Edgar Filing: FIRST NATIONAL COMMUNITY BANCORP INC

FIRST NATIONAL COMMUNITY BANCORP, INC.
PROXY
FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD
MAY 15, 2002

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
OF FIRST NATIONAL COMMUNITY BANCORP, INC.

The undersigned hereby appoints Frank Caputo and Paul Latzanich, and each
or any of them, proxies of the undersigned with full power of substitution to
vote all of the shares of First National Community Bancorp, Inc. that the
undersigned may be entitled to vote at First National Community Bancorp, Inc.'s
Annual Meeting of Shareholders, to be held at the company's Exeter Office, 1625
Wyoming Avenue, Exeter, Pennsylvania 18643, on Wednesday, May 15, 2002, at 9:00
a.m., prevailing time, and at any adjournment or postponement of the meeting as
follows:

1. ELECTION OF DIRECTORS: To elect four Class A Directors to serve for a three
year term and until their successors are elected and qualified.

NOMINEES:

Michael J. Cestone, Jr.

Joseph J. Gentile

Joseph O. Haggerty

Louis A. DeNaples

_________ FOR all nominees (except as indicated to the contrary below)

INSTRUCTION: To withhold authority to vote for any individual
nominee, write that nominee's name in the following space.

________________________________________________________________

_________AGAINST all nominees

THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THESE NOMINEES.

2. In their discretion, the proxies are authorized to vote upon such other
business properly presented at the annual meeting and any adjournment or
other postponement of the meeting.

THIS PROXY, WHEN PROPERLY SIGNED AND DATED, WILL BE VOTED IN THE MANNER DIRECTED
BY THE UNDERSIGNED SHAREHOLDERS. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED FOR ALL NOMINEES LISTED ABOVE.

Dated: ______________________2002

Signed:__________________________

__________________________

THIS PROXY MUST BE DATED, SIGNED BY THE SHAREHOLDER(S) AND RETURNED PROMPTLY TO
REGISTRAR AND TRANSFER COMPANY IN THE ENCLOSED ENVELOPE. WHEN SIGNING AS
ATTORNEY, EXECUTOR, ADMINISTRATOR, TRUSTEE OR GUARDIAN, PLEASE GIVE FULL TITLE.
IF MORE THAN ONE TRUSTEE, ALL SHOULD SIGN. IF STOCK IS HELD JOINTLY, EACH OWNER
SHOULD SIGN.

I (We) do _____ do not _____ expect to attend the annual meeting.

FIRST NATIONAL COMMUNITY BANCORP, INC.
102 East Drinker Street
Dunmore, Pennsylvania 18512

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

Notice is hereby given that, pursuant to its Bylaws and the call of its
Board of Directors, the 2002 Annual Meeting of Shareholders of First National
Community Bancorp, Inc. will be held at the company's Exeter Office, 1625
Wyoming Avenue, Exeter, Pennsylvania 18643, on Wednesday, May 15, 2002 at 9:00
a.m., prevailing time, to consider and vote upon the following matters:

1. To elect four Class A Directors to serve for a three-year term and until
their successors are elected and qualified;

2. To transact any other business properly presented at the annual meeting and
any adjournment or postponement of the meeting.

The Board of Directors fixed March 31, 2002, as the record date for
determining shareholders entitled to notice of and to vote at the meeting.

Please refer to the attached proxy statement and the 2001 Annual Report to
Shareholders. You may obtain a copy of the annual report to shareholders on Form
10-K including the financial statements and exhibits for the 2001 fiscal year at
no cost by contacting William S. Lance, Treasurer, 102 East Drinker Street,
Dunmore, Pennsylvania 18512. Copies of the company's first quarter 2002
financial information, as required to be filed on Form 10-Q, will also be
available from William S. Lance on or after May 15, 2002.

PLEASE MARK, SIGN AND RETURN YOUR PROXY PROMPTLY IN THE ENCLOSED SELF-ADDRESSED,
STAMPED ENVELOPE, WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING IN PERSON. IF
YOU DO ATTEND THE MEETING, YOU MAY VOTE YOUR SHARES IN PERSON.

By Order of the Board of Directors,

J. David Lombardi, President and Chief Executive Officer

Dunmore, Pennsylvania
April 15, 2002

FIRST NATIONAL COMMUNITY BANCORP, INC.
102 EAST DRINKER STREET
DUNMORE, PENNSYLVANIA 18512

OTC BB TRADING SYMBOL: FNCB

PROXY STATEMENT
FOR THE
2002 ANNUAL MEETING OF SHAREHOLDERS

Mailed to Shareholders on or about April 15, 2002

PROXY STATEMENT
TABLE OF CONTENTS
PAGE
Frequently Asked Questions and Answers I

General Information 1
Date, Time and Place of Meeting 1
Voting Procedures 3

Principal Beneficial Owners Of The Company's Common Stock 4

Principal Owners 4
Beneficial Ownership by Directors, Principal Officers and Nominees 5

PROPOSAL 1. Election Of Directors 6

Information as to Nominees, Directors and Executive Officers 7
The Boards of Directors 9

Audit Committee 9

Report of the Audit Committee 10

Executive Compensation 11

Summary Compensation Table 11
Option Grants 13
Compensation of Directors 14
Employment Agreement 15
Profit Sharing Plan 16
Compensation Report of the Board of Directors 17
Board of Director Interlocks and Insider Participation 19

Stock Performance Graph And Table 20
Certain Relationships And Related Transactions 22
Principal Officers of the Company 22
Principal Officers of the Bank 23
Independent Auditors 24
Legal Proceedings 24
Shareholder Proposals 25
Other Matters 25
Additional Information 25

FREQUENTLY ASKED QUESTIONS AND ANSWERS

Q: WHO IS ENTITLED TO VOTE?

A: Shareholders as of March 31, 2002 (the record date). Each share of common
stock is entitled to one vote.

Q: HOW DO I VOTE?

A: There are two methods. You may vote by completing and mailing your proxy or
by attending the annual meeting and voting in person. (See page 3 of the
proxy statement for more details).

Q: HOW DOES DISCRETIONARY AUTHORITY APPLY?

A: If you sign your proxy but do not make any selections, you give authority to
Frank Caputo and Paul Latzanich, as proxy holders, to vote on the proposal
and any other matters that may arise at the meeting.

Q: IS MY VOTE CONFIDENTIAL?

A: Yes. Only the Judge of Election and the proxy holders will have access to
your proxy. All comments will remain confidential unless you ask that your
name be disclosed.

Q: WHO WILL COUNT THE VOTES?

A: Leonard A. Verrastro will tabulate the votes and act as Judge of Election.

