UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
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 ss. 240.14a-11(c) or ss. 240.14a-12
United Bancshares, Inc.
(Name of Registrant as Specified In Its Charter)
Tucci & Tannenbaum, A Professional Corporation
300 North Third Street
Philadelphia, PA 19106
(215)923-6200
-----------------------------------
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
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(1) Title of each class of securities to which transaction applies:
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[ ] Check box if any part of the fee is offset as provided by Exchange Act
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<PAGE>
URGENT
IMMEDIATE RESPONSE REQUESTED
May 31, 2000
Dear Shareholder:
On behalf of the Board of Directors and management, I am pleased to invite you
to the 2000 Annual Meeting of Shareholders of United Bancshares, Inc. which is
to be held on Friday, June 30, 2000, at 1:00 p.m. at the Federal Reserve Bank of
Philadelphia, 100 North 6th Street, Philadelphia, PA. Accompanying this letter
are a Notice of Meeting, a Proxy Statement and a proxy form admission ticket.
I URGE YOU TO READ THE ENCLOSED MATERIAL CAREFULLY AND TO COMPLETE, SIGN AND
MAIL PROMPTLY THE PROXY FORM CONTAINED WITH THIS LETTER SO THAT YOUR VOTE WILL
BE COUNTED. A SELF-ADDRESSED STAMPED ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE.
The officers, directors and staff of United Bank sincerely appreciate your
continuing support.
Sincerely,
Evelyn Smalls, President
<PAGE>
UNITED BANCSHARES, INC.
300 NORTH THIRD STREET
PHILADELPHIA, PA 19106
--------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON JUNE 30, 2000
--------------
Dear Shareholders,
The Annual Meeting of the Shareholders of United Bancshares, Inc. ("UBS")
will be held at 1:00 p.m., local time, on Friday, June 30, 2000 at the Federal
Reserve Bank of Philadelphia, 10 Independence Place, Philadelphia, Pennsylvania
19106, for the following purposes:
1. To re-elect three Class A directors to serve until the expiration
of their four year term.
2. To ratify the appointment of Grant Thornton LLP as independent
auditors for the 1999 fiscal year.
3. To authorize additional shares of non-voting, Class B Common Stock.
4. To transact such other business as may properly come before the
Annual Meeting and any adjournment thereof.
By Order of the Board of Directors
WILLIAM B. MOORE,
Secretary
May 31, 2000
<PAGE>
ANNUAL MEETING OF SHAREHOLDERS
JUNE 30, 2000
PROXY STATEMENT
The enclosed proxy is solicited by and on behalf of the Board of Directors
of United Bancshares, Inc. ("UBS"). All costs of solicitation, (including
printing and mailing of this Proxy Statement, meeting notice and form of proxy,
as well as any necessary supplementary solicitations) will be paid by UBS. In
addition to the solicitation of proxies by mail, officers and employees of UBS
may solicit in person or by telephone. Persons holding shares as nominees will,
upon request, be reimbursed for their reasonable expenses in sending soliciting
materials to their principals.
All shareholders of UBS Common Stock of record as of the end of business on
May 15, 2000, are entitled to vote at the meeting or any adjourned session. Each
share is entitled to one vote. As of the date upon which the enclosed proxy was
mailed, there were issued and outstanding approximately 1,028,793 shares of UBS
Common Stock. This Proxy Statement was mailed to the shareholders of UBS on or
about May 31, 2000.
At the Annual Meeting, the shareholders of UBS are being asked to consider
and vote upon (i) the election of three Class A Directors to serve for a term of
four years and until their successors are elected and qualified, (ii) the
ratification of independent auditors for UBS; and (iii) the amendment of the
Articles of Incorporation to authorize 500,000 additional shares of Class B,
non-voting, common stock.
Shares represented by a properly executed proxy will be voted in accordance
with the instructions thereon, or if no specification is made, the persons named
as proxies will vote for management's slate of Directors, and all proposals as
recommended by the Board of Directors. Proxies may be revoked at any time before
they are exercised by the subsequent execution and submission of a revised
proxy, by written notice to the Secretary of UBS, or by voting in person at the
meeting. The mailing address of UBS is 300 North Third Street, Philadelphia,
Pennsylvania 19106.
SHAREHOLDERS WHO NEED DIRECTIONS TO THE LOCATION OF THE ANNUAL MEETING
SHOULD CALL 215-829-2265 BETWEEN THE HOURS OF 8:30 A.M. AND 4:30 P.M., LOCAL
TIME, ON ANY BUSINESS DAY.
A copy of UBS's Annual Report for the year ended December 31, 1999,
including financial statements, is being distributed to each shareholder with
this Proxy Statement.
