UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

SCHEDULE 14A

(RULE 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities

Exchange Act of 1934 (Amendment No.    )

Filed by the Registrant  x                    Filed by a Party other than the Registrant  ¨

Check the appropriate box:

UNITED SECURITY BANCSHARES, INC.

(Name of Registrant as Specified in its Charter)

N/A

(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)

Payment of Filing Fee (Check the appropriate box):

TO OUR SHAREHOLDERS:

We will hold the 20122015 Annual Meeting of Shareholders of United Security Bancshares, Inc. (“Bancshares”USBI”), at 2:10:00 p.m.a.m., Central Daylight Time, on Wednesday, May 9, 2012,Friday, April 24, 2015, at Alabama Southern Community College, 30755 Highway 43 South, Thomasville, Alabama 36784.

We have enclosed a notice of the meeting, a proxy statement, a proxy card and the Annual Report to Shareholders for 20112014 and hope that you will study the enclosed materials carefully and attend the meeting in person.

Whether or not you plan to attend the meeting, please complete, sign and date the enclosed proxy card and return it as promptly as possible. You may return the proxy by facsimile orcard by mail in the accompanying envelope, or you may vote your shares via the Internet or by telephone. Please review the instructions on each of these options in the proxy statement and on your proxy card. You may revoke your proxy by voting in person at the meeting, by signing and delivering a later-dated proxy card, by giving written notice of revocation to the Secretary of BancsharesUSBI or by a later vote via the Internet or by telephone at any time before the proxy is voted.

Sincerely,

Hardie B. KimbroughAndrew C. Bearden, Jr.

Chairperson of the Board

James F. House

President and Chief Executive Officer

April 3, 2012March 20, 2015

UNITED SECURITY BANCSHARES, INC.

131 West Front Street

Post Office Box 249

Thomasville, Alabama 36784

(334)636-5424

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

to be held on

May 9, 2012April 24, 2015

TO THE SHAREHOLDERS OF UNITED SECURITY BANCSHARES, INC.:

United Security Bancshares, Inc. (“Bancshares”USBI”) will hold its 20122015 Annual Meeting of Shareholders (the “Annual Meeting”) at Alabama Southern Community College, 30755 Highway 43 South, Thomasville, Alabama 36784, on Wednesday, May 9, 2012,Friday, April 24, 2015, at 2:10:00 p.m.a.m., Central Daylight Time, for the following purposes:

The Board of Directors has fixed the close of business on March 14, 20125, 2015 as the record date for the determination of shareholders entitled to notice of and to vote at the Annual Meeting.

A complete list of the shareholders of BancsharesUSBI will be available and open for examination by any shareholder of BancsharesUSBI during ordinary business hours beginning two business days after the mailing of this notice of the Annual Meeting.

All shareholders are cordially invited to attend the Annual Meeting. Information on how to obtainabout the Annual Meeting, including directions to be able to attend the Annual Meeting, and vote in person can be found at the following website: http://www.cfpproxy.com/4328.www.edocumentview.com/USBI. Whether or not you plan to attend the Annual Meeting in person, you are requested to complete, sign and date the enclosed proxy card and send it promptly by facsimile or mail in the envelope provided for this purpose, or vote your shares via the Internet or by telephone using the instructions provided in the proxy statement and on your proxy card. The proxy may be revoked by voting in person at the Annual Meeting, by signing and delivering a later-dated proxy card, by giving written notice of revocation to the Secretary of BancsharesUSBI or by a later vote via the Internet or by telephone at any time prior to the voting thereof.

By Order of the Board of Directors,

Beverly J. Dozier

Secretary

Thomasville, Alabama

April 3, 2012March 20, 2015

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON MAY 9, 2012: BANCSHARES’APRIL 24, 2015: USBI’S PROXY STATEMENT AND 20112014 ANNUAL REPORT ARE AVAILABLE AT http://www.cfpproxy.com/4328.www.edocumentview.com/USBI.

PROXY STATEMENT

TABLE OF CONTENTS

i

UNITED SECURITY BANCSHARES, INC.

131 West Front Street

Post Office Box 249

Thomasville, Alabama 36784

(334) 636-5424

PROXY STATEMENT

TABLE OF CONTENTS

i

UNITED SECURITY BANCSHARES, INC.

131 West Front Street

Post Office Box 249

Thomasville, Alabama 36784

(334)636-5424

PROXY STATEMENT

FOR THE

20122015 ANNUAL MEETING OF SHAREHOLDERS

TO BE HELD ON MAY 9, 2012APRIL 24, 2015

INTRODUCTION

This Proxy Statement is furnished on or about April 3, 2012March 20, 2015 by United Security Bancshares, Inc. (“Bancshares”USBI”) to the holders of common stock of BancsharesUSBI in connection with the 20122015 Annual Meeting of Shareholders, and any adjournments or postponements thereof, to be held on Wednesday, May 9, 2012,Friday, April 24, 2015, at 2:10:00 p.m.a.m., Central Daylight Time, at Alabama Southern Community College, 30755 Highway 43 South, Thomasville, Alabama 36784 (the “Annual Meeting”). The matters to be considered and acted upon are:

The Board of Directors of BancsharesUSBI is soliciting the proxy, which is revocable at any time before it is voted. You may revoke the proxy by voting in person at the Annual Meeting, by signing and delivering a later-dated proxy card, by giving written notice of revocation to the Secretary of BancsharesUSBI or by a later vote via the Internet or by telephone. We must, however, actually receive the written notice,later-dated proxy card or later Internet or telephone vote before the vote of the shareholders. We will vote all properly executed proxies delivered pursuant to this solicitation at the Annual Meeting and in accordance with instructions given, if any. If no instructions are given, we will vote the proxies as recommended by the Board – FOR Proposals 1, 2 and 3 – and in accordance with the instructions of management as to any other matters that may come before the Annual Meeting.

To vote by proxy, you must do one of the following:

NOTE: If your shares are held in a stock brokerage account or by a bank or other nominee, you are considered the beneficial owner of shares held in “street name,” and these proxy materials are being forwarded to you by your broker, bank or other nominee who is considered the shareholder of record with respect to those shares, and youshares. You must follow the instructions for voting your shares that you receive from your broker, bank or other nominee. Please refer to the section below entitled “Voting Shares Held in ‘Street Name’” for more information about how to vote your shares.

Bancshares

USBI will pay the cost of soliciting proxies. In addition to soliciting proxies by mail, we may solicit proxies by personal interview, telephone, facsimile and electronic communication. Banks, brokers or other nominees will forward the proxy materials to their principals or beneficial owners and obtain authorization for the execution of proxies. BancsharesUSBI will, upon request, reimburse banks, brokers and other nominees for their reasonable expenses in forwarding proxy materials to their principals or beneficial owners.

Shareholders Eligible to Vote

We are sending this Proxy Statement to shareholders of record as of the close of business on March 14, 2012.5, 2015. Only shareholders as of this date are eligible to vote at the Annual Meeting. At the close of business on March 14, 2012,5, 2015, there were 6,036,7926,043,292 shares of the common stock of Bancshares,USBI, par value $0.01 per share, outstanding.outstanding and eligible to receive notice of and to vote at the Annual Meeting. Each shareholder is entitled to one vote in person or by proxy for each share of common stock held on all matters properly to come before the Annual Meeting.

Information About a Quorum

At the Annual Meeting, the presence of a majority of the outstanding shares of Bancshares’USBI’s common stock entitled to vote, represented in person or by proxy, shall constitute a quorum for the transaction of business. If a quorum is not present, or if the Chairperson of the Annual Meeting decides that more time is necessary for the solicitation of proxies, the Chairperson may adjourn the Annual Meeting, with or without a shareholder vote. Alternatively, if there is a shareholder vote to adjourn the Annual Meeting based on the absence of a quorum, the named proxies will vote all shares of common stock for which they have voting authority in favor of the adjournment.

Vote Required to Approve Proposals

Assuming the presence of a quorum, the directors of BancsharesUSBI will be elected by a plurality of the shares cast at the Annual Meeting – in other words, the director nomineesdirector-nominees receiving the most votes will be elected (Proposal 1). The ratification of the appointment of Carr, Riggs & Ingram, LLC as independent registered public accountants for the year ending December 31, 20122015 (Proposal 2) will require the affirmative vote of a majority of the shares represented at the Annual Meeting in person or by proxy and entitled to vote on the matter. Proposal 3 calls for the advisory approval of Bancshares’USBI’s executive compensation and will require for adoption the affirmative vote of a majority of the shares represented at the Annual Meeting in person or by proxy and entitled to vote on the matter.

Following the Annual Meeting, we will file a Current Report on Form 8-K with the Securities and Exchange Commission to disclose the results of voting on each proposal, as required by applicable rules.

Abstentions

A shareholder may abstain from voting or withhold his or her vote, as applicable (collectively, “abstentions”), with respect to each item submitted for shareholder approval.approval, including the election of directors. Abstentions will be counted as present for purposes of determining the existence of a quorum but will be counted as not voting on any proposal brought before the Annual Meeting. Since the election of directors (Proposal 1) is determined by the votes cast at the Annual Meeting, abstentions will not affect the outcome of this matter. An abstention as to the ratification of the appointment of Carr, Riggs &

Ingram, LLC as independent registered public accountants for the year ending December 31, 20122015 (Proposal 2) and as to the advisory approval of Bancshares’USBI’s executive compensation (Proposal 3) will have the same effect as voting against these proposals, given that the outcome of each proposal is determined by the shares represented at the Annual Meeting and entitled to vote on the matter.

Voting Shares Held in “Street Name”

If your shares are held in a stock brokerage account or by a bank or other nominee, you are considered the beneficial owner of shares held in “street name,” and these proxy materials are being forwarded to you by your

broker, bank or other nominee who is considered the shareholder of record with respect to those shares. As the beneficial owner, you have the right to direct your broker, bank or other nominee on how to vote, and you are also invited to attend the Annual Meeting. Your broker, bank or other nominee has enclosed a voting instruction card for you to use in directing the broker, bank or other nominee regarding how to vote your shares. If you hold your shares in “street name,” it is critical that you return the voting instruction card as directed by your broker, bank or other nominee if you want your votes to count in the election of directors (Proposal 1) and with respect to the advisory approval of Bancshares’USBI’s executive compensation (Proposal 3). If you hold your shares in “street name” and want to vote in person at the Annual Meeting, you must obtain a proxy from your broker, bank or other nominee and bring that proxy to the Annual Meeting.

In the past, if you held your shares in “street name,” and you did not indicate how you wanted your shares to be voted in the election of directors, your broker, bank or other nominee was allowed to vote those shares on your behalf in the election of directors as they felt appropriate. Certain regulatory changes have taken away the ability of your broker, bank or other nominee to vote your uninstructed shares in the election of directors on a discretionary basis. Similarly, if you do not direct your broker, bank or other nominee as to how to vote with respect to the advisory approval of USBI’s executive compensation matter (Proposal 3), your broker, bank or other nominee may not vote on these matters.Therefore, if you hold your shares in “street name” and do not instruct your bank, broker or other nominee on how to vote in the election of directors or with respect to the advisory approval of executive compensation, matter, your shares will not be voted for any director nominee,director-nominee, the executive compensation matter or on any other proposal onwith respect to which your broker, bank or other nominee does not have discretionary authority (resulting in a “broker non-vote”).

Broker non-votes are counted for general quorum purposes but are not deemed to be present with respect to any matter for which a broker does not have discretionary authority to vote. Broker non-votes will not be counted for purposes of the election of directors (Proposal 1) but will have no effect on the outcome of the election of directors based on the plurality voting standard. Broker non-votes will not be taken into account in determining the outcome ofwith respect to the advisory approval of Bancshares’ executive compensation (Proposal 3). Your bank, broker or other nominee will continue to have discretion to vote any uninstructed shares on the ratification of the appointment of Carr, Riggs & Ingram, LLC as independent registered public accountants for the year ended December 31, 20122015 (Proposal 2); therefore, there should be no broker non-votes with respect to this item.

