<PAGE>
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement
[X] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a- 12
PEOPLES FIRST CORPORATION
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(Name of Registrant as Specified in Its Charter)
PEOPLES FIRST CORPORATION
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(Name of Person(s) Filing Proxy Statement)
Payment of filing fee (Check the appropriate box):
[X] $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(j)(2).
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rule 14a-6(i)(4)
and 0-11.
(1) Title of each class of securities to which transactions applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price of other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11:(1)
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(4) Proposed maximum aggregate value of transaction:
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[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the form or schedule and the date of its filing.
(1) Amount previously paid:
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(2) Form, schedule or registration statement no.:
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(3) Filing party:
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(4) Date filed:
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(1)Set forth the amount on which the filing fee is calculated and state how
it was determined.
<PAGE>
[PEOPLES FIRST CORPORATION LETTERHEAD]
March 20, 1995
Dear Shareholder:
We are enclosing Peoples First Corporation's 1995 Annual Report, Notice of
the 1996 Annual Meeting of Shareholders, proxy statement, and proxy form. For
shareholders participating in the Corporation's Share Owner Dividend
Reinvestment and Stock Purchase Plan, the enclosed proxy form will also
represent shares held in the dividend reinvestment plan.
PLEASE NOTE THAT THE CORPORATION'S 1996 ANNUAL MEETING WILL BE HELD AT 4:00
P.M., ON THURSDAY, MAY 2, 1996, AT THE EXECUTIVE INN, INTERNATIONAL ROOMS A AND
B, ONE EXECUTIVE BOULEVARD, PADUCAH, KENTUCKY.
Even if you are planning to attend the Annual Meeting in person, we would
appreciate your signing the enclosed proxy form and returning it in the enclosed
self-addressed envelope to our proxy tabulating agent, Boatmen's Trust Company.
You may revoke the proxy form at the meeting should you desire to vote your
shares in person.
Very truly yours,
/s/ Aubrey W. Lippert
Aubrey W. Lippert
Chairman of the Board and President
<PAGE>
PEOPLES FIRST CORPORATION
100 South 4th Street
Post Office Box 2200
Paducah, Kentucky 42002-2200
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 2, 1996
The Annual Meeting of Shareholders of Peoples First Corporation (the
"Corporation") will be held at 4:00 p.m. (local time) on Thursday, May 2, 1996,
at the Executive Inn, International Rooms A and B, One Executive Boulevard,
Paducah, Kentucky. The Annual Meeting will be held for the following purposes:
1. ELECTION OF DIRECTORS. To elect seven directors.
2. RATIFICATION OF APPOINTMENTS TO AUDIT COMMITTEE. To act upon a
proposal to ratify the appointment of directors to the Audit Committee
of the Corporation's Board of Directors.
3. OTHER BUSINESS. To act upon such other matters as may properly be
brought before the Annual Meeting or any adjournment thereof.
Information regarding the matters to be acted upon at the Annual Meeting is
contained in the Proxy Statement accompanying this Notice.
Only those holders of record of the Corporation's common stock at the close
of business on March 22, 1996, are entitled to notice of and to vote at the
Annual Meeting and any adjournment thereof.
BY ORDER OF THE BOARD OF DIRECTORS
/s/A. Howard Arant
A. Howard Arant
Secretary
Paducah, Kentucky
March 25, 1996
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YOUR VOTE IS IMPORTANT
PLEASE DATE, SIGN, AND PROMPTLY RETURN THE ENCLOSED
PROXY IN THE ACCOMPANYING POSTAGE PAID ENVELOPE.
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<PAGE>
PEOPLES FIRST CORPORATION
100 South 4th Street
Post Office Box 2200
Paducah, Kentucky 42002-2200
PROXY STATEMENT FOR ANNUAL MEETING
OF SHAREHOLDERS TO BE HELD MAY 2, 1996
The Board of Directors of Peoples First Corporation (the "Corporation")
is soliciting the accompanying proxy form for use at the 1996 Annual
Meeting of Shareholders to be held at 4:00 p.m. (local time), on Thursday,
May 2, 1996, at the Executive Inn, International Rooms A and B, One
Executive Boulevard, Paducah, Kentucky.
Only holders of record of the Corporation's common stock (the "Common
Stock") at the close of business on March 22, 1996 (the "Record Date"), are
entitled to notice of and to vote at the Annual Meeting. On March 22,
1996, there were 9,243,808 shares of Common Stock issued, outstanding, and
entitled to vote at the Annual Meeting.
Each holder of Common Stock has one vote per share in all matters coming
before the Annual Meeting, except for the election of directors. In the
election of directors, each shareholder is entitled to vote the number of
shares held on the Record Date multiplied by the number of directors to be
elected, and may cast all of those votes for a single nominee or may
distribute the votes among as many nominees as desired. The Board of
Directors is soliciting authority for the proxies to vote shares in this
fashion at their discretion. Proxy forms may be revoked at any time before
the taking of the vote at the 1996 Annual Meeting by delivering written
notice of revocation to the Corporation's Secretary.
Share amounts and per share information in this Proxy Statement have
been adjusted to reflect 5% stock dividends declared by the Corporation on
April 28, 1995 and January 17, 1996.
This Proxy Statement and the accompanying proxy form are first being
sent or given to shareholders on or about March 25, 1996.
