used in determining these values, see Note17 of the financial statements in the |
In addition, the “Stock Awards” column also includes the $25,000 fair value of deferred compensation matches in 2022 for each of the CEO/Bank, CFO, Pres/RPG, and CRO. These deferred compensation matches were previously categorized under the “All Other Compensation” column of this table in years’ past. As a result of the new Pay Versus Performance table added to this proxy statement this year, the Company believes this Company match would be more appropriately reflected in the Stock Awards column on a go-forward basis, with any adjustments to their fair values at year-end being reflected in the Pay Versus Performance table. All such Company matches presented in this proxy statement for 2020 and 2021 have been reclassified into the Stock Awards column, as well, for the periods in which they occurred.
| (3) | The amounts in column (g)reflect incentive compensation earned during the coveredyear and paid on the |
| (4) | Republic does not provide above-market or preferential earnings on deferred compensation. See the |
29
| | | | | | | | | | | | | | | |
|
| 401(k) Matching |
| Deferred Compensation Match |
| Life Insurance |
| Club |
| Auto Allowance or |
| Relocation Stipend (a) |
| Total |
|
Name | | ($) | | ($) | | ($) | | ($) | | ($) | | ($) | | ($) | |
Steven E. Trager (CHAIR/CEO) | | 11,500 | | — | | 1,396 | | 17,221 | | 9,600 | | — | | 39,717 | |
Logan M. Pichel (PRES) | | 11,500 | | 25,000 | | 724 | | — | | — | | 75,000 | | 112,224 | |
Kevin D. Sipes (CFO) | | 11,500 | | 25,000 | | 1,396 | | — | | 9,600 | | — | | 47,496 | |
William R. Nelson (PRES/RPG) | | 11,500 | | 25,000 | | 628 | | — | | — | | — | | 37,128 | |
Juan M. Montano (EVP/CMBO) | | 11,500 | | 25,000 | | 1,396 | | — | | — | | — | | 37,896 | |
| | | | | | | | | | | | | | | |
(a) Amount reflects a Relocation Stipend required by Mr. Pichel’s 2020 Employment Agreement.
2020 PAY RATIO DISCLOSURE
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
(a) | | (b) | | (c) | | (d) | | (e) | | (f) | | (g) | | (h) | | (i) | | (j) | |
| | | | | | | | | | | | | | Change in Pension | | | | | |
| | | | | | | | | | | | | | Value and | | | | | |
| | | | | | | | | | | | | | Non-Qualified | | | | | |
| | | | | | | | | | | | Non-Equity | | Deferred | | | | | |
| | | | | | | | Stock | | Option | | Incentive Plan | | Compensation | | All Other | | | |
Name and Principal | | | | Salary | | Bonus | | Awards | | Awards | | Compensation (1) | | Earnings | | Compensation (2) | | Total | |
Position |
| Year |
| ($) |
| ($) |
| ($) |
| ($) |
| ($) |
| ($) |
| ($) |
| ($) | |
| | | | | | | | | | | | | | | | | | | |
Steven E. Trager (CHAIR/CEO) | | 2020 | | 425,000 | | — | | — | | — | | 175,000 | | — | | 39,717 | | 639,717 | |
| | | | | | | | | | | | | | | | | | | |
Median Employee | | 2020 | | 50,960 | | — | | — | | — | | 1,692 | | — | | 2,435 | | 55,087 | |
| | | | | | | | | | | | | | | | | | | |
| (5) | The |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| | | | | | | | | | Auto Allowance or | | | |
| | | | Deferred | | | | | | Personal Use of | | | |
| | 401(k) Matching | | Compensation | | Life Insurance | | Club | | Company Owned | | | |
| | Contributions | | Match | | Policies | | Memberships | | Vehicles | | Total | |
Name |
| ($) |
| ($) |
| ($) |
| ($) |
| ($) |
| ($) | |
| | | | | | | | | | | | | |
Steven E. Trager (CHAIR/CEO) | | 11,500 | | — | | 1,396 | | 17,221 | | 9,600 | | 39,717 | |
Median Employee | | 2,294 | | — | | 141 | | — | | — | | 2,435 | |
| | | | | | | | | | | | | |
For 2022, the amounts in column (i)include the following:
| | | | | | | | | | | | |
|
| |
| |
| |
| |
| |
| |
| | | | | | | | Auto Allowance or | | | | |
| | | | | | | | Personal Use of | | | | |
| | 401(k) Matching | | Life Insurance | | Club | | Company Owned | | | | |
| | Contributions | | Policies | | Memberships | | Vehicles | | Parking | | Total |
Name |
| ($) |
| ($) |
| ($) |
| ($) |
| ($) |
| ($) |
| | | | | | | | | | | | |
Steven E. Trager (Chair/CEO) |
| 12,200 |
| 1,344 |
| 18,051 |
| 9,600 |
| 1,500 |
| 42,695 |
Logan M. Pichel (CEO/Bank) |
| 12,200 |
| 1,344 |
| 5,500 |
| — |
| 1,500 |
| 20,544 |
Kevin D. Sipes (CFO) |
| 12,200 |
| 1,344 |
| — |
| 9,600 |
| 1,500 |
| 24,644 |
William R. Nelson (Pres/RPG) |
| 12,200 |
| 807 |
| — |
| — |
| 1,080 |
| 14,087 |
John T. Rippy (CRO) |
| 12,200 |
| 1,344 |
| 5,044 |
| — |
| 1,500 |
| 20,088 |
Narrative Discussion of the Summary Compensation Table
The Company determinedSummary Compensation Table lists the median employee as ofcompensation for the Company’s Chair/CEO, its CFO, and its other three most highly compensated Executive Officers for the fiscal year ended December 31, 2020.2022. The CHAIR/CEO’s total annual compensation is approximately twelve (12) times larger thanmaterial terms of the median employee’s annual total compensation.pay elements included in the Summary Compensation Table are described above in the “Compensation Discussion and Analysis” section of this Proxy Statement.
30
50 | Republic Bancorp, Inc. |
GRANTS OF PLAN BASED AWARDS DURING 20202022
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | All Other | | All Other | | | | |
| | | | | | | | | | | | | | | | | | Stock | | Option | | | | |
| | | | | | | | | | | | | | | | | | Awards: | | Awards: | | Exercise | | Full Grant |
| | | | | | | | | | | | | | | | | | Number | | Number of | | or Base | | Date |
Named | | | | | | | | | | | | | | | | | | of Shares | | Securities | | Price of | | Fair |
Executive | | | | | | Estimated Future Payouts Under Non- | | Estimated Future Payouts Under | | of Stock | | Underlying | | Option | | Value of | ||||||||
Officer | | Grant Date | | Grant Type | | Equity Incentive Plan Awards | | Equity Incentive Plan Awards | | or Units | | Options | | Awards | | Awards | ||||||||
| | | | | | Threshold | | Target | | Maximum | | Threshold | | Target | | Maximum | |
| |
| |
| |
|
| | | |
| | ($) | | ($) | | ($) | | (#) | | (#) | | (#) | | (#) | | (#) | | ($/sh) | | ($) |
(a) |
| (b) |
|
|
| (c) |
| (d) |
| (e) |
| (f) |
| (g) |
| (h) |
| (i) |
| (j) |
| (k) |
| (l) |
| | | | | | | | | | | | | | | | | | | | | | | | |
Steven E. Trager (Chair/CEO) |
| 01/01/2022 |
| Annual Incentive |
| (1) |
| 280,000 |
| 400,000 |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
Logan M. Pichel (CEO/Bank) |
| 01/01/2022 |
| Annual Incentive |
| (1) |
| 350,000 |
| 500,000 |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
Logan M. Pichel (CEO/Bank) |
| 01/18/2022 |
| Stock Option |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| 19,474 |
| 51.39 |
| 202,694 |
Logan M. Pichel (CEO/Bank) |
| 01/18/2022 |
| Restricted Stock Award |
| — |
| — |
| — |
| — |
| — |
| — |
| 3,839 |
| — |
| — |
| 197,286 |
Logan M. Pichel (CEO/Bank) |
| 01/18/2022 |
| Performance Stock Unit |
| — |
| — |
| — |
| 3,839 |
| 3,839 |
| 3,839 |
| — |
| — |
| — |
| 197,286 |
Logan M. Pichel (CEO/Bank) |
| 01/18/2022 | | Restricted Stock Award |
| — |
| — |
| — |
| — |
| — |
| — |
| 2,667 |
| — |
| — |
| 137,057 |
Kevin D. Sipes (CFO) |
| 01/01/2022 |
| Annual Incentive |
| (1) |
| 122,500 |
| 175,000 |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
Kevin D. Sipes (CFO) |
| 01/18/2022 |
| Stock Option |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| 4,868 |
| 51.39 |
| 50,668 |
Kevin D. Sipes (CFO) |
| 01/18/2022 |
| Performance Stock Unit |
| — |
| — |
| — |
| 959 |
| 959 |
| 959 |
| — |
| — |
| — |
| 49,283 |
Kevin D. Sipes (CFO) |
| 01/18/2022 |
| Restricted Stock Award |
| — |
| — |
| — |
| — |
| — |
| — |
| 667 |
| — |
| — |
| 34,277 |
William R. Nelson (Pres/RPG) |
| 01/18/2022 |
| Stock Option |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| 4,868 |
| 51.39 |
| 50,668 |
William R. Nelson (Pres/RPG) |
| 01/18/2022 |
| Performance Stock Unit |
| — |
| — |
| — |
| 959 |
| 959 |
| 959 |
| — |
| — |
| — |
| 49,283 |
William R. Nelson (Pres/RPG) |
| 01/18/2022 |
| Restricted Stock Award |
| — |
| — |
| — |
| — |
| — |
| — |
| 667 |
| — |
| — |
| 34,277 |
William R. Nelson (Pres/RPG) |
| 11/01/2022 |
| Annual Incentive |
| (1) |
| 225,000 |
| 375,000 |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
John T. Rippy (CRO) |
| 01/01/2022 |
| Annual Incentive |
| (1) |
| 122,500 |
| 175,000 |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
John T. Rippy (CRO) | | 01/18/2022 | | Stock Option | | — |
| — |
| — |
| — |
| — |
| — |
| — |
| 4,868 |
| 51.39 |
| 50,668 |
John T. Rippy (CRO) | | 01/18/2022 | | Performance Stock Unit | | — |
| — |
| — |
| 959 |
| 959 |
| 959 |
| — |
| — |
| — |
| 49,283 |
John T. Rippy (CRO) |
| 01/18/2022 |
| Restricted Stock Award |
| — |
| — |
| — |
| — |
| — |
| — |
| 667 |
| — |
| — |
| 34,277 |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | All Other | | All Other | | | | | |
