SCHEDULE 14A
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement.
[ ] Confidential, for use of the Commission only (as permitted by Rule
14a-6(e)(2)).
[X] Definitive proxy statement.
[ ] Definitive additional materials.
[ ] Soliciting materials pursuant to Rule 14a-11(c) or Rule 14a-12.
UNITED BANCORP, INC.
(Name of Registrant as Specified in Its Charter)
________________________________________________________________________________
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of filing fee (check appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(I)(1) and 0-11.
(1) Title of each class of security to which transaction applies:
______________________________________________________________________
(2) Aggregate number of securities to which transaction applies:
______________________________________________________________________
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
______________________________________________________________________
(4) Proposed maximum aggregate value of transaction:
______________________________________________________________________
(5) Total fee paid:
______________________________________________________________________
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the form or schedule and the date of its filing.
(1) Amount Previously Paid:
______________________________________________________________________
(2) Form, Schedule or Registration Statement No.:
______________________________________________________________________
(3) Filing Party:
______________________________________________________________________
(4) Date Filed:
______________________________________________________________________
UNITED BANCORP, INC.
201 S. FOURTH
MARTINS FERRY, OHIO 43935
March 26, 2007
To Our Shareholders:
You are cordially invited to attend the Annual Meeting of the
Shareholders to be held on Wednesday April 18, 2007, at 2:00 p.m. local time, at
The Citizens Savings Bank's main office, 201 South Fourth Street, Martins Ferry,
Ohio.
The Annual Certified Audit of United Bancorp, Inc. is enclosed for
your review prior to attending our Annual Meeting.
Payment of our regular first quarter cash dividend was made by
separate mailing on March 20th. Whether or not you received your dividend check
in a separate mailing is dependent upon your level of participation in our
Dividend Reinvestment Plan, Direct Deposit Program or whether your stock is
being held for you in a broker name. NO PAYMENT HAS BEEN INCLUDED WITH THIS
MAILING OF OUR PROXY MATERIALS.
It is important that your shares are voted, and we hope that you will
attend the Annual Meeting. Please vote by executing and returning the enclosed
form of Proxy or follow the instructions to vote electronically on the Internet
or by phone.
Very truly yours,
/s/ James W. Everson
----------------------------------------
James W. Everson
Chairman, President and Chief Executive
Officer
Enclosures
UNITED BANCORP, INC.
201 S. FOURTH AT HICKORY STREET
MARTINS FERRY, OHIO 43935
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 18, 2007
TO THE SHAREHOLDERS OF
UNITED BANCORP, INC. March 26, 2007
The Annual Meeting of Shareholders of United Bancorp, Inc. will be
held at 201 South 4th, Martins Ferry, Ohio, April 18, 2007, at 2:00 p.m. local
time for the purpose of considering and voting upon the following matters as
more fully described in the Proxy Statement.
PROPOSALS:
1. ELECTION OF DIRECTORS - To elect FOUR directors.
2. OTHER BUSINESS - To transact any other business which may
properly come before the meeting or any adjournment of it.
Shareholders of record at the close of business on March 9, 2007 will
be entitled to vote the number of shares held of record in their names on that
date.
We urge you to sign and return the enclosed proxy as promptly as
possible or vote via the phone or Internet, whether or not you plan to attend
the meeting in person. This proxy may be revoked prior to its exercise.
By Order of the Board of Directors
/s/ Norman F. Assenza, Jr.
----------------------------------------
Norman F. Assenza, Jr.
Secretary
YOUR VOTE IS IMPORTANT. PLEASE MARK, SIGN, DATE AND MAIL THE ENCLOSED PROXY
FORM(S) WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING. A RETURN ENVELOPE
IS ENCLOSED FOR YOUR CONVENIENCE. YOU MAY ALSO VOTE AT HOME BY PHONE OR
INTERNET. PLEASE SEE ENCLOSED INFORMATION ON HOW TO TAKE ADVANTAGE OF THIS
CONVENIENT WAY TO VOTE.
UNITED BANCORP, INC.
201 SOUTH 4TH STREET
MARTINS FERRY, OHIO 43935
PROXY STATEMENT FOR ANNUAL MEETING OF
SHAREHOLDERS TO BE HELD APRIL 18, 2007
INTRODUCTION
This Proxy Statement is being furnished to shareholders of United
Bancorp, Inc. ("United Bancorp" or the "Corporation") in connection with the
solicitation of proxies by the Board of Directors of the Corporation to be used
at the Annual Meeting of Shareholders, and any adjournment thereof, to be held
at the time and place set forth in the accompanying notice ("Annual Meeting").
This Proxy Statement and the enclosed proxy are first being sent to shareholders
on or about March 26, 2007.
At the Annual Meeting, shareholders of the Corporation will be asked
to elect four directors.
VOTING AND REVOCATION OF PROXIES
Just indicate on the enclosed proxy card how you want to vote, and
sign, date and return it as soon as possible in the enclosed envelope or submit
a proxy over the Internet or by telephone by following the instructions on the
enclosed proxy card. Where properly executed proxy cards are returned but no
such instructions are given, the shares will be voted "For" the election to the
Board of Directors of the persons nominated by the Board of Directors of the
Corporation.
The presence of a shareholder at the Annual Meeting will not
automatically revoke such shareholder's proxy. However, shareholders may revoke
a proxy at any time prior to its exercise by filing with the Secretary of the
Corporation a written notice of revocation, by delivering to the Corporation a
duly executed proxy bearing a later date or by attending the Annual Meeting and
voting in person. Written notices of revoked proxies may be directed to Norman
F. Assenza, Jr., Secretary, 201 South 4th Street, Martins Ferry, Ohio 43935.
SOLICITATION OF PROXIES
The cost of soliciting proxies will be borne by the Corporation. In
addition to the solicitation of proxies by mail, the Corporation, through its
directors, officers and regular employees, may also solicit proxies personally
or by telephone, e-mail or telecopy without additional compensation. The
Corporation will also request persons, firms and corporations holding shares in
their names or in the name of their nominees, which are beneficially owned by
others, to send proxy material to and obtain proxies from the beneficial owners
and will reimburse the holders for their reasonable expenses in doing so.
MEETING INFORMATION
DATE, PLACE AND TIME
The Annual Meeting of Shareholders of the Corporation will be held on
Wednesday, April 18, 2007, at 2:00 p.m., local time, at The Citizens Savings
Bank, 201 South 4th Street, Martins Ferry, Ohio.
RECORD DATE, VOTING RIGHTS
Only the Corporation's common shares can be voted at the Annual
Meeting. Each share entitles its owner to one vote on all matters.
The close of business on March 9, 2007 (the "Record Date"), has been
fixed as the record date for the determination of shareholders entitled to vote
at the Annual Meeting. There were approximately 2,000 record holders of the
Corporation's common shares and 5,058,190 of the Corporation's common shares
outstanding as of the Record Date.
The presence in person or by proxy of a majority of the outstanding
common shares of the Corporation entitled to vote at the meeting constitutes a
quorum at the Annual Meeting. Abstentions and broker non-votes will be counted
for purposes of determining the presence of a quorum.
The nominees for director who receive the largest number of votes cast
"For" will be elected as directors. Shares represented at the Annual Meeting in
person or by proxy but withheld or otherwise not cast for the election of
directors will have no impact on the outcome of the election of directors.
OWNERSHIP OF VOTING SHARES
As of the Record Date, the following person was the only shareholder
known to the Company to be the beneficial owner of more than 5% of the Company's
outstanding common shares:
Shares of Common Percent
Person Stock Owned of Class
------ ---------------- --------
United Bancorp, Inc. Employee
Stock Ownership Plan (1)
201 South Fourth Street,
Martins Ferry, OH 43935 354,551 7.0%
----------
1. Under the terms of the ESOP, the ESOP trustee will vote shares allocated to
participants' accounts in the manner directed by the participants. The ESOP
trustee may vote unallocated shares, and allocated shares for which no
timely voting instructions are received, in accordance with its fiduciary
duties. As of the Record Date no shares had been allocated to participants'
accounts and 354,551 shares remain unallocated under the ESOP.