Q: WHAT DOES IT MEAN IF I RECEIVE MORE THAN ONE PROXY?

A: Your shares are probably registered differently or are in more than one
account.Sign and return all proxies to ensure that all your shares are voted.

Q: WHAT CONSTITUTES A QUORUM?

A: As of March 31, 2002, 2,566,786 shares of common stock were issued and
outstanding. A majority of the outstanding shares, present or represented
by proxy, constitutes a quorum. If you vote by proxy or in person, you
will be considered part of the quorum.

Q: WHAT PERCENTAGE OF STOCK DO THE DIRECTORS AND OFFICERS OWN?

A: Approximately 28% of our common stock as of March 31, 2002. (See page 5 of
the proxy statement for more details).

Q: WHAT ARE THE SOLICITATION EXPENSES?

A: First National Community Bancorp, Inc., has retained Registrar and Transfer
Company of Cranford, New Jersey as its transfer agent. In its capacity
as transfer agent, Registrar and Transfer Company will assist in the
distribution of proxy materials and solicitation of votes for a stated
fee of $300 plus out-of-pocket expenses.

Q: WHO ARE THE LARGEST PRINCIPAL SHAREHOLDERS?

A: Louis A. DeNaples, as of March 31, 2002
Dominick L. DeNaples, as of March 31, 2002
(See page 4 of the proxy statement for more details).

Q: WHEN ARE THE 2003 SHAREHOLDER PROPOSALS DUE?

A: As a shareholder, you must submit your proposal in writing by January 16,
2003, to Michael J. Cestone, Jr., Secretary, First National Community
Bancorp, Inc. at 102 East Drinker Street, Dunmore, PA 18512. (See page 6
with regard to director nomination procedures).

PROXY STATEMENT
FOR THE ANNUAL MEETING OF SHAREHOLDERS OF
FIRST NATIONAL COMMUNITY BANCORP, INC.
TO BE HELD ON MAY 15, 2002

GENERAL INFORMATION

Date, Time and Place of Annual Meeting

This proxy statement is being furnished for the solicitation by the Board
of Directors of First National Community Bancorp, Inc., a Pennsylvania business
corporation and registered financial holding company, of proxies to be voted at
the company's Annual Meeting of Shareholders. The annual meeting will be held at
the company's Exeter Office, 1625 Wyoming Avenue, Exeter, Pennsylvania 18643 on
Wednesday, May 15, 2002, at 9:00 a.m., prevailing time. All inquiries regarding
the annual meeting should be directed to William S. Lance, Treasurer. This proxy
statement and the enclosed form of proxy are first being sent to shareholders of
the company on or about April 15, 2002.

Purpose of the Annual Meeting

At the annual meeting, shareholders will be requested:

o to elect four Class A Directors to serve for a three-year term and until
their successors are duly elected and qualified;

o to transact any other business as may properly come before the annual
meeting and any adjournment or postponement of the meeting.

We have not authorized anyone to provide you with information about the
company; therefore, you should rely only on the information contained in this
document or on documents to which we refer you. Although we believe we have
provided you with all the information helpful to you in your decision to vote,
events may occur at First National Community Bancorp, Inc. subsequent to
printing this proxy statement that might affect your decision or the value of
your stock.

Record Date, Quorum, Voting Rights

The company's Board of Directors fixed March 31, 2002 as the record date
for the determination of shareholders entitled to notice of and to vote at the
annual meeting. On the record date, the company had 2,566,786 outstanding shares
of common stock, par value $1.25 per share, the only authorized class of stock,
which was held by approximately 1,000 shareholders.
1

Under Pennsylvania law and the company's By-laws, the presence of a quorum,
in person or by proxy, is required for each matter to be acted upon at the
annual meeting. The presence of a quorum, in person or by proxy, of shareholders
entitled to cast at least a majority of the votes which all shareholders are
entitled to cast, constitutes a quorum for the transaction of business at the
annual meeting. Votes withheld and abstentions will be counted in determining
the presence of a quorum. Broker non-votes will not be counted in determining
the presence of a quorum for the particular matter as to which the broker
withheld authority.

Each holder of common stock is entitled to one vote, in person or by proxy,
for each share of common stock held in his or her name in the company's books as
of the record date. Assuming the presence of a quorum, the four nominees for
director receiving the highest number of votes will be elected.

Solicitation of Proxies

The cost of preparing, assembling, printing, mailing and soliciting
proxies, and any additional material that the company sends to its shareholders
in connection with the annual meeting, will be paid by the company. In addition
to solicitation by mail, directors, officers and employees of the company and
First National Community Bank may solicit proxies from shareholders personally
or by telephone, telegram, facsimile or other similar means without additional
compensation. Arrangements will be made with brokerage firms and other
custodians, nominees and fiduciaries to forward proxy solicitation materials to
the beneficial owners of the common stock held of record by these persons, and
upon their request, the company will reimburse them for their reasonable
forwarding expenses.

If your shares are registered directly in your name with First National
Community Bancorp, Inc.'s transfer agent, Registrar and Transfer Company, you
are considered, with respect to those shares, the shareholder of record, and
these proxy materials are being sent directly to you by the company. As the
shareholder of record, you have the right to grant your voting proxy directly to
the proxy holders or to vote in person at the meeting. The company has enclosed
a proxy card for your use.

If your shares are held in a stock brokerage account or by a bank or other
nominee, you are considered the "beneficial owner" of the shares held in street
name, and these proxy materials are being forwarded to you by your broker or
nominee which is considered, with respect to those shares, the shareholder of
record. As the beneficial owner, you have the right to direct your broker how to
vote and are also invited to attend the meeting. However, because you are not
the shareholder of record, you may not vote these shares in person at the
meeting. Your broker or nominee has enclosed a voting instruction card for you
to use in directing the broker or nominee how to vote your shares.

Voting and Revocation of Proxies

Shares represented by proxies properly signed, executed and returned,
unless subsequently revoked, will be voted at the annual meeting in accordance
with the instructions made by the shareholders. If a proxy is signed, executed
and returned without indicating any voting instructions, the shares represented
by the proxy will be voted FOR the election of all nominees. Execution and
return of the enclosed proxy will not affect your right to attend the annual
meeting and vote in person, after giving notice to Michael J. Cestone, Jr.,
Secretary of the company.

A shareholder of the company who returns a proxy may revoke the proxy prior
to the time it is voted in any one of the following ways:

o by giving written notice of revocation to Michael J. Cestone, Jr.,
Secretary of First National Community Bancorp, Inc., 102 East Drinker
Street, Dunmore, Pennsylvania 18512-2491; or

o by executing a later-dated proxy and giving written notice to the Secretary
of the company; or

o by voting in person after giving written notice to the Secretary of the
company.

