<PAGE>
<PAGE>
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 Subsection 240.14a-11(c) or
Subsection 240.14a-12
FRANKFORT FIRST BANCORP, INC.
- ----------------------------------------------------------------
(Name of Registrant as Specified in its Charter)
FRANKFORT FIRST BANCORP, INC.
- ----------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Rules 0-11(c)(1)(iii), 14a-6(i)(1), or
14a-6(i)(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 Rules
14a-6(i)(4) and 0-11.
1. Title of each class of securities to which
transaction applies:
_________________________________________________________________
2. Aggregate number of securities to which transaction
applies:
_________________________________________________________________
3. Per unit price or other underlying value of
transaction computed pursuant to Exchange Act Rule 0-11:
_________________________________________________________________
4. Proposed maximum aggregate value of transaction:
_________________________________________________________________
[ ] 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:
____________________________________________
2. Form, Schedule or Registration Statement No.:
____________________________________________
3. Filing Party:
____________________________________________
4. Date Filed:
____________________________________________<PAGE>
<PAGE>
October 10, 1996
Dear Fellow Stockholder:
You are cordially invited to attend the Annual Meeting of
Stockholders of Frankfort First Bancorp, Inc. to be held at the
main office of First Federal Savings Bank of Frankfort, 216 West
Main Street, Frankfort, Kentucky on Tuesday, November 12, 1996 at
4:30 p.m., local time. Your Board of Directors and Management
look forward to personally greeting those stockholders able to
attend.
The attached Notice of Annual Meeting and Proxy Statement
describe the formal business to be transacted at the meeting.
During the meeting, we will also report on the operations of the
Company. Directors and officers of the Company as well as
representatives of Grant Thornton LLP, the Company's independent
auditors, will be present to respond to any questions the
stockholders may have.
WE URGE YOU TO SIGN, DATE AND RETURN THE ENCLOSED PROXY CARD
AS SOON AS POSSIBLE EVEN IF YOU CURRENTLY PLAN TO ATTEND THE
ANNUAL MEETING. Your vote is important, regardless of the number
of shares you own. This will not prevent you from voting in
person but will assure that your vote is counted if you are
unable to attend the meeting. On behalf of your Board of
Directors, thank you for your interest and support.
Sincerely,
/s/ William C. Jennings
William C. Jennings
President<PAGE>
<PAGE>
_________________________________________________________________
FRANKFORT FIRST BANCORP, INC.
216 W. MAIN STREET
FRANKFORT, KENTUCKY 40602
(502) 223-1638
_________________________________________________________________
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held on November 12, 1996
_________________________________________________________________
NOTICE IS HEREBY GIVEN that the Annual Meeting of
Stockholders (the "Meeting") of Frankfort First Bancorp, Inc.
(the "Company"), will be held at the main office of First Federal
Savings Bank of Frankfort, 216 West Main Street, Frankfort,
Kentucky at 4:30 p.m. on Tuesday, November 12, 1996.
A Proxy Card and a Proxy Statement for the Meeting are
enclosed.
The Meeting is for the purpose of considering and acting
upon:
1. The election of three directors of the Company; and
2. The transaction of such other matters as may
properly come before the Meeting or any
adjournments thereof.
The Board of Directors is not aware of any other business to
come before the Meeting.
Any action may be taken on any one of the foregoing pro-
posals at the Meeting on the date specified above or on any date
or dates to which, by original or later adjournment, the Meeting
may be adjourned. Stockholders of record at the close of busi-
ness on September 30, 1996, are the stockholders entitled to
notice of and to vote at the Meeting and any adjournments
thereof.
You are requested to fill in and sign the enclosed form of
proxy which is solicited by the Board of Directors and to mail it
promptly in the enclosed envelope. The proxy will not be used if
you attend and vote at the Meeting in person.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Danny A. Garland
DANNY A. GARLAND
SECRETARY
Frankfort, Kentucky
October 10, 1996
_________________________________________________________________
IMPORTANT: THE PROMPT RETURN OF PROXIES WILL SAVE YOUR COMPANY
THE EXPENSE OF FURTHER REQUESTS FOR PROXIES IN ORDER TO ENSURE A
QUORUM. A SELF-ADDRESSED ENVELOPE IS ENCLOSED FOR YOUR
CONVENIENCE. NO POSTAGE IS REQUIRED IF MAILED IN THE UNITED
STATES. PLEASE ACT PROMPTLY.
_________________________________________________________________
<PAGE>
<PAGE>
_________________________________________________________________
PROXY STATEMENT
OF
FRANKFORT FIRST BANCORP, INC.
216 W. MAIN STREET
FRANKFORT, KENTUCKY 40602
ANNUAL MEETING OF STOCKHOLDERS
November 12, 1996
_________________________________________________________________
_________________________________________________________________
GENERAL
_________________________________________________________________
This Proxy Statement is furnished in connection with the
solicitation of proxies by the Board of Directors of Frankfort
First Bancorp, Inc. (the "Company") to be used at the Annual
Meeting of Stockholders of the Company (the "Meeting") which will
be held at the main office of First Federal Savings Bank of
Frankfort, 216 West Main Street, Frankfort, Kentucky on Tuesday,
November 12, 1996, at 4:30 p.m., local time. The accompanying
notice of meeting and this Proxy Statement are being first mailed
to stockholders on or about October 10, 1996.
_________________________________________________________________
VOTING AND REVOCABILITY OF PROXIES
_________________________________________________________________
Stockholders who execute proxies retain the right to revoke
them at any time. Unless so revoked, the shares represented by
such proxies will be voted at the Meeting and all adjournments
thereof. Proxies may be revoked by written notice to the Secre-
tary of the Company, at the address shown above, by filing of a
later dated proxy prior to a vote being taken on a particular
proposal at the Meeting or by attending the Meeting and voting in
person. Proxies solicited by the Board of Directors of the
Company will be voted in accordance with the directions given
therein. WHERE NO INSTRUCTIONS ARE INDICATED, PROXIES WILL BE
VOTED FOR THE NOMINEES FOR DIRECTOR SET FORTH BELOW AND IN FAVOR
OF EACH OF THE OTHER PROPOSALS SET FORTH IN THIS PROXY STATEMENT
TO BE CONSIDERED AT THE MEETING. The proxy confers discretionary
authority on the persons named therein to vote with respect to
the election of any person as a director where the nominee is
unable to serve or for good cause will not serve, and matters
incident to the conduct of the Meeting.