PRINCIPAL SHAREHOLDERS
The following table sets forth, as of March 22, 1996, certain
information with respect to each person known to the Corporation to
beneficially own five percent or more of the outstanding Common Stock, as
well as the aggregate number of shares of Common Stock beneficially owned
by all of the directors and officers of the Corporation and executive
officers of the Corporation's affiliate banks (the "Banks") as a group.
<PAGE>
<TABLE>
<CAPTION>
Number of Shares
and Nature of Percentage
Name and Address Beneficial Ownership of Class
---------------- -------------------- ----------
<S> <C> <C>
Peoples First National 1,197,212(1) 13.0%
Bank and Trust Company ("PFNB")
100 S. 4th Street
P. O. Box 1920
Paducah, Kentucky 42001
All Directors and Officers
of the Corporation and Executive
Officers of the Banks as a
Group (26 persons) 1,209,771(2) 12.7%(3)
</TABLE>
-------------------------------
(1) Includes 890,071 shares PFNB holds in a fiduciary capacity, as
trustee, executor or otherwise, including 745,830 shares held with
sole voting and dispositive power, and 144,241 shares held with
shared voting and dispositive power. In addition, PFNB holds
307,141 shares as Trustee for the Corporation's Employee Stock
Ownership Plan (the "ESOP"), with respect to which PFNB has sole
dispositive power. PFNB must vote 307,141 shares as specifically
directed by each ESOP member with respect to the shares allocated
to that member's account.
(2) The number of shares owned by individual directors and executive
officers of the Corporation and the nature of their beneficial
ownership are set forth in the table under "ELECTION OF DIRECTORS."
Other officers of the Corporation and executive officers of the
Banks beneficially own 92,389 shares.
(3) Shares of Common Stock subject to options that are or will become
exercisable within 60 days have been deemed outstanding for
computing the percentage of class of the group, whose members hold
the options, but are not deemed outstanding for computing the
percentage of class of any other person.
ELECTION OF DIRECTORS
The Corporation's Board of Directors consists of 19 members in
three classes. Directors are elected to three-year terms, and ordinarily
one class of directors is elected at each annual meeting of shareholders.
The Corporation will elect seven directors at the 1996 Annual
Meeting. James T. Holloway, Allan B. Kleet, R. E. Pugh, Neal Ramage, Mary
Warren Sanders and Victor F. Speck have been nominated for election as
directors for terms expiring at the 1999 Annual Meeting. Glen Berryman has
been nominated for election as a director for a term expiring at the 1998
Annual Meeting. Mr. Berryman will fill the vacancy created by the
resignation of Gathiel Baker from the Board effective May 2, 1996 due to
his attaining the retirement age of 70. The Board of Directors wishes to
express its appreciation to Mr. Baker for his service as a director of the
Corporation and First Kentucky Federal Savings Bank.
The Corporation's Articles of Incorporation provide that the number
of its directors will be fixed from time to time by the Board of Directors.
Between meetings of shareholders held for the election of directors, the
Board of Directors may increase or decrease the number of directors last
approved by the shareholders by thirty percent (30%) or less. Any vacant
directorship, whether resulting from an increase in the number of directors
or otherwise, may be filled by the affirmative vote of the majority of the
Directors then in office, whether or not a quorum of the Board of Directors
exists at the time of the vote, for a term of office continuing only until
the next election of directors by the shareholders. A decrease
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<PAGE>
in the number of directors, however, will not have the effect of shortening
the term of any incumbent director.
If any named nominee should refuse or be unable to serve, the Board
of Directors believes the persons designated as proxies will vote the
shares represented by the enclosed proxy form for the substitute nominee,
if any, proposed by the Board of Directors. No circumstances are now
known, however, that would prevent any of the nominees from serving. In
the election of directors, the designated proxies may cumulatively cast the
votes authorized by each proxy form received if such action is deemed by
them to be appropriate. Proxy forms cannot be voted for a greater number
of persons than the number of nominees named.
The seven nominees receiving the most votes cast in their favor at
the Annual Meeting will be elected as directors. Shares represented by
proxy forms withholding authority to vote for a named nominee will not be
voted for that nominee, and broker nonvotes will not be counted. The Board
of Directors is soliciting discretionary authority to vote shares
represented by signed proxy forms on which no vote is indicated for each of
the named nominees, or their substitutes, if any.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS
VOTE "FOR" THE ELECTION OF EACH OF THE BOARD'S NOMINEES.
The following information is furnished as of March 22, 1996, with
respect to each person nominated for election as a director at the 1996
Annual Meeting, each director whose term will continue after the 1996
Annual Meeting, and each nondirector executive officer of the Corporation
included in the summary compensation table on page 11. Unless otherwise
indicated, each person has been engaged in the listed occupation for the
past five years.
<TABLE>
<CAPTION>
Shares of
Director Common Stock
Name, Age, Principal Occupation or Position, or Executive Beneficially Percentage of
Other Directorships Officer Since Owned (1) Class (2)
- --------------------------------------------- ------------- ------------ -------------
<S> <C> <C> <C>
NOMINEE FOR A TERM ENDING IN 1998
GLEN BERRYMAN, 58. . . . . . . . . . . . . . . -- 8,115 *
Independent insurance agent,
Berryman Insurance
NOMINEES FOR A TERM ENDING IN 1999
JAMES T. HOLLOWAY, 65. . . . . . . . . . . . . 1994 51,897(3) *
Consultant, Peoples Security Finance Co.
Director, Southern Finance Co.