| | | | | | | | | | | | | | | | | | Stock | | Option | | | | | |
| | | | | | | | | | | | | | | | | | Awards: | | Awards: | | | | | |
| | | | | | | | | | | | | | | | | | Number of | | Number of | | Exercise or | | Full Grant | |
| | | | | | | | | | | | | | | | | | Shares of | | Securities | | Base Price | | Date Fair | |
| | | | | | Estimated Future Payouts Under Non- | | Estimated Future Payouts Under Equity | | Stock or | | Underlying | | of Option | | Value of | | ||||||||
Named Executive Officer |
| Grant Date |
| Grant Type |
| Equity Incentive Plan Awards | | Incentive Plan Awards | | Units | | Options | | Awards | | Awards |
| ||||||||
| | | | | | Threshold |
| Target |
| Maximum |
| Threshold |
| Target |
| Maximum |
| |
| |
| |
| | |
| | | | | | ($) | | ($) | | ($) | | ($) | | ($) | | ($) | | (#) | | (#) | | ($/sh) | | ($) | |
(a) | | (b) | | | | (c) | | (d) | | (e) | | (f) | | (g) | | (h) | | (i) | | (j) | | (k) | | (l) | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Steven E. Trager (CHAIR/CEO) | | 01/01/2020 | | Annual Incentive | | (1) | | 175,000 | | 250,000 | | — | | — | | — | | — | | — | | — | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Logan M. Pichel (PRES) | | 06/15/2020 | | Stock Option | | (1) | | — | | — | | — | | — | | — | | — | | 74,995 | | 32.61 | | 2,445,587 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Kevin D. Sipes (CFO) | | 01/01/2020 | | Annual Incentive | | (1) | | 98,000 | | 140,000 | | — | | — | | — | | — | | — | | — | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Kevin D. Sipes (CFO) | | 03/10/2020 | | Stock Option | | (1) | | — | | — | | — | | — | | — | | — | | 3,000 | | 35.92 | | 107,760 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
William R. Nelson (PRES/RPG) | | 03/10/2020 | | Stock Option | | (1) | | — | | — | | — | | — | | — | | — | | 3,000 | | 35.92 | | 107,760 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
William R. Nelson (PRES/RPG) | | 11/01/2020 | | Annual Incentive | | (1) | | 90,000 | | 150,000 | | — | �� | — | | — | | — | | — | | — | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
William R. Nelson (PRES/RPG) | | 11/01/2020 | | Annual Incentive | | (1) | | 135,000 | | 225,000 | | — | | — | | — | | — | | — | | — | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Juan M. Montano (EVP/CMBO) | | 01/01/2020 | | Annual Incentive | | (1) | | — | | 175,000 | | — | | — | | — | | — | | — | | — | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Juan M. Montano (EVP/CMBO) | | 01/01/2020 | | Annual Incentive | | (1) | | — | | 100,000 | | — | | — | | — | | — | | — | | — | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
Juan M. Montano (EVP/CMBO) | | 03/10/2020 | | Stock Option | | (1) | | — | | — | | — | | — | | — | | — | | 3,000 | | 35.92 | | 107,760 | |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| (1) | Represents target and maximum payout levels for awards granted under the NEO Bonus Incentive Compensation Program for |
31
| |
2023 PROXY STATEMENT | 51 |
OUTSTANDING EQUITY AWARDS ATAS OF DECEMBER 31, 20202022
| | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | |
Option Awards | | Stock Awards | ||||||||||||||||
(a) | | (b) | | (c) | | (d) | | (e) | | (f) | | (g) | | (h) | | (i) | | (j) |
| | | | | | | | | | | | | | | | | | Equity |
| | | | | | | | | | | | | | | | Equity | | Incentive |
| | | | | | Equity | | | | | | | | | | Incentive | | Plan |
| | | | | | Incentive | | | | | | | | | | Plan | | Awards: |
| | | | | | Plan | | | | | | Number | | | | Awards: | | Market or |
| | | | | | Awards: | | | | | | of Shares | | Market | | Number of | | Payout Value |
| | Number of | | Number of | | Number of | | | | | | or Units | | Value of | | Unearned | | of Unearned |
| | Securities | | Securities | | Securities | | | | | | of Stock | | Shares or | | Shares, Units | | Shares, Units |
| | Underlying | | Underlying | | Underlying | | | | | | That | | Units of | | or Other | | or Other |
| | Unexercised | | Unexercised | | Unexercised | | Option | | | | Have | | Stock That | | Rights That | | Rights That |
| | Options | | Options (1) | | Unearned | | Exercise | | Option | | Not | | Have Not | | Have Not | | Have Not |
| | Exercisable | | Unexercisable | | Options | | Price | | Expiration | | Vested | | Vested | | Vested | | Vested |
Named Executive Officer |
| (#) |
| (#) |
| (#) |
| ($) |
| Date |
| (#)(2) |
| ($) |
| (#) |
| ($) |
| | | | | | | | | | | | | | | | | | |
Steven E. Trager (Chair/CEO) |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
Logan M. Pichel (CEO/Bank) |
| — |
| 74,995 |
| — |
| 32.61 |
| 12/31/2024 |
| 14,778 |
| 604,716 |
| — |
| — |
|
| — |
| 32,257 |
| — |
| 35.68 |
| 12/31/2024 | | | | | | | | |
|
| — |
| 19,474 |
| — |
| 51.39 |
| 12/31/2025 | | | | | | | | |
Kevin D. Sipes (CFO) |
| — |
| 5,000 |
| — |
| 36.29 |
| 12/31/2024 |
| 5,000 |
| 204,600 |
| — |
| — |
|
| — |
| 1,500 |
| — |
| 35.92 |
| 03/09/2025 | | | | | | | | |
|
| — |
| 4,868 |
| — |
| 51.39 |
| 12/31/2025 | | | | | | | | |
|
| — |
| 1,500 |
| — |
| 35.92 |
| 03/09/2026 | | | | | | | | |
William R. Nelson (Pres/RPG) |
| — |
| 5,000 |
| — |
| 36.29 |
| 12/31/2024 |
| 5,000 |
| 204,600 |
| — |
| — |
|
| — |
| 1,500 |
| — |
| 35.92 |
| 03/09/2025 | | | | | | | | |
|
| — |
| 4,868 |
| — |
| 51.39 |
| 12/31/2025 | | | | | | | | |
|
| — |
| 1,500 |
| — |
| 35.92 |
| 03/09/2026 | | | | | | | | |
John T. Rippy (CRO) |
| — |
| 5,000 |
| — |
| 36.29 |
| 12/31/2024 |
| 5,000 |
| 204,600 |
| — |
| — |
| | — | | 1,500 | | — | | 35.92 | | 03/09/2025 | | | | | | | | |
| | — | | 4,868 | | — | | 51.39 | | 12/31/2025 | | | | | | | | |
|
| — |
| 1,500 |
| — |
| 35.92 |
| 03/09/2026 | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
Option Awards | | Stock Awards | | ||||||||||||||||
(a) | | (b) | | (c) | | (d) | | (e) | | (f) | | (g) | | (h) | | (i) | | (j) | |
| | | | | | | | | | | | | | | | | | Equity | |
| | | | | | | | | | | | | | | | Equity | | Incentive Plan | |
| | | | | | | | | | | | | | | | Incentive Plan | | Awards: | |
| | | | | | Equity Incentive | | | | | | Number | | | | Awards: | | Market or | |
| | | | | | Plan Awards: | | | | | | of Shares | | Market | | Number of | | Payout Value | |
| | Number of | | Number of | | Number of | | | | | | or Units | | Value of | | Unearned | | of Unearned | |
| | Securities | | Securities | | Securities | | | | | | of Stock | | Shares or | | Shares, Units | | Shares, Units | |
| | Underlying | | Underlying | | Underlying | | | | | | That | | Units of | | or Other | | or Other | |
| | Unexercised | | Unexercised | | Unexercised | | Option | | | | Have | | Stock That | | Rights That | | Rights That | |
| | Options | | Options (1) | | Unearned | | Exercise | | Option | | Not | | Have Not | | Have Not | | Have Not | |
| | Exercisable |
| Unexercisable |
| Options |
| Price |
| Expiration |
| Vested |
| Vested |
| Vested |
| Vested | |
Named Executive Officer |
| (#) |
| (#) |
| (#) |
| ($) |
| Date |
| (#)(2) |
| ($) |
| (#) |
| ($) | |
| | | | | | | | | | | | | | | | | | | |
Steven E. Trager (CHAIR/CEO) | | — | | — | | — | | — | | — | | — | | — | | — | | — | |
| | | | | | | | | | | | | | | | | | | |
Logan M. Pichel (PRES) | | — | | 74,995 | | — | | 32.61 | | 12/31/2024 | | — | | — | | — | | — | |
| | | | | | | | | | | | | | | | | | | |
Kevin D. Sipes (CFO) | | 2,750 | | — | | — | | 24.47 | | 04/24/2021 | | 3,000 | | 108,210 | | — | | — | |
| | — | | 1,500 | | — | | 35.92 | | 03/09/2025 | | | | | | | | | |
| | — | | 1,500 | | — | | 35.92 | | 03/09/2026 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
William R. Nelson (PRES/RPG) | | 2,750 | | — | | — | | 24.47 | | 04/24/2021 | | 3,000 | | 108,210 | | — | | — | |
| | — | | 1,500 | | — | | 35.92 | | 03/09/2025 | | | | | | | | | |
| | — | | 1,500 | | — | | 35.92 | | 03/09/2026 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
Juan M. Montano (EVP/CMBO) | | 2,750 | | — | | — | | 24.47 | | 04/24/2021 | | 3,000 | | 108,210 | | — | | — | |
| | 2,500 | | — | | — | | 25.19 | | 06/12/2021 | | | | | | | | | |
| | — | | 1,500 | | — | | 35.92 | | 03/09/2025 | | | | | | | | | |
| | — | | 1,500 | | — | | 35.92 | | 03/09/2026 | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
| | ||||||||||||||||||
| (1) | The first exercisable date for each option listed by expiration date is as follows: |
|
|
|
|
| Exercisable | | Expiration |
|
|
|
|
|
|
|
|
|
|
|
|
| 12/31/2023 | | 12/31/2024 |
| 03/10/2024 | | 03/09/2025 |
| | 12/31/2025 | |
03/10/2025 | | 03/09/2026 | |
|
|
|
|
| (2) | Includes 3,000 restricted shares awarded to |
Includes 5,605 restricted shares awarded to CEO/Bank on January 4, 2021 that vest on December 31, 2023, and 2,667 restricted shares awarded to CEO/Bank and 1,333 restricted shares awarded to each of Pres/RPG, CFO, and CRO on January 27, 2021 that vest on December 31, 2023.