_________________________________________________________________
VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF
_________________________________________________________________
The securities entitled to notice of and to vote at the
Meeting consist of the Company's common stock, par value $.01 per
share (the "Common Stock"). Stockholders of record as of the
close of business on September 30, 1996 (the "Record Date"), are
entitled to one vote for each share of Common Stock then held.
As of the Record Date, there were 3,450,000 shares of Common
Stock issued and outstanding.
Persons and groups owning in excess of 5% of the Common
Stock are required to file certain reports regarding such
ownership pursuant to the Securities Exchange Act of 1934 with
the Company and the Securities and Exchange Commission ("SEC").
Based on such reports (and certain other written information
received by the Company), management knows of no persons other
than those set forth below who owned more than 5% of the
outstanding shares of Common Stock as of the Record Date. The
following table sets forth, as of the Record Date, certain
information as to those persons who were the beneficial owners of
more than five percent (5%) of the Company's outstanding shares
of Common Stock, the shares beneficially owned by the Company's
Chief Executive Officer and the shares of Common Stock
beneficially owned by all executive officers and directors of the
Company as a group.
1<PAGE>
<PAGE>
<TABLE>
<CAPTION>
AMOUNT AND PERCENT OF
NATURE OF SHARES OF
NAME AND ADDRESS BENEFICIAL COMMON STOCK
OF BENEFICIAL OWNERS OWNERSHIP OUTSTANDING
- ------------------ --------- ------------
<S> <C> <C>
C.M. Gatton 323,000 9.36%
State & 11th Streets
Bristol, Tennessee 37620
John Hancock Advisors, Inc. 229,418 6.65%
John Hancock Place
P.O. Box 111
Boston, Massachusetts 02117
Frankfort First Bancorp, Inc. 276,000 (1) 8.00%
Employee Stock Ownership Plan
216 W. Main Street
Frankfort, Kentucky 40602
William C. Jennings 50,301 1.46%
President and Chief
Executive Officer
All Executive Officers and 200,915 (2) 5.82%
Directors as a Group (9 persons)
<FN>
__________
(1) Includes 24,734 shares that have been allocated among
participating employees.
(2) Includes stock held in joint tenancy; stock owned as
tenants in common; stock owned or held by a spouse or other
member of the individual's household; stock allocated
through certain employee benefit plans of the Company; and
stock in which the individual either has or shares voting
and/or investment power. Each person or relative of such
person whose shares are included herein exercises sole or
shared voting and dispositive power as to the shares
reported. Does not include shares with respect to which
Directors Regan, Eddins and McGrath have "voting power" by
virtue of their positions as trustees of the trust holding
251,266 shares under the Company's ESOP. The ESOP trustees
must vote all allocated shares held in the ESOP in
accordance with the instructions of the participants.
Unallocated shares and allocated shares for which no timely
direction is received are voted by the ESOP trustees in
proportion to the participant-directed voting of allocated
shares. Does not include 138,000 shares held by the
Frankfort First Bancorp, Inc. Management Recognition Plan
(the "MRP"). Such shares are voted by the MRP trustees
(Directors Eddins, McGrath and Regan) in the same
proportion as the ESOP trustees vote the shares held in
the ESOP.
</FN>
</TABLE>
_________________________________________________________________
PROPOSAL I -- ELECTION OF DIRECTORS
_________________________________________________________________
The Company's Board of Directors is composed of eight
members. The Company's Certificate of Incorporation requires
that directors be divided into three classes, as nearly equal in
number as possible, each class to serve for a three year period,
with approximately one-third of the directors elected each year.
The Board of Directors has nominated David G. Eddins and William
C. Jennings both of whom are currently members of the Board, to
serve as directors for a three-year period. The Board has also
nominated C. Michael Davenport who was appointed to serve the
remaining term of Joe R. Johnson who passed away on July 17,
1996.
If any nominee is unable to serve, the shares represented by
all valid proxies will be voted for the election of such
substitute as the Board of Directors may recommend or the size of
the Board may be reduced to eliminate the vacancy. At this time,
the Board knows of no reason why any nominee might be unavailable
to serve.
2<PAGE>
<PAGE>
Under the Company's Bylaws, directors shall be elected by a
plurality of the votes of the shares present in person or by
proxy at the Meeting. Votes which are not cast at the Meeting,
either because of abstentions or broker non-votes, are not
considered in determining the number of votes which have been
cast for or against the election of a nominee.
Unless otherwise specified on the proxy, it is intended that
the persons named in the proxies solicited by the Board will vote
for the election of the named nominees.
The following table sets forth the names of the Board's
nominees for election as directors of the Company and of those
directors who will continue to serve as such after the Meeting.
Also set forth is certain other information with respect to each
person's age as of the Record Date, the year he first became a
director of the Company's wholly owned subsidiary, First Federal
Savings Bank of Frankfort (the "Bank" or "First Federal"), the
expiration of his term as a director, and the number and
percentage of shares of the Common Stock beneficially owned as of
the Record Date. With the exception of Mr. Davenport, all of the
individuals were initially appointed as director of the Company
in 1995 in connection with the Company's incorporation.
<TABLE>
<CAPTION>
Shares of
Age as Year First Common Stock
of the Elected as Current Beneficially
Record Director of Term Owned at the Percent
Name Date the Bank to Expire Record Date (1) of Class
- ---------------------------------------------------------------------------------------
BOARD NOMINEE FOR TERM TO EXPIRE IN 1999
<S> <C> <C> <C> <C> <C>
David G. Eddins 39 1993 1996 20,240 *
William C. Jennings(2) 60 1973 1996 50,301 1.46%
C. Michael Davenport 37 N/A(3) 1996 40,000 1.16%
DIRECTORS CONTINUING IN OFFICE
William M. Johnson 60 1984 1997 10,000 *
Frank McGrath 70 1973 1997 10,000 *
Herman D. Regan, Jr. 67 1988 1997 40,000 1.16%
Charles A. Cotton, III 58 1974 1998 3,000 *
Danny A. Garland 51 1981 1998 27,374 *
<FN>
_______________
* Less than 1%.
(1) Includes stock held in joint tenancy; stock owned as tenants
in common; stock owned or held by a spouse or other member
of the individual's household; stock allocated through
certain employee benefit plans of the Company; and stock in
which the individual either has or shares voting and/or
investment power. Each person or relative of such person
whose shares are included herein exercises sole or shared
voting and dispositive power as to the shares reported.