ALLAN B. KLEET, 47 . . . . . . . . . . . . . . 1986 67,616(4) *
Chief Financial Officer and Treasurer
of the Corporation
RUFUS E. PUGH, 61. . . . . . . . . . . . . . . 1987 7,956(5) *
President of Golden Eagle Distributing, Inc.,
a wholesale beer distributor
NEAL H. RAMAGE, 57 . . . . . . . . . . . . . . 1989 43,983(6) *
President and Chief Executive Officer
Peoples First of Livingston County
- 3 -
<PAGE>
<CAPTION>
Shares of
Director Common Stock
Name, Age, Principal Occupation or Position, or Executive Beneficially Percentage of
Other Directorships Officer Since Owned (1) Class (2)
- --------------------------------------------- ------------- ------------ -------------
<S> <C> <C> <C>
MARY WARREN SANDERS, 47. . . . . . . . . . . 1992 85,204(7) *
Certified Public Accountant with Michael D.
Pierce, CPA since 1992
Formerly with Richardson, Howe, and
Wilson, CPAs
VICTOR F. SPECK, JR., 60 . . . . . . . . . . 1987 39,194(8) *
President of Welders Supply Company, Inc.,
a supplier of welding products and
equipment
TO CONTINUE IN OFFICE UNTIL 1997
WALTER L. APPERSON, 63 . . . . . . . . . . . 1992 1,862 *
President and Chief Executive Officer,
Murray Ledger and Times, a daily newspaper
WILLIAM R. DIBERT, 58. . . . . . . . . . . . 1989 10,252 *
President and Chief Executive Officer of
Crounse Corporation, a river transportation
company
R. E. FAIRHURST, JR., 49 . . . . . . . . . . 1987 120,778(9) 1.3%
Owner of Fairhurst Realty, real estate brokers
DENNIS W. KIRTLEY, 52. . . . . . . . . . . . 1994 87,016(10) *
President and Chief Executive Officer
of First Kentucky Federal Savings Bank
AUBREY W. LIPPERT, 55. . . . . . . . . . . . 1983 201,407(11) 2.2%
Chairman of the Board, President, and Chief
Executive Officer of the Corporation;
Chairman of the Board and Chief Executive
Officer of PFNB
ALLAN RHODES, JR. 45 . . . . . . . . . . . . 1991 18,212(12) *
President of Bluegrass Honda-BMW, Inc., an
automobile dealership
TO CONTINUE IN OFFICE UNTIL 1998
JOE DICK, 68 . . . . . . . . . . . . . . . . 1992 30,376(13) *
Vice Chairman of the Corporation
Formerly Chairman and Chief Executive
Officer of Bank of Murray
WILLIAM ROWLAND HANCOCK, 48. . . . . . . . . 1989 35,810(14) *
President of Hancock Fabrics, Inc., a
fabrics retailer
ROBERT P. MERIWETHER, 49 . . . . . . . . . . 1987 142,744(15) 1.5%
Neurosurgeon
- 4 -
<PAGE>
<CAPTION>
Shares of
Director Common Stock
Name, Age, Principal Occupation or Position, or Executive Beneficially Percentage of
Other Directorships Officer Since Owned (1) Class (2)
- --------------------------------------------- ------------- ------------ -------------
<S> <C> <C> <C>
JOE HARRY METZGER, 66. . . . . . . . . . . . 1983 25,563(16) *
Vice President of R & M Grocery Co. since 1991
Former President of Metzger Packing Co., Inc.,
a meat packing company
JERRY L. PAGE, 62. . . . . . . . . . . . . . 1983 130,407(17) 1.4%
Business Consultant
C. STEVE STORY, 49 . . . . . . . . . . . . . 1994 3,809(18) *
President and Chief Executive Officer of
Peoples First of Calloway County
Formerly President and Chief Executive Officer
of Liberty Bank and Trust Co., Mayfield,
Kentucky
CERTAIN EXECUTIVE OFFICERS
GEORGE B. SHAW, 50 . . . . . . . . . . . . . 1993 5,181(19) *
President and Chief Operating
Officer of PFNB since 1993
Former President and Chief
Executive Officer of Bowling
Green Bank & Trust Co.
</TABLE>
-------------------------------------
* Represents 1% or less of the outstanding Common Stock.
(1) In the table above, the named person has sole voting and
dispositive power with respect to the reported shares unless
otherwise indicated. When joint ownership is noted, the joint
owners share voting and dispositive power with respect to the
shares. When holdings of a family member are included but are
noted as being held "individually," the family member has sole
voting and investment powers with respect to the indicated shares.
(2) Shares of Common Stock subject to currently exercisable options are
deemed outstanding for computing the percentage of class of the
person holding such options but are not deemed outstanding for
computing the percentage of class of any other person.
(3) Includes 51,202 shares owned jointly by Mr. Holloway and his wife.
(4) Includes 62,511 shares subject to currently exercisable stock
options, 675 shares held individually by Mr. Kleet's wife, and
2,917 shares held in Mr. Kleet's ESOP account for which he has
voting but no investment power. Mr. Kleet disclaims beneficial
ownership of the shares held by his wife.
(5) Includes 2,042 shares held jointly by Mr. Pugh and his wife.
(6) Includes 19,624 shares subject to currently exercisable stock
options, 602 shares held in Mr. Ramage's ESOP account for which he
has voting but no investment power, and 23,577 shares held jointly
by Mr. Ramage and his wife.