Includes 6,506 restricted shares awarded to CEO/Bank and 667 restricted shares awarded to each of Pres/RPG, CFO, and CRO on January 18, 2022 that vest on December 31, 2024.
52 | Republic Bancorp, Inc. |
OPTION EXERCISES AND STOCK VESTED DURING 20202022
| | | | | | | | | |
| | | | | | | | | |
| | Option Awards | | Stock Awards | | ||||
(a) | | (b) | | (c) | | (d) | | (e) | |
| | Number of Shares | | Value Realized | | Number of Shares | | Value Realized | |
|
| Acquired on Exercise |
| on Exercise |
| Acquired on Vesting |
| on Vesting | |
Named Executive Officer | | (#) | | ($) | | (#) | | ($) | |
| | | | | | | | | |
Steven E. Trager (CHAIR/CEO) | | — | | — | | — | | — | |
Logan M. Pichel (PRES) | | — | | — | | — | | — | |
Kevin D. Sipes (CFO) | | 2,750 | | 18,398 | | 2,500 | | 94,350 | |
William R. Nelson (PRES/RPG) | | 2,750 | | 47,740 | | 2,000 | | 75,480 | |
Juan M. Montano (EVP/CMBO) | | — | | — | | 3,250 | | 115,755 | |
| | | | | | | | | |
| | | | | | | | |
| | | | | | | | |
| Option Awards | Stock Awards | ||||||
(a) | | (b) | (c) | (d) | (e) | |||
| | Number of Shares | | Value Realized | | Number of Shares | | Value Realized |
| | Acquired on Exercise | | on Exercise | | Acquired on Vesting | | on Vesting |
Named Executive Officer | | (#) | | ($) | | (#) | | ($) |
| | | | | | | | |
Steven E. Trager (Chair/CEO) | — | — | — | — | ||||
Logan M. Pichel (CEO/Bank) | — | — | — | — | ||||
Kevin D. Sipes (CFO) | — | — | — | — | ||||
William R. Nelson (Pres/RPG) | — | — | — | — | ||||
John T. Rippy (CRO) | — | — | — | — | ||||
32
| |
2023 PROXY STATEMENT | 53 |
NONQUALIFIED DEFERRED COMPENSATION
The Compensation Committee may designate key employees as eligible to participate in the Non-Employee Director and Key Employee Deferred Compensation Plan (the “Deferred Plan”) and did so for the first time in 2018. Amounts deferred in the plan are deemed to be invested in Class A Common Stock. Cash dividend equivalents with respect to deferred amounts are accumulated and converted into stock equivalents on a quarterly basis. Key employee participants may elect to defer up to 50% of their base salary for an initial period of five years from the beginning of the year in which the deferral is made, with the ability to extend the deferral infor additional five-year periods. The Company provides a matching program for key employee participants whereby the Company will make a matching contribution equal to up to 100% of the amount of compensation deferred by such participant under the plan, subject to an annual dollar cap established annually by the Compensation Committee. The matching amount is subject to forfeiture until it vests on December 31st of the year that is five years from the beginning of the year that the Company match is made, subject to acceleration of vesting upon death, disability, or a change in control.
The “Nonqualified Deferred Compensation” table below shows the 20202022 account activity for each NEO and includes each participating NEO’s contributions, Company matching contributions, earnings, withdrawals, and distributions and the aggregate balance of each NEO’s total deferral account as of December 31, 2020.2022.
| | | | | | | | | | |
| | | | | | | | | | |
(a) |
| (b) |
| (c) |
| (d) |
| (e) |
| (f) |
| | | | | | | | Aggregate | | |
| | Executive | | Registrant | | Aggregate | | Withdrawals/ | | Aggregate |
| | Contributions (1) | | Contributions (2) | | Earnings | | Distributions | | Balance (3) |
Named Executive Officer |
| ($) |
| ($) |
| ($) |
| ($) |
| ($) |
| | | | | | | | | | |
Steven E. Trager (Chair/CEO) |
| — |
| — |
| — |
| — |
| — |
Logan M. Pichel (CEO/Bank) |
| 25,000 |
| 25,000 |
| (24,820) |
| — |
| 159,823 |
Kevin D. Sipes (CFO) |
| 25,000 |
| 25,000 |
| (42,159) |
| — |
| 243,456 |
William R. Nelson (Pres/RPG) |
| 25,000 |
| 25,000 |
| (38,733) |
| — |
| 226,930 |
John T. Rippy (CRO) |
| 25,000 |
| 25,000 |
| (42,213) |
| — |
| 243,604 |
| | | | | | | | | | | | | |
| | | | | | | | ||||||
(a) | | | | (b) | | (c) | | (d) | | (e) | | (f) | |
| | | | | | | | | | | | | |
| | | | | | | | | | Aggregate | | | |
| |
| | Executive |
| Registrant |
| Aggregate |
| Withdrawals/ |
| Aggregate | |
| | | | Contributions (1) | | Contributions (2) | | Earnings | | Distributions | | Balance (3) | |
Named Executive Officer | | | | ($) | | ($) | | ($) | | ($) | | ($) | |
| | | | | | | | | | | | | |
Steven E. Trager (CHAIR/CEO) | | Deferred Plan | | — | | — | | — | | — | | — | |
| | | | | | | | | | | | | |
Logan M. Pichel (PRES) | | Deferred Plan | | 25,000 | | 25,000 | | 6,482 | | — | | 56,482 | |
| | | | | | | | | | | | | |
Kevin D. Sipes (CFO) | | Deferred Plan | | 25,000 | | 25,000 | | (11,268) | | — | | 126,133 | |
| | | | | | | | | | | | | |
William R. Nelson (PRES/RPG) | | Deferred Plan | | 25,000 | | 25,000 | | (7,737) | | — | | 112,348 | |
| | | | | | | | | | | | | |
Juan M. Montano (EVP/CMBO) | | Deferred Plan | | 25,000 | | 25,000 | | (11,228) | | — | | 125,977 | |
| | | | | | | | | | | | | |
| (1) | The amounts in this column are also included in the “Summary Compensation Table” in columns (c) and (j) for the NEOs. |
| (2) | The amounts listed in this column |
| (3) | The aggregate amounts shown in column (f) include the following amounts that were reported as compensation to the NEOs in the “Summary Compensation Table” in Republic’s previous proxy statements: |
| ◾ | For CEO/Bank, a total of $50,000 was reported (2020), and $50,000 (2021); |
| For |
| For |
33
54 | Republic Bancorp, Inc. |
POST-EMPLOYMENT COMPENSATION
Republic entered into Officer Compensation Continuation Agreements with the CHAIR/CEO that became effective January 12, 1995 and with the CFO on June 15, 2001, each of which was amended and restated in 2008 (all collectively, “Agreements”). The Agreements provide for the payment of the present value of 24 months of the NEO’s base salary in a lump sum if, following the announcement of a potential change in control, or after an actual change in control, the NEO terminates his employment for “Good Reason” or his employment is terminated other than pursuant to death or for “Cause,” as defined in the Agreements. “Good Reason” is defined to include a material diminution in duties or demotion, material change in benefit plans or fringe benefits, a relocation outside Louisville of the Company’s executive offices or a reduction in base salary. In addition to the lump sum severance payment, the executive would receive payment for any legal fees incurred to enforce this agreement, and accelerated vesting on all stock options and stock appreciation rights as well as assignment to the executive of any Bank-owned life insurance policy on the NEO’s life and benefits provided by the Bank are to continue for 24 months, to the extent possible, or alternative benefits are to be secured.
The Agreements are automatically extended for one (1) additional year at each December 31, to maintain a three (3) year coverage period, unless Republic timely gives notice to the NEO that it elects not to extend the Agreement. Therefore, the Agreements were renewed effective as of December 31, 2020 for a term to cover any change in control that occurs within three (3) years after that date. As further described below, the CFO’s Agreement was superseded by a new change in control agreement in January 2021.
Payments under the Agreements are generally in a lump sum, but it will be delayed to the extent they are not exempt “severance” as defined in Internal Revenue Code Section 409A, until six (6) months following the NEOs separation from service from Republic and the Bank. The initial payment to the NEO will include any make up payments that would have been made to him but for the delay due to his status as a “key employee.” The Agreements limit the total value of the consideration paid to three times the five-year average of his prior taxable compensation, so as to avoid lost tax deductions or excise taxes under Internal Revenue Code Section 280G.
On January 27, 2021,2022, the Board approved Change in Control Severance Agreements for other executive officers,certain Executive Officers, including the PRES/Chair/CEO, CEO/Bank, Pres/RPG, EVP/CMBO,CFO, and the CFOCRO (collectively, the “2021“Change in Control Agreements”). The Change in Control Severance Agreement forAgreements provide the CFO replaced and superseded the CFO’s previous Officer Compensation Continuation Agreement. The 2021 Agreements providefollowing to an NEO whowhose employment is terminated followingafter a change in control by the Company other than for cause or who resignsby the NEO for good reason and who signs a release of all claims, the following:claims:
| 1) |
| 2) | Severance compensation equal to two times the |
| 3) |
| 4) |
| 5) |
| 6) |
Payments under the 2021Change in Control Agreements to an executive who is a “key employee” will be delayed to the extent they are not exempt “severance” as defined in Internal Revenue Code Section 409A, until six (6) months following the executive’s separation from service from Republic and the Bank. The initial payment to an executive will include any make upmake-up payments that would have been made to the executive but for the delay due to the executive’s status as a “key employee.”employee”. The benefits under the 2021Change in Control Agreements may be reduced if they would trigger an excise tax under Internal Revenue Code Section 280G, but only if the net after tax value to the executive after such reduction is higher than it would be if the entire amount were paid and the executive paid the related excise taxes.
