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:

FIRST USUNITED SECURITY BANCSHARES, INC.

(Name of Registrant as Specified in its Charter)

N/A

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 20152017 Annual Meeting of Shareholders of United SecurityFirst US Bancshares, Inc. (“USBI”(the “Company”) at 10:00 a.m., Central Time, on Friday,Wednesday, April 24, 2015,26, 2017, at Alabama Southern Community College, 30755 Highway 43 South,the Thomasville Civic Center, 559 West Front Street, Thomasville, Alabama 36784.

We have enclosed a notice of the meeting, a proxy statement, a proxy card and the Annual Report to Shareholders for 20142016 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 card 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 USBIthe Company or by a later vote via the Internet or by telephone at any time before the proxy is voted.

Sincerely,

Sincerely, 

Andrew C. Bearden, Jr.

Chairperson of the Board

James F. House

President and Chief Executive Officer

March 20, 2015

FIRST USUNITED 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

April 24, 201526, 2017

TO THE SHAREHOLDERS OF UNITED SECURITYFIRST US BANCSHARES, INC.:

United Security

First US Bancshares, Inc. (“USBI”(the “Company”) will hold its 20152017 Annual Meeting of Shareholders (the “Annual Meeting”) at Alabama Southern Community College, 30755 Highway 43 South,the Thomasville Civic Center, 559 West Front Street, Thomasville, Alabama 36784, on Friday,Wednesday, April 24, 2015,26, 2017, at 10:00 a.m., Central Time, for the following purposes:

The Board of Directors has fixed the close of business on March 5, 20157, 2017 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 USBIthe Company will be available and open for examination by any shareholder of USBIthe Company 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 about the Annual Meeting, including directions to attend the Annual Meeting, can be found at the following website: www.edocumentview.com/USBI.FUSB. 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 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 USBIthe Company 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

March 20, 201522, 2017

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD ON APRIL 24, 2015: USBI’S26, 2017: THE COMPANY’S PROXY STATEMENT AND 20142016 ANNUAL REPORT ARE AVAILABLE AT www.edocumentview.com/USBI.

PROXY STATEMENT

FUSBTABLE OF CONTENTS.

PROXY STATEMENT

TABLE OF CONTENTS

i

FIRST USUNITED SECURITY BANCSHARES, INC.

131 West Front Street

Post Office Box 249

Thomasville, Alabama 36784

(334)636-5424

PROXY STATEMENT

FOR THE

20172015 ANNUAL MEETING OF SHAREHOLDERS

TO BE HELD ON APRIL 24, 201526, 2017

INTRODUCTION

This Proxy Statement is furnished on or about March 20, 201522, 2017 by United SecurityFirst US Bancshares, Inc. (“USBI”(the “Company”) to the holders of common stock of USBIthe Company in connection with the 20152017 Annual Meeting of Shareholders, and any adjournments or postponements thereof, to be held on Friday,Wednesday, April 24, 2015,26, 2017, at 10:00 a.m., Central Time, at Alabama Southern Community College, 30755 Highway 43 South,the Thomasville Civic Center, 559 West Front Street, Thomasville, Alabama 36784 (the “Annual Meeting”). The matters to be considered and acted upon are:

The Board of Directors of USBIthe Company 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 USBIthe Company or by a later vote via the Internetinternet or by telephone. We must, however, actually receive the written notice,later-dated proxy card or later Internetinternet 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 the option of an annual non-binding advisory vote on the compensation of our named executive officers (Proposal 4) – 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. You must follow the instructions for voting your shares that you receive from your broker, bank or other nominee. Please refer to the section entitled “Voting Shares Held in ‘Street‘Street Name’” for more information about how to vote your shares.

USBIThe Company 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. USBIThe Company 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 5, 2015.7, 2017. Only shareholders as of this date are eligible to vote at the Annual Meeting. At the close of business on March 5, 2015,7, 2017, there were 6,043,2926,055,293 shares of common stock of USBI,the Company, par value $0.01 per share, 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 USBI’sthe Company’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, then 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 USBIthe Company 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, 20152017 (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. Proposals 3 and 4 are non-binding advisory votes regarding executive compensation. Proposal 3 calls for the advisory approval of USBI’sthe Company’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. Although there is no voting standard directly applicable to Proposal 4 (advisory vote on frequency of say-on-pay vote), the option of “every year,” “every two years” or “every three years” that receives the highest number of votes cast will be considered the frequency that has been approved by the shareholders on an advisory basis.