PROPOSAL 1

ELECTION OF DIRECTORS

Bancshares’USBI’s Bylaws provide that the Board of Directors shall consist of not less than three (3) and not more than twenty-five (25) directors, and, if a number is not fixed by the Board of Directors, the Bylaws state that there shall be sixteen (16) directors. Effective December 31, 2011, Dr. Wayne C. Curtis, who served as a member ofThere are currently fifteen (15) directors serving on the Board, of Directors since 2000, retired from the Board of Directors. Further, on December 31, 2011, Dan R. Barlow, who has served as a member of the Board of Directors since 1997, notified Bancshares that he would not stand for re-election to the Board of Directors at the Annual Meeting. As a result of these events,and, at a meeting on February 23, 2012,27, 2015, the Board of Directors approved a reduction invoted to maintain the current size of the Board of Directors to eleven (11) persons, effective as of the conclusion offollowing the Annual Meeting. The Nominating, Executive and Corporate Governance Committee and the current Board of Directors believe that a Board of Directors of eleven (11)fifteen (15) persons is practical and efficient at this point in time.

Based on the nomination bynominations of the Nominating, Executive and Corporate Governance Committee, the Board of Directors recommends that the shareholders elect the eleven (11)fifteen (15) director-nominees named below to hold office until the 20132016 Annual Meeting of Shareholders of BancsharesUSBI or until their successors are elected and qualified. All of the nominees currently serve as directors. Unless “Withhold” or “For All Except” is noted as to all or some of the nominees, proxies will be voted at the Annual Meeting FOR the election of the eleven (11)fifteen (15) nominees to the Board of Directors. Shareholders may not vote for a greater number of persons than the number of nominees named. The Board recommendsTHE BOARD RECOMMENDS THAT YOU VOTEFOR THE ELECTION OF THE ELEVEN (11)FIFTEEN (15) NOMINEES.

While we know of no reason why any nominee would be unable to serve as a director, if, before the voting at the Annual Meeting, any person nominated to be elected as a director is unable to serve, the shares that would otherwise be voted for suchthat person may be voted for the election of sucha substitute person asrecommended by the Board of Directors may recommend.Directors.

The following provides certain biographical information about the individuals who have been nominated for election as directors of Bancshares.USBI. Each of the nominees currently serves as a director of Bancshares.USBI. The biographical information for each of the nominees below contains a description of the individual’s service as a director, business experience, director positions held currently or at any time during the last five years, if applicable, information regarding involvement in certain legal or administrative proceedings, if applicable, and the experiences, qualifications, attributes and skills that caused the Board of Directors to determine that the individual should serve as a director. The stock ownership with respect to each nominee is set forth in the table entitled “Security Ownership of Certain Beneficial Owners and Management” that appears in this Proxy Statement on page 28.Statement.

Subsequent to the Annual Meeting, Bancshares,USBI, as the sole shareholder of First United SecurityUS Bank, (“First United Security”), Bancshares’USBI’s banking subsidiary (the “Bank”), intends to re-elect all of the newly-electednewly elected directors of BancsharesUSBI as directors of First United Security. Mr. Kimbrough is currently the Chairperson of the Board of Bancshares and the Chairperson of the Board of First United Security.Bank.

Information regarding the executive officers of BancsharesUSBI who are not directors as well as information regarding Mr. Barlow, who is not standing for re-election to the Board of Directors at the Annual Meeting, is also provided.provided below.

Information About Director-Nominees

Gerald P. Corgill Director since 1985 Age 7073		Mr. Corgill has served as President of Dozier Hardware Company, Inc., a hardware and building supply company, including a gift shop, in Thomasville, Alabama since 1982.   The Board of Directors believes that Mr. Corgill’s skills and business experience, as well as the various operational and leadership roles in which he has served his business, all provide him with a wide range of knowledge on topics important to business, which knowledge contributes greatly to the composition of the Board of Directors.
John C. Gordon Director since 1997 Age 5457		Mr. Gordon has been self-employed, performing forestry, timberland and investment services for Forest Services, Inc. (land management) since 1994 and for SS&J Land Co., Inc. since 1998. Mr. Gordon serves as president of both entities.   Mr. Gordon’s business management, investment and risk assessment skills obtained from his leadership of these companies and his experience in the forestry business are all valuable to the Board of Directors.
William G. Harrison Director since 1976 Age 6668		Mr. Harrison served as Timber Settlements and Records Manager for Linden Lumber Company (sawmill) from 1999 until his retirement in 2008. For approximately 20 years prior to his position at Linden Lumber Company, Mr. Harrison was the Chief Executive Officer and sole owner of Bedsole Dry Goods, a department storeretail chain consisting of department stores and variety stores.   The Board of Directors believes that Mr. Harrison’s extensive business experience, specifically his understanding of accounts management and credit and collection risk, contributes greatly to the composition of the Board of Directors.

James F. House Director since 2011 Age 5962		Mr. House became a director of BancsharesUSBI pursuant to an employment agreement among Bancshares, First United SecurityUSBI, the Bank and Mr. House dated November 7, 2011, and Mr. House has served as President and Chief Executive Officer of BancsharesUSBI and First United Securitythe Bank since then.that date. Mr. House has extensive prior experience in the banking industry. From May 2009 until November 2011, he served as Florida Division President of BankTrust. From 2005 until 2009, Mr. House was a business consultant focusing on management, investments and commercial and consumer lending issues. Prior to that, he held numerous executive and senior management positions with SouthTrust Bank, including Executive Vice President, General Bank Commercial (2003-2004); Chief Executive Officer, Urban West Region (2002-2003); Chief Executive Officer, North Alabama/Tennessee Region (2000-2001); Chief Executive Officer, Birmingham Market Bank (1999-2003); and Chairman and Chief Executive Officer, SouthTrust Bank of Dothan, N.A. (1994-1998).   The Board of Directors believes that, from these years of experience in a number of positions and areas in banking and his senior executive level services to BancsharesUSBI and First United Security,the Bank, Mr. House has gained an intimate knowledge of the banking industry and, more specifically, the business and operations of BancsharesUSBI and First United Security,the Bank, which provides valuable insight to the Board of Directors.

Hardie B. Kimbrough Director since 1986 Age 74		Mr. Kimbrough is currently Of Counsel with the Gilmore Law Firm. Mr. Kimbrough served as Presiding Circuit Judge for the First Judicial Circuit of the State of Alabama from 1977 until his retirement in 1995. Through his years of experience as a lawyer and member of the judiciary, Mr. Kimbrough gained extensive knowledge of the communities served by Bancshares and First United Security and the economies of those communities, which has provided Mr. Kimbrough with valuable risk and creditworthiness assessment skills. Mr. Kimbrough has also undergone extensive training in bank management and leadership in his role as Chairperson of the Board. The Board of Directors believes that all of this experience, in addition to Mr. Kimbrough’s understanding and knowledge of Bancshares and First United Security gained from his years of service to these institutions, contributes greatly to the composition of the Board of Directors.
J. Lee McPhearson Director since 2009 Age 5861		Mr. McPhearson is an attorney, currently practicing in Butler, Alabama. Mr. McPhearson also serves as County Attorney for Choctaw County, Alabama. From 1995 until 2002, Mr. McPhearson served as Circuit Judge for the First Judicial Circuit of the State of Alabama and previously served from 1981 until 1987 as District Attorney for the First Judicial Circuit. Mr. McPhearson is currently actively involved in timber and real estate enterprises.   Mr. McPhearson’s legal experience as a legal practitioner, which involvedinvolves some representation and advising of business entities, as well as his knowledge and understanding of the communities served by BancsharesUSBI and First United Securitythe Bank gained through his time on the bench, all contribute greatly to the Board of Directors. Additionally, Mr. McPhearson’s experience in the timber and real estate industries provides valuable insight to the Board of Directors regarding land and timber valuations and market conditions, which are important to the business of BancsharesUSBI and First United Security.the Bank.
Jack W. Meigs Director since 1997 Age 5457		Mr. Meigs has served as Circuit Judge for the Fourth Judicial Circuit of the State of Alabama since 1991.   The Board of Directors believes that Mr. Meigs’ extensive legal experience in the local area, both as a practitioner and as a judge, provides him with a wide range of management skills and knowledge on topics important to business,businesses, which contributecontributes greatly to the composition of the Board of Directors.
Aubrey S. Miller Director since 2014 Age 62		Mr. Miller has served as Executive Director of the Juvenile Diabetes Research Foundation in Birmingham, Alabama and as President of the Shelby County, Alabama Board of Education since 2009. He served as President and Chief Development Officer of the Baptist Health Foundation in Birmingham from 2005 to 2008. The Board of Directors believes that Mr. Miller’s extensive experience in leading multiple organizations and in effectively creating and implementing budgets and strategic plans allow him to provide valuable insight and advice to the Board of Directors.
Donna D. Smith Director since 2014 Age 66		Ms. Smith served as the Vice President of Human Resources and Ethics for Alabama Power Company from 2010 until her retirement in February 2014 and as Human Resources Director of Alabama Power Company and Southern Company Generation for several years prior to that. She also served on the board of directors of the Alabama Power Company Foundation and remains active in leadership positions with several philanthropic organizations and boards. The Board of Directors believes that Ms. Smith brings a valuable perspective to the Board of Directors as a result of her extensive experience in a highly regulated industry, deep and broad business experience as an executive at one of the largest employers in the state of Alabama and strong history of community involvement.
A. J. Strickland, III Director since 2013 Age 73		Dr. Strickland is the John R. Miller Professor of Strategic Management in the Graduate School of Business at the University of Alabama, a position he has held since 1969. Dr. Strickland is a director of American Equity Investment Life Holding Company and Twenty Services, Inc. and a former director of Statesman. Dr. Strickland is also the co-author of many strategic management books and texts used at universities worldwide. In addition, he conducts frequent industry and competitive analyses of domestic and international firms. The Board of Directors believes that Dr. Strickland’s extensive knowledge of strategic management and the finance industry arising from his academic and practical experience enable him to provide valuable insight to the Board of Directors.

Howard M. Whitted Director since 1985 Age 6770		Mr. Whitted was a forester for Weyerhaeuser Company, a forest products and container board manufacturer, from 1968 until his retirement in 2006. Mr. Whitted is currently a forester and manager for Whitted Family Holdings.   The Board of Directors believes that Mr. Whitted’s general business experience and, specifically, his experience in the real estate and forestry industry provide valuable insight to the Board of Directors regarding land and timber valuations and market conditions, which are important to the business of BancsharesUSBI and First United Security.the Bank.
Bruce N. Wilson Director since 1997 Age 5760		Mr. Wilson is a senior partner in the law firm of Wilson & Drinkard, where he has worked since 1993.   Through his law practice, Mr. Wilson has represented and continues to represent business and corporate clients throughout all phases of their operations. He counsels clients on various real estate, industrial and economic development, and budgetary and auditing issues. The Board of Directors believes that Mr. Wilson’s experience and understanding of these issues enable him to provide valuable insight to the Board of Directors.

Director Not Standing for Re-election

Information About Executive Officers Who Are Not Also Directors

Eric H. Mabowitz Age 5356		Mr. Mabowitz currently serves as Executive Vice President, Retail Division, Branch Administrator and Director of Community Lending of First United Security.the Bank. Mr. Mabowitz joined First United Securitythe Bank in March 2008 and previously served as Executive Vice President, Senior Lender, and Branch Administrator and as Executive Vice President, Chief Credit Officer. Prior to his employment with First United Security,the Bank, Mr. Mabowitz served as President and Chief Operating Officer of Premier Bank of the South in Cullman, Alabama from June 2007 until March 2008; as Executive Vice President, Administration for First Community Bank in Chatom, Alabama from September 2006 until June 2007; and as Executive Vice President, Chief Credit Officer for First Community Bank in Chatom, Alabama from July 2001 until September 2006.