Does not include shares with respect to which Directors
Regan, Eddins and McGrath have "voting power" by virtue of
their positions as trustees of the trust holding 251,266
shares under the Company's ESOP. The ESOP trustees must
vote all allocated shares held in the ESOP in accordance
with the instructions of the participants. Unallocated
shares and allocated shares for which no timely direction is
received are voted by the ESOP trustees in proportion to the
participant-directed voting of allocated shares. Does not
include 138,000 shares held by the Frankfort First Bancorp,
Inc. Management Recognition Plan (the "MRP"). Such shares
are voted by the MRP trustees (Directors Eddins, McGrath and
Regan) in the same proportion as the ESOP trustees vote the
shares held in the ESOP.
(2) Mr. Jennings is the husband of Joyce H. Jennings, Vice
President and Treasurer of the Company.
(3) Mr. Davenport was appointed as director of the Company and
the Bank effective September 10, 1996 to serve the remaining
term of Joe R. Johnson who passed away on July 17, 1996.
</FN>
</TABLE>
3<PAGE>
<PAGE>
The principal occupation of each director of the Company
for the last five years is set forth below.
DAVID G. EDDINS is a self-employed certified public
accountant. He is currently a member of the Frankfort Area
Chamber of Commerce, the Kentucky Chamber of Commerce, and the
National Conference of Practicing CPAs.
WILLIAM C. JENNINGS has been an employee of First Federal
since 1963. He has served as President and Chairman of the Board
of First Federal since 1980. He is also currently Moderator and
Deacon for the Pigeon Fork Baptist Church. His wife, Joyce H.
Jennings, is Vice President and Treasurer of the Bank.
C. MICHAEL DAVENPORT is an auctioneer, builder, developer,
and real estate broker. He serves as President and CEO for C.
Michael Davenport, Inc. He presently serves on the board of the
Blue Ridge Assembly in North Carolina and the Kentucky Youth
Association and is a member of the Frankfort Home Builders
Association. He has served previously on the boards of P.U.S.H.
and the Franklin County Humane Society, has served as the
national director for the Home Builders, and was a past president
of the Frankfort Area Chamber of Commerce.
WILLIAM M. JOHNSON is a self-employed attorney in
Frankfort, Kentucky and currently serves as the attorney for the
Bank. He serves on the Board of Directors of the YMCA of
Frankfort, the Franklin County Development Corporation, and the
Frankfort Cemetery. Mr. Johnson is a member of the Kentucky
Chamber of Commerce, serves on the Board of Trustees of the
Kentucky Bar Center Headquarters, and is Secretary of the Capital
City Performing Arts Foundation.
FRANK MCGRATH has served as President of Frankfort Lumber
Company since 1989. Prior to this date, Mr. McGrath was manager.
He is a member of the Kentucky Lumber and Building Material
Association, the Frankfort/Franklin County Chamber of Commerce,
the Kentucky Chamber of Commerce, and the Lawrenceburg First
Christian Church.
HERMAN D. REGAN, JR. had served as Chairman of the Board
and President of Kenvirons, Inc., a civil and environmental
engineering consulting firm, since 1975, until he retired in
August 1994. He is a registered professional engineer, a member
of the Kentucky Society of Professional Engineers, and the
National Society of Professional Engineers. Mr. Regan is a
charter member of the Institute for Water Resources, APWA, and a
Director of the Baptist Health Care Systems. He is also a member
of the Kentucky-Tennessee Water Environment Federation, the
National Water Environment Federation, the American Public Works
Association, the First Baptist Church of Frankfort, Kentucky and
the University of Kentucky Alumni Association.
CHARLES A. COTTON, III has served as the Commissioner of
the Department of Housing, Building & Construction of the
Commonwealth of Kentucky since 1981. He is the past president
and a director of the National Conference of States on Building
Codes and Standards. He is also a past member of the YMCA of
Frankfort Board of Directors, a past Board member of Galileons
Home, President of the St. Vincent de Paul Society of Frankfort,
a Board member of the Coalition of Committed Christians Homeless
Shelter and Soup Kitchen and involved with the Simon House as a
Fundraiser.
DANNY A. GARLAND has been an employee of First Federal
since 1975 and has served as Vice President and Secretary of
First Federal since 1981. Mr. Garland also serves on the
Frankfort Chamber of Commerce and the Kentucky Book Fair. He is
a member of the Frankfort Optimist Club, the Bluegrass Striders
running Club, the Frankfort Board of Realtors, and the Capital
Community Economic and Industrial Development Authority. He is a
former Frankfort City Commissioner. He has served on the FCA
State Tournament Breakfast Committee, the Girls Sweet 16
Executive Committee, the Administrative Board of First United
Methodist Church and the Board of Directors of the YMCA of
Frankfort. He has also coached several youth basketball and
baseball teams in Frankfort.
4<PAGE>
<PAGE>
_________________________________________________________________
MEETINGS AND COMMITTEES OF THE BOARD OF DIRECTORS
_________________________________________________________________
The Boards of Directors of the Company and the Bank hold
regular semi-monthly meetings and hold special meetings as
needed. During the fiscal year ended June 30, 1996, the Board of
the Company met 12 times and the Board of the Bank met 23 times.
No director attended fewer than 75% in the aggregate of the total
number of Board meetings held while he was a member during the
fiscal year ended June 30, 1996 and the total number of meetings
held by committees on which he or she served during such fiscal
year.
The Board of Directors of the Company has standing
Executive, Loan, Audit and Investment Committees. The Audit
Committee for fiscal 1996 consisted of Directors David Eddins
(Chairman), Herman D. Regan, Jr. and Joe R. Johnson. The Audit
Committee met two times during fiscal year 1996. Due to the
death of Director Johnson, Director William M. Johnson will serve
on this committee in fiscal year 1997.
The Compensation Committee consists of Directors William C.
Jennings, Charles A. Cotton, III, William M. Johnson and Frank
McGrath. The Compensation Committee met once during fiscal year
1996. Effective with fiscal year 1997, Mr. Jennings resigned
from the Compensation Committee so that that committee would
consist entirely of non-employee directors.
The Company and the Bank also do not have standing
Nominating Committees. Under the Company's current Bylaws, the
Board of Directors or a committee appointed by the Board acts as
a nominating committee for selecting management's nominees for
election as directors. The full Board of Directors served as a
nominating committee for the nominees chosen for election as
directors at the Meeting. While the Board of Directors will
consider nominees recommended by stockholders, it has not
actively solicited recommendations from the Company's
stockholders for nominees nor, subject to the procedural
requirements set forth in the Company's Certificate of
Incorporation and Bylaws, established any procedures for this
purpose.