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”“abstentions”), with respect to each item submitted for shareholder 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, 20152017 (Proposal 2) and the advisory approval of USBI’sthe Company’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. Abstentions will not affect the outcome of the advisory vote on the frequency of the say-on-pay vote (Proposal 4).

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 non-binding advisory approval of USBI’svotes regarding the Company’s executive compensation (Proposal 3)(Proposals 3 and 4).

In the past,Under applicable law, if you heldhold your shares in “street name,”name” and you diddo not indicate to your broker, bank or other nominee how you wantedwant your shares to be voted in the election of directors your broker, bank(Proposal 1) 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 (Proposal 3)matters (Proposals 3 and 4), then 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 directorsdirectors or with respect to the advisory approval of executive compensation matters, your shares willwill not be voted for any director-nominee,director nominee, the executive compensation matters or on any other proposal with 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 with respect toin determining the outcome of the non-binding advisory approval ofvotes regarding executive compensation (Proposal 3)(Proposals 3 and 4). 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, 20152017 (Proposal 2); therefore, there should be no broker non-votes with respect to this item.

PROPOSAL 1

ELECTION OF DIRECTORS

USBI’s

The Company’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. There are currently fifteen (15) directors serving on the Board. However, two of our current directors have reached the mandatory retirement age set forth in the Company’s bylaws and therefore will not stand for reelection at the Annual Meeting. As a result, only the thirteen (13) remaining members of our Board and,will stand for reelection at a meeting on February 27, 2015, the Board of Directors voted to maintain the current size of the Board following the Annual Meeting. The Executive, Nominating Executive and Corporate Governance Committee and the current Board of Directors believehave both determined that a Board of Directors consisting of fifteen (15)thirteen (13) persons is practical and efficient at this point in time.

Based on the nominations of the Executive, Nominating Executive and Corporate Governance Committee, the Board of Directors recommends that the shareholders elect the fifteen (15) director-nomineesthirteen (13) director nominees named below to hold office until the 20162018 Annual Meeting of Shareholders of USBIthe Company or until their successors are elected and qualified. All of the nominees currently serve as directors. Unless “Withhold” is noted as to all or some of the nominees, proxies will be voted at the Annual Meeting FOR the election of the fifteen (15)thirteen (13) nominees to the Board of Directors. Shareholders may not vote for a greater number of persons than the number of nominees named.THEBOARD RECOMMENDS THAT YOU VOTEFOR THE ELECTION OF THE FIFTEEN (15)THIRTEEN (13) 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, then the shares that would otherwise be voted for that person may be voted for the election of a substitute person recommended by the Board of Directors.

The following provides certain biographical information about the individuals who have been nominated for election as directors of USBI.the Company. Each of the nominees currently serves as a director of USBI.the Company. 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.

Subsequent to

Following the Annual Meeting, USBI,the Company, as the sole shareholder of First US Bank USBI’s banking subsidiary (the “Bank”), intends to re-electreelect all of the newly electednewly-elected directors of USBIthe Company as directors of the Bank.

Information regarding the executive officers of USBIthe Company who are not directors is also provided below.

Information About Director-NomineesDirector Nominees

Gerald P. Corgill Director since 1985 Age 73		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, provide him with a wide range of knowledge on topics important to business, which contributes greatly to the composition of the Board of Directors.
John C. Gordon Director since 1997 Age 5759		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’sGordon’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 6870		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 thePresident and Chief Executive Officer and sole owner of Bedsole Dry Goods, a retail chain consisting of department stores and variety stores.   The Board of Directors believes that Mr. Harrison’sHarrison’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.