The 2021Change in Control Agreements also include noncompete, non-solicitation, and confidentiality covenants that apply whether or not a termination triggers severance or a change in control has occurred.
34
For purposes of all these agreements, a change in control includes the acquisition by a person of beneficial ownership of securities representing greater voting power than held by the “Trager Family Members” as a group or a reduction to less than 25% of the combined voting power of the stock held by the “Trager Family Members.”
The PRES is not a party to a 2020 or 2021 Agreement but as part of his Employment Agreement dated April 24, 2020, the PRES is entitled to receive post-employment compensation if his employment is terminated without cause or he resigns for good reason (including a resignation following the failure to appoint him CEO of the Bank before January 1, 2022) before April 1, 2022 or in connection with a change of control that occurs prior to January 1, 2022, as follows:
Good Reason under this agreement includes failure to promote PRES to CEO of the Bank prior to January 1, 2022. Assuming the PRES attains the Chief Executive Officer position of the Bank on or before January 1, 2022, it is the Bank’s intent to offer a new Change of Control agreement at that time that will include two years of base salary plus two times average bonus in the event of the occurrence of a double trigger termination, on terms similar to those then in effect for other executive officers of the Bank.
35
Detail of executive agreements that trigger post-employment payments, trigger events, and estimated payment amount/values, including the potential spread in value that would be realized on as-yet unvested equity awards or upon accelerated vesting of deferred compensation plan matching if a change in control had occurred on December 31, 2020,2022, are summarized in the following table. For the CFO, the PRES/RPG and the EVP/CMBO who all entered into change in control agreements with the Bank in January 2021, the table presents the estimated payment values as if those agreements were in effect on December 31, 2020.
| | | | | | | | | |
Executive Name |
| Agreement Which Triggers Payments |
| Trigger Event |
| Estimated | |
| |
| | | | | | | | | |
Steven E. Trager (CHAIR/CEO) | | Officer Compensation Continuation Agreement last restated in 2008 |
| Termination of Employment after potential or actual Change in Control | | $ | 974,586 | (2) | |
| | | | | | | | | |
Logan M. Pichel (PRES) | | Employment Agreement and equity grant agreements with accelerated vesting on Change in Control |
| Termination of Employment before or after Change in Control + Equity award vesting that occurs at such termination | | $ | 1,457,948 | (3) | |
| | | | | | | | | |
Kevin D. Sipes (CFO) | | 2021 Agreement – Change in Control Severance Agreement, and equity grant agreements and deferred compensation match accelerated vesting on Change in Control |
| Termination of Employment after Change in Control + Equity award and deferred compensation match vesting occurs at Change in Control | | $ | 1,146,816 | (4)(5) | |
| | | | | | | | | |
William R. Nelson (PRES/RPG) | | 2021 Agreement – Change in Control Severance Agreement and equity grant agreements and deferred compensation match accelerated vesting on Change in Control |
| Termination of Employment after Change in Control + Equity award and deferred compensation match vesting occurs at Change in Control | | $ | 1,423,965 | (4) | |
| | | | | | | | | |
Juan M. Montano (EVP/CMBO) | | 2021 Agreement - Change in Control Severance Agreement and equity grant agreements and deferred compensation match accelerated vesting on Change in Control |
| Termination of Employment after Change in Control + Equity award and deferred compensation match vesting occurs at Change in Control | | $ | 1,183,085 | (4) | |
| | | | | | | | | |
| |
2023 PROXY STATEMENT | 55 |
| | | | | | | | |
| | | | | | | | |
| | | | | | Estimated | | |
| | | | | | Payment | | |
Executive Name |
| Agreement Which Triggers Payments |
| Trigger Event |
| Amount/Value (1) |
| |
| | | | | | | | |
| | | | | | | | |
Steven E. Trager (Chair/CEO) | | Change in Control Agreement - Change in Control Severance Agreement, equity grant agreements and deferred compensation match accelerated vesting on Change in Control | | Termination of Employment after Change in Control + Equity award and deferred compensation match vesting occurs at Change in Control | | $ | 1,228,063 | (2) |
| | | | | | | | |
| | | | | | | | |
Logan M. Pichel (CEO/Bank) |
| Change in Control Agreement – Change in Control Severance Agreement, equity grant agreements and deferred compensation match accelerated vesting on Change in Control |
| Termination of Employment after Change in Control + Equity award and deferred compensation match vesting occurs at Change in Control | | $ | 3,349,958 | (3) |
| | | | | | | | |
| | | | | | | | |
Kevin D. Sipes (CFO) |
| Change in Control Agreement – Change in Control Severance Agreement, equity grant agreements and deferred compensation match accelerated vesting on Change in Control |
| Termination of Employment after Change in Control + Equity award and deferred compensation match vesting occurs at Change in Control | | $ | 1,364,598 | (3) |
| | | | | | | | |
| | | | | | | | |
William R. Nelson (Pres/RPG) |
| Change in Control Agreement – Change in Control Severance Agreement equity grant agreements and deferred compensation match accelerated vesting on Change in Control |
| Termination of Employment after Change in Control + Equity award and deferred compensation match vesting occurs at Change in Control | | $ | 1,681,461 | (3) |
| | | | | | | | |
| | | | | | | | |
John T. Rippy (CRO) |
| Change in Control Agreement – Change in Control Severance Agreement equity grant agreements and deferred compensation match accelerated vesting on Change in Control |
| Termination of Employment after Change in Control + Equity award and deferred compensation match vesting occurs at Change in Control | | $ | 1,227,713 | (3) |
| | | | | | | | |
| (1) | Each of these agreements is described in more detail in the section above. |
| (2) | The estimated values are determined based on the |
36
| The estimated |
56 | Republic Bancorp, Inc. |
Pay Versus Performance
As required by Section 953(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, and Item 402(v) of Regulation S-K, the Company provides the following information about the relationship between executive compensation actually paid to the Company’s principal executive officer (“PEO”), who is the Chair/CEO, and non-PEO NEOs by the Company and certain financial performance of the Company. For further information concerning the Company’s compensation philosophy and how the Company aligns executive compensation with the Company’s performance, refer to the “Compensation Discussion and Analysis” section of this Proxy Statement.
| | | | | | | | |
|
| | Average | | Value of Initial Fixed $100 Investment Based On: | | | |
| | | Summary | Average |
| | | |
| Summary | | Compensation | Compensation | | Peer Group | | Gross |
| Compensation | Compensation | Table Total for | Actually Paid | Total | Total | | Operating |
| Table Total for | Actually Paid | Non-PEO | to Non-PEO | Shareholder | Shareholder | Net Income | Profit |
| PEO¹ | to PEO² | NEOs³ | NEOs⁴ | Return⁵ | Return⁶ | (thousands)⁷ | (thousands)⁸ |
Year | ($) | ($) | ($) | ($) | ($) | ($) | ($) | ($) |
| | | | | | | | |
2022 | 804,352 | 804,352 | 1,046,354 | 530,140 | 98.86 | 100.39 | 91,106 | 116,845 |
2021 | 664,050 | 664,050 | 975,474 | 1,330,208 | 117.82 | 126.45 | 87,611 | 111,442 |
2020 | 641,217 | 641,217 | 761,975 | 717,809 | 80.82 | 90.69 | 83,246 | 102,633 |
1 This column represents the amount of total compensation reported for the Chair/CEO for each corresponding year in the “Total” column of the “Summary Compensation Table” of this Proxy Statement.
2 This column represents the amount of “compensation actually paid” to the Chair/CEO, as computed in accordance with Item 402(v) of Regulation S-K. The amounts do not reflect the actual amount of compensation earned by or paid to the Chair/CEO during the applicable year. In accordance with the requirements of Item 402(v) of Regulation S-K, as outlined in the following table, no adjustments were made to the Chair/CEO’s total compensation for each year to determine the compensation actually paid:
| | | | | | | |
|
| | | | | | |
| | | | | Deductions | | |
| | Bonus and | | | from | Additions to | |
| | Non-Equity | Other | Summary | Summary | Summary | |
| | Incentive | Compensation | Compensation | Compensation | Compensation | Compensation |
| Salary | Compensation | (a) | Table Total | Table Total (b) | Table Total (c) | Actually Paid |
Year | ($) | ($) | ($) | ($) | ($) | ($) | ($) |
| | | | | | | |
2022 | 441,657 | 320,000 | 42,695 | 804,352 | - | - | 804,352 |
2021 | 434,808 | 187,500 | 41,742 | 664,050 | - | - | 664,050 |
2020 | 425,000 | 175,000 | 41,217 | 641,217 | - | - | 641,217 |
| (a) | This column represents “all other compensation” reported for the Chair/CEO for each corresponding year in the “Total” column of the Summary Compensation Table in the year shown. Please refer to the “Summary Compensation Table” section of this Proxy Statement. |
| (b) | This column represents the grant date fair value of equity awards reported in the “Stock Awards” and “Option Awards” columns in the Summary Compensation Table for the applicable year which was $0 for the Chair/CEO. The Company does not provide a pension or above market or preferential earnings on deferred compensation that is not tax qualified to its NEOs or any of its associates. |
| (c) | This column represents an adjusted amount of the “Stock Awards” and “Option Awards” columns in the Summary Compensation Table for the applicable year (a “Subject Year”). For a Subject Year, this adjusted |
| |
2023 PROXY STATEMENT | 57 |
| amount replaces the “Stock Awards” and “Option Awards” columns in the Summary Compensation Table for the Chair/CEO to arrive at “compensation actually paid” to the Chair/CEO for that Subject Year. This adjusted amount is determined by subtracting the amounts reported in the “Stock Awards” and “Option Awards” columns in the Summary Compensation Table for the Subject Year and the addition (or subtraction, as applicable) of the following for that Subject Year: (i) the year-end fair value of any equity awards granted in the Subject Year that are outstanding and unvested as of the end of the Subject Year; (ii) the amount of change as of the end of the Subject Year (from the end of the prior fiscal year) in the fair value of any awards granted in prior years that are outstanding and unvested as of the end of the Subject Year; (iii) for awards that are granted and vest in the Subject Year, the fair value as of the vesting date; (iv) for awards granted in prior years that vest in the Subject Year, the amount equal to the change as of the vesting date (from the end of the prior fiscal year) in the fair value; (v) for awards granted in prior years that are determined to fail to meet the applicable vesting conditions during the Subject Year, a deduction for the amount equal to the fair value at the end of the prior fiscal year; and (vi) the dollar value of any dividends or other earnings paid on stock or option awards in the Subject Year prior to the vesting date that are not otherwise reflected in the fair value of such award or included in any other component of total compensation for the Subject Year. The Chair/CEO did not have any outstanding “Stock Awards” or “Option Awards” during the years 2020, 2021, and 2022. |
436,636 | |
3 This column represents the average of the amounts reported for the Company’s NEOs as a group (excluding the Chair/CEO) in the “Total” column of the Summary Compensation Table in each applicable year. Please refer to the “Summary Compensation Table” section of this Proxy Statement for the applicable year. The names of each of the NEOs (excluding the Chair/CEO) included for purposes of calculating the average amounts in each applicable year are as follows: (i) for 2022, CEO/Bank, CFO, Pres/RPG, and CRO; (ii) for 2021, CEO/Bank, CFO, Pres/RPG, and the Chief Mortgage Banking Officer (the “CMBO”); and (iii) for 2020, CEO/Bank, CFO, Pres/RPG, and CMBO.