1. ELECTION OF DIRECTORS.
The Board of Directors of UBS has nominated the three persons listed below
for election as Class A directors, each to hold office until the expiration of
their four year term and until his or her successor is elected and qualified:
<TABLE>
<CAPTION>
YEAR FIRST TERM
PRINCIPAL BECAME WILL
NAME AGE OCCUPATION DIRECTOR EXPIRE
---- --- ---------- -------- ------
<S> <C> <C> <C> <C>
L. Armstead
Edwards ... 57 Co-Chairman, 1993 2004
United Bancshares, Inc.
Owner and President,
P.A.Z., Inc.,
Philadelphia., PA
Marionette Y. 55 Partner, 1996 2004
Frazier ... John Frazier, Inc.
Philadelphia, PA
Ernest L.
Wright ... 71 Founder, President and 1993 2004
CEO of Ernest L. Wright
Construction Company
Phila., PA
</TABLE>
If any such nominee is not available for election at the time of the
meeting, the persons named as proxies will vote for such substitute nominee as
the Board of Directors may recommend unless the number of directors serving on
the Board is reduced. All nominees are currently Directors of UBS. Directors
Edwards and Wright have served as directors since UBS's inception.
On May 15, 2000, the nominees owned shares of UBS in the following amounts:
L. Armstead Edwards (10,833 shares); Marionette Y. Frazier (9,350 shares); and
Ernest L. Wright (5,000 shares). On May 15, 2000, all directors and officers of
UBS, as a group, owned approximately 7.33% of all of the outstanding voting
shares of UBS.
In addition to the nominees proposed above, the following persons will
serve as Directors of UBS during the ensuing year:
<PAGE>
<TABLE>
<CAPTION>
YEAR FIRST TERM
PRINCIPAL OCCUPATION BECAME WILL
NAME AGE AND OTHER DIRECTORSHIPS DIRECTOR EXPIRE
---- --- ----------------------- -------- ------
<S> <C> <C> <C>
James F. Bodine ... 78 Retired as Managing 1993 2002
Partner, Urban Affairs
Partnership Phila., PA.; Co-Chairman
United Bank and UBS
S. Amos Brackeen ... 81 Founder and Pastor, 1993 2003
Philippian Baptist
Church of Phila., PA.
Emma C. Chappell .. 59 Former Chairman of 1993 2003
the Board, President and CEO
of UBS and United Bank
of Philadelphia
Kemel G. Dawkins ... 76 President, Kemrodco 1993 2001
Development and
Construction Company, Inc.,
President, Kem-Her
Construction Company
Inc., Phila., PA.
William C. Green ... 75 Co-founder, Ivy Leaf 1993 2002
Middle School,
Philadelphia, PA
Angela M. Huggins ... 60 President and CEO 1993 2001
RMS Technologies
Inc. Foundation;
Treasurer - United Bank and
UBS
William B. Moore ... 57 Secretary, 1993 2003
United Bancshares, Inc.
Pastor, Tenth Memorial
Baptist Church,
Philadelphia, PA
</TABLE>
The proxy holders will have the right to vote for any or all of the named
nominees or their substitutes, as the proxy holders deem best. If any nominee
becomes unavailable for any reason, it is intended that the proxies will be
voted for a substitute nominee designated by the Board of Directors. The Board
of Directors has no reason to believe that any of the nominees will be unable to
serve if elected. Any vacancy occurring on the Board of Directors for any reason
may be filled by a majority of the Directors remaining in office, though less
than a quorum. Each Director so elected shall remain a Director until his or her
successor is elected by the shareholders at the annual meeting of the
shareholders at which members of the Directors' class are elected, or at any
special meeting prior thereto called for such purpose.
<PAGE>
BOARD MEETINGS AND COMMITTEES
The Board of Directors of UBS, during the year ended December 31, 1999,
held eleven meetings. The following Directors attended less than seventy-five
percent (75%) of the board meetings of UBS held: NONE.
The Board of UBS has a standing Human Resources Committee which is composed
of the following Directors, a majority of whom are not "interested persons" of
UBS:
S. Amos Brackeen
James F. Bodine
Kemel G. Dawkins
William C. Green
During the year ended December 31, 1999, the UBS Human Resources Committee held
two meetings. The Committee is responsible principally for: (1) evaluating the
performance of UBS's executive officers, and developing and approving the
executive compensation plan (including base salary, customary insurance and
other benefits, and incentives) for such officers; and (2) interviewing,
evaluating and recommending to shareholders candidates for election to UBS's
Board of Directors.