The following table sets forth the beneficial ownership of the
Corporation's common shares by each of the Corporation's directors and the
Corporation's named executive officers, and the directors and executive officers
as a group, as of December 31, 2006.
COMMON SHARES
NAME OF BENEFICIAL OWNER OWNED(1) PERCENT OF CLASS
------------------------ ------------- ----------------
Michael J. Arciello 16,719 *
James W. Everson (2) 172,744 3.4%
John M. Hoopingarner 8,702 *
Terry A. McGhee 20,369 *
L. E. Richardson, Jr. (3) 89,002 1.8%
Richard L. Riesbeck (4) 24,858 *
Matthew C. Thomas (5) 36,640 *
Scott A. Everson 9,326 *
Randall M. Greenwood (6) 16,903 *
James A. Lodes 10,161 *
Norman F. Assenza, Jr. 17,078 *
All Directors and Executive
Officers as a Group
(20 in group) 522,748 9.4%
* Ownership is less than 1% of the class.
----------
1. Except as otherwise noted, none of the named individuals shares with
another person either voting or investment power as to the shares reported.
2. Includes 69,997 shares subject to shared voting and investment power.
3. Includes 394 shares subject to options which are currently exercisable.
4. Includes 17,651 shares subject to shared voting and investment power.
5. Includes 5,936 shares subject to shared voting and investment power.
6. Includes 9,943 shares subject to options which are currently exercisable.
Shares beneficially owned by directors and officers of United Bancorp
and its subsidiaries, and shares beneficially owned by employees through the
Corporation's 401(k) and ESOP employee benefit plans totaled 943,300 Shares, or
18.7% of all outstanding shares of the Corporation, as of December 31, 2006.
PROPOSAL 1
ELECTION OF DIRECTORS
The Code of Regulations of the Corporation provides that the Board of
Directors of the Corporation shall be divided into classes. Ohio law requires
that there be at least three directors in each class. Each class shall hold
office for a term of two years. At the Annual Meeting, four directors will be
elected to a two-year term expiring in 2009.
The nominees for election at the Annual Meeting are James W. Everson,
John M. Hoopingarner, Richard L. Riesbeck and Matthew C. Thomas, each of whom is
currently a director of the Corporation. Mr. James W. Everson, Director,
Chairman, President and Chief Executive Officer of
the Corporation, is the father of Mr. Scott A. Everson, Senior Vice President &
Chief Operating Officer of the Corporation.
The Board of Directors has determined that all Directors have met the
independence standards of Rule 4200(a)(15) of the National Association of
Securities Dealers listing standards with the exception of James W. Everson, who
is the Chief Executive Officer of the Corporation. Directors deemed independent
by the Board of Directors include Michael J. Arciello, John M. Hoopingarner,
Terry A. McGhee, L. E. Richardson, Jr., Richard L. Riesbeck and Matthew C.
Thomas. In making its determination regarding the independence of all directors
and nominees for director, the Nominating and Governance Committee and the Board
of Directors reviewed and the board considered the following related party
transaction.
Director Riesbeck: United Bancorp, through its subsidiary, The
Citizens Savings Bank, pursuant to the terms of a lease entered into on April 1,
1998, paid Riesbeck Food Markets, Inc. $26,004 in 2006, and over the 5-year
fixed term of the lease payments will total $130,020 as lease payments for space
used in an in-store banking location at St. Clairsville, Ohio. Mr. Riesbeck is
an officer, director and shareholder of Riesbeck Food Markets, Inc. Management
believes the lease between Riesbeck Food Markets, Inc. and the Corporation was
made on an arms-length basis. Management employed a third party consulting firm
that specializes in grocery store banking facilities to establish the terms of
the lease.
The Nominating and Governance Committee of the Board of Directors
recommends director candidates to the Board of Directors for nomination, in
accordance with the Corporation's Amended Code of Regulations. The Committee
will investigate and assess the background and skills of potential candidates.
The Nominating and Governance Committee is empowered to engage a third party
search firm to assist it in identifying candidates, but the Committee currently
believes that the existing directors and executive management of the Corporation
and its subsidiaries have sufficient networks of business contacts to identify
candidates. Upon identifying a candidate for serious consideration, one or more
members of the Nominating and Governance Committee would initially interview
such candidate. If a candidate merited further consideration, the candidate
would subsequently interview with all other Nominating and Governance Committee
members (individually or as a group), meet the Corporation's Chief Executive
Officer and other executive officers and ultimately meet many of the other
Directors. The Nominating and Governance Committee would elicit feedback from
all persons who met the candidate and then determine whether or not to recommend
the candidate to the Board of Directors for nomination.
United Bancorp's Corporate Governance Guidelines and Code of Ethics
and Business Conduct set forth the following criteria for Directors:
independence (a majority of the Directors must be independent); honesty and
integrity; willingness to devote sufficient time to fulfilling duties as a
Director; particular experience, skills or expertise relevant to the
Corporation's business; depth and breadth of business and civic experience in
leadership positions; and ties to United Bancorp's geographic markets. United
Bancorp's Corporate Governance Guidelines provide that shareholders may propose
nominees by submitting the names and qualifications of such persons to the
Chairman of the Nominating and Governance Committee. Submissions are to be
addressed to the Chairman of the Nominating and Governance Committee at the
Corporation's executive offices, which submissions will then be forwarded to the
Chairman. The Nominating and Governance Committee would then evaluate the
possible nominee using the criteria outlined above and would consider such
person in comparison to all other candidates. The submission should be made no
later than December 31st of each year for consideration in regard to the next
annual meeting of shareholders. The Nominating and Governance Committee is not
obligated to recommend to the Board, nor the Board to nominate any such
individual for election.
The Nominating and Governance Committee has not hired any director
search firm in 2006 and, accordingly, paid no fees to any such company. As
indicated above, however, the Nominating and Governance Committee may do so in
the future if necessary.
Neither the Board nor the Nominating and Governance Committee has
implemented a formal policy regarding director attendance at the Annual Meeting.
Typically, the Board holds its annual organizational meeting directly following
the Annual Meeting, which results in most directors being able to attend the
Annual Meeting. In 2006, all United Bancorp, Inc. Directors attended the Annual
Meeting.
NOMINEES
CLASS "I" DIRECTORS. The following table sets forth-certain information with
respect to the nominees as Class "I" Directors of the Corporation who will be
voted upon at the Annual Meeting. There were no arrangements or understandings
pursuant to which the persons listed below were selected as directors or
nominees for director.
PRINCIPAL OCCUPATION FOR PAST POSITIONS AND OFFICES DIRECTOR
NAME AGE FIVE YEARS HELD WITH UNITED BANCORP SINCE
---- --- ----------------------------- ------------------------ --------
James W. Everson 68 Chairman, President and Chief Chairman, President and 1969
Executive Officer, United Chief Executive Officer,
Bancorp; Chairman and Chief United Bancorp;
Executive Officer, The Chairman, The Citizens
Citizens Savings Bank* until Savings Bank.* Chairman,
Nov. 1, 2004. Chairman, The Interim President and
Community Bank * Chief Executive Officer,
The Community Bank*
John M. Hoopingarner 52 General Manager and Director 1992
Secretary-Treasurer,
Muskingum Watershed
Conservancy District
Richard L. Riesbeck 57 President, Riesbeck Food Director 1984
Market, Inc., a regional
grocery store chain
Matthew C. Thomas 50 President, M. C. Thomas Director 1988
Insurance Agency, Inc.
CONTINUING DIRECTORS
CLASS "II" DIRECTORS. The following table sets forth certain information with
respect to Class "II" Directors of United Bancorp, whose terms expire in 2008.
PRINCIPAL OCCUPATION FOR PAST POSITIONS AND OFFICES DIRECTOR
NAME AGE FIVE YEARS HELD WITH UNITED BANCORP SINCE
---- --- ----------------------------- ------------------------ --------
Michael J. Arciello 72 Retired Vice President Director 1992
Finance, Nickles Bakeries,
Inc.
Terry A. McGhee 57 President and Chief Executive Director 2001
Officer, Westerman, Inc., a
manufacturing company
L. E. Richardson, Jr. 74 Retired President - Southern Director 1998
Ohio Community
Bancorporation, Inc.