J. Lee McPhearson Director since 2009 Age 6163		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’sMcPhearson’s experience as a legal practitioner, which involves some representation and advising of business entities, as well as his knowledge and understanding of the communities served by USBIthe Company and the Bank gained through his time on the bench, 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 USBIthe Company and the Bank.
Jack W. Meigs Director since 1997 Age 5759		Mr. Meigs has served as Circuit Judge for the Fourth Judicial CircuitCircuit of the State of Alabama since 1991.from 1991 until his retirement in April 2016. He is currently engaged in the private practice of law.   The Board of Directors believes that Mr. Meigs’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 businesses, which contributes greatly to the composition of the Board of Directors.

Howard M. Whitted Director since 1985 Age 7072		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’sWhitted’s general business experience and, specifically, his experience in the real estate and forestry industry, provideprovides valuable insight to the Board of Directors regarding land and timber valuations and market conditions, which are important to the business of USBIthe Company and the Bank.
Bruce N. Wilson Director since 1997 Age 6062		Mr. Wilson is athe senior partnermember 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’sWilson’s experience and understanding of these issues enable him to provide valuable insight to the Board of Directors.

Information About Executive Officers Who Are Not Also Directors

Eric H. Mabowitz Age 56		Mr. Mabowitz currently serves as Executive Vice President, Retail Division, Branch Administrator and Director of Community Lending of the Bank. Mr. Mabowitz joined the 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 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 50		Mr. Maughan has served as Executive Vice President, Commercial Division, and Senior Lender of the Bank since October 2010. Mr. Maughan has served in various executive level positions in the financial services industry, including Executive Vice President and Regional President of Capstone Bank from 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 with SouthTrust Bank/Wachovia Bank.
David L. Saylors Age 70		Mr. Saylors joined the Bank in August 2012 and currently serves as Executive Vice President, Director of Human Resources. Prior to his employment with the Bank, Mr. Saylors served as Senior Vice President and 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 Marion Military Institute in Marion, Alabama; and Senior Vice President and Director of Human Resources of The Peoples Bank and Trust in Selma, Alabama from August 2000 until December 2007.
Beverly J. Daniel Matheson, IIIDozier Age 57		Mr. Matheson has served as Investment Officer of 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 USBIthe Company and Senior Vice President, Executive Administration, of the Bank. Ms. Dozier has served the Bank in numerous capacities since 1984, including working as a loan officer and mortgage originator.

CORPORATE GOVERNANCE

USBI

The Company is committed to having sound corporate governance principles. Operating in accordance with such principles is essential to running USBI’sthe Company’s business effectively and to maintaining USBI’sthe Company’s integrity in the marketplace. USBI’sThe Company’s Board has adopted a Code of Business Conduct and Ethics that sets forth basic principles to guide USBI’sthe Company’s and the 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. USBIWe 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 USBI’sthe Company’s Board independence standards, the Board and committee structure, the director nominationdirector-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 USBI’sthe Company’s common stock is listed (“Nasdaq”), requires that a majority of USBI’sthe Company’s Board members be “independent.” Accordingly, because the Board of Directors currently has fifteen (15) members, at least eight (8) of the directors must be independent. Following the Annual Meeting, after which the Company will have thirteen (13) members, at least seven (7) of the directors must be independent. In accordance with Nasdaq’s listing rules, a director is not considered to be independent unless the Board determines that the director has no relationship with USBIthe Company or its subsidiaries (either directly or as a partner, shareholder or officer of an organization that has a relationship with USBIthe Company 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 Executive, Nominating Executive and Corporate Governance Committee also must meet the independence tests in the applicable Nasdaq listing rules and the federal securities laws.

The Board has determined that none of the directors standing for re-election,reelection, with the exception of Mr. House, has any material relationship with USBIthe Company or any of its subsidiaries (either directly or as a partner, shareholder or officer of an organization that has a relationship with USBIthe Company 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 USBIthe Company 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 USBIthe Company and the Bank.

