As filed with the Securities and Exchange Commission on April 2, 2021
Registration No. 333-254494
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Amendment No. 1
to
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
STOCK YARDS BANCORP, INC.
(Exact name of Registrant as specified in its charter)
Kentucky
6022
61-1137529
(State or other jurisdiction of
incorporation or organization)
(Primary Standard Industrial
Classification Code Number)
(I.R.S. Employer
Identification No.)
1040 East Main Street
Louisville, Kentucky 40206
(502) 582-2571
(Address, including zip code, and telephone number, including area code, of Registrant’s principal executive offices)
Mr. T. Clay Stinnett
Executive Vice President, Treasurer, and Chief Financial Officer
Stock Yards Bancorp, Inc.
1040 East Main Street
Louisville, Kentucky 40206
Phone: (502) 582-2571
(Name, address, including zip code, and telephone number, including area code, of agent for service)
Copies to:
Walter Byrne, Jr.
Stoll Keenon Ogden PLLC
300 West Vine Street
Suite 2100
Lexington, Kentucky 40502
(859) 231-3000
C. Craig Bradley, Jr.
General Counsel
Stock Yards Bancorp, Inc.
1040 East Main Street
Louisville, Kentucky 40206
(502) 582-2571
James A. Giesel
Frost Brown Todd LLC
400 West Market Street
32nd Floor
Louisville, Kentucky 40202
(502) 589-5400
Approximate date of commencement of proposed sale of the securities to the public: As soon as practicable after this Registration Statement is declared effective and upon completion of the merger described herein.
If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box.   ☐
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act of 1933, as amended (the “Securities Act”), check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.   ☐
If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.   ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
Accelerated filer
Non-accelerated filer
Smaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act.   ☐
If applicable, place an X in the box to designate the appropriate rule provision relied upon in conducting this transaction:
Exchange Act Rule 13e-4(i) (Cross-Border Issuer Tender Offer)   ☐
Exchange Act Rule 14d-1(d) (Cross-Border Third-Party Tender Offer)   ☐
The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act or until the Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.

The information in this proxy statement/prospectus is not complete and may be changed. A registration statement relating to the securities described in this proxy statement/prospectus has been filed with the U.S. Securities and Exchange Commission. These securities may not be issued until the registration statement filed with the U.S. Securities and Exchange Commission is effective. This proxy statement/prospectus does not constitute an offer to sell or the solicitation of offers to buy these securities in any jurisdiction where the offer or sale is not permitted.
PRELIMINARY — SUBJECT TO COMPLETION — DATED APRIL 2, 2021
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PROXY STATEMENT FOR SPECIAL MEETING OF
SHAREHOLDERS OF KENTUCKY BANCSHARES, INC.
and
PROSPECTUS OF STOCK YARDS BANCORP, INC.
MERGER PROPOSED — YOUR VOTE IS VERY IMPORTANT
The board of directors of each of Stock Yards Bancorp, Inc. (“Stock Yards Bancorp”) and Kentucky Bancshares, Inc. (“Kentucky Bancshares”) has unanimously approved an agreement providing for the combination of Stock Yards Bancorp and Kentucky Bancshares. Pursuant to the Agreement and Plan of Merger, dated as of January 27, 2021, by and among Stock Yards Bancorp, H. Meyer Merger Subsidiary, Inc., a Kentucky corporation and direct, wholly owned subsidiary of Stock Yards Bancorp (“Merger Sub”), and Kentucky Bancshares (as it may be amended from time to time, the “merger agreement”), Merger Sub will merge with and into Kentucky Bancshares (the “merger”), with Kentucky Bancshares as the surviving entity and a wholly owned subsidiary of Stock Yards Bancorp. Following the merger, the surviving corporation will merge with and into Stock Yards Bancorp (the “combined company”), and thereafter Kentucky Bancshares’ bank subsidiary, Kentucky Bank, will merge with and into Stock Yards Bancorp’s bank subsidiary, Stock Yards Bank & Trust Company.
In connection with the merger, holders of Kentucky Bancshares common stock (“Kentucky Bancshares shareholders”) will receive, without interest, $4.75 in cash (the “cash consideration”) and 0.64 shares (the “exchange ratio” and such shares together with the cash consideration, the “merger consideration”) of Stock Yards Bancorp common stock for each share of Kentucky Bancshares common stock they own. Holders of Stock Yards Bancorp common stock will continue to own their existing shares of Stock Yards Bancorp common stock. Based on the closing price of Stock Yards Bancorp common stock on the NASDAQ Global Select Market (the “NASDAQ”) on April 1, 2021, the last practicable trading day before the date of this proxy statement/prospectus, of $51.39, the exchange ratio represented approximately $32.89 in value for each share of Kentucky Bancshares common stock for total consideration per share of $37.64. The implied value of the Stock Yards Bancorp common stock at the time of completion of the merger could be greater than, less than or the same as the value of Stock Yards Bancorp common stock on the date of this proxy statement/prospectus. We urge you to obtain current market quotations of Stock Yards Bancorp common stock (trading symbol “SYBT”) and Kentucky Bancshares common stock (trading symbol “KTYB”).
This document is being delivered to the Kentucky Bancshares shareholders as Kentucky Bancshares’ proxy statement to solicit proxies of Kentucky Bancshares’ shareholders in connection with the approval of the merger agreement, the merger and the related matters. This document is also being delivered to the Kentucky Bancshares shareholders as Stock Yards Bancorp’s prospectus relating to Stock Yards Bancorp’s issuance of up to 3,815,281 shares of Stock Yards Bancorp common stock in connection with the merger.
Due to the continued concerns associated with the COVID-19 pandemic, in order to ensure the health and safety of our shareholders, board members, employees and advisors, and to ensure compliance with all Kentucky health directives, the special meeting of the Kentucky Bancshares shareholders will be held only by virtual means on May 13, 2021 at 11:00 a.m., local time (the “Kentucky Bancshares special meeting”). Shareholders will not be able to attend the special meeting in person but may participate by joining the live webcast.
At the Kentucky Bancshares special meeting, in addition to other business, Kentucky Bancshares will ask its shareholders to approve the merger agreement. Information about this meeting and the merger is contained in this proxy statement/prospectus. In particular, see “Risk Factors” beginning on page 43. We urge you to read this proxy statement/prospectus carefully and in its entirety.
Whether or not you plan to virtually attend the Kentucky Bancshares special meeting, please vote as soon as possible to make sure that your shares are represented at the meeting. The board of directors of Kentucky Bancshares unanimously recommends that holders of common stock vote “FOR” each of the proposals to be considered at the Kentucky Bancshares special meeting.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the securities to be issued in connection with the merger or determined if this document is accurate or complete. Any representation to the contrary is a criminal offense.
The securities to be issued in the merger are not savings or deposit accounts or other obligations of any bank or non-bank subsidiary of either Stock Yards Bancorp or Kentucky Bancshares, and they are not insured by the Federal Deposit Insurance Corporation or any other governmental agency.
This proxy statement/prospectus is dated April [  ], 2021, and is first being mailed to the Kentucky Bancshares shareholders on or about April [  ], 2021.

 
ADDITIONAL INFORMATION
This document, which forms part of a registration statement on Form S-4 filed with the Securities and Exchange Commission, or the “SEC,” by Stock Yards Bancorp (File No. 333-254494) under the Securities Act, constitutes a prospectus of Stock Yards Bancorp with respect to the shares of Stock Yards Bancorp common stock to be issued to shareholders of Kentucky Bancshares pursuant to the merger agreement. This document also constitutes a proxy statement of Kentucky Bancshares in connection with the solicitation of proxies by the Kentucky Bancshares board of directors for use at the special meeting of Kentucky Bancshares shareholders.
This proxy statement/prospectus incorporates important business and financial information about Stock Yards Bancorp and Kentucky Bancshares from other documents that are not included in or delivered with this proxy statement/prospectus. This information is available to you without charge upon your written or oral request. You can obtain the documents incorporated by reference in this document through the SEC website at http://www.sec.gov or by requesting them in writing, by email or by telephone at the appropriate address below:
Stock Yards Bancorp, Inc.
1040 East Main Street
Louisville, Kentucky 40206
Telephone: (502) 582-2571
Attention: Investor Relations
Email: clay.stinnett@syb.com
Kentucky Bancshares, Inc.
339 Main Street
P.O. Box 157
Paris, Kentucky 40361
Telephone: (859) 988-1303
Attention: Investor Relations
Email: greg.dawson@kybank.com
You will not be charged for any of these documents that you request. To obtain timely delivery of these documents, you must request them no later than five (5) business days before the date of the special meeting. This means that the Kentucky Bancshares shareholders requesting documents must do so by May 6, 2021 in order to receive them before the special meeting.
You should only rely on the information contained in or incorporated by reference into this proxy statement/prospectus. No one has been authorized to provide you with information that is different from that contained in, or incorporated by reference into, this proxy statement/prospectus. This proxy statement/prospectus is dated April [  ], 2021, and you should assume that the information in this document is accurate only as of such date. You should assume that the information incorporated by reference into this document is accurate as of the date of such incorporated document. Neither the mailing of this proxy statement/prospectus to the Kentucky Bancshares shareholders nor the issuance by Stock Yards Bancorp of shares of Stock Yards Bancorp common stock in connection with the merger will create any implication to the contrary.
This proxy statement/prospectus does not constitute an offer to sell, or a solicitation of an offer to buy, any securities, or the solicitation of a proxy, in any jurisdiction to or from any person to whom it is unlawful to make any such offer or solicitation in such jurisdiction. Except where the context otherwise indicates, information contained in, or incorporated by reference into, this document regarding Stock Yards Bancorp has been provided by Stock Yards Bancorp and information contained in, or incorporated by reference into, this document regarding Kentucky Bancshares has been provided by Kentucky Bancshares.
See the section of this proxy statement/prospectus entitled “Where You Can Find More Information” beginning on page 126 for further information about Stock Yards Bancorp and Kentucky Bancshares and a description of the documents incorporated by reference into this proxy statement/prospectus.
 

 
Kentucky Bancshares, Inc.
339 Main Street
P.O. Box 157
Paris, Kentucky 40361
Notice of Special Meeting of Shareholders to be held on May 13, 2021
To the Shareholders of Kentucky Bancshares, Inc.:
On January 27, 2021, Kentucky Bancshares, Inc. (“Kentucky Bancshares”), Stock Yards Bancorp, Inc. (“Stock Yards Bancorp”) and H. Meyer Merger Subsidiary, Inc. (“Merger Sub”) entered into an Agreement and Plan of Merger (as amended from time to time, the “merger agreement”), a copy of which is attached as Annex A to the accompanying proxy statement/prospectus.
NOTICE IS HEREBY GIVEN that a special meeting of the Kentucky Bancshares shareholders (the “Kentucky Bancshares special meeting”) will be held virtually on May 13, 2021 at 11:00 a.m., local time. We are pleased to notify you of and cordially invite you to the Kentucky Bancshares special meeting.
In light of the ongoing developments related to the COVID-19 pandemic and to protect the health of Kentucky Bancshares’ shareholders and the community, the Kentucky Bancshares special meeting will be held in a virtual-only format conducted via live audio webcast. You will be able to attend the special meeting by visiting www.meetingcenter.io/212602264 (which we refer to as the “Kentucky Bancshares special meeting website”). The password for the Kentucky Bancshares special meeting, if requested, is KTYB2021.
If you are a holder of record, you will be able to attend the Kentucky Bancshares special meeting online, ask a question and vote by visiting the Kentucky Bancshares special meeting website and following the instructions on your proxy card. If you hold your shares of Kentucky Bancshares common stock in “street name” and want to attend the Kentucky Bancshares special meeting online by webcast (with the ability to ask a question and/or vote, if you choose to do so), you must first register by obtaining a signed legal proxy from your bank, broker, trustee or other nominee giving you the right to vote the shares and submitting proof of such legal proxy along with your name and email address to legalproxy@computershare.com or Computershare, Kentucky Bancshares Legal Proxy, P.O. Box 505008, Louisville, KY 40233-9814, no later than May 11, 2021 at 5:00 p.m., Eastern Time. You will receive a confirmation of your registration by email with instructions for accessing the Kentucky Bancshares special meeting website.
At the Kentucky Bancshares special meeting, the Kentucky Bancshares shareholders will be asked to vote on the following matters:

A proposal to approve the merger agreement (the “Kentucky Bancshares merger proposal”).

A proposal to approve, on an advisory (non-binding) basis, the merger-related named executive officer compensation that will or may be paid to Kentucky Bancshares’ named executive officers in connection with the merger (the “Kentucky Bancshares compensation proposal”).

A proposal to adjourn the Kentucky Bancshares special meeting, if necessary or appropriate, to solicit additional proxies if, immediately before such adjournment, there are not sufficient votes to approve the Kentucky Bancshares merger proposal or to ensure that any supplement or amendment to the accompanying proxy statement/prospectus is timely provided to the Kentucky Bancshares shareholders (the “Kentucky Bancshares adjournment proposal”).
The Kentucky Bancshares board of directors has fixed the close of business on March 31, 2021 as the record date for the Kentucky Bancshares special meeting. Only holders of record of Kentucky Bancshares common stock as of the close of business on the record date for the Kentucky Bancshares special meeting are entitled to notice of, and to vote at, the Kentucky Bancshares special meeting or any adjournment or postponement thereof.
The Kentucky Bancshares board of directors unanimously recommends that the Kentucky Bancshares shareholders vote “FOR” the Kentucky Bancshares merger proposal, “FOR” the Kentucky Bancshares compensation proposal and “FOR” the Kentucky Bancshares adjournment proposal.
 

