AMENDMENT NUMBER ONE TO THE
SENIOR EXECUTIVE SEVERANCE AGREEMENT
Pursuant to the power reserved in Section 12 of the Senior Executive
Severance Agreement ("Agreement") made and entered into between Stock Yards
Bank and Trust Company, a Kentucky banking corporation ("Bank"), and Xxxxx X.
Xxxxxxxx ("Executive"), the Bank and the Executive hereby amend the
Agreement, effective this 25th day of February, 1997, as follows:
Section 1
By amending Section 1, DEFINITIONS, to revise the definition of "CHANGE OF
CONTROL" to read as follows:
A "CHANGE IN CONTROL" of SY Bancorp shall be deemed to have occurred
if:
(i) any Person (as defined in this definition) is or becomes the
Beneficial Owner (as defined in this definition) of securities of SY
Bancorp representing 20% or more of the combined voting power of SY
Bancorp's then outstanding securities (unless (A) such Person is the
Beneficial Owner of 20% or more of such securities as of April 26,
1995 or (B) the event causing the 20% threshold to be crossed is an
acquisition of securities directly from SY Bancorp);
(ii) during any period of two consecutive years beginning after April
26, 1995, individuals who at the beginning of such period constitute
the Board of Directors of SY Bancorp and any new director (other than
a director designated by a person who has entered into an agreement
with SY Bancorp to effect a transaction described in clause (i), (iii)
or (iv) of this Change in Control definition) whose election or
nomination for election was approved by a vote of at least two-thirds
of the directors then still in office who either were directors at the
beginning of the period or whose election or nomination for election
was previously so approved cease for any reason to constitute a
majority of the Board of Directors of SY Bancorp;
(iii) the shareholders of SY Bancorp approve a merger or consolidation
of SY Bancorp with any other corporation (other than a merger or
consolidation which would result in the voting securities of SY
Bancorp outstanding immediately prior thereto continuing to represent
(either by remaining outstanding or by being converted into voting
securities of the entity surviving such merger or consolidation), in
combination with voting securities of SY Bancorp or such surviving
entity held by a trustee or other fiduciary pursuant to any employee
benefit plan of SY Bancorp or such surviving entity or of any
subsidiary of SY Bancorp or such surviving entity, at least 80% of the
combined voting power of the securities of SY Bancorp or such
surviving entity outstanding immediately after such merger or
consolidation); or
(iv) the shareholders of SY Bancorp approve a plan of complete
liquidation or dissolution of SY Bancorp or an agreement for the sale
or disposition by SY Bancorp of all or substantially all of SY
Bancorp's assets.
(v) For purposes of the definition of Change in Control, "Person"
shall have the meaning ascribed to such term in Section 3(a)(9) of the
Securities Exchange Act of 1934, as amended, as supplemented by
Section 13(d)(3) of such Act; provided, however, that Person shall not
include (i) SY Bancorp, any subsidiary or any other Person controlled
by SY Bancorp, (ii) any trustee or other fiduciary holding securities
under any employee benefit plan of SY Bancorp or of any subsidiary, or
(iii) a corporation owned, directly or indirectly, by the shareholders
of SY Bancorp in substantially the same proportions as their ownership
of securities of SY Bancorp.
(vi) For purposes of the definition of Change in Control, a Person
shall be deemed the "Beneficial Owner" of any securities which such
Person, directly or indirectly, has the right to vote or dispose of or
has "beneficial ownership" (within the meaning of Rule 13d-3 under the
Securities Exchange Act of 1934, as amended) of, including pursuant to
any agreement, arrangement or understanding (whether or not in
writing); provided, however, that: (i) a Person shall
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not be deemed the Beneficial Owner of any security as a result of an
agreement, arrangement or understanding to vote such security (x) arising
solely from a revocable proxy or consent given in response to a public
proxy or consent solicitation made pursuant to, and in accordance with, the
Securities Exchange Act of 1934, as amended, and the applicable rules
and regulations thereunder or (y) made in connection with, or to
otherwise participate in, a proxy or consent solicitation made, or to
be made, pursuant to, and in accordance with, the applicable
provisions of the Securities Exchange Act of 1934, as amended, and the
applicable rules and regulations thereunder; in either case described
in clause (x) or clause (y) above, whether or not such agreement,
arrangement or understanding is also then reportable by such Person on
Schedule 13D under the Securities Exchange Act of 1934, as amended (or
any comparable or successor report); and (ii) a Person engaged in
business as an underwriter of securities shall not be deemed to be the
Beneficial Owner of any securities acquired through such Person's
participation in good faith in a firm commitment underwriting until
the expiration of forty days after the date of such acquisition.