----------
* Subsidiaries of United Bancorp.
There were no agreements or understandings pursuant to which any of
the persons listed above was selected as a director.
The Board of Directors of United Bancorp met 4 times in 2006. In 2006,
each director attended at least 75% of the combined total of meetings of the
Board of Directors and meetings of each committee on which such director served.
The Board of Directors has adopted the United Bancorp, Inc. Corporate
Governance Guidelines, which you may find on United Bancorp's website at
www.unitedbancorp.com. The Board has also adopted the United Bancorp, Inc. Code
of Ethics and Business Conduct, which you may find on United Bancorp's website
at www.unitedbancorp.com.
Shareholders may communicate directly to the Board of Directors in
writing by sending a letter to the Board at: United Bancorp Board of Directors,
201 South Fourth Street, Martins Ferry, Ohio 43935. All letters directed to the
Board of Directors will be received and processed by the Corporate Secretary and
will be forwarded to the Chairman of the Nominating and Governance Committee
without any editing or screening.
COMMITTEES OF THE BOARD
The Board of Directors of United Bancorp has standing Executive,
Audit, Compensation, and Nominating and Governance Committees. The Audit
Committee has been established in accordance with section 3(a)(58)(A) of the
Exchange Act. The membership of these committees is noted below.
EXECUTIVE COMMITTEE. Mr. James W. Everson, Chairman, and Messrs.
Hoopingarner, McGhee and Riesbeck are the members of the Corporation's Executive
Committee. The Executive Committee met 4 times during 2006. The functions of
this committee are to act in the stead of the board between meetings, to receive
formal vendor presentations and to review with management and set the agenda for
each board meeting. The Executive Committee members also serve as advisory
trustees to the Corporation's defined benefit pension plan and as trustees to
the Corporation's 401(k) and ESOP plans.
AUDIT COMMITTEE. Mr. Arciello, Chairman, and Messrs. McGhee and
Riesbeck are the members of the Audit Committee. The Audit Committee met 4 times
during 2006. The functions of this Committee include the engagement of
independent auditors, reviewing with those independent auditors the plans and
results of the audit engagement of the Corporation, approving the annual audit
plan and reviewing the results of the procedures for internal auditing,
reviewing the independence of the independent auditors, reviewing the
Corporation's financial results and Securities and Exchange Commission filings,
reviewing the effectiveness of the Corporation's internal controls and similar
functions and approving all auditing and non-auditing services performed by its
independent auditors. The Board of Directors has adopted a written charter for
the Audit Committee which may be found on the Corporation's website at
www.unitedbancorp.com. All members of the Audit Committee meet the independence
standards of Rule 4200(a)(15) and the audit committee qualifications of Rule
4350(d)(2) of the National Association of Securities Dealers listing standards.
The Board of Directors has determined that Michael J. Arciello is an audit
committee financial expert for the Corporation and is independent as described
in the preceding sentence. The report of the Audit Committee for 2006 appears
under the caption "Report of the Audit Committee".
COMPENSATION COMMITTEE. Mr. Thomas, Chairman, and Messrs. Hoopingarner
and Richardson are the members of the Compensation Committee. The Board of
Directors has a Compensation Committee comprised entirely of independent
Directors. Director and executive officer compensation are determined by this
Committee of the Board of Directors. The Board of Directors has adopted a
Compensation Committee Charter which may be found on the Corporation's website
at www.unitedbancorp.com. This Committee met twice during 2006. The Compensation
Committee's report on executive compensation matters for 2006 appears under the
caption "Compensation Committee Report on Executive Compensation".
NOMINATING AND GOVERNANCE COMMITTEE. The Nominating and Governance
Committee is comprised entirely of independent Directors. Mr. Riesbeck,
Chairman, and Messrs. Hoopingarner and McGhee are the members of the Nominating
and Governance Committee. This Committee develops and recommends to the Board
corporate governance policies and guidelines for the Corporation and for the
identification and nomination of Director and committee member candidates and
recommends to the Board for nomination by the Board in accordance with the
Corporation's Amended Code of Regulations, nominees for election to the Board
and appointment to committee membership.
The Board of Directors has adopted a Nominating and Governance
Committee Charter which may be found on the Corporation's website at
www.unitedbancorp.com. This Committee met once in 2006.
AUDIT COMMITTEE REPORT
The Audit Committee of the United Bancorp Board of Directors (the
"Committee") is composed of three directors, each of whom is independent as
defined by the National Association of Securities Dealers' listing standards,
and operates under a written charter adopted by the Board of Directors.
Management is responsible for the Corporation's internal controls and
the financial reporting process. The independent auditors are responsible for
performing an independent audit of the Corporation's consolidated financial
statements in accordance with accounting principles generally accepted in the
United States of America, and to issue a report thereon. The Committee's
responsibility is to monitor and oversee the processes. In this context, the
Committee has met and held discussions with management and the independent
auditors. In discharging its oversight responsibility as to the audit process,
the Committee obtained from the independent auditors a formal written statement
describing all relationships between the auditors and the Corporation that might
bear on the auditors' independence consistent with Independence Standards Board
Standard No. 1, "Independence Discussions with Audit Committees," discussed with
the auditors any relationships that may impact their objectivity and
independence and satisfied itself as to the auditors' independence. The
Committee also discussed with management, the internal auditors and the
independent auditors the quality and adequacy of United Bancorp's internal
controls and the internal audit function's organization, responsibilities,
budget and staffing. The Committee reviewed both with the independent and
internal auditors their audit plans, audit scope and identification of audit
risks.
The Committee also discussed and reviewed with the independent
auditors all communications required by generally accepted auditing standards,
including those described in Statement on Auditing Standards No. 61, as amended,
"Communication with Audit Committees," and, with and without management present,
discussed and reviewed the results of the independent auditors' examination of
the financial statements.
The Committee reviewed the audited consolidated financial statements
of United Bancorp as of and for the year ended December 31, 2006, with
management and the independent auditors. Based on the aforementioned review and
discussions with management and the independent auditors, the Committee
recommended to the Board that United Bancorp's audited consolidated financial
statements be included in its Annual Report on Form 10-K for the year ended
December 31, 2006, for filing with the Securities and Exchange Commission. The
Committee also appointed the independent auditors.
AUDIT COMMITTEE
Michael J. Arciello, Chairman
Terry A. McGhee
Richard L. Riesbeck
PRINCIPAL ACCOUNTING FIRM FEES
The following table sets forth the aggregate fees billed to United
Bancorp for the fiscal years ended December 31, 2006 and December 31, 2005 by
Grant Thornton LLP, United Bancorp's principal accounting firm for both years.
2006 2005
-------- -------
Audit Fees $ 77,630 $62,500
Audit-Related Fees 17,700(a) 14,625(a)
Tax Fees 4,395(b) 7,750(b)
All Other Fees 2,000(c) 2,308(c)
-------- -------
Total $101,725 $87,183
======== =======
----------
(a) Includes fees for services related to benefit plan audits.
(b) Includes fees for services related to tax compliance and tax planning.
(c) Consent for public filings.
The Audit Committee is responsible for pre-approving all auditing
services and permitted non-audit services to be performed by its independent
auditors, except as described below. The Audit Committee will establish general
guidelines for the permissible scope and nature of any permitted non-audit
services in connection with its annual review of the audit plan and will review
such guidelines with the Board of Directors. Pre-approval may be granted by
action of the full Audit Committee or, in the absence of such Audit Committee
action, by the Audit Committee Chair whose action shall be considered to be that
of the entire Committee. Pre-approval shall not be required for the provision of
non-audit services if (1) the aggregate amount of all such non-audit services
constitute no more than 5% of the total amount of revenues paid by the
Corporation to the auditors during the fiscal year in which the non-audit
services are provided, (2) such services were not recognized by the Corporation
at the time of engagement to be non-audit services, and (3) such services are
promptly brought to the attention of the Audit Committee and approved prior to
the completion of the audit. No services were provided by Grant Thornton LLP
pursuant to these exceptions.