 
Your vote is important, regardless of the number of shares of Kentucky Bancshares common stock you own. We cannot complete the transactions contemplated by the merger agreement unless the Kentucky Bancshares shareholders approve the Kentucky Bancshares merger proposal. The affirmative vote of a majority of the outstanding shares of Kentucky Bancshares common stock entitled to vote on the merger agreement is required to approve the Kentucky Bancshares merger proposal.
Each copy of the proxy statement/prospectus mailed to the Kentucky Bancshares shareholders is accompanied by a form of proxy card with instructions for voting.
Whether or not you plan to virtually attend the Kentucky Bancshares special meeting, we urge you to please promptly complete, sign, date and return the accompanying proxy card in the enclosed postage-paid envelope or authorize the individuals named on the accompanying proxy card to vote your shares by calling the toll-free telephone number or by using the Internet as described in the instructions included with the accompanying proxy card. If your shares are held in the name of a bank, broker, trustee or other nominee, please follow the instructions on the voting instruction card furnished by such bank, broker, trustee or other nominee.
By Order of the Kentucky Bancshares Board of Directors
B. Proctor Caudill, Jr.
Chairman of the Board
April [  ], 2021 Kentucky Bancshares, Inc.
 

 
TABLE OF CONTENTS
Page
 
i

 
Page
Overview
 
ii

 
Page
 
iii

 
QUESTIONS AND ANSWERS
The following are some questions that you may have about the merger and the special meeting of holders of Kentucky Bancshares common stock (the “Kentucky Bancshares special meeting”), and brief answers to those questions. We urge you to read carefully the remainder of this proxy statement/prospectus (sometimes referred to as the “proxy statement/prospectus”) because the information in this section does not provide all of the information that might be important to you with respect to the merger and the Kentucky Bancshares special meeting. Additional important information is also contained in the documents incorporated by reference into this proxy statement/prospectus. See the section of this proxy statement/prospectus entitled “Where You Can Find More Information” beginning on page 126.
In this proxy statement/prospectus, unless the context otherwise requires:

“Stock Yards Bancorp” refers to Stock Yards Bancorp, Inc.;

“Stock Yards Bancorp common stock” refers to the common stock, no par value, of Stock Yards Bancorp;

“Kentucky Bancshares” refers to Kentucky Bancshares, Inc.;

“Kentucky Bancshares common stock” refers to the common stock, no par value per share, of Kentucky Bancshares; and

“Merger Sub” refers to H. Meyer Merger Subsidiary, Inc., a Kentucky corporation and a direct, wholly owned subsidiary of Stock Yards Bancorp.
Q:
Why am I receiving this proxy statement/prospectus?
A:
You are receiving this proxy statement/prospectus because Kentucky Bancshares has agreed to be acquired by Stock Yards Bancorp pursuant to the Agreement and Plan of Merger, dated as of January 27, 2021, by and among Stock Yards Bancorp, Merger Sub and Kentucky Bancshares (as amended from time to time, the “merger agreement”), which is attached as Annex A to this proxy statement/prospectus and is incorporated by reference herein. At the effective time, Merger Sub will merge with and into Kentucky Bancshares (the “merger”), with Kentucky Bancshares the surviving entity as a wholly owned subsidiary of Stock Yards Bancorp. Following the completion of the merger, Kentucky Bancshares, as the surviving entity of the merger, will merge (the “upstream merger”) with and into Stock Yards Bancorp, with Stock Yards Bancorp as the surviving entity (the “combined company”). Immediately following the completion of the upstream merger, or at such other time as Stock Yards Bancorp may determine, Kentucky Bank, a Kentucky state-chartered bank and wholly owned subsidiary of Kentucky Bancshares, will merge (the “bank merger”) with and into Stock Yards Bank & Trust Company, a Kentucky state-chartered bank and wholly owned subsidiary of Stock Yards Bancorp, with Stock Yards Bank & Trust Company surviving the bank merger.
To complete the merger, among other things, holders of Kentucky Bancshares common stock (the “Kentucky Bancshares shareholders”) must approve the merger agreement.
This document is also a prospectus that is being delivered to the Kentucky Bancshares shareholders because, in connection with the merger, Stock Yards Bancorp is offering shares of Stock Yards Bancorp common stock to the Kentucky Bancshares shareholders.
This proxy statement/prospectus contains important information about the merger and the other proposals being voted on at the Kentucky Bancshares special meeting. You should read it carefully and in its entirety. The enclosed materials allow you to have your shares of Kentucky Bancshares common stock voted by proxy without virtually attending the meeting. Your vote is important, and we encourage you to submit your proxy as soon as possible.
Q:
What will happen in the merger?
A:
In the merger, Merger Sub will merge with and into Kentucky Bancshares with Kentucky Bancshares surviving the merger as a wholly-owned subsidiary of Stock Yards Bancorp. Each share of Kentucky Bancshares common stock issued and outstanding immediately before the effective time of the merger
 
1

 
(the “effective time”) (except for shares of Kentucky Bancshares common stock (A) owned by Kentucky Bancshares or Stock Yards Bancorp (other than shares (x) held in trust accounts, managed accounts, mutual funds or similar accounts, or otherwise held in a fiduciary or agency capacity that are beneficially owned by third parties, or (y) held, directly or indirectly, as a result of debts previously contracted) or (B) which are issued and outstanding immediately before the effective time and which are held by persons who have properly exercised, and not withdrawn or waived, appraisal rights with respect thereto (the “Dissenting Shares”) in accordance with the Kentucky Business Corporation Act) (collectively, the “Excluded Shares”) will be converted into the right to receive 0.64 shares (the “exchange ratio”) of Stock Yards Bancorp common stock and $4.75 in cash (the “cash consideration”) per share of Kentucky Bancshares common stock (together with the shares of Stock Yards Bancorp, the “merger consideration”). After completion of the merger, Kentucky Bancshares will cease to exist, will no longer be a public company, and Kentucky Bancshares common stock will be delisted from the OTC Markets Group’s OTCQX marketplace (“OTCQX”), will be deregistered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and will cease to be publicly traded. Holders of Stock Yards Bancorp common stock (the “Stock Yards Bancorp shareholders”) will continue to own their existing shares of Stock Yards Bancorp common stock. See the information provided in the section of this proxy statement/prospectus entitled “The Merger Agreement — Structure of the Merger” beginning on page 92 and the merger agreement for more information about the merger.
Q:
When and where will the special meeting take place?
A:
Due to the health and safety concerns related to the COVID-19 pandemic, the Kentucky Bancshares special meeting will be a completely virtual meeting via live audio webcast held on May 13, 2021 at 11:00 a.m., local time at www.meetingcenter.io/212602264. The health and well-being of our shareholders, employees, directors, officers and other stakeholders are paramount. However, your virtual attendance at the meeting affords you the same rights and opportunities to participate as you would have if physically attending the meeting. Our directors, executive officers and financial and legal advisors will virtually attend the meeting and be available for questions.
In some sections, this proxy statement/prospectus refers to shareholders attending the Kentucky Bancshares special meeting “in person.” However, in all cases, those references mean virtual attendance, following the instructions that are included in this proxy statement/prospectus.
Even if you plan to attend the virtual Kentucky Bancshares special meeting, Kentucky Bancshares recommends that you vote your shares in advance so that your vote will be counted if you later decide not to or become unable to attend the Kentucky Bancshares special meeting. See “Can I vote my shares without attending the virtual Kentucky Bancshares special meeting?” below. If you hold your shares of Kentucky Bancshares common stock in “street name” and want to attend the Kentucky Bancshares special meeting online by webcast (with the ability to ask a question and/or vote, if you choose to do so), you must first register by obtaining a signed legal proxy from your bank, broker, trustee or other nominee giving you the right to vote the shares and submitting proof of such legal proxy along with your name and email address to legalproxy@computershare.com or Computershare, Kentucky Bancshares Legal Proxy, P.O. Box 505008, Louisville, KY 40233-9814, no later than May 11, 2021 at 5:00 p.m., Eastern Time. Please contact your bank, broker, trustee or other nominee to obtain further instructions.
Access to the Live Webcast of the Meeting: To access the virtual meeting, please go to www.meetingcenter.io/212602264. To gain access to the meeting, you will need to use the 15-digit control number included on the proxy card included in this mailing. If you have lost or misplaced your control number, you can enter the virtual meeting as a “guest” by selecting the “I am a Guest” button, and entering your name and email address. If you enter the virtual meeting as a guest, you will not be able to vote or ask questions. If you have questions, please contact: Kentucky Bancshares, Inc., 339 Main Street, Paris, Kentucky 40361, Attention: Gregory J. Dawson, Secretary, or call Mr. Dawson at (859) 988-1303.
Q:
How can I ask questions during the meeting?
A:
You may submit questions in advance of the meeting by visiting the website www.meetingcenter.io/
 
2

 
212602264. If you hold your shares in “street name,” you must have registered first. You may also submit questions during the live audio webcast of the Kentucky Bancshares special meeting via the Kentucky Bancshares special meeting website. Please see the section of this proxy statement/prospectus entitled “The Kentucky Bancshares Special Meeting — Proxies” beginning on page 53.
Q:
What matters will be considered at the Kentucky Bancshares special meeting?
A:
At the Kentucky Bancshares special meeting, the Kentucky Bancshares shareholders will be asked to consider and vote on the following proposals:

Kentucky Bancshares Proposal 1 — The Kentucky Bancshares merger proposal: Approval of the merger agreement (the “Kentucky Bancshares merger proposal”);

Kentucky Bancshares Proposal 2 — The Kentucky Bancshares compensation proposal: Approval of, on an advisory (non-binding) basis, the merger-related named executive officer compensation that will or may be paid to Kentucky Bancshares’ named executive officers in connection with the merger (the “Kentucky Bancshares compensation proposal”); and

Kentucky Bancshares Proposal 3 — The Kentucky Bancshares adjournment proposal: Approval of the adjournment of the Kentucky Bancshares special meeting, if necessary or appropriate, to solicit additional proxies if, immediately before such adjournment, there are not sufficient votes at the time of the Kentucky Bancshares special meeting to approve the Kentucky Bancshares merger proposal or to ensure that any supplement or amendment to this proxy statement/prospectus is timely provided to the Kentucky Bancshares shareholders (the “Kentucky Bancshares adjournment proposal”).
In order to complete the merger, among other things, the Kentucky Bancshares shareholders must approve the Kentucky Bancshares merger proposal. Neither the approval of the Kentucky Bancshares compensation proposal or the Kentucky Bancshares adjournment proposal are conditions to the obligations of Stock Yards Bancorp or Kentucky Bancshares to complete the merger.
Q:
Why do Stock Yards Bancorp and Kentucky Bancshares want to merge?
A:
The combination of Kentucky Bancshares and Stock Yards Bancorp will provide the opportunity to create efficiencies and enhance the value of the combined company while offering Kentucky Bank customers broader product offerings, increased lending capabilities and an expanded branch delivery system that stretches throughout the Louisville, Indianapolis and Northern Kentucky/Cincinnati metropolitan markets.
Q:
What will the Kentucky Bancshares shareholders receive in the merger?
A:
In the merger, the Kentucky Bancshares shareholders will receive (1) 0.64 shares of Stock Yards Bancorp common stock for each share of Kentucky Bancshares common stock held immediately before the completion of the merger (other than the Excluded Shares), and (2) $4.75 in cash for each share of Kentucky Bancshares common stock held immediately before the completion of the merger (other than the Excluded Shares). Stock Yards Bancorp will not issue any fractional shares of Stock Yards Bancorp common stock in the merger. The Kentucky Bancshares shareholders who would otherwise be entitled to a fractional share of Stock Yards Bancorp common stock in the merger will instead receive an amount in cash (rounded to the nearest cent) determined by multiplying the average of the closing-sale prices per share of Stock Yards Bancorp common stock on the NASDAQ Global Select Market (the “NASDAQ”) as reported by the Wall Street Journal for the consecutive period of five full trading days immediately preceding (but not including) the day on which the merger is completed by the fraction of a share (rounded to the nearest thousandth when expressed in decimal) of Stock Yards Bancorp common stock that such shareholder would otherwise be entitled to receive.
Q:
What will the Stock Yards Bancorp shareholders receive in the merger?
A:
In the merger, the Stock Yards Bancorp shareholders will not receive any consideration, and their shares of Stock Yards Bancorp common stock will remain outstanding and will constitute shares of the combined company. Following the merger, shares of Stock Yards Bancorp common stock will continue to be listed on the NASDAQ.
 