_________________________________________________________________
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
_________________________________________________________________
OVERVIEW AND OBJECTIVES. Composed of the full Board of
Directors, the Compensation Committee (the "Committee") of the
Board of Directors establishes the Company's and the Bank's
executive compensation policies. The Committee is responsible
for developing the Company's and the Bank's executive
compensation policies generally, and for implementing those
policies for the Company's and Bank's executive officers,
including the Chief Executive Officer. The Committee's overall
objectives in designing and administering the specific elements
of the Company's and the Bank's executive compensation program
include the following:
. To align executive compensation with increases in
stockholder value;
. To provide incentives for executive officers to promote
the success of the Bank and the Company;
. To attract, retain and motivate executive officers for
the long-term success of the Bank and the Company; and
. To facilitate stock ownership through the granting of
stock options and through share awards issued through
the ESOP and through a management recognition plan.
In furtherance of these objectives, the Company's and Bank's
executive compensation program consists of the following
components.
5<PAGE>
<PAGE>
. Base Salary. The Board of Directors of the Bank
approved the terms of employment agreements with William C.
Jennings, Chairman and President of the Company and the Bank,
Danny A. Garland, Vice President and Secretary of the Company and
the Bank, and Joyce H. Jennings, Vice President and Treasurer of
the Company and the Bank. These agreements set forth the base
salary of such executive officers. In establishing base
salaries, the Committee considers a number of factors, including
the officer's experience, tenure, abilities and performance and
reviews regional and national surveys of salaries paid to
executive officers of other savings and loan holding companies
and other financial institutions similar in size and other
characteristics. The Committee's objective is to provide for
base salaries that are competitive with the average salary paid
by the Company's peers.
. Bonuses. Historically, bonuses have been paid at the
end of the calendar year and end of the fiscal year at the
discretion of the Board. Bonus payments in the past have been
less than fifteen (15%) percent of the annual compensation of the
employee.
Historically, the board has authorized a December bonus
for all employees of just over eight (8%) percent of annual base
compensation and, based upon profitability, has sometimes paid
just over four (4%) percent of annual base compensation as a
bonus in June. The Board anticipates that similar bonus payments
will continue to be made.
. Stock Related Award Plans. The Committee believes that
stock related award plans are an important element of
compensation since they provide executives with incentives linked
to the performance of the Common Stock.
Stock Option and Incentive Plan. In connection with the
Bank's stock conversion, the Company adopted the Frankfort First
Bancorp, Inc. 1995 a Stock Option and Incentive Plan (the "Option
Plan") as a means of providing directors and key employees the
opportunity to acquire a proprietary interest in the Company and
to align their interests with those of the Company's
stockholders. By encouraging stock ownership, the Company seeks
to attract, retain and motivate the best available personnel for
positions of substantial responsibility and to provide additional
incentive to directors and employees of the Company and the Bank
to promote the success of the business of the Company.
Under this plan, participants are eligible to receive stock
options and stock appreciation rights ("SARs"). Awards under
this plan are subject to vesting and forfeiture as determined by
the Committee. Options and SARs are granted at the market value
of the Common Stock on the date of the grant. Thus, such awards
have value only if the Company's stock price increases. The
Committee believes that this plan aligns stockholder and
officer's interests and helps to retain and motivate executive
officers to improve long-term stockholder value. On January 16,
1996, subsequent to receipt of stockholder approval of the Option
Plan, the Committee awarded a total of 344,655 options, of which
241,155 were awarded to executive officers, to purchase shares of
Common Stock at an exercise price of $13.00 per share, the fair
market value of the Common Stock on the date of grant. Such
options vest in 20% increments over a period of five years from
the date of grant.
Management Recognition Plan. In connection with the Bank's
stock conversion, the Company adopted the Frankfort First
Bancorp, Inc. Management Recognition Plan (the "MRP") to reward
personnel of experience and ability in key positions of
responsibility, and to encourage their continued service with the
Company and the Bank. Under this plan, executive officers,
directors and employees may be awarded an aggregate of 138,000
shares of Common Stock upon approval of the plan by stockholders.
Awards under this plan vest over a period of five years, and will
be subject to forfeiture in the event employment is terminated
prior to that time. The Committee believes that because
allocations under this plan increases an executive's ownership
interest in the Company, they will further align the interests of
executives with those of the Company's stockholders generally,
and will thus increase their sensitivity to the interests of such
stockholders and their attentiveness to the promotion of long-
term stockholder value. On January 16, 1996, subsequent to
receipt of stockholder approval of the MRP, the Committee awarded
a total of 138,000 shares of restricted Common Stock, including
71,760 shares to executive officers of the Company.
6<PAGE>
<PAGE>
Deferred Compensation Plan. The Bank established on
September 24, 1994 a deferred compensation plan for the benefit
of the directors and the President and Vice Presidents of the
Bank. Pursuant to the terms of this plan, eligible individuals
may elect to defer receipt of up to 25% of their future
compensation. Deferred amounts are credited to a bookkeeping
account in the individual's name. Such accounts are credited
quarterly with the investment return which would have resulted if
such amounts had been invested, based on the individual's choice,
in either the Common Stock or the Bank's highest annual rate of
interest on certificates of deposit, regardless of term. Among
the purposes of this plan is to attract and retain directors and
executive officers by permitting them to elect to have Common
Stock measure the appreciation or depreciation of their deferred
compensation and to provide them with a direct equity interest in
the Company and thereby strengthen the connection between the
interest of officers and directors and the interest of the
Company's stockholders.
Other Compensation Plans. The Company and the Bank have
also adopted certain broad-based employee benefit plans in which
executive officers have been permitted to participate, including
the Bank's retirement fund. Executive officers also participate
in the Company's ESOP which, provided certain vesting
requirements are met, allows executive officers to receive awards
of Common Stock, thus further aligning the long-term financial
interests of stockholders and executive officers. Pursuant to
the terms of the ESOP, a total of 6,838 shares were allocated to
executive officers of the Company, including 2,734 shares to Mr.
Jennings.
COMPENSATION OF THE CHIEF EXECUTIVE OFFICER
Mr. Jennings has been employed by the Bank for over 32
years, and has served as President and Chief Executive Officer
for over 15 years. In establishing Mr. Jennings' compensation
generally, the Committee takes into account regional and national
surveys of salaries paid to chief executive officers of other
savings and loan holding companies and other financial
institutions similar in size and other characteristics. Mr.