4 This column represents the average amount of “compensation actually paid” to the NEOs as a group (excluding the Chair/CEO ), as computed in accordance with Item 402(v) of Regulation S-K. The dollar amounts do not reflect the actual average amount of compensation earned by or paid to the NEOs as a group (excluding the Chair/CEO) during the applicable year. In accordance with the requirements of Item 402(v) of Regulation S-K, the following adjustments were made to average total compensation for the NEOs as a group (excluding the Chair/CEO) for each year to determine the compensation actually paid, using the same adjustment methodology described above in Note 2(c):
| | | | | | | |
|
| | | | | | |
| | | | | Deductions | | |
| | Bonus and | | | from | Additions to | |
| | Non-Equity | | Summary | Summary | Summary | |
| | Incentive | Other | Compensation | Compensation | Compensation | Compensation |
| Salary | Compensation | Compensation (a) | Table Total | Table Total (b) | Table Total (c) | Actually Paid |
Year | ($) | ($) | ($) | ($) | ($) | ($) | ($) |
| | | | | | | |
2022 | 436,636 | 280,625 | 44,841 | 1,046,354 | (309,252) | (206,962) | 530,140 |
2021 | 431,967 | 265,938 | 42,185 | 975,474 | (260,361) | 615,095 | 1,330,208 |
2020 | 353,364 | 233,125 | 59,925 | 761,975 | (140,561) | 96,395 | 717,809 |
| (a) | This column reflects “all other compensation” reported for each corresponding year in the “Total” column of the Summary Compensation Table in the year shown. Please refer to the “Summary Compensation Table” section of this Proxy Statement. |
| (b) | This column represents the grant date fair value of the Company match of stock equivalents during 2022 through the Nonqualified Deferred Compensation Plan and the grant date fair value of the equity awards granted during 2022. These items are reported in the “Stock Awards” and “Option Awards” columns in the respective years’ within the Summary Compensation Table. Please refer to the “Summary Compensation Table” section of this Proxy Statement for the applicable year. |
| (c) | This column represents an adjustment to the average of the amounts reported for the NEOs as a group (excluding the Chair/CEO) and includes: |
58 | Republic Bancorp, Inc. |
| a. | the change in the fair value of the cumulative unvested Company match of the stock equivalents through the Nonqualified Deferred Compensation Plan, as well as those amounts which vested during the respective year; and |
| b. | the change in fair value of the cumulative unvested equity awards and those that vested during the respective year, all of which were |
For each year, the adjusted amount replaces the “Stock Awards” and “Option Awards” columns in the Summary Compensation Table for each NEO (excluding the Chair/CEO) to arrive at “compensation actually paid” to each NEO (excluding the Chair/CEO) for that year, which is then averaged to determine the average “compensation actually paid” to the NEOs (excluding the Chair/CEO) for that year. The valuation assumptions used to calculate fair values did not materially differ from those disclosed at the time of grant. The amounts added or subtracted to determine the adjusted average amount are as follows:
| | | | | | | |
| | | | | | Value of | |
| | | | | | Dividends or | |
| | | | | | other | |
| | | | | | Earnings Paid | |
| | Year over | | | | on Stock or | |
| | Year Change | | | Fair Value | Option Awards | |
| | in Fair Value | Fair Value | | at the End | not Otherwise | |
| | of | as of | Change in | of the Prior | Reflected in | |
| | Outstanding | Vesting | Fair Value | Year of | Fair Value or | |
| | and | Date of | of Equity | Equity | Total | |
| | Unvested | Equity | Awards | Awards | Compensation | |
| Fair Value | Equity | Awards | Granted | that Failed | in the | |
| of Equity | Awards at | Granted | in Prior | to Meet | Summary | Adjusted |
| Awards | FYE Granted | and | Years that | Vesting | Compensation | Value of |
| Granted in | in Prior | Vested in | Vested in | Conditions | Table for the | Equity |
| the Year | Years | the Year | the Year | in the Year | Year | Awards |
Year | ($) | ($) | ($) | ($) | ($) | ($) | ($) |
| | | | | | | |
2022 | 141,026 | (354,983) | - | (2,259) | - | 9,254 | (206,962) |
2021 | 309,624 | 300,222 | - | - | - | 5,249 | 615,095 |
2020 | 176,214 | (30,348) | - | (51,996) | - | 2,525 | 96,395 |
5 This column represents cumulative Company total shareholder return (“TSR”). TSR is calculated by dividing the sum of the cumulative amount of dividends for each measurement period (2020, 2021 and 2022), assuming dividend reinvestment, and the difference between the Company’s share price at the end and the beginning of the measurement period by the Company’s share price at the beginning of the measurement period.
6 This column represents cumulative peer group TSR, weighted according to the respective companies’ stock market capitalization at the beginning of each period for which a return is indicated, and otherwise computed in accordance with Note 5. The peer group used for this purpose is the KBW NASDAQ Bank Index, a published industry index.
7 This column represents the amount of net income reflected in the Company’s audited financial statements for the applicable year.
8 This column represents the amount of gross operating profit (pre-tax net income) reflected in the Company’s audited financial statements for the applicable year.
| |
2023 PROXY STATEMENT | 59 |
Financial Performance Measures
As described in greater detail in the “Compensation Discussion and Analysis” section of this Proxy Statement, the most important metrics that the Company uses for both our long-term and short-term incentive awards are selected based on an objective of incentivizing the Company’s NEOs to increase the value of our business for our shareholders. The most important financial performance measures used by the Company to link executive compensation actually paid to the Company’s NEOs, for the most recently completed fiscal year, to the Company’s performance are as follows:
PEO | |
Total Company Gross Operating Profit | |
CEO/Bank, CFO, CRO | |
Total Company Gross Operating Profit | |
Company ranking versus peers on return on average assets (ROAA) | |
Company ranking versus peers on efficiency ratios | |
Pres/RPG | |
Republic Processing Group Gross Operating Profit | |
Company ranking versus ROAA | |
Company ranking versus peers on efficiency ratios | |
Analysis of the Information Presented in the Pay versus Performance Table
While the Company utilizes several performance measures to align executive compensation with Company performance (as described in greater detail in the “Compensation Discussion and Analysis” section of this Proxy Statement), not all of those Company measures are presented in the Pay versus Performance table. Moreover, the Company does not specifically align the Company’s performance measures with compensation actually paid (as computed in accordance with Item 402(v) of Regulation S-K) for a particular year. In accordance with Item 402(v) of Regulation S-K, the Company is providing the following the descriptions of the relationships between the information presented in the Pay versus Performance table below.
60 | Republic Bancorp, Inc. |
Compensation Actually Paid and Cumulative TSR
Compensation Actually Paid and Net Income*
* As further outlined in the table below, Net income - Adjusted excludes the after-tax income and associated expenses related to the Settlement.
| | | | | |
| 2020 | | 2021 | | 2022 |
Year | ($) | | ($) | | ($) |
| | | | | |
Net Income - GAAP | 83,246 | | 87,611 | | 91,106 |
Net Income, including associated expenses, related to the Settlement | - | | 1,444 | | (13,227) |
Net Income - Adjusted | 83,246 | | 89,055 | | 77,879 |
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2023 PROXY STATEMENT | 61 |
Compensation Actually Paid and Gross Operating Profit*
* As further outlined in the table below, Gross Operating Profit - Adjusted excludes the income and associated expenses related to the Settlement.