3

 
Q:
What percentage of the combined company will the Stock Yards Bancorp shareholders and the Kentucky Bancshares shareholders, respectively, own following the merger?
A:
Upon completion of the merger, the Stock Yards Bancorp shareholders immediately before the effective time of the merger will own approximately 85.6% of the combined company and the Kentucky Bancshares shareholders immediately before the effective time of the merger will own approximately 14.4% of the combined company.
Q:
Will the implied value of the merger consideration change between the date of this proxy statement/prospectus and the time the merger is completed?
A:
Yes. Although the ratio for the number of shares of Stock Yards Bancorp common stock that the Kentucky Bancshares shareholders will receive is fixed, the implied value of the merger consideration will fluctuate between the date of this proxy statement/prospectus and the completion of the merger based upon the market value for Stock Yards Bancorp common stock. Any net increase in the market price of Stock Yards Bancorp common stock after the date of this proxy statement/prospectus will increase the implied value of the shares of Stock Yards Bancorp common stock that the Kentucky Bancshares shareholders will receive. Any net decrease in the market price of Stock Yards Bancorp common stock after the date of this proxy statement/prospectus will decrease the implied value of the shares of Stock Yards Bancorp common stock that the Kentucky Bancshares shareholders will receive.
Q:
How will the merger affect Kentucky Bancshares restricted stock awards?
A:
Kentucky Bancshares previously made certain awards of restricted stock to its employees and management under the terms of various stock award plans previously approved by the Kentucky Bancshares shareholders. At the effective time each award of a share of Kentucky Bancshares common stock subject to vesting, repurchase or other lapse restriction (a “Kentucky Bancshares restricted stock award”), whether vested or unvested, that was outstanding as of the date of the merger agreement and remains outstanding as of immediately before the effective time will fully vest and be cancelled and converted automatically into the right to receive the merger consideration.
Q:
What are the conditions to complete the merger?
A:
The obligations of Stock Yards Bancorp and Kentucky Bancshares to complete the merger are subject to the satisfaction or waiver of certain closing conditions contained in the merger agreement, including the receipt of required regulatory approvals, a tax opinion, and approval of the Kentucky Bancshares merger proposal by the Kentucky Bancshares shareholders. For more information, see “The Merger Agreement — Conditions to Completion of the Merger” beginning on page 105.
Q:
When will the merger be completed?
A:
We will complete the merger when all of the conditions to completion contained in the merger agreement are satisfied or waived, including the receipt of required regulatory approvals and approval of the Kentucky Bancshares merger proposal by the Kentucky Bancshares shareholders. While we expect the merger to be completed in the second quarter of 2021, because fulfillment of some of the conditions to completion of the merger is not entirely within our control, we cannot assure you of the actual timing.
Q:
How does the Kentucky Bancshares board of directors recommend that I vote at the Kentucky Bancshares special meeting?
A:
The board of directors of Kentucky Bancshares (the “Kentucky Bancshares board of directors”) recommends that you vote “FOR” the Kentucky Bancshares merger proposal, “FOR” the Kentucky Bancshares compensation proposal and “FOR” the Kentucky Bancshares adjournment proposal.
In considering the recommendations of the Kentucky Bancshares board of directors, the Kentucky Bancshares shareholders should be aware that Kentucky Bancshares directors and executive officers may have interests in the merger that are different from, or in addition to, the interests of the Kentucky Bancshares shareholders generally. For a more complete description of these interests, see the information provided in the section of this proxy statement/prospectus entitled “The Merger — Interests of Kentucky Bancshares’ Directors and Executive Officers in the Merger” beginning on page 82.
 
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Q:
Who is entitled to vote at the Kentucky Bancshares special meeting?
A:
The record date for the Kentucky Bancshares special meeting is March 31, 2021. All of the Kentucky Bancshares shareholders who held shares at the close of business on the record date for the Kentucky Bancshares special meeting are entitled to receive notice of, and to vote at, the Kentucky Bancshares special meeting.
Each holder of Kentucky Bancshares common stock is entitled to cast one vote on each matter properly brought before the Kentucky Bancshares special meeting for each share of Kentucky Bancshares common stock that such holder owned of record as of the record date. As of the close of business on the record date for the Kentucky Bancshares special meeting, there were 5,961,004 outstanding shares of Kentucky Bancshares common stock. Attendance at the Kentucky Bancshares special meeting is not required to vote. See below and the section of this proxy statement/prospectus entitled “The Kentucky Bancshares Special Meeting — Proxies” beginning on page 53 for instructions on how to vote your shares without virtually attending the Kentucky Bancshares special meeting.
Q:
What constitutes a quorum for the Kentucky Bancshares special meeting?
A:
The presence virtually via the Kentucky Bancshares special meeting website or by proxy of shareholders entitled to cast a majority of all the votes entitled to be cast at the meeting constitutes a quorum. Abstentions will be included in determining the number of shares present at the meeting for the purpose of determining the presence of a quorum. If you fail to virtually attend the Kentucky Bancshares special meeting, fail to submit a proxy for the Kentucky Bancshares special meeting, or fail to instruct your bank, broker, trustee or other nominee how to vote, your shares of Kentucky Bancshares common stock will not be counted towards a quorum.
Q:
If my shares of common stock are held in “street name” by my broker, will my broker vote my shares for me?
A:
If you hold your shares in a stock brokerage account or if your shares are held by a bank, broker, trustee or other nominee (that is, in “street name”), please follow the voting instructions provided by your broker, bank, trustee or other nominee. Brokers who hold shares of Kentucky Bancshares common stock may not give a proxy to Kentucky Bancshares to vote those shares on any of the proposals without specific instructions from their customers. If your shares of Kentucky Bancshares common stock are held in street name, and you wish to attend the meeting and vote your shares, you must register by submitting proof of such legal proxy along with your name and email address to legalproxy@computershare.com or Computershare, Kentucky Bancshares Legal Proxy, P.O. Box 505008, Louisville, KY 40233-9814, no later than May 11, 2021 at 5:00 p.m., Eastern Time, to vote at the Kentucky Bancshares special meeting via the Kentucky Bancshares special meeting website.
Q:
What vote is required for the approval of each proposal at the Kentucky Bancshares special meeting?
A:
Kentucky Bancshares Proposal 1 — Kentucky Bancshares merger proposal: Approval of the Kentucky Bancshares merger proposal requires the affirmative vote of a majority of the outstanding shares of Kentucky Bancshares common stock entitled to vote on the merger agreement. Accordingly, an abstention, broker non-vote or other failure to vote will have the same effect as a vote “AGAINST” the Kentucky Bancshares merger proposal.
Kentucky Bancshares Proposal 2 — Kentucky Bancshares compensation proposal: Approval of the Kentucky Bancshares compensation proposal requires the affirmative vote of a majority of the shares of Kentucky Bancshares common stock represented in person or by proxy at the Kentucky Bancshares special meeting. Accordingly, an abstention will have the same effect as a vote “AGAINST” the Kentucky Bancshares compensation proposal. Failures to attend and broker non-votes will have no effect on the outcome of the Kentucky Bancshares compensation proposal.
Kentucky Bancshares Proposal 3 — Kentucky Bancshares adjournment proposal: Approval of the Kentucky Bancshares adjournment proposal requires the affirmative vote of a majority of the shares of Kentucky Bancshares common stock represented in person or by proxy at the Kentucky Bancshares special meeting. Accordingly, an abstention will have the same effect as a vote “AGAINST” the
 
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Kentucky Bancshares adjournment proposal. Failures to attend and broker non-votes will have no effect on the outcome of the Kentucky Bancshares adjournment proposal.
Q:
Am I required to vote on these proposals?
A:
No. You are not required to vote. However, an abstention, broker non-vote or other failure to vote will have the same effect as a vote “AGAINST” the Kentucky Bancshares merger proposal.
Q:
Are any Kentucky Bancshares shareholders already committed to vote in favor of the merger?
A:
Each member of Kentucky Bancshares’ board of directors has entered into a support agreement with Stock Yards Bancorp pursuant to which they have agreed, among other things, and unless the merger agreement is terminated, to vote their respective shares of Kentucky Bancshares common stock in favor of the approval of the merger agreement and the transactions contemplated thereby, and against alternative acquisition proposals.
Q:
Why am I being asked to consider and vote on the Kentucky Bancshares compensation proposal?
A:
Under Securities and Exchange Commission (“SEC”) rules, Kentucky Bancshares is required to seek a non-binding, advisory vote with respect to the compensation that may be paid or become payable to Kentucky Bancshares’ named executive officers that is based on or otherwise relates to the merger, or “golden parachute” compensation.
Q:
What happens if the Kentucky Bancshares shareholders do not approve, by non-binding, advisory vote, the Kentucky Bancshares compensation proposal?
A:
The vote on the proposal to approve the merger-related compensation arrangements for each of Kentucky Bancshares’ named executive officers is separate and apart from the votes to approve the other proposals being presented at the Kentucky Bancshares special meeting. Because the vote on the proposal to approve the merger-related executive compensation is advisory in nature only, it will not be binding upon Stock Yards Bancorp, Kentucky Bancshares, or the combined company in the merger. Accordingly, the merger-related compensation will be paid to Kentucky Bancshares named executive officers to the extent payable in accordance with the terms of their compensation agreements and arrangements even if the Kentucky Bancshares shareholders do not approve the proposal to approve the merger related executive compensation.
Q: What will happen if I return my proxy card without indicating how to vote?
A:
If you sign and return your proxy card without indicating how to vote on any particular proposal, the shares of Kentucky Bancshares common stock represented by your proxy will be voted as recommended by the Kentucky Bancshares board of directors with respect to such proposals, as the case may be.
Q:
How can I vote my shares virtually at the Kentucky Bancshares special meeting?
A:
Record Holders.   Shares held directly in your name as the holder of record of Kentucky Bancshares common stock may be voted at the Kentucky Bancshares special meeting. If you choose to vote your shares virtually at the Kentucky Bancshares special meeting via the Kentucky Bancshares special meeting website, please follow the instructions on your proxy card.
Shares in “street name.”   If your shares of Kentucky Bancshares common stock are held in street name, you must register by submitting proof of such legal proxy along with your name and email address to legalproxy@computershare.com or Computershare, Kentucky Bancshares Legal Proxy, P.O. Box 505008, Louisville, KY 40233-9814, no later than May 11, 2021 at 5:00 p.m., Eastern Time, to vote at the Kentucky Bancshares special meeting via the Kentucky Bancshares special meeting website. Please contact your bank, broker, trustee or other nominee to obtain further instructions.
Even if you plan to attend the Kentucky Bancshares special meeting virtually, Kentucky Bancshares recommends that you vote your shares in advance so that your vote will be counted if you later decide not to or become unable to attend the special meeting. See “Can I vote my shares without attending the virtual Kentucky Bancshares special meeting?” below.
 
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Additional information on virtually attending the Kentucky Bancshares special meeting can be found under the section of this proxy statement/prospectus entitled “The Kentucky Bancshares Special Meeting” on page 50.
Q:
What should I do if I have technical difficulties or trouble accessing the Kentucky Bancshares special meeting website?
A:
The virtual meeting platform is fully supported across Firefox, Chrome and Safari browsers and devices (desktops, laptops, tablets and cell phones) running the most up-to-date version of applicable software and plugins. Please note that Internet Explorer is not currently supported. Participants should ensure that they have a strong WiFi connection wherever they intend to participate in the meeting. We encourage you to access the meeting prior to the start time.
If you encounter any difficulties accessing the Kentucky Bancshares special meeting, please click on the “Additional Information” button on the Kentucky Bancshares special meeting website.
Q:
Can I vote my shares without attending the virtual Kentucky Bancshares special meeting?
A:
Whether you hold your shares directly as the holder of record of Kentucky Bancshares common stock or beneficially in “street name,” you may direct your vote by proxy without virtually attending the Kentucky Bancshares special meeting.
If you are a record holder of Kentucky Bancshares common stock, you can vote by proxy over the Internet, by telephone or by mail by following the instructions provided in the enclosed proxy card. Please note that if you hold shares beneficially in “street name,” you should follow the voting instructions provided by your bank, broker, trustee or other nominee.
If you intend to submit your proxy by telephone or via the Internet, you must do so by 11:59 p.m., Eastern Time, on the day before the Kentucky Bancshares special meeting. If you intend to submit your proxy by mail, your completed proxy card must be received before the Kentucky Bancshares special meeting.
If you hold your shares in a stock brokerage account or if your shares are held by a bank, broker, trustee or other nominee (that is, in “street name”), please follow the proxy voting instructions provided by your broker, bank, trustee or other nominee.
Additional information on voting procedures can be found under the section of this proxy statement/prospectus entitled “The Kentucky Bancshares Special Meeting” on page 50.
Q:
What should I do now?
A:
After carefully reading and considering the information contained or incorporated by reference in this proxy statement/prospectus, please vote as soon as possible. If you hold shares of Kentucky Bancshares common stock as a holder of record, please respond by completing, signing and dating the accompanying proxy card and returning it in the enclosed postage-paid envelope, or by submitting your proxy by telephone or through the Internet, as soon as possible so that your shares may be represented at your meeting. Please note that if you hold shares beneficially in “street name,” you should follow the voting instructions provided by your bank, broker, trustee or other nominee.
Q:
Can I change my vote after I have delivered my proxy or voting instruction card?
A:
Yes. You can change your vote at any time before your proxy is voted at your meeting. You can do this by:

submitting a written statement that you would like to revoke your proxy to the corporate secretary of Kentucky Bancshares;

signing and returning a proxy card with a later date;

virtually attending the Kentucky Bancshares special meeting, notifying the corporate secretary and voting by ballot at the Kentucky Bancshares special meeting; or
 