While conducting its review of director independence, the Board of Directors specifically considered the relationship between USBIthe Company and Wilson & Drinkard, of which Mr. Wilson is athe senior partner.member. Wilson & Drinkard is a law firm that has provided legal services to USBIthe Company and its subsidiaries. USBI’ssubsidiaries in the past. The Company’s fee arrangement with Wilson & Drinkard is negotiated on the same basis and is subject to the same terms and conditions as arrangements with other outside legal counsel for similar types of legal work. During 2014, USBI paid $540 in2016, the Company did not pay any legal fees to Wilson & Drinkard. Based on this review, the Board concluded that USBI’sthe Company’s relationship with Wilson & Drinkard does not interfere with Mr. Wilson’s exercise of independent judgment in carrying out the responsibilities of a director.

Company Leadership Structure

The business of USBIthe Company 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 USBIthe Company by exercising its business judgment to act in what each director reasonably believes to be the best interests of USBIthe Company and its shareholders. Leadership is

important to the effective operation of the Board for the benefit of USBI.the Company. The role of the Chairperson includes providing continuous feedback on the direction, performance and strategy of USBI,the Company, 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 USBI.the Company.

The roles of Chief Executive Officer and Chairperson of the Board have been separated since USBIthe Company became a publicly tradedpublicly-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 USBI’sthe Company’s risk management process is the responsibility of the Audit Committee of the Board of Directors.

USBI

The Company 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 USBI’sthe Company’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 USBI’sthe Company’s compensation policies and practices, including executive compensation. The Executive, 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 scheduledregularly-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 USBIthe Company 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 2014,2016, the Board of Directors of USBIthe Company met twelve12 times in regularly scheduled meetings.regularly-scheduled meetings and held one special meeting. 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 during the year.

Directors are encouraged but not required to attend the Annual Meeting of Shareholders each year. All of the then-current directors attended USBI’s 2014the Company’s 2016 Annual Meeting of Shareholders held on May 2, 2014.April 27, 2016.

Audit Committee

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

the Company’s auditing, accounting and financial reporting processes. The Audit Committee operates under a written charter, a copy of which is posted on the Bank’s website at http://www.firstusbank.com under the tabs “About Us” – “Investor Relations” – “USBI“FUSB 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, 2015.15, 2017. The Audit Committee met tenfive times during 2014.2016. The Audit Committee Report appears later in this Proxy Statement.

Certain Nasdaq listing rules and the federal securities laws require that at least one member of the Audit Committee must 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., and 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 tradedpublicly-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 current members of the Audit Committee are A.J.A. J. Strickland, III, Chairperson, Andrew C. Bearden, Jr., Robert Stephen Briggs, Gerald P. Corgill, William G. Harrison, J. Lee McPhearson and Jack W. Meigs.Meigs and Donna D. Smith. Following the Annual Meeting, at which Dr. Strickland and Mr. Corgill will not stand for reelection, the Board anticipates that the Audit Committee will consist of the remaining current members of the Audit Committee. The Board has carefully evaluated the backgrounds of the members of the Audit Committee and determined that such members qualify as “independent,” as defined in the applicable Nasdaq listing rules and as defined in the committee’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 USBI’s and the Bank’sCompany’s executive officers and administers USBI’sthe Company’s equity compensation 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. The Compensation Committee operates under a written charter, a copy of which is posted on the Bank’s website at http://www.firstusbank.com under the tabs “About Us” – “Investor Relations” – “USBI“FUSB 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, 2015.15, 2017. The Compensation Committee met tensix times in 2014.2016. The Compensation Committee Report appears later in this Proxy 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 USBI’sthe Company’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 incentivize risks that are “reasonably likely to have a material adverse effect” on USBI.the Company. As a result of this process, the Compensation Committee concluded and informed the Board that, based on USBI’sthe Company’s current compensation programs, plans and practices, there are no such risks.

The current members of the Compensation Committee are J. Lee McPhearson,Donna D. Smith, Chairperson, Andrew C. Bearden, Jr., Gerald P. Corgill,Robert Stephen Briggs, Sheri S. Cook, John C. Gordon, J. Lee McPhearson and A. J. Strickland, III. Following the Annual Meeting, at which Dr. Strickland will not stand for reelection, the Board anticipates that the Compensation Committee will consist of the remaining current members of the Compensation Committee. The Board has carefully evaluated the backgrounds of the members of the Compensation Committee and determined that such members qualify as “independent,” as defined in the applicable Nasdaq listing rules and as defined in the committee’s charter.