D. Phillip Maughan, II Age 4750		Mr. Maughan has served as Executive Vice President, Commercial Division, and Senior Lender of First United Securitythe Bank since October 2010. Mr. Maughan has served in various executive level positions in the financial services industry, including as Executive Vice President and Regional President of Capstone Bank beginning infrom 2008 until October 2010 and as President and Chief Executive Officer of Security Bank from 2006 until 2008. Prior to 2006, Mr. Maughan held a number of positions with AmSouth Bank and then SouthTrust/with SouthTrust Bank/Wachovia Bank.
Craig B. NelsonDavid L. Saylors Age 5470		Mr. Nelson, whoSaylors joined First United Securitythe Bank in January 2011,August 2012 and currently serves as Executive Vice President, Credit Division, and Chief Credit OfficerDirector of First United Security.Human Resources. Prior to his employment with First United Security,the Bank, Mr. NelsonSaylors served as Managing Member of CBN Financial Group LLC (beginning in May 2010); as Senior Vice President Regional Credit Officerand Director of Human Resources of Capstone Bank in Tuscaloosa, Alabama from November 2009 until August 2012; Executive Assistant to the President (from April 2009 until November 2009) and Financial Accountant (December 2007 until April 2009) for M&FMarion Military Institute in Marion, Alabama; and Senior Vice President and Director of Human Resources of The Peoples Bank (from February 2006and Trust in Selma, Alabama from August 2000 until May 2010); and in various capacities with M&F Bank’s predecessor bank, First National Bank of Shelby County, including President, Chief Credit Officer and member of the Board of Directors (from June 2004 until February 2006).December 2007.
William C. MitchellJ. Daniel Matheson, III Age 4657		Mr. MitchellMatheson has served as President and Chief ExecutiveInvestment Officer of First United Security’s subsidiary, Acceptance Loan Company,USBI since May 2001 and as Senior Vice President, Investment Officer, of the Bank since 1996. Mr. Matheson serves as Senior Vice President of Synovus Securities and is the owner and President of R2Metrics, Inc., a provider of investment and asset and liability management software, analytics and consulting services for banks, which was owned by the Bank until January 1, 2009.
Phillip R. Wheat Age 52		Mr. Wheat joined the Bank in April 2013 and currently serves as Senior Vice President, Chief Information Officer and Information Security Officer of the Bank. Prior to joining the Bank, Mr. Wheat was employed by BankTrust of Mobile, Alabama. Mr. Wheat has served in senior management roles relating to technology and operations at various financial institutions for more than twenty-five years.
Beverly J. Dozier Age 50		Ms. Dozier currently serves as Vice President, Secretary and Assistant Treasurer of USBI and Senior Vice President, Executive Administration, of the Bank. Ms. Dozier has served the Bank in numerous capacities since February 20081984, including working as a loan officer and prior to that, as Interim President and Chief Executive Officer beginning in November 2007. Mr. Mitchell has worked with Acceptance Loan Company, Inc. since May 1997.mortgage originator.

CORPORATE GOVERNANCE

BancsharesUSBI is committed to having sound corporate governance principles. Operating in accordance with such principles is essential to running Bancshares’USBI’s business effectively and to maintaining Bancshares’USBI’s integrity in the marketplace. Bancshares’USBI’s Board has adopted a Code of Business Conduct and Ethics that sets forth basic principles to guide Bancshares’USBI’s and First United Security’sthe Bank’s employees, including the Chief Executive Officer, the Chief Financial Officer and other senior executive officers, in their conduct and compliance with applicable laws and governance principles. A copy of the United Security Bancshares, Inc. Code of Business Conduct and Ethics is filed asExhibit 14 to our Annual Report on Form 10-K for the year ended December 31, 2003. Additionally, BancsharesUSBI will furnish any person without charge, upon written request, a copy of the United Security Bancshares, Inc. Code of Business Conduct and Ethics.

The following is a summary of Bancshares’USBI’s Board independence standards, the Board and committee structure, the director nomination process and the procedures for shareholders to follow to communicate with the Board of Directors.

Director Independence

The Nasdaq Stock Market, LLC, the exchange on which Bancshares’USBI’s common stock is listed (“Nasdaq”), requires that a majority of the Bancshares’USBI’s Board members be independent.“independent.” Accordingly, because the Board of Directors currently has twelve (12)fifteen (15) members, at least seven (7)eight (8) of the directors must be independent; after the Annual Meeting, at least six (6) the eleven (11) directors must be independent. In accordance with Nasdaq’s listing standards,rules, a director is not considered to be independent unless the Board determines that the director has no relationship with BancsharesUSBI or its subsidiaries (either directly or as a partner, shareholder or officer of an organization that has a relationship with BancsharesUSBI or any of its subsidiaries) that would interfere with the exercise of the director’s independent judgment in carrying out the responsibilities of a director. Members of the Audit Committee, Compensation Committee and Nominating, Executive and Corporate Governance Committee also must meet the independence tests in the applicable Nasdaq listing standardsrules and the federal securities laws.

The Board has determined that none of the directors standing for re-election, with the exception of Mr. House, has any material relationship with BancsharesUSBI or any of its subsidiaries (either directly or as a partner, shareholder or officer of an organization that has a relationship with BancsharesUSBI or any of its subsidiaries) that would interfere with the exercise of independent judgment in carrying out his or her responsibilities. In making this determination, the Board considered transactions and relationships between each director or his or her immediate family and BancsharesUSBI and its subsidiaries. The purpose of this review was to determine whether any such transactions or relationships were material and possibly inconsistent with a determination that the director was independent. Mr. House is not independent because of his employment as the President and Chief Executive Officer of USBI and President of Bancshares and First United Security.the Bank.

During theWhile conducting its review of directors’director independence, determinations, the Board of Directors specifically considered the relationshipsrelationship between BancsharesUSBI and Wilson & Drinkard, of which Mr. Wilson is a senior partner, and between Bancshares and the Gilmore Law Firm, of which Mr. Kimbrough is Of Counsel. Bothpartner. Wilson & Drinkard and the Gilmore Law Firm areis a law firmsfirm that historically havehas provided legal services to BancsharesUSBI and its subsidiaries. Bancshares’USBI’s fee arrangementsarrangement with Wilson & Drinkard and the Gilmore Law Firm areis negotiated on the same basis and areis subject to the same terms and conditions as arrangements with other outside legal counsel for similar types of legal work. During 2011, Bancshares2014, USBI paid no$540 in legal fees to Wilson & Drinkard and approximately $12,179 in legal fees to the Gilmore Law Firm; however, based on his Of Counsel arrangement with the Gilmore Law Firm, Mr. Kimbrough did not directly receive any income, benefits or compensation from these payments.Drinkard. Based on this review, the Board concluded that Bancshares’ relationshipsUSBI’s relationship with Wilson & Drinkard and the Gilmore Law Firm dodoes not interfere with either Mr. Wilson’s or Mr. Kimbrough’s exercise of independent judgment in carrying out the responsibilities of a director.

Company Leadership Structure

The business of BancsharesUSBI is managed under the direction of the Board of Directors, which is elected by our shareholders. The basic responsibility of the Board is to lead BancsharesUSBI by exercising its business judgment to act in what each director reasonably believes to be the best interests of BancsharesUSBI and its shareholders. Leadership is

important to facilitatethe effective operation of the Board in acting effectively as a working group so that Bancshares and its performance may benefit.for the benefit of USBI. The role of the Chairperson includes providing continuous feedback on the direction, performance and strategy of Bancshares,USBI, presiding over meetings of the Board, setting the Board’s agenda with management and leading the Board in anticipating and responding to risks faced by Bancshares.USBI.

The roles of Chief Executive Officer and Chairperson of the Board have been separated since Bancshares’ initial public offering.USBI became a publicly traded company. While the Board believes that the Chief Executive Officer should be a member of the Board, the Board considers it to be advantageous to independence, oversight and objectivity to have a separate, independent board member to serve as Chairperson. The Board may reconsider this leadership structure from time to time based on then-current considerations.

Risk Oversight

General oversight of Bancshares’USBI’s risk management process is the responsibility of the Audit Committee of the Board of Directors.

BancsharesUSBI is exposed to a number of risks and regularly undertakes a review to identify and evaluate these risks and develop plans to manage them effectively. While the Chief Executive Officer has overall responsibility for risk assessment, management and prioritization, the Board has an active role in the risk oversight process.

The Board regularly reviews information regarding Bancshares’USBI’s financial, credit, liquidity, operational, legal, regulatory, compliance, reputational and strategic risks based on reports from management, including the Chief Executive Officer and the Chief Financial Officer. Although the full Board is ultimately involved in the risk oversight process, information regarding certain risks is reviewed first by the committees of the Board when a particular risk falls within the purview of a particular committee. For example, the Compensation Committee of the Board oversees the management of risks relating to Bancshares’USBI’s compensation policies and practices, including executive compensation. The Nominating, Executive and Corporate Governance Committee oversees risks associated with the independence of the members of the Board and potential conflicts of interest. The Audit Committee oversees the management of financial risks (including risks required to be monitored under the Sarbanes-Oxley Act). The conclusions of each Board committee are brought to the attention of all Board members at the regularly scheduled meetings of the Board. This enables the Board and its committees to coordinate with respect to the risk oversight role.

Board Structure and Committees

The Board of Directors of BancsharesUSBI conducts its business through meetings of the Board and Board committees. Further, executive sessions of the independent directors of the Board are to be held at least two times a year and otherwise as needed. These sessions are chaired by the Chairperson of the Board or another independent director selected by a majority of the independent directors.

During 2011,2014, the Board of Directors of BancsharesUSBI met twenty-five times.twelve times in regularly scheduled meetings. All of the incumbent directors attended at least 75% of the aggregate of the total number of meetings of the Board of Directors and the total number of meetings held by all committees of the Board of Directors on which he or she served withduring the exception of Mr. House, who did not become a member of the Board of Directors until November 7, 2011.year.

Directors are encouraged but not required to attend the annual meetingsAnnual Meeting of shareholders.Shareholders each year. All of the then-current directors attended Bancshares’ 2011USBI’s 2014 Annual Meeting of Shareholders as postponed and rescheduled to August 9, 2011.held on May 2, 2014.

Audit Committee

The Audit Committee assists the Board with its oversight responsibilities with respect to the financial reports and other financial information provided by BancsharesUSBI to its shareholders and others, Bancshares’USBI’s financial policies and procedures and disclosure controls and procedures, Bancshares’USBI’s system of internal controls and USBI’s

and Bancshares’ auditing, accounting and financial reporting processes. The Audit Committee operates under a written charter, that was last updated by the Board of Directors in December 2011, a copy of which is posted on First United Security’sthe Bank’s website at http://www.firstusbank.com under the tabs “About Us” – “Investor Relations.Relations” – “USBI Policies.” The Audit Committee is required on an annual basis to review and reassess the adequacy of its charter and recommend any changes to the full Board. Any revisions to the charter are to be made by the full Board. The Audit Committee last reviewed and assessed the adequacy of its charter on March 11, 2015. The Audit Committee met fourteenten times during 2011.2014. The Audit Committee Report appears later in this Proxy Statement on page 31.Statement.

Certain Nasdaq listing standardsrules and the federal securities laws require that at least one member of the Audit Committee hasmust have an understanding of generally accepted accounting principles and financial statements, the ability to assess the general application of such principles in connection with the accounting for estimates, accruals and reserves, experience preparing, auditing, analyzing or evaluating financial statements, or experience actively supervising one or more persons engaged in such activities, an understanding of internal control over financial reporting and an understanding of audit committee functions. The Board has determined that Andrew C. Bearden, Jr., Robert Stephen Briggs and A. J. Strickland, III each has the requisite attributes of an “audit committee financial expert.” Mr. Bearden acquired such attributes through his experience as a certified public accountant and through his supervision as chief financial officer of the financial reporting and compliance of a publicly traded financial institution. Mr. Briggs acquired such attributes through his experience overseeing the financial performance of a major division of a national life insurance company and through his service on other boards of directors of companies in the financial services industry, including audit committee service. Dr. Strickland acquired such attributes through his many years of service as a business school professor and his service on the boards of directors of other public companies, including audit committee service.

The members of the Audit Committee are A.J. Strickland, III, Chairperson, Andrew C. Bearden, Jr., Chairperson,Robert Stephen Briggs, William G. Harrison, Hardie B. KimbroughJ. Lee McPhearson and Jack W. Meigs. The Board has carefully evaluated the backgrounds of the members of the Audit Committee and determined that such members qualify as “independent”“independent,” as defined in the applicable Nasdaq listing standardsrules and as defined in the Audit Committee’scommittee’s charter.