EXECUTIVE COMPENSATION
AND OTHER INFORMATION
The following information relates to compensation of management for
the year ended December 31, 2006, unless otherwise noted below. Mr. Everson
presently serves as Chairman of the Board of Directors of The Citizens Bank, of
Martins Ferry, Ohio and Chairman, Interim President and CEO of The Community
Bank, Lancaster, Ohio, each of which are wholly-owned subsidiary of the Company.
COMPENSATION DISCUSSION AND ANALYSIS
Introduction. The Compensation Committee administers our executive
compensation program. The committee, which is composed entirely of independent
directors, is responsible for reviewing and determining executive officer
compensation, for evaluating the President and Chief Executive Officer, for
overseeing the evaluation of all other officers and employees, for administering
our incentive compensation programs, for approving and overseeing the
administration of our employee benefits programs, for providing insight and
guidance to management with respect to employee compensation generally, and for
reviewing and making recommendations to the board with respect to director
compensation. The President and Chief Executive Officer participates with
respect to decisions concerning other executive officers of the Corporation.
The Compensation Committee operates under a charter adopted by the
board of directors. The Compensation Committee annually reviews the adequacy of
its charter and recommends changes to the board for approval. The charter grants
the Committee the authority to retain and terminate advisors, including
compensation consultants, accountants and legal counsel, to assist in
discharging its duties. The Compensation Committee meets at scheduled times
during the year and also acts upon occasion by written consent. The chair of the
committee reports on committee activities and makes committee recommendations at
meetings of the board of directors.
Compensation Philosophy. Our executive compensation programs seek to
achieve and maintain equity with respect to balancing the interests of
shareholders and executive officers, while supporting our need to attract and
retain competent executive management. Toward this end, the management
compensation committee has developed an executive compensation policy, along
with supporting executive compensation plans and programs, which are intended to
attain the following objectives:
- Support a pay-for-performance policy that rewards Executive Officers
for corporate performance.
- Motivate Executive Officers to achieve strategic business goals.
- Provide competitive compensation opportunities critical to the
Corporation's long-term success.
The committee collects and analyzes comparative executive compensation
information from relevant peer groups, approves executive salary adjustments.
Additionally, from time to time, the committee reviews other human resource
issues, including qualified and non-qualified benefits, management performance
appraisals, and succession planning.
The Committee uses comparisons of competitive executive pay practices
taken from banking industry compensation surveys and, from time-to-time,
consultation with independent executive compensation advisors. Peer groups and
competitive compensation practices are
determined using executive compensation packages at bank holding companies and
subsidiaries of comparable size to the Corporation and its subsidiaries.
There are two principal components of the compensation program for all
Executive Officers of the Corporation and its commercial bank subsidiaries; a
base salary component and a cash bonus incentive component. Until 2006, the
Corporation also had a long-term incentive compensation component in the form of
a stock option plan. Awards can no longer be made under the plan, but the final
grants that were made under the plan will not expire until 2015. The Corporation
also has a 401(k) and employee stock ownership plan and a defined benefit
pension plan.
In making its decisions regarding annual salary adjustments, the
committee reviews quantitative and qualitative performance factors as part of an
annual performance appraisal. These are established for each executive position
and the performance of the incumbent executive is evaluated annually against
these standards. This appraisal is then integrated with market-based adjustments
to salary ranges to determine if a base salary increase is merited.
The accounting and tax treatment of particular forms of compensation
materially do not affect the committee's compensation decisions. However, the
committee evaluates the effect of such accounting and tax treatment on an
ongoing basis and will make appropriate modifications to its compensation
policies where appropriate.
Components of Compensation. The elements of total compensation paid by the
Corporation to its senior officers, including the President and Chief Executive
Officer (the "CEO") and the other executive officers identified in the Summary
Compensation Table which appears following this Compensation Discussion and
Analysis (the CEO and the other executive officers identified in that Table are
sometimes referred to collectively as the "Named Executive Officers"), include
the following:
- Base salary;
- Awards under our cash-based incentive compensation program;
- Awards under our 401(k) and employee stock ownership plan;
- Benefits pursuant to our defined benefit pension plan; and
- Benefits under our life, health and disability plans.
- Base Salary. The base salaries of the Named Executive Officers are reviewed
by the Committee annually as well as at the time of any promotion or significant
change in job responsibilities. The committee reviews peer group data to
establish a market-competitive executive base salary program, combined with a
formal performance appraisal system that focuses on awards that are integrated
with strategic corporate objectives. Salary income for each Named Executive
Officer for calendar year 2006 is reported in "Salary" column of the Summary
Compensation Table, which appears following this Compensation Discussion and
Analysis. The base salary amounts shown in the Summary Compensation Table
include directors fees paid in 2006 for service as a director of United Bancorp
or one or more of its subsidiary banks in the following amounts for these
executive officers:
Mr. James W. Everson $41,799
Mr. Scott A. Everson $12,280
Incentive Cash Compensation. United Bancorp has established a short-term
incentive compensation plan that provides for cash awards upon the achievement
of performance targets established for each executive officer. The cash-based
plan is designed to reward achievement of short-term performance goals. For
2006, the Compensation Committee selected goals based on United Bancorp's
earnings per share, and growth in subsidiary bank loans and deposits, return on
assets and return on equity. Threshold, target and maximum performance goals
were set.
The amount of the annual cash bonus that may be earned by an executive
officer is based on his or her base salary and is weighted to reflect each
participant's ability to affect the performance of United Bancorp, with the
Chief Executive Officer having the largest weighting. Awards under the
Corporation's cash incentive compensation plan are based on the Corporation's
earnings per share for the year and the satisfaction of bank performance
benchmarks. The exact weighting and mix of these goals varies among the
executive officers. For more information regarding the structure of this plan,
see the section of this proxy statement captioned "Grants of Plan Based Awards."
Additionally, the Chief Executive Officer may earn a cash bonus based on
acquisitions by United Bancorp and the resulting growth in assets of the
Corporation.
United Bancorp did not meet the threshold goal for earnings per share
in 2006, therefore the incentive award portion of each executive that related to
earnings per share growth was zero for 2006. United Bancorp did not make any
acquisitions in 2006. The Citizens Savings Bank met target goals for return on
assets, return on equity and deposit growth. The Community Bank did not meet any
of the goals set for executive officer incentive compensation.
- 401(k) and Employee Stock Ownership Plan. The Company also offers a 401(k)
plan, which covers all employees who have attained the age of 21 and have
completed one year of service. Eligible employees may contribute up to $15,000
in 2006 and employees who have attained the age of 50 years or older may
contribute an additional $5,000 in 2006. The Company may make a discretionary
matching contribution equal to a percentage of each participant's elective
deferral not to exceed 6% of the participant's annual compensation. Employer
contributions are invested in the common stock of United Bancorp, Inc. under the
Corporation's stock ownership plan. Employee contributions are always vested.
Employer contributions become 100% vested after 3 years of service. The
Corporation's contributions to the plan made on behalf of the Named Executive
Officers is included in the "all other compensation" column in the summary
compensation table.
- Defined Benefit Pension Plan. The Corporation has a defined benefit pension
plan which covers all fulltime employees 21 or over who have completed 1,000
hours of service during an anniversary year, measured from date of hire. The
plan calls for benefits to be paid to eligible employees at retirement, based
primarily upon years of service and compensation rates near retirement. Benefits
at retirement or vested termination of employment are based on years of credited
service, and the average of the highest five consecutive years of compensation.
- Group Life, Health and Disability Benefits. The Corporation provides
healthcare, life and disability insurance and other employee benefits programs
to its employees, including its senior officers, except that life insurance is
not provided under the group plan to executive officers that participate in the
split-dollar life insurance arrangements discussed more thoroughly below. The
committee is responsible for overseeing the administration of these programs and
believes that its employee benefits programs should be comparable to those
maintained by other members of the relevant peer groups so as to assure that the
Corporation is able to maintain a competitive position in terms of attracting
and retaining officers and other employees. Except for United Bancorp's split
dollar life insurance arrangements with its executive officers and certain
directors our employee benefits plans are provided on a non-discriminatory basis
to all employees.