Executive, Nominating Executive and Corporate Governance Committee

Among other responsibilities, the Executive, 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 USBI.the Company. The Executive, Nominating Executive and Corporate Governance Committee operates under a written charter, a copy of which is posted on the Bank’s website at http://www.firstusbank.com under the tabs “About Us” – “Investor Relations” – “USBI“FUSB Policies.” The Executive, 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 Executive, Nominating Executive and Corporate Governance Committee last reviewed and assessed the adequacy of its charter on March 11, 2015.15, 2017. The Executive, Nominating Executive and Corporate Governance Committee met four times in 2014.2016.

The members of the Executive, Nominating Executive and Corporate Governance Committee are Andrew C. Bearden, Jr., Chairperson, Gerald P. Corgill,Sheri S. Cook, John C. Gordon, J. Lee McPhearson, Donna D. Smith, A. J. Strickland, III and Bruce N. Wilson. Following the Annual Meeting, at which Dr. Strickland will not stand for reelection, the Board anticipates that the Executive, Nominating and Corporate Governance Committee will consist of the remaining current members of the Executive, Nominating and Corporate Governance Committee. The Board has carefully evaluated the backgrounds of the members of the Executive, Nominating Executive and Corporate Governance Committee and determined that such members qualify as “independent,” as defined in the applicable Nasdaq listing rules and as defined in the committee’s charter.

Consideration of Director-NomineesDirector Nominees

Criteria and Diversity

Criteria that are used by the Executive, 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,” as defined by the applicable Nasdaq listing 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 Executive, 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 Executive, 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 USBI’sthe Company’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 success of USBI.the Company. For a discussion of the individual experience and qualifications of our directors, please refer to “Proposal 1 – Election of Directors” in this Proxy Statement.

Process for Identifying and Evaluating Director-NomineesDirector Nominees

The process followed by the Executive, 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 Executive, 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 Executive, 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 Director-NomineesNominees Proposed by Shareholders

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

Shareholders may recommend individuals for the Executive, Nominating Executive and Corporate Governance Committee to consider as potential director candidates by submitting the following information to the Executive, Nominating Executive and Corporate Governance Committee, c/o Corporate Secretary of United SecurityFirst US 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 on which USBI’sthe Company’s proxy statement was released to shareholders in connection with the previous year’s annual meeting, (whichwhich date for the ensuing year is November 21, 2015).22, 2017.

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 Executive, 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 Executive, 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 Executive, Nominating Executive and Corporate Governance Committee

c/o Corporate Secretary of United SecurityFirst US Bancshares, Inc.

131 West Front Street

P.O. Box 249

Thomasville, Alabama 36784

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

TRANSACTIONS WITH RELATED PERSONS

USBI

The Company recognizes that transactions between USBIthe Company 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 USBIthe Company and its shareholders. Therefore, as a general matter and in accordance with USBI’sthe Company’s Code of Business Conduct and Ethics, USBIthe Company 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 USBIthe Company and its shareholders. Therefore, USBIthe Company 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 USBIthe Company 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 USBI’sthe Company’s outstanding common stock. It is USBI’sthe Company’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 USBIthe Company 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 USBIthe Company and its shareholders are approved or ratified by the Audit Committee.

Certain Transactions with Related Persons

Certain directors and executive officers of USBIthe Company and their family members wereare customers of, and have had transactions with, the Bank in the ordinary course of business, since the beginning of 2013, and additional transactions likely will take place in the ordinary course of business. All outstanding loans and commitments wereto date have been made in the ordinary course of business madeand on substantially the same terms, including with respect to interest rates and collateral, as for comparable transactions with unrelated persons, and didhave not involveinvolved more than the normal risk of collectability or presentpresented 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 USBI.the Company.