Compensation Committee

The Compensation Committee assists the Board in overseeing and determining executive compensation. Among other responsibilities, the Compensation Committee reviews, recommends and approves salaries and other compensation of Bancshares’USBI’s and First United Security’sthe Bank’s executive officers and administers Bancshares’USBI’s equity compensation plans.plans that may be in place from time to time. The Chief Executive Officer assists the Compensation Committee with determining the amount of compensation to be paid to the other executive officers but does not play a role in the final determination or approval of his own compensation determination.compensation. The Compensation Committee operates under a written charter, that was last updated by the Board of Directors in 2006, a copy of which is posted on First United Security’sthe Bank’s website at http://www.firstusbank.com under the tabs “About Us” – “Investor Relations.Relations” – “USBI Policies.” The Compensation Committee is required on an annual basis to review and reassess the adequacy of its charter and recommend any changes to the full Board. Any revisions to the charter are to be made by the full Board. The Compensation Committee last reviewed and assessed the adequacy of its charter on March 11, 2015. The Compensation Committee met ten times in 2011.2014. The Compensation Committee Report appears later in this Proxy Statement on page 19.Statement.

The scope of the Compensation Committee’s authority is limited to the responsibilities that are set forth in its charter. In fulfilling its responsibilities, the Compensation Committee may delegate its authority to subcommittees to the extent permitted by applicable law. The charter further provides the Compensation Committee with the authority to engage independent consultants and legal advisers when determined to be necessary or appropriate in fulfilling its responsibilities. The Compensation Committee has sole authority to retain and terminate any such consultant or legal adviser, including sole authority to approve the fees and other retention terms.

The Compensation Committee has reviewed Bancshares’USBI’s compensation programs, plans and practices for all of its employees as they relate to risk management and risk-taking initiatives to ascertain if they serve to encourage

or incentincentivize risks that are “reasonably likely to have a material adverse effect” on Bancshares.USBI. As a result of this process, the Compensation Committee concluded and informed the Board that, based on the company’sUSBI’s current compensation programs, plans and practices, there are no such risks.

The members of the Compensation Committee are J. Lee McPhearson, Chairperson, Linda H. Breedlove,Andrew C. Bearden, Jr., Gerald P. Corgill, John C. Gordon and Howard M. Whitted.A. J. Strickland, III. The Board has carefully evaluated the backgrounds of the members of the Compensation Committee and determined that such members qualify as “independent”“independent,” as defined in the applicable Nasdaq listing standardsrules and as defined in the Compensation Committee’scommittee’s charter.

Nominating, Executive and Corporate Governance Committee

Among other responsibilities, the Nominating, Executive and Corporate Governance Committee reviews and recommends the selection of directors and members of committees of the Board and reviews and establishes the governance practices of Bancshares.USBI. The Nominating, Executive and Corporate Governance Committee operates under a written charter, that was adopted by the Board of Directors in 2004, a copy of which is posted on First United Security’sthe Bank’s website at http://www.firstusbank.com under the tabs “About Us” – “Investor Relations.Relations” – “USBI Policies.” The Nominating, Executive and Corporate Governance Committee is required on an annual basis to review and reassess the adequacy of its charter and recommend any changes to the full Board. Any revisions to the charter are to be made by the full Board. The Nominating, Executive and Corporate Governance Committee last reviewed and assessed the adequacy of its charter on March 11, 2015. The Nominating, Executive and Corporate Governance Committee met sevenfour times in 2011.2014.

The members of the Nominating, Executive and Corporate Governance Committee are Hardie B. Kimbrough, Chairperson, Andrew C. Bearden, Jr., Chairperson, Gerald P. Corgill, John C. Gordon, J. Lee McPhearson and Bruce N. Wilson. The Board has carefully evaluated the backgrounds of the members of the Nominating, Executive and Corporate Governance Committee and determined that such members qualify as “independent”“independent,” as defined in the applicable Nasdaq listing standardsrules and as defined in the committee’s charter.

Consideration of Director-Nominees

Criteria and Diversity

Criteria that are used by the Nominating, Executive and Corporate Governance Committee in connection with evaluating and selecting new directors include factors relating to whether the candidate would meet the definition of “independent”“independent,” as defined by the applicable Nasdaq listing standards,rules, as well as the candidate’s skills, occupation and experience in the context of the needs of the Board. The Board believes that the backgrounds and qualifications of the directors, considered as a group, should provide a significant composite mix of experience, knowledge and abilities that will allow the Board to fulfill its responsibilities.

The Nominating, Executive and Corporate Governance Committee continually reviews the qualifications and responsibilities of all directors in consideration of the Board’s overall responsibility to shareholders. Although neither the Board nor the Nominating, Executive and Corporate Governance Committee has a formal policy with regard to the consideration of diversity in identifying director nominees,director-nominees, the director nomination process is designed to ensure that the Board considers members with diverse backgrounds, including race, ethnicity, gender, education, skills and experience, with a focus on appropriate financial and other expertise relevant to the company’sUSBI’s business, and also considers issues of judgment, conflicts of interest, integrity, ethics and commitment to the goal of maximizing shareholder value. The goal of this process is to assemble a group of directors with deep, varied experience, sound judgment and commitment to the company’s success.success of USBI. For a discussion of the individual experience and qualifications of our directors, please refer to the section entitled “Proposal 1 – Election of Directors” in this Proxy Statement beginning on page 4.Statement.

Process for Identifying and Evaluating Director-Nominees

The process followed by the Nominating, Executive and Corporate Governance Committee to identify and evaluate candidates includes requests to Board members and others for recommendations, meetings from time to

time to evaluate biographical information and background material relating to potential candidates, and interviews of selected candidates by members of the Nominating, Executive and Corporate Governance Committee and the Board. Assuming that the appropriate biographical and background material discussed below is provided on behalf of candidates recommended by shareholders, the Nominating, Executive and Corporate Governance Committee will evaluate those candidates by applying substantially the same criteria and following substantially the same process as that used for candidates submitted by Board members.

Director-Nominees Proposed by Shareholders

The Nominating, Executive and Corporate Governance Committee will consider candidates recommended by shareholders for inclusion by the Board of Directors in the slate of nominees that the Board recommends to the shareholders for election. In considering whether to recommend any candidate for inclusion in the Board’s

slate of recommended director-nominees, including candidates recommended by shareholders, the Nominating, Executive and Corporate Governance Committee applies the selection criteria and follows the process described above.

Shareholders may recommend individuals for the Nominating, Executive and Corporate Governance Committee to consider as potential director candidates by submitting the following information to the Nominating, Executive and Corporate Governance Committee, c/o Corporate Secretary of United Security Bancshares, Inc., 131 West Front Street, P.O. Box 249, Thomasville, Alabama 36784:

Any such recommendation must be received at the address above not less than 120 calendar days before the first anniversary of the date that Bancshares’on which USBI’s proxy statement was released to shareholders in connection with the previous year’s annual meeting.meeting (which date for the ensuing year is November 21, 2015).

Shareholder Communications with the Board of Directors

The Board of Directors will give appropriate attention to written communications that are submitted by shareholders and will respond as the Board deems appropriate. Absent unusual circumstances or as contemplated by committee charters, the Chairperson of the Nominating, Executive and Corporate Governance Committee primarily will be responsible for monitoring communications from shareholders and providing copies or summaries of such communications to the other directors as he or she deems appropriate. Communications will be forwarded to all directors if such communications relate to substantive matters and include suggestions or comments that the Chairperson of the Nominating, Executive and Corporate Governance Committee considers important.

Shareholders and other interested parties who wish to send communications on any topic to the Board should address such communications to:

Chairperson of the Nominating, Executive and Corporate Governance Committee

c/o Corporate Secretary of United Security Bancshares, Inc.

131 West Front Street

P.O. Box 249

Thomasville, Alabama 36784

All written communications to Bancshares’USBI’s Board of Directors will be relayed to the Nominating, Executive and Corporate Governance Committee without being screened by management.

TRANSACTIONS WITH RELATED PERSONS

BancsharesUSBI recognizes that transactions between BancsharesUSBI or its subsidiaries and any of its directors or executive officers may present potential or actual conflicts of interest that are not in the best interests of BancsharesUSBI and its shareholders. Therefore, as a general matter and in accordance with Bancshares’USBI’s Code of Business Conduct and Ethics, BancsharesUSBI prefers to avoid such transactions. Nevertheless, there are situations where such transactions may be in, or may not be inconsistent with, the best interests of BancsharesUSBI and its shareholders. Therefore, BancsharesUSBI has adopted a written policy and procedures that require the Audit Committee to review and, if appropriate, to approve or ratify any such transactions.

Policy and Procedures Regarding Related Person Transactions

The Audit Committee’s Policy and Procedures With Respect to Related Person Transactions sets forth the process for reviewing, approving and ratifying transactions involving BancsharesUSBI and its subsidiaries and “related persons.” “Related persons” include directors and executive officers and their immediate family members and shareholders owning 5% or more of Bancshares’USBI’s outstanding common stock. It is Bancshares’USBI’s policy to approve and ratify transactions involving related persons only when the Board of Directors, acting through the Audit Committee, determines that the transaction in question is in, or is not inconsistent with, the best interests of BancsharesUSBI and its shareholders.

The procedures provide that, prior to entering into a related person transaction, management or the affected director or executive officer must bring the matter to the attention of a designated individual who will assess whether the matter should be considered by the Audit Committee. If a member of the Audit Committee is involved in the proposed transaction, he or she will be recused from all discussions and decisions about the transaction. To the extent that a related person transaction is not identified in advance, the terms of the transaction will be reviewed and evaluated by the Audit Committee. Only transactions that are in, or that are not inconsistent with, the best interests of BancsharesUSBI and its shareholders are approved or ratified by the Audit Committee.

Certain Transactions with Related Persons

Certain directors and executive officers of BancsharesUSBI and their family members were customers of, and had transactions with, First United Securitythe Bank in the ordinary course of business since the beginning of 2011,2013, and additional transactions likely will take place in the ordinary course of business. All outstanding loans and commitments were made in the ordinary course of business, made on substantially the same terms, including interest rates and collateral, for comparable transactions with unrelated persons, and did not involve more than the normal risk of collectibilitycollectability or present other unfavorable features.

COMPENSATION DISCUSSION AND ANALYSIS

Compensation Philosophy

We believe that the compensation of our executive officers should link rewards to business results and shareholders’ returns. Specifically, the compensation program should attract, retain and motivate the executive officers necessary for our current and long-term success and should tie executive compensation with the performance of Bancshares.USBI.

Oversight of the Compensation Program

Our Compensation Committee oversees our compensation program and approves the compensation paid to all executive officers, including the Chief Executive Officer and the two other most highly compensated executive officers during 20112014 – Mr. House, Mr. Mitchell and Mr. Elley (collectively, the “Named Executive Officers”) (our Named Executive Officers are identified in the 2011 Summary Compensation Table that appears in this Proxy Statement on page 20; included as a “Named Executive Officer” is also our former President and Chief Executive Officer, Mr. Phillips, for whom disclosure would have been provided but for the fact that he was not serving as an executive officer at the end of the 2011 fiscal year). All of the members of the Compensation Committee have been determined by the Board of Directors to qualify as “independent” under the applicable Nasdaq director independence standards.rules. The Compensation Committee operates under a written charter, a copy of which is posted on First United Security’sthe Bank’s website at http://www.firstusbank.com under the tabs “About Us” – “Investor Relations.Relations” – “USBI Policies.”

Our Compensation Committee’s responsibilities include reviewing and approving the amount, form and terms of compensation to be paid to the Named Executive Officers and assessing and making recommendations to the Board regarding executive compensation and benefit plans and programs. The Chief Executive Officer assists the Compensation Committee with determining the amount of compensation to be paid to the other executive officers but does not play a role in the final determination or approval of his own compensation determination.compensation. Our Human Resources departmentDepartment also assists the Compensation Committee with compensation decisions by providing support and data for the committee.