Jennings does not participate in Committee decisions governing
his compensation or benefits.
For future years, Mr. Jennings' base salary will be
established in accordance with the terms of the employment
agreement entered into between the Bank and Mr. Jennings. See
"Executive Compensation - Employment Agreements." The Bank's
Board of Directors, acting as the Compensation Committee, voted
to increase Mr. Jennings' base salary to $80,000 per year
beginning in September 1994. The Board determined that even with
this increase, Mr. Jennings' salary was below that of many other
banks of similar size and activities. The Board also determined
that the increase was appropriate given the added responsibility
involved in managing a stock-owned company. The Compensation
Committee reviewed Mr. Jennings base salary during fiscal year
1995 and determined to keep it at its current level. On January
16, 1996, Mr. Jennings was awarded options to purchase 80,385
shares of Common Stock at an exercise price of $13.00 per share,
subject to a five year vesting schedule. In addition, Mr.
Jennings was granted 24,840 shares of restricted stock under the
MRP.
The Committee believes that the Company's executive
compensation program serves the Company and all of its
stockholders by providing a direct link between the interest of
executive officers and those of stockholders generally, and by
helping to attract and retain qualified executive officers who
are dedicated to the long-term success of the Company.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
In fiscal 1996, Mr. William C. Jennings, Chairman, President
and Chief Executive Officer of the Company served on the
Compensation Committee of the Board of Directors. He also served
as an executive officer of the Company. Mr. Jennings did not
participate in decisions of the Compensation Committee with
respect to his compensation. Effective with fiscal 1997, Mr.
Jennings resigned from the Compensation Committee so that that
committee would consist entirely of non-employee directors.
THE COMPENSATION COMMITTEE
William C. Jennings
Charles A. Cotton, III
William M. Johnson
Frank McGrath
7<PAGE>
<PAGE>
_________________________________________________________________
EXECUTIVE COMPENSATION
_________________________________________________________________
SUMMARY COMPENSATION TABLE
The following table sets forth cash and noncash compensation
for each of the last three fiscal years awarded to or earned by
the Chief Executive Officer of the Company and the Bank. No
other executive officer received salary and bonus in excess of
$100,000 during the fiscal year ended June 30, 1996.
<TABLE>
<CAPTION>
Long-Term
Compensation Awards
Annual Compensation -----------------------
Name and ------------------------------- Restricted Securities All
Principal Fiscal Other Annual Stock Underlying Other
Position Year Salary Bonus Compensation(1) Award(s)(2) Options Compensation
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
William C. Jennings 1996 $80,000 $6,666 $ 7,200 $322,920 (3) 80,385 $26,004(4)
President and Chief 1995 77,667 9,222 6,600 -- -- 5,680
Executive Officer 1994 64,800 8,875 6,000 -- -- --
<FN>
________________
(1) "Other Annual Compensation" represents directors' fees.
(2) Calculated as the number of shares of restricted stock
awarded (24,840 shares) multiplied by the closing market
price of the Common Stock ($13.00) on the date of grant.
(3) As of June 30, 1996, Mr. Jennings held 24,840 shares of
restricted Common Stock awarded under the Company's
management recognition plan ("MRP") with an aggregate value
of $298,080 based on the closing price of the Common Stock on
June 30, 1996. These shares vest at the rate of 20% per year
from the date of grant (January 16, 1996), subject to
accelerated vesting upon death or disability. Dividends are
payable on these shares to the extent paid on the Common
Stock generally.
(4) Consists of contributions by the Company to Mr. Jennings'
account in the ESOP.
</FN>
</TABLE>
OPTION/SAR EXERCISES AND YEAR-END VALUE TABLE
The following table sets forth information concerning the
value of options held by the Chief Executive Officer at June 30,
1996.
<TABLE>
<CAPTION>
Number of Securities Value of Unexercised
Underlying Unexercised In-the-Money Options
Options at Fiscal Year-End at Fiscal Year-End (1)
---------------------------- -----------------------------
Name Exercisable Unexercisable Exercisable Unexercisable
- ---- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
William C. Jennings $ -- 80,385 $ -- $ N/A (2)
<FN>
__________
(1) Represents the difference between the fair market value of
the underlying shares of Common Stock at fiscal year-end and
the exercise price.
(2) The exercise price of Mr. Jennings' options ($13.00 per
share) exceeded the fair market value of the Common Stock at
June 30, 1996.
</FN>
</TABLE>
8<PAGE>
<PAGE>
OPTION GRANTS IN LAST FISCAL YEAR
The following table contains information concerning the
grants of stock options under the Option Plan to the Company's
Chief Executive Officer.
<TABLE>
<CAPTION>
Individual Grants
-------------------------------------------------------------- Potential Realizable
Number of % of Total Value at Assumed Annual
Securities Options Market Rates of Stock Price
Underlying Granted to Price on Appreciation for Option Term (2)
Options Employees in Exercise Date of Expiration --------------------------------
Name Granted (1) Fiscal Year Price Grant Date 5% 10%
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
William C. Jennings 80,385 33.3% $13.00 $13.00 1/15/06 $658,353 $1,661,558
<FN>
____________
(1) All options vest at the rate of 20% per year from the
effective date of grant, January 16, 1996. To the extent not
already exercisable, the options generally will become
immediately exercisable in the event of a change in control
of the Company, generally defined as the acquisition of
beneficial ownership of 25% or more of the Company's voting
securities by any person or group of persons.
(2) Calculated as (i) the difference between (a) the product of
the per share market price of the Common Stock at the time of
grant and the sum of 1 plus the adjusted stock price
appreciation rate (5% or 10%, compounded annually over the
term of the option, and (b) the exercise price of the option,
(ii) multiplied by the number of shares underlying the
option.
</FN>
</TABLE>
PENSION PLAN
Effective July 1, 1994, the Bank adopted the FIRF Pension
Trust (the "Pension Plan") for the benefit of all employees who
are at least 21 years of age and have completed one year of
service. A participant becomes fully vested after six years of
service.
The following table illustrates annual pension benefits at
age 65 under the Pension Plan at various levels of compensation
and years of service, assuming 100% vesting of benefits. All
retirement benefits illustrated in the table below are without
regard to any Social Security benefits to which a participant
might be entitled.