United Bancorp has split-dollar life insurance arrangements with its
executive officers and certain directors that provide certain death benefits to
the executive's beneficiaries upon his or her death. The agreements provide a
pre- and post-retirement death benefit payable to the beneficiaries of the
executive in the event of the executive's death. The Corporation has purchased
life insurance policies on the lives of all participants covered by these
agreements in amounts sufficient to provide the sums necessary to pay the
beneficiaries, and the Corporation pays all premiums due on the policies. Under
the arrangements, directors have the right to designate beneficiaries of death
proceeds up to $100,000, subject to forfeiture of that right upon the occurrence
of certain events. The named executive officers have the right to designate
beneficiaries of death proceeds up to four times the named executive officer's
annual base salary, subject to forfeiture of that right upon the occurrence of
certain events. The actual gross death benefit amounts payable under this plan
are disclosed under Payments and Benefits in Connection with Termination or
Change-in-Control. The economic benefit (the imputed income amount of this
insurance) for the year 2006 to the named executive officers is included in the
amounts for each of these executive officers set forth in the Summary
Compensation Table under the column "All Other Compensation." The economic
benefit (the imputed income amount of this insurance) for the year 2006 to the
directors is set forth in the Director Compensation Table under the column "All
Other Compensation."
2006 Executive Officer Compensation. For 2006 the executive officers named
in the Summary Compensation Table received salaries that were intended to
maintain their compensation at a competitive level. Adjustments in 2006 base
salary were based upon each Named Executive's annual performance review, an
annual review of peer compensation, and the overall performance of the company.
These adjustments are consistent with the company's salary budget which is
approved by the management compensation committee and becomes part of the
overall budget approved annually by the board of directors.
The Corporation provides a reasonable level of personal benefits, and
perquisites to one or more named executive officers to support the business
interests of the bank, provide competitive compensation, and to recognize the
substantial commitment both professionally and personally expected from
executive officers. The aggregate value of perquisites and personal benefits, as
defined under SEC rules, provided to each named executive officer is less than
the reporting threshold value of $10,000.
As part of its compensation program the Corporation has entered into
agreements with each of the Named Executive Officers pursuant to which they will
be entitled to receive severance benefits upon the occurrence of certain
enumerated events following a change in control. The events that trigger payment
are generally those related to termination of employment without cause or
detrimental changes in the executive's terms and conditions of employment. See
Employment Contracts and Payments Upon Termination or "Change in Control" below
for a more detailed description of these events. the Corporation believes that
this structure will help: (i) assure the executives' full attention and
dedication to the company, free from distractions caused by personal
uncertainties and risks related to a pending or threatened change in control,
(ii) assure the executives' objectivity for shareholders' interests, (iii)
assure the executives of fair treatment in case of involuntary termination
following a change in control, and (iv) attract and retain key talent during
uncertain times.
COMPENSATION COMMITTEE REPORT
The management compensation committee has reviewed and discussed with
management the compensation discussion and analysis set forth above. Based on
such review and discussions, the management compensation committee has
recommended to the board of directors that the compensation discussion and
analysis be included in this proxy statement and in the Annual Report on Form
10-K for the year ended December 31, 2006, filed by us with the Securities and
Exchange Commission.
COMPENSATION COMMITTEE
Matthew C. Thomas, Chairman
John M. Hoopingarner
L.E. Richardson, Jr.
EXECUTIVE COMPENSATION. The following table sets forth the annual and long-term
compensation for United Bancorp's Chief Executive Officer and its four other
highest paid executive officers, as well as the total compensation paid to each
individual during United Bancorp's last completed fiscal year.
SUMMARY COMPENSATION TABLE
CHANGE IN
PENSION VALUE
NON-EQUITY AND NONQUALIFIED
STOCK OPTION INCENTIVE PLAN DEFERRED ALL OTHER
NAME AND PRINCIPAL SALARY BONUS AWARDS AWARDS COMPENSATION COMPENSATION COMPENSATION
POSITION YEAR ($) ($) ($) ($) ($) EARNINGS ($)(1) ($)(2) TOTAL ($)
-------------------------- ---- ------- ----- ------ ------ -------------- ---------------- ------------ ---------
James W. Everson 2006 247,799 -- -- -- -0- 482 19,313 267,594
Chairman President &
Chief Executive Officer,
United Bancorp, Inc
Principal Position CEO
United Bancorp, Inc.
Scott A. Everson 2006 168,280 -- -- -- 8,789 9,526 6,361 192,956
Senior Vice President &
Chief Operating Officer
United Bancorp, Inc.
Principal Position CEO
The Citizens Savings Bank
Randall M. Greenwood 2006 108,000 -- -- -- 4,604 3,041 3,797 119,442
Senior Vice President,
Chief Financial Officer &
Treasurer, United Bancorp,
Inc.
Principal Position, CFO,
United Bancorp, Inc.
James A. Lodes 2006 98,000 -- -- -- 8,423 16,289 4,333 127,045
Vice President,
Chief Lending Officer,
United Bancorp, Inc,
Principal Position, CLO,
the Citizens Savings Bank
Norman F. Assenza, Jr. 2006 94,000 -- -- -- 8,079 28,533 5,493 136,105
Vice President Compliance
United Bancorp, Inc.
Principal Position,
Compliance and Internal
Auditor, The Citizens
Savings Bank
----------
(1) Reports increase in present value of the Defined Benefit Plan accrual from
2005 to 2006. Refer to Pension Benefits table for explanation of benefit
and disclosure of present value of accumulated benefit as of 12/31/06.
(2) The amounts shown in this column for the most recently completed fiscal
year were derived from the following figures: (1) contributions by United
Bancorp to its 401(k) Plan: Mr. James W. Everson, $6,180; Mr. Scott A.
Everson $5,700; Mr. Greenwood $3,240; Mr. Lodes, $3,459; and Mr. Assenza
$2,820 (2) the economic benefit of life insurance coverage provided for the
named executive officers: Mr. James W. Everson, $13,133; Mr. Scott A.
Everson $661; Mr. Greenwood $557; Mr. Lodes, $874 and Mr. Assenza $2,673.
GRANTS OF PLAN-BASED AWARDS
ALL OTHER
STOCK
AWARDS: ALL OTHER
NUMBER STOCK GRANT
ESTIMATED FUTURE PAYOUTS ESTIMATED FUTURE PAYOUTS OF AWARDS: EXERCISE DATE FAIR
UNDER NON-EQUITY UNDER EQUITY INCENTIVE SHARES NUMBER OF OR BASE VALUE OF
INCENTIVE PLAN AWARDS PLAN AWARDS OF STOCK SECURITIES PRICE OF STOCK &
-------------------------- -------------------------- OR STOCK UNDERLYING OPTION EQUITY
GRANT THRESHOLD TARGET MAXIMUM THRESHOLD TARGET MAXIMUM UNITS OPTIONS AWARDS AWARDS
NAME DATE ($) ($) ($) (#) (#) (#) (#) (#) ($/SHARE) $
---- ----- --------- ------ ------- --------- ------ ------- --------- ---------- --------- ---------
James W. Everson 38,625 51,500 103,000
Scott A. Everson 7,313 33,150 66,300
Randall M. Greenwood 4,050 21,600 43,200
James A. Lodes 7,350 19,600 39,200
Norman F. Assenza, Jr. 7,050 18,800 37,600
The Corporation maintains a cash-based incentive compensation plan.
The amount of the annual cash bonus that may be earned by an executive officer
under this plan is based on his or her base salary and is weighted to reflect
each participant's ability to affect the performance of United Bancorp, with the
Chief Executive Officer having the largest weighting. The multiple by which the
bonus of the Chief Executive Officer is determined under the plan is set at 25%
of his base salary for the year (the "Base Multiple"). The Base Multiples for
the Corporation's Senior Vice Presidents (Messrs. S. Everson and Greenwood) and
Vice Presidents (Messrs. Lodes and Assenza) are set at 20% of their respective
base salaries for the year.