Attendance by a shareholder at the annual meeting will not itself
constitute a revocation of the proxy.

You have the right to vote and, if desired, to revoke your proxy any time
before the annual meeting. Should you have any questions, please contact William
S. Lance, Treasurer at (570) 346-7667.

PRINCIPAL BENEFICIAL OWNERS OF THE COMPANY'S COMMON STOCK

Principal Owners

The following table sets forth, as of March 31, 2002, the name and address
of each person who owns of record or who is known by the Board of Directors to
be the beneficial owner of more than 5% of the company's outstanding common
stock, the number of shares beneficially owned by such person and the percentage
of the company's outstanding common stock so owned. The footnote to the
following table is set forth on page 5 under the section entitled "Beneficial
Ownership by Directors, Principal Officers and Nominees."

Percent of Outstanding
Common Stock
Name and Address Shares Beneficially Owned (1) Beneficially Owned

Louis A. DeNaples 233,343 9.09%
400 Mill Street
Dunmore, PA 18512

Dominick L. DeNaples 201,701 7.60%
400 Mill Street
Dunmore, PA 18512

Beneficial Ownership by Directors, Principal Officers and Nominees

The following table sets forth, as of March 31, 2002, the amount and
percentage of the company's common stock beneficially owned by each director,
each nominee for director and all principal officers, directors and nominees of
the company as a group. This information has been furnished by the reporting
persons.
Name of Individual Amount and Nature of Percent
or Identity of Group Beneficial Ownership (1) of Class (2)
-------------------------- ------------------------- -------------
Michael G. Cestone (3) 15,992 .60%
Michael J. Cestone, Jr. (4) 40,392 1.52%
Joseph Coccia (5) 22,392 .84%
William P. Conaboy (6) 6,257 .24%
Dominick L. DeNaples (7) 201,701 7.60%
Louis A. DeNaples (8) 233,343 9.09%
Joseph J. Gentile (9) 108,590 4.09%
Joseph O. Haggerty (10) 8,222 .31%
William S. Lance (11) 4,912 .19%
J. David Lombardi (12) 34,831 1.31%
John P. Moses (13) 7,357 .28%
John R. Thomas (14) 40,944 1.54%

All Directors and Principal Officers
as a Group (12 persons) 724,933 27.61%

As used throughout the proxy statement, the term "Principal Officers" refers to
the company's Executive Officers including the President and Treasurer.

(1) The securities "beneficially owned" by an individual are determined in
accordance with the definitions of "beneficial ownership" set forth in the
regulations of the Securities and Exchange Commission and may include
securities owned by or for the individual's spouse and minor children and
any other relative who has the same home, as well as securities that the
individual has or shares voting or investment power or has the right to
acquire beneficial ownership within sixty (60) days after March 31, 2002
through the exercise of stock options. Beneficial ownership may be
disclaimed as to certain of the securities. Unless otherwise indicated, all
shares are beneficially owned by the reporting person individually or
jointly with his spouse. All numbers here have been rounded to the nearest
whole number.

(2) Percentages assume that all options exercisable within sixty days of March
31, 2002 (the record date) have been exercised. Therefore, on a pro forma
basis, 2,652,686 shares would be outstanding.

(3) Includes 4,000 exercisable stock options, 906 shares held in street name
and 200 shares held jointly with his children.

(4) Includes 21,566 shares held in street name, 8,090 shares held individually
by his spouse and 4,000 exercisable stock options.

(5) Includes 4,000 exercisable stock options.

(6) Includes 4,000 exercisable stock options and 1,676 shares held in street
name.

(7) Includes 25,133 shares held jointly with his children and 4,000 exercisable
stock options.

(8) Includes 10,167 shares held jointly with his children and 2,302 shares held
individually by his spouse.

(9) Includes 38,523 shares held in street name, 22,073 shares held individually
by his spouse and 4,000 exercisable stock options.

(10) Includes 4,000 exercisable stock options.

(11) Includes 3,900 exercisable stock options.

(12) Includes 29,565 shares held in street name, 5,000 exercisable stock options
and 106 shares held individually by his spouse.

(13) Includes 4,956 shares held in street name and 2,000 exercisable stock
options.

(14) Includes 5,865 shares held individually by his spouse and 4,000 exercisable
stock options.
5

PROPOSAL 1:
ELECTION OF DIRECTORS

In accordance with Sections 9.2 and 9.3 of the company's By Laws, the
company has a classified Board of Directors with staggered three-year terms of
office. In a classified board, the directors are generally divided into separate
classes of equal number. The terms of the separate classes expire in successive
years. The company's Board of Directors is classified into three classes - Class
A, Class B, and Class C. Thus, at each annual meeting of shareholders,
successors to the class of directors whose term then expires are elected to hold
office for a term of three years. Therefore, the term of office of one class of
directors expires in each year. The Board of Directors is authorized to increase
the number of directors that constitutes the whole Board of Directors; provided
that the total number of directors in each class remains relatively
proportionate to the others.

Pursuant to Section 9.1 of the company's By-Laws, nominations for election
to the Board of Directors may be made by the Board of Directors or any
shareholder entitled to vote for the election of directors. Any shareholder who
intends to nominate a candidate for election to the Board of Directors (other
than a candidate proposed by the company's then existing Board of Directors)
must notify the company's Secretary in writing not less than 60 days prior to
the date of any shareholder meeting called for the election of directors. The
notification must contain the following information to the extent known by the
notifying shareholder:

a) the name and address of each proposed nominee;

b) the age of each proposed nominee;

c) the principal occupation of each proposed nominee;

d) the number of shares of the company's common stock owned by each proposed
nominee;

e) the total number of shares that, to the knowledge of the notifying
shareholder, will be voted for each proposed nominee;

f) the name and residential address of the notifying shareholder; and

g) the number of shares of the company's common stock owned by the notifying
shareholder.

Any nomination for director not made in accordance with Section 9.1 will be
disregarded by the presiding officer of the annual meeting, and votes cast for
each such nominee will be disregarded by the judges of election. In the event
that the same person is nominated by more than one shareholder, if at least one
nomination for such person complies with Section 9.1, the nomination will be
honored and all votes cast for the nominee will be counted.

Unless otherwise instructed, the proxy holders will vote the proxies
received for the election of the four nominees for Class A Director named below.
If any nominee should become unavailable to serve for any reason, proxies will
be voted in favor of a substitute nominee as designated by the Board of
Directors. The Board of Directors has no reason to believe that the nominees
named will be unable to serve, if elected. Any vacancy on the Board of
Directors, including vacancies resulting from an increase in the number of
directors, will be filled by a majority of the remaining members of the Board of
Directors and each person so appointed will be a director until the expiration
of the term of office of the class to which he or she was appointed. Election of
a director requires an affirmative vote of a majority of the shares of common
stock represented at the annual meeting.