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voting by telephone or the Internet at a later time.
If your shares are held by a broker, bank, trustee or other nominee, you should contact your broker, bank, trustee or other nominee to change your vote.
Q:
Will Kentucky Bancshares be required to submit the Kentucky Bancshares merger proposal to its shareholders even if the Kentucky Bancshares board of directors has withdrawn, modified or qualified its recommendation?
A:
Yes. Unless the merger agreement is terminated before the Kentucky Bancshares special meeting, Kentucky Bancshares is required to submit the Kentucky Bancshares merger proposal to its shareholders even if the Kentucky Bancshares board of directors has withdrawn or modified its recommendation.
Q:
Are the Kentucky Bancshares shareholders entitled to dissenters’ rights?
A:
Yes. The Kentucky Bancshares shareholders are entitled to dissenters’ rights under the Kentucky Business Corporation Act (the “KBCA”).
Q:
What are the U.S. federal income tax consequences of the merger to Kentucky Bancshares common shareholders?
A:
The merger and the upstream merger, taken together, are intended to qualify as a “reorganization” within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended, which we refer as the “Code,” and it is a condition to the respective obligations of Stock Yards Bancorp and Kentucky Bancshares to complete the merger that each of Stock Yards Bancorp and Kentucky Bancshares receives a legal opinion to that effect. Accordingly, we expect the merger and the upstream merger, taken together, generally to be tax-free to Kentucky Bancshares common shareholders for United States federal income tax purposes with respect to the shares of Stock Yards Bancorp common stock that they receive pursuant to the merger. A Kentucky Bancshares common shareholder generally will recognize gain, but not loss, in an amount equal to the lesser of (1) the amount of gain realized (i.e., the excess of the sum of the amount of cash and the fair market value of the Stock Yards Bancorp common stock received pursuant to the merger over that holder’s adjusted tax basis in its shares of Kentucky Bancshares common stock surrendered) and (2) the amount of cash received pursuant to the merger. Further, a Kentucky Bancshares common shareholder generally will recognize gain or loss with respect to cash received instead of fractional shares of Stock Yards Bancorp common stock that the Kentucky Bancshares common shareholder would otherwise be entitled to receive. For further information, please refer to “Material U.S. Federal Income Tax Consequences of the Merger” beginning on page 111.
The United States federal income tax consequences described above may not apply to all holders of Kentucky Bancshares common stock. Your tax consequences will depend on your individual situation. Accordingly, we strongly urge you to consult your tax advisor for a full understanding of the particular tax consequences of the merger to you.
Q:
Are there any risks that I should consider in deciding whether to vote for the approval of the Kentucky Bancshares merger proposal, or the other proposals to be considered at the Kentucky Bancshares special meeting?
A:
Yes. You should read and carefully consider the risk factors set forth in the section of this proxy statement/prospectus entitled “Risk Factors” beginning on page 43. You also should read and carefully consider the risk factors of Kentucky Bancshares contained in the documents that are incorporated by reference into this proxy statement/prospectus.
Q:
What happens if the merger is not completed?
A:
If the merger is not completed, the Kentucky Bancshares shareholders will not receive any merger consideration for their shares in connection with the merger. Instead, Kentucky Bancshares will remain an independent company. If the merger is not completed, Kentucky Bancshares will have to pay various costs and expenses related to the merger that have already been incurred, even though it will not realize the expected benefits of the merger. If, at the Kentucky Bancshares special meeting, the Kentucky Bancshares shareholders do not vote to approve the merger agreement and the merger
 
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agreement is terminated, Kentucky Bancshares may be required to reimburse Stock Yards Bancorp for its out-of-pocket expenses related to the merger agreement, up to $1.8 million. In addition, if the merger agreement is terminated in certain circumstances, Kentucky Bancshares may be required to pay a termination fee. See the section of this proxy statement/prospectus entitled “The Merger Agreement — Termination Fee” beginning on page 108 for a discussion of the circumstances under which the termination fee will be required to be paid.
Q:
What happens if I sell my shares after the record date but before the Kentucky Bancshares’ special meeting?
A:
The Kentucky Bancshares record date is earlier than the date of the Kentucky Bancshares special meeting, and earlier than the date that the merger is expected to be completed. If you sell or otherwise transfer your shares of Kentucky Bancshares common stock, after the record date but before the date of the Kentucky Bancshares special meeting, you will retain your right to vote at such special meeting (provided that such shares remain outstanding on the date of such special meeting), but, with respect to Kentucky Bancshares common stock, you will not have the right to receive the merger consideration to be received by the Kentucky Bancshares shareholders in connection with the merger. In order to receive the merger consideration, you must hold your shares of Kentucky Bancshares common stock through completion of the merger.
Q:
Should I send in my stock certificates now?
A:
No. Please do not send in your Kentucky Bancshares stock certificates with your proxy. After the merger is completed, an exchange agent that is reasonably acceptable to Stock Yards Bancorp and Kentucky Bancshares (the “exchange agent”) will send you instructions for exchanging Kentucky Bancshares stock certificates for the consideration to be received in the merger. See the section of this proxy statement/prospectus entitled “The Merger Agreement — Conversion of Shares” beginning on page 93.
Q:
What should I do if I have lost or misplaced my stock certificates?
A:
You may contact our transfer agent, Computershare Investor Services, LLC, by telephone at (800) 368-5948 if you have lost your stock certificate.
Q:
How will book entry shares be handled?
A:
After the merger is completed, any book entry-only shares of Kentucky Bancshares common stock will be automatically exchanged in lieu of the merger consideration by the exchange agent. If a Kentucky Bancshares shareholder has shares both in book entry and stock certificate form, such shareholder will have to wait to exchange shares until the stock certificate(s) and letter of transmittal have been sent to the exchange agent. See the section of this proxy statement/prospectus entitled “The Merger Agreement — Conversion of Shares” beginning on page 93.
Q:
What should I do if I receive more than one set of voting materials for the same special meeting?
A:
If you hold shares of Kentucky Bancshares common stock in “street name” and also directly in your name as a holder of record or otherwise or if you hold shares of Kentucky Bancshares common stock in more than one brokerage account, you may receive more than one set of voting materials relating to the same special meeting.
Record Holders.   For shares held directly, please complete, sign, date and return each proxy card (or cast your vote by telephone or Internet as provided on each proxy card) or otherwise follow the voting instructions provided in this proxy statement/prospectus in order to ensure that all of your shares of Kentucky Bancshares common stock are voted.
Shares in “street name.”   For shares held in “street name” through a bank, broker, trustee or other nominee, you should follow the procedures provided by your bank, broker, trustee or other nominee to vote your shares.
 
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Q:
Who can help answer my questions?
A:
If you have any questions about the merger or how to submit your proxy or voting instruction card, or if you need additional copies of this document or the enclosed proxy card or voting instruction card, you should contact Louis Prichard at (859) 988-1401, James Braden at (859) 988-1314, or Greg Dawson at (859) 988-1303.
 
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SUMMARY
This summary highlights selected information in this proxy statement/prospectus and may not contain all of the information that is important to you. You should carefully read this entire proxy statement/prospectus and the other documents we refer you to for a more complete understanding of the matters being considered at the special meeting. In addition, we incorporate by reference important business and financial information about Stock Yards Bancorp and Kentucky Bancshares into this proxy statement/prospectus. You may obtain the information incorporated by reference into this proxy statement/prospectus without charge by following the instructions in the section of this proxy statement/prospectus entitled “Where You Can Find More Information” beginning on page 126.
The Parties to the Merger
Stock Yards Bancorp, Inc.
1040 East Main Street
Louisville, Kentucky 40206
(502) 582-2571
Stock Yards Bancorp, Inc. is a financial holding company, headquartered in Louisville, Kentucky. Stock Yards Bancorp, headquartered in Louisville, Kentucky, is the holding company for Stock Yards Bank & Trust, its sole subsidiary. Stock Yards Bancorp, which was incorporated in 1988 in Kentucky, is registered with, and subject to supervision, regulation and examination by, the Board of Governors of the Federal Reserve System. Stock Yards Bank & Trust, chartered in 1904, is a state-chartered non-member financial institution that provides services in the Louisville, Kentucky, Indianapolis, Indiana and Cincinnati, Ohio MSAs through 44 full service banking center locations. As of December 31, 2020, Stock Yards Bancorp had total consolidated assets of approximately $4.6 billion, total loans of approximately $3.5 billion, total deposits of approximately $4.0 billion, and total shareholders' equity of.approximately $441 million. As of December 31, 2020, Stock Yards Bancorp had approximately $3.9 billion of assets under management as part of its Wealth Management & Trust operations. Stock Yards Bank & Trust is registered with, and subject to supervision, regulation and examination by the FDIC and the Kentucky Department of Financial Institutions. The principal executive office of Stock Yards Bancorp, Inc. and Stock Yards Bank & Trust Company is located at 1040 East Main Street, Louisville, Kentucky 40206.
Stock Yards Bancorp’s common stock is traded on the NASDAQ under the symbol “SYBT.”
H. Meyer Merger Subsidiary, Inc.
c/o Stock Yards Bancorp, Inc.
1040 East Main Street
Louisville, Kentucky 40206
(502) 582-2571
H. Meyer Merger Subsidiary, Inc., which we refer to as Merger Sub, is a Kentucky corporation and a direct, wholly owned subsidiary of Stock Yards Bancorp formed solely for the purpose of facilitating the merger of Merger Sub and Kentucky Bancshares. Merger Sub has not carried on any activities or operations to date, except for those activities incidental to its formation and undertaken in connection with the transactions contemplated by the merger agreement. By operation of the merger, Merger Sub will be merged with and into Kentucky Bancshares, with Kentucky Bancshares surviving such merger as a wholly owned subsidiary of Stock Yards Bancorp.
Kentucky Bancshares, Inc.
339 Main Street, P.O. Box 157
Paris, Kentucky 40361
(859) 988-1303
Kentucky Bancshares, headquartered in Paris, Kentucky, is the holding company for Kentucky Bank, which operates 19 branches in 11 communities throughout central Kentucky serving the Lexington, Kentucky metropolitan statistical area and each of its contiguous counties. As of December 31, 2020, Kentucky Bancshares reported approximately $1.2 billion in assets, $767 million in loans, $979 million in deposits and $114 million in tangible common equity. Kentucky Bancshares also maintains a Wealth Management and
 
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Trust Department with total assets under management of $258 million at December 31, 2020.The principal executive office of Kentucky Bancshares and Kentucky Bank is located at 339 Main Street, Paris, Kentucky 40361.
Kentucky Bancshares’ common stock is traded on the OTCQX under the symbol “KTYB.”
The Merger and the Merger Agreement
The terms and conditions of the merger are contained in the merger agreement, a copy of which is attached as Annex A to this proxy statement/prospectus. You are encouraged to read the merger agreement carefully, and in its entirety, as it is the primary legal document that governs the merger.
Subject to the terms and conditions of the merger agreement, at the completion of the merger, Merger Sub will merge with and into Kentucky Bancshares, with Kentucky Bancshares as the surviving corporation. Following the completion of the merger, Kentucky Bancshares will merge with and into Stock Yards Bancorp, with Stock Yards Bancorp as the surviving corporation. Immediately following completion of the upstream merger, or at such other time as Stock Yards Bancorp may determine, Kentucky Bank, a Kentucky state-chartered bank and wholly owned subsidiary of Kentucky Bancshares, will merge with and into Stock Yards Bank & Trust Company, a Kentucky state-chartered bank and a wholly owned subsidiary of Stock Yards Bancorp.
Merger Consideration
In the merger, each share of Kentucky Bancshares common stock issued and outstanding immediately before the effective time (other than the Excluded Shares) will be converted into the right to receive $4.75 in cash and 0.64 shares of Stock Yards Bancorp common stock. No fractional shares of Stock Yards Bancorp common stock will be issued in connection with the merger, and the Kentucky Bancshares shareholders will be entitled to receive cash in lieu thereof.
Stock Yards Bancorp common stock is listed on the NASDAQ under the symbol “SYBT,” and Kentucky Bancshares common stock is listed on OTCQX under the symbol “KTYB.” The following table shows the closing sale prices of Stock Yards Bancorp common stock and Kentucky Bancshares common stock as reported on the NASDAQ and OTCQX, respectively, on January 26, 2021, the last full trading day before the public announcement of the merger agreement, and on April 1, 2021, the last practicable trading day before the date of this proxy statement/prospectus. This table also shows the implied value of the merger consideration to be issued in exchange for each share of Kentucky Bancshares common stock, which was calculated by multiplying the closing price of Stock Yards Bancorp’s common stock on those dates by the exchange ratio of 0.64 and adding $4.75 per share.
Stock Yards
Bancorp
Common Stock
Kentucky
Bancshares
Common Stock
Implied Value of
One Share of
Kentucky
Bancshares
Common Stock
January 26, 2021
$ 42.72 $ 19.01 $ 32.09
April 1, 2021
$ 51.39 $ 37.45 $ 37.64
For more information on the exchange ratio, see the section of this proxy statement/prospectus entitled “The Merger — Terms of the Merger” beginning on page 59 and the section of this proxy statement/prospectus entitled “The Merger Agreement — Merger Consideration” beginning on page 93.
Treatment of Kentucky Bancshares Restricted Stock Awards
At the effective time, each Kentucky Bancshares restricted stock award, whether vested or unvested, that was outstanding as of the date of the merger agreement and remains outstanding as of immediately before the effective time will fully vest and be cancelled and converted automatically into the right to receive the merger consideration.
 