Compensation Consultant

The Chartercharter of the Compensation Committee grants the committee the authority to hire outside consultants to further its objectives and assist with its responsibilities. TheDuring 2014, Matthews, Young – Management Consulting (“Matthews, Young”), which has been engaged by the Compensation Committee has, in prior years to consult on various compensation matters, assisted the past, engagedCompensation Committee by continuing to review, assess and provide recommendations with respect to certain aspects of USBI’s compensation program for executive officers. In this role, Matthews, Young rendered services specifically requested by the Compensation Committee, which included reviewing with the Compensation Committee certain features of, and procedures for, the Company’s equity incentive compensation program and providing a comparative analysis of incentive awards paid to the Company’s executive officers for the 2013 fiscal year.

USBI does not have a policy that limits the services of outside consultants to assist in determining appropriatethat an executive compensation programs and amounts and may, inconsultant can perform. However, USBI has not engaged Matthews, Young for any projects other than those directed by the future, engage such consultantsCompensation Committee, as the committee deems appropriate. No such consultant is currently engaged.described above. Matthews, Young has not performed any other services for USBI.

Elements of Executive Compensation Objectives

Compensation is based on an individual’s job level, responsibilities and experience and companyCompany performance. We want to attract and retain, on a long-term basis, high caliber personnel and, to that end, provide a total compensation opportunity that is competitive in the banking industry, taking into account relative company size and performance as well as individual responsibilities and achievements.

Currently, the primary component of the total compensation for our Named Executive Officers is base salary. In some years, we have compensated our executive officers with a combination of base salary and cash incentives designed to be competitive, to align management’s incentives with business results of Bancshares and to reward not only company-wide performance but also the achievement of specific goals within areas under the control of the executive officers.

Base Salaries

Base salary is the main component of the Named Executive Officers’ compensation and is reviewed and approved by the Compensation Committee annually to determine whether the salary is appropriate. Each Named Executive Officer’s base salary is determined principally by the responsibilities required by the officer’s position,

his experience and contributions to our business and length of service in ahis position at Bancshares, USBI,

as well as individual competence and comparison to peer institutions. InBase salaries are reviewed and approved by the case ofCompensation Committee annually to determine whether the Chief Executive Officer, we further consider his overall banking experience (which includes almost twenty years of service in executive and senior management positions of banks).base salary levels are appropriate.

At its meeting in December 2011,2014, the Compensation Committee established the base salaries for the Named Executive Officers for 20122015 and determined that the following base salaries were appropriate: for Mr. House, $313,824; for Mr. Mitchell, $193,000; and for Mr. Elley, $175,000. These salaries represent no changes should be madechange from the salaries paid to the 2011 base salary amounts for 2012.Named Executive Officers in 2014.

Annual CashEquity Awards and Incentive Compensation

In some years,Our Named Executive Officers are eligible to participate in the United Security Bancshares, has madeInc. 2013 Incentive Plan (the “Omnibus Incentive Plan”), which was adopted by our Board of Directors on March 22, 2013 and approved by the company’s shareholders on May 16, 2013. The Omnibus Incentive Plan provides for the grant of incentive and nonqualified stock options, stock appreciation rights, awards of restricted stock and restricted stock units and performance compensation awards, including performance-based cash bonuses, to employees, non-employee directors and certain employees,consultants of USBI and its affiliates, including certainthe Bank.

Restricted Stock Units. Effective as of May 30, 2014, we made an award of restricted stock units (“RSUs”) to our executive officers, under our Incentive Earnings Program,including the Named Executive Officers. RSUs represent a grant valued in terms of USBI’s common stock on the grant date, but for which program links incentives to performance resultscommon stock is not actually issued at the time of the priorgrant. We entered into a Restricted Stock Unit Award Agreement (each, an “RSU Agreement”) with each recipient setting forth the terms and vesting conditions of the respective grants.

Under the terms of the RSU Agreements, our executive officers were given the opportunity to earn a predetermined number of RSUs upon the satisfaction of specific performance criteria and objectives for the 2014 fiscal year. Specifically, each RSU Agreement set forth a “threshold,” “target” and “stretch” level of performance with respect to various performance metrics and provided that the executive officer would receive an award of RSUs calculated as a stated percentage of the officer’s base salary upon achievement of the identified level or criteria with respect to each performance metric. The program is structuredearned amount, in turn, could be settled either in cash or in a number of shares of USBI’s common stock equal to motivate employeesthe earned amount divided by the closing price of a share of USBI’s common stock on the settlement date, at the discretion of the Compensation Committee. At a meeting held in February 2014, the Compensation Committee elected to achievesettle the business goalsRSUs granted for the 2014 award year in cash, in the following amounts:

The Securities and Exchange Commission requires us to disclose the value of equity-based awards, such as RSUs, as the fair value of the award on the grant date. Therefore, the amounts disclosed in the “Stock Awards” column of the Summary Compensation Table contained herein represent the “target” amount set by Bancshares and reward employeesforth in each executive officer’s RSU Agreement, which constitutes the grant date fair value of the RSUs. However, we believe that the settlement amounts listed above, which represent cash payments for achieving such goals. ForRSUs actually earned, more accurately reflect the value that the executive officers awards generally have been based on three components: Bancshares’ corporate results, First United Security’s operating results andactually received from the individual employee’s performance. Under the program, awards are expressed as a percentage of an employee’s base salary. Any payments to the executives under the Incentive Earnings Program remain discretionary with the Board of Directors.

In light of the difficult conditions in the banking industry and the general economy, no criteria for cash bonuses under our Incentive Earnings Program were established byawards. Although the Compensation Committee for 2011,has the authority under the Omnibus Incentive Plan to issue additional RSUs, it has no plans to issue additional RSUs at this time.

Stock Options. Nonqualified stock options are inherently performance-based and no cash bonuses were paid. Additionally, no criteria for cash bonuses have been established for 2012. The Compensation Committee will continue to evaluate whetheralign the establishmentinterests of such criteria for the potential payment of cash bonuses is appropriate in future years.

Salary Continuation Agreements and Director Retirement Agreements

Salary Continuation Agreements. In order to encourage members of our senior management, several years ago, we entered into salary continuation agreements with certain executive officers. The salary continuation agreements are nonqualified deferred compensation arrangements that are designed to motivate the executive officers to remain employed with Bancshares until their retirement. While the benefit amounts vary, the same terms generally apply to allthose of the agreements. Currently, Mr. Steenshareholders because the exercise price is granted at the fair market value of our common stock on the grant date, and the option has value only if the price of our common stock appreciates over time. In August 2014, we awarded to our directors and executive officers, including the Named Executive Officer who isOfficers, under the Omnibus Incentive Plan nonqualified stock options to purchase shares of our common stock.

These options had an exercise price of $8.10 per share and vested immediately upon issuance. In connection with this award, Mr. House received a partygrant of 11,000 options, Mr. Mitchell received a grant of 7,500 options and Mr. Elley received a grant of 4,250 options.

We also made an award of nonqualified stock options under the Omnibus Incentive Plan to our directors, executive officers and several other employees of the Bank effective as of February 23, 2015. These options carry an exercise price of $8.23 and vest on the first anniversary of the grant date. In connection with this award, Mr. House received a salary continuation agreement.

The salary continuation agreements promisegrant of 10,500 options, Mr. Mitchell received a grant of 6,500 options and Mr. Elley received a grant of 5,900 options. We anticipate that equity-based awards under the executive officer a benefit thatOmnibus Incentive Plan for 2015 will be paid annually for fifteen years generally beginning onmade solely in the laterform of when the executive officer reaches age 65 or when the executive officer terminates employment. The amount of Mr. Steen’s benefit was initially setstock options.

Termination and Change in September 2002 and generally is increased by 4% each year until he attains age 65. The benefit is reduced if the executive officer retires before age 65 or terminates employment due to a disability.Control Benefits

The salary continuation agreements also provide a change in control benefit. We believe that it is important to protect the financial interests of our senior management in the event of a change in control. Further, we believe that the interests of Bancshares’USBI’s shareholders will beare best served if the interests of our senior management are aligned with the shareholders’ interests. Providing change in control benefits should eliminate, or at least reduce, the reluctance of senior management to pursue potential change in control transactions that may be in the best interests of our shareholders. Accordingly, the salary continuation agreements provide the executive officers with certain benefits in the event of a change in control of Bancshares or a change in control of First United Security. If an executive officer is terminated following a change in control, we will pay the executive officer annually for fifteen years, beginning at age 65, an amount equal to the maximum benefit he would have been entitled to receive had he terminated employment at age 65.

On November 20, 2008, Bancshares and First United Security entered into an amendment to the salary continuation agreement for Mr. Steen, the purpose of which was to ensure that the terms of the salary continuation agreement comply with Internal Revenue Code Section 409A, promulgated under the American Jobs Creation Act of 2004. Internal Revenue Code Section 409A imposes significant taxes on an executive officer if he or she is paid deferred compensation that does not satisfy certain statutory and regulatory requirements. The salary continuation agreements are subject to Internal Revenue Code Section 409A. Consequently, in order for the executive officers to avoid potential negative tax consequences, we amended Mr. Steen’s salary continuation agreement to comply with the applicable Internal Revenue Code Section 409A requirements. The amendment to the salary continuation agreement does not materially change the scope or amount of benefits to which Mr. Steen is entitled but may affect the time and form of payment of such benefits. The amendment was filed as an exhibit to Bancshares’ Form 10-K for the year ended December 31, 2008.

Director Retirement Agreements. In order to encourage the members of the Board of Directors to continue to serve as directors of Bancshares, we have entered into director retirement agreements with each director, with the exception of Mr. House. The director retirement agreements are nonqualified deferred compensation arrangements that are designed to motivate the directors to serve on the Board until their retirement. The same terms generally apply to all of the agreements.

The director retirement agreements promise each director a benefit that will be paid annually for ten years generally beginning on the later of when the director reaches age 70 or when the director terminates service as a director. The amount of the benefit was initially set at $12,000 in September 2002 and is increased by 3% each year until the director reaches age 70. The benefit is reduced if the director retires before age 70 or terminates service as a director due to a disability.

Similar to the salary continuation agreements, the director retirement agreements provide a change in control benefit. For the reasons discussed above, we believe that the interests of Bancshares’ shareholders will be best served if the interests of our directors are aligned with the shareholders’ interests. Therefore, the director retirement agreements provide that, if a director is terminated following a change in control of Bancshares or a change in control of First United Security, we will pay the director annually for ten years, beginning at age 70, an amount equal to the maximum benefit he or she would have been entitled to receive had the director terminated service as a director at age 70.

On November 20, 2008, Bancshares and First United Security entered into amendments to the director retirement agreements for each director at the time, the purpose of which is to ensure that the terms of the director retirement agreements comply with Internal Revenue Code Section 409A. Similar to the salary continuation agreements, the director retirement agreements are subject to Internal Revenue Code Section 409A. Therefore, in order for the directors to avoid potential negative tax consequences, we amended the director retirement agreements to comply with the applicable Internal Revenue Code Section 409A requirements. The amendments to the director retirement agreements do not materially change the scope or amount of benefits to which the directors are entitled but may affect the time and form of payment of such benefits. The amendments were filed as exhibits to Bancshares’ Form 10-K for the year ended December 31, 2008. The director retirement agreements entered into by directors joining the Boards of Bancshares and First United Security subsequent to the November 2008 amendments comply with Section 409A.

Additional details regarding these salary continuation agreements and director retirement agreements, as well as the amounts that would be payable in the event of a termination of employment and a change in control, are further discussed below under the caption, “Potential Payments Upon Termination or Change in Control,” beginning on page 22 in this Proxy Statement.

Termination and Change in Control Benefits Under Mr. House’s Employment Agreement

Mr. House, theour President and Chief Executive Officer, is the only Named Executive Officer with an employment agreement. On December 19, 2013, USBI, the Bank and Mr. House entered into an Amended and Restated Executive Employment Agreement that replaced the original employment agreement entered into by USBI, the Bank and Mr. House on November 7, 2011, when Mr. House was hiredfirst began serving as the President and Chief Executive Officer

Bancshares, First United Security of USBI and the Bank. In addition to setting forth various terms with respect to Mr. House’s base salary, the equity compensation, perquisites and other benefits to which Mr. House entered into anis entitled, and certain restrictive covenants, the employment agreement. Details regarding theagreement contains certain termination and change in control provisions, the details of Mr. House’s employment agreementwhich are further discussed below under the caption, “Employment Agreement with Mr. House.”