(7) Includes 9,437 shares held individually by Ms. Sanders' husband and
74,852 held in trust of which Ms. Sanders is beneficial owner with
voting and dispositive rights.
(8) Includes 5,328 shares held individually by Mr. Speck's wife.
- 5 -
<PAGE>
(9) Of the listed shares, Mr. Fairhurst's wife holds 5,821 shares
individually, and Mr. Fairhurst's sons hold 1,058 shares. In
addition, Mr. Fairhurst holds 70,560 shares as trustee for two
trusts created by his father's estate, with respect to which he has
sole voting and investment power.
(10) Includes 68,751 shares held jointly by Mr. Kirtley and his wife,
1,250 shares held individually by Mr. Kirtley's wife and 2,698
shares held in Mr. Kirtley's First Kentucky Federal ESOP account
for which he has voting but no investment power.
(11) Includes 119,621 shares subject to currently exercisable stock
options and 20,463 shares held in Mr. Lippert's ESOP account for
which he has voting but no investment power.
(12) Includes 17,771 shares held jointly by Mr. Rhodes and his wife.
(13) Includes 551 shares held jointly by Mr. Dick and his wife.
(14) Includes 6,062 shares held jointly by Mr. Hancock and his wife and
1,760 shares owned by Mr. Hancock's minor children.
(15) Includes 90,994 shares held by Dr. Meriwether as trustee for the
Meriwether PSC Pension Plan, for which he holds sole voting and
investment power.
(16) Includes 22,752 shares held individually by Mr. Metzger's wife.
(17) Includes 110,250 shares held in trust for the joint benefit of Mr.
Page and his wife.
(18) Includes 2,018 shares owned jointly by Mr. Story and his wife, and
1,653 shares subject to currently exercisable stock options.
(19) Includes 4,961 shares subject to currently exercisable stock
options.
-------------------------------------
The Corporation's subsidiary Banks have engaged, and expect to
engage in the future, in banking transactions in the ordinary course of
business with various directors and officers of the Corporation and the
Banks and with many of their associates on substantially the same terms
(including interest rates and collateral) as those prevailing at the time
for comparable transactions with others. In the opinion of management,
such loans did not involve more than normal risk of collectability or
present other unfavorable features. The aggregate balance of outstanding
loans to directors and officers of the Corporation and the Banks and
certain corporations and individuals related to such persons totaled
$13,445,000 or 10.5% of the Corporation's stockholders' equity as of
December 31, 1995.
COMMITTEES OF THE BOARD OF DIRECTORS
The Corporation's Executive Committee was established to assist the
Chairman with decision making issues that arise between regular quarterly
Board meetings. The Executive Committee also reviews and recommends to the
Board of Directors the compensation of the principal officers of the
Corporation and the Banks, and recommends persons to fill vacancies
existing on the Board of Directors. The Executive Committee met eleven
times during 1995. The present members of the Executive Committee are
Messrs. Apperson, Dick, Hancock, Meriwether, Page, Pugh and Speck.
The Corporation's Audit Review Committee, which is composed
entirely of non-management directors, reviews the audit plans and results
of audits of the Corporation and the Banks performed by the Corporation's
internal audit department and independent certified public accountants.
The Audit Committee also monitors the quality and composition of the
Corporation's loan portfolio and reviews reports of the Corporation's loan
review officers. Messrs. Fairhurst, Hancock, Rhodes, Speck and Ms.
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<PAGE>
Sanders were approved as members of the Audit Committee at the 1995 Annual
Meeting. The Audit Committee met five times during the year.
The following is the provision of the Corporation's Bylaws
regarding the nomination of directors by shareholders.
SECTION 2.13 NOMINATION OF DIRECTORS.
(a) Nominations for election to the Board of Directors may
be made by the Board of Directors or by any shareholder. Any
shareholder who intends to nominate or to cause to have nominated
any candidate for election to the Board of Directors (other than a
candidate nominated by the Board of Directors) shall deliver or
mail written notification of the nomination to the President not
less than fourteen days nor more than fifty days before any
meeting of shareholders called for the election of directors;
provided, however, that if less than twenty-one days' notice of the
meeting is given to shareholders, such notification shall be
delivered or mailed to the President not later than the close of
business on the seventh day following the notice of meeting was
mailed. Any such notification shall contain the following
information to the extent known to the notifying shareholder or
shareholders:
(1) The name and address of each proposed nominee;
(2) The principal occupation of each proposed nominee;
(3) The total number of shares that, to the knowledge of
the notifying shareholder or shareholders, will be
voted for each proposed nominee;
(4) The name and residence address of each notifying
shareholder; and
(5) The number of shares owned by each notifying
shareholder.
(b) The chairman of any meeting of shareholders held
for the election of directors may disregard any nomination for
director not made in accordance with the provisions of this
Section, and upon the instruction of the chairman, the inspectors
of election shall disregard all votes cast for any nominee whose
nomination was not made in accordance with the provisions of this
Section.
DIRECTOR COMPENSATION
The Board of Directors held a total of seven regularly scheduled
and special meetings during 1995. Directors who are not employees of the
Corporation generally receive an annual fee of $4,000 for their services.
Directors who are employees of the Corporation generally do not receive a
fee for their services, with the exception of Mr. Kirtley, Mr. Ramage and
Mr. Story. In 1995, all Directors attended at least 75 percent of the
total number of meetings of the Board of Directors and committees on which
they served as members.