<TABLE>
<CAPTION>
Years of Service
Average ---------------------------------------------
Compensation 15 20 25 30 35
- -------------- ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
$ 20,000 $ 3,750 $ 5,000 $ 6,250 $ 7,500 $ 8,750
40,000 7,500 10,000 12,500 15,000 17,500
60,000 11,250 15,000 18,750 22,500 26,250
80,000 15,000 20,000 25,000 30,000 35,000
100,000 18,750 25,000 31,250 37,500 43,750
</TABLE>
Participants in the Pension Plan will receive an annual
benefit based on average salary and years of service at the time
of retirement, which is not subject to offset for social security
payments. Average salary for purposes of determining a
participant's benefit consists of salary only, exclusive of
overtime, bonuses and other special payments. At June 30, 1996,
Mr. Jennings had 32 years of credited service under the Pension
Plan.
9<PAGE>
<PAGE>
SELECTED BENEFIT PLANS AND ARRANGEMENTS
Deferred Compensation Plan. The Bank's Board of Directors
has established as of September 27, 1994 the First Federal
Savings Bank of Frankfort Deferred Compensation Plan (the
"Deferred Compensation Plan") for the exclusive benefit of
members of the Bank's Board of Directors and the President and
Vice Presidents of the Bank. Pursuant to the terms of the
Deferred Compensation Plan, directors may elect to defer the
receipt of all or part of their future fees, and eligible
officers may elect to defer receipt of up to 25% of their future
compensation. Deferred amounts are credited to a bookkeeping
account in the participant's name, which will also be credited
quarterly with the investment return which would have resulted if
such deferred amounts had been invested, based upon the
participant's choice in either the Common Stock or the Bank's
highest annual rate of interest on certificates of deposit,
regardless of their term. Participants may cease future
deferrals any time. Changes in participant elections generally
become effective only as of the following January 1st, except
that elections designating a beneficiary or ceasing future
contributions are given immediate effect.
A participant may elect to have the amounts deferred and any
related accumulated earnings thereon distributed beginning during
the first 15 days of January of either the calendar year
immediately following termination of employment, a specific date
following employment not later than the year in which the
participant will attain 70 years of age, or the year in which the
participant attains 70 years of age. At the election of the
participants, distributions will either be in a lump sum or
monthly over a period of not more than 10 years. Participants
may change elections as to the timing or form of distributions
only with respect to subsequently deferred compensation. The
Bank contributes the aggregate amounts deferred to a trust
associated with the Deferred Compensation Plan. Contributions to
such trust are made on a quarterly basis and the funds used for
eventual payments to participants. The trust is administered by
Don D. Jennings, Vice President of the Bank, who is the son of
William C. Jennings and Joyce H. Jennings.
Employment Agreements. The Company and the Bank have
entered into separate employment agreements (the "Employment
Agreements") with William C. Jennings, Chairman of the Board and
President of First Federal and of the Company; Danny A. Garland,
Vice President and Secretary of First Federal and the Company;
and Joyce H. Jennings, Vice President and Treasurer of First
Federal and the Company (collectively, the "Executives"). In
such capacities, the Executives are responsible for overseeing
all operations of First Federal and the Company, and for
implementing the policies adopted by the Boards of Directors of
the Company and the Bank. The Boards believe that the Employment
Agreements assure fair treatment of the Executives in relation to
their careers with the Company and First Federal by assuring them
of some financial security.
The Employment Agreements became effective on the date of
completion of the conversion of the Bank to stock form and
provide for a term of three years, with an annual base salary for
Mr. Jennings, Mr. Garland and Ms. Jennings equal to $80,000,
$65,000 and $55,000, respectively. On each anniversary date from
the date of commencement of the Employment Agreements, the term
of employment will be extended for an additional one-year period
beyond the then-effective expiration date, upon a determination
by the Boards of Directors that the performance of the Executive
has met the required performance standards and that such
Employment Agreement should be extended. The Employment
Agreements provide the Executives with a salary review by the
Board of Directors not less often than annually, as well as with
inclusion in any discretionary bonus plans, retirement and
medical plans, customary fringe benefits and vacation and sick
leave and reimbursement for reasonable out-of-pocket expenses.
Each Employment Agreement will terminate upon death or
disability, and is terminable by First Federal for "just cause"
as defined in the Employment Agreement. In the event of
termination for just cause, no severance benefits are available.
If the Company or First Federal terminates an Executive without
just cause, he or she will be entitled to a continuation of his
salary and benefits from the date of termination through the
remaining term of his or her Employment Agreement plus an
additional 12-month period. If an Employment Agreement is
terminated due to the Executive's "disability" (as defined in the
Employment Agreement), he or she will be entitled to a
continuation of his or her salary and benefits for the period
preceding such termination of employment. In the event of an
Executive's death during the term of his or her Employment
Agreement, his or her estate will be entitled to
10
<PAGE>
receive his or her salary through the end of the month of the
Executive's death. Severance benefits payable to the Executive
or to his or her estate will be paid in a lump sum or in
installments, as he or she (or his or her estate) elects. An
Executive is able to voluntarily terminate his or her Employment
Agreement by providing 60 days' written notice to the Boards of
Directors of First Federal and the Company, in which case he or
she is entitled to receive only his or her compensation, vested
rights and benefits up to the date of termination.
Each Employment Agreement contains provisions stating that
in the event of the Executive's involuntary termination of
employment in connection with, or within one year after, any
change in control of First Federal or the Company, other than for
"just cause," the Executive will be paid within 10 days of such
termination an amount equal to the difference between (i) 2.99
times his "base amount," as defined in Section 280G(b)(3) of the
Internal Revenue Code, and (ii) the sum of any other parachute
payments, as defined under Section 280G(b)(2) of the Internal
Revenue Code, that he or she receives on account of the change in
control. "Control" generally refers to the acquisition, by any
person or entity, of the ownership or power to vote more than 25%
of First Federal's or Company's voting stock, the control of the
election of a majority of First Federal's or the Company's
directors, or the exercise of a controlling influence over the
management or policies of First Federal or the Company. In
addition, under the Employment Agreements, a change in control
occurs when, during any consecutive two-year period, directors of
the Company or First Federal at the beginning of such period
cease to constitute two-thirds of the Board of Directors of the
Company or First Federal, unless the election of replacement
directors was approved by a two-thirds vote of the initial
directors then in office. The Employment Agreements with First
Federal provide that within five business days of a change in
control, First Federal shall fund, or cause to be funded, a trust
in the amount of 2.99 times his or her base amount, that will be
used to pay the Executive amounts owed to him or her upon
termination other than for just cause within one year of the
change in control. The amount to be paid to each Executive from
this trust upon his or her termination is determined according to
the procedures outlined in the Employment Agreements with First
Federal, and any money not paid to the Executive is returned to
First Federal. The Employment Agreements also provide for a
similar lump sum payment to be made in the event of an
Executive's voluntary termination of employment within one year
following a change in control, upon the occurrence, or within 90
days thereafter, of certain specified events following the change
in control, which have not been consented to in writing by the
Executive, including (i) the requirement that he or she perform
his or her principal executive functions more than 35 miles from
First Federal's current primary office, (ii) a reduction in his
or her base compensation as then in effect, (iii) the failure of
the Company or First Federal to maintain existing or
substantially similar employee benefit plans, including material
vacation, fringe benefits, stock option and retirement plans,
(iv) the assignment to an Executive of duties and
responsibilities which are other than those normally associated
with his or her position with First Federal, (v) a material
reduction in his or her authority and responsibility, and (vi) in
the case of Mr. Jennings and Mr. Garland, the failure to re-elect
them to the Company's or First Federal's Board of Directors. The
aggregate payments that would be made to Mr. Jennings, Mr.