| | | | | |
| 2020 | | 2021 | | 2022 |
Year | ($) | | ($) | | ($) |
| | | | | |
Gross Operating Profit - GAAP | 102,633 | | 111,442 | | 116,845 |
Gross Operating Profit, including associated expenses, related to the Settlement | - | | 1,911 | | (17,086) |
Gross Operating Profit - Adjusted | 102,633 | | 113,353 | | 99,759 |
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62 | Republic Bancorp, Inc. |
2022 PAY RATIO DISCLOSURE
| ||
Selection of Determination Date | | The Company determined the |
| | |
Identification of Median Employee | | The Median Employee for 2022 is a full-time associate, is incentive eligible, and participates in the Bank’s 401(k) Plan and the life and disability insurance programs provided by the Bank. The Median Employee’s base compensation is $58,917. All elements of the Median Employee’s 2022 compensation, including incentives and the Company-paid cost of benefits mentioned below, totaled $62,029. |
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Calculation of Chair/CEO’s Annual Total | | Using Chair/CEO’s income disclosed in the Summary Compensation Table of the proxy statement, the Company calculates the Chair/CEO’s total compensation for purposes of the pay ratio to be $804,352. As a result, the |
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(a) | | (b) | | (c) | | (d) | | (e) | | (f) | | (g) | | (h) | | (i) | | (j) |
| | | | | | | | | | | | | | Change in | | | | |
| | | | | | | | | | | | | | Pension | | | | |
| | | | | | | | | | | | | | Value and | | | | |
| | | | | | | | | | | | | | Non-Qualified | | | | |
| | | | | | | | | | | | Non-Equity | | Deferred | | | | |
| | | | | | | | Stock | | Option | | Incentive Plan | | Compensation | | All Other | | |
Name and Principal | | | | Salary | | Bonus (1) | | Awards | | Awards | | Compensation | | Earnings | | Compensation (2) | | Total |
Position |
| Year |
| ($) |
| ($) |
| ($) |
| ($) |
| ($) |
| ($) |
| ($) |
| ($) |
| | | | | | | | | | | | | | | | | | |
Steven E. Trager (Chair/CEO) |
| 2022 |
| 441,657 |
| 40,000 |
| — |
| — |
| 280,000 |
| — |
| 42,695 |
| 804,352 |
Median Employee |
| 2022 |
| 58,915 |
| 100 |
| — |
| — |
| 1,250 |
| — |
| 1,764 |
| 62,029 |
| (1) | See the “2022 Summary Compensation Table” in this Proxy Statement for a description of the Chair/CEO’s discretionary bonus. The Median Employee received a $100.00 gift card. |
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The Company determined the Median Employee as of December 31, 2022. The Chair/CEO’s total annual compensation is approximately thirteen (13) times larger than the median employee’s annual total compensation. | | |
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2023 PROXY STATEMENT | 63 |
AUDIT COMMITTEE REPORT
The Audit Committee has furnished the following report:
It is the responsibility of management to prepare the consolidated financial statements and the responsibility of Crowe LLP, Republic’s independent registered public accounting firm, to audit the consolidated financial statements for conformity with accounting principles generally accepted in the United States of America. The Audit Committee has adopted a written charter describing the functions and responsibilities of the Audit Committee. The Audit Committee charter is available on the Company’s website at www.republicbank.com.
In connection with its review of Republic’s consolidated financial statements for 2020,fiscal year 2022, the Audit Committee has:
| Reviewed and discussed the audited consolidated financial statements with Republic’s management; |
| Discussed with |
| Received the written disclosures and the letter from the independent registered public accounting firm required by the applicable requirements of the PCAOB regarding the independent registered public accounting firm’s communications with the Audit Committee concerning independence |
| Approved the audit and non-audit services of the independent registered public accounting firm for |
The Audit Committee has also discussed with management and the independent registered public accounting firm, the quality and adequacy of Republic’s internal controls and the internal audit function’s organization, responsibilities, budget, and staffing. The Audit Committee reviewed with the independent registered public accounting firm their audit plans, audit scope, and identification of audit risks. The Audit Committee has procedures in place to receive and address complaints regarding accounting, internal controls, or auditing and other Company issues.
Based on the review and discussions referred to above, the Audit Committee recommended to the Board of Directors that the audited consolidated financial statements be included as presented in Republic’s Annual Report on Form 10-K for the year ended December 31, 2020.2022.
Members of the Audit Committee:
Mark A Vogt, CPA, Chair
Ronald F. Barnes
Craig A. GreenbergTimothy S. Huval
Michael T. Rust
37
64 | Republic Bancorp, Inc. |
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
With respect to transactions involving the Company and its Directors, Executive Officers, and 5% shareholders, the Audit Committee’s charter provides that it will conduct an appropriate review of all related party transactions for potential conflict of interest situations on an ongoing basis, and the approval by the Audit Committee is required for all such transactions (other than transactions governed by Regulation O of the Board of Governors of the Federal Reserve System, which have received the approval of the Board of Directors of the Company’s bank subsidiary)Bank). In reviewing a related party transaction, the Audit Committee considers the material terms of the transaction, including whether the terms are generally available to an unaffiliated third party under similar circumstances. In addition, the Board of Directors is informed of such related party transactions.
Within the Louisville, Kentucky metropolitan area, the Bank leases space in buildings owned by a limited liability company, MAKBE, LLC, whose managing members are the children and nephews of Steven E. Trager, and limited liability companies whose managing members are Steven E. Trager and the children and nephews of Steven E. Trager.MAKBE, LLC. See notes to the table under “Share Ownership.Ownership”. The buildings include Republic Corporate Center, whichthat serves as both the Company’s main office and administrative headquarters in Louisville, Kentucky and is owned and leased by MAKBE, LLC, a limited liability company beneficially owned by the children and nephews of Steven E. Trager.Trager, including Andrew Trager-Kusman who also is a Director of the Bank and Company. During 2020,2022, additional leasing relations included the Bank’s Hurstbourne Parkway banking center whichthat is owned and leased to the Bank by Jaytee – Hurstbourne, LLC,LLC; the Bardstown Road banking center whichthat is owned and leased to the Bank by Jaytee – Bardstown, LLC andLLC; the Springhurst banking center that is owned and leased to the Bank by Jaytee – Springhurst, LLC,LLC; and space at the Republic Plaza location that is owned and leased to the Bank by Jaytee Properties II SPE, LLC. Under certain of these lease arrangements, the Bank was responsible for the fit-up and certain build outbuild-out costs associated with the leased premises at those facilities. Altogether, these affiliates currently lease 223,245225,009 square feet to the Bank and the Bank pays $395,433$408,816 per month in rent, with lease terms expiring between 2023 and 2030. The aggregate annual amount paid under these affiliate leasing arrangements in 20202022 was $4,743,763.$4,914,408. In accordance with the Audit Committee charter, each of the above leasing transactions was approved by the Board of Directors and the Audit Committee and all were determined by the Board of Directors and the Audit Committee to be on terms comparable to those that could have been obtained from unaffiliated parties.
Right of First Offer Agreement.
On September 19, 2007, Republic entered into a Right of First Offer Agreement (the “Agreement”) with Teebank Family Limited Partnership (“Teebank”), and Bernard M. Trager and Jean S. Trager (collectively, the “Tragers”).
The Agreement does not restrict Teebank’s sale of shares of Republic common stock up until the trigger date (the “Trigger Date”) of the second to die of the Tragers. If Teebank desires to sell to a third party up to 1,000,000 shares of Class A Common Stock in the nine (9) months following the Trigger Date, Teebank must first offer the shares to Republic. Republic then has twenty (20) business days after the notice of a proposed sale to exercise the option, subject to satisfaction of any required regulatory notice requirements and receipt of all required regulatory approvals within sixty (60) days of the option exercise. The option exercise price is the Fair Market Value, as defined in the Agreement, of the shares on the closing date. Teebank is not required to consummate the transaction if the Fair Market Value on the closing date is less than 95% of the Fair Market Value on the date Teebank first gave notice of the proposed sale. Republic can exercise the option only if a majority of Republic’s independent directorsIndependent Directors determine at the time of exercise that the exercise is in Republic’s best interests.
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2023 PROXY STATEMENT | 65 |
The Agreement terminates on the first to occur of the following: (i) a Change in Control, as defined in the Agreement, of Republic, (ii) Republic’s duty to file reports required under Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 is suspended, or (iii) fourteen (14) months following the Trigger Date. In addition, Teebank may terminate the Agreement following a material change in the anticipated impact of the estate tax laws and regulations upon the Tragers or their estates.
Employment Relationship and Consulting Agreement with ONE Director.
Director David P. Feaster served as the CEO, President, and a director of Cornerstone Community Bank at the time of its merger with the Bank in 2016. From 2016 until his retirement in August 2019, Mr. Feaster served as the Bank’s Florida Market President. Upon his retirement as an employee, Mr. Feaster and the Bank entered into a consulting agreement whereby Mr. Feaster has provided consulting services on an independent contractor basis related to the Bank’s operations in Florida. In exchange for the consulting services, the Bank makes monthly payments to Mr. Feaster of $5,000, plus expenses and monthly dues to a Florida country club. Beginning January 31, 2020, the agreement provides for automatic monthly extensions,
38
subject to termination on 30-days30-days’ notice. Mr. Feaster became a directorDirector of the Bank in September 2019.2019 and a Director of Republic in April 2020. For a description of directorDirector fees, for the Bank’s directors, see the narrative at “Director Compensation.” During 2020,2022, the Bank paid Mr. Feaster an aggregate of $100,679$124,825 for his services as a consultant and directorDirector of the Bank and Company. Upon the termination of the consulting services or at such time as the consulting services decline below a certain level of time commitment, Mr. Feaster is entitled to benefits under a nonqualified supplemental executive retirement benefits agreement under which he began accruing benefits beginning in 2009 while employed by Cornerstone Community Bank.
Relationships with Directors.
There are no additional relationships with Republic Directors, Bank Directors, or the Director Nominees not described in this section or the subsection of this proxy statement titled “Committees of the Company’s Board.”
Indebtedness of Directors, Director Nominees, Executive Officers, and Principal Shareholders.
There is no absolute prohibition on personal loans to Directors, Director Nominees, or Executive Officers of insured depository institutions. However, Federal banking laws require that all loans or extensions of credit by the Bank to the Company’s or the Bank’s Executive Officers, Directors, and Director Nominees be made on substantially the same terms, including interest rate and collateral requirements, as those prevailing at the time for comparable transactions with the general public and must not involve more than the normal risk of repayment or present other unfavorable features. These loans must be of a type generally made available to the Company’s employees or the public at large. In addition, if required by Regulation O, loans made to Executive Officers, Company Directors, and Director Nominees and Bank Directors must be approved in advance by a majority of the disinterested members of the Board of Directors as required by Regulation O.Directors.
During 2020,2022, Directors, Director Nominees, and Executive Officers of Republic and the Bank and other persons or entities with which they are affiliated or with whom they are members of the same immediate family were customers of and had in the ordinary course of business banking transactions with the Bank. All loans included in such transactions were made in the ordinary course of business, were generally available to the public, were made on substantially the same terms, including interest rate and collateral, as those prevailing at the time for comparable loan transactions with other persons not related to the lender, which loans did not involve more than the normal risk of collectability or present other unfavorable features as per Regulation S-K Item 404(a) Instruction 4(c).
Split Dollar Insurance Agreement.
By an agreement dated December 14, 1989, as amended August 8, 1994, the Bank entered into a split-dollar insurance agreement with a trust established by the Company’s deceased former Chairman, Bernard M. Trager, which agreement the trust assigned to MAKBE, LLC in 2016. Pursuant to the agreement, from 1989 through 2002, the Bank paid $690,000 in total annual premiums on insurance policies held in the trust. The policies are joint-life policies payable upon the death of Ms. Jean S. Trager, as the survivor of her husband Bernard M. Trager. The cash surrender value of the policies was approximately $2.29$1.8 million as of December 31, 2020.2022.