Cumulative voting rights do not exist with respect to the election of
directors. Except as may otherwise be provided by statute or by the Articles of
Incorporation, at every shareholders meeting, each shareholder entitled to vote
has the right to one vote for each common share owned on the record date fixed
for the meeting. For example, if a shareholder owns 100 shares of common stock,
he or she may cast up to 100 votes for each of the nominees for director in the
class to be elected.

Information As To Nominees and Directors

The following table contains, as of March 31, 2002, certain information
with respect to the nominees and the directors whose terms of office expire in
2002, 2003 and 2004, respectively. You will find information about their share
ownership on page 5.

Age as of Principal Occupation Director Since
Name March 31, 2002 For Past Five Years Company/Bank
------------------ ---------------- ------------------------ ---------------

CLASS A DIRECTORS WHOSE TERM EXPIRES IN 2002 AND NOMINEES FOR CLASS A DIRECTORS
WHOSE TERM WILL EXPIRE IN 2005

Michael J. Cestone, Jr. (1) 70 President, M.R. Company 1998/1969
(Real Estate Corporation);
CEO, S.G. Mastriani Co.;
Secretary of the Board of the
Bank since 1971

Joseph J. Gentile 71 President, Dunmore Oil Co., Inc 1998/1989

Joseph O. Haggerty 62 Retired Superintendent, 1998/1987
Dunmore School District

Louis A. DeNaples (2) 61 President, DeNaples Auto 1998/1972
Parts, Inc.; President, Keystone
Landfill Inc.; Vice President
F&L Realty Corp; Chairman of the
Board of the Company since 1998

Age as of Principal Occupation Director Since
Name March 31, 2002 For Past Five Years Company/Bank
------------------- ---------------- ---------------------- ----------------

CLASS B DIRECTORS WHOSE TERM EXPIRES IN 2003

Michael G. Cestone (1) 39 President, S.G. Mastriani 1998/1988
Company (General Contractor)

J. David Lombardi 53 President and Chief Executive Officer 1998/1986
of the Company since 1998 and of the
Bank since 1988

John R. Thomas 84 Retired, Former Chairman of the Board,
Wesel Manufacturing Company 1998/1967

Age as of Principal Occupation Director Since
Name March 31, 2002 For Past Five Years Company/Bank
------------------- ---------------- ---------------------- ------------------

CLASS C DIRECTORS WHOSE TERM EXPIRES IN 2004

Joseph Coccia 47 President, Coccia Ford, Inc; 1998/1998
President, Coccia Lincoln
Mercury, Inc.

William P. Conaboy 43 Vice President, General Counsel, 1998/1998
Allied Services

Dominick L. DeNaples (2) 64 President, F&L Realty Corp.; 1998/1987
Vice President, DeNaples Auto
Parts Inc.; Vice President, Keystone
Landfill, Inc.

John P. Moses 55 Partner, Moses & Gelso, L.L.P. 1999/1999
(Attorneys at Law)

(1) Michael G. Cestone is the son of Michael J. Cestone, Jr.
(2) Messrs. Louis A. DeNaples and Dominick L. DeNaples are brothers.

The Boards Of Directors

During 2001, the company's Board of Directors held five meetings. Directors
received no remuneration for attendance at these meetings. Each of the directors
attended at least 75% of the meetings of the company's Board of Directors.

During 2001, First National Community Bank's Board of Directors held 23
meetings. Each of the directors attended at least 75% of the meetings of the
bank's Board of Directors with the exception of Mr. John R. Thomas.

The company's directors generally function as a full board. In lieu of a
nominating committee, the full board nominates the slate for the election of the
Board of Directors. In lieu of a compensation committee, the full board appoints
and sets compensation of officers and directors.

The bank maintains a Senior Loan Committee to meet on alternating weeks as
deemed necessary. Membership on this committee consists of the bank's Chairman
and President and Chief Executive Officer who are permanent members. Other
members of the Board of Directors are appointed on a rotating basis quarterly,
with no more than three members appointed from this group at any one time. In
2001, this committee held 17 meetings. Each appointed director was present for
more than 75% of the meetings for which they were scheduled.

Audit Committee

Information about the Company's Audit Committee and its Charter

The company maintains a standing audit committee. The company's Board of
Directors adopted a written charter for the Audit Committee. Each member of the
Audit Committee is independent, as that term is defined in the NASD listing
standards relating to audit committees.

Report of the Audit Committee

March 13, 2002

To the Shareholders of First National Community Bancorp:

We have reviewed and discussed with management the company's audited financial
statements as of and for the year ended December 31, 2001.

We have discussed with the independent auditors the matters required to be
discussed by the Statement on Auditing Standards No. 61, Communication with
Audit Committees, as amended, by the Auditing Standards Board of the American
Institute of Certified Public Accountants.

We have received and reviewed the written disclosures and the letter from the
independent auditors as required by Independence Standard No.1, Independence
Discussion with Audit Committee, as amended by the Independence Standards Board,
and have discussed with the auditors the auditors' independence.

Based on the reviews and discussions referred to above, we recommend to the
Board of Directors that the financial statements referred to above be included
in the company's Annual Report on Form 10-K for the year ended December 31, 2001
and filed with the Securities and Exchange Commission.

This report of the Audit Committee shall not be deemed to be "soliciting
material" or to be incorporated by reference by any general statement
incorporating by reference this proxy statement into any filing under the
Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as
amended, except to the extent that the company specifically incorporates this
information by reference, and shall not otherwise be deemed filed under such
Acts.

Audit Committee

Louis A. DeNaples, Committee Chairman Joseph J. Gentile

Joseph Coccia Joseph O. Haggerty

William P. Conaboy John P. Moses

Dominick L. DeNaples John R. Thomas

EXECUTIVE COMPENSATION

Shown below is information concerning the annual compensation for services
in all capacities to the company and the bank for the fiscal years ended
December 31, 2001, 2000, and 1999 of those persons who were, at December 31,
2001,

o the Chief Executive Officer

o the four other most highly compensated executive officers of the company,
to the extent such persons' total annual salary and bonus exceeded
$100,000.