Garland and Ms. Jennings assuming their termination of employment
under the foregoing circumstances at June 30, 1996 would have
been approximately $226,454, $189,000 and $153,522, respectively.
These provisions may have an anti-takeover effect by making it
more expensive for a potential acquiror to obtain control of the
Company. Under the terms of the Employment Agreements, in the
event that an Executive prevails over the Company and First
Federal in a legal dispute as to his or her Employment Agreement,
he or she will be reimbursed for his or her legal and other
expenses.
_________________________________________________________________
DIRECTORS' COMPENSATION
_________________________________________________________________
Fees. The Bank's directors receive fees of $600 per month
and $100 per meeting for certain committee meetings. During
fiscal 1996, directors' fees totaled $59,800. Directors do not
receive separate compensation for service on the Board of
Directors of the Bank. Pursuant to the Frankfort First Bancorp,
Inc. Stock Option and Incentive Plan (the "Option Plan"), non-
employee directors of the Company received automatic grants of
stock options in fiscal year 1996. Each director who was not an
employee on the effective date of the Option Plan (Directors
Cotton, Eddins, Johnson, McGrath and Regan) received options to
purchase 17,250 shares of Common Stock at an exercise price equal
to the fair market value of the Common Stock on the date of grant
($13 per share),
11<PAGE>
<PAGE>
subject to adjustment in certain circumstances. All such options
will expire on January 16, 2006. In addition, pursuant to the
MRP, non-employee directors each received a plan share award of
6,900 shares of restricted Common Stock. Such shares vest at the
rate of 20% per year from the effective date of the award
(January 16, 1996).
_________________________________________________________________
TRANSACTIONS WITH MANAGEMENT
_________________________________________________________________
Director William M. Johnson received fees for services
rendered as the Bank's attorney in the amount of $19,655 for
fiscal year 1996.
First Federal offers loans to its directors, officers, and
employees. These loans currently are made in the ordinary course
of business with the same collateral, interest rates and
underwriting criteria as those of comparable transactions
prevailing at the time and to not involve more than the normal
risk of collectibility or present other unfavorable features.
Under current law, First Federal's loans to directors and
executive officers are required to be made on substantially the
same terms, including interest rates, as those prevailing for
comparable transactions and must not involve more than the normal
risk of repayment or present other unfavorable features.
Furthermore, loans above the greater of $25,000 or 5% of First
Federal's capital and surplus (i.e., up to $1.8 million) to such
persons must be approved in advance by a disinterested majority
of the Board of Directors. At June 30, 1996, First Federal's
loans to directors and executive officers totalled $272,000, or
0.8% of the Bank's retained earnings at that date.
12<PAGE>
<PAGE>
STOCK PERFORMANCE GRAPH
The graph and table which follow show the cumulative total
return on the Common Stock since the commencement of trading or
the Common Stock on July 10, 1995 compared with the cumulative
total return of (i) the Nasdaq Stock Market Index -- U.S.; and
(ii) the Nasdaq Stock Market Bank Index. Cumulative total return
on the stock or the index equals the total increase in value
since July 10, 1995, assuming reinvestment of all dividends paid
on the stock or the index, respectively. The graph and table
were prepared assuming that $100 was invested at the closing
price on July 10, 1995 in the Common Stock and in each of the
indices. The shareholder returns shown on the performance graph
are not necessarily indicative of the future performance of the
Common Stock or of any particular index.
Line graph appears hear depicting the current value of $100
invested in Frankfort First Bancorp, Inc. on July 10, 1995
through June 30, 1996 as being $164 compared with $123 for a $100
investment in the Nasdaq Stock Market Index - U.S. and $127 for a
$100 investment in the Nasdaq Stock Market Bank Index.
<TABLE>
<CAPTION>
7/10/95 6/30/96
------- -------
<S> <C> <C>
Frankfort First Bancorp, Inc. 100 164
Nasdaq Stock Market Index - U.S. 100 123
Nasdaq Stock Market Bank Index 100 127
</TABLE>
13<PAGE>
<PAGE>
_________________________________________________________________
RELATIONSHIP WITH INDEPENDENT AUDITORS
_________________________________________________________________
Butler & Associates, P.S.C. was the Company's independent
certified public accountant for the 1995 fiscal year. On March
27, 1996, the Company, with the approval of the Board of
Directors, decided to dismiss Butler & Associates, P.S.C., and to
engage Grant Thornton LLP. Butler & Associates, P.S.C. served as
the Company's independent public auditors from 1987 through the
fiscal period ended June 30, 1995. The Board of Directors'
decision to engage Grant Thornton LLP is based on the resources
of that firm's community-based financial institution practice.
Butler & Associates, P.S.C.'s reports on the financial statements
of the Company for the past two fiscal years did not contain any
adverse opinion or disclaimer of opinion, nor were they qualified
or modified as to uncertainty, audit scope or accounting
principles. There have not been any disagreements between the
Company and Butler & Associates, P.S.C. on any matter of
accounting principles or practices, financial statement
disclosure or auditing scope or procedure which, if not resolved
to the satisfaction of Butler & Associates, P.S.C., would have
caused it to make reference to the subject matter of such
disagreement in connection with its report.
The Board of Directors presently intends to renew the
Company's arrangement with Grant Thornton LLP to be its
independent certified public accountant for the fiscal year
ending June 30, 1997. A representative of Grant Thornton LLP is
expected to be present at the Meeting to respond to appropriate
questions and to make a statement, if so desired.