Oversight of the Compensation Program

Our

The 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 compensatedhighly-compensated executive officers during 20142016 – Mr. House, Mr. Mitchell and Mr. Elley (collectively, the “Named Executive Officers”). 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 rules. The Compensation Committee operates under a written charter, a copy of which is posted on the Bank’s website at http://www.firstusbank.com under the tabs “About Us” – “Investor 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. Our Human Resources Department also assists the Compensation Committee with compensation decisions by providing support and data for the committee.

Compensation Consultant

The charter of the Compensation Committee grants the committee the authority to hire outside consultants to further its objectives and assist with its responsibilities. During 2014,2016, Matthews, Young – Management Consulting& Associates, Inc. (“Matthews Young”), which has been engaged by the Compensation Committee in prior years to consult on various compensation matters, assisted the Compensation Committee by continuing to review, assess and provide recommendations with respect to certain aspects of USBI’sthe Company’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 awardscompensation paid to the Company’s directors and executive officers for the 20132016 fiscal year.year compared to other institutions in the Company’s peer group.

USBI

The Company does not have a policy that limits the services that an executive compensation consultant can perform. However, USBIthe Company has not engaged Matthews Young for any projects other than those directed by the Compensation Committee, as described above. Matthews Young has not performed any other services for USBI.the Company.

Elements of Executive Compensation

Compensation is based on an individual’s job level, responsibilities and experience and Company 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.

Base Salaries

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 his position at USBI,

the Company, as well as individual competence and comparison to peer institutions. Base salaries are reviewed and approved by the Compensation Committee annually to determine whether the base salary levels are appropriate.

At its meeting in December 2014,November 2016, the Compensation Committee established the base salaries for the Named Executive Officers for 20152017 and determined that the following base salaries were appropriate: for Mr. House, $313,824;$330,000; for Mr. Mitchell, $193,000;$207,000; and for Mr. Elley, $175,000.$207,000. These salaries represent no change froman increase of 0.4%, 3.8% and 3.8%, respectively, over the salaries paid to the Named Executive Officers in 2014.2016.

Equity Awards and Incentive Compensation

Our Named Executive Officers are eligible to participate in the United Security Bancshares, Inc. 2013 Incentive Plan (the “Omnibus Incentive Plan”), which was adopted by our Board of Directors on March 22, 2013 and approved by the company’sour 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 consultants of USBIthe Company and its affiliates, including the Bank.

Restricted Stock Units. Effective as of May 30, 2014, we made an award of restricted

We awarded nonqualified stock units (“RSUs”)options to our executive officers, including the Named Executive Officers. RSUs represent a grant valuedOfficers in terms of USBI’s common stock on the grant date, but for which common stock is not actually issued at the time of the grant. We entered into a Restricted Stock Unit Award Agreement (each, an “RSU Agreement”) with each recipient setting forth the termsboth 2015 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 earned amount, in turn, could be settled either in cash or in a number of shares of USBI’s common stock equal to the 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 settle the RSUs 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 forth 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 RSUs actually earned, more accurately reflect the value that the executive officers actually received from the awards. Although the Compensation Committee 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.2016. Nonqualified stock options are inherently performance-based and align the interests of the executive officers with those of the shareholders 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,

On February 23, 2015, we awarded nonqualified options to purchase shares of our common stock to our directors and executive officers, including the Named Executive Officers, underand several other employees of the Omnibus Incentive PlanBank. These options had an exercise price of $8.23 per share and vested one year after the date of grant, or February 23, 2016. In connection with this award, Mr. House received a grant of 10,500 options, Mr. Mitchell a grant of 6,500 options and Mr. Elley a grant of 5,900 options.

On February 24, 2016, we awarded nonqualified stock options to purchase shares of our common stock.

stock to our directors and executive officers, including the Named Executive Officers, and several other employees of the Bank. These options had an exercise price of $8.10$8.30 per share and vested immediately upon issuance.share. Options issued to executive officers in 2016 vest in equal increments on the first three anniversaries of the date of grant. In connection with this award, Mr. House received a grant of 11,000 options, Mr. Mitchell received a grant of 7,5006,800 options and Mr. Elley received a grant of 4,2506,100 options.

