UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 14A
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:
[_] 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 Material Pursuant to (S) 240.14a-11(c) or (S) 240.14a-12
United Bankshares, Inc.
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[x] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(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):
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(5) Total fee paid:
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[_] 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:
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(2) Form, Schedule or Registration Statement No.:
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(4) Date Filed:
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Notes:
Reg. (S) 240.14a-101.
SEC 1913 (3-99)
[LOGO] U N I T E D
BANKSHARES, INC.
THE CHALLENGE TO BE THE BEST NEVER ENDS
UNITED BANKSHARES, INC.
P. O. BOX 1508
UNITED SQUARE
FIFTH AND AVERY STREETS
PARKERSBURG, WEST VIRGINIA 26101
NOTICE OF 2002 ANNUAL MEETING OF SHAREHOLDERS
TO THE SHAREHOLDERS
NOTICE IS HEREBY GIVEN that, pursuant to the call of its Board of
Directors, the 2002 Annual Meeting of Shareholders of UNITED BANKSHARES, INC.
("United") will be held at The University of Charleston, 2300 MacCorkle Avenue,
S.E., Charleston, West Virginia on Monday, May 20, 2002, at 4:00 p.m., local
time, for the purpose of considering and voting upon the following matters:
1. To elect eighteen (18) persons to serve as directors of United. The
nominees selected by the current Board of Directors are listed in the
accompanying Proxy Statement for this Annual Meeting.
2. To act upon any other business which may properly come before this
Annual Meeting or any adjournment or adjournments thereof. The Board of
Directors at present knows of no other business to come before this Annual
Meeting.
The close of business on April 1, 2002 has been fixed by the Board of
Directors as the record date for determining shareholders entitled to notice of
and to vote at this Annual Meeting.
WE URGE YOU TO SIGN AND RETURN THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE
REGARDLESS OF YOUR PLANS TO ATTEND THIS MEETING. IF YOU DO ATTEND, YOU MAY
WITHDRAW YOUR PROXY AND VOTE IN PERSON.
TWO INDIVIDUALS, WHO ARE NOT DIRECTORS OF UNITED, HAVE BEEN NAMED IN THE
PROXY TO VOTE THE SHARES REPRESENTED BY PROXY, IF YOU WISH TO CHOOSE SOME OTHER
PERSON TO ACT AS YOUR PROXY, MARK OUT THE PRINTED NAME AND WRITE IN THE NAME OF
THE PERSON YOU SELECT.
By Order of the Board of Directors
/s/ Richard M. Adams
Richard M. Adams
Chairman of the Board and
Chief Executive Officer
April 8, 2002
United Bankshares, Inc.
United Square
Fifth and Avery Streets
Parkersburg, West Virginia 26101
PROXY STATEMENT
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These proxy materials are delivered in connection with the solicitation by
the Board of Directors of United Bankshares, Inc. ("United," the "Company,"
"we," or "us"), a West Virginia corporation, of proxies to be voted at our 2002
Annual Meeting of Shareholders and at any adjournment or postponement.
You are invited to attend our Annual Meeting of Shareholders on May 20,
2002, beginning at 4:00 p.m. The Meeting will be held at The University of
Charleston, 2300 MacCorkle Avenue, S.E., Charleston, West Virginia.
This Proxy Statement, form of proxy and voting instructions are being
mailed on or about April 8, 2002.
Shareholders Entitled to Vote
Holders of record of United common shares at the close of business on April
1, 2002 are entitled to receive this notice and to vote their shares at the
Annual Meeting. As of that date, there were 42,809,326 common shares
outstanding. Each common share is entitled to one vote on each matter properly
brought before the Meeting.
Proxies
Your vote is important. Shareholders of record may vote their proxies by
mail or in person. A postage-paid envelope is provided for voting by mail.
Proxies may be revoked at any time before they are exercised by (1) written
notice to the Secretary of the Company, (2) timely delivery of a valid,
later-dated proxy or (3) voting at the Annual Meeting.
You may save us the expense of a second mailing by voting promptly. Choose
one of the following voting methods to cast your vote.
Vote By Mail
If you choose to vote by mail, simply mark your proxy, date and sign it,
and return it to us in the postage-paid envelope provided.
Vote at the Annual Meeting
The method by which you vote now will in no way limit your right to vote at
the Annual Meeting if you later decide to attend in person. If your shares are
held in the name of a bank, broker or other holder of record, you must obtain a
proxy, executed in your favor, from the holder of record to be able to vote at
the Meeting.
All shares that have been properly voted and not revoked will be voted at
the Annual Meeting in accordance with your instructions. If you sign your proxy
card but do not give voting instructions, the shares represented by that proxy
will be voted as recommended by the Board of Directors.