Section 2
By amending Section 1, DEFINITIONS, to revise the preamble to definition of
"FORCED RESIGNATION" to read as follows:
"FORCED RESIGNATION" means a resignation at the Executive's initiative
following a Change in Control and the occurrence of any of the following
triggering events, provided such resignation occurs within twelve (12)
months after a triggering event or, if earlier, within thirty-six (36)
months after a Change in Control:
Section 3
By amending Section 1, DEFINITIONS, to add a definition of the term
"Acquisition Transaction" to read as follows:
"ACQUISITION TRANSACTION" shall be deemed to have taken place if the
shareholders of SY Bancorp approve (a) a merger or consolidation of SY
Bancorp with any other
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corporation, other than a merger or consolidation which would result
in the voting securities of SY Bancorp which are outstanding immediately
prior to such merger or consolidation continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
entity surviving such merger or consolidation) at least 80% of the voting
securities of SY Bancorp or such surviving entity outstanding immediately
after such merger or consolidation or (b) a plan of complete liquidation or
dissolution of SY Bancorp or an agreement for the sale or disposition
by SY Bancorp of all or substantially all of SY Bancorp's assets.
Section 4
By amending Section 2 to renumber the existing language in Section 2 as
Section 2(b) and to add a new Section 2(a) to read as follows:
(a)(i) SEVERANCE PAYMENT UPON INVOLUNTARY TERMINATION PRIOR TO
ACQUISITION TRANSACTION. Except as set forth in Section 2(a)(ii), if
the Executive's employment with the Bank is involuntarily terminated
by the Board of Directors of the Bank during the Term and within a
twelve month period beginning on the later of the date the Board of
Directors approves the going forward of discussions with a potential
buyer or buyers for SY Bancorp or the Bank or the date the Executive
has expressed the Executive's written opposition to such sale or
potential sale of SY Bancorp or the Bank to the Board of Directors,
the Bank shall pay the Executive (A) his full salary through the date
of such termination, which termination shall not be effective until
the later of the effective date set forth in the Notice of Termination
or two weeks following written notice to the Executive, and (B) the
Severance Payment described in this Section 2(a)(i). On the effective
date of an Acquisition Transaction which results from such
discussions, the Bank shall pay to the Executive a severance payment
equal to 299 percent of the Executive's Base Amount (the "Severance
Payment"). The Severance Payment under this Section 2(a)(i) shall be
payable to the Executive in a lump sum, in immediately available
funds, and shall be subject to any applicable
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payroll or other taxes required to be withheld. Such Severance Payment
shall be in lieu of any other severance payment provided for by the Bank
in accordance with its standard of practice and operations for Executive
at the time of payment of this Severance Payment.
(a)(ii) FORFEITURE OF SEVERANCE PAYMENT. No payment shall be
made under Section 2(a)(i) to the Executive if (A) the Executive
voluntarily divulges or otherwise discloses, directly or indirectly,
any trade secrets or other confidential information concerning the
business, policies, or sale or potential sale of SY Bancorp or the
Bank which is not lawfully attainable from public sources, unless such
disclosure is required by law or authorized by the Bank, (B) the
Executive is involuntarily terminated by the Bank for Cause, (C) the
Executive is terminated due to death, Retirement or Permanent
Disability, or (D) the Executive fails to fulfill the Executive's
responsibilities as an officer and/or director of the Bank and SY
Bancorp during the period after the above-mentioned Board of
Director's approval and while the Executive remains employed by the
Bank; provided, however, following public announcement by the Bank or
SY Bancorp of an Acquisition Transaction or proposed Acquisition
Transaction, the Executive shall not be deemed to have breached his
responsibilities as an officer or director of the Bank and SY Bancorp
and thereby to have forfeited his entitlement to the severance payment
described in Section 2(a)(i) above if he expresses publicly his
opposition to such transaction or proposed transaction, solicits votes
or proxies from shareholders of SY Bancorp against the transaction or
otherwise solicits or encourages others to oppose such transaction.
Section 5
By amending the new Section 2(b) to read as follows:
(b) SEVERANCE PAYMENT UPON TERMINATION FOLLOWING CHANGE IN CONTROL.
