This excerpt taken from the KFFB DEF 14A filed Oct 12, 2007.
Setting Executive Compensation for fiscal 2008
In establishing the fiscal 2008 compensation for the executive officers, the Compensation Committee considered the current salary, stock-based benefits, and other benefits that each employee would receive. It was noted that all three Named Executive Officers participated in the Companys restricted stock plan and stock option plan and would continue to vest in those awards during the upcoming fiscal year. All other plans and benefits are scheduled to remain in place as well.
The general recommendation of the Chairman and CEO and the other Named Executive Officers was that no changes be made in the current compensation packages, with one exception. The cash salary would remain the same and the officers would continue to participate in the benefit plans in which they have participated in the past. This decision was not a reflection of the performance of the Executive Officers. Generally, the committee believes that the Companys recent performance has been the result of market conditions beyond the control of the officers. In an effort to partially offset the influence of market factors, the Company has made a concerted effort to control non-interest costs. To wit, the officers recommended, and the committee agreed, that it was inappropriate to increase base compensation at this time.
It was noted that Vice President and CFO Clay Hulette has been receiving a cash benefit to compensate for a stock-based benefit plan that was foregone as the result of the acquisition of Frankfort First Bancorp, Inc. by Kentucky First Federal Bancorp in 2005. That benefit of $10,660 per year would have been exhausted in December, 2007. However, the Committee determined that it was appropriate to increase Mr. Hulettes base salary by a commensurate amount effective January 1 of 2008.