Awards under the Corporation's cash incentive compensation plan are
based on two general and independent criteria: (1) the Corporation's earnings
per share; and (2) the performance in various categories of the particular
subsidiary bank over which the named executive has actual managerial
responsibility. Under the plan, the entire potential bonus of the Corporation's
Chief Executive Officer for the year is dependent upon the Corporation meeting
or exceeding its earnings per share from the previous year, while 75% and 50%,
respectively, of the Senior Vice Presidents' and Vice Presidents' potential
bonuses are determined by reference to earnings per share. The balance of their
incentive compensation is based upon their individual bank's financial
performance. Under the Corporation's cash incentive compensation plan, each
executive officer would have been entitled to receive earnings per share bonuses
as follows:
- Earnings per share equal to previous year: 75% of Base Multiple
- 05% Increase in earnings per share over previous year: 100% of Base
Multiple
- 10% Increase in earnings per share over previous year: 125% of Base
Multiple
- 15% Increase in earnings per share over previous year: 150% of Base
Multiple
- 17% Increase in earnings per share over previous year: 175% of Base
Multiple
- 20% Increase in earnings per share over previous year: 200% of Base
Multiple
The Corporation's earnings per share for 2006 did not meet or exceed
the earnings per share for 2005. Consequently, no awards were made to any
executive officer under this component of the Corporation's cash incentive
compensation plan. J. Everson, as Chief Executive Officer of the Corporation,
received no incentive compensation for 2006. As indicated above, the remaining
portion of potential bonus payments for Senior Vice Presidents and Vice
Presidents of the Corporation is determined by reference to personal achievement
objectives and bank performance benchmarks including return on average equity,
return on average assets, year end deposit balances, and year end loan balances.
Threshold amounts indicated in the table above cover bonus compensation that
would have been paid had the executive officer met minimum thresholds under each
applicable criteria.
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
Stock Awards
------------------------------------
Equity
Incentive
Plan
Equity Awards:
Incentive Market
Plan or
Awards: Payout
Market Number Value
Option Awards(1) Number Value of of
------------------------------------------------------------- of of Unearned Unearned
Equity Shares Shares Shares, Shares,
Incentive or or Units Units
Plan Units Units or or
Awards: of of Other Other
Number of Number of Number of Stock Stock Rights Rights
Securities Securities Securities That That That That
Underlying Underlying Underlying Option Have Have Have Have
Unexercised Unexercised Unexercised Exercise Option Not Not Not Not
Options (#) Options (#) Unearned Price Expiration Vested Vested Vested Vested
Name Exercisable Unexercisable Options (#) ($) Date (#) ($) (#) ($)
---- ----------- ------------- ----------- -------- ---------- ------ ------ --------- ---------
James W. Everson -- 1,815 -- $10.15 1/16/2015 -- -- -- --
Randall M. Greenwood 9,343 -- -- 11.65 3/1/2007 -- -- -- --
-- 13,245 -- 9.63 5/15/2015 -- -- -- --
Scott A. Everson -- 13,245 -- 9.63 5/15/2015 -- -- -- --
-- 12,100 -- 12.15 8/23/2014 -- -- -- --
James A. Lodes -- -- -- -- -- -- -- -- --
Norman F. Assenza, Jr. -- -- -- -- -- -- -- -- --
----------
1. All outstanding options were awarded under the Corporations stock option
plan, which expired in 2005.
PENSION BENEFITS
PRESENT
NUMBER OF YEARS VALUE OF
CREDITED SERVICE ACCUMULATED PAYMENTS DURING
NAME PLAN NAME (#) BENEFIT ($) LAST FISCAL YEAR ($)
---- -------------------------------------- ---------------- ----------- --------------------
James W. Everson United Bancorp, Inc. of Martins Ferry, 2 24,278 --
Ohio Employers' Pension Plan and Trust
Scott A. Everson United Bancorp, Inc. of Martins Ferry, 16 37,355 --
Ohio Employers' Pension Plan and Trust
Randall M. Greenwood United Bancorp, Inc. of Martins Ferry, 9 21,787 --
Ohio Employers' Pension Plan and Trust
James A. Lodes United Bancorp, Inc. of Martins Ferry, 13 132,951 --
Ohio Employers' Pension Plan and Trust
Norman F. Assenza United Bancorp, Inc. of Martins Ferry, 27 280,615 --
Ohio Employers' Pension Plan and Trust
The Company has a defined benefit pension plan which covers all
fulltime employees 21 or over who have completed 1,000 hours of service during
an anniversary year, measured from date of hire. The plan calls for benefits to
be paid to eligible employees at retirement, based primarily upon years of
service and compensation rates near retirement. It may provide monthly benefits
commencing as early as age 50, but not later than age 70, for employees who
terminate employment or retire with 5 or more years of credited service.
Benefits at retirement or vested termination of employment are based on years of
credited service, and the average of the highest five consecutive years of
compensation. The plan is integrated with social security covered compensation.
In connection with his retirement as Chief Executive Officer of the Citizens
Savings Bank subsidiary of United Bancorp on November 1, 2004, Mr. James Everson
elected a lump sum distribution from the plan in 2004 reflecting his then 43
years of credited service under the plan.
The present values of accumulated benefits were calculated in
accordance with Statement of Financial Accounting Standards No. 35. Key
actuarial assumptions used in the calculations include: (1) assumed long-term
investment return of 7.0% annually; (2) the 1983 Group Annuity Mortality Table;
(3) a table of probabilities of termination of employment before retirement, and
(4) an assumed retirement age of 65.
NONQUALIFIED DEFERRED COMPENSATION
EXECUTIVE REGISTRANT AGGREGATE AGGREGATE AGGREGATE
COMPENSATION IN CONTRIBUTIONS EARNINGS IN WITHDRAWALS/DISTRIBUTIONS BALANCE AT LAST
NAME LAST FY ($)(1) IN LAST FY ($) LAST FY ($) ($) FY ($)(2)
---- --------------- -------------- ----------- ------------------------- ---------------
James W. Everson 41,799 0 13,861 0 312,932
Scott A. Everson 12,280 0 2,351 0 55,489
----------
1 This amount represents deferred director fees reported as Salary in the
Summary Compensation Table.
2 Aggregate balances include amounts of contributions and earnings since the
plan's inception in 1996. Contributions by each of the named executive
officers were previously disclosed as compensation for the year earned.
United Bancorp, Inc. has established a deferred compensation plan for
the benefit of its directors and the directors of its subsidiary banks. Both
James and Scott Everson participate in this plan in their capacity as directors,
along with directors Hoopingarner, McGhee and Thomas. For more information
regarding this plan, see the section of this proxy statement captioned "Director
Compensation."
EMPLOYMENT CONTRACTS AND PAYMENTS UPON
TERMINATION OR "CHANGE IN CONTROL"
PAYMENT ON DEATH OR DISABILITY UNDER
NAME OF EXECUTIVE AMOUNT PAID ON CHANGE IN CONTROL SPLIT-DOLLAR LIFE INSURANCE ARRANGEMENTS
----------------- -------------------------------- ----------------------------------------
James W. Everson $843,491 $824,000
Scott A. Everson $415,928 $624,000
Randall M. Greenwood $255,542 $432,000
James A. Lodes $118,764 $392,000
Norman F. Assenza $113,753 $376,000
The Company has entered into change-in-control agreements with Messrs.
James W. Everson, Scott A. Everson, Greenwood. Lodes and Assenza. The agreements
provide that Mr. James W. Everson, Mr. Scott A. Everson, Mr. Greenwood, Mr.
Lodes and Mr. Assenza will be entitled to a lump sum severance benefit in the
event of their involuntary termination of employment (other than for cause)
following a "change in control" of the Corporation, as defined in the
Agreements. In the event of a change in control and the involuntary termination
of employment, the agreements provide that Mr. James W. Everson will receive
2.99 times his annual compensation, Mr. Scott A. Everson will receive 2.0 times
his annual compensation, Mr. Greenwood will receive 2.0 times his annual
compensation and Mr. Lodes will receive 1.0 times his annual compensation and
Mr. Assenza will receive 1.0 times his annual compensation in a lump sum cash
payment. If a change in control had occurred as of December 31, 2006, this would
have resulted in payments to the executives as shown on the above table. Also
included in the table are amounts that would be payable to the executive or
their estate pursuant to the Corporation's split-dollar life insurance
arrangements. Benefits accrued as of December 31, 2006 for the Named Executive
Officers under the Corporation's defined benefit pension and nonqualified
deferred compensation plans are disclosed above under the applicable tables.