_________________________________________________________________
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
_________________________________________________________________
Pursuant to regulations promulgated under the Exchange Act,
the Company's officers, directors and persons who own more than
ten percent of the outstanding Common Stock are required to file
reports detailing their ownership and changes of ownership in
such Common Stock, and to furnish the Company with copies of all
such reports. Based solely on its review of the copies of such
reports received during the past fiscal year or with respect to
the past fiscal year, the Company believes that, during the
fiscal year ended June 30, 1996, all of its officers, directors
and stockholders owning in excess of 10% of the Company's
outstanding Common Stock complied with these requirements.
_________________________________________________________________
OTHER MATTERS
_________________________________________________________________
The Board of Directors is not aware of any business to come
before the Meeting other than those matters described above in
this Proxy Statement. However, if any other matters should pro-
perly come before the Meeting, it is intended that proxies in the
accompanying form will be voted in respect thereof in accordance
with the determination of the Board of Directors.
_________________________________________________________________
MISCELLANEOUS
_________________________________________________________________
The cost of soliciting proxies will be borne by the Company.
The Company will reimburse brokerage firms and other custodians,
nominees and fiduciaries for reasonable expenses incurred by them
in sending proxy materials to the beneficial owners of Common
Stock. In addition to solicitations by mail, directors, officers
and regular employees of the Company may solicit proxies
personally or by telegraph or telephone without additional
compensation.
14<PAGE>
<PAGE>
The Company's Annual Report to Stockholders, including
financial statements, is being mailed to all stockholders of
record as of the Record Date. Any stockholder who has not
received a copy of such Annual Report may obtain a copy by
writing to the Secretary of the Company. Such Annual Report is
not to be treated as a part of the proxy solicitation material or
as having been incorporated herein by reference.
_________________________________________________________________
STOCKHOLDER PROPOSALS
_________________________________________________________________
In order to be eligible to be considered for inclusion in
the Company's proxy materials for next year's Annual Meeting of
Stockholders, any stockholder proposal to take action at such
meeting must be received at the Company's executive office at 216
W. Main Street, Frankfort, Kentucky 40602, no later than June 12,
1997. Any such proposal shall be subject to the requirements of
the proxy rules adopted under the Exchange Act.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Danny A. Garland
DANNY A. GARLAND
SECRETARY
Frankfort, Kentucky
October 10, 1996
_________________________________________________________________
FORM 10-K
_________________________________________________________________
A COPY OF THE COMPANY'S FORM 10-K FOR THE FISCAL YEAR ENDED
JUNE 30, 1996 AS FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION WILL BE FURNISHED WITHOUT CHARGE TO STOCKHOLDERS AS OF
THE RECORD DATE UPON WRITTEN REQUEST TO THE SECRETARY, FRANKFORT
FIRST BANCORP, INC., 216 W. MAIN STREET, FRANKFORT, KENTUCKY
40602.
_________________________________________________________________
15<PAGE>
<PAGE>
REVOCABLE PROXY
FRANKFORT FIRST BANCORP, INC.
FRANKFORT, KENTUCKY
_________________________________________________________________
ANNUAL MEETING OF STOCKHOLDERS
NOVEMBER 12, 1996
_________________________________________________________________
The undersigned hereby appoints Charles A. Cotton III, Frank
McGrath and William M. Johnson, with full powers of substitution,
to act as proxies for the undersigned, to vote all shares of
common stock of Frankfort First Bancorp, Inc. (the "Company")
which the undersigned is entitled to vote at the Annual Meeting
of Stockholders (the "Meeting"), to be held at the main office of
First Federal Savings Bank of Frankfort, 216 West Main Street,
Frankfort, Kentucky, on Tuesday, November 12, 1996 at 4:30 p.m.,
local time, and at any and all adjournments thereof, as follows:
VOTE
FOR WITHHELD
--- --------
I. The election as directors of all
nominees listed below (except as
marked to the contrary below). [ ] [ ]
David G. Eddins
William C. Jennings
C. Michael Davenport
INSTRUCTION: TO WITHHOLD YOUR VOTE
FOR ANY INDIVIDUAL NOMINEE, INSERT THAT
NOMINEE'S NAME ON THE LINE PROVIDED BELOW.
__________________________________________
The Board of Directors recommends a vote "FOR" the nominees.
_________________________________________________________________
THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE
SPECIFIED, THIS PROXY WILL BE VOTED FOR EACH OF THE NOMINEES FOR
DIRECTOR LISTED ABOVE. IF ANY OTHER BUSINESS IS PRESENTED AT THE
MEETING, THIS PROXY WILL BE VOTED BY THOSE NAMED IN THIS PROXY IN
ACCORDANCE WITH THE DETERMINATION OF THE BOARD OF DIRECTORS. AT
THE PRESENT TIME, THE BOARD OF DIRECTORS KNOWS OF NO OTHER
BUSINESS TO BE PRESENTED AT THE MEETING. THIS PROXY CONFERS
DISCRETIONARY AUTHORITY ON THE HOLDERS THEREOF TO VOTE WITH
RESPECT TO THE ELECTION OF ANY PERSON AS DIRECTOR WHERE THE
NOMINEE IS UNABLE TO SERVE OR FOR GOOD CAUSE WILL NOT SERVE AND
MATTERS INCIDENT TO THE CONDUCT OF THE MEETING.
_________________________________________________________________<PAGE>
<PAGE>
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
Should the undersigned be present and elect to vote at the
Meeting or at any adjournment thereof and after notification to
the Secretary of the Company at the Meeting of the stockholder's
decision to terminate this proxy, then the power of said
attorneys and proxies shall be deemed terminated and of no
further force and effect.
The undersigned acknowledges receipt from the Company prior
to the execution of this proxy of a Notice of Annual Meeting of
Stockholders, a proxy statement dated October 10, 1996 and an
annual report.
Dated: _______________________, 1996
__________________________ __________________________
PRINT NAME OF STOCKHOLDER PRINT NAME OF STOCKHOLDER
__________________________ __________________________
SIGNATURE OF STOCKHOLDER SIGNATURE OF STOCKHOLDER
Please sign exactly as your name appears above. When signing as
attorney, executor, administrator, trustee or guardian, please
give your full title. If shares are held jointly, each holder
should sign.
_________________________________________________________________
PLEASE COMPLETE, DATE, SIGN AND MAIL THIS PROXY PROMPTLY IN THE
ENCLOSED POSTAGE-PREPAID ENVELOPE.
_________________________________________________________________