During the Term, if the Executive's employment with the Bank terminates
(either at the initiative of the
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Bank or the Executive) within thirty-six (36) months after a Change in
Control for any reason whatsoever other than for Cause or as a result
of the Executive's death, Retirement, or Permanent Disability, the
Bank shall pay the Executive his full salary through the date of
such termination, which termination shall not be effective until
the later of two (2) weeks following written notice thereof to the
Executive or the effective date set forth in the notice of termination. In
addition, for a termination at the initiative of the Executive (other than
a Forced Resignation) that occurs within twenty-four (24) months after a
Change in Control, the Bank shall pay the Severance Payment to the
Executive as of the effective date of such termination. For a termination
at the initiative of the Executive (other than a Forced Resignation) that
occurs more than twenty-four (24) months but less than thirty-six (36)
months after a Change in Control, the Bank shall pay the Executive as of
the effective date of such termination 2/3 of the Severance Payment. For a
termination at the Bank's initiative (other than for Cause) that occurs
within thirty-six (36) months after a Change in Control or for a Forced
Resignation, the Bank shall pay the Severance Payment to the Executive as
of the effective date of such termination. Notwithstanding any provision
to the contrary, in no event shall any Severance Payment (or portion
thereof) be paid to the Executive if the Executive's employment is
terminated for Cause or as a result of the Executive's death, Retirement,
or Permanent Disability. Further, the Severance Payment (or portion
thereof) shall be payable to the Executive in a lump sum, in immediately
available funds, on the date the Executive's termination is effective, and
shall be subject to any applicable payroll or other taxes required to be
withheld. The Severance Payment shall be in lieu of any other severance
payment provided for by the Bank in accordance with its standard of
practice and operations for Executive at the time of payment of the
Severance Payment.
Section 6
By amending Section 2 to add a new Section 2(c) to read as follows:
(c) NON-DUPLICATION OF PAYMENTS. In no event shall the Executive
receive a payment under both Sections 2(a) and 2(b), and to the extent
the Executive
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satisfies the conditions for payment under both such sections,
the Bank shall pay to the Executive the payment computed
under whichever section results in the largest payment to the
Executive.
Section 7
By amending Section 3(a), ACCRUED VACATION AND SICK PAY, to read as
follows:
The Executive shall be entitled to receive, in accordance
with the Bank's standard employment policies in effect as of
the date of this Agreement (or such more favorable policies
as exist on the date of such termination), payment for any
vacation and sick days which have accrued for the year in
which the termination occurs but have not yet been paid to
the Executive.
Section 8
By amending Section 4(a) to delete the second sentence of such section,
which prior to its deletion read as follows:
(Should the Bank determine that the payment of (a) a Severance Payment
equal to 299% of the Base Amount, plus (b) the payments provided for
in Section 3 hereof, plus (c) any other payments under this Agreement,
plus (d) any other payments payable to the Executive as a result of
his severance, cause the total of all such payments to constitute a
"parachute payment" under Section 280G of the Internal Revenue Code of
1986, then the Bank shall have the right to reduce the Severance
Payment to the highest amount payable to the Executive which does not
cause the total of all such payments to constitute a "parachute
payment".
Section 9
By amending Section 7 to replace the phrase "Section 6" with "Section 7"
wherever such phrase appears in such section, to add the words "as amended"
after the phrase "Internal Revenue Code of 1986" each time such phrase appears
in such section, and to add the following sentence at the end of Section 7:
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For purposes of the preceding sentence, to the extent the payments
made under this Agreement, together with other payments made by SY
Bancorp or the Bank to the Executive, cause the total of all such
payments to result in an "excess parachute payment" under Section 280G
of the Internal Revenue Code of 1986, as amended, an ordering rule
shall apply whereby the payments under this Agreement shall be deemed
the "excess parachute payment"; provided, however, in no event shall
the amount which is deemed to be the "excess parachute payment" for
purposes of the indemnification under this Section 7 exceed the actual
"excess parachute payment" under Section 280G of the Internal Revenue
Code of 1986, as amended, resulting from payments made to the
Executive by SY Bancorp or the Bank.
IN WITNESS WHEREOF, the parties have executed this Amendment Number One as
of the day and year first above written.
STOCK YARDS BANK AND TRUST COMPANY
By: /S/ Xxxxx X. Xxxxx
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Title: VICE CHAIRMAN OF THE BOARD
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/S/ Xxxxx X. Xxxxxxxx
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Executive
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