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PROPOSAL 1: ELECTION OF DIRECTORS
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The Board of Directors consists of one class of eighteen (18) directors.
Eighteen (18) directors will be elected at our 2002 Annual Meeting to serve for
a one-year term expiring at our Annual Meeting in the year 2003. The Company's
Bylaws provide that the number of directors shall be at least five (5) and no
more than thirty-five (35) with the composition and number of nominees to be set
at the discretion of the Board of Directors. For the election of directors at
the 2002 Annual Meeting, the Board of Directors established the composition and
number of nominees to be elected at eighteen (18).
The persons named in the enclosed proxy intend to vote the proxy for the
election of each of the eighteen (18) nominees, unless you indicate on the proxy
card that your vote should be withheld from any or all of such nominees. Each
nominee elected as a director will continue in office until his successor has
been elected or until his death, resignation or retirement.
The Board of Directors has proposed the following nominees for election as
directors with terms expiring in 2003 at the Annual Meeting: Richard M. Adams,
Robert G. Astorg, Thomas J. Blair, III, Joseph S. Bracewell, Harry L. Buch, W.
Gaston Caperton, III, H. Smoot Fahlgren, Theodore J. Georgelas, F. T. Graff,
Jr., Alan E. Groover, Russell L. Isaacs, John M. McMahon, G. Ogden Nutting,
William C. Pitt, III, I. N. Smith, Jr., Warren A. Thornhill, III, P. Clinton
Winter, Jr., and James W. Word, Jr.
The Board of Directors recommends a vote "FOR" the election of each of
these nominees for director.
We expect each nominee for election as a director to be able to serve if
elected. If any nominee is not able to serve, proxies will be voted in favor of
the remainder of those nominated and may be voted for substitute nominees,
unless the Board chooses to reduce the number of directors serving on the Board.
The principal occupation and certain other information about the nominees
for director are set forth on the following pages.
Family Relationships
H. Smoot Fahlgren is the father-in-law of F. T. Graff, Jr.
Security Ownership of Directors and Officers
As of April 1, 2002, directors and the named executive officers of the
Company:
owned beneficially, directly or indirectly, the number of shares
of common stock indicated; and
held the number of options exercisable within sixty (60) days
after that date, to purchase the number of shares indicated
pursuant to the Company's Stock Option Plans.
All directors and executive officers as a group owned 6,657,124 shares or
15.38% of the Company's common stock.
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NOMINEES FOR DIRECTORS WHOSE TERMS EXPIRE IN 2002
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Amount of Beneficial
Name and Age as of the Position, Principal Occupation, Ownership of Shares of
May 20, 2002 Meeting Date Business Experience and Directorships/(a)/ Common Stock and Options
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Shares/(b)/ Options/(c)/ %
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Richard M. Adams ........ 55 Chairman and Chief Executive Officer of 492,645 201,856 1.60%
both United and United Bank (WV). Director
of the Company since 1984.
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Robert G. Astorg ........ 58 CPA and Managing Director of American 25,895 - *
Express Tax and Business Services, Inc.
Member of Astorg, Weyer & Daugherty,
P.L.L.C.; Director of the Company since
1991.
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Thomas J. Blair, III .... 70 Consulting Engineer and former President 167,510 - *
and Chief Executive Officer of Kelley,
Gidley, Blair & Wolfe, Inc. Director of the
Company since 1988.
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Joseph S. Bracewell ..... 55 Former Chairman of the Board, President and 91,126 - *
Chief Executive Officer of Century
Bancshares, Inc. Vice-Chairman of United
Bank (VA). Director of the Company since
2001.
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Harry L. Buch............ 71 Attorney and Partner with Bailey, Riley, 24,126 - *
Buch & Harman. Former partner with
Gompers, Buch, McCarthy & McLure. Director
of the Company since 1990.
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W. Gaston Caperton, III.. 62 President of The College Board. Director of 24,476 - *
Owens Corning. President of the Caperton
Group. Former Governor of West Virginia.
Director of the Company since 1997.
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H. Smoot Fahlgren ....... 71 Chairman of the Board of Fahlgren, Inc. 356,808 - *
Director of the Company since 1984.
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Theodore J. Georgelas ... 55 President of Georgelas & Sons, Inc. 47,914 - *
Chairman of the Board of Sector
Communications. Former Chairman of the
Board of United Bank (VA). Director of the
Company since 1990.
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F. T. Graff, Jr ......... 63 Attorney and Managing Partner of Bowles 24,000 - *
Rice McDavid Graff & Love PLLC. Director
of the Company since 1984.