Summary Compensation Table

Annual Compensation Long-Term Compensation
----------------------------------- --------------------------------------------
Awards Payouts
-------------------- ---------------------

Securities
Other Restricted Underlying All
Name and Annual Stock Option/ LTIP Other
Principal Salary Bonus Compensation Awards SARs Payouts Compensation
Position Year ($)(1) ($)(2) ($)(3) ($) (#)(4) ($) ($)(5)
---------------- -------- ---------- ---------- -------------- --------- ------------ -------- ----------------

J. David 2001 $199,000 $275,000 - - 5,000 - $29,820
Lombardi, 2000 199,000 275,000 - - 3,000 - 28,868
President and 1999 179,000 250,000 - - - - 25,604
Chief
Executive
Officer of the
Company and
the Bank

Thomas P. 2001 97,500 70,000 - - 4,000 - 16,064
Tulaney, 2000 94,500 60,000 - - 2,000 - 14,777
Executive Vice 1999 92,000 50,000 - - - - 14,164
President
of the Bank

Gerard A.
Champi, 2001 90,000 70,000 - - 4,000 - 15,297
Executive Vice 2000 87,000 60,000 - - 2,000 - 14,008
President 1999 84,500 50,000 - - - - 13,359
of the Bank

Stephen J. 2001 74,000 32,000 - - 4,000 - 9,771
Kavulich, 2000 71,500 30,000 - - 2,000 - 9,339
First Senior 1999 69,000 27,000 - - - - 9,228
Vice
President
of the Bank

William S. 2001 73,250 30,000 - - 3,900 - 9,536
Lance, 2000 70,750 27,000 - - 2,000 - 8,954
First Senior 1999 66,750 23,000 - - - - 8,557
Vice
President
of the Bank

(1) Includes directors' fees of $24,000 in each of 2001, 2000 and 1999, for Mr.
Lombardi.

(2) Cash bonuses are awarded at the conclusion of a fiscal year based upon the
Board of Directors' subjective assessment of the bank's performance as
compared to both budget and prior fiscal year performance, and the
individual contributions of the officers involved.

(3) The named executive officers did not receive perquisites or other personal
benefits during 2001 which, in the aggregate, exceeded $50,000 or 10% of
the named executive officers' salary and bonus earned during the year.
Perquisites and other personal benefits which were received by the named
executives were valued based on their cost to the bank.

(4) The amounts listed represent stock options granted to the persons listed in
the form of qualified incentive stock options which were granted at the
fair market value on the date of grant. As of March 31, 2002 (the record
date), all options are exercisable and expire ten years after the date on
which the award is granted.

(5) For Mr. Lombardi, includes $16,320, $16,368 and $16,096 contributed by the
bank pursuant to the Employees' Profit Sharing Plan for 2001, 2000 and
1999. Also included in Mr. Lombardi's total is a director's bonus of $8,500
in 2001 and $7,500 in each of 2000 and 1999 and premiums paid to purchase
additional life insurance in the amount of $5,000 in both 2001 and 2000 and
$2,008 in 1999. For Mr. Tulaney, Mr. Champi, Mr. Kavulich and Mr. Lance,
represents the amounts contributed by the bank to the Employees' Profit
Sharing Plan in the years shown.

Option Grants in 2001

The following table shows the stock options granted to the company's executive
officers in 2001, and their potential value at the end of the option's
term, assuming certain levels of appreciation of the company's common
stock.

OPTION/SAR GRANTS IN LAST FISCAL YEAR

Potential Realizable Value
At Assumed Annual Rate of
Stock Price Appreciation for
INDIVIDUAL GRANTS Option Term (1)
----------------------------------------------------------- ----------------------------
Number of Percent of
Securities Total Stock
Underlying Options/SARs
Options/SARs Granted to Exercise or
Granted Employees in Base Price Expiration
Name (#) (2) Fiscal Year ($/share) Date 5% ($) 10% ($)
--------------------------- -------------- -------------- ------------- ----------- ----------- ---------

J. David Lombardi 3,000 11.11% $33.55 8/22/11 $63,300 $160,410

Thomas P. Tulaney 2,000 7.41% $33.55 8/22/11 $42,200 $106,940

Gerard A. Champi 2,000 7.41% $33.55 8/22/11 $42,200 $106,940

Stephen J. Kavulich 2,000 7.41% $33.55 8/22/11 $42,200 $106,940

William S. Lance 2,000 7.41% $33.55 8/22/11 $42,200 $106,940

1) The dollar amounts under these columns are the result of calculations at
the 5% and the 10% annualized rates set by the Securities and Exchange
Commission and therefore are not intended to forecast possible future
appreciation, if any, of the company's common stock price.

2) All options outstanding become immediately exercisable in the event of a
change in control.

Stock Options and Stock Appreciation Rights Exercised in 2001
and Year-End Values

The following table reflects the number of stock options and stock
appreciation rights exercised by the Named Executive Officers in 2001, the total
gain realized upon exercise, the number of stock options held at the end of the
year, and the realizable gain of the stock options that are "in-the-money."
In-the-money stock options are stock options with exercise prices that are below
the year-end stock price because the stock value increased since the date of the
grant.

Aggregated Option/SAR Exercises in Last Fiscal Year
And Fiscal Year-End Option Values

Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options at Options at
Fiscal Year-End Fiscal Year-End (2)
-------------------------------- ------------------
Shares/SARs
Acquired
On Value Un-exercisable Un-exercisable
Name Exercise Realized Exercisable Exercisable
(#) ($)(1) (#) (#) ($) ($)
------------------------- -------------- ----------- ------------- -------------- ------------- --------------

J. David Lombardi 1,000 $4,850 2,000 3,000 $8,200 $0
Thomas P. Tulaney 0 0 2,000 2,000 $8,200 $0
Gerard A. Champi 0 0 2,000 2,000 $8,200 $0
Stephen J. Kavulich 0 0 2,000 2,000 $8,200 $0
William S. Lance 100 $ 470 1,900 2,000 $7,790 $0

(1) Based upon the difference between the closing price of the common stock
on the date or dates of exercise and the exercise price or prices for the stock
options or stock appreciation rights.

(2) Based upon the closing price of the common stock on December 31, 2001 of
$32.65 per share. As of December 31, 2001, no stock appreciation rights
were outstanding under the Stock Incentive Plan.

Compensation of Directors

During 2001, the company's Board of Directors held five meetings. Directors
received no remuneration for attendance at these board meetings. Members of the
bank's Board of Directors are compensated at the rate of $1,000 per board
meeting, including four compensated absences at full compensation, after which
members are not paid for any unexcused absence. Excused absences are limited to
non-attendance due to other bank business. The aggregate amount of fees paid in
2001 was $275,000. In 2001, Michael J. Cestone, Jr. and John R. Thomas were
compensated $14,000, in the aggregate, for special services (respectively
Secretary and Investment Advisor) rendered to the bank. All bank directors also
received a bonus of $8,500 in 2001. Members of the bank's Senior Loan Committee
do not receive a fee for attendance at Senior Loan Committee meetings. Members
of the Audit Committee of both the company and the bank do not receive
remuneration for attending Audit Committee meetings.