The Committee will consider Director nominations recommended by
shareholders. Such nominations can be made by submitting a written request for
consideration of a candidate, including a resume, to Reverend S. Amos Brackeen,
Chairman of the Human Resources Committee.
The Board of UBS also has a standing audit committee for the purpose of
interfacing with UBS's independent auditors and reviewing the internal controls
of UBS consisting of the following board members:
James F. Bodine
S. Amos Brackeen
Kemel G. Dawkins
L. Armstead Edwards
Marionette Y. Frazier
William C. Green
Angela M. Huggins
William B. Moore
Ernest L. Wright
PRINCIPAL EXECUTIVE OFFICERS
NAME AGE OFFICE
---- --- ------
Evelyn Smalls 54 President
L. Armstead Edwards 57 Co-Chairman
James F. Bodine 78 Co-Chairman
Reverend William B
Moore 57 Secretary
Angela M. Huggins 60 Treasurer
Until May, 2000, Dr. Emma C. Chappell served as President and Chairman of
UBS and the Bank.
REMUNERATION OF DIRECTORS AND
EXECUTIVE OFFICERS
COMPENSATION TABLE
<TABLE>
<CAPTION>
NAME OF INDIVIDUAL OR CAPACITIES IN
NUMBER IN GROUP WHICH SERVED 1999 SALARY 1999 CASH BONUS 1999 OPTIONS SERP
--------------- ------------ ----------- --------------- ------------ ----
<S> <C> <C> <C> <C> <C>
Emma C. Chappell Chairman, President $174,500 $11,183 0 $51,840
Chief Executive Officer
(through May, 2000)
1998 SALARY 1998 CASH BONUS 1998 OPTIONS SERP
----------- --------------- ------------ ----
$165,000 $18,000 29,694(1) $48,000
1997 SALARY 1997 CASH BONUS 1997 OPTIONS SERP
----------- --------------- ------------ ----
$162,000 $0 0 $48,000
</TABLE>
<PAGE>
(1) These options to purchase the UBS's Common Stock at $8.54 per share
were issued in December 1998 to replace options that expired in 1998. The
options have a ten year term.
Dr. Emma C. Chappell, as Chairman of the Board and Chief Executive Officer
of the Bank and UBS, received a minimum annual salary of $150,000. A copy of the
employment agreement entered into among Dr. Chappell, the Bank and UBS is
incorporated herein by reference.
Ms. Smalls serves as President of the Bank and UBS pursuant to a two year
employment agreement entered into May 31, 2000
Ms. Hudson-Nelson serves as Senior Vice President and Chief Financial
Officer of the Bank and UBS pursuant to a two year employment agreement entered
into May 31, 2000.
One hundred thousand shares of the Bank's Common Stock are subject to a
Long Term Incentive Compensation Plan (the "Plan") under which options to
purchase the Bank's Common Stock may be granted to key employees of a price not
less than the fair market value thereof at the date of the grant ("Options"),
and Common Stock may be awarded as Restricted Stock, subject for a period of
time to substantial risk of forfeiture and restrictions on disposition as
determined by the Compensation Committee as of the date of the grant
("Restricted Stock"). Pursuant to the Plan, options are granted in tandem with
Stock Appreciation Rights allowing the holder of an Option to surrender the
Option and receive an amount equal to the appreciation in market value of a
fixed number of shares of Common Stock from the date of the grant of the Option
("SARs"). SARs may be payable in Common Stock or cash or a combination of both.
The Plan also allows the Compensation Committee to grant Performance Shares,
which are contingent rights to receive, when certain performance criteria have
been attained, amounts of Common Stock and cash determined by the Compensation
Committee for such an award. Such rights are subject to forfeiture or reduction
if performance goals specified are not met during the performance period. No
such options, restricted stock or SARs were granted for 1999 performance.
No deferred compensation, incentive compensation or any further
compensation pursuant to any plan has been paid by the Bank, or will be paid by
the Bank based on services rendered to the Bank to the date of this filing.
At its annual meeting held May 6, 1994, the shareholders of the UBS
approved the establishment of an Employee Stock Ownership Plan ("ESOP"). The
ESOP has not been formally activated by the UBS. No purchases have been made
pursuant to the ESOP.
Directors of the Bank are compensated for each meeting attended in the
amount of three hundred dollars fifty ($350) per Board meeting attended and one
hundred fifty dollars ($150) for each committee meeting attended. Directors who
are also salaried officers of the Bank receive no remuneration for their
services as Directors. During the year ended December 31, 1999, the Bank paid
Directors' fees to its "non-interested" Directors totaling $31,550. UBS has paid
no director fees since its inception.