Additionally, we have entered into a Change in Control Agreement with each of Mr. Mitchell and Mr. Elley, pursuant to which certain payments are required in connection with a change in control. For more information, see “Potential Payments Upon Termination or Change in Control,” beginning on page 22 in this Proxy Statement.Control” contained herein.

Perquisites and Other Benefits

We provide our Named Executive Officers with limited perquisites and other personal benefits that we believe are reasonable and consistent with our overall compensation program to better enable us to attract and retain qualified senior management. It is our belief that perquisites for executive officers should be limited in scope and value and also should be reflective of similar perquisites provided to executive officers at other regional banks of comparable size.

Perquisites provided include, in some cases, payment of cell phone fees, subscription radio fees and club dues, as well as a company-provided automobile and reimbursement of reasonable expenses in operating such automobile. Additionally, Bancshares will paythe company pays the annual premiums for a term life insurance policy with a $250,000 death benefit for Mr. House. TheHouse and currently provides Mr. House and Mr. Elley with temporary housing in Thomasville, Alabama. Otherwise, the Named Executive Officers participate in our employee benefit plans and programs on the same terms and conditions as other employees. The benefits available generally include medical and dental insurance, disability insurance and life insurance. In addition, Bancshares sponsorswe sponsor a 401(k) plan in which all eligible employees, including the Named Executive Officers, may participate.

Consideration of Prior Shareholder Advisory Vote on Executive Compensation

We provide our shareholders with the opportunity annually to vote to approve, on an advisory basis, the compensation of our Named Executive Officers (often referred to as a “say-on-pay” vote). Although the “say-on-pay” vote is advisory and non-binding, the Compensation Committee considers the outcome of the vote as part of its executive compensation planning process. At the 2014 Annual Meeting of Shareholders held on May 2, 2014, approximately 87% of the shares represented at the meeting in person or by proxy and entitled to vote on the “say-on-pay” proposal were voted in favor of the compensation of USBI’s Named Executive Officers as disclosed in the proxy statement for that meeting. USBI’s Compensation Committee considered this high level of shareholder support when determining the compensation for 2015 but did not take any actions in 2014 or to date in 2015 specifically in response to the shareholder advisory vote on executive compensation. The Compensation Committee concluded that USBI’s compensation program should continue to emphasize the objectives described herein.

COMPENSATION COMMITTEE REPORT

The Compensation Committee, comprised of independent directors, reviewed and discussed the above Compensation Discussion and Analysis with Bancshares’USBI’s management. Based on the review and discussion, the Compensation Committee recommended to Bancshares’USBI’s Board of Directors that the Compensation Discussion and Analysis be included in this Proxy Statement.

This report furnished by the Compensation Committee:

J. Lee McPhearson,Chairperson

Linda H. BreedloveAndrew C. Bearden, Jr.

Gerald P. Corgill

John C. Gordon

Howard M. WhittedA.J. Strickland, III

EXECUTIVE COMPENSATION

20112014 Summary Compensation Table

The Named Executive Officers’ compensation consists of the following elements: base salary, an annual cash incentive (in some years), retirement and other post-employment benefits, and limited perquisites and other personal benefits incidental to typical business expenses (for certain of the Named Executive Officers). The following table sets forth, for the years ended December 31, 20112014 and 2010,2013, a summary of the compensation paid to or earned by the Named Executive Officers.

Note that, as a “smaller reporting company” and pursuant to the rules of the Securities and Exchange Commission, BancsharesUSBI is providing below 2011compensation information for 2014 and 2010 compensation information2013 for Mr. House, as the President and Chief Executive Officer of BancsharesUSBI and First United Security,the Bank, and Mr. SteenMitchell and Mr. Mabowitz,Elley, as the two most highly compensated executive officers other than Mr. House who were serving as executive officers at the end of 2011. Mr. Phillips is also listed based on the compensation paid to or earned by him prior to his resignation from Bancshares and First United Security on June 30, 2011.2014.

$50,883 and $50,986, respectively. The 2013 amount presented in this column for Mr. Elley represents the grant date fair value of 1,500 shares of the Company’s common stock granted to Mr. Elley as an inducement to join the Company in September 2013, which shares were issued in January 2014.

(3)	The following table describes each component in the “All Other Compensation” column.

For Mr. House, “Other” compensation for 2014 includes the following: (i) $3,800$402 in club dues and $186 for a radio subscription service fee, and for 2013 includes $702 in club dues and $164 for a radio subscription service fee. For Mr. Mitchell, this amount represents $118 for a radio subscription service fee paid in both 2014 and 2013. For Mr. Elley, this amount represents cash payments for relocation and housing expenses and (ii) $2,500 for the reimbursement of legal fees incurred by Mr. Housea signing bonus earned in connection with the negotiationcommencement of his employment agreement, both pursuant towith the termsCompany in October 2013, $10,000 of Mr. House’s employment agreement.

For Mr. Phillips, the figures presented represent compensationwhich was paid or earned prior to or in connection with Mr. Phillips’ resignation effective June 30, 2011. “Other” compensation includes $311,2502013 and $30,000 of which was paid pursuant to the Separation Agreement and Mutual Release between Bancshares, First United Security and Mr. Phillips (see Note 6 below).in 2014.

Potential Payments Upon Termination or Change in Control

Bancshares has entered into the following agreements with Mr. Steen that require us to provide compensation and benefits to him in the event of a termination of employment or a change in control of Bancshares or First United Security.

Salary ContinuationEmployment Agreement with Mr. Steen

Under the terms of the salary continuation agreement, if Mr. Steen terminates his employment with Bancshares or First United Security as a result of his resignation, retirement, death or disability or a change in control of Bancshares or First United Security, he is entitled to be paid an annual benefit for a term of fifteen years. Such benefit generally will begin to be paid when Mr. Steen reaches normal retirement age, which is defined in the plan as age 65, or when the executive officer terminates employment, whichever is later. Mr. Steen’s potential annual benefit is based on a set amount that is increased by 4% each year until he reaches age 65. The agreement provides for benefits as follows.

Normal Retirement On or After Age 65. Upon termination of employment on or after reaching age 65, Mr. Steen is entitled to an annual benefit that will be paid for fifteen years beginning immediately following his termination. Specifically, Mr. Steen will receive the following annual retirement benefit on termination for a period of fifteen years:

Early Retirement Prior to Age 65. To the extent that Mr. Steen terminates employment prior to reaching age 65, his annual benefit is reduced based on the number of years until he reaches age 65. The early retirement benefit then is payable once he reaches age 65. For example, if Mr. Steen retired on December 31, 2011, he would receive the following annual early retirement benefit beginning at age 65 for a period of fifteen years:

Disability. To the extent that Mr. Steen terminates employment due to a disability as determined by the carrier of an insurance policy covering him or by the Social Security Administration, the maximum annual benefit that would be payable is reduced based on the number of years until he reaches age 65. The disability benefit then is payable once Mr. Steen reaches age 65. For example, if Mr. Steen terminated his employment on December 31, 2011 due to a disability, he would receive the following annual disability benefit beginning at age 65 for a period of fifteen years:

Change in Control. If Mr. Steen’s employment is terminated for any reason (other than a leave of absence) subsequent to a change in control of Bancshares or First United Security, he is entitled to receive the maximum annual benefit that would have been payable to him at age 65. The change in control benefit then is payable once Mr. Steen reaches age 65. For example, if Mr. Steen was terminated on December 31, 2011 following a change in control, he would receive the following annual change in control benefit beginning at age 65 for a period of fifteen years:

Death. If Mr. Steen dies prior to receiving his salary continuation benefit, his beneficiary generally is entitled to receive the maximum annual benefit that would have been payable at age 65 described above under “Normal Retirement On or After Age 65.” The death benefit would be payable to Mr. Steen’s beneficiary immediately following his death for a period of fifteen years.

James F. House’s Employment AgreementHouse

On December 19, 2013, Mr. House entered into an Amended and Restated Executive Employment Agreement (the “2013 Employment Agreement”) with USBI and the Bank, which became effective on January 1, 2014 and replaced the employment agreement entered into by Mr. House with USBI and the Bank on November 7, 2011, when Mr. House was hiredfirst began serving as President and Chief Executive Officer of USBI and Presidentthe Bank. A copy of Bancsharesthe 2013 Employment Agreement was included as Exhibit 10.1 to USBI’s Current Report on Form 8-K, which was filed with the Securities and First United Security, Mr. House entered into an employment agreement with Bancshares and First United Security.Exchange Commission on December 19, 2013.

The agreement’s initial term is thirty (30) months,three years, with renewal discussionsan additional year added to commence at least twelve (12) months priorthe term on each anniversary of the effective date of the agreement, unless one of the parties provides notice of its intention not to expiration.extend the term in accordance with the provisions of the agreement. The agreement provides that Mr. House will be paid and eligible for the following compensation, among other employee benefits: an annual base salary not less than $275,000;of $313,384, subject to increase by the Board of Directors; term life insurance coverage in the amount of $250,000; the use of a company-owned automobile and reimbursement of reasonable expenses in operating such automobile; temporary housing in Thomasville, Alabama; and reimbursement of ordinary and reasonable expenses incurred in the performance of his duties as Chief Executive Officer and President of BancsharesUSBI and First United Security. As an inducement to join Bancshares and First United Security,the Bank. In addition, for each year of the term of the agreement, Mr. House received a one-time grant of 5,000 fully-vested shares of Bancshares common stock and iswill be eligible to receive an annual long-term incentive award under the Omnibus Incentive Plan of up to an additional 5,000 shares of BancsharesUSBI’s common stock, during his employment upon attainmentoptions to purchase up to 10,000 shares of certain criteria to be established byUSBI’s common stock, or some combination of the Bancshares Board of Directors.foregoing. The agreement also contains non-compete and confidentiality restrictions. Specifically, Mr. House is prohibited from competing with BancsharesUSBI or First United Security

the Bank for twelve (12) monthstwo (2) years following the termination of his employment and from disclosing confidential and proprietary information for a period of three (3) years after the termination of his employment. In the event that Mr. House fails to satisfy these non-compete and non-disclosure obligations, Bancshares is entitled to any appropriate remedy to enforce the obligations.

Under the terms of the 2013 Employment Agreement, Mr. House’s employment agreement, heHouse is entitled to certain payments and benefits if he terminates employment due to his retirement, death or involuntary termination, or if his termination is related to a change in control of BancsharesUSBI or First United Security.the Bank.

In the event that Mr. House’s employment terminates due to his death or disability, or Mr. House terminates his employment for any reason other than “good reason,” he is entitled to any accrued and unpaid base salary earned through the date of termination and all vested amounts payable and vested benefits accrued under any otherwise applicable plan, policy, program or practice in which Mr. House was a participant.

If Mr. House is involuntarily terminated without “cause” or Mr. House terminates his employment for “good reason,” he is entitled to (i) a lump sum cash payment within twenty-one (21)thirty (30) days following his termination in an amount equal to the greater ofeither one (1) times his base salary then in effector the amount of the base salary that otherwise would have been payable to Mr. House for the remainder of the term and (ii) reimbursement from Bancshares for any premiums paid by Mr. House for COBRA health continuation coverage. For example, if Mr. House was terminated without “cause” or terminated his employment for “good reason” on December 31, 2011, he would have been entitledcoverage, subject to a lump sum paymentlimitations in the amount of $644,932 based on his 2011 base salary of $275,000.agreement.