Joe Dick, Vice Chairman and a director of the Corporation and the
former President, Chief Executive Officer and Chairman of Bank of Murray
(now Peoples First of Calloway County), has served as a consultant to
Peoples First of Calloway County since his retirement as of January 1,
1993. Under the terms of a consulting and non-competition agreement
between Mr. Dick and the Corporation, Mr.
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<PAGE>
Dick provides consulting services to Peoples First of Calloway County,
including advisory services with respect to marketing, business development
and operations, for a term through December 31, 1997. For his consulting
services, Mr. Dick is paid $100,000 per year.
Dennis W. Kirtley, a director of the Corporation and President of
First Kentucky Federal Savings Bank, entered into an employment agreement
with First Kentucky as of March 10, 1994. The employment agreement
provides for Mr. Kirtley's continued employment as President and Chief
Executive Officer of First Kentucky for three years from that date at a
base salary of $105,000 per year. Mr. Kirtley has the right to
compensation or other benefits after termination of employment only when
such termination is without "just cause" (as defined). If employment is
terminated without just cause, Mr. Kirtley is entitled to receive his
salary up to the date of termination of his employment agreement plus an
additional twelve-month period, but in no event more than three years'
salary, and the cost of his obtaining all health, life and disability
benefits for a period of one year from the date of termination, unless he
obtains comparable benefits elsewhere through other employment prior to the
end of the twelve-month period.
C. Steve Story, a director of the Corporation and President of
Peoples First of Calloway County, and formerly President and Chief
Executive Officer of Liberty Bank and Trust Co. (now Peoples First of
Graves County), entered into an employment agreement with Liberty Bank and
Peoples First dated as of October 7, 1994. The employment agreement
provides for Mr. Story's employment as President and Chief Executive
Officer of Liberty Bank, or in such other executive capacity as the Board
of Directors shall designate, for a three-year term expiring October 7,
1997, at an annual base salary of $105,000. In addition, Mr. Story can
earn an annual $35,000 bonus for satisfactory performance during each
calendar year and an additional annual $35,000 bonus based on the
performance of Peoples First of Calloway County, the Corporation, and Mr.
Story during each calendar year in accordance with mutually agreed upon
annual bonus programs. In accordance with the employment agreement, Mr.
Story was awarded a one-time grant of options to purchase 16,538 shares at
an exercise price of $17.69. Upon termination of his employment, Mr. Story
is entitled to receive salary and benefits payable during the term of his
employment agreement unless he voluntarily terminates his employment or his
employment is terminated for "cause" (as defined).
- 8 -
<PAGE>
REPORT OF THE EXECUTIVE COMMITTEE
ON EXECUTIVE COMPENSATION
The Corporation's Executive Committee is comprised entirely of independent,
nonemployee directors. The Executive Committee has the responsibility for
reviewing and recommending to the Board of Directors the compensation paid to
the executive officers of the Corporation.
The Corporation's executive compensation program is structured to help the
Corporation achieve its business objectives by:
- Setting levels of compensation designed to attract talented executives
in a highly competitive banking environment;
- Providing annual cash incentive compensation based on the
Corporation's attainment of targeted earnings or other appropriate
performance goals; and
- Providing long-term incentive compensation in the form of stock
options designed to align executives' interests with the interests of
the Corporation's shareholders.
BASE SALARIES
The Executive Committee recommends salary levels for the Corporation's
executive officers that are intended to be consistent with industry practice and
level of responsibility, with salary increases reflecting competitive trends,
the overall financial performance of the Corporation, and the performance of the
individual executive. The Corporation engages independent consultants from time
to time to assist with compensation policy issues. The recommendations for 1995
base salaries for executive officers were intended to approximate the median
base salaries paid to executives having similar responsibilities with banks or
bank holding companies of comparable asset size to the Corporation, based on
data compiled by the Corporation's consultant. Annual increases in base salary
are based on the Committee's assessment of each executive's performance and a
comparison of the executive's salary to the median for executives with similar
responsibilities at comparable institutions.
ANNUAL BONUS
To insure that a significant portion of compensation is based on
performance, the annual bonus payable to each executive officer of the
Corporation is based upon the attainment of a targeted performance ratio by the
Corporation or the affiliate that employs the executive officer. At the
beginning of each fiscal year, the Committee establishes the range of
performance objectives that will qualify for a bonus and budgets a certain
amount for the bonus based on a percentage of salary for participants at various
levels of responsibility. For 1995, the Corporation's two senior corporate
executives were eligible to earn a bonus based upon attainment of a specified
earnings per share target by the Corporation. The Presidents of the affiliate
Banks were eligible to earn a bonus based upon the attainment of specified loan
and deposit growth rates by their respective Banks. The percentage of salary
payable as a bonus ranges from 4.88% of salary for attainment of the minimum
performance target to a maximum of 25.12% for attaining or exceeding the highest
performance target. In 1995, the Corporation exceeded its earnings per share
targets by approximately 6%, earning the senior corporate officers a bonus of
19.29% of salary.