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Interests of Kentucky Bancshares’ Directors and Executive Officers in the Merger
In considering the recommendation of the Kentucky Bancshares board of directors, the Kentucky Bancshares shareholders should be aware that the directors and executive officers of Kentucky Bancshares may have interests, including financial interests, in the merger that may be different from, or in addition to, the interests of the Kentucky Bancshares shareholders generally. The Kentucky Bancshares board of directors was aware of these interests and considered them, among other matters, in evaluating and negotiating the merger agreement, and in making its recommendation that the Kentucky Bancshares shareholders vote to approve the merger proposal. These interests are described in further detail in the section of this proxy statement/prospectus entitled “The Merger — Interests of Kentucky Bancshares’ Directors and Executive Officers in the Merger” beginning on page 82.
Kentucky Bancshares’ Reasons for the Merger; Recommendation of the Kentucky Bancshares Board of Directors
The Kentucky Bancshares board of directors has determined that the merger, the merger agreement and the transactions contemplated by the merger agreement are advisable and in the best interests of Kentucky Bancshares and its shareholders and has unanimously approved and adopted the merger agreement, the merger and the other transactions contemplated by the merger agreement. The Kentucky Bancshares board of directors unanimously recommends that the Kentucky Bancshares shareholders vote “FOR” the approval of the merger agreement and “FOR” the other proposals presented at the Kentucky Bancshares special meeting. For a more detailed discussion of the Kentucky Bancshares board of directors’ recommendation, see the section of this proxy statement/prospectus entitled “The Merger — Kentucky Bancshares’ Reasons for the Merger; Recommendation of the Kentucky Bancshares Board of Directors” beginning on page 68.
Opinion of Kentucky Bancshares’ Financial Advisor
At the January 26, 2021 board of directors meeting of Kentucky Bancshares, representatives of Raymond James & Associates, Inc. (“Raymond James”) rendered Raymond James’ oral opinion, which was subsequently confirmed by delivery of a written opinion to the Kentucky Bancshares board dated January 26, 2021, as to the fairness, as of such date, from a financial point of view, to the holders of Kentucky Bancshares’ outstanding common shares (other than Excluded Shares) of the merger consideration to be received by such holders in the merger pursuant to the merger agreement, based upon and subject to the assumptions made, procedures followed, matters considered and qualifications and limitations on the scope of the review undertaken by Raymond James in connection with the preparation of its opinion.
The full text of the written opinion of Raymond James, dated January 26, 2021, which sets forth, among other things, the various assumptions made, procedures followed, matters considered and qualifications and limitations on the scope of the review undertaken, is attached as Annex B to this proxy statement/prospectus. Raymond James provided its opinion for the information and assistance of the Kentucky Bancshares board of directors (solely in its capacity as such) in connection with, and for purposes of, its consideration of the merger and its opinion only addresses whether the merger consideration to be received by the holders of the Kentucky Bancshares common shares (other than Excluded Shares) in the merger pursuant to the merger agreement is fair, from a financial point of view, to such holders. The opinion of Raymond James did not address any other term or aspect of the merger agreement or the merger contemplated thereby, the underlying business decisions of Kentucky Bancshares to engage in the merger, the form or structure of the merger, the relative merits of the merger as compared to any other alternative business strategies that might exist for Kentucky Bancshares, or the effect of any other transaction in which Kentucky Bancshares might engage. The description of the opinion is qualified in its entirety by reference to the full text of the opinion. Kentucky Bancshares shareholders are urged to read the entire opinion carefully in connection with their consideration of the merger. Neither the Raymond James opinion nor the summary of its opinion and the related analyses set forth in this proxy statement/prospectus is intended to be or constitute advice or a recommendation to the Kentucky Bancshares board or any holder of Kentucky Bancshares common stock as to how the Kentucky Bancshares board, such shareholders or any other person should vote or otherwise act with respect to the merger or any other matter.
 
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Dissenters’ Rights in the Merger
Kentucky Bancshares shareholders are entitled to dissenters’ rights under the KBCA. For a more detailed discussion of dissenters’ rights in the merger, see the section of this proxy statement/prospectus entitled “The Merger — Dissenters’ Rights in the Merger” beginning on page 87.
Governance of the Combined Company After the Merger
Stock Yards Bancorp intends for Edwin S. Saunier and Shannon B. Arvin, two current members of the Kentucky Bancshares Board of Directors, to be added as members of the Stock Yards Bancorp board of directors and Stock Yards Bank & Trust Company board of directors after the effective time, subject to Stock Yards Bancorp’s and Stock Yards Bank & Trust Company’s corporate governance practices and policies and applicable law. The directors of the combined company will receive compensation for their service as directors. The compensation received by Stock Yards Bancorp’s directors for 2020 is described in Stock Yards Bancorp’s definitive proxy statement relating to its 2021 annual meeting of shareholders, which was filed with the SEC on March 12, 2021.
Additionally, Louis Prichard, current President and Chief Executive Officer of Kentucky Bancshares, will serve as the combined company’s Central Kentucky Market President, after the effective time.
Regulatory Approvals
Subject to the terms of the merger agreement, Stock Yards Bancorp and Kentucky Bancshares have agreed to cooperate with each other and use reasonable best efforts to promptly prepare and file all documentation to obtain as promptly as practicable all permits, consents, approvals and authorizations of all third parties, regulatory agencies, and governmental entities which are necessary to consummate the transactions contemplated by the merger agreement (including the merger, the upstream merger and the bank merger), and to comply with the terms and conditions of all such permits, consents, approvals and authorizations of all such regulatory agencies and governmental entities. These approvals include, among others, the approval of the Federal Reserve Board, the Federal Deposit Insurance Corporation (the “FDIC”) and the Kentucky Department of Financial Institutions (the “KDFI”). It will also be necessary to obtain approval of the Nevada Division of Insurance with respect to the change in control of Kentucky Bancshares’ wholly owned captive insurance subsidiary, KBI Insurance Company, Inc. (the “captive insurance subsidiary”).
Although neither Stock Yards Bancorp nor Kentucky Bancshares knows of any reason why it cannot obtain these regulatory approvals in a timely manner, Stock Yards Bancorp and Kentucky Bancshares cannot be certain when or if they will be obtained, or that the granting of these regulatory approvals will not involve the imposition of conditions on the completion of the merger or the bank merger.
Expected Timing of the Merger
Stock Yards Bancorp and Kentucky Bancshares expect the merger to close in the second quarter of 2021. However, neither Stock Yards Bancorp nor Kentucky Bancshares can predict the actual date on which the merger will be completed, or if the merger will be completed at all, because completion is subject to conditions and factors outside the control of both companies. Kentucky Bancshares must first obtain the approval of the Kentucky Bancshares shareholders for the merger. Stock Yards Bancorp and Kentucky Bancshares must also obtain necessary regulatory approvals and satisfy certain other closing conditions.
Conditions to Completion of the Merger
As more fully described in this proxy statement/prospectus and in the merger agreement, the completion of the merger depends on a number of conditions being satisfied or, where legally permissible, waived. These conditions include:

approval of the merger agreement by the Kentucky Bancshares shareholders;

the eligibility for trading on the NASDAQ of the shares of Stock Yards Bancorp common stock that will be issuable as merger consideration pursuant to the merger agreement;
 
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all regulatory authorizations, consents, orders and approvals from the Federal Reserve Board, the FDIC and the KDFI and any other approvals set forth in the merger agreement that are necessary to consummate the transactions contemplated by the merger agreement, or those other authorizations, consents, orders or approvals the failure of which to be obtained would reasonably be expected to have a material adverse effect (the “requisite regulatory approvals”) having been obtained and remaining in full force and effect, and all statutory waiting periods in respect thereof having expired, without any requisite regulatory approval resulting in the imposition of any materially burdensome regulatory condition (as that concept is defined in the merger agreement);

effectiveness of the registration statement of which this proxy statement/prospectus is a part (the “registration statement”) under the Securities Act, and the absence of any stop order suspending the effectiveness of the registration statement or proceedings for such purpose initiated or threatened by the SEC and not withdrawn;

no order, injunction, or decree issued by any court or agency of competent jurisdiction or other legal restraint or prohibition preventing the consummation of the merger or any of the other transactions contemplated by the merger agreement being in effect, and no statute, rule, regulation, order, injunction or decree having been enacted, entered, promulgated or enforced by any governmental entity which prohibits or makes illegal consummation of the merger or any of the other transactions contemplated by the merger agreement;

no material adverse effect having occurred with respect to Kentucky Bancshares or Stock Yards Bancorp;

subject to materiality standards provided in the merger agreement, the accuracy of the representations and warranties of Stock Yards Bancorp and Kentucky Bancshares in the merger agreement;

performance in all material respects by each of Stock Yards Bancorp and Kentucky Bancshares of their respective obligations under the merger agreement; and

receipt by each of Stock Yards Bancorp and Kentucky Bancshares of an opinion from counsel as to certain tax matters.
Agreement Not to Solicit Other Offers
Under the terms of the merger agreement, Kentucky Bancshares has agreed not to initiate, solicit, knowingly encourage or knowingly facilitate inquiries or proposals with respect to, or engage or participate in any negotiations concerning, or provide any confidential or nonpublic information or data to, provide any confidential or nonpublic information or data to or have or participate in any discussions with any person relating to, or approve, endorse, recommend, execute or enter into any letter of intent, agreement, or contract (other than a confidentiality agreement described in this paragraph) relating to, or that is intended to or would reasonably be expected to lead to, an acquisition proposal, or enter into any agreement, arrangement, or understanding requiring Kentucky Bancshares to abandon, terminate, or fail to consummate the merger or any other transaction contemplated by the merger agreement any acquisition proposal. Notwithstanding these restrictions, the merger agreement provides that, under specified circumstances, in response to an unsolicited bona fide written acquisition proposal which, in the good faith judgment of the Kentucky Bancshares board of directors (after receiving the advice of its outside counsel and financial advisors), is, or is more likely than not to result in, a proposal which is superior to the merger with Stock Yards Bancorp, Kentucky Bancshares may furnish nonpublic information or data regarding Kentucky Bancshares and participate in discussions or negotiations with such third party to the extent that the Kentucky Bancshares board of directors determines in good faith (after receiving the advice of its outside counsel and financial advisors) that doing so is necessary in order for such directors to comply with their fiduciary duties under applicable law, provided, further, that prior to providing any such nonpublic information or data, Kentucky Bancshares will have entered into a confidentiality agreement with such third party on terms, in all material respects, no less restrictive with respect to the third party than the confidentiality agreement between Kentucky Bancshares and Stock Yards Bancorp.
Termination of the Merger Agreement
The merger agreement may be terminated at any time prior to the effective time in the following circumstances:
 
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by mutual written consent of Stock Yards Bancorp and Kentucky Bancshares, if each of their respective boards of directors so determines by a vote of a majority of the members of each respective board of directors;

by either Stock Yards Bancorp or Kentucky Bancshares if any governmental entity that must grant a requisite regulatory approval has denied approval of the merger or the bank merger and such denial has become final and nonappealable or any governmental entity of competent jurisdiction shall have issued a final nonappealable law or order permanently enjoining or otherwise prohibiting or making illegal the consummation of the merger or the bank merger, unless the failure to obtain a requisite regulatory approval shall be due to the failure of the party seeking to terminate the merger agreement to perform or observe the covenants and agreements of such party set forth in the merger agreement;

by either Stock Yards Bancorp or Kentucky Bancshares if the merger shall not have been consummated on or before January 1, 2022 (the “outside date”), unless the failure of the closing to occur by the outside date shall be due primarily to the failure of the party seeking to terminate the merger agreement to perform or observe the covenants and agreements of such party set forth in the merger agreement and that failure has caused or resulted in (1) the failure to satisfy the conditions to closing set forth in the merger agreement prior to the outside date or (2) the failure of the closing to have occurred prior to the outside date;

by either Stock Yards Bancorp or Kentucky Bancshares if the Kentucky Bancshares shareholder vote to approve the merger is not obtained at the Kentucky Bancshares special meeting (or at any adjournment or postponement thereof), provided that no party may terminate the merger agreement in accordance with the foregoing if the party seeking to terminate the merger agreement has breached the merger agreement in any material respect in a manner that primarily caused the failure to obtain the required Kentucky Bancshares shareholder vote to approve the merger at the Kentucky Bancshares special meeting (or at any adjournment or postponement thereof);

by either Stock Yards Bancorp or Kentucky Bancshares (provided the party seeking termination is not then in material breach of any representation, warranty, covenant or other agreement contained in the merger agreement) if the other party has breached any representations, warranties, covenants or agreements contained in the merger agreement (or any representation or warranty has ceased to be true), and such breach (or failure of a representation or warranty to be true), either individually or in the aggregate with all other breaches by the party (or failures of representations or warranties to be true), would constitute, if occurring or continuing on the closing date, the failure of a specified condition to closing in the terminating party’s favor under the merger agreement, and which is not cured by the earlier of the outside date or within 30 days (or the period of fewer days remaining until the outside date) following written notice from the terminating party to the other party, or which breach or failure by its nature or timing cannot be cured during such period;

by Kentucky Bancshares if (1) the Kentucky Bancshares board of directors (or a duly authorized committee thereof) has authorized Kentucky Bancshares to enter into an alternative acquisition agreement with respect to a superior proposal, (2) Kentucky Bancshares has complied in all respects with its obligations under the merger agreement as described in the section of this proxy statement/prospectus entitled “The Merger Agreement — Non-Solicitation and Requirements for a Change of Recommendation” with respect to soliciting acquisition proposals and making a change of recommendation, and (3) in the case of the scenario described above in part (1) of this bullet point, immediately after termination of the merger agreement Kentucky Bancshares enters into an alternative acquisition agreement, with respect to a superior proposal referred to in part (1) of this bullet point; provided, that Kentucky Bancshares’ right to terminate the merger agreement with respect to a superior proposal as described in this section is conditioned on and subject to the prior payment by Kentucky Bancshares to Stock Yards Bancorp of the termination fee in accordance with the merger agreement;

by Stock Yards Bancorp prior to such time as the required Kentucky Bancshares shareholder vote to approve the merger is obtained, if (1) Kentucky Bancshares’ board of directors has (A) failed to include the board recommendation in the proxy statement, or withdrawn, modified or qualified the
 
