2024PROXY STATEMENT &
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
| |
| Thursday, April 25, 2024 |
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
2024PROXY STATEMENT &
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
| |
| Thursday, April 25, 2024 |
Republic Bank Building, Lower Level
9600 Brownsboro Road
Louisville, Kentucky 40241
Awards & Recognition
| |
| Newsweek’s America’s Best Regional Banks and Credit Unions |
| Newsweek named Republic Bank one of America’s Best Regional Banks and Credit Unions2024. Newsweek, in partnership with Plant-A Insights Group, conducted surveys of more than 35,000 customers and analyzed over 140,000 reviews of regional banks and credit unions to identify this prestigious list of leading institutions. Nancy Cooper, editor-in-chief, Newsweek, said, “Regional banks and credit unions play a pivotal role in meeting the needs of communities across the nation. Unlike their larger counterparts, these institutions are deeply rooted in local economies, understanding the unique needs of the people they serve.” |
| Newsweek’s Best Online Lenders in America |
| Newsweek also named Republic Bank to another important list, America’s Best Online Lenders 2024, recognizing Republic Bank’s advanced technologies in online consumer mortgage application and origination. The national rankings, a collaboration between Newsweek and LendingTree, assessed more than 2,500 financial institutions based on various criteria, including best rates offered to customers, customer satisfaction, and availability. Republic Bank received recognition for three different loan types in the Best Customer Satisfaction category and for two different loan types in the Overall category. |
| Best Places to Work in Kentucky |
| In 2023, Republic Bank was named one of the Best Places to Work in Kentucky for the seventh 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’s Top Corporate Philanthropists |
| Republic Bank and the Republic Bank Foundation were each named one of Louisville’s top corporate philanthropists in the 2023 Large Company category by Louisville Business First. Republic Bank was the only locally-based Louisville bank and the only community bank in the top 10 of all companies, as ranked by total contributions. |
MESSAGE FROM THE EXECUTIVE CHAIR
March 15, 2024
Dear Fellow Shareholders,
You are cordially invited to attend the 2024 Annual Meeting of Shareholders of Republic Bancorp, Inc. (“Republic” or the “Company”) (the “Annual Meeting”). The Annual Meeting will be held at our Springhurst location, 9600 Brownsboro Road, Louisville, Kentucky 40241 on Thursday, April 25, 2024, at 10:00 a.m. 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. 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 15 director nominees named in the Proxy Statement; and |
| ● | “FOR” the ratification of the appointment of FORVIS, LLP as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2024. |
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.
| |
By Order of the Board of Directors,
Steven E. Trager Republic Bancorp, Inc. |
|
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Our Shareholders:
You are cordially invited to attend the 2024 Annual Meeting of Shareholders (the “Annual Meeting”) of Republic Bancorp, Inc. (the “Company”). The following are details for the meeting:
5 | | | | |
| Date Thursday | |
| Time 10:00 a.m. EDT |
| | | ||
| Place Republic Bank Building, Lower Level | |
| Record Date The close of business on February 16, 2024 |
| Board | Read More | ||
| FOR each | Page 15 | ||
| ||||
| ||||
| ||||
| ||||
| ||||
| ||||
| ||||
| ||||
| ||||
| ||||
| ||||
|
| |||
|
| |||
|
| |||
|
| |||
|
| |||
| ||||
| ||||
| ||||
| ||||
| ||||
| ||||
| ||||
| ||||
|
| |||
|
| |||
|
|
| ||
|
|
| ||
|
|
| ||
|
|
| ||
|
|
| ||
|
|
| ||
|
|
| ||
|
|
| ||
|
|
| ||
|
|
| ||
|
| |||
|
| |||
|
|
| ||
|
|
| ||
|
|
| ||
|
|
| ||
|
|
| ||
|
|
| ||
|
|
| ||
|
|
| ||
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:
|
|
|
|
|
|
Items on the agenda:
To ratify the appointment of | FOR this proposal | Page 72 |
To transact such other business as may properly come before the |
| Annual Meeting or any adjournments or postponements thereof. |
| | |
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 (i) proxy materials, including the proxy statement, (ii) annual report to shareholders for the fiscal year ended December 31, 2023, and (iii) proxy card.
Your vote is important. For holders of Class A common stock 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 |
| | | ||
| 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 March 15, 2024 | Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting to be Held on April 25, 2024. Beginning on or about March 15, 2024, the Company mailed the Notice to its shareholders. Instructions for requesting a paper copy of the proxy materials are contained in the Notice. The proxy statement and annual report to shareholders are available online at www.investorvote.com/RBCAA. |
TABLE OF CONTENTS
1 | ||
| 5 | |
5 | ||
6 | ||
| | |
| 8 | |
| | |
10 | ||
| | |
15 | ||
15 | ||
| 15 | |
| 16 | |
| 16 | |
| 17 | |
Director Nominees’ Names and Principal Occupations for the Past Five Years | | 19 |
| 27 | |
| | |
| 33 | |
| | |
| 35 | |
| | |
37 | ||
40 | ||
41 | ||
42 | ||
43 | ||
46 | ||
| 49 | |
| | |
| 50 | |
| | |
51 | ||
| | |
| 53 | |
| | |
| 54 | |
| | |
| 55 | |
| | |
| 56 | |
| | |
| 57 | |
| | |
| 59 | |
| | |
| 66 | |
| | |
| 67 | |
| | |
| 68 | |
| | |
| 70 | |
| | |
Proposal Two: Ratification of Independent Registered Public Accounting Firm | | 71 |
| | |
| 75 | |
| | |
| 76 | |
| | |
| 77 | |
| | |
| 78 |
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 2024 Annual Meeting of Shareholders of Republic on April 25, 2024 and at any adjournments or postponements thereof (the “Annual Meeting”). The close of business on February |
PROXY STATEMENT SUMMARY
The Company encourages you to attend the virtual Annual Meeting. To be admitted asfollowing is only a shareholder to the Annual Meeting at www.meetingcenter.io/265018517, you must enter the control number found on yoursummary of highlights information about Republic Bancorp, Inc. and certain information contained elsewhere in this proxy card and the password is RBCA2021.
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 your 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; individual retirement accounts (IRAs); and certificates of deposit (CDs). The Bank originates residential mortgage loans, home equity loans and lines, and consumer loans, as well as commercial real estate loans, commercial and industrial (C&I) loans, business loans and lines of credit, equipment leasing through its new Republic Bank Finance division, 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 both iOS and Android devices.
Republic Bank Banking Center Locations
In 2023, Republic Bank expanded access for its clients with a net expansion of five new locations through the virtual meeting’s website. You will haveacquisition of CBank in Cincinnati, Ohio, and new banking center openings in Northern Kentucky and Tennessee. As of December 31, 2023, the ability to submit questions live atBank had 47 banking centers in communities within five metropolitan statistical areas (“MSAs”) across five states: 22 banking centers located within the virtual Annual Meeting. The Company will not limit the time allowed to ask questions. HelpLouisville/Jefferson County, Kentucky-Indiana MSA (the “Louisville MSA”) in Louisville, Prospect, Shelbyville, and technical support for accessingShepherdsville in Kentucky, and participating in the virtual meeting will be available by following instructions that will be posted at www.meetingcenter.io/265018517.Floyds Knobs,
Jeffersonville, and New Albany in Indiana; six banking centers within the Lexington-Fayette, Kentucky MSA in Georgetown and Lexington in Kentucky; eight banking centers within the Cincinnati, Ohio-Kentucky-Indiana MSA in Cincinnati and West Chester in Ohio, and Bellevue, Covington, Crestview Hills, and Florence in Kentucky; seven banking centers within the Tampa-St. Petersburg-Clearwater, Florida MSA in Largo, New Port Richey, St. Petersburg, Seminole, and Tampa in Florida; and four banking centers within the Nashville-Davidson-Murfreesboro-Franklin, Tennessee MSA in Franklin, Murfreesboro, Nashville, and Spring Hill, Tennessee. In addition, Republic Bank Finance has one loan production office in St. Louis, Missouri.
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, 2023, Republic had total assets of $6.6 billion, total deposits of $5.1 billion, and total shareholders’ equity of $913 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.
| | | | | ||||||
|
| M | | P | | A | | C | | T |
Innovate for the Future | | Make it Easy | | Provide Exceptional Service | | Acknowledge & Celebrate Success | | Commit to Caring | | Thrive Together |
| |
| |
| |
| |
| |
|
Our Beliefs
Our beliefs guide our actions to deliver on our purpose.
| | | | |
| | | | |
|
| | We believe in taking care of our associates and making it easier for them to take care of our clients. | |
|
| | | |
|
| | We believe the Company must be successful to more easily allow us to act on these other beliefs. | |
| | | | |
Our Purpose: Republic 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 Q3 2023, was 57.9, over two times the average NPS score for all banks measured in 20231. As important, this was a 31% increase from our score the previous year, 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 in Louisville, Kentucky and beyond, has provided small business clients nearly $4 million in funding and has promoted business development, expanded services, and job creation in low-to-moderate income communities. In 2023, the Bank also introduced its new Community and Multi-Cultural Banking Group that focuses on non-profits, minority-owned businesses, and developers who support underserved communities.
1Qualtrics XM Institute Q3 2023 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 (the “Bank Board” or “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 Risk Committee of the Board (the “Risk Committee”), which is tasked, in part, with overseeing operational risks, including cybersecurity, as well as the full Board. |
| ● | Ethics and Compliance 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, accounting or auditing matters, and security. Findings are investigated and reported to the Audit Committee of the Board (the “Audit Committee”). |
| ● | 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 Bank’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 Bank’s vendors, to the regular review of contracted vendors, and through to a vendor contract’s termination. |
| |
2024 PROXY STATEMENT | 3 |
Our Associates
We are taking significant actions to grow a more inclusive and diverse workplace through education, mentorship, and recruiting.
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.
Republic Bank’s “Building Bridges” program provides associates the opportunity to pair with mentors or mentees to exchange valuable Bank and business leadership skills, and to make lasting connections in the company and beyond. Formal programming and training ensure participants get the most from their mentoring experiences and continue to grow both professionally and personally. Over 200 associates have benefited from the program as mentors or mentees.
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 90% associate 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. |
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 $7.7 million has been donated to more than 700 service organizations, and associates have performed nearly 21,000 hours of volunteer service in our communities. |
| ● | During the same period, the Bank has made more than $320 million in community development loans for affordable housing, community services, and economic development and the revitalization and stabilization of underserved communities. |
| ● | Over $212 million in non-conventional mortgage loans were made to nearly 1,800 low- to moderate-income families and individuals helping them achieve the American dream of homeownership in the last three years. |
In 2023, Republic Bank began a multi-year relocation plan, bringing nearly 100 associates back to downtown Louisville from locations in Louisville’s East End. The move reflects the Bank’s commitment to creating a more vibrant downtown community in Louisville. “Republic Bank’s commitment to our downtown community is a prime example of the positive engagement we need with our businesses to become a more vibrant city,” said Louisville Mayor, Craig Greenberg. “We hope other businesses will follow suit and view downtown as a smart option for their long-term growth plans.”
4 | Republic Bancorp, Inc. |
Annual Meeting
| | |||
| |
| |
|
Thursday, April 25, 2024 | | Where Republic Bank Building, Lower Level | | 7RECORD DATE February 16, 2024 |
Voting Guide
Proposal 1: Election of 15 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 |
|
Proposal 2: Ratification of Independent Registered Public Accounting Firm (see page 71) |
The Audit Committee has selected FORVIS, LLP to serve as our independent registered public accounting firm for the fiscal year ending December 31, 2024 and is asking shareholders to ratify this selection. | OUR BOARD RECOMMENDS A VOTE FOR THIS PROPOSAL |
|
Important Notice Regarding the Availability
| |
2024 PROXY STATEMENT | 5 |
Table of Proxy MaterialsContents
|
|
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.
Snapshot of Board Nominees
| | | | | | | | | | | | | | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| | | | | Company Committee Membership March 15, 2024 | Other | |||||||||
Name | Primary Occupation | Independent | | Audit | | Compensation | | Nominating | | Risk | | Company | |||
Yoania Cannon | | VP Director, Global Brand Strategy/Analytics & Finance Capabilities at Brown-Forman Corporation |
| | | | | | | | |||||
David P. Feaster | | Retired, Consultant to Republic Bank & Trust Company | | | | | | | | | | | | ||
Jennifer N. Green | | Chief Legal Officer, Yum! Digital & Technology at Yum! Brands |
| | | | | | |
| |||||
Heather V. Howell | | Previously Director of Global Innovation and Trademark Development for the Jack Daniel Brands, Brown-Forman Corporation |
| | | | |
| | | |||||
Timothy S. Huval | | Chief Administrative Officer of Humana, Inc. |
|
| | | | | | | |||||
Ernest W. Marshall, Jr. | | Executive Vice President and Chief Human Resources Officer of Eaton Corporation |
| | |
| |
| | |
| ||||
W. Patrick Mulloy, II | | Deputy Mayor, Louisville-Jefferson County Metro Government |
|
| | | | | | ||||||
W. Kennett Oyler, III | | CEO of OPM Services, Inc. a Financial Services and Investment Firm |
| | | | | |
|
| |||||
Logan M. Pichel | | 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 |
| | | | | | | |
| | |||
Alejandro M. Sanchez | | President and CEO, Salva Financial Group of Florida |
| | | | | | | | | | | ||
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. |
| | | | | | | | | | | | | | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| | | | | Company Committee Membership March 15, 2024 | Other | |||||||||
Name | Primary Occupation | Independent | | Audit | | Compensation | | Nominating | | Risk | | Company | |||
Andrew Trager-Kusman | | Senior Vice President, Chief Strategy Officer of Republic Bank & Trust Company | | | | | | ||||||||
| | | | | | | | | | | | | | ||
Mark A. Vogt | | CEO of Galen College of Nursing |
| |
| |
| |
| | | ||||
601 West Market Street
|
|
|
Louisville, Kentucky 40202
PROXY STATEMENT
This proxy statement is furnished in connection with the solicitation
| |
2024 PROXY STATEMENT | 7 |
VOTING
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, 2021.16, 2024. On that date, 18,665,37017,252,179 shares of Class A Common Stock and 2,198,8482,150,669 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 18,665,37017,252,179 votes, and the shares of Class B Common Stock are entitled to an aggregate of 21,988,48021,506,690 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 instructionsyou are given,a shareholder of record and you return a signed and dated proxy card without marking any voting selections, 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 limitations on the authorized number of Directors;(“Director Nominees”) and (iv)(ii) “For” the ratification of CroweFORVIS, LLP as the Company’s independent registered public accounting firm for 2021.the fiscal year ending December 31, 2024. 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.
If your shares are held by your broker, bank, or other agent as your nominee, you will need to obtain a proxy card from the organization that holds your shares and follow the instructions on that form regarding how to instruct your broker, bank, or other agent to vote your shares. Brokers, banks, or other agents that have not received voting instructions from their clients cannot vote on their clients’ behalf with respect to proposals that are not “routine” but may vote their clients’ shares on “routine” proposals. A broker non-vote occurs when a broker holding shares for a beneficial owner does not vote on a particular proposal because the broker does not have discretionary voting power with respect to that proposal and has not received voting instructions from the beneficial owner (“broker non-vote”). Proposal 1 is considered a non-routine matter, and Proposal 2 is considered a routine matter. Therefore, your broker only has discretionary authority to vote your shares with respect to Proposal 2. In the absence of specific instructions from you, your broker does not have discretionary authority to vote your shares with respect to Proposal 1. Although broker non-votes are counted as shares that are present at the Annual Meeting and entitled to vote for purposes of determining the presence of a quorum, they will not be counted as votes cast and will not have any effect on voting for a non-routine proposal presented at the Annual Meeting.
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 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.
Quorum and Voting Requirements and Counting VotesShares held in Street Name.. If you hold your shares in a stock brokerage account or if your shares are heldA majority of the votes entitled to be cast on the matter 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 email a scan or image of the legal proxy to legalproxy@computershare.com no later than April 20, 2021 at 5:00 p.m., EDT, to be provided a control number, which together with the password RBCA2021, will allow the beneficial owner to be admitted as a shareholder to the Annual Meeting at www.meetingcenter.io/265018517.
2
Quorum and voting requirements and counting votes. The presencegroup, represented in person or by proxy, shall constitute a quorum of that voting group for action on that matter at the holdersAnnual Meeting.
8 | Republic Bancorp, Inc. |
There were 17,252,179 shares of the combined voting power of theour Class A Common Stock and the2,150,669 (each share of Class B Common Stock is entitled to ten (10) votes, or 21,506,690 votes) shares of our Class B Common Stock will constituteoutstanding and entitled to vote at the Annual Meeting on the record date. Therefore, a quorum for the transaction of businesswill be present if 19,379,435 votes are present in person or represented by executed proxies timely and properly received by us at the Annual Meeting. AbstentionsWithheld, 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. All other matters presented at the meetingeach director in Proposal 1. Proposal 2 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.
The following table sets forth, among other things, the vote required for approval of each of the proposals to be presented at the Annual Meeting:
Proposal | ||||||||||
| Voting Options | Vote Required for Approval | Impact of Withhold or Abstentions (as applicable) | Broker Discretionary Voting Allowed? | Effect of Broker Non-Votes | |||||
Election of Director Nominees | | FOR WITHHOLD | | At least one FOR vote. Director Nominees receiving the highest number of FOR votes are elected. If Director Nominees are unopposed, election requires only a single vote or more. | | Withheld votes have no effect; not treated as a vote cast, except for quorum purposes | | No | | No effect |
Ratification of Independent Registered Public Accounting Firm | | FOR AGAINST ABSTAIN | | More FOR votes than AGAINST votes | | Abstention votes have no effect; not treated as a vote cast, except for quorum purposes | | Yes | | Not applicable |
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, 2021,16, 2024, based on information available to the Company. On that date, 17,252,179 shares of Class A Common Stock and 2,150,669 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 (“Director(s)”) 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, 2021.16, 2024. 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 calculation16, 2024. 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 16, 2024. The calculationownership percentage of percent owned by all Directors, Nominees and Executive Officers and Directors, as a group, assumes that all such23 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 16, 2024. 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 NomineesDirectors as a group (collectively 2523 persons) beneficially own 71%approximately 73% of the combined voting power of the Class A Common Stock and Class B Common Stock, which represents 53%approximately 57% of the total number of shares of Class A Common Stock and Class B Common Stock outstanding as of February 19, 202116, 2024 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) | 45.5 | % | 1,940,091 | (2) | 88.2 | % | 10,439,218 | (1)(2) | 50.0 | % |
601 West Market Street |
| | | | | | | | | | | | |
Louisville, Kentucky 40202 |
| | | | | | | | | | | | |
|
| | | | | | | | | | | | |
Jean S. Trager |
| 8,398,288 | (3) | 45.0 | | 1,921,862 | (4) | 87.4 | | 10,320,150 | (3)(4) | 49.4 | |
601 West Market Street |
| | | | | | | | | | | | |
Louisville, Kentucky 40202 |
| | | | | | | | | | | | |
|
| | | | | | | | | | | | |
A. Scott Trager |
| 8,183,055 | (5) | 43.8 | | 1,956,647 | (6) | 89.0 | | 10,139,702 | (5)(6) | 48.6 | |
601 West Market Street |
| | | | | | | | | | | | |
Louisville, Kentucky 40202 |
| | | | | | | | | | | | |
|
| | | | | | | | | | | | |
Sheldon G. Gilman |
| 7,967,617 | (7) | 42.7 | | 1,921,862 | (8) | 87.4 | | 9,889,479 | (7)(8) | 47.4 | |
500 West Jefferson Street |
| | | | | | | | | | | | |
Suite 2100 |
| | | | | | | | | | | | |
Louisville, Kentucky 40202 |
| | | | | | | | | | | | |
|
| | | | | | | | | | | | |
Teebank Family |
| 7,165,276 | | 38.4 | | 1,753,796 | | 79.8 | | 8,919,072 | | 42.7 | |
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 | | 18,888 | (24) | * | | — | | * | | 18,888 | (24) | * | |
William R. Nelson | | 25,545 | (25) | * | | — | | * | | 25,545 | (25) | * | |
Logan M. Pichel |
| 8,341 | (26) | * | | — | | * | | 8,341 | (26) | * | |
Kevin D. Sipes |
| 77,052 | (27) | * | | — | | * | | 77,052 | (27) | * | |
A. Scott Trager | | 8,183,055 | (5) | 43.8 | | 1,956,647 | (6) | 89.0 | | 10,139,702 | (5)(6) | 48.6 | |
Steven E. Trager |
| 8,499,127 | (1) | 45.5 | | 1,940,091 | (2) | 88.2 | | 10,439,218 | (1)(2) | 50.0 | |
|
| | | | | | | | | | | | |
Directors. Nominees and All |
| | | | | | | | | | | | |
Executive Officers (25 persons): |
| 9,061,170 | (28) | 48.5 | % | 1,974,876 | (28) | 89.8 | % | 11,036,046 | (28) | 52.9 | % |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | |
| | |
| | | | | | | 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) | 48.6 | % | 1,940,091 | (2) | 90.2 | % | 10,339,218 | (1)(2) | 53.3 | % |
601 West Market Street | |
|
|
|
| |
|
|
| |
|
| |
Louisville, Kentucky 40202 | |
|
|
|
| |
|
|
| |
|
| |
| |
|
|
|
| |
|
|
| |
|
| |
Trager Trust of 2012 | | 7,915,343 | (3) | 45.8 |
| 1,921,862 | (4) | 89.4 |
| 9,837,205 | (3)(4) | 50.7 | |
601 West Market Street | |
| |
|
| | |
|
| | |
| |
Louisville, Kentucky 40202 | |
| |
|
| | |
|
| | |
| |
| |
| |
|
| | |
|
| | |
| |
A. Scott Trager | | 8,231,629 | (5) | 47.7 |
| 1,923,916 | (6) | 89.5 |
| 10,155,545 | (5)(6) | 52.3 | |
601 West Market Street | |
| |
|
| | |
|
| | |
| |
Louisville, Kentucky 40202 | |
| |
|
| | |
|
| | |
| |
| |
| |
|
| | |
|
| | |
| |
Sheldon G. Gilman | | 7,967,617 | (7) | 46.1 |
| 1,921,862 | (8) | 89.4 |
| 9,889,479 | (7)(8) | 50.9 | |
3513 Winterberry Cir | |
| |
|
| | |
|
| | |
| |
Louisville, Kentucky 40207 | |
| |
|
| | |
|
| | |
| |
| |
| |
|
| | |
|
| | |
| |
Teebank Family | | 7,165,276 | | 41.5 |
| 1,753,796 | | 81.5 |
| 8,919,072 | | 45.9 | |
Limited Partnership (9) | |
| |
|
| | |
|
| | |
| |
601 West Market Street | |
| |
|
| | |
|
| | |
| |
Louisville, Kentucky 40202 | |
| |
|
| | |
|
| | |
| |
| |
| |
|
| | |
|
| | |
| |
Jaytee Properties | | 750,067 | | 4.3 |
| 168,066 | | 7.8 |
| 918,133 | | 4.7 | |
Limited Partnership (9) | |
| |
|
| | |
|
| | |
| |
601 West Market Street | |
| |
|
| | |
|
| | |
| |
Louisville, Kentucky 40202 | |
| |
|
| | |
|
| | |
| |
| |
| |
|
| | |
|
| | |
| |
Dimensional Fund Advisors LP (10) | | 927,375 | | 5.4 |
| — | | * |
| 927,375 | | 5.4 | |
6300 Bee Cave Road | |
| |
|
| | |
|
| | |
| |
Building One | |
| |
|
| | |
|
| | |
| |
Austin, Texas 78746 | |
| |
|
| | |
|
| | |
| |
Directors, Director Nominees, and | |
| |
|
| | |
|
| | |
| |
Named Executive Officers: | |
| |
|
| | |
|
| | |
| |
| | | | | | | | | | | | | |
Yoania Cannon | | — | | * |
| — | | * |
| — | | * | |
David P. Feaster | | 2,334 | (11) | * |
| — | | * |
| 2,334 | (11) | * | |
Jennifer N. Green | | — | (12) | * |
| — | | * |
| — | (12) | * | |
Heather V. Howell | | 375 | (13) | * |
| — | | * |
| 375 | (13) | * | |
Timothy S. Huval | | — | (14) | * |
| — | | * |
| — | (14) | * | |
Ernest W. Marshall, Jr. | | 185 | (15) | * |
| — | | * |
| 185 | (15) | * | |
W. Patrick Mulloy, II | | 16,636 | (16) | * |
| — | | * |
| 16,636 | (16) | * | |
W. Kennett Oyler, III | | 1,116 | (17) | * |
| — | | * |
| 1,116 | (17) | * | |
Vidya Ravichandran | | — | (18) | * |
| — | | * |
| — | (18) | * | |
Alejandro M. Sanchez | | — | | * |
| — | | * |
| — | | * | |
Andrew Trager-Kusman | | 2,421 | (19) | * |
| — | | * |
| 2,421 | (19) | * | |
Mark A. Vogt | | 17,391 | (20) | * |
| — | | * |
| 17,391 | (20) | * | |
William R. Nelson | | 27,386 | (21) | * |
| — | | * |
| 27,386 | (21) | * | |
Logan M. Pichel | | 46,235 | (22) | * |
| — | | * |
| 46,235 | (22) | * | |
Kevin D. Sipes | | 80,777 | (23) | * |
| — | | * |
| 80,777 | (23) | * | |
Jeffrey A. Starke | | 4,587 | (24) | * |
| — | | * |
| 4,587 | (24) | * | |
A. Scott Trager | | 8,231,629 | (5) | 47.7 |
| 1,923,916 | (6) | 89.5 |
| 10,155,545 | (5)(6) | 52.3 | |
Steven E. Trager | | 8,399,127 | (1) | 48.6 |
| 1,940,091 | (2) | 90.2 |
| 10,339,218 | (1)(2) | 53.3 | |
All directors and executive officers | |
| |
|
| | |
|
| | |
| |
as a group (23 persons): | | 9,050,571 | (25) | 52.4 | % | 1,942,145 | (25) | 90.3 | % | 10,992,716 | (25) | 56.6 | % |
*Represents less than 1% of total
| |
2024 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 trustee of two trusts that |
| (3) | Includes |
4
| (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, Trager Trust of 2012, of which Steven E. Trager is |
| (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
12 | Republic Bancorp, Inc. |
| (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 |
| | | | | | | | | | | | | | | | | | |
| | | | | | | | | | |
|
|
|
|
|
|
|
|
| | 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) | Based on information disclosed in a Schedule 13G filed by |
| (11) | Does not include |
| (12) | Does not include |
| (13) | Does not include |
6
| |
2024 PROXY STATEMENT | 13 |
| (14) | Does not include |
| (15) | Does not include 5,482 shares issuable beyond 60 days of February 16, 2024 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. |
| (16) | 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 |
| (17) | Does not include |
| (18) |
| (19) | Includes voting rights for 400 restricted shares that vest in October 2026. Includes 2,000 shares for stock options held by Andrew Trager-Kusman that are exercisable within 60 days of February 16, 2024. Andrew Trager-Kusman owns Jaytee and Teebank limited partnership units, both individually and through various trusts, as disclosed in Footnote 9. Does not include |
| (20) |
| 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 |
| (21) | Includes |
| (22) | Includes |
7
| (23) | Includes 3,954 shares held by Kevin D. Sipes in Republic’s 401(k) Plan. Also includes 1,224 shares held by Kevin D. Sipes in Republic’s Employee Stock Purchase Plan. Includes voting rights for 1,500 restricted shares that vest in March 2024. Also includes voting rights for |
| (24) | Includes 708 shares held by Jeffrey A. Starke in Republic’s 401(k) Plan. Also includes 3,285 restricted shares that vest in July 2024 and 594 restricted shares that vest in January 2027. Does not include 551 shares issuable beyond 60 days of February 16, 2024 to Jeffrey A. Starke upon vesting in accordance with the terms of the Company’s Non-Employee Director and Key Employee Deferred Compensation Plan. |
| (25) | Includes the shares as described above held by the Directors |
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 Director Nominees named in this proxy statement. |
Republic’sThe 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 shall serve until his or her successor is duly elected and qualified or qualified. his or her earlier resignation or removal. All of Republic’s current Directors were elected to a one (1) year term at the most recent Annual Meeting held on April 20, 2023.
Number of Directors
Republic’s Bylaws (the “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 2021 Annual Meeting at fifteen (15).
| Mandatory | |
| | |
| 72 | |
| | |
Mandatory Retirement Age
The mandatory retirement age for a Director is seventy-two (72). At its November 2020 meeting, years old, determined as of December 31 of the Board of Directors amendedyear preceding the Bylaws to establish that aelection. A Director’s age for purposes of mandatory retirement isshall be determined as of December 31 of the year precedingprior to the Director’s election, i.e., a person can be elected as a Director if that person is under age seventy-two (72) as of December 31 of the year prior to that election. Any Director who is or reaches age seventy-two (72) during the Director’s term shall serve until the expiration of the Director’s term and shall serve until his or her successor is elected and qualified or his or her earlier resignation or removal. Two current Directors, Michael T. Rust and Susan Stout Tamme, will retire from the Board at this Annual Meeting due to the mandatory retirement age. The Company and the Bank would like to thank Mr. Rust and Ms. Tamme for their prior service as Directors.
| |
2024 PROXY STATEMENT | 15 |
2024 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:
§ Yoania Cannon § David P. Feaster § Jennifer N. Green § Heather V. Howell § Timothy S. Huval § Ernest W. Marshall, Jr. § W. Patrick Mulloy, II § W. Kennett Oyler, III | § Logan M. Pichel § Vidya Ravichandran § Alejandro M. Sanchez § A. Scott Trager § Steven E. Trager § Andrew Trager-Kusman § Mark A. Vogt |
All Director Nominees, except for Yoania Cannon and Alejandro M. Sanchez, are current members of the Board of Directors and the Bank Board. The Director Nominees would serve a one (1) year term until the Company’s 2025 annual meeting of shareholders (the “2025 Annual Meeting”) and shall serve until their successor is elected and qualified or their earlier resignation or removal.
Due to time constraints, George Nichols III chose not to run for reelection to the Board and the Bank Board of Directors. The Company and the Bank would like to thank Mr. Nichols for his prior service as a Director of the Bank from March 2020 to March 2024 and as a Director of the Company from April 2021 to April 2024.
The Nominating Committee strongly considers recommendations of the Chief Executive Officer of the Bank (“CEO/Bank”) and the Trager family members (“Trager Family Members”) (generally defined to include Steven E. Trager, who is Chair/CEO, and JeanS.Trager, the mother of Steven E. 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. In 2024, the Nominating Committee and the Board of Directors have nominatedapproved the Director Nominees to be considered for election at the Annual Meeting. No candidate that was recommended by a beneficial owner of more than fivepercent (5%) of the Company’s voting common stock was rejected. The Trager Family Members recommended all Director Nominees submitted to the Nominating Committee and the Board of Directors. No other shareholder submitted a recommendation for a Director Nominee for the Annual Meeting.
The Nominating Committee will consider candidates for Director Nominees at the 2025 Annual Meeting properly put forth by Republic 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, 2025. Shareholder nominations must be made according to the procedures contained in the Bylaws and described in this proxy statement under the heading “Shareholder Proposals”.
Any shareholder notice of nomination must include the information required by the Bylaws with respect to the nomination and all other information regarding the proposed nominee and the nominating shareholder required by Section 14 of the Securities Exchange Act of 1934, as Directors: Steven E. Trager, A. Scott Trager, Andrew Trager-Kusman, Ronald F. Barnes, Laura M. Douglas, David P. Feaster, Craig A. Greenberg,amended (the “Exchange Act”), and the rules and regulations promulgated thereunder. The Company may refuse to consider any nomination that is not timely or otherwise fails to meet the requirements of the Bylaws or the SEC’s rules with respect to the submission of director nominations. A written statement from the proposed nominee consenting to be named as a candidate and, if nominated and elected, to serve as a director should accompany any shareholder nomination.
2024 Independent Director Nominees
Non-employee Director Nominees Yoania Cannon, 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, LauraVidya Ravichandran, Alejandro M. Douglas, Craig A. Greenberg, Heather V. Howell, Ernest W. Marshall, Jr., W. Patrick Mulloy, II, George Nichols, III, W. Kenneth Oyler, III, Michael T. Rust, Susan Stout Tamme,Sanchez, 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”).
16 | Republic Bancorp, Inc. |
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.” 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 20212024 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 Nominee 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
| ||||||||
|
|
|
|
|
|
|
|
|
| Accounting | Banking | Technology | Human | Legal/ | CEO & | Environmental/ | Mergers & |
Yoania Cannon |
| | |
| |
| |
|
David P. Feaster |
|
| |
| |
| |
|
Jennifer N. Green |
|
|
|
|
|
| ||
Heather V. Howell |
| | |
| |
|
| |
Timothy S. Huval |
|
|
| |
|
|
| |
Ernest W. Marshall, Jr. |
| | |
| |
| |
|
W. Patrick Mulloy, II |
|
|
|
|
| |
| |
W. Kennett Oyler, III |
|
|
| | |
|
|
|
Logan M. Pichel |
|
| |
|
| |
| |
Vidya Ravichandran | | |
|
| |
|
|
|
Alejandro M. Sanchez |
|
|
|
|
|
|
|
|
A. Scott Trager | |
| |
| |
| | |
Steven E. Trager |
|
| |
|
|
| |
|
Andrew Trager-Kusman | |
| | | | |
|
|
Mark A. Vogt |
|
| |
| |
|
|
8
| |
2024 PROXY STATEMENT | 17 |
NASDAQ Board Diversity Rules and Matrix
The SEC approved NASDAQ Rule 5605(f) (the “Board Diversity Rule”) that requires 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 the Board Diversity Rule) 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 the Board Diversity Rule requirement having at least two applicable diverse directors prior to the December 31, 2025 compliance deadline. In further compliance with the Board Diversity Rule, the Board Diversity Matrix below provides the self-identified demographic information for the Company’s Director Nominees as of January 7, 2024. Each of the categories listed in the table below has the meaning as it is used in the Board Diversity Rule.
Board Diversity Matrix (as of January 7, 2024)
| | | | | | | | |
| | | | | | | | |
Total Number of Directors | 15 | | | | | | | |
|
| | | | | |
| Did Not |
| | Female |
| Male |
| Non-Binary |
| Disclose Gender |
Part I: Gender Identity |
|
|
|
|
|
|
|
|
Directors |
| 4 |
| 11 | | 0 |
| 0 |
Part II: Demographic Background |
|
|
|
|
|
|
|
|
African American or Black |
| 1 |
| 1 |
| 0 |
| 0 |
Asian |
| 1 |
| 0 |
| 0 |
| 0 |
Hispanic or Latinx | | 1 | | 1 | | 0 | | 0 |
White |
| 1 |
| 9 |
| 0 |
| 0 |
LGBTQ+ | 0 |
|
|
|
| |
|
|
Did Not Disclose Demographic Background | 0 |
|
|
|
| |
|
|
Our Board Diversity Matrix as of January 8, 2023 can be found in the definitive proxy statement for our 2023 annual meeting of shareholders, filed with the SEC on March 10, 2023.
18 | Republic Bancorp, Inc. |
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:
Director Nominees: | | Director |
Name and Principal Occupation for Past Five Years | Age | Since |
| | |
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 |
| | |
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. | | |
| | |
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 |
| | |
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. | | |
| | |
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 |
| | |
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. | | |
| | |
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 |
| | |
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. | | |
YOANIA CANNON | | DAVID P. FEASTER | ||
COMMITTEE: N/A Age: 43 Director Since: N/A (new 2024 nominee to both the Board and Bank Board) |
| COMMITTEES: Loan Trust - Chair Age: 70 Director of Republic since 2020 and Director of the Bank since 2019 Consultant, Republic Bank & Trust Company |
| |
KEY EXPERIENCE AND QUALIFICATIONS ● Vice President, Global Brand Strategy and Finance Capabilities with Brown-Forman Corporation since February 2023. ● Prior experience with Brown-Forman includes Director, Strategy and Brand Analytics (2020 – 2023); Finance Director Global Travel Retail and Developed APAC (2018 – 2020); Controller, Americas (2016 – 2018); Division Finance Manager, West Division (2014 – 2016); Commercial Finance Manager (2012 – 2014); Finance Sales Operations Manager (2009 – 2011); and Finance Analyst (2007 – 2009) EDUCATION ● University of Louisville, Master of Accountancy, MBA, and Bachelor of Science in Accounting HONORS AND RECOGNITIONS Ms. Cannon meets NASDAQ’s financial knowledge and sophistication requirements and qualifies as an “audit committee financial expert” under SEC rules. REASON FOR NOMINATION Based on Ms. Cannon’s managerial, business, and accounting background and her specific experience, qualifications and attributes disclosed, the Board has determined that she should be nominated to serve as a Director. | | KEY EXPERIENCE AND QUALIFICATIONS ● Retired, consultant to the Bank since 2019. ● Previously, having 47 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. | ||
9
| |
2024 PROXY STATEMENT | 19 |
| | |
Director Nominees: | | Director |
Name and Principal Occupation for Past Five Years (continued) | Age | Since |
| | |
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 |
| | |
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. | | |
| | |
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 |
| | |
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. | | |
| | |
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 |
| | |
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. | | |
| | |
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 |
| | |
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. | | |
jennifer n. green | | HEATHER V. HOWELL | ||
COMMITTEE: Risk - Chair Age: 39 Director of Republic and Director of the Bank since 2022 |
| COMMITTEE: Nominating Age: 50 Director of Republic since 2020 and Director of the Bank since 2015 |
| |
KEY EXPERIENCE AND QUALIFICATIONS ● Chief Legal Officer, Yum! Digital & Technology at Yum! Brands. Reporting to the Chief Digital & Technology Officer, leads a team of U.S.- and non-U.S.-based lawyers and legal professionals responsible for providing strategic advice and legal support on a range of matters related to the development, rollout and commercialization of internally-owned digital and technology products and services. ● Previously YUM! Brands Vice President, Global Mergers & Acquisitions (2020-2023); 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. | | KEY EXPERIENCE AND QUALIFICATIONS ● Previously Director of Global Innovation and Trademark Development for the Jack Daniel’s Family of Brands (through October 2023), 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. | ||
10
20 | Republic Bancorp, Inc. |
| | |
Director Nominees: | | Director |
Name and Principal Occupation for Past Five Years (continued) | Age | Since |
| | |
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 |
| | |
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. | | |
| | |
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 |
| | |
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. | | |
| | |
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 |
| | |
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. | | |
timothy s. huval | | eRNEST W. MARSHALL, JR. | ||
COMMITTEE: Audit Age: 57 Director of Republic and Director of the Bank since 2022 |
| COMMITTEES: Compensation - Chair Nominating Age: 55 Director of Republic since 2020 and Director of the Bank since 2017 |
| |
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 meets NASDAQ’s financial knowledge and sophistication requirements. 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. | | 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. | ||
11
| |
2024 PROXY STATEMENT | 21 |
| ||
Director Nominees: | | Director |
Name and Principal Occupation for Past Five Years (continued) | Age | Since |
| | |
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 |
| | |
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. | | |
| | |
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 |
| | |
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. | | |
| | |
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 |
| | |
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. | | |
W. PATRICK MULLOY, II | | W. KENNETT OYLER, III | ||
COMMITTEES: Audit Loan Age: 70 Director of Republic since 2020 and Director of the Bank since 2012 |
| COMMITTEE: Risk Age: 65 Director of Republic since 2020 and Director of the Bank since 2008 |
| |
KEY EXPERIENCE AND QUALIFICATIONS ● Deputy Mayor, Louisville-Jefferson County Metro Government since May 2023. ● Of Counsel with the law firm of Wyatt, Tarrant & Combs, LLP since 2022. ● Member, Advisory Board Savoy Life, LLC; 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; 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 As a member of the Audit Committee, Mr. Mulloy meets NASDAQ’s financial knowledge and sophistication requirements. 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. | | KEY EXPERIENCE AND QUALIFICATIONS ● CEO of OPM Services, Inc., a financial-services and investment firm Mr. Oyler founded in 1992. ● Executive in Residence at University of Louisville College of Business. ● 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. | ||
12
22 | Republic Bancorp, Inc. |
| ||
Director Nominees: | | Director |
Name and Principal Occupation for Past Five Years (continued) | Age | Since |
| | |
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 |
| | |
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. | | |
LOGAN M. PICHEL | | VIDYA RAVICHANDRAN | ||
COMMITTEE: Risk Age: 59 Director of Republic and Director of the Bank since 2021 President & CEO of Republic Bank & Trust Company |
| COMMITTEE: Risk Age: 51 Director of Republic and Director of the Bank since 2023 |
| |
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, Kentucky, 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. | ||
None
| |
2024 PROXY STATEMENT | 23 |
ALEJANDRO M. SANCHEZ | | a. scott trager | ||
COMMITTEE: N/A Age: 65 Director Since: N/A (new 2024 nominee to both the Board and Bank Board) |
| COMMITTEE: Loan Age: 71 Director of Republic and Director of the Bank since1990 President & Vice Chair, Republic Vice Chair, Republic Bank |
| |
KEY EXPERIENCE AND QUALIFICATIONS ● President and CEO of Salva Financial Group of Florida since 2024. ● CEO Emeritus for the Florida Bankers Association since November 2023. ● Board Director for Poplar Bank since 2023. ● Board Member for Apalachee Center Hospital, Inc. since 2022. ● Previously President and CEO for the Florida Bankers Association (1998-2023); a Board Director for Trustco Bank (2022-2023); Board Member for the Exim Bank Advisory Committee (2018-2020); and a Member of the Federal Retirement Thrift Investment Board (2002-2010). EDUCATION ● University of Iowa, College of Law, Juris Doctor ● Troy University, Bachelor of Science in Business and Social Science HONORS AND RECOGNITION ● Served in United States Air Force 1976-1981, Honorable Discharge. REASON FOR NOMINATION Based on Mr. Sanchez’s banking, managerial, business, educational, and legal background and his specific experience, qualifications, and attributes disclosed, the Board has determined that he should be nominated to serve as a Director. | | 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. | ||
24 | Republic Bancorp, Inc. |
steven e. trager | | andrew trager-kusman | ||
Age: 63 Director of Republic and Director of the Bank since1988 Executive Chair & CEO, Republic Executive Chair, Republic Bank |
| COMMITTEES: Loan Trust Age: 37 Director of Republic since 2019 and Director of the Bank since 2020 Senior Vice President, Chief Strategy Officer, Republic Bank |
| |
KEY EXPERIENCE AND QUALIFICATIONS ● Executive Chair & CEO of Republic and Executive Chair of the Bank since 2021. ● More than 30 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 ● University of Louisville Alumnus of the Year, 2023 ● 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. | | 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. | ||
| |
2024 PROXY STATEMENT | 25 |
|
|
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.
Mark A. Vogt | | |||
COMMITTEES: Audit – Chair Compensation Nominating – Chair Age: 55 Director of Republic since 2016 and Director of the Bank from 2012 to 2016 and since 2020 |
| |||
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 U.S. 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
26 | Republic Bancorp, Inc. |
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 scheduledregularly-scheduled board meetings and one special board meeting in 2020.2023. 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 directors served during their respective terms of service in 2020.2023. 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 Board committee meetings.
Company Directors and Director Nominees are expected to attend the Annual Meeting. Eleven (11) of the sixteen (16) 2023 Directors or 2023 Director Nominees attended the 2023 annual meeting of the Republic shareholders.
Leadership structure
| | |
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 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 sole authority to retain, at the Company’s expense, any outside auditors, accountants, or attorneys at their discretion. |
The Board believes that this leadership structure, coupled with strong Independent Director leadership, is the most effective and appropriate leadership model for the Company at this time. The Board believes the combined Chair/CEO structure promotes decisive leadership, ensures clear accountability and enhances our ability to communicate with a single and consistent voice to shareholders, associates, and other stakeholders.
The Company believes it has been in the best interest of shareholders that the ChairmanBoard’s Risk Oversight
The Board 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.
13
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 Board of Directors is ultimatelyare responsible for risk oversight, selected committeesoversight. The Board and Bank Board of Directors review, oversee, and approve management’s short- and long-term strategic objectives, including the Company’s Board and the Bank’s strategic planning, annual budget, significant lending and expenditures over certain limits, and other risks related to financial performance. The following Board committees and Bank Board of Directors committees also play an important role in assisting the Company’sBoard and Bank 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’sBank 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 Auditinternal 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’sBoard’s Compensation Committee (the “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 employeesassociates and risks relating to the Company’s incentive compensation programs and contractual employee
| |
2024 PROXY STATEMENT | 27 |
arrangements. In addition, theThe Compensation Committee reviews compensation and benefit plans affecting employeesassociates generally, in addition to those applicable to the NEOs. The Board has delegated management of certain employee benefits plans to the retirement committee comprised of key members of management. The Compensation Committee administers the Company’s Incentive-Based Compensation Recovery Policy (the “Clawback Policy”) and recommends Director compensation to the Board.
Nominating Committee.The Nominating Committee oversees the Board and Bank Board of Directors and related committee composition and Director succession planning. The Nominating Committee also provides a recommendation of Director independence to the Board of Directors.
Risk Committee.In November 2020,January 2024, the Bank decided that effective January 1, 2021 it would combine the Compliance and Community ReinvestmentNominating Committee recommended, and the IT Steering Committee to formBoard approved, that the Bank’s Enterprise Risk and Community Reinvestment Act Committee (“ERCRA”)become a Board committee and be renamed the Risk Committee. The Risk Committee oversees and monitors the Company’s and the Bank’s enterprise risk management practices and compliance management program, including its compliance management system and Community Reinvestment Act, third-party management, insurance, and business continuity programs. In addition, the Risk Committee assists the Board of Directors with monitoring the Company’s management of information technology and information security risks and oversight of the Company’s written information security plan and the reporting of the Company’s material risks from cybersecurity threats.
Bank Committees
Loan Committee. With respect to performcredit risk, loans are approved by Bank management and its Senior and Executive Loan Committees based on delegation set out in the following functions: Bank Board-approved Loan Policy. The Bank 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 Bank Board. Legal lending limits are reviewed by the Audit Committee 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 Bank Board Loan Committee also reviews classified assets and the allowance for credit losses calculation.
Trust Committee. The Bank Board’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 Board’s and Bank Board’s Committees
| | | | | | |
BOARD OF DIRECTORS’ Committees | ||||||
| | | | | ||
Audit | | compensation | | NOMINATING | | RISK |
◾ Financial reporting ◾ Independent auditor ◾ Internal audit function ◾ Internal controls | | ◾ Executive officer compensation ◾ Executive officer succession planning ◾ Clawback Policy | | ◾ Director nomination and ◾ Director independence ◾ Board committee composition | | ◾ Enterprise risk management ◾ Compliance management system, third-party management, insurance, and business continuity program ◾ Information technology/security activities, including oversight of |
28 | Republic Bancorp, Inc. |
| | | |
BANK BOARD’S COMMITTEES | |||
| | | |
| LOAN | | TRUST |
| ◾ Credit risk ◾ Loan portfolio growth and production ◾ Classified assets and loan allowance for credit losses | | ◾ Trust Department operations |
Committees of the Company’s Board of Directors
The Company’s Board has three (3) four (4)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, Nominating Committee, and Risk Committee, which, prior to January 2024, had been the
14
Nominating Bank Board’s Enterprise Risk and Community Reinvestment Act Committee. In accordance with SEC rules and NASDAQ listing standards, the Board, at the recommendation of the Nominating Committee, determines that each of the Board committee members on the Audit Committee, Compensation Committee, and Nominating Committee meets the definition of “independent director” and satisfies the SEC and NASDAQ listing standards for service on the Board committees on which each serves.serve, including that at least one member of the Audit Committee is an “audit committee financial expert” as defined in Item 407(d)(5)(ii) of Regulation S-K. In making these determinations, the Nominating Committee and the Board considersconsider all relevant factors.
Charters for each Company 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:committees as of March 15, 2024:
|
|
|
|
| ||
Audit Committee | | Compensation Committee |
| Nominating Committee | ||
|
|
|
|
| ||
| |
| | Heather V. Howell | | Jennifer N. Green* |
| | George Nichols III | | Ernest W. Marshall, Jr. | |
|
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, 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, Officers, and employees of the Company and the Bank. The Company intends to post amendments to, or waivers from, its Code of Conduct and Ethics Policy, if any, on its website.
The Compensation Committee held seven (7) meetings during 2020. 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 incentive plans 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, nor do any of them have any current arrangements with any compensation advisors or consultants. The CHAIR/CEO makes recommendations to the Compensation Committee with respect to all NEO compensation, including his own.
The Nominating Committee held one (1) meeting in 2020. In 2021, the Nominating Committee and the Company’s Board of Directors approved the director nominees to be considered for election at 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 submitted to the Nominating Committee or the Company’s Board of Directors for consideration by any non-management shareholder.
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 consider 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 “Trager Family Members” (generally defined to include Steven E. Trager and Jean S. Trager and their descendants, companies, partnerships, or trusts in which they are majority owners 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. 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 “Trager Family Members” recommended all Director Nominees submitted to the Nominating Committee and the Company’s Board of Directors. No other shareholders submitted a recommendation for a Director Nominee for 2021.
Thirteen of the fifteen Company Directors attended the 2020 Annual Meeting. All Company Directors and Director Nominees are requested to attend and are expected to attend the 2021 Annual Meeting.
Hedging Transactions Prohibited
The Company has an insider trading policy that, among other things, prohibits all 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 such 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 risks and rewards of ownership. When that occurs, the Director, officer or employee may no longer have the same objectives as the Company’s other shareholders. Therefore, Directors, officers and employees are prohibited from engaging in any hedging transactions.
16
COMPENSATION DISCUSSION AND ANALYSIS
The Compensation Committee, which is comprised of five independent Company 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 (“EOs”). 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 EOs 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 2020 NEOs along with other pertinent information:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
N/A–Not Applicable
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 the Company’s Acquisition 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.
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.
Purpose of the Company’s Compensation 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 a base salary that supports a reasonable lifestyle that is comparable to their high 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 and responsibilities directly associated with their NEO status.
Bonus Incentive Compensation Program. Bonus Incentive Compensation Program goals, in terms of both incentives to be paid and Gross Operating Profit (“GOP”) profit goals, are set at the beginning of the Company’s fiscal year (except for the PRES/RPG whose goals are set later in the fiscal year) by the Compensation Committee and are used to provide the NEOs and EOs 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 EOs with incentives to maximize the Company’s GOP, as well as to provide retention incentives.
Non-Employee Director and Key Employee Deferred Compensation Plan. Similarly, matching contributions made for NEOs and EOs pursuant to the Non-Employee Director and Key Employee Deferred Compensation Plan are designed to provide retention incentives.
Acquisition Bonus Plan. Acquisition Bonus Plan awards are granted to incentivize NEOs, EOs, 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.
Establishment of Compensation Levels.
The Company’s compensation elements are designed to be generally competitive with similar employment opportunities or positions in similarly sized companies. GOP for the total Company is a central metric in determining most NEO compensation. GOP is defined as “income before income tax expense” in accordance with generally accepted accounting principles (“GAAP”). The Compensation Committee 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/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. The Compensation Committee annually reviews various peer data to determine if compensation levels are within reasonable ranges as compared to those benchmarks. In 2020, the Compensation Committee made no additional compensation adjustments from the CHAIR/CEO’s recommendations based on the peer data reviewed. The Compensation Committee has not directly engaged a third-party executive compensation consultant.
The CHAIR/CEO makes specific executive compensation recommendations to the Compensation Committee on all NEO compensation elements, including his own. The CHAIR/CEO will recommend his own compensation, which, if reasonable in the subjective judgment of the Compensation Committee, is normally and historically accepted and approved by the Compensation Committee and ultimately the Board of Directors without modification. If the Company’s financial performance is deemed acceptable in the view of the CHAIR/CEO, regardless of whether or not the
18
Company’s GOP goals are met, annual increases to base salary are typically, but not always, granted 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 Compensation Committee used its collective judgment and considered the recommendations 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 Committee or the CHAIR/CEO is 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/CEO can make the recommendations to the Compensation Committee in recognition of unusual, extraordinary, or non-recurring events. These events affecting the performance of the NEO, the Company, or the financial statements of the Company could include:
As previously stated, the compensation of the NEOs is principally recommended by the CHAIR/CEO with consideration of the recommendations of each NEO’s immediate supervising executive. These recommendations, if reasonable in the subjective judgment of the 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.
The Company’s Base Salary Compensation Program. Upon the recommendation of the CHAIR/CEO, 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, based on 2020 performance and other competitive factors, along with their respective percentage increases over the prior year as shown in the table below. All base salary increases, except for the PRES/RPG, were effective January 25, 2021. The PRES/RPG will be evaluated in mid-year 2021, based primarily on the performance of the RPG business operations from October 1, 2020 to September 30, 2021.
| | | | | | |
| | | | | | |
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% | |
| | | | | | |
The Company’s Bonus Incentive Compensation Program. 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 for the total Company remains the central and most important metric in evaluating and determining most NEO compensation for the Bonus Incentive Compensation 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-recurring 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 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 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 the “Entry Level” budget goals for incentive compensation purposes are not fully achieved. Pursuant to the bonus agreement with each NEO, the Bonus Incentive Compensation Program potential is subject to amendment, either upward or downward, at the discretion of the CHAIR/CEO, subject to the approval of the Compensation Committee and ultimately the Board of Directors.
During 2020, the COVID-19 pandemic negatively impacted the Company’s overall results of operations on a net basis. Despite the challenges of the pandemic, the Company’s performance in several business units was historically strong. The Company was not forced to furlough any employees, did not initiate a reduction 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/or RPG GOP, the Company made adjustments to those GOPs and awarded 2020 bonus payouts in alignment with the NEOs’ programs described below.
20
For 2020, the Bonus Incentive Compensation Program awards for the NEOs and related factors are outlined in the table below:
| | | | | | | | | | |
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 |
| | | | | | | | | | |
Bonus Incentive Compensation Program Award for CHAIR/CEO and CFO based on Total Company GOP. The incentive bonus compensation potential for the CHAIR/CEO and the CFO is tied to the Total Company GOP. For 2020, the GOP objectives for the CHAIR/CEO and the CFO were the following:
In 2020, the higher “Maximum Level” budget goal for the CHAIR/CEO and the CFO, which usually results in the full NEO bonus potential being awarded, was not achieved. The CHAIR/CEO recommended, and 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 purpose of the CHAIR/CEO’s and CFO’s Bonus Incentive 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, the Total Company GOP would have achieved the “Mid-Level” objective for the year and bonuses for the CHAIR/CEO and CFO would have been paid out at the 85% “Mid-Level” objective. In light of the extraordinary nature of these items, 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 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, fully
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.
Bonus Incentive Compensation Program Award for PRES/RPG.Unlike other NEOs, whose goals are based on the Company’s fiscal year of January 1 through December 31, for 2020 the PRES/RPG originally had goals based on RPG’s seasonally-based measurement period from July 1, 2019 through June 30, 2020.
The incentive bonus compensation potential for the PRES/RPG is tied to the Republic Processing Group (“RPG”) GOP. For the 2020 measurement period, the RPG GOP objectives were set at the following:
Due to various business disruptions caused by the pandemic that impacted RPG during 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 in 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 Award for EVP/CMBO.The Incentive Bonus Compensation Program 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 component 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 Lending obtained a GOP of over $16.0 million
22
resulting in the EVP/CMBO receiving an award at the “Maximum Level” of $175,000 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 |
The second component focused on the Company’s mortgage loan production, with the actual bonus awarded upon whichever calculation provided the higher bonus award to the EVP/CMBO. One potential bonus calculation was 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 from the overall Company mortgage loan production any revenue generated by the banking centers and private banking group.
For the Company’s mortgage loan production, the following table describes the “Entry Level,” “Mid-Level,” and “Maximum Level” for the EVP/CMBO’s 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 the 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. The Company’s primary form of equity-based incentive compensation has historically been stock options and restricted stock awards. This form of compensation was historically used by the Company due to previously favorable accounting and tax treatment. Stock option and restricted stock awards are also granted by the Company’s competitors and the Compensation Committee believes stock option and restricted stock awards have been 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 Units (“PSUs”) constitute a favorable retention factor 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/CEO and the Compensation Committee, the significant stock holdings of the 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/CEO.
Any equity incentives for NEOs are typically recommended to the Compensation Committee by the CHAIR/CEO. 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.
The Company’s 2015 Stock Incentive Plan provides for stock option grants and various types of stock awards, including restricted stock, restricted stock units and performance stock units. For 2020, the Compensation Committee approved certain NEO equity incentive awards pursuant to the 2015 Stock Incentive Plan. The CHAIR/CEO declined to accept any stock incentive awards in 2020. The date for 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.
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:
All options granted under the 2020 Employment Agreement are exercisable for a one-year period after the vesting date and all equity awards are 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 the PRES) are to be measured in early 2022 against threshold, target and maximum performance levels, based on the achievement of return on average asset (“ROAA”) and efficiency ratio metrics as compared to the Bank’s peer group published by the Federal Financial Institutions Examination Council (“FFIEC”) in 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 vest as of December 31, 2023, if employment continues to that date.
Finally, the PRES, CFO, PRES/RPG, and other executive officers, were granted restricted shares on January 27, 2021 with a vesting date 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. All shares of stock issued under the PSUs or as restricted stock must be held by the officer for a period of two years after the vesting date, and all shares issued under the nonqualified stock options must be held for a period of two years following the exercise date.
Also, on January 27, 2021, in furtherance of its long-term incentive objectives, the Board approved Change in Control Agreements with certain executive officers, including the CFO and PRES/RPG. These agreements include two (2) year noncompete, non-solicitation and confidentiality clauses that apply whether or not a change in control occurs, and which restrictive covenants are incorporated into and part of each equity award.
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’ 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 converted into stock equivalents on a quarterly basis.
The Company’s Acquisition Bonus Plan. In addition to the incentive potential described above, certain NEOs may qualify under the Company’s Acquisition Bonus Plan for an additional incentive bonus to be determined by the CHAIR/CEO and approved by the Company’s Compensation Committee relating to Company or Bank acquisitions.
The purpose of the Acquisition Bonus Plan is to reward the job performance of associates of the Company, including certain NEOs, who materially participate in the negotiation, consummation, and transition of an acquisition or merger and contribute 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 acquisitions from time to time, and each acquisition may have a specific bonus incentive program subject to the provisions of the Acquisition Bonus Plan.
The bonus incentive pool, with respect to each acquisition, will be in an amount 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 provided 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 under the Acquisition Bonus Plan is deemed earned and vested only with respect to a participant who remains employed at the Company and is in good standing at the time of the determination. However, under certain special conditions, this requirement may be subject to waiver by the CHAIR/CEO.
During 2020, there were no acquisitions that triggered the Acquisition Bonus Plan.
Post-Employment Benefits. As 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 approved 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 months 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.
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
January 1, 2022) before April 1, 2022 or in connection with a change of control that occurs prior to January 1, 2022, as follows:
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.
Susan Stout Tamme
Susan Stout Tamme
W. Kennett Oyler, III
Mark A. Vogt, CPA*
Mark A. Vogt
Mark A. Vogt*
Logan M. Pichel
Vidya Ravichandran
* Denotes Committee Chair
| |
2024 PROXY STATEMENT | 29 |
| | | ||
Chair: | Other Members: | | | |
Mark A. Vogt, | Timothy S. Huval | W. Patrick Mulloy, II | Michael T. Rust | |
The Audit Committee held thirteen (13) meetings during 2023. The Board 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 Section407 of the Sarbanes-Oxley Act of 2002. The Board adopted a written charter for the Audit Committee, which sets out the following functions and responsibilities of the Audit Committee. The Audit Committee charter is located at www.republicbank.com.
As described in the Audit Committee 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 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 Company’s director of internal audit; and the review of the consolidated financial statements and other financial information published by the Company. The independent 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 for the Company’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions.
Compensation Committee | 2023 Meetings: 3 |
| | | ||
Chair: | Other Members: | | | |
Ernest W. Marshall, Jr. | George Nichols III | Susan Stout Tamme | Mark A. Vogt | |
The Compensation Committee held three (3)meetings during 2023. The Board adopted a written charter for the Compensation Committee, which sets out the following functions and responsibilities of the Compensation Committee. The Compensation Committee charter is located at www.republicbank.com.
At least annually, the Compensation Committee reviews and approves the compensation of the Executive Officers, including annual base salaries, short- and long-term (including cash-based and equity-based) incentive awards and opportunities, and perquisites or other personal benefits; corporate goals and objectives relevant to the Chair/CEO and Executive Officers’ compensation; evaluates the Chair/CEO and Executive Officers’ performance in light of those goals and objectives; and determines and approves the Chair/CEO and Executive Officers’ overall compensation levels based on this evaluation. Periodically, the Compensation Committee reviews and approves the succession plan for the Chair/CEO and the CEO/Bank; Executive Officer employment and severance arrangements; and Executive Officer change-in-control severance agreements and change-in-control provisions that affect any elements of Executive Officers’ compensation, benefits, and perquisites, and any special or supplemental compensation and benefits. The Compensation Committee also reviews and makes recommendations to the Board with respect to Director compensation.
30 | Republic Bancorp, Inc. |
The Compensation Committee performs the following compliance and governance functions: reviews all relevant disclosures required for this proxy statement; considers advisory votes on NEO compensation and the frequency of such votes; oversees the Company’s incentive compensation arrangements for all employees; determines, along with the Board, stock ownership guidelines for certain Executive Officers; and administers the Clawback Policy ensuring that the Clawback Policy complies with all applicable rules and regulations, consulting with the Audit Committee of the Board or the Company’s Chief Financial Officer, as applicable, in order to properly administer the Clawback Policy.
Nominating Committee | 2023 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 2023. The Board adopted a written charter for the Nominating Committee, which sets out the following functions and responsibilities of the Nominating Committee. The Nominating Committee charter is located at www.republicbank.com.
The Nominating Committee identifies, reviews, and selects potential director nominees for election to the Board, which reflect, at a minimum, all applicable laws, rules, regulations, and NASDAQ listing standards. The Nominating Committee considers 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 Trager Family Members 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.
The Nominating Committee annually reviews and makes recommendations to the Board regarding the composition, size, and structure of the Board’s committees, including the creation of additional committees or elimination of existing committees and annually recommends to the Board the members (including specified committee chairs) of each of the Board’s committees. The Nominating Committee also recommends to the Board Director independence and Director Nominees to fill vacancies and newly created directorships on the Board, as necessary.
Risk Committee | 2023 Meetings: 6 |