-9-
<PAGE>
STOCK OPTION GRANTS
To link a portion of incentive compensation to the market performance of
the Common Stock, the Corporation has periodically granted key employees stock
options under its 1986 Stock Option Plan (the "Option Plan"). The Option Plan,
as amended at the 1994 Annual Meeting, makes available for grants of options and
other stock-based incentive awards a number of shares equal to 10% of the total
number of shares of Common Stock issued and outstanding. In addition to
providing key employees an incentive to put forth maximum effort for the
Corporation's success, the Committee believes option grants appropriately give
key employees a common interest with its shareholders in the Corporation's long-
term share performance. In setting the number of shares subject to options and
other terms and conditions of an individual grant, the Committee considers the
individual's responsibilities and contribution to the success of the Corporation
and the individual Bank. The aggregate exercise price of the options granted to
an executive officer generally approximate the officer's annual salary, with
adjustments based upon the Committee's assessment of the officer's contribution
to the Corporation's performance. Consistent with the long-term incentive
purpose of option grants, each grant generally provides that options become
exercisable with respect to 10% of the underlying shares each year. In December
1995, the Committee recommended awards for options for 25,410 shares to the
named executive officers.
CHIEF EXECUTIVE OFFICER'S COMPENSATION IN 1995
In 1995, the Corporation's earnings per share increased by 11.3% to $1.57
per share, exceeding its earnings per share target by more than 6%. As a result,
under the Corporation's bonus formula, Mr. Lippert earned an annual bonus of
$43,402 or 19.29% of his base salary. Mr. Lippert's base salary for 1995 was not
increased over the level of 1994, when earnings increased by 2.6%. Earnings per
share for 1994 were affected by the completion of two significant acquisitions
in 1994, which were accounted for as poolings-of-interest, and costs associated
with the acquisitions. The Corporation's return on average equity and return on
average assets increased for 1995 to 12.46% and 1.19%, respectively, from 12.15%
and 1.11%, respectively, for 1994. In December 1995, Mr. Lippert was awarded
options for 12,600 shares of Common Stock having an aggregate exercise price
equal to 1.25 times his annual salary for 1995. The market price per share of
Common Stock at the end of 1995 was $22.38, compared to $17.69 and $23.13 at the
end of 1994 and 1993, respectively.
EXECUTIVE COMMITTEE
OF THE BOARD OF DIRECTORS
Walter L. Apperson William Rowland Hancock Rufus E. Pugh
Joe Dick Robert P. Meriwether Victor F. Speck, Jr.
Jerry L. Page
-10-
<PAGE>
SUMMARY COMPENSATION TABLE
The following table sets forth information with respect to the compensation
of the Corporation's Chief Executive Officer and its most highly compensated
executive officers whose total annual salary and bonus for 1995 exceeded
$100,000.
<TABLE>
<CAPTION>
Annual Compensation
-----------------------------
Other Long-Term All
Name and Principal Annual Compensation Other Com-
Position Year Salary Bonus Compensation(1) Options (#) pensation(2)
- --------------- ---- ------ ----- --------------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C>
AUBREY W. LIPPERT 1995 $225,000 $43,402 $0 12,600 $8,798
Chairman of the Board, 1994 225,000 0 0 13,230 8,657
President and Chief 1993 200,000 22,280 0 0 11,608
Executive Officer
of the Corporation,
Chairman of the Board
and Chief Executive
Officer of PFNB
ALLAN B. KLEET 1995 138,244 26,667 0 6,510 8,036
Chief Financial Officer 1994 129,200 0 0 5,513 7,389
and Treasurer 1993 110,000 12,254 0 0 6,427
of the Corporation
GEORGE B. SHAW 1995 133,560 0 0 6,300 7,765
President and Chief 1994 126,000 10,282 0 5,513 3,799
Operating Officer of 1993 69,231 58,000 0 11,025 218
PFNB(3)
DENNIS W. KIRTLEY 1995 107,096 8,674 10,200 0 6,372
President of First Kentucky 1994 107,341 9,132 10,200 0 6,225
Federal Savings Bank(4)
C. STEVE STORY 1995 105,000 7,000 7,950 0 6,215
President of Peoples 1994 72,000 7,250 5,900 16,538 11
First of Calloway County(5)
</TABLE>
- -------------------
(1) Does not include perquisites, the value of which in all cases did not
exceed 10% of the total of the named individual's salary and bonus. Listed
amounts represent fees for service as directors of the Corporation and
affiliate Banks.
(2) The following amounts are included in the above table. Contributions made
under the Employee Stock Ownership Plan in 1995 were Mr. Lippert $3,752;
Mr. Kleet $3,458; Mr. Shaw $3,341; Mr. Kirtley $2,819; Mr. Story $2,677.
Contributions made under the 401(k) Plan in 1995 were: Mr. Lippert $4,500;
Mr. Kleet $4,147; Mr. Shaw $4,007; Mr. Kirtley $3,213; Mr. Story $3,210.
Life insurance premiums paid in 1995 were Mr. Lippert $546; Mr. Kleet $431;
Mr. Shaw $417; Mr. Kirtley $340; Mr. Story $328.
(3) Mr. Shaw joined the Corporation as President and Chief Operating Officer of
PFNB on May 7, 1993.
(4) Mr. Kirtley became an executive officer upon First Kentucky Federal
Savings Bank's affiliation with the Corporation effective March 10, 1994.
(5) Mr. Story became an executive officer upon Liberty Bank and Trust Co.'s
affiliation with the Corporation effective October 7, 1994.