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Alan E. Groover ......... 54 Former Chairman of the Board, President and 97,003 - *
Chief Executive Officer of Fed One Bancorp,
Inc. Director of the Company since 1998.
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NOMINEES FOR DIRECTORS WHOSE TERMS EXPIRE IN 2002
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Amount of Beneficial
Name and Age as of the Position, Principal Occupation, Ownership of Shares of
May 20, 2002 Meeting Date Business Experience and Directorships/(a)/ Common Stock and Options
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Shares/(b)/ Options/(c)/ %
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Russell L. Isaacs .........69 Owner of Russell L. Isaacs and Company. 40,716 - *
Director of the Company since 1984.
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John M. McMahon ...........61 Chairman of the Board of Miller & Long Co., 239,025 - *
Inc. Director of United Bank (VA). Director
of the Company since 1998.
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G. Ogden Nutting ..........66 President of The Ogden Newspapers, Inc. 654,656 - 1.51%
Director of the Company since 1986.
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William C. Pitt, III ......57 Hotel and Resort Developer. Director of the 3,250 - *
Company since 1987.
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I. N. Smith, Jr. ..........69 Consultant for United. Former President of 377,153 - *
United. Former President of United Bank
(WV). Director of the Company since 1986.
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Warren A. Thornhill, III ..73 Attorney at Law. Director of the Company 449,454 - 1.04%
since 1992.
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P. Clinton Winter, Jr .....54 President of Bray & Oakley Insurance Agency. 551,754 - 1.27%
Director of the Company since 1996.
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James W. Word, Jr .........78 President of Beckley Loan Company. Vice 128,878 - *
President of Beckley Loan and Industrial
Corporation. Director of the Company since
1992.
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All Directors, Nominees and 6,182,375 474,749 15.38%
Executive Officers as a Group
(25 persons)
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* Indicates the director owns less than 1% of United's issued and outstanding
shares.
(a) Effective March 22, 2002, United National Bank (UNB) converted its
national bank charter to a West Virginia state charter under the name
United Bank, Inc. References in this proxy statement to United and its
subsidiaries are as follows:United - United Bankshares, Inc.; United
Bank (WV) - United Bank, Inc., a West Virginia corporation; and United
Bank (VA) - United Bank, Inc., a Virginia corporation.
(b) Includes shares held by United Bank's (WV) Trust Department as follows:
Mr. Adams, 46,554 shares; Mr. Astorg, 6,035 shares; Mr. Buch, 12,600
shares; Mr. Fahlgren, 356,808 shares; Mr. Graff, 20,000 shares; Mr.
Smith, 369,144 shares; non-director executive officers as a group,
36,180 shares; and 2,181,523 shares in which the voting authority is
exercised by United Bank's (WV) Board of Directors.
(c) Includes shares of Common Stock that may be acquired within sixty
(60) days of April 1, 2002 through the exercise of stock options
pursuant to United's Stock Option Plans.
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Voting of Other Matters
If any other matters are properly presented for consideration at the Annual
Meeting, the persons named in the enclosed form of proxy will have the
discretion to vote on those matters for you. At the date this proxy statement
went to press, we do not know of any other matter to be raised at the Annual
Meeting.
Required Vote
The presence, in person or by proxy, of the holders of a majority of the
votes entitled to vote at the Annual Meeting is necessary to constitute a
quorum. Abstentions and broker "non-votes" are counted as present and entitled
to vote for purposes of determining a quorum. A broker "non-vote" occurs when a
nominee holding shares for a beneficial owner does not vote on a particular
proposal because the nominee does not have discretionary voting power for that
particular item and has not received instructions from the beneficial owner.
A plurality of the votes cast is required for the election of directors.
Abstentions and broker "non-votes" are not counted for purposes of the election
of directors.
In the election of directors, shareholders cast one (1) vote for each
nominee for each share held. However, every shareholder has the right of
cumulative voting, in person or by proxy, in the election of directors.
Cumulative voting gives each shareholder the right to aggregate all votes which
he or she is entitled to cast in the election of directors and to cast all such
votes for one candidate or distribute them among as many candidates and in such
a manner as the shareholder desires.
At our 2002 Annual Meeting, the number of directors to be elected is
eighteen (18). Each shareholder has the right to cast eighteen (18) votes in the
election of directors for each share of stock held on the record date. If you
wish to exercise, by proxy, your right to cumulative voting in the election of
directors, you must provide a proxy showing how your votes are to be distributed
among one or more candidates. Unless contrary instructions are given by a
shareholder who signs and returns a proxy, all votes for the election of
directors represented by such proxy will be divided equally among the eighteen
(18) nominees. If cumulative voting is invoked by any shareholder, the vote
represented by the proxies delivered pursuant to this solicitation, which do not
contain contrary instructions, may be cumulated at the discretion of the Board
of Directors of United Bankshares, Inc. in order to elect to the Board of
Directors the maximum nominees named in this proxy statement.