Employment Agreement

The bank entered into an employment agreement with Mr. J. David Lombardi,
President and Chief Executive Officer effective on January 1, 1990, and as
amended on September 28, 1994. On July 8, 1998 the company's Board of Directors
approved and adopted an amendment to the employment agreement which added the
company as a party to the agreement. This agreement is designed to assist the
company and the bank in retaining a highly qualified executive and to help
ensure that if the company is faced with an unsolicited tender offer proposal,
Mr. Lombardi will continue to manage the company without being unduly distracted
by the uncertainties of his personal affairs and thereby will be better able to
assist in evaluating such a proposal in an objective manner.

The agreement provides for a base annual salary of $195,000 in 2002.
Additional compensation by way of salary increases, bonuses or fringe benefits
may be established from time to time by appropriate board action. The agreement
does not preclude Mr. Lombardi from serving as a director of the company and the
bank or from receiving related fees.

The agreement may be terminated by the company with or without "just cause"
(as defined in the agreement), or upon death, permanent disability, or normal
retirement of Mr. Lombardi, or upon the termination of Mr. Lombardi's employment
by resignation or otherwise. In the event employment is terminated with "just
cause," Mr. Lombardi shall receive salary payments at his then effective base
salary, as if his employment had not been terminated, for a period of three
months, excluding bonuses or fringe or supplemental payments previously
authorized by the Board of Directors. In the event that the employment
termination is occasioned by the company without "just cause," Mr. Lombardi
shall continue to receive each month, for a period of two years from the
effective date of termination;

o his monthly base salary payments from the bank at the rate in effect on the
date of the termination

o his monthly Board of Directors fees

o one twelfth of the average of the bonuses paid to him over the preceding
three years, all computed as if his employment had not been terminated.

If a "change in control" (as defined in the agreement), occurs and as a
result thereof, Mr. Lombardi's employment is terminated or his duties or
authority are substantially diminished or he is removed from the office of Chief
Executive Officer of the reorganized employer, Mr. Lombardi may terminate his
employment by giving notice to the company within sixty days of the occurrence
of the "change in control." Upon such termination, the company is obligated to
pay Mr. Lombardi the total sum of the following:

o three times his then annual base salary which was in effect as of the date
of the change in control

o three times his then annual Board of Director's fee

o three times the average of his bonuses for the prior three years.

Subsequent to termination, Mr. Lombardi may not accept employment in any
office or branch of any financial institution or subsidiary in Lackawanna
County, Pennsylvania for a period of three years, unless such severance was made
by the company without "just cause".

Profit Sharing Plan

In 1969, the bank adopted a Profit Sharing Plan which was subsequently
amended to comply with the Employee Retirement Income Security Act of 1974 and
the Tax Equity and Fiscal Responsibility Act of 1982. Under the plan, any
employee who has attained the age of twenty-one is eligible to become a plan
participant on the earlier of the first day of the seventh month or the first
day of the plan year coinciding with or following the date on which he/she has
met the eligibility requirement. In no event shall participation commence later
than six months after the date an employee satisfies the service requirements.
The plan provides for progressive vesting of an employee's interest in the
amount accrued to his/her respective account calculated by the percentage
portion of the value of the account which is nonforfeitable based upon years of
service.

The vesting schedule is as follows:

Years of Service Nonforfeitable Percentage
------------------- --------------------------
less than 3 0%
3 but less than 4 20%
4 but less than 5 40%
5 but less than 6 60%
6 but less than 7 80%
7 years and at Normal Retirement 100%

Upon normal retirement, death prior to retirement, or permanent disability,
the employee is entitled to 100% of the amount credited to his/her account,
except that, in the event of voluntary termination or termination for cause
prior to the end of three years of continuous employment, the amount credited to
the employee's account is forfeited. The maximum amount of the bank's annual
contribution is 15% of the aggregate salaries of all participants under the
plan, or such other amount as determined by the bank's Board of Directors
considering net profits for the year. In no event may such contribution exceed
the amount deductible by the company for federal income tax purposes. During the
year ended December 31, 2001, the bank contributed $330,000 to this plan for all
participants. The following amounts were contributed on behalf of the
individuals named in the summary compensation table: Mr. Lombardi, $16,320, Mr.
Tulaney, $16,064, Mr. Champi, $15,297, Mr. Kavulich, $9,771 and Mr. Lance,
$9,536. Directors who are not also bank officers or employees are not eligible
to participate in this plan.

COMPENSATION REPORT OF THE BOARD OF DIRECTORS

The full board of directors advises our Chief Executive Officer on
compensation matters, determines the compensation of the Chief Executive
Officer, reviews and takes action on the recommendation of the Chief Executive
Officer as to the appropriate compensation of other officers and key personnel
and approves the grants of bonuses to officers and key personnel. The Stock
Option Administration Committee is responsible for the administration of the
company's Stock Incentive Plan and the Independent Directors Stock Option Plan.

This report of the board of directors shall not be deemed incorporated by
reference by any general statement incorporating by reference this proxy
statement into any filing under the Securities Act of 1933, as amended, or the
Securities Exchange Act of 1934, as amended, except to the extent that we
specifically incorporate this information by reference, and shall not otherwise
be deemed filed under such Acts.

CHIEF EXECUTIVE OFFICER COMPENSATION

Compensation for Mr. Lombardi's services as President and Chief Executive
Officer is paid under the terms of an employment agreement between the company
and Mr. Lombardi. The terms of the Employment Agreement are described under
"Employment Agreements". In addition to his base salary, Mr. Lombardi received a
$275,000 bonus in 2001. The Board of Directors considers the amounts paid to Mr.
Lombardi for his services to the company to be reasonable in light of the
responsibilities assumed by Mr. Lombardi during 2001. Mr. Lombardi does not
participate in the Board's determination of his own compensation.

COMPENSATION POLICY FOR EXECUTIVE OFFICERS OTHER THAN
THE CHIEF EXECUTIVE OFFICER

The Board of Director's fundamental policy is to provide our executive
officers with competitive compensation opportunities based upon their
contribution to our development and financial success and their personal
performance. The Board's objective is to have a portion of each executive
officer's compensation contingent upon our performance was well as upon each
executive officer's own level of performance. Therefore, the compensation
package for each executive officer is comprised of three different elements:

o base salary which reflects individual performance and is designed primarily
to be competitive with salary levels in the industry;

o cash bonuses which reflect the achievement of performance objectives and
goals; and

o long-term stock-based incentive awards which strengthen the mutuality of
interest between the executive officers and our shareholders.