In the event of a change in control, Mr. House is not entitled to any payment unless he is terminated or he terminates his employment within six (6) months following the change in control. If Bancshares terminates Mr. House is terminated without “cause” or if he terminates his employment for “good reason” during the six (6) months following a change in control, he is entitled to (i) a lump sum cash payment within thirty (30) days following his termination an amount equal to the greatertwo hundred ninety-nine percent (299%) of two (2) times the base salary or two (2) times the Annualized Compensation,his “base amount,” as defined in Section 280G(b)(3)(A) of the employment agreement,Internal Revenue Code of 1986, as reported by Bancshares, and (ii) reimbursement from Bancshares for any premiums paid by Mr. House for COBRA health continuation coverage. For example, if

Mr. House was terminated or resigned on or after a change in control that occurred on December 31, 2011, he would have been entitledamended, subject to a lump sum payment in the amount of $550,000 based on his 2011 base salary of $275,000.all applicable withholdings.

Internal Revenue Code Section 409A imposes significant taxes on an executive officer in the event that he receives deferred compensation that does not satisfy certain statutory and regulatory requirements in accordance with Internal Revenue Code Section 409A. However, it is the intent of BancsharesUSBI and First United Securitythe Bank that the amounts payable to Mr. House under the employment agreement comply with or are exempt from Section 409A.

Potential Payments Upon Termination or Change in Control

Mr. House’s 2013 Employment Agreement contains severance provisions pursuant to which Mr. House is entitled to certain payments or benefits in the event that his employment is terminated without “cause” or for “good reason.” See the discussion under “Employment Agreement with Mr. House” for additional information about these potential payments.

In addition, on May 20, 2014, USBI entered into Change in Control Agreements with certain of its executive officers (collectively, the “CIC Agreements”), including Mr. Mitchell and Mr. Elley. Each of the CIC Agreements provides for an eighteen-month period following a “change in control” (as defined in the CIC Agreements) during which each of the executive officers will be, upon experiencing a “qualifying termination of employment” (as defined in the CIC Agreements), entitled to a one-time lump sum payment by the Company in an amount equal to two hundred percent (200%) of the executive officer’s annual base salary in effect as of the date of termination, in addition to any rights and welfare benefits provided to the executive officer under any plans and programs upon termination of employment. Each of the CIC Agreements also provides that, during the employment period and for a period of two years following termination of employment, each of the executive officers will be bound by covenants not to compete and not to solicit customers or employees; provided, however, that the non-competition provisions of the CIC Agreements will only apply in the event that the executive officer is entitled to the one-time lump sum payment described above. The CIC Agreements with Mr. Mitchell and Mr. Elley are filed as Exhibits 10.2 and 10.1, respectively, to USBI’s Current Report on Form 8-K, which was filed with the Securities and Exchange Commission on May 23, 2014.

DIRECTOR COMPENSATION

In establishing director compensation, BancsharesUSBI considers the significant amount of time that directors expend in fulfilling their duties to BancsharesUSBI and the skill level required by BancsharesUSBI of members of the Board, as well as the importance of attracting and retaining qualified candidates to serve on the Board.

Fees

Compensation for the non-employee directors of BancsharesUSBI is $600 per month for service as directors and $500 per board meeting attended. The Chairperson of the Board receives an additional $750 per month. Non-employee committee members receive $250 per committee meeting attended, and the Chairpersons of the Audit Committee, the Compensation Committee and the Nominating, Executive and Corporate Governance Committee each receive an additional $150 per meeting attended. DirectorsNon-employee directors are also compensated for attending training meetings, or similar meetings, at the same level as for committee meetings and are reimbursed for reasonable travel expenses incurred in the performance of their duties.

All of the non-employee directors of BancsharesUSBI also serve as the directors of First United Security,the Bank, and they receive $400 per month for this service to First United Security.the Bank. The non-employee directors of First United Security’sthe Bank’s subsidiary, Acceptance Loan Company, Inc. (“ALC”), each receive $250 per meeting attended, with the exception of the Chairperson, who receives an additional $150 per meeting attended. The non-employee members of the Board of Directors of ALC include Bruce N. Wilson, Chairperson, Dan R. Barlow, Linda H. Breedlove, Gerald P. Corgill, James F. House and Howard M. Whitted. The non-employee directors of First United Security’sthe Bank’s subsidiary, FUSB Reinsurance, Inc., receive $250 per meeting attended. The non-employee members of the Board of Directors of FUSB Reinsurance, Inc. are William G. Harrison, Chairperson, Linda H. Breedlove, Chairperson, William G. Harrison, Jack W. Meigs, Howard M. Whitted and Bruce N. Wilson.

Director Retirement Agreements

Bancshares hasIn order to encourage the members of the Board of Directors to continue to serve as directors of USBI, we have entered into director retirement agreements with all of the non-employee directors of Bancshares. UnderUSBI, with the exception of Mr. Briggs, Ms. Cook, Mr. Miller, Ms. Smith and Dr. Strickland. The director retirement agreements are nonqualified deferred compensation arrangements that are designed to motivate the directors to serve on the Board until their retirement. The same terms generally apply to all of the agreements.

The director retirement agreements promise each retirement agreement, ifdirector a benefit that will be paid annually for ten years generally beginning on the later of the date on which the director reaches age 70 or the date on which the director terminates hisservice as a director. The amount of the benefit was initially set at $12,000 in September 2002 and is increased by 3% each year until the director reaches age 70. The benefit is reduced if the director retires before age 70 or herterminates service as a director due to a disability.

The director retirement agreements provide a change in control benefit. We believe that the interests of USBI’s shareholders will be best served if the interests of our directors are aligned with Bancshares or First United Security asthe shareholders’ interests. Therefore, the director retirement agreements provide that, if a resultdirector is terminated following a change in control of his or her resignation, retirement, death or disabilityUSBI or a change in control of Bancshares or First United Security,the Bank, we will pay the director isannually for ten years, beginning at age 70, an amount equal to the maximum benefit he or she would have been entitled to an annual benefitreceive had the director terminated service as a director at age 70.

On November 20, 2008, USBI and the Bank entered into amendments to the director retirement agreements for a termeach director at the time, the purpose of ten years.which is to ensure that the terms of the director retirement agreements comply with Internal Revenue Code Section 409A. The director retirement agreements are subject to Internal Revenue Code Section 409A. Therefore, in order for the directors to avoid potential negative tax consequences, we amended the director retirement agreements to comply with the applicable Internal Revenue Code Section 409A requirements. The amendments to the director retirement agreements do not materially

change the scope or amount of benefits to which the benefit depends ondirectors are entitled but may affect the reason fortime and form of payment of such benefits. The director retirement agreements entered into by directors joining the director’s terminationBoards of serviceUSBI and the number of years served as a director. See “Salary Continuation Agreements and Director Retirement Agreements” beginning on page 16 in this Proxy Statement under “Compensation Discussion and Analysis” and “Potential Payments Upon Termination or Change in Control” beginning on page 22 in this Proxy Statement for additional information regarding these agreements.Bank subsequent to the November 2008 amendments comply with Section  409A.

Deferral Plan

Non-employee directors may elect to defer payment of all or any portion of their First United Securityfees earned as directors of the Bank director fees under the United Security Bancshares, Inc. Non-Employee Directors’ Deferred Compensation Plan (the “Plan”“Deferral Plan”), and, beginning on. From January 1, 2012 through year-end 2014, all United Security Bancshares, Inc.USBI director fees arewere deferred under the Deferral Plan. The Deferral Plan, which was ratified by shareholders at the annual meeting held on May 11, 2004, permits non-employee directors to invest their directors’ fees and to receive the adjusted value of the deferred amounts in cash and/or shares of Bancshares’USBI’s common stock.

If the deferred amounts are invested in share units, the return is determined as if such funds had been invested in Bancshares’USBI’s common stock, and, if the deferred amounts are invested in cash, the return is calculated at an interest rate equal to the 30-Day London Interbank Offered Rate (LIBOR) plus 75 basis points. Deferred amounts generally are distributed to a director at the termination of such individual’s service as a director of Bancshares,USBI, either in a lump sum payment or in annual installment payments. All of Bancshares’ directors currently defer all of their Bancshares director fees under the Plan.

20112014 Director Compensation Table

The following table provides information regarding compensation earned by or paid to Bancshares’USBI’s non-employee directors in 2011.2014.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

The Compensation Committee consists of J. Lee McPhearson, Chairperson, Linda H. Breedlove,Andrew C. Bearden, Jr., Gerald P. Corgill, John C. Gordon and Howard M. Whitted.A. J. Strickland, III. Pursuant to the Compensation Committee’s charter, Mr. House, Chief Executive Officer and President of Bancshares,USBI, is permitted to be present at meetings during which executive compensation other than for himself is under review and consideration. No member of the Compensation Committee during 20112014 was an executive officer of another company with a board of directors that has a comparable committee on which one of our executive officers serves.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

As of March 14, 2012,6, 2015, no person was known to management to be the beneficial owner of more than 5% of Bancshares’USBI’s outstanding common stock. The following table sets forth the number and percentage of outstanding shares of Bancshares’USBI’s common stock beneficially owned as of March 14, 2012,6, 2015, by (i) the Named Executive Officers (but excluding Mr. Phillips);Officers; (ii) each director and director-nominee of Bancshares;USBI; and (iii) all current executive officers and directors of BancsharesUSBI as a group.

(5)(4)

Includes 103,572103,612 shares owned by Mr. Corgill’s spouse, with respect to which Mr. Corgill disclaims beneficial ownership. Also includes 4,124 shares owned by Dozier Hardware Company, Inc., of which Mr. Corgill is President, and 6,240740 shares owned by the Dozier Hardware Company, Inc. Profit Sharing Plan & Trust.Trust, 5,497 shares of common stock equivalents held pursuant to the United Security Bancshares, Inc. Non-Employee Directors’ Deferred Compensation Plan, with respect to which Mr. Corgill may acquire beneficial ownership within 60 days of March 6, 2015, and 1,500 shares of common stock underlying options that are exercisable within 60 days of March 6, 2015. In January 2015, Mr. Corgill pledged 79,002 shares of the Company’s common stock as collateral in connection with a modification of a loan relationship between the Bank and a business entity owned by Mr. Corgill, which shares were still pledged as of March 6, 2015. These shares are included in the amount presented for Mr. Corgill in the table set forth above.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Securities Exchange Act of 1934, as amended, requires the directors and executive officers of BancsharesUSBI and persons who own more than 10% of a registered class of Bancshares’USBI’s equity securities to file with the Securities and Exchange Commission initial reports of ownership and reports of changes in ownership of common stock of Bancshares.USBI. Directors, executive officers and greater than 10% shareholders are required by the Securities and Exchange Commission regulations to furnish Bancshares withto USBI copies of all Section 16(a) reports that they file.

To our knowledge, based solely on a review of the copies of such reports furnished to BancsharesUSBI and written representations that no other reports were required, during the fiscal year ended December 31, 2011,2014, all Section 16(a) reports applicable to itsUSBI’s directors, executive officers and greater than 10% beneficial owners were filed timely with the exception of one late Form 4 filed by Gerald P. Corgill on August 30, 2011, which related to the sale of 500 shares of Bancshares’ common stock on August 18, 2011 by the Dozier Hardware Profit Sharing Plan & Trust, the holdings of which are reported as indirect holdings of Mr. Corgill. The transaction was inadvertently not reported at the time of sale.filed.

AUDIT COMMITTEE REPORT

The Audit Committee of the Board of Directors is composed of foursix directors who are independent directors as defined under the applicable Nasdaq listing standardsrules and the Securities and Exchange Commission rules currently in effect.

The Audit Committee hereby submits the following report:

Based on the review and discussions referred to above, we recommended to the Board of Directors that the audited consolidated financial statements be included in Bancshares’USBI’s Annual Report on Form 10-K for the fiscal year ended December 31, 2011.2014.

It should be noted that management is responsible for Bancshares’USBI’s financial reporting process, including its system of internal controls, and the preparation of consolidated financial statements in accordance with accounting principles generally accepted in the United States of America. USBI’s independent registered public accounting principles. Bancshares’ independent auditors arefirm is responsible for auditing those consolidated financial statements. Our responsibility is to monitor and review this process. It is not our duty or our responsibility to conduct auditing or accounting reviews or procedures.