On the record date, there were 42,809,326 shares of common stock
outstanding that are held by approximately 11,474 shareholders of record. A
majority of the outstanding shares of United Bankshares, Inc. will constitute a
quorum at the meeting.
Cost of Proxy Solicitation
We will pay the expenses of soliciting proxies. Proxies may be solicited on
our behalf by directors, officers or employees in person or by telephone,
electronic transmission, facsimile transmission or by telegram. Brokers,
fiduciaries, custodians and other nominees have been requested to forward
solicitation materials to the beneficial owners of the Company's common stock.
Upon request we will reimburse these entities for their reasonable expenses.
In order to facilitate and expedite distribution of these proxy
solicitation materials to brokers, fiduciaries, custodians, nominee holders and
institutional investors, United has retained Georgeson Shareholder - New Jersey
of Carlstadt, New Jersey ("Georgeson"). Pursuant to a retention letter dated
March 1, 2002, Georgeson will contact all broker and other nominee accounts
identified on United's shareholder mailing list in order to facilitate
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determination of the number of sets of proxy materials such accounts require for
purposes of forwarding the same to the beneficial owners. Georgeson will then
assist in the delivery of proxy materials to these accounts for distribution.
Georgeson will also assist in the distribution of proxy materials to
institutional investors. Georgeson will follow-up with the brokers, other
nominee accounts and institutional investors, requesting return of proxies.
United is not retaining Georgeson to solicit proxies from registered holders or
from non-objecting beneficial owners. Georgeson's fee for the above services is
$3,500 plus reasonable disbursements that may include the broker search,
printing, postage, courier charges, filing reports, data transmissions and other
expenses approved by United.
Shareholder Account Maintenance
Mellon Investor Services LLC acts as our Transfer Agent. All communications
concerning accounts of shareholders of record, including address changes, name
changes, inquiries as to requirements to transfer common shares and similar
issues can be handled by contacting the Shareholder Relations Department, (304)
424-8800, or by writing to us at the corporate offices located at United Square,
Fifth and Avery Streets, Parkersburg, West Virginia 26101.
Section 16(a) Beneficial Ownership
Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 requires our directors
and executive officers to file reports of holdings and transactions in United
shares with the Securities and Exchange Commission ("SEC"). To our knowledge,
based solely on our review of the copies of such reports furnished and written
representations that no other reports were required during 2001, we believe that
in 2001 our directors and executive officers met all applicable SEC filing
requirements.
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PRINCIPAL STOCKHOLDERS
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Principal Shareholder of United
The following table lists each shareholder of United who is the beneficial
owner of more than 5% of United's common stock, the only class of stock
outstanding, as of April 1, 2002.
Amount and Nature of Percent of
Title of Class Name and Address of Beneficial Owner Beneficial Ownership (1) Class
-------------- ------------------------------------ ---------------------- ----------
Common Stock United Bank (WV) Trust Department 2,181,523 5.04%
514 Market Street, Parkersburg, WV 26101
(2,181,523 shares or 5.04% are registered
under the nominee name of Parbanc
Co.)
(1) United Bank (WV) is a wholly-owned subsidiary of United and its Trust
Department holds in fiduciary or agency capacity 3,028,844 shares or 6.98%
of United's stock. The investment authority for these shares is held by the
Trust Department and is exercised by United Bank's (WV) Board of Directors.
Of these total shares, sole voting authority for 2,181,523 shares or 5.04%
of United's outstanding common stock is held by the Trust Department and is
exercised by United Bank's (WV) Board of Directors.
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GOVERNANCE OF THE COMPANY
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Board and Committee Membership
During 2001, the Board of Directors met six (6) times. The Board of
Directors of the Company has three (3) standing committees: The Executive
Committee, Audit Committee and Compensation Committee. During 2001, each
director attended 75% or more of the aggregate of the total number of meetings
of the Board of Directors and all committees of the Board on which he served
except W. Gaston Caperton, III, Theodore J. Georgelas, Alan E. Groover, John M.
McMahon and William C. Pitt, III.
The Executive Committee
During 2001, the Executive Committee was comprised of thirteen (13)
directors, Richard M. Adams, Chairman, Thomas J. Blair, III, Harry L. Buch, W.
Gaston Caperton, III