Factors. The principal factors that the Board of Directors considered with
respect to each executive officer's compensation for fiscal 2001 are summarized
below. The Board of Directors may, however, in its discretion, apply entirely
different factors for executive compensation in future years.

o Base Salary. The base salary for each executive officer was determined on
the basis of the following factors: experience, expected personal
performance, the salary levels in effect for comparable positions within
and without the industry, internal base salary comparability considerations
and the responsibilities assumed by the executive. The weight given to each
of these factors differed from individual to individual, as the Board of
Directors believed appropriate.

o Bonus. Bonus represents the variable component of the executive
compensation program that is tied to our performance and individual
achievement. Our policy is to base a significant portion of our executive
officer's cash compensation on bonus. In determining bonuses, the Board of
Directors considers factors such as relative performance of the company
during the year and the individual's contribution to our performance, the
need to attract, retain and motivate high quality executives as well as the
degree to which the executive officer met or exceeded certain objectives
established for him/her.

o Long-term Incentive Compensation. Long-term incentives are provided through
grants of stock options. The grants are designed to align the interests of
each executive officer with those of the shareholders and provide each
individual with a significant incentive to manage the company from the
perspective of an owner with an equity stake. Each option grant allows the
individual to acquire shares of our common stock at a fixed price per share
over a specified period of time up to ten years. The number of shares
subject to each option grant is set at a level intended to create
meaningful opportunity for appreciation based on the executive officer's
current position with the company, the size of comparable awards made to
individuals in similar positions within the industry and the individual's
personal performance in recent periods. However, the Board of Directors
does not adhere to any specific guidelines as to the granting of options to
our executive officers. Options to acquire an aggregate of 27,000 shares of
our common stock were granted to executive officers in fiscal 2001.

INTERNAL REVENUE CODE LIMITS ON THE DEDUCTIBILITY OF COMPENSATION

Section 162(m) of the Internal Revenue Code of 1986, as amended, generally
denies publicly-held corporations a federal income tax deduction for
compensation exceeding $1,000,000 paid to the Chief Executive Officer or any of
the four other highest paid executive officers, excluding performance-based
compensation. Through December 31, 2001, this provision has not limited our
ability to deduct executive compensation, but the Board of Directors will
continue to monitor the potential impact of Section 162(m) on our ability to
deduct executive compensation. The First National Community Bancorp, Inc. Stock
Incentive Plan has been designed, and, to the extent deemed advisable by the
Stock Option Administration Committee, will be administered in a manner that
will enable the company to deduct compensation attributable to options and
without regard to such deduction limitation.

We believe that our compensation philosophy of paying our executive
officers with competitive salaries, cash bonuses and long-term incentives, as
described in this report, serves the best interests of First National Community
Bancorp, Inc. and its shareholders.

BOARD OF DIRECTORS

Louis A. DeNaples, Chairman Joseph J. Gentile
Michael J. Cestone, Jr. Joseph O. Haggerty
Michael G. Cestone J. David Lombardi
Joseph Coccia John P. Moses
William P. Conaboy John R. Thomas
Dominick L. DeNaples

Board of Directors Interlocks and Insider Participation

J. David Lombardi, President and Chief Executive Officer of the company and
the bank, is a member of both Boards of Directors. Mr. Lombardi makes
recommendations to the Board of Directors regarding employee compensation. Mr.
Lombardi does not participate in conducting his own review. The entire Board of
Directors votes to establish and approve the company's compensation policies.

STOCK PERFORMANCE GRAPH AND TABLE

The following graph and table compare the cumulative total shareholder
return on the company's common stock during the period December 31, 1996,
through and including December 31, 2001, with

o the cumulative total return for all stocks traded on the S&P 500 index

o the cumulative total return on all bank stocks traded on the NASDAQ Stock
Market

o the cumulative total return on the SNL Securities Corporate Performance
Index for banks with assets between $500 million and $1 billion.

The comparison assumes $100 was invested on December 31, 1996, in the
company's common stock and in each of the stated indices and assumes further the
reinvestment of dividends into the applicable securities. The shareholder return
shown on the graph and table on page 21 is not necessarily indicative of future
performance.

First National Community Bancorp, Inc.

Total Return Performance
Period Ending
------------------------------------------------------------------------
INDEX 12/31/96 12/31/97 12/31/98 12/31/99 12/31/00 12/31/01
------------------------------------------ ----------- ------------ ----------- ----------- ----------- -----------

First National Community Bancorp, Inc. 100.00 127.47 232.69 274.52 227.24 257.26
S&P 500 100.00 133.37 171.44 207.52 188.62 166.22
NASDAQ Bank Index 100.00 167.41 166.33 159.89 182.38 197.44
SNL $500-$1B Bank Index* 100.00 162.56 159.83 147.95 141.62 183.73

(*) SNL Securities is a research and publishing firm specializing in the
collection and dissemination of data on the banking, thrift and financial
services industries.

Assumes a $100 investment on December 31, 1996 and reinvestment of all
dividends.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

There have been no material transactions between the company or the bank,
nor any material transactions proposed, with any director or executive officer
of the company or the bank, or any associate of the foregoing persons. The
company and the bank have engaged in and intend to continue to engage in banking
and financial transactions in the ordinary course of business with directors and
officers of the company and the bank and their associates on comparable terms
and with similar interest rates as those prevailing from time to time for other
bank customers. Total loans outstanding from the bank at December 31, 2001, to
the company's officers and directors as a group and members of their immediate
families and companies in which they had an ownership interest of 10% or more
were $13,516,000 or 26% of the bank's total equity capital. Loans to these
persons were made in the ordinary course of business, were made on substantially
the same terms, including interest rates and collateral, as those prevailing at
the time for comparable transactions with other persons, and did not involve
more than the normal risk of collectability or present other unfavorable
features. The aggregate amount of indebtedness outstanding as of the latest
practicable date, March 31, 2002, to the above described group was $17,945,000.

PRINCIPAL OFFICERS OF THE COMPANY

The following table sets forth, as of March 31, 2002, selected information
about the principal officers of the company, each of whom is elected by the
Board of Directors and each of whom holds office at the Board's discretion.
Number of
Office and Shares Age as of
Position with Beneficially March 31,
Name the Company Held Since Owned (1) 2002
----------------- ----------------- ------------ --------------- -------------

Louis A. DeNaples Chairman of 1998 233,343 61
the Board

J. David Lombardi President and 1998 34,831 53
Chief Executive
Officer

Michael J. Cestone, Jr. Secretary 1998 40,392 70

William S. Lance Treasurer 1998 4,912 42

(1) All shares are owned individually or jointly with a spouse unless otherwise
indicated. For additional details on the shares beneficially owned, see
"Beneficial Ownership by Directors, Principal Officers and Nominees" on
page 5.