Beginning in February, 2000, the Board of the Bank began meeting weekly. At
this time the Board reduced its compensation to provide that each director will
continue to receive compensation for only one board and committee meeting per
month.
<PAGE>
2. INDEPENDENT AUDITORS
The Board of Directors has selected Grant Thornton LLP as independent
auditors to audit and certify consolidated financial statements of UBS for the
year ending December 31, 1999 and to provide certain accounting services to UBS
during 2000. Grant Thornton LLP has served in this capacity since October, 1997.
A representative of Grant Thornton LLP will be present at the meeting if
requested by a shareholder (either by telephone or in writing) in advance of the
meeting. Such requests should be directed to the Secretary of UBS.
REQUIRED VOTE
An affirmative vote of a majority of the shares of UBS represented at the
meeting will be required to ratify this appointment. The Board of Directors
recommends a vote for this proposal.
3. AUTHORIZATION OF ADDITIONAL NON-VOTING COMMON STOCK.
On September 30, 1998 the Articles of Incorporation of UBS were amended, by
filing of Articles of Amendment with the Commonwealth of Pennsylvania on
September 30, 1998. Of the 2,000,000 shares of Common Stock authorized, 250,000
have been designated Class B Common Stock. As of March 31, 1999, 166,666 shares
of Class B Common Stock were issued and outstanding.
REQUIRED VOTE.
An affirmative vote of a majority of the shares of UBS represented at the
meeting will be required to authorize the additional shares of Class B Common
Stock. The Board of Directors recommends a vote for this proposal.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
OFFICERS AND DIRECTORS OF UNITED BANK OF PHILADELPHIA
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION YEAR FIRST
NAME AGE AND OTHER DIRECTORSHIPS BECAME DIRECTOR
---- --- ----------------------- ---------------
<S> <C> <C> <C>
James F. Bodine ... 78 Retired as Managing 1993
Partner, Urban Affairs
Partnership Phila., PA.
S. Amos Brackeen ... 81 Founder and Pastor, 1993
Philippian Baptist
Church of Phila., PA.
Emma C. Chappell .. 59 Chairman of 1993
the Board, President and CEO
of Registrant and United Bank
of Philadelphia
Kemel G. Dawkins ... 76 President, Kemrodco 1993
Development and
Construction Company, Inc.,
President, Kem-Her
Construction Company
Inc., Phila., PA.
L. Armstead Edwards ... 57 Treasurer, 1993
United Bancshares, Inc.
Owner and President,
P.A.Z., Inc.,
Philadelphia., PA
Marionette Y. Frazier ... 55 Partner, 1996
John Frazier, Inc.
Philadelphia, PA
William C. Green ... 75 Co-founder, Ivy Leaf 1993
Middle School, Philadelphia, PA
Angela M. Huggins ... 60 President and CEO 1993
RMS Technologies Inc. Foundation
William B. Moore ... 57 Secretary, United Bancshares, Inc. 1993
Pastor, Tenth Memorial
Baptist Church,
Philadelphia, PA
Ernest L. Wright ... 71 Founder, President and 1993
CEO of Ernest L. Wright
Construction Company Phila., PA
</TABLE>
Each of these officers and directors are also officers and directors of
UBS. See "Election of Directors."
<PAGE>
LOANS TO OFFICERS AND DIRECTORS
As of December 31, 1999, the Bank had loans to certain officers and
directors and their affiliated interests in aggregate dollar amount of
approximately $1,442,600. Such transactions are made on substantially the same
terms, including interest rate and collateral, as those prevailing at the time
for other non-related party transactions.
300 NORTH THIRD STREET
The Bank leases its corporate headquarters facility from ECC Properties,
LLC. ECC Properties, LLC is owned by Dr. Chappell. For a detailed discussion of
this transaction is contained in the Annual Report.
PHILADELPHIA UNITED
Dr. Chappell, who served as Chairman, President and CEO of the Bank and UBS
also serves as Chairman of Philadelphia United Community Development Corporation
("Philadelphia United"). Her daughter, Tracey Carter, serves as President of
Philadelphia United. The Bank subleases office space to Philadelphia United.