DIRECTOR COMPENSATION
CHANGE IN
PENSION VALUE
AND
FEES NON-EQUITY NONQUALIFIED
EARNED OR STOCK INCENTIVE PLAN DEFERRED ALL OTHER
PAID IN AWARDS COMPENSATION COMPENSATION COMPENSATION
NAME CASH ($) ($) ($) EARNINGS ($) ($) TOTAL ($)
---- --------- ------ -------------- ------------- ------------ ---------
Michael J. Arciello 25,870 0 0 0 0 25,870
John M. Hoopingarner 28,300 0 0 0 281 28,581
Terry A. McGhee 25,450 0 0 0 468 25,918
L.E. Richardson, Jr. 22,670 0 0 0 0 22,670
Richard L. Riesbeck 29,640 0 0 0 520 30,160
Matthew C. Thomas 27,840 0 0 0 230 28,070
United Bancorp compensates each director for services as a director in
the following manner: each director receives an annual retainer fee of $7,500
regardless of board meeting attendance and $520 per meeting attended. Each
member of the Executive Committee and Compensation Committee receives $230 for
each meeting attended. The Chairman of the Audit Committee receives $430 and
each other member of the Audit Committee receives $268 for each meeting of the
Audit Committee attended other than those held in connection with a meeting of
the Board of Directors. Amounts indicated under the "All Other Compensation"
column represent the annual economic benefit imputed to each of the respective
directors under the Corporation's split dollar life insurance arrangement for
the year 2006.
United Bancorp, Inc. has also established a deferred compensation plan
for the benefit of its directors and the directors of its subsidiary banks. The
Plan is an unfunded deferred compensation plan for tax purposes and for purposes
of Title I of ERISA. Amounts deferred by
directors under the Plan shall remain unrestricted assets of the Corporation,
and participants have the status of general unsecured creditors of the
Corporation. Any member of the Board of Directors who desires to participate in
the Plan may elect for any year, on or before the 31st day of December of the
preceding year, to defer all or a specified part of the fees which thereafter
shall be payable to him for services in the succeeding year. Additionally, such
an election may be made at any time within thirty (30) days following the date
on which a person is elected to the Board of Directors if such person was not a
member of the Board on the preceding December 31st, provided that such election
shall apply only for fees earned for services performed subsequent to the
election for such calendar year. A Director may also make such an election
within thirty (30) days following adoption of the Plan by such subsidiary of
United Bancorp, Inc. which had not previously participated in the Plan, provided
that such election shall apply only for fees earned for services performed
subsequent to the election for such calendar year. At least annually a
Director's account balances or credits shall be deemed to be invested in United
Bancorp, Inc. Common Stock and the Director's account shall be credited with any
subsequent dividends with respect to the Common Stock credited to his or her
account.
When a participating Director ceases to be a member of the Board, the
Corporation shall pay him or her in equal annual installments or at his
irrevocable election, in one lump sum, the aggregate number of shares of United
Bancorp, Inc. Common Stock, (including, without limitation shares deemed to be
acquired through reinvested dividends) that are credited to his or her account
as of the close of business on the date of the termination of his membership on
the Board, together with any cash account balance which has not yet been deemed
invested in United Bancorp, Inc. Common Stock. The annual installment payment
option shall be over a period not to exceed ten years.
Amounts deferred by participating directors during 2006 are indicated
in the table below.
NAME DIRECTOR COMPENSATION IN LAST FY ($)
---- ------------------------------------
John M. Hoopingarner 5,660
Terry A. McGhee 12,725
Matthew C. Thomas 5,591
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION IN COMPENSATION
DECISIONS.
In 2006 the Compensation Committee members were Matthew C. Thomas,
Chairman, John M. Hoopingarner and L.E. Richardson, Jr. All members of the
compensation committee are independent directors, and none of them are present
or past employees or officers of the Corporation or any of its subsidiaries. No
member of the compensation committee has had any relationship with the
Corporation requiring disclosure under Item 404 of Regulation S-K under the
Exchange Act. During the past year, certain directors and officers, including
members of the Compensation Committee, and one or more of their associates may
have been customers of and had business transactions with United Bancorp's
subsidiary banks. All loans included in such transactions were made in the
ordinary course of business and on substantially the same terms, including
interest rates and collateral, as those prevailing at the same time for
comparable transactions with other persons, and did not involve more than normal
risk of collectibility or present other unfavorable features. It is expected
that similar transactions will occur in the future. Mr. James W. Everson, Chief
Executive Officer of the Corporation, does not participate in any
deliberations or decisions regarding his own compensation. During 2006, no
executive officers of the Corporation served on any board or compensation
committee of any other entity that has an executive officer which serves on our
board or compensation committee.
CERTAIN TRANSACTIONS
United Bancorp has engaged and intends to continue to engage in the
lending of money through its subsidiary banks to several of its Directors,
executive officers and corporations or other entities in which they may own a
controlling interest. The loans to such persons (i) were made in the ordinary
course of business, (ii) were made on substantially the same terms, including
interest rates and collateral, as those prevailing at the time for comparable
transactions with other persons, and (iii) did not involve more than a normal
risk of collectibility or present other unfavorable features. Except for the
specific transactions described above no director, executive officer or
beneficial owner of more than five percent of the Corporation's outstanding
voting securities (or any member of their immediate families) engaged in any
transaction with the Corporation during 2006 in which the amount involved
exceeded $120,000.
It is customary and routine for directors, officers and employees of
community banks and their spouses, family members and associates to do business
with their community bank. Such a relationship, including specifically routine
banking business, is viewed as beneficial to the Corporation and is encouraged,
so long as such relationships are fair and reasonable to the Corporation and are
entered into upon terms and conditions generally available to the public, or
similar to that which could be obtained from an independent third party. In that
regard, pursuant to the Corporation's Code of Ethics and business Conduct,
United Bancorp may do business and have financial dealings with directors,
officers and employees and their respective spouses, family members and
associates provided either of the following criteria are satisfied:
- such business or financial dealings involve United Bancorp's
subsidiary banks or any other financial services subsidiary
providing banking or financial services to such person in the
ordinary course of business upon terms and conditions generally
available to the public, to the extent such arrangements are made
in compliance with all applicable banking and securities laws and
regulations; or
- the terms and conditions of such relationship have been presented
to and approved by the Audit Committee of United Bancorp's Board
of Directors, including any "related party transaction" requiring
disclosure in United Bancorp's annual meeting proxy statement. In
the event any member of the Audit Committee, any entity
controlled by such member, or any associate or family member of
such member, proposes to provide products or services to the
Corporation, such member must recuse him or herself from the
discussion and decision about the appropriateness of such
arrangement.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16 of the Securities Exchange Act of 1934 requires United
Bancorp's executive officers, directors and more than ten percent shareholders
("Insiders") to file with the Securities and Exchange Commission and United
Bancorp reports of their ownership of United Bancorp securities. Based upon
written representations and copies of reports furnished to United Bancorp by
Insiders, all Section 16 reporting requirements applicable to Insiders during
2006 were satisfied on a timely basis.
SHAREHOLDER PROPOSALS FOR NEXT ANNUAL MEETING
Shareholders may submit proposals appropriate for shareholder action
at the Corporation's Annual Meeting consistent with the regulations of the
Securities and Exchange Commission. For proposals to be considered for inclusion
in the Proxy Statement for the 2008 Annual Meeting, they must be received by the
Corporation no later than November 27, 2007. Such proposals should be directed
to United Bancorp, Inc., Attention: Chief Executive Officer, 201 South Fourth
Street, Martins Ferry, Ohio 43935. Pursuant to the Corporation's Code of
Regulations, the latest possible cut-off for any shareholder to propose a matter
to be acted upon at the 2008 Annual Meeting of Shareholders is the close of
business on the 10th day following the day on which such notice of the date of
the meeting was mailed. If notice has not been provided by that date, the
business may not be considered at the Annual Meeting. In addition, the proxy
cards delivered in connection with next year's Annual Meeting will confer
discretionary voting authority, to be exercised in the judgment of the
Corporation's Board of Directors, with respect to any shareholder proposal
received less than 45 days prior to the anniversary of the mailing date of this
year's proxy materials, which deadline will fall on or around February 11, 2008.