PRINCIPAL OFFICERS OF THE BANK

The following table sets forth, as of March 31, 2002, selected information
about the principal officers of the bank, each of whom is elected by the Board
of Directors and each of whom holds office at the Board's discretion.
Number of
Office and Bank Shares Age as of
Position with Employee Beneficially March 31,
Name the Bank Held Since Since Owned (1) 2002
---------------------- -------------- --------------- ---------- ---------------- ---------

Louis A. DeNaples Chairman of 1988 (2) 233,343 61
(1) the Board

J. David Lombardi President and 1988 1981 34,831 53
(1) Chief Executive
Officer

Gerard A. Champi Executive 1998 1991 6,044 41
(3)(4) Vice President

Thomas P. Tulaney Executive 1998 1994 5,452 42
(5)(6) Vice President

Stephen J. Kavulich First Senior 1998 1991 11,232 56
(7)(8) Vice President

William S. Lance First Senior 1999 1991 4,912 42
(1)(9) Vice President

(2) Mr. Louis A. DeNaples is a non-employee member of the Board of Directors of
the Bank.

(3) Mr. Champi is the Retail Sales Division Manager.

(4) Includes 4,000 exercisable stock options, 1,782 shares held in street name
and 262 shares as custodian for his minor children.

(5) Mr. Tulaney is the Commercial Sales Division Manager.

(6) Includes 4,000 exercisable stock options and 1,210 shares held in street
name.

(7) Mr. Kavulich is the Loan Administration/Compliance Division Manager.

(8) Includes 4,000 exercisable stock options, 2,534 shares held individually by
his spouse and 2,024 shares held as custodian for his children.

(9) Mr. Lance is the Finance Control Division Manager.

INDEPENDENT AUDITORS

Demetrius & Company, L.L.C., Certified Public Accountants, of Wayne, New
Jersey, has been appointed as the company's independent auditor for the fiscal
year ending December 31, 2002. Services for 2002 will include an audit and
opinion on the company's consolidated financial statements as well as a review
of the schedules to be included in the company's Form 10-K filing with the
Securities and Exchange Commission. All professional services rendered by
Demetrius & Company will be furnished at customary rates and terms after Board
approval. Demetrius & Company served as the company's independent auditors for
the 2001 fiscal year.

Robert Rossi & Co., Olyphant, PA, has been retained as assistant auditor
and as such will perform all audit procedures necessary for the purpose of
assisting the lead auditor in their expression of an opinion on the company's
financial statements. In addition to performing customary audit services, Robert
Rossi & Co. will assist the company with the preparation of its federal and
state tax returns, and will provide assistance in connection with regulatory
matters, charging the company for such services at its customary hourly billing
rates. Robert Rossi & Co. was retained in the same capacity during 2001. These
non-audit services are approved by the company's and the bank's Boards of
Directors after the Boards review the nature and expense associated with such
services and their conclusion that there is no effect on the independence of the
accountants.

Aggregate fees billed to the corporation and the bank by Demetrius &
Company and Robert Rossi & Co., the independent accountants, for services
rendered during the year ended December 31, 2001, were as follows:

Audit Fees $38,200
Financial Information Systems $ 0
Design and Implementation Fees
All Other Fees $ 7,600

LEGAL PROCEEDINGS

The nature of the company's and the bank's business generates a certain
amount of litigation involving matters arising in the ordinary course of
business. However, in the opinion of management of the company and the bank,
there are no proceedings pending to which the company and the bank is a party or
to which their property is subject, which, if determined adversely to the
company and the bank, would be material in relation to the company's and the
bank's undivided profits or financial condition, nor are there any proceedings
pending other than ordinary routine litigation incident to the business of the
company and the bank. In addition, no material proceedings are pending or are
known to be threatened or contemplated against the company and the bank by
government authorities or others.

SHAREHOLDER PROPOSALS FOR 2003 ANNUAL MEETING

In order for a shareholder proposal to be considered for inclusion in First
National Community Bancorp, Inc.'s proxy statement for next year's annual
meeting, the written proposal must be received by the company no later than
January 16, 2003. Any proposal must comply with Securities and Exchange
Commission regulations regarding the inclusion of shareholder proposals in
company-sponsored proxy materials. If a shareholder proposal is submitted to the
company after January 16, 2003, it is considered untimely; and, although the
proposal may be considered at the annual meeting, the company is not obligated
to include it in the 2003 proxy statement. Similarly, in compliance with the
company's Bylaws, shareholders wishing to nominate a candidate for election to
the Board of Directors, must notify the Secretary in writing not less than 60
days prior to the date of the meeting. Shareholders must deliver any proposals
or nominations in writing to the Secretary of First National Community Bancorp,
Inc. at its principal executive office, 102 E. Drinker Street, Dunmore,
Pennsylvania 18512. See page 6 for more information about nominations to the
Board of Directors.

OTHER MATTERS

The Board of Directors knows of no other business which will be presented
for consideration at the meeting other than as stated in the Notice of Meeting.
However, if other matters properly come before the meeting, the matters will be
voted in accordance with the recommendations of the Board of Directors, and
authority to do so is included in the proxy.

ADDITIONAL INFORMATION

A copy of the company's annual report to shareholders for its fiscal year
ended December 31, 2001, was mailed on March 29, 2001. A representative of the
accounting firm which examined the financial statements contained in the annual
report will attend the annual meeting. This representative will have the
opportunity to make a statement, if he or she desires to do so, and will be
available to respond to any appropriate questions presented by shareholders at
the annual meeting.

In accordance with Securities Exchange Act Rule 14a-3(3)(1), in the future,
First National Community Bancorp, Inc. intends to deliver only one annual report
and proxy statement to multiple shareholders sharing an address unless we
receive contrary instructions from one or more of the shareholders. This method
of delivery is known as "householding". Upon written or oral request, the
company will promptly deliver a separate copy of the annual report or proxy
statement, as applicable, to a shareholder at a shared address to which a single
copy of the documents was delivered. Further, shareholders can notify the
company by writing or calling William S. Lance, Treasurer of First National
Community Bancorp, Inc. at 102 E. Drinker Street, Dunmore, PA 18512 or (570)
346-7667 and inform us that the shareholder wishes to receive a separate copy of
an annual report or proxy statement in the future. In addition, if you are
receiving multiple copies of the company's annual report or proxy statement, you
may request that we deliver only a single copy of annual reports or proxy
statements by notifying us at the above address or telephone number.