OTHER INFORMATION
BENEFICIAL OWNERSHIP OF COMMON STOCK
The following table sets forth certain information regarding UBS's
Common Stock owned by: (i) each person who is known by the Board of Directors of
UBS to be the beneficial owner of more than 5% of UBS's outstanding Common
Stock; (ii) each of UBS's Directors, nominees for Director and principal
officers of UBS as a group:
<TABLE>
<CAPTION>
NUMBER OF SHARES AND
THE PERCENTAGE OF EACH
CLASS OF VOTING
NAME AND ADDRESS COUNTRY OF CITIZENSHIP SECURITIES OWNED
---------------- ---------------------- ----------------
<S> <C> <C>
Philadelphia Municipal Retirement USA 71,667 shares
System 6.97%
2000 Two Penn Center
Philadelphia, PA 19102
</TABLE>
<PAGE>
DIRECTORS AND OFFICERS OF THE BANK
SHARES OF REGISTRANT'S COMMON STOCK
-----------------------------------
NAME BENEFICIALLY OWNED PERCENTAGE
---- ------------------ ----------
James F. Bodine 10,833 1.05%
S. Amos Brackeen 5,000 .49%
Emma C. Chappell(1) 7,000 .68%
Kemel G. Dawkins 8,333 .81%
L. Armstead Edwards 10,833 1.05%
Marionette Y. Frazier 9,350 .91%
William C. Green (2) 13,833 1.34%
Angela M. Huggins 4,200 .41%
William B. Moore 1,000 .10%
Ernest L. Wright 5,000 .49%
------ ----
TOTAL 75,882 7.33%
====== ====
(1) Dr. Chappell also acts as Trustee of a voting trust agreement pursuant to
which Fahnstock, Inc deposited 5,209 shares of Common Stock of UBS with Dr.
Chappell as Trustee, to be voted by Dr. Chappell pursuant to the terms of
the Voting Trust. The term of the Voting Trust is ten years.
Dr. Chappell acts as Trustee of a voting trust agreement pursuant to which
NationsBank Corporation deposited 33,500 shares of Common Stock of UBS with
Dr. Chappell as Trustee, to be voted by Dr. Chappell pursuant to the terms
of the Voting Trust. The term of the Voting Trust is ten years.
Dr. Chappell also owns options to purchase up to 29,694 shares of the
common stock of UBS at a purchase price of $8.54 per share. These options
were awarded in December, 1998 and remain in effect for a term of ten years
from that date.
(2) Owned jointly with Liller B. Green, his wife.
LITIGATION
A complaint has been filed by the investors of a depositor, Monument
Financial Group, naming the Bank as a party. The complaint filed in the Court of
Common Pleas of Philadelphia County. The investors allege that, as a result of
the actions of the Bank in permitting the processing of certain checks in what
plaintiffs assert was an improper manner, the depositor was unable to pay
certain obligations to the plaintiffs. The complaint seeks damages in excess of
$400,000.
The Bank has defenses to the allegations raised in the complaint. Based
upon these allegations, the Bank believes that it is not liable. In addition,
the Bank has insurance that will cover any loss, including costs of defense, in
excess of a $50,000 deductible.
No other material claims have been instituted or threatened by or against
Registrant or its affiliates other than in the ordinary course of business.
ADJOURNMENT
If sufficient votes in favor of any of the proposals set forth herein are
not received by the time scheduled for the meeting, the persons named as proxies
may propose one or more adjournments of the meeting for a period or periods of
not more than 60 days in the aggregate to permit further solicitation of proxies
with respect to any such proposal. Any adjournment will require the affirmative
vote of a majority of the votes cast on the question in person or by proxy at
the session of the meeting to be adjourned. The persons named as proxies will
vote in favor of such adjournment those proxies which they are entitled to vote
in favor of such proposals. They will vote against any such adjournment those
proxies required to be voted against any such proposals. The Bank pays the costs
of any additional solicitation and of any adjourned session.
OTHER MATTERS
The Board of Directors knows of no other business to be brought before the
meeting. However, if any other matters come before the meeting, it is the
intention that the proxies which do not contain specific restrictions to the
contrary will be voted on such matters in accordance with the judgment of the
persons named on the enclosed form of proxy.
<PAGE>
FINANCIAL STATEMENTS
The consolidated financial statements of UBS are not set forth in this
Proxy Statement. However, they are distributed herewith in the Annual Report of
UBS for the year ended December 31, 1999.
----------------------------
YOUR VOTE IS IMPORTANT
NO MATTER HOW MANY SHARES YOU OWN PLEASE INDICATE YOUR VOTING INSTRUCTIONS
ON THE ENCLOSED PROXY FORM, DATE AND SIGN IT, AND RETURN IT IN THE ENVELOPE
PROVIDED, WHICH IS ADDRESSED FOR YOUR CONVENIENCE AND NEEDS NO POSTAGE, IF
MAILED IN THE UNITED STATES. IN ORDER TO AVOID ADDITIONAL EXPENSE TO UBS OR
FURTHER SOLICITATION, WE ASK YOUR COOPERATION IN MAILING YOUR PROXY FORM
PROMPTLY.
----------------------------