-11-
<PAGE>
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
Potential Realizable
Value at Assumed
Annual Rates of Stock
Price Appreciation for
Individual Grants Option/SAR Term(1)
- ---------------------------------------------------------------------------------------------------------------
Exercise
Number of Securities % of Total Options/ or Base
underlying Options/ SARs Granted to Price Expiration
Name SARs Granted Employees in 1995 ($/sh) Date 5% 10%
- ---- -------------------- ------------------ -------- ----------- -- ---
<S> <C> <C> <C> <C> <C> <C>
Aubrey W. Lippert 12,600 30.4% $22.38 12/19/2005 $177,348 $449,435
Allan B. Kleet 6,510 15.7% 22.38 12/19/2005 91,630 232,208
George B. Shaw 6,300 15.2% 22.38 12/19/2005 88,674 224,718
Dennis W. Kirtley 0 -- -- -- -- --
C. Steve Story 0 -- -- -- -- --
</TABLE>
- ---------------------
(1) If the market price of the Common Stock increased by 5% per year and 10%
per year for the ten years after the date of grant, the total increase in
shareholder value would be $136,614,000 and $346,208,000, respectively.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR END OPTION/SAR VALUES
<TABLE>
<CAPTION>
Number of Securities
Underlying Unexercised Value of Unexercised In-the-Money
Shares Acquired Value Options at Year End(#) Options at Year End($)
-------------------------------- ---------------------------------
<S> <C> <C> <C> <C> <C> <C>
Name on Exercise (#) Realized($) Exercisable(1) Unexercisable Exercisable(1) Unexercisable
- ---- --------------- ----------- -------------- ------------- -------------- -------------
Aubrey W. 0 $0 113,925 31,950 $1,683,719 $77,200
Lippert
Allan B. Kleet 0 0 59,535 16,805 852,823 55,018
George B. Shaw 0 0 4,725 17,025 31,038 45,338
C. Steve Story 0 0 1,575 14,175 7,763 69,863
</TABLE>
- --------------------
(1) Includes options that became exercisable on or before January 6, 1996.
-12-
<PAGE>
COMMON STOCK PERFORMANCE VERSUS NASDAQ STOCK MARKET (U.S.)
AND NASDAQ BANK STOCKS INDICES
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<CAPTION>
1990 1991 1992 1993 1994 1995
<S> <C> <C> <C> <C> <C> <C>
The Corporation $ 100.00 $ 130.59 $ 183.00 $ 293.57 $ 228.87 $ 297.75
NASDAQ Stock Market (U.S.) $ 100.00 $ 160.56 $ 186.87 $ 214.51 $ 209.69 $ 296.30
NASDAQ Bank Stock $ 100.00 $ 164.09 $ 238.85 $ 272.39 $ 271.41 $ 404.35
</TABLE>
The graph above assumes $100 invested on December 31, 1990 in the
Corporation's Common Stock, the NASDAQ Stock Market (U.S.) Index, and the NASDAQ
Bank Stocks Index, and assumes reinvestment of dividends.
13
<PAGE>
RATIFICATION OF APPOINTMENTS TO AUDIT COMMITTEE
The Board of Directors has appointed Messrs. Fairhurst, Hancock, Rhodes and
Speck and Ms. Sanders to serve on the Audit Committee, subject to ratification
by the Corporation's shareholders at the Annual Meeting. The ratification of
the appointments to the Audit Committee by the shareholders is not required by
law or by the Corporation's Bylaws. The Board of Directors is submitting this
matter to the shareholders in the belief that it is a good practice to do so.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS RATIFY THE APPOINTMENTS
OF THE MEMBERS OF THE AUDIT COMMITTEE.
In the absence of instruction to the contrary, shares represented by proxy
forms will be voted in favor of the ratification of the members of the Audit
Committee. If the number of the votes cast in favor of the ratification of the
appointments, does not exceed the number of votes cast against ratification,
the appointees will decline to serve, and the Board of Directors will appoint
other non-management directors to serve on the Audit Committee, whose
appointment will be subject to ratification by the shareholders at the 1997
Annual Meeting. Abstentions and broker nonvotes will not be counted as either
in favor or against this proposal.
INFORMATION CONCERNING INDEPENDENT AUDITORS
The firm of KPMG Peat Marwick LLP, Certified Public Accountants, has served
as independent auditors for the Corporation since its commencement of operations
in 1983. Representatives of KPMG Peat Marwick LLP will be present at the 1996
Annual Meeting and will have the opportunity to make a statement, if they desire
to do so, and to respond to appropriate questions.
GENERAL
All expenses of preparing, printing, mailing and delivering the Proxy
Statement and all materials used in the solicitation of proxy forms will be
borne by the Corporation. In addition to the use of the mails, proxy forms may
be solicited by personal interview, telephone, and telegraph by directors,
officers, and other employees of the Corporation, none of whom will receive
additional compensation for such services. The Corporation will also request
brokerage houses, custodians, and nominees to forward soliciting materials to
the beneficial owners of the Common Stock held of record by them and will pay
reasonable expenses of such persons for forwarding these materials.
SHAREHOLDER PROPOSALS
Any proposals by shareholders to be presented at the 1997 Annual Meeting
must be received by the Secretary of the Corporation prior to November 24, 1996,
to be included in the Proxy Statement for the 1997 Annual Meeting.
SECTION 16(A) REPORTING DELINQUENCIES
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
directors and officers of the Corporation and persons who beneficially own ten
percent or more of the Common Stock to file reports with the Securities and
Exchange Commission and the Corporation with respect to their beneficial
ownership of the Corporation's equity securities. Based on its review of the
reports furnished to the
- 14 -
<PAGE>
Corporation during and with respect to 1995, the Corporation believes that its
directors, officers, and beneficial owners have filed all required reports in a
timely manner.