This report furnished by the Audit Committee:

A.J. Strickland, III,Chairperson

Andrew C. Bearden, Jr.,Chairperson

Robert Stephen Briggs

William G. Harrison

Hardie B. KimbroughJ. Lee McPhearson

Jack W. Meigs

PROPOSAL 2

RATIFICATION OF APPOINTMENT OF

INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS

At the direction of the Audit Committee, the ratification of the appointment of Carr, Riggs & Ingram, LLC (“Carr, Riggs”) as Bancshares’USBI’s independent registered public accountants for the year ending December 31, 20122015 is being presented to the shareholders for approval at the Annual Meeting. Although ratification is not required by our Bylaws or otherwise, the Board is submitting the selection of Carr, Riggs to our shareholders for ratification as a matter of good corporate practice.governance. If the selection is not ratified, the Audit Committee will consider whether it is appropriate to select another independent registered public accounting firm. Even if the selection is ratified, the Audit Committee in its discretion may select a different independent registered public accounting firm at any time during the year if it determines that such a change would be in the best interests of the companyUSBI and our shareholders.

General

The Audit Committee has approved the engagement of Carr, Riggs as Bancshares’USBI’s independent registered public accountants for the year ending December 31, 2012.2015. Carr, Riggs has served as Bancshares’USBI’s principal accountants since August 13, 2008.

A representative from Carr, Riggs is expected to be present at the Annual Meeting, will have the opportunity to make a statement if he or she desires to do so and is expected to be available to respond to appropriate questions.

Pre-Approval Policies and Procedures

The Audit Committee of the Board of Directors has adopted policies and procedures for the pre-approval of audit and permissible non-audit services performed by the independent auditor.registered public accountants. Pursuant to these policies and procedures, the Audit Committee generally is required to pre-approve the audit and permissible non-audit services performed by the independent auditorregistered public accountants in order to assure that the provision of such services does not impair the auditor’s independence. Unless a type of service to be provided by the independent auditorregistered public accountants has received general pre-approval, the service will require specific pre-approval by the Audit Committee. Any proposed services exceeding pre-approved cost levels will require specific pre-approval by the Audit Committee. On an annual basis, the Audit Committee may pre-approve specific services that are expected to be provided to BancsharesUSBI by the independent auditorregistered public accountants during the following twelve months.

Audit and Other Service Fees

The following table sets forth the aggregate fees billed to BancsharesUSBI for the audit and other services provided by Carr, Riggs for 20112014 and 2010.2013.

Audit Fees

Audit fees were for professional services rendered relating to the audit of Bancshares’USBI’s annual consolidated financial statements and the review of financial statements included in Bancshares’USBI’s Forms 10-Q. Fees for 2010 also include the audit of management’s assessment of internal control over financial reporting under Section 404 of the Sarbanes-Oxley Act.

Audit-Related Fees

Audit-related fees were for professional services rendered that are reasonably related to the performance of the audit or review of Bancshares’USBI’s consolidated financial statements and are not reported under “Audit Fees.” These fees represent the aggregate fees billed for services relating to employee benefit plan audits. All of these services were pre-approved by the Audit Committee.

Tax Fees

Tax fees represent the fees billed for services relating to tax compliance.compliance, tax advice and tax planning. All of these services were pre-approved by the Audit Committee.

All Other Fees

Other than the services reported in the categories described above,There were no other fees were billedpaid to Carr, Riggs for each of the last two fiscal years by Carr, Riggs.2014 or 2013.

Vote Required; Board Recommendation

The affirmative vote of a majority of the shares represented at the Annual Meeting in person or by proxy and entitled to vote on this matter is needed to ratify the appointment of Carr, Riggs as Bancshares’USBI’s independent registered public accountants for the year ending December 31, 2012.2015. Unless instructed to the contrary, the shares represented by proxy will be voted FOR this proposal.

THE BOARD RECOMMENDS THAT YOU VOTEFOR THE RATIFICATION OF THE APPOINTMENT OF CARR, RIGGS AS BANCSHARES’USBI’S INDEPENDENT REGISTERED PUBLIC ACCOUNTANTS FOR THE YEAR ENDING DECEMBER 31, 2012.2015.

PROPOSAL 3

ADVISORY APPROVAL OF EXECUTIVE COMPENSATION

The Dodd-Frank Wall Street Reform and Consumer Protection Act, enacted in July 2010, requires that companies provide shareholders with the opportunity to vote to approve, on a non-binding, advisory basis, the compensation of their named executivesexecutive officers in accordance with the compensation disclosure rules of the Securities and Exchange Commission. Although Bancshares, dueWe intend to its current statushold such an advisory vote on the compensation of our Named Executive Officers, commonly known as a “smaller reporting company,” is not yet subject to“say-on-pay” vote, each year in connection with our annual meeting of shareholders until the rules requiringnext vote on the frequency of the “say-on-pay” vote or until our Board of Directors otherwise determines that a different frequency for this advisory vote is in the Board has nonetheless elected to include this proposal to solicitbest interests of our shareholders’ feedbackshareholders. The next advisory vote on our current executive compensation program.the frequency of “say-on-pay” votes will occur no later than 2017.

As described in detail under the heading “Compensation Discussion and Analysis,” we believe that the compensation of our executive officers should link rewards to business results and shareholders’ returns. We believe that our compensation program should attract, retain and motivate the executive officers necessary for our current and long-term success and should provide the executive officers with a stake in the future of BancsharesUSBI that corresponds to the stake of each of our shareholders.

The vote on this resolution is not intended to address any specific element of compensation; rather, the vote relates to the compensation of our Named Executive Officers, as described in this Proxy Statement in accordance with the compensation disclosure rules of the Securities and Exchange Commission. The vote is advisory, which means that the vote is not binding on Bancshares,USBI, our Board of Directors or the Compensation Committee of the Board of Directors. To the extent that there is any significant vote against our Named Executive Officer compensation as disclosed in this Proxy Statement, the Compensation Committee will evaluate whether any actions are necessary to address the concerns of shareholders.

The affirmative vote of a majority of the shares represented at the Annual Meeting in person or by proxy and entitled to vote on this matter is required for the adoption of this Proposal, the results of which will be non-binding and advisory in nature.

Accordingly, pursuant to Section 14A of the Securities Exchange Act of 1934, as amended, we ask our shareholders to vote on the following resolution at the Annual Meeting:

“RESOLVED, that Bancshares’USBI’s shareholders approve, on an advisory basis, the compensation of the Named Executive Officers, as disclosed in Bancshares’USBI’s Proxy Statement for the 20122015 Annual Meeting of Shareholders pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the Compensation Discussion and Analysis, the 20112014 Summary Compensation Table and the other related tables and disclosure.”

THE BOARD RECOMMENDS ATHAT YOU VOTEFOR THE APPROVAL OF THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS, AS DISCLOSED IN THIS PROXY STATEMENT.

SHAREHOLDER PROPOSALS FOR 20132016 ANNUAL MEETING

If any shareholder wishes to present a proposal to be included in the proxy materials for Bancshares’ 2013USBI’s 2016 Annual Meeting of Shareholders, the shareholder must comply with applicable securities regulations, including providing adequate notice to Bancshares.USBI. Such proposals must be received at Bancshares’USBI’s executive offices on or before December 4, 2012November 21, 2015 in order to be considered for inclusion in Bancshares’USBI’s proxy materials relating to such meeting.

A shareholder must notify BancsharesUSBI before February 17, 20134, 2016 of a proposal for the 20132016 Annual Meeting of Shareholders that the shareholder intends to present other than by inclusion in Bancshares’USBI’s proxy materials. If BancsharesUSBI does not receive such notice prior to February 17, 2013,4, 2016, proxies solicited by the Board of Directors of BancsharesUSBI will be deemed to have conferred discretionary authority to vote upon any such matter.

Any proposal must be submitted in writing, by certified mail-return receipt requested, to the following address:

Beverly J. Dozier, Secretary

United Security Bancshares, Inc.

131 West Front Street

Post Office Box 249

Thomasville, Alabama 36784

OTHER MATTERS

We do not know of any matters to be presented for action at the Annual Meeting other than those set forth in the notice of the Annual Meeting and discussed in this Proxy Statement.

BancsharesUSBI will furnish to shareholders without charge, upon written request, a copy of Bancshares’USBI’s Annual Report on Form10-K, including the accompanying financial statements and schedules, required to be filed with the Securities and Exchange Commission for the year ended December 31, 2011.2014. Copies of the exhibits to the Form 10-K also will be available upon request. Requests should be made to:

Beverly J. Dozier, Secretary

United Security Bancshares, Inc.

131 West Front Street

Post Office Box 249

Thomasville, Alabama 36784

YOUR VOTE IS IMPORTANT! Annual Meeting Materials are available on-line at: http://www.cfpproxy.com/4328. You can vote in one of four ways: 1. Via the Internet at http://www.rtcoproxy.com/usbi and follow the instructions. or 2. Call toll free 1-855-362-6710 on a Touch-Tone Phone. There is NO CHARGE to you for this call. or 3. Mark, sign and date your proxy card, and fax it to (334) 636-9606. or 4. Mark, sign and date your proxy card, and return it promptly in the enclosed envelope.q  PLEASE SEE REVERSE SIDE FOR VOTING INSTRUCTIONS REVOCABLE PROXY UNITED SECURITY BANCSHARES, INC. ANNUAL MEETING OF SHAREHOLDERS May 9, 2012 2:00 p.m. Central Daylight Time THIS PROXY IS SOLICITED ON BEHALF OFFOLD ALONG THE BOARD OF DIRECTORS The undersigned hereby appoints Hardie B. Kimbrough and James F. House, and each of them, as proxies for the undersigned, or such other persons as the Board of Directors of United Security Bancshares, Inc. (“Bancshares”) may designate, with full power of substitution, to represent and act for and in the name and stead of the undersigned and to vote all of the shares of Common Stock of Bancshares that the undersigned is entitled to vote at the 2012 Annual Meeting of Shareholders of Bancshares to be held on May 9, 2012 and at any and all adjournments or postponements thereof. PLEASE COMPLETE, DATE, SIGNPERFORATION, DETACH AND MAIL THIS PROXY CARD PROMPTLYRETURN THE BOTTOM PORTION IN THE ENCLOSED POSTAGE-PAID ENVELOPE, OR VOTE YOUR PROXY VIA THE INTERNET, TELEPHONE OR FAX PER INSTRUCTIONS BELOW. Á Á (Continued, and to be marked, dated and signed, on the other side) FOLD AND DETACH HERE UNITED SECURITY BANCSHARES, INC. — ANNUAL MEETING, MAY 9, 2012 4328ENVELOPE.   q

PLEASE MARK VOTES AS IN THIS EXAMPLE REVOCABLE PROXY UNITED SECURITY BANCSHARES, INC. Annual Meeting of Shareholders MAY 9, 2012 The Board of Directors recommends a vote FOR all nominees. With- For All For hold Except The election of all of the nominees listed below to serve directors until the 2013 Annual Meeting of Shareholders until their successors shall be elected and qualified. Nominees: (04) John C. Gordon (08) J. Lee McPhearson (01) Andrew C. Bearden, Jr. (05) William G. Harrison (09) Jack W. Meigs (02) Linda H. Breedlove (06) James F. House (10) Howard M. Whitted (03) Gerald P. Corgill (07) Hardie B. Kimbrough (11) Bruce N. Wilson INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, MARK “FOR ALL EXCEPT,” AND WRITE THAT NOMINEE’S NAME OR NUMBER IN THE SPACE PROVIDED BELOW. The Board of Directors recommends a vote FOR the ratification of independent registered public accountants. 2. The ratification of the appointment of Carr, Riggs & Ingram, LLC as independent registered public accountants for the year ending December 31, 2012. For Against Abstain The Board of Directors recommends a vote FOR the advisory approval of Bancshares’ executive compensation. 3. The advisory approval of Bancshares’ executive compensation. For Against Abstain THIS PROXY WILL BE VOTED IN ACCORDANCE WITH INSTRUCTIONS GIVEN BY THE SHAREHOLDER. IF NO INSTRUCTIONS ARE GIVEN, THIS PROXY WILL BE VOTED “FOR” PROPOSALS 1, 2 AND 3. Mark here if you plan to attend the meeting. Mark here for address change and note change below. Please be sure to date and sign this proxy card in the box below. Date Sign above Co-holder (if any) sign above