66 | Republic Bancorp, Inc. |
Pursuant to the terms of the trust, the Bank paid the premiums for the policies held in the trust. In connection with the assignment of, among other assets of the trust, the indebtedness of the trust to MAKBE, LLC, the beneficiaries of the trust will each receive the proceeds of the policies after the repayment of the $690,000 of indebtedness to the Bank. The aggregate amount of such unreimbursed premiums constitutes indebtedness from MAKBE, LLC to the Bank and is secured by a collateral assignment of the policies. As of December 31, 2020,2022, the net death benefit under the policies was approximately $4.5 million. Upon the termination of the agreement, whether by the death of Ms. Trager or earlier cancellation, the Bank is entitled to be repaid by MAKBE, LLC the amount of indebtedness outstanding at that time. In July 2018, MAKBE, LLC began making quarterly payments in the amount of $25,000 to the Bank towards the liability. As of December 31, 2020,2022, the amount owed by MAKBE, LLC to the Bank is $440,000.$240,000.
DELINQUENT SECTION 16(a) REPORTS
Section 16(a) of the Securities Exchange Act of 1934 requires Republic’s Officers, Directors and greater than 10% beneficial owners to file reports of ownership and changes in ownership with the Securities and Exchange Commission. Officers and directors are required to furnish Republic with copies of all Section 16(a) forms filed. Based solely upon review of copies of such forms received, or written representations that there were no unreported holdings or transactions, Republic believes that, for the most recent fiscal year, all Officers, Directors, and 10% beneficial owners complied with applicable Section 16(a) filing requirements on a timely basis with the following exception: David P. Feaster, Director, failed to timely file (i) a Form 4 to report a purchase of 500 shares of Class A Common Stock on May 8, 2020, (ii) a Form 4 to report a purchase of 500 shares of Class A Common Stock on May 11, 2020, and (iii) two late
39
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2023 PROXY STATEMENT | 67 |
Form 4 reports with respect to the automatic reinvestmentTable of two quarterly dividend payments in 2020 on Republic shares held in Mr. Feaster’s brokerage account. Mr. Feaster filed a Form 5 on February 16, 2021 to report the four transactions.Contents
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SOLICITATION OF PROXIES
The cost of solicitation of proxies hereby will be borne by Republic. Some of Republic’s Directors and Executive Officers who will receive no additional compensation may solicit proxies in person and by telephone, electronic media, facsimile, and mail from brokerage houses and other institutions, nominees, fiduciaries, and custodians who will be requested to forward the proxy materials to beneficial owners of the Class A Common Stock and Class B Common Stock. Republic will, upon request, reimburse such intermediaries for their reasonable expenses in forwarding proxy materials but will not pay fees, commissions, or other compensation.
68 | Republic Bancorp, Inc. |
PROPOSAL TWO: ADVISORY VOTE ON THE COMPENSATION OF OUR NAMED EXECUTIVE COMPENSATIONOFFICERS
Recommendation of Republic’s Board of Directors | The Board of Directors recommends that shareholders vote “FOR” the approval, on an advisory basis, of the compensation of its Named Executive Officers, as disclosed in this proxy statement. |
The Company’s compensation policiesDodd-Frank Wall Street Reform and decisions are designed to promote the Company’s business strategiesConsumer Protection Act of 2010 (the “Dodd-Frank Act”) and the interest of its shareholders by providing incentive needed to attract, motivate and retain key executives who are critical to our long-term success as a financial institution.
Shareholders are urged to read the “Compensation Discussion and Analysis” section of this Proxy Statement, which discusses how the Company’s compensation design and practices reflect its compensation philosophy. The Compensation Committee and the Board of Directors believe that its compensation design and practices are effective in implementing the Company’s strategic goals and business strategies.
The Company is required to submit a proposal to shareholders for a (non-binding) advisory vote to approve the compensation of our NEOs pursuant to Section 14A of the 1934 Act.Exchange Act enable our shareholders to vote to approve, on a non-binding advisory basis, the compensation of the Company’s named executive officers, as described below in this proxy statement. This proposal, commonly known as a “say-on-pay” proposal, gives the Company’sour shareholders the opportunity to express their views onendorse or not endorse our executive compensation program through the following resolution:
“RESOLVED, that the shareholders of Republic Bancorp, Inc. approve the compensation of the NEOs. named executive officers of Republic Bancorp, Inc. set forth in the executive compensation tables and any related disclosures in this proxy statement.”
This vote is not intended to address any specific item of compensation, but rather the overall compensation of our NEOsRepublic’s named executive officers and the compensation philosophy, policies, and practices described in this Proxy Statement. Accordingly,proxy statement. As discussed in this proxy statement, a primary objective of Republic’s executive compensation program is to attract and retain a talented management team and provide them with the following resolutionright incentives to execute our strategic objectives while maximizing Republic’s shareholders’ investment in the Company. Republic seeks to accomplish this goal in a way that rewards performance and is submitted for shareholder vote at the 2021 Annual Meeting:aligned with Republic’s shareholders’ long-term interests. Republic believes that its executive compensation program satisfies our compensation objectives.
“RESOLVED, that the shareholders of Republic Bancorp, Inc. approve, onAs an advisory basis,vote, this proposal is not binding on us and should not be construed as overruling any decision of Republic’s board of directors or Compensation Committee. However, Republic’s Compensation Committee, which is responsible for designing and administering its executive compensation program, values the opinions expressed by shareholders in their vote on this proposal. If there are a significant number of negative votes, Republic will seek to understand the concerns that influenced the vote and intends to address them in making future compensation decisions.
Shareholder Approval
If a quorum is present, this Proposal 2 will be approved if the votes cast for the non-binding advisory vote on the compensation of our named executive officers exceed the votes cast against.
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2023 PROXY STATEMENT | 69 |
PROPOSAL THREE: ADVISORY VOTE ON THE FREQUENCY OF future advisory votes on the compensation of our named executive officers
Recommendation of Republic’s Board of Directors | The Board of Directors recommends that shareholders vote “FOR” the option of “Every Two Years” as the frequency with which shareholders are provided an advisory vote on the compensation of its Named Executive Officers included in the Company’s proxy statement. |
The Dodd-Frank Act and Section 14A of the Exchange Act require that Republic’s shareholders have the opportunity to recommend how frequently Republic should provide for an advisory vote on the compensation of its Named Executive Officersnamed executive officers (i.e., the “Say-on-Pay” votes), as disclosed pursuant to the SEC’s compensation disclosure rules. By voting on this proposal, shareholders may indicate whether they would prefer that an advisory vote on the compensation of Republic’s named executive officers occur every one, two, or three years.
This advisory vote is commonly referred to as a “Say-on-Frequency” vote. Republic is required to give its shareholders a “Say-on-Frequency” vote no less than once every six years. Republic last conducted a “Say-on-Frequency” vote at its 2017 annual meeting of shareholders. At the 2017 annual meeting of shareholders, the shareholders voted in favor of holding “Say-on-Pay” votes every other year and the Proxy Statement forBoard adopted this standard.
Republic believes that an every other year vote gives shareholders the 2021 Annual Meeting, includingopportunity to react promptly to emerging trends in compensation and to provide feedback before those trends become pronounced over time, while also giving the Summary Compensation TableBoard and the Compensation Discussion and Analysis set forthCommittee the opportunity to evaluate individual compensation decisions every two years in such Proxy Statement andlight of ongoing shareholder feedback. Accordingly, the Board recommends that shareholders vote in favor of holding future advisory votes on named executive officer compensation on an every other related tables and disclosures.”year basis.
AsShareholders have the opportunity to vote in favor of conducting future advisory votes on named executive officer compensation every one, two, or three years, or they may abstain from voting on the proposal. The option that receives the highest number of votes will be deemed to have been selected by Republic’s shareholders.
The Board will take into account the outcome of this isvote when considering how frequently to provide for an advisory vote on named executive officer compensation in the result willfuture. However, because this vote is advisory and not be binding on the Company,us or the Board, the Board may decide that it is in our best interests and the best interests of Directors orRepublic’s shareholders to select a frequency for future advisory votes on named executive officer compensation that differs from the Compensation Committee, althoughoption that is recommended by Republic’s shareholders pursuant to the Compensation Committeepreceding paragraph.
Shareholder Approval
The option that receives the highest number of votes will considerbe deemed to have been selected by our shareholders. An abstention will have no effect on the outcome of the proposal. Brokers do not have discretionary authority to vote when evaluating the compensation program. Proxies submittedshares on this proposal without direction pursuant to this solicitationfrom the beneficial owner and broker non-votes will be voted “FOR”have no effect on the approval of the compensation of the Company’s NEOs, as disclosed in this Proxy Statement.
The Board of Directors recommends that shareholders vote “FOR” the approval, on an advisory basis, of the compensation of its Named Executive Officers, as disclosed in this Proxy Statement.
PROPOSAL THREE: AMENDMENT OF THE BYLAWS TO INCREASE LIMITATIONS ON THE AUTHORIZED NUMBER OF DIRECTORS
Article IV, Section 2 of Republic's Bylaws currently provides that the authorized number of directors shall be a minimum of five and a maximum of fifteen. Currently, there are fifteen members of the Company’s Board of Directors.
At its November 18, 2020 meeting, Republic’s Board of Directors adopted, subject to shareholder approval, an amendment to the Bylaws that would increase the specified limits of the authorized number of directors from fifteen to a maximum of eighteen. This proposed Bylaw amendment will enable the Nominating Committee, with the Board of Directors’ approval, to take timely advantage of the availability of well-qualified candidates for appointment to the Board of Directors, in particular, candidates whose skills and experience will benefit Republic. If the proposed Bylaw amendment is approved by the Company’s shareholders, then following such approval the Board of Directors may increase the number of directors up to eighteen. There are currently no plans to change the number of directors.vote.