OTHER MATTERS
The directors and officers of the Corporation do not know of any matters to
be presented for shareholder approval at the meeting other than those described
in the Proxy Statement. If any other matters should come before the meeting,
the Board of Directors intends that the persons designated on the enclosed proxy
form, or their substitutes, will vote the shares represented by the proxy form
in accordance with their best judgment on such matters.
A copy of the Corporation's Annual Report on Form 10-K as filed with the
Securities and Exchange Commission is available without charge by calling or
writing Allan B. Kleet, Chief Financial Officer, Peoples First Corporation, P.O.
Box 2200, Paducah, Kentucky 42002.
By Order of the Board of Directors.
A. Howard Arant
Secretary
PEOPLES FIRST CORPORATION
Paducah, Kentucky
March 25, 1996
- 15 -
<PAGE>
THIS PROXY FORM IS SOLICITED BY THE BOARD OF DIRECTORS
(PLEASE DATE, MARK, SIGN AND RETURN IMMEDIATELY)
PEOPLES FIRST CORPORATION
Paducah, Kentucky
The undersigned hereby appoints Henry O. Whitlow and Gary B. Houston, or
either one of them (with full power to act alone), my proxy, each with the power
to appoint his substitute, to represent me to vote all of the Corporation's
Common Stock which I held of record or am otherwise entitled to vote, at the
close of business on March 22, 1996, at the 1996 Annual Meeting of Shareholders
to be held on May 2, 1996, at 4:00 p.m., and at any adjournments thereof, with
all powers the undersigned would possess if personally present, as follows:
1. ELECTION OF DIRECTORS.
FOR all nominees listed below (except as otherwise indicated below)
---
AGAINST all nominees listed below
---
Glen Berryman, James T. Holloway, Allan B. Kleet, R. E. Pugh,
Neal Ramage, Mary Warren Sanders, Victor F. Speck
(INSTRUCTION: To withhold authority to vote for any individual nominee, write
the nominee's name on the line.)
---------------------------------------------------------
2. RATIFICATION OF APPOINTMENTS TO AUDIT COMMITTEE.
FOR AGAINST ABSTAIN
----- ----- -----
3. OTHER BUSINESS. In their discretion, the Proxies are authorized to act
upon such other matters as may properly be brought before the Annual
Meeting or any adjournment thereof.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ALL OF THE NOMINEES LISTED
IN ITEM 1 AND "FOR" ITEM 2.
This proxy form relates to ALL shares owned by the undersigned, including
any shares of Common Stock held in the undersigned's account under the
Corporation's Share Owner Dividend Reinvestment and Stock Purchase Plan.
This proxy form is solicited by the Board of Directors and will be voted as
specified and in accordance with the accompanying proxy statement. If no
instruction is indicated, this proxy form will be voted "FOR" all of the
nominees listed in Item 1 or cumulatively, at the discretion of the Board of
Directors, and "FOR" Item 2.
[PLEASE SIGN AND DATE ON BACK]
<PAGE>
Please sign exactly as name appears. When shares are held by joint
tenants, both should sign. When signing as attorney, as executor,
administrator, trustee or guardian, please give full title as such. If a
corporation, please sign full corporate name by President or other authorized
officer. If a partnership, please sign partnership name by authorized person.
Please check one of the following:
I will attend the Annual Meeting.
- ---
I will not attend the Annual Meeting.
- ---
Date , 1996
---------------
- -----------------------------------------------------------
Signature
- -----------------------------------------------------------
Signature if held jointly
<PAGE>
ESOP PARTICIPANT DIRECTION
(PLEASE DATE, MARK, SIGN AND RETURN IMMEDIATELY)
PEOPLES FIRST CORPORATION
Paducah, Kentucky
The undersigned hereby directs Peoples First National Bank, as Trustee
under the People First Employee Stock Ownership Plan (the "Plan") to appoint
Henry O. Whitlow and Gary B. Houston, or either one of them (with full power to
act alone), my proxy, each with the power to appoint his substitute, to
represent me to vote all of the Corporation's Common Stock held by the Plan for
my account at the close of business on March 22, 1996 that I am entitled to
vote, at the 1996 Annual Meeting of Shareholders to be held on May 2, 1996, at
4:00 p.m., and at any adjournments thereof, with all powers the undersigned
would possess if personally present, as follows:
1. ELECTION OF DIRECTORS.
FOR all nominees listed below (except as otherwise indicated
--- below)
AGAINST all nominees listed below
---
Glen Berryman, James T. Holloway, Allan B. Kleet, R. E. Pugh,
Neal Ramage, Mary Warren Sanders, Victor F. Speck
(INSTRUCTION: To withhold authority to vote for any individual nominee, write
the nominee's name on the line below.)
---------------------------------------------------------
2. RATIFICATION OF APPOINTMENTS TO AUDIT COMMITTEE.
FOR AGAINST ABSTAIN
--- --- ---
3. OTHER BUSINESS. In their discretion, the Proxies are authorized to
act upon such other matters as may properly be brought before the
Annual Meeting or any adjournment thereof.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ALL OF THE NOMINEES LISTED
IN ITEM 1 AND "FOR" ITEM 2.
This direction form will be voted as specified and in accordance with the
accompanying proxy statement. If no instruction is indicated, this direction
form will be voted "FOR" all of the nominees listed in Item 1 or cumulatively,
at the discretion of the Board of Directors, and "FOR" Item 2.
Date , 1996
--------------- ---------------------------------------------
Signature