We also made an award

On February 22, 2017, we awarded nonqualified options to purchase shares of nonqualifiedour common stock options under the Omnibus Incentive Plan to our directors, executive officers, and several other employees ofincluding the Bank effective as of February 23, 2015.Named Executive Officers. These options carryhave an exercise price of $8.23$14.11 per share and vest in equal increments on the first anniversarythree anniversaries of the grant date.date of grant. In connection with this award, Mr. House received a grant of 10,50011,000 options, Mr. Mitchell received a grant of 6,5007,000 options and Mr. Elley received a grant of 5,9007,000 options. We anticipate that equity-based awards under

2016 Cash Incentive Program

During 2016, each of the Omnibus Incentive PlanNamed Executive Officers participated in a cash incentive program for 2015 will be made solelycertain executive officers and key employees of the Company and its subsidiaries designed to incentivize the achievement of specified short-term performance criteria. Under the cash incentive program, each Named Executive Officer had the opportunity to earn a one-time cash payment equal to a predetermined percentage of his 2016 base salary, with the earned amount based on the level of performance with respect to certain corporate objectives applicable to the Company and the Bank, in the formcase of stock options.Mr. House and Mr. Elley, or ALC, in the case of Mr. Mitchell. For Mr. House and Mr. Elley, the cash incentive payment was based on the Company’s pre-tax income and return on average assets and the level of decrease in non-performing assets at the Bank. Mr. Mitchell’s cash incentive was based on the Company’s pre-tax income and return on average assets, as well as ALC’s pre-tax income and average loans outstanding over the twelve-month performance period. Each Named Executive Officer’s cash incentive payment was potentially subject to a downward adjustment as a result of certain classified asset ratios, regulatory ratings and percentages of loans past due at the Bank, in the case of Mr. House and Mr. Elley, or at ALC, in the case of Mr. Mitchell; however, none of these negative criteria were triggered during 2016. In connection with this program, Mr. House earned $7,398, Mr. Mitchell earned $65,628 and Mr. Elley earned $2,888.

Termination and Change in Control Benefits

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 USBI’sthe Company’s shareholders are 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.

Mr. House, our President and Chief Executive Officer, is the only Named Executive Officer with an employment agreement. On December 19, 2013, USBI,the Company, 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 Company, the Bank and Mr. House on November 7, 2011, when Mr. House first began serving as the President and Chief Executive Officer of USBIthe Company 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 is entitled, and certain restrictive covenants, the employment agreement contains certain termination and change in control provisions, the details of which are further discussed 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” 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 beliefWe believe that perquisites for executive officers should be limited in scope and value and also should be reflective ofreflect similar perquisites provided to executive officers at other 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, the company pays the annual premiums for a term life insurance policy with a $250,000 death benefit for Mr. House 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, we 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 20142016 Annual Meeting of Shareholders held on May 2, 2014,April 27, 2016, approximately 87%83% 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’sthe Company’s Named Executive Officers as disclosed in the proxy statement for that meeting. USBI’sThe Company’s Compensation Committee considered this high level of shareholder support when determining the compensation for 20152017 but did not take any actions in 20142016 or to date in 20152017 specifically in response to the shareholder advisory vote on executive compensation. The Compensation Committee concluded that USBI’sthe Company’s compensation program should continue to emphasize the objectives described herein.

COMPENSATION COMMITTEE REPORT

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

This report furnished by the Compensation Committee:

Donna D. SmithJ. Lee McPhearson,, Chairperson

Andrew C. Bearden, Jr.

Gerald P. CorgillRobert Stephen Briggs 

Sheri S. Cook

John C. Gordon

A.J.J. Lee McPhearson

A. J. Strickland, III

EXECUTIVE COMPENSATION

20162014 Summary Compensation Table

The following table sets forth, for the years ended December 31, 20142016 and 2013,2015, 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, USBIthe Company is providing below compensation information for 20142016 and 20132015 for Mr. House, as the President and Chief Executive Officer of USBIthe Company and the Bank, and Mr. Mitchell and Mr. Elley, as the two most highly compensated executive officers of the Company other than Mr. House who were serving as executive officers at the end of 2014.2016.