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board recommendation in a manner adverse to Stock Yards Bancorp, or publicly disclosed that it intends to do so, or failed to recommend against acceptance of a tender offer or exchange offer constituting an acquisition proposal that has been publicly disclosed within 10 business days after the commencement of such tender or exchange offer, in any such case whether or not permitted by the terms of the merger agreement, or (B) recommended or endorsed an acquisition proposal or publicly disclosed its intention to do so, or failed to issue a press release announcing its unqualified opposition to such acquisition proposal within 10 business days after an acquisition proposal is publicly announced, or (2) Kentucky Bancshares or its board of directors has breached its obligations under the merger agreement as to obtaining its shareholders’ approval of the merger, making the board recommendation, soliciting acquisition proposals, or making a change of recommendation, in any material respect; or

by Stock Yards Bancorp if greater than 5% of the outstanding shares of Kentucky Bancshares common stock have become and remain dissenting shares.
Termination Payments
Under certain circumstances, if the merger agreement is terminated by Stock Yards Bancorp or Kentucky Bancshares, Kentucky Bancshares may be required to make a termination payment to Stock Yards Bancorp. If the merger agreement is terminated by Stock Yards Bancorp or Kentucky Bancshares, including circumstances involving alternative acquisition proposals and changes in the recommendation of the Kentucky Bancshares board of directors, Kentucky Bancshares may be required to pay a termination fee to Stock Yards Bancorp of $7.25 million (the “termination fee”). Additionally, if the Kentucky Bancshares board of directors, in exercising its fiduciary obligations, terminates the merger agreement to pursue an alternative acquisition proposal that is determined to be superior and enters into another definitive agreement related to the superior proposal, Kentucky Bancshares would be required to pay the termination fee to Stock Yards Bancorp.
If, at the Kentucky Bancshares special meeting, the Kentucky Bancshares shareholders do not vote to approve the merger agreement and the merger agreement is terminated, Kentucky Bancshares may be required to reimburse Stock Yards Bancorp for its out-of-pocket expenses related to the merger agreement, up to $1.8 million (the “reimbursement payment”).
In no circumstance will the termination of the merger agreement require Kentucky Bancshares to pay both the termination fee and the reimbursement payment.
Also, if the merger agreement is terminated and Kentucky Bancshares is required to pay the termination fee or the reimbursement payment, such payment is considered an exclusive remedy for Stock Yards Bancorp.
Amendment, Waiver and Extension of the Merger Agreement
Stock Yards Bancorp and Kentucky Bancshares may jointly amend the merger agreement, and each of Stock Yards Bancorp and Kentucky Bancshares may waive its right to require the other party to comply with particular provisions of the merger agreement. However, Stock Yards Bancorp and Kentucky Bancshares may not amend the merger agreement or waive their respective rights after the Kentucky Bancshares shareholders have adopted the Kentucky Bancshares merger proposal if the amendment or waiver would legally require further approval by the Kentucky Bancshares shareholders, as applicable, without first obtaining such further approval.
For more information, see “The Merger Agreement — Amendment, Waiver and Extension of the Merger Agreement” beginning on page 109.
Support Agreements
Each member of Kentucky Bancshares’ board of directors has entered into a support agreement with Stock Yards Bancorp pursuant to which they have agreed, among other things, and unless the merger agreement is terminated, to vote their respective shares of Kentucky Bancshares Common Stock in favor of the approval of the merger agreement and the transactions contemplated thereby, and against alternative acquisition proposals. As of the record date for the Kentucky Bancshares special meeting, the directors
 
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collectively owned and were entitled to vote approximately 411,684 shares of Kentucky Bancshares common stock, representing approximately 6.91% of the shares of Kentucky Bancshares common stock outstanding on that date. The form of support agreement is attached as Exhibit A to the merger agreement, a copy of which is attached as Annex A to this proxy statement/prospectus.
Material U.S. Federal Income Tax Consequences of the Merger
The merger and the upstream merger, taken together, are intended to qualify as a “reorganization” within the meaning of Section 368(a) of the Code, and it is a condition to the respective obligations of Stock Yards Bancorp and Kentucky Bancshares to complete the merger that each of Stock Yards Bancorp and Kentucky Bancshares receives a legal opinion to that effect. Accordingly, we expect the merger and the upstream merger, taken together, generally to be tax-free to Kentucky Bancshares common shareholders for United States federal income tax purposes with respect to the shares of Stock Yards Bancorp common stock that they receive pursuant to the merger. A Kentucky Bancshares common shareholder generally will recognize gain, but not loss, in an amount equal to the lesser of (1) the amount of gain realized (i.e., the excess of the sum of the amount of cash and the fair market value of the Stock Yards Bancorp common stock received pursuant to the merger over that holder’s adjusted tax basis in its shares of Kentucky Bancshares common stock surrendered) and (2) the amount of cash received pursuant to the merger. Further, a Kentucky Bancshares common shareholder generally will recognize gain or loss with respect to cash received instead of fractional shares of Stock Yards Bancorp common stock that the Kentucky Bancshares common shareholder would otherwise be entitled to receive. For further information, please refer to “Material U.S. Federal Income Tax Consequences of the Merger” beginning on page 111.
The United States federal income tax consequences described above may not apply to all holders of Kentucky Bancshares common stock. Your tax consequences will depend on your individual situation. Accordingly, we strongly urge you to consult your tax advisor for a full understanding of the particular tax consequences of the merger to you.
Accounting Treatment
The merger will be accounted by utilizing the acquisition accounting method in accordance with United States generally accepted accounting principles (“GAAP”).
The Rights of the Kentucky Bancshares Shareholders Will Change as a Result of the Merger
The rights of the Kentucky Bancshares shareholders are governed by Kentucky law and by the articles of incorporation and bylaws of Kentucky Bancshares. In the merger, the Kentucky Bancshares shareholders will become holders of common stock of Stock Yards Bancorp, and their rights will be governed by Kentucky law and the articles of incorporation and bylaws of Stock Yards Bancorp. The Kentucky Bancshares shareholders will have different rights once they become holders of common stock of Stock Yards Bancorp due to differences between the Kentucky Bancshares governing documents, on the one hand, and the Stock Yards Bancorp governing documents, on the other hand. These differences are described in more detail under the section of this proxy statement/prospectus entitled “Comparison of Shareholders’ Rights” beginning on page 116.
Listing of Stock Yards Bancorp Common Stock; Delisting and Deregistration of Kentucky Bancshares Common Stock
The shares of Stock Yards Bancorp common stock to be issued in the merger will be listed for trading on the NASDAQ. Following the merger, shares of Stock Yards Bancorp common stock will continue to be listed on the NASDAQ. In addition, following the merger, Kentucky Bancshares common stock will be delisted from NASDAQ and deregistered under the Exchange Act.
The Kentucky Bancshares Special Meeting
The Kentucky Bancshares special meeting will be held virtually on May 13, 2021, at 11:00 a.m., local time. At the Kentucky Bancshares special meeting, the Kentucky Bancshares shareholders will be asked to vote on the following matters:
 
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approve the Kentucky Bancshares merger proposal;

approve the Kentucky Bancshares compensation proposal; and

approve the Kentucky Bancshares adjournment proposal.
You may vote at the Kentucky Bancshares special meeting if you owned shares of Kentucky Bancshares common stock at the close of business on March 31, 2021. On that date, there were 5,961,004 shares of Kentucky Bancshares common stock outstanding, approximately 8.07% of which were owned and entitled to be voted by Kentucky Bancshares directors and executive officers and their affiliates. As described in the “Support Agreements” section above, each of the Kentucky Bancshares directors has entered into a support agreement with Stock Yards Bancorp pursuant to which he or she has agreed to vote in favor of the Kentucky Bancshares merger proposal, unless the merger agreement is terminated. We currently expect that Kentucky Bancshares’ executive officers, who are not also Kentucky Bancshares directors, will also vote their shares in favor of the Kentucky Bancshares merger proposal and the other proposals to be considered at the Kentucky Bancshares special meeting, although such executive officers have not entered into any agreements obligating them to do so.
Approval of the Kentucky Bancshares merger proposal requires the affirmative vote of a majority of the outstanding shares of Kentucky Bancshares common stock entitled to vote on the Kentucky Bancshares merger proposal, unless the merger agreement is terminated. Accordingly, an abstention, broker non-vote or other failure to vote will have the same effect as a vote “AGAINST” the Kentucky Bancshares merger proposal. Approval of each of the Kentucky Bancshares compensation proposal and the Kentucky Bancshares adjournment proposals requires the affirmative vote of a majority of the shares of Kentucky Bancshares common stock represented in person or by proxy at the Kentucky Bancshares special meeting. Accordingly, an abstention with respect to either the Kentucky Bancshares compensation proposal or the Kentucky Bancshares adjournment proposal will have the same effect as a vote “AGAINST” such proposal. A failure to vote or broker non-vote will have no effect on the outcome of either the Kentucky Bancshares compensation proposal or Kentucky Bancshares adjournment proposal.
Risk Factors
In evaluating the merger agreement and the merger, including the issuance of shares of Stock Yards Bancorp common stock in the merger, you should carefully read this proxy statement/prospectus and give special consideration to the factors discussed in the section of this proxy statement/prospectus entitled “Risk Factors” beginning on page 43 and in Stock Yards Bancorp’s and Kentucky Bancshares’ respective Annual Reports on Form 10-K for the year ended December 31, 2020 and in other documents incorporated by reference into this proxy statement/prospectus. Please see the section of this proxy statement/prospectus entitled “Where You Can Find More Information” beginning on page 126 of this proxy statement/prospectus for the location of information incorporated by reference into this proxy statement/prospectus.
 
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SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA OF STOCK YARDS BANCORP
The following table presents selected historical consolidated financial data of Stock Yards Bancorp. The selected historical consolidated financial data as of December 31, 2020 and 2019, and for the years ended December 31, 2020, 2019 and 2018, have been derived from Stock Yards Bancorp’s audited consolidated financial statements and accompanying notes contained in Stock Yards Bancorp’s Annual Report on Form 10-K for the year ended December 31, 2020, which is incorporated into this proxy statement/prospectus by reference. The selected historical consolidated financial data as of December 31, 2018, 2017 and 2016, and for the years ended December 31, 2017 and 2016, have been derived from Stock Yards Bancorp’s audited consolidated financial statements for such years and accompanying notes, which are not incorporated into this proxy statement/prospectus by reference.
You should read the following financial information relating to Stock Yards Bancorp in conjunction with other information contained in this proxy statement/prospectus, including the consolidated financial statements of Stock Yards Bancorp and related accompanying notes and the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” appearing in Stock Yards Bancorp’s Annual Report on Form 10-K most recently filed with the SEC. Stock Yards Bancorp’s historical results for any prior period are not necessarily indicative of results to be expected in any future period. The selected financial information in the table immediately below does not include, on any basis, the results or financial condition of Kentucky Bancshares for any period or as of any date. See the section of this proxy statement/prospectus entitled “Where You Can Find More Information” beginning on page 126 for a description of where you can find this other information.
 
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SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA OF STOCK YARDS BANCORP
As of and for the Years Ended December 31,
(in thousands, except per share data and number of
branches and employees)
2020
2019
2018
2017
2016
Operating Data:
Interest income
$ 147,871 $ 147,892 $ 129,932 $ 111,010 $ 102,421
Interest expense
11,950 22,544 15,357 7,246 4,918
Net interest income
135,921 125,348 114,575 103,764 97,503
Provision for credit losses
16,918 1,000 2,705 2,550 3,000
Net interest income after provision for credit
losses
119,003 124,348 111,870 101,214 94,503
Non-interest income
51,899 49,428 45,066 44,042 42,801
Non-interest expenses
103,159 98,116 89,388 90,074 81,033
Income before income tax expense
67,743 75,660 67,548 55,182 56,271
Income tax expense
8,874 9,593 12,031 17,139 15,244
Net income
$ 58,869 $ 66,067 $ 55,517 $ 38,043 $ 41,027
Share and Per Share Data:
Weighted average shares outstanding – Basic 
22,563 22,598 22,619 22,532 22,356
Weighted average shares outstanding – Diluted
22,768 22,865 22,944 22,983 22,792
Total shares outstanding
22,692 22,604 22,749 22,679 22,617
Net income per share – Basic
$ 2.61 $ 2.92 $ 2.45 $ 1.69 $ 1.84
Net income per share – Diluted
2.59 2.89 2.42 1.66 1.80
Cash dividends declared per share
1.08 1.04 0.96 0.80 0.72
Dividend payout ratio(1)
41% 36% 39% 47% 39%
Financial Condition Data:
Total assets
$ 4,608,629 $ 3,724,197 $ 3,302,924 $ 3,239,646 $ 3,039,481
Total loans held for investment
3,531,596 2,845,016 2,548,171 2,409,570 2,305,375
Total deposits
3,988,634 3,133,938 2,794,356 2,578,295 2,520,548
Stockholders’ equity
440,701 406,297 366,500 333,644 313,872
Book value per share
$ 19.42 $ 17.97 $ 16.11 $ 14.71 $ 13.88
Performance Ratios:
Return on average assets
1.40% 1.90% 1.76% 1.25% 1.42%
Return on average stockholders’ equity
14.01 17.09 16.00 11.61 13.49
Average stockholders’ equity to average assets
9.96 11.10 10.98 10.79 10.54
Net interest rate spread(2)
3.22 3.50 3.60 3.53 3.52
Net interest rate margin (FTE)(3)
3.39 3.82 3.83 3.64 3.60
Efficiency ratio (FTE)(4)
54.86 56.07 55.89 60.52 57.41
Wealth Management & Trust Assets:
Market value of assets under management
$ 3,851,637 $ 3,319,812 $ 2,764,875 $ 2,809,499 $ 2,523,411
Asset Quality:
Non-performing loans
$ 13,179 $ 12,063 $ 3,398 $ 7,382 $ 6,707
 