The Corporation also retains its authority to discretionarily vote proxies with
respect to shareholder proposals received after November 27, 2007 but prior to
February 11, 2008, unless the proposing shareholder takes the necessary steps
outlined in Rule 14a-4(c)(2) under the Securities Exchange Act of 1934 to ensure
the proper delivery of proxy materials related to the proposal.
In order to make a director nomination at a shareholder meeting, it is
necessary that you notify United Bancorp not less than 40 days nor more than 60
days prior to the date of the meeting. In addition, the notice must meet all
other requirements contained in the Company's Code of Regulations.
SELECTION OF AUDITORS
For the fiscal year ended December 31, 2006, Grant Thornton LLP
("Grant Thornton") served the Corporation as independent auditor. The Audit
Committee has retained Grant Thornton as United Bancorp's independent auditor
for fiscal year 2007. We expect representatives of Grant Thornton to be present
at the Annual Meeting with the opportunity to make statements if they so desire
and to be available to respond to appropriate questions raised at the Annual
Meeting.
OTHER BUSINESS
Management is not aware of any other matter which may be presented for
action at the meeting other than the matters set forth herein. Should any matter
other than those set forth herein be presented for a vote of the shareholders,
the proxy in the enclosed form directs the persons voting such proxy to vote in
accordance with their judgment.
ANNUAL REPORT TO SHAREHOLDERS
United Bancorp's Annual Report for its fiscal year ended December 31,
2006 accompanies this Proxy Statement but is not part of our proxy soliciting
material. You may obtain additional copies of our Annual Report by requesting
them from Norman F. Assenza, Jr., United Bancorp's Secretary. A library of
United Bancorp's annual reports can be accessed on the Corporation's website at
www.unitedbancorp.com.
WE URGE YOU TO SIGN AND RETURN THE ENCLOSED PROXY FORM AS PROMPTLY AS
POSSIBLE OR VOTE VIA PHONE OR INTERNET WHETHER OR NOT YOU PLAN TO ATTEND THE
MEETING IN PERSON.
ANNUAL MEETING OF SHAREHOLDERS OF
UNITED BANCORP, INC.
APRIL 18, 2007
Please date, sign and mail
your proxy card in the
envelope provided as soon
as possible.
Please detach along perforated line and mail in the envelope provided.
20400000000000000000 4 041807
----------------------------------------------------------------------------------------------------------------------------
PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE [X]
----------------------------------------------------------------------------------------------------------------------------
1. To Elect as Directors the Nominees 2. Upon the direction of the Board of Directors, the proxy holders
Set Forth at Below: are authorized to vote upon such other business as may properly
come before the Annual Meeting.
NOMINEES:
[ ] FOR ALL NOMINEES [ ] James W. Everson THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE
[ ] John M. Hoopingarner ELECTION OF THE DIRECTORS NOMINATED BY THE BOARD OF DIRECTORS. THIS
[ ] Richard L. Riesbeck PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
[ ] WITHHOLD AUTHORITY [ ] Matthew C. Thomas HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THE
FOR ALL NOMINEES PROXY WILL BE VOTED FOR THE ELECTION OF THE DIRECTORS NOMINATED BY
THE BOARD OF DIRECTORS.
[ ] FOR ALL EXCEPT
(See instructions below) YOUR VOTE IS IMPORTANT. PLEASE MARK, SIGN, DATE AND MAIL THIS PROXY
FORM WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING. A RETURN
INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE.
INDIVIDUAL NOMINEE(S), MARK "FOR ALL
EXCEPT" AND FILL IN THE CIRCLE NEXT TO
EACH NOMINEE YOU WISH TO WITHHOLD, AS
SHOWN HERE: [X]
-----------------------------------------------------
To change the address on your account, please
check the box at right and indicate your new
address in the address space above. Please note [ ]
that changes to the registered name(s) on the
account may not be submitted via this method.
-----------------------------------------------------
Signature of Shareholder Date: Signature of Shareholder Date:
------------------ ------------ ------------------ -----------
NOTE: Please sign exactly as your name or names appear on this Proxy. When shares are held jointly, each holder should
sign. When signing as executor, administrator, attorney, trustee or guardian, please give full title as such. If
the signer is a corporation, please sign full corporate name by duly authorized officer, giving full title as
such. If signer is a partnership, please sign in partnership name by authorized person.
UNITED BANCORP, INC.
PROXY ANNUAL MEETING
APRIL 18, 2007
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
The undersigned hereby appoint Mr. John M. Hoopingarner, Mr. Terry A.
McGhee and Mr. Richard L. Riesbeck as Proxies, each with the power to appoint
his substitute, and hereby authorize each of them to represent and to vote, as
designated on the reverse side, all the common shares of United Bancorp, Inc.
held of record by the undersigned on March 9, 2007, at the Annual Meeting of
Shareholders to be held on April 18, 2007, or any adjournment thereof.
(CONTINUED AND TO BE SIGNED ON THE REVERSE SIDE.)
14475
ANNUAL MEETING OF SHAREHOLDERS OF
UNITED BANCORP, INC.
APRIL 18, 2007
PROXY VOTING INSTRUCTIONS
MAIL - Date, sign and mail your proxy card in the
envelope provided as soon as possible.
- OR -
TELEPHONE - Call toll-free 1-800-PROXIES from any COMPANY NUMBER _______________________
touch-tone telephone and follow the instructions.
Have your proxy card available when you call. ACCOUNT NUMBER _______________________
- OR -
INTERNET - Access "WWW.VOTEPROXY.COM" and follow the
on-screen instructions. Have your proxy card
available when you access the web page.
----------------------------------------------------------------------------------------------------------------------------
You may enter your voting instructions at 1-800-PROXIES or www.voteproxy.com up until 11:59 PM Eastern Time the day before
the cut-off or meeting date.
----------------------------------------------------------------------------------------------------------------------------
Please detach along perforated line and mail in the envelope provided IF you are not voting via telephone or the Internet.
20400000000000000000 4 041807
----------------------------------------------------------------------------------------------------------------------------
PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE [X]
----------------------------------------------------------------------------------------------------------------------------
1. To Elect as Directors the Nominees Set Forth at 2. Upon the direction of the Board of Directors, the proxy holders
Below: are authorized to vote upon such other business as may properly
come before the Annual Meeting.
NOMINEES:
[ ] FOR ALL NOMINEES [ ] James W. Everson THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" THE
[ ] John M. Hoopingarner ELECTION OF THE DIRECTORS NOMINATED BY THE BOARD OF DIRECTORS. THIS
[ ] Richard L. Riesbeck PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED
[ ] WITHHOLD AUTHORITY [ ] Matthew C. Thomas HEREIN BY THE UNDERSIGNED SHAREHOLDER. IF NO DIRECTION IS MADE, THE
FOR ALL NOMINEES PROXY WILL BE VOTED FOR THE ELECTION OF THE DIRECTORS NOMINATED BY
THE BOARD OF DIRECTORS.
[ ] FOR ALL EXCEPT
(See instructions below) YOUR VOTE IS IMPORTANT. PLEASE MARK, SIGN, DATE AND MAIL THIS PROXY
FORM WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING. A RETURN
INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE.
INDIVIDUAL NOMINEE(S), MARK "FOR ALL
EXCEPT" AND FILL IN THE CIRCLE NEXT TO
EACH NOMINEE YOU WISH TO WITHHOLD, AS
SHOWN HERE: [X]
-----------------------------------------------------
To change the address on your account, please
check the box at right and indicate your new
address in the address space above. Please note [ ]
that changes to the registered name(s) on the
account may not be submitted via this method.
-----------------------------------------------------
Signature of Shareholder Date: Signature of Shareholder Date:
------------------ ------------ ------------------ -----------
NOTE: Please sign exactly as your name or names appear on this Proxy. When shares are held jointly, each holder should
sign. When signing as executor, administrator, attorney, trustee or guardian, please give full title as such. If
the signer is a corporation, please sign full corporate name by duly authorized officer, giving full title as
such. If signer is a partnership, please sign in partnership name by authorized person.