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70 | Republic Bancorp, Inc. |
If approved, Article IV, Section 2Table of the Bylaws would be amended to read as follows:Contents
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SECTION 2. NUMBER, AGE AND TERM OF OFFICE. The number of directors shall be fixed at no less than five nor more than eighteen, with a mandatory retirement age of 72, excepting directors of record as of January 1990. A director’s age shall be determined as of December 31 of the year prior to the director’s election, i.e., a person can be elected as a director if that person is under age 72 as of December 31 of the year prior to the election. Any director who is or reaches age 72 during the director’s term shall serve until the expiration of the director’s term and until such director’s successor is duly elected and qualified. Directors shall be elected at the regular annual meeting of the stockholders for a term of one year and shall serve until their successors are elected and qualified or their earlier resignation or removal.
The Board of Directors recommends that shareholders vote “FOR” the amendment to Republic’s Bylaws that would increase the limitation on the maximum number of authorized directors from fifteen to eighteen.
PROPOSAL FOUR: RATIFICATION OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Recommendation of Republic’s Board of Directors | The Board of Directors recommends a vote “FOR” the proposal to ratify the selection of Crowe LLP as the Company’s independent registered public accounting firm for 2023. |
As previously approved by the Audit Committee, Crowe LLP was selected to serve as Republic’s independent registered public accounting firm and auditors for the fiscal year ending December 31, 2021.2023. On behalf of Republic’s Board of Directors, the Audit Committee of the Board retained Crowe LLP to audit the Company’s consolidated financial statements and the effectiveness of the Company’s internal control over financial reporting for 2021.2023. Crowe LLP was chosen based on its performance in prior years, its responsiveness, technical expertise, and the appropriateness of fees charged.
Crowe LLP has served as Republic’s independent registered public accounting firm since the 1996 fiscal year. The Company’s independent registered public accounting firm leases space from Jaytee-Springhurst, LLC, a limited liability company whose sole managing member is Jaytee,members are Steven E. Trager and MAKBE, LLC, a Kentucky limited partnershipliability company whose managing members are the children and nephews of which the CHAIR/CEO and President of Republic are partners.Steven E. Trager. The Company and Crowe LLP have determined that such leases constitute arm’s length transactions and comply with all applicable independence standards. Crowe LLP representatives are expected to attend the 20212023 Annual Meeting and will be available to respond to appropriate shareholder questions and will have the opportunity to make a statement if they desire to do so.
We areThe Company is asking ourits shareholders to ratify the selection of Crowe LLP as ourthe Company’s independent registered public accounting firm for 2021.2023. Although ratification is not required by the Company’s Bylaws or otherwise, the Board is submitting the selection of Crowe LLP to ourthe Company’s shareholders as a matter of good corporate practice. If the selection is not ratified, the Audit Committee will consider whether it is appropriate to select another independent registered public accounting firm. Even if the selection is ratified, the Audit Committee, in its discretion, may select a different independent registered public accounting firm at any time during the year if it determines that such a change would be in the best interest of Republic and its shareholders.
The Board of Directors recommends a vote “FOR” the proposal to ratify the selection of Crowe LLP as the Company’s independent registered public accounting firm for 2021.
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AUDIT FEE TABLE | | ||||||||||||||||||||||||
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| | | | | | | | | | | | | | | AUDIT FEE TABLE | ||||||||||
Year |
| Audit Fees |
| Audit Related Fees |
| Tax Fees |
| All Other Fees |
|
| Audit Fees |
| Audit Related Fees |
| Tax Fees |
| All Other Fees | ||||||||
| | | | | | | | | | | | | | | | | | | | | | | | | |
2020 | | $ | 488,500 | | $ | — | | $ | — | | $ | 42,900 | | ||||||||||||
2019 | | $ | 418,500 | | $ | — | | $ | — | | $ | 42,000 | | ||||||||||||
| | | | | | | | | | | | | | ||||||||||||
2022 | | $ | 509,500 | | $ | 5,000 | | $ | — | | $ | 90,400 | |||||||||||||
2021 | | $ | 502,500 | | $ | — | | $ | — | | $ | 82,850 | |||||||||||||
The Audit Committee has approved all services provided by Crowe LLP during 2020.2022. Additional details describing the services provided in the categories in the above table are as follows:
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2023 PROXY STATEMENT | 71 |
Audit Fees
Crowe LLP charged $488,500$509,500 in fiscal year 20202022 and $418,500$502,500 in fiscal year 20192021 for audit fees. These include professional services in connection with the audit of the Company’s annual financial statements and its internal control
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over financial reporting. They also include reviews of the Company’s financial statements included in the Company’s Quarterly and Annual Reports on Form 10-Q and Form 10-K and for services that are normally provided by the accounting firm in connection with statutory and regulatory filings or engagements for the fiscal years shown.
Audit Related Fees
Fees for audit-related services provided by Crowe LLP in 2020,2022, as disclosed in the above “Audit Fee Table,” primarily include assistance with the review of various accounting standards. ThereFor 2022, there were $5,000 in audit related fees for review of discontinued operations disclosures, and there were no audit related fees in 2020 or 2019.2021.
All Other Fees
Fees for all other services provided by Crowe LLP, as disclosed in the above “Audit Fee Table,” relate to a 401(k) benefit plan audit, a mandated U.S. Department of Housing and Urban Development (HUD) Federal Housing Administration (FHA) compliance audit, and fees associated with the Company’s participation in an insurance captive in 20202022 and 2019.2021.
The Audit Committee of the Board of Directors has determined that the provision of the services covered under the caption “Audit Related Fees” above is compatible with maintaining the independent registered public accounting firm’s independence.
Pre-Approval Policies and Procedures
The Audit Committee’s charter provides that the committee will pre-approve all auditing services and permitted non-audit services (including the fees and terms thereof) to be performed for the Company by its independent registered public accounting firm, subject to the de minimis exceptions for non-audit services described in Section 10A(i)(1)(B) of the Securities Exchange Act of 1934 which are approved by the Audit Committee before the completion of the audit. The Audit Committee may form and delegate authority to subcommittees consisting of one or more members when appropriate, including the authority to grant pre-approvals of audit and permitted non-audit services, provided that decisions of such subcommittee to grant pre-approvals are presented to the full Audit Committee at its next scheduled meeting.
72 | Republic Bancorp, Inc. |
SHAREHOLDERS’ COMMUNICATIONS WITH THE BOARD OF DIRECTORS
Shareholders who want to communicate in writing with the Board of Directors, or specified Directors individually, may send proposed communications to Republic’s Corporate Secretary at 601 West Market Street, Louisville, Kentucky 40202. The proposed communication will be reviewed by the Audit Committee and the General Counsel. If the communication is appropriate and serves to advance or improve the Company or its performance, contains no objectionable material or language, is not unreasonable in length, and is directly applicable to the business of Republic, it is expected that the communication will receive favorable consideration for presentation to the Board of Directors or appropriate Director(s).
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2023 PROXY STATEMENT | 73 |
OTHER MATTERS
The Board of Directors does not know of any matters to be presented at the Annual Meeting other than as specified in this proxy statement. If, however, any other matters should properly come before the 2021 Annual Meeting, it is intended that the persons named in the enclosed proxy, or their substitutes, will vote such proxy in accordance with their best judgment on such matters.
74 | Republic Bancorp, Inc. |
SHAREHOLDER PROPOSALS
To be considered for inclusion in the proxy statement for the 2022 Annual Meeting2024 annual meeting of Shareholders,Republic shareholders, shareholders who desire to present proposals at such meeting must forward them in writing to the Secretary of Republic so that they are received at 601 West Market Street, Louisville, Kentucky 40202 no later than November 12, 2021; such11, 2023. Such proposals must comply with SEC requirements related to the inclusion of shareholder proposals in company-sponsored proxy materials. Any notice of a proposal submitted outside the process of Securities Exchange Act Rule 14a-8 that a shareholder intends to bring at our 2022Republic’s 2024 Annual Meeting of Shareholders should be submitted by January 22, 2022,21, 2024, and
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the proxies solicited by usthat Republic solicits for our 2022 Annual Meetingits 2024 annual meeting of shareholders will confer discretionary authority to vote on any such matters without a description of them in the proxy statement for that Annual Meeting. Shareholder proposals submitted after January 22, 202221, 2024 will be considered untimely. In accordance with Republic’s Bylaws, shareholders must provide advance notice of director nominations to be made at the Annual Meeting2024 annual meeting of Republic shareholders no later than January 22, 2022.21, 2024.
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2023 PROXY STATEMENT | 75 |
ANNUAL REPORT
Republic’s 20202022 Annual Report on Form 10-K, with certain exhibits, is enclosed with this proxy statement. The 20202022 Annual Report on Form 10-K does not form any part of the material for the solicitation of proxies.
Any shareholder who wishes to obtain a copy, without charge, of Republic’s Annual Report on Form 10-K10-K for its fiscal year ended December 31, 2020,2022, which includes financial statements and financial statement schedules, and is required to be filed with the Securities and Exchange Commission, may contact Kevin Sipes, Chief Financial Officer, at 601 West Market Street, Louisville, Kentucky 40202.
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| BY ORDER OF THE BOARD OF DIRECTORS |
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| Steven E. Trager, |
| Executive Chair and Chief Executive Officer |
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Louisville, Kentucky | |
March 10, 2023 | |
By Order of The Board of Directors
Steven E. Trager, Chairman and Chief Executive Officer
Louisville, Kentucky
March 12, 2021
PleaseYour vote at www.investorvote.com/RBCAA or mark, date, sign, and return the enclosed proxy as promptly as possible, whetheris important. Whether or not you plan to attend the 2021 virtual Annual Meeting. If you do attend the 2021 Annual Meeting, we urge you may still attend the virtual Annual Meeting andto vote online since theby submitting your proxy may be revoked at any time prior to its exercise by delivering a written revocationin advance of the meeting using one of the methods described earlier in this proxy to the Secretary of Republic.
statement under “VOTING.”
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Thanks, as always, for your
continued support.
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Republic Bancorp, Inc. Republic Corporate Center (502) 584-3600 republicbank.com | Investor Relations Mr. Kevin D. Sipes (502) 560-8628 ksipes@republicbank.com | Transfer Agent Computershare Investor Services Suite 1600 Louisville, KY 40202 (312) 588-4990 |
| 3. To, on an advisory basis, vote on the frequency of holding an advisory vote on the compensation of our Named Executive Officers. 1 |
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| Small steps make an impact. Help the environment by consenting to receive electronic delivery, sign up at www.investorvote.com/RBCAA Proxy Solicited by Board of Directors for Annual Meeting of Shareholders – April |
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