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As of and for the Years Ended December 31,
(in thousands, except per share data and number of
branches and employees)
2020
2019
2018
2017
2016
Non-performing loans to total loans
0.37% 0.42% 0.13% 0.31% 0.29%
Net charge offs/(recoveries) to average
loans
0.05 (0.01) 0.08 0.07 0.07
Allowance for credit losses to total loans(8)
1.47 0.94 1.00 1.03 1.04
Capital Ratios:
Total risk-based capital
13.36% 12.85% 13.91% 13.52% 13.04%
Common equity tier 1 risk-based capital
12.23 12.02 13.00 12.57 12.10
Tier 1 risk based capital
12.23 12.02 13.00 12.57 12.10
Leverage
9.57 10.60 11.33 10.70 10.54
Non-regulatory Capital:
Tangible common equity per share(5)(7)
$ 18.78 $ 17.32 $ 16.03 $ 14.63 $ 13.79
Tangible common equity to tangible
assets (6)(7)
9.28% 10.55% 11.05% 10.25% 10.26%
Other Data:
Number of branches
44 42 38 37 37
Full time equivalent employees
641 615 591 580 578
   
Share and per share information has been adjusted to reflect the 3 for 2 stock-split in April 2016 effected in the form of a 50% stock dividend.
(1)
Dividend payout ratio represents per share dividends declared divided by basic earnings per share.
(2)
Net interest spread represents the difference between the fully taxable equivalent (FTE) weighted average yield earned on interest earning assets and the weighted average cost of interest bearing liabilities for the period.
(3)
Net interest margin represents FTE net interest income as a percentage of average interest earning assets for the period.
(4)
The efficiency ratio, a non-GAAP measure, equals total non-interest expenses divided by the sum of FTE net interest income and non-interest income. The ratio excludes net gains (losses) on sales, calls, and impairment of investment securities, if applicable. See the following table titled “Reconciliation of Non-GAAP Financial Measures.”
(5)
Tangible common equity (total common equity less goodwill and core deposit intangible asset) divided by total shares outstanding.
(6)
Tangible equity (total equity less goodwill and core deposit intangible asset) divided by tangible assets (total assets less goodwill and core deposit intangible asset).
(7)
Tangible equity, tangible common equity, and tangible assets are non-GAAP financial measures. Additionally, any ratios utilizing these financial measures are also non-GAAP. These financial measures have been included as they are considered to be critical metrics with which to analyze and evaluate financial condition and capital strength. Other companies may calculate these financial measures differently. See the following table titled “Reconciliation of Non-GAAP Financial Measures.”
(8)
Effective January 1, 2020, Stock Yards Bancorp adopted ASU 2016-13, “Financial Instruments — Credit Losses” ​(Topic 326). The historical information disclosed is in accordance with ASC Topic 310.
 
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Reconciliation of Non-GAAP Financial Measures
The following information reconciles: (i) Stock Yards Bancorp’s ratio of tangible common equity to tangible assets, a non-GAAP financial measure, as of the dates presented, and (ii) Stock Yards Bancorp’s ratio of tangible common equity per share, a non-GAAP financial measure, as of the dates presented:
December 31, (in thousands, except per share data)
2020
2019
2018
2017
2016
Total stockholders’ equity – GAAP (a)
$ 440,701 $ 406,297 $ 366,500 $ 333,644 $ 313,872
Less: Goodwill
(12,513) (12,513) (682) (682) (682)
Less: Core deposit intangible
(1,962) (2,285) (1,057) (1,225) (1,405)
Tangible common equity – Non-GAAP (c)
$ 426,226 $ 391,499 $ 364,761 $ 331,737 $ 311,785
Total assets – GAAP (b)
$ 4,608,629 $ 3,724,197 $ 3,302,924 $ 3,239,646 $ 3,039,481
Less: Goodwill
(12,513) (12,513) (682) (682) (682)
Less: Core deposit intangible
(1,962) (2,285) (1,057) (1,225) (1,405)
Tangible assets – Non-GAAP (d)
$ 4,594,154 $ 3,709,399 $ 3,301,185 $ 3,237,739 $ 3,037,394
Total stockholders’ equity to total assets – GAAP (a/b)
9.56% 10.91% 11.10% 10.30% 10.33%
Tangible common equity to tangible assets – Non-GAAP (c/d)
9.28% 10.55% 11.05% 10.25% 10.26%
Total shares outstanding (e)
22,692 22,604 22,749 22,679 22,617
Book value per share – GAAP (a/e)
$ 19.42 $ 17.97 $ 16.11 $ 14.71 $ 13.88
Tangible common equity per share – Non-GAAP (c/e)
18.78 17.32 16.03 14.63 13.79
The efficiency ratio, a non-GAAP measure, equals total non-interest expenses divided by the sum of net interest income FTE and non-interest income. The ratio excludes net gains/losses on sales, calls, and impairment of investment securities, if applicable. In addition to the efficiency ratio, Stock Yards Bancorp considers an adjusted efficiency ratio. Stock Yards Bancorp believes it is important because it provides a comparable ratio after eliminating the fluctuation in non-interest expenses related to amortization of investments in tax credit partnerships.
Years ended December 31, (dollars in thousands)
2020
2019
2018
2017
2016
Total non-interest expenses (a)
$ 103,159 $ 98,116 $ 89,388 $ 90,074 $ 81,033
Less: Amortization of investments in tax credit partnerships
(3,096) (1,078) (1,237) (7,124) (4,458)
Total non-interest expenses – Adjusted (c)
$ 100,063 $ 97,038 $ 88,151 $ 82,950 $ 76,575
Total net interest income, FTE
$ 136,133 $ 125,571 $ 114,882 $ 104,557 $ 98,337
Total non-interest income
51,899 49,428 45,066 44,042 42,801
Less: Gain/loss on sale of securities
232
Total revenue (b)
$ 188,032 $ 174,999 $ 159,948 $ 148,831 $ 141,138
Efficiency ratio (a/b)
54.86% 56.07% 55.89% 60.52% 57.41%
Efficiency ratio – Adjusted (c/b)
53.22% 55.45% 55.11% 55.73% 54.26%
 
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SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA OF KENTUCKY BANCSHARES
The following table presents selected historical consolidated financial data of Kentucky Bancshares. The selected historical consolidated financial data as of December 31, 2020 and 2019, and for the years then ended, have been derived from Kentucky Bancshares’ audited consolidated financial statements and accompanying notes contained in Kentucky Bancshares’ Annual Report on Form 10-K for the year ended December 31, 2020, which is incorporated into this proxy statement/prospectus by reference. The selected historical consolidated financial data as of December 31, 2018, 2017 and 2016, and for the years then ended, have been derived from Kentucky Bancshares’ audited consolidated financial statements for such years and accompanying notes, which are not incorporated into this proxy statement/prospectus by reference.
You should read the following financial information relating to Kentucky Bancshares in conjunction with other information contained in this proxy statement/prospectus, including the consolidated financial statements of Kentucky Bancshares and related accompanying notes and the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” appearing in Kentucky Bancshares’ Annual Report on Form 10-K most recently filed with the SEC. Kentucky Bancshares’ historical results for any prior period are not necessarily indicative of results to be expected in any future period. The selected financial information in the table immediately below does not include, on any basis, the results or financial condition of Stock Yards Bancorp for any period or as of any date. See the section of this proxy statement/prospectus entitled “Where You Can Find More Information” beginning on page 126 for a description of where you can find this other information.
 
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SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA OF KENTUCKY BANCSHARES
(in thousands, except per share data and number
of branches and employees)
As of and for the Years Ended December 31,
2020
2019
2018
2017
2016
Operating Data:
Interest income
$ 42,685 $ 45,532 $ 42,632 $ 38,659 $ 36,554
Interest expense
6,703 8,983 6,802 5,014 4,426
Net interest income
35,982 36,549 35,830 33,645 32,128
Provision for loan losses
1,775 1,250 500 500 1,150
Net interest income after provision for loan losses
34,207 35,299 35,330 33,145 30,978
Non-interest income
15,975 14,239 12,963 13,808 12,149
Non-interest expenses
37,607 35,308 34,209 33,073 33,785
Income before income tax expense
12,575 14,230 14,084 13,880 9,342
Income tax expense
878 1,077 1,654 3,163 773
Net income
$ 11,697 $ 13,153 $ 12,430 $ 10,717 $ 8,569
Share and Per Share Data:
Weighted average shares outstanding – Basic
5,942 5,953 5,924 5,944 5,982
Weighted average shares outstanding – Diluted
5,942 5,953 5,924 5,944 5,982
Total shares outstanding
5,946 5,914 5,955 5,943 5,946
Net income per share – Basic
$ 1.97 $ 2.21 $ 2.09 $ 1.81 $ 1.43
Net income per share – Diluted
1.97 2.21 2.09 1.81 1.43
Cash dividends declared per share
0.720 0.680 0.625 0.580 0.540
Dividend payout ratio(1)
37% 31% 30% 32% 38%
Financial Condition Data:
Total assets
$ 1,239,505 $ 1,110,790 $ 1,086,012 $ 1,053,193 $ 1,028,447
Total loans held for investment, net
756,974 735,853 678,017 640,815 648,466
Total deposits
978,604 842,653 850,442 815,273 802,981
Stockholders’ equity
128,342 119,263 106,793 100,329 92,972
Book value per share
$ 21.58 $ 20.17 $ 17.93 $ 16.88 $ 15.64
Performance Ratios:
Return on average assets
0.97% 1.20% 1.18% 1.04% 0.86%
Return on average stockholders’ equity
9.54 11.52 12.36 10.93 9.10
Average stockholders’ equity to average
assets
10.20 10.43 9.56 9.48 9.41
Net interest rate spread(2)
3.03 3.28 3.43 3.41 3.44
Net interest rate margin (FTE)(3)
3.29 3.64 3.70 3.60 3.61
Efficiency ratio (FTE)(4)
71.92 69.88 68.91 67.19 73.03
Wealth Management & Trust Assets:
Market value of assets under management
$ 258,200 $ 249,009 $ 218,193 $ 209,735 $ 236,215
Asset Quality:
Non-performing loans
$ 5,271 $ 4,580 $ 2,323 $ 1,424 $ 7,556
 
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(in thousands, except per share data and number
of branches and employees)
As of and for the Years Ended December 31,
2020
2019
2018
2017
2016
Non-performing loans to total loans
0.70% 0.61% 0.34% 0.22% 1.15%
Net charge offs/(recoveries) to average loans
0.04 0.13 0.01 0.05 0.02
Allowance for credit losses to total loans(8)
1.29 1.14 1.18 1.19 1.15
Capital Ratios – Bank:(9)
Tier 1 capital (to average assets)
9.0% 9.3% 9.2% 9.0% 8.7%
Non- Regulatory Capital:
Tangible common equity per share(5)(7)
$ 19.22 $ 17.78 $ 15.54 $ 14.46 $ 13.20
Tangible common equity to tangible assets(6)(7)
9.33% 9.59% 8.64% 8.27% 7.74%
Other Data:
Number of branches
19 18 17 17 17
Full time equivalent employees
236 233 232 233 241
(1)
Dividend payout ratio represents per share dividends declared divided by basic earnings per share.
(2)
Net interest spread represents the difference between the fully taxable equivalent (FTE) weighted average yield earned on interest earning assets and the weighted average cost of interest bearing liabilities for the period.
(3)
Net interest margin represents FTE net interest income as a percentage of average interest earning assets for the period.
(4)
The efficiency ratio, a non-GAAP measure, equals total non-interest expenses divided by the sum of FTE net interest income and non-interest income. The ratio excludes net gains (losses) on sales, calls, and impairment of investment securities, if applicable. See the following table titled “Reconciliation of Non-GAAP Financial Measures.”
(5)
Tangible common equity (total common equity less goodwill and core deposit intangible asset) divided by total shares outstanding.
(6)
Tangible equity (total equity less goodwill and core deposit intangible asset) divided by tangible assets (total assets less goodwill and core deposit intangible asset).
(7)
Tangible equity, tangible common equity, and tangible assets are non-GAAP financial measures. Additionally, any ratios utilizing these financial measures are also non-GAAP. These financial measures have been included as they are considered to be critical metrics with which to analyze and evaluate financial condition and capital strength. Other companies may calculate these financial measures differently. See the following table titled “Reconciliation of Non-GAAP Financial Measures.”
(8)
Kentucky Bancshares was not required to and did not adopt ASU 2016-13 “Financial Instruments — Credit Losses” ​(Topic 326) effective January 1, 2020. All information disclosed is in accordance with ASC Topic 310.
(9)
Kentucky Bancshares adopted the Community Bank Leverage Ratio framework as permitted by the FDIC effective January 1, 2020.
 
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Reconciliation of Non-GAAP Financial Measures
The following information reconciles: (i) Kentucky Bancshares ratio of tangible common equity to tangible assets, a non-GAAP financial measure, as of the dates presented, and (ii) Kentucky Bancshares’ ratio of tangible common equity per share, a non-GAAP financial measure, as of the dates presented:
December 31, (in thousands, except per share data)
2020
2019
2018
2017
2016
Total stockholders’ equity – GAAP (a)
$ 128,342 $ 119,263 $ 106,793 $ 100,329 $ 92,972
Less: Goodwill
(14,001) (14,001) (14,001) (14,001) (14,001)
Less: Core deposit intangible
(62) (136) (238) (369) (529)
Tangible common equity – Non-
GAAP (c)
$ 114,279 $ 105,126 $ 92,554 $ 85,959 $ 78,442
Total assets – GAAP (b)
$ 1,239,505 $ 1,110,790 $ 1,086,012 $ 1,053,193 $ 1,028,447
Less: Goodwill
(14,001) (14,001) (14,001) (14,001) (14,001)
Less: Core deposit intangible
(62) (136) (238) (369) (529)
Tangible assets – Non-GAAP (d)
$ 1,225,442 $ 1,096,653 $ 1,071,773 $ 1,038,823 $ 1,013,917
Total stockholders’ equity to total assets – GAAP (a/b)
10.35% 10.74% 9.83% 9.53% 9.04%
Tangible common equity to tangible assets – Non-GAAP (c/d)
9.33% 9.59% 8.64% 8.27% 7.74%
Total shares outstanding (e)
5,946 5,914 5,955 5,943 5,943
Book value per share – GAAP (a/e)
$ 21.58 $ 20.17 $ 17.93 $ 16.88 $ 15.64
Tangible common equity per share – Non-GAAP (c/e)
19.22 17.78 15.54 14.46 13.20
The efficiency ratio, a non-GAAP measure, equals total non-interest expenses divided by the sum of net interest income FTE and non-interest income. The ratio excludes net gains /losses on sales, calls, and impairment of investment securities.
Years ended December 31, (dollars in thousands)
2020
2019
2018
2017
2016
Total non-interest expenses (a)
$ 37,607 $ 35,308 $ 34,209 $ 33,073 $ 33,785
Total net interest income, FTE
$ 36,659 $ 37,144 $ 36,617 $ 35,424 $ 34,019
Total non-interest income
15,975 14,239 12,963 13,808 12,149
Less: Gain/loss on sale of securities
(345) (857) 65 (6) 92
Total revenue (b)
$ 52,289 $ 50,526 $ 49,645 $ 49,226 $ 46,260
Efficiency ratio (a/b)
71.92% 69.88% 68.91% 67.19% 73.03%
 
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UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION
The following unaudited pro forma condensed combined financial information combines the historical consolidated financial position and results of operations of Stock Yards Bancorp and Kentucky Bancshares as an acquisition by Stock Yards Bancorp of Kentucky Bancshares. The merger was announced on January 27, 2021, and provides that each share of Kentucky Bancshares common stock issued and outstanding immediately before the effective time of the merger (other than the Excluded Shares and the Dissenting Shares) will be automatically converted into the right to receive 0.64 shares of Stock Yards Bancorp common stock and $4.75 in cash.
The unaudited pro forma condensed combined financial information has been prepared to give effect to the following:

The acquisition of Kentucky Bancshares by Stock Yards Bancorp under the provision of the Financial Accounting Standards Board (FASB) Accounting Standards Codification, ASC 805, “Business Combinations” where the assets and liabilities of Kentucky Bancshares will be recorded by Stock Yards Bancorp at their respective fair values as of the date the merger is completed;

The distribution of shares of Stock Yards Bancorp common stock to Kentucky Bancshares’ shareholders in exchange for shares of Kentucky Bancshares common stock (based upon a 0.64 exchange ratio and payment of the cash portion of the aggregate merger consideration) and $4.75 in cash;

Certain reclassifications to conform historical financial statement presentation of Kentucky Bancshares to Stock Yards Bancorp; and

Transaction costs in connection with the merger.
The following unaudited pro forma condensed combined financial information and related notes are based on and should be read in conjunction with the historical audited consolidated financial statements of Stock Yards Bancorp and Kentucky Bancshares and the related notes included in the respective Stock Yards Bancorp’s and Kentucky Bancshares’ Annual Reports on Form 10-K for the year ended December 31, 2020, which are incorporated by reference herein.
The unaudited pro forma condensed combined income statements for the year ended December 31, 2020 combine the historical consolidated income statements of Stock Yards Bancorp and Kentucky Bancshares, giving effect to the merger as if it had been completed on January 1, 2020. The unaudited pro forma condensed combined statement of financial condition as of December 31, 2020 combines the historical consolidated statements of financial condition of Stock Yards Bancorp and Kentucky Bancshares, giving effect to the merger as if it had been completed on December 31, 2020. This pro forma information is subject to risks and uncertainties, including those discussed in the section of this proxy statement/prospectus entitled “Risk Factors” beginning on page 43.
The unaudited pro forma condensed combined financial information is provided for illustrative information purposes only. The unaudited pro forma condensed combined financial information is not necessarily, and should not be assumed to be, an indication of the actual results that would have been achieved had the merger been completed as of the dates indicated or that may be achieved in the future. The pro forma financial information has been prepared by Stock Yards Bancorp in accordance with Regulation S-X Article 11, Pro Forma Financial Information, as amended by the final rule, Amendments to Financial Disclosures About Acquired and Disposed Businesses, as adopted by the SEC on May 21, 2020.
The unaudited pro forma condensed combined financial information also does not consider any potential benefits to be obtained by the resulting company from additional revenue opportunities or cost savings. In addition, as explained in more detail in the accompanying notes, the preliminary allocation of the pro forma purchase price reflected in the unaudited pro forma condensed combined financial information is subject to adjustment and may vary significantly from the actual purchase price allocation that will be recorded upon completion of the merger.
As of the date of this proxy statement/prospectus, Stock Yards Bancorp has not completed the valuation analysis and calculations in sufficient detail necessary to arrive at the required estimates of the
 
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fair value of the Kentucky Bancshares assets to be acquired or liabilities to be assumed, other than a preliminary estimate for intangible assets and certain financial assets and financial liabilities. Accordingly, apart from the aforementioned, certain Kentucky Bancshares assets and liabilities are presented at their respective carrying amounts and should be treated as preliminary values. A final determination of the fair value of Kentucky Bancshares’ assets and liabilities will be based on Kentucky Bancshares’ actual assets and liabilities as of the closing date and, therefore, cannot be made before the completion of the merger. In addition, the value of the merger consideration to be paid by Stock Yards Bancorp in shares of Stock Yards Bancorp common stock upon the completion of the merger will be determined based on the closing price of Stock Yards Bancorp common stock on the closing date and the number of issued and outstanding shares of Kentucky Bancshares common stock immediately before the closing. Actual adjustments may differ from the amounts reflected in the unaudited pro forma condensed combined financial information, and the differences may be material.
FASB issued ASU 2016-13 “Financial Instruments —  Credit Losses” ​(Topic 326), which requires that the measurement of all expected credit losses for financial assets reported at amortized cost and held at the reporting date be based on historical experience, current conditions, and reasonable and supportable forecasts. This standard requires financial institutions and other organizations to use forward-looking information to better inform their credit loss estimates. ASU 2016-13 (CECL) was effective for Stock Yards Bancorp as of January 1, 2020, however it was not effective for Kentucky Bancshares. Under Section 4014 of the CARES Act, financial institutions that were required to adopt ASU 2016-13 as of January 1, 2020 were provided statutory relief in terms of an option to delay the adoption of the CECL framework until the earlier of the end of the national emergency declaration related to the COVID-19 crisis or December 31, 2022. On January 1, 2020, Stock Yards Bancorp adopted the CECL framework. Subsequent to its adoption of CECL, Stock Yards no longer maintains the incurred loss model framework. In accordance with ASU 2016-13, Kentucky Bancshares is not required to adopt the CECL framework until January 1, 2023, since they are a smaller reporting company under SEC guidance. The pro forma balance sheet reflects an adjustment to estimate the impact of the application of ASU 2016-13 to the combined allowance for loan/credit losses as of December 31, 2020. The pro forma income statement reflects an adjustment as of January 1, 2020 to estimate the impact of the application of ASU 2016-13 to the combined provision for credit/loan losses.
Further, in addition to ASU 2016-13 noted above, Stock Yards Bancorp has not identified all adjustments necessary to conform Kentucky Bancshares’ accounting policies to Stock Yards Bancorp’s accounting policies. Upon completion of the merger, or as more information becomes available, Stock Yards Bancorp will perform a more detailed review of Kentucky Bancshares’ accounting policies. As a result of that review, differences could be identified between the accounting policies of the two companies that, when conformed, could have a material impact on the combined company’s financial information.
As a result of the foregoing, the pro forma adjustments are preliminary and are subject to change as additional information becomes available and as additional analysis is performed. The preliminary pro forma adjustments have been made solely for the purpose of providing the unaudited pro forma condensed combined financial information. Stock Yards Bancorp estimated the fair value of certain Kentucky Bancshares’ assets and liabilities based on a preliminary valuation analysis, due diligence information, information presented in Kentucky Bancshares’ SEC filings and other publicly available information. Until the merger is completed, both companies are limited in their ability to share certain information.
Upon completion of the merger, a final determination of the fair value of Kentucky Bancshares’ assets acquired and liabilities assumed will be performed. Any changes in the fair values of the net assets or total purchase consideration as compared with the information shown in the unaudited pro forma condensed combined financial information may change the amount of the total purchase consideration allocated to goodwill and other assets and liabilities and may impact the combined company’s statement of income. The final purchase consideration allocation may be materially different than the preliminary purchase consideration allocation presented in the unaudited pro forma condensed combined financial information.
 
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UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF FINANCIAL CONDITION
As of December 31, 2020
(in thousands)
Stock Yards
(as reported)
Kentucky Bancshares
(as reported)
Merger
Adjustments
Stock Yards
(pro forma)
Assets:
Cash and cash equivalents
$ 317,945 $ 41,444 $ (28,317) a $ 331,072
Available for sale debt securities
586,978 353,494 940,472
Federal Home Loan Bank stock, at cost
11,284 7,072 18,356
Mortgage loans held for sale
22,547 4,427 26,974
Loans
3,531,596 766,871 954 b 4,299,421
Allowance for credit/loan losses
(51,920) c (9,897) d (5,919) e (67,736)
Net loans
3,479,676 756,974 (4,965) 4,231,685
Premises and equipment, net
45,915 20,375 (2,850) f 63,440
Operating lease right of use asset
12,100 7,670 19,770
Bank owned life insurance
33,250 18,713 51,963
Accrued interest receivable
13,094 5,227 18,321
Core deposit intangible
1,962 62 3,938 g 5,962
Mortgage servicing rights
2,710 1,612 420 h 4,742
Other real estate owned
281 876 (125) i 1,032
Goodwill
12,513 14,001 118,475 j 144,989
Deferred income taxes, net
22,320 293 1,888 k 24,501
Other assets
46,054 7,265 (1,548) l 51,771
Total assets
$ 4,608,629 $ 1,239,505 $ 86,916 $ 5,935,050
Liabilities:
Deposits:
Non-interest bearing demand
$ 1,187,057 $ 313,285 $ $ 1,500,342
Interest bearing demand
1,355,985 273,803 1,629,788
Money market
844,414 87,283 931,697
Savings
208,774 133,842 342,616
Time
392,404 170,391 671 m 563,466
Total deposits
3,988,634 978,604 671 4,967,909
Securities sold under agreements to repurchase
47,979 9,129 57,108
Federal funds purchased
11,464 11,464
Federal Home Loan Bank advances
31,639 96,532 2,300 n 130,471
Subordinated note
7,217 7,217
Accrued interest payable
391 775 1,166
Operating lease liabilities
13,476 7,850 21,326
Other liabilities
74,345 11,056 20,976 o 106,377
Total liabilities
4,167,928 1,111,163 23,947 5,303,038
Stockholders’ Equity:
Common stock
36,500 21,996 (9,292) p 49,204
Additional paid-in capital
41,886 196,625 q 238,511
Retained Earnings
353,574 104,319 (122,337) r 335,556
Accumulated other comprehensive income 
8,741 2,027 (2,027) s 8,741
Total stockholders’ equity
440,701 128,342 62,969 632,012
Total liabilities and stockholders’ equity
$ 4,608,629 $ 1,239,505 86,916 $ 5,935,050
See accompanying Notes to the Unaudited Pro Forma Condensed Combined Financial Information
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UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENT OF INCOME
For the Year Ended December 31, 2020
(in thousands, except per share data)
Stock Yards
(as reported)
Kentucky
Bancshares
(as reported)
Merger
Adjustments
Stock Yards
(pro forma)
Interest income:
Loans, including fees
$ 137,699 $ 36,456 $ (387) a $ 173,768
Federal funds sold and interest bearing due from banks
738 150 888
Mortgage loans held for sale
533 533
Federal Home Loan Bank stock
253 159 412
Securities available for sale
Taxable
8,432 4,976 13,408
Tax-exempt
216 944 1,160
Total interest income
147,871 42,685 (387) 190,169
Interest expense:
Deposits
10,478 4,319 (671) b 14,126
Securities sold under agreements to repurchase
37 24 61
Federal funds purchased and other short-term borrowings
35 1 36
Federal Home Loan Bank advances
1,400 2,091 (1,257) c 2,234
Subordinated debentures
268 268
Total interest expense
11,950 6,703 (1,928) 16,725
Net interest income
135,921 35,982 1,541 173,444
Provision for credit losses under CECL framework
16,918 d 5,190 e 22,108
Provision for loan losses under incurred loss framework
1,775 d 1,775
Net interest income after provision
119,003 34,207 (3,649) 149,561
Non-interest income:
Wealth management and trust services
23,406 1,441 24,847
Deposit service charges
4,161 2,811 6,972
Debit and credit card income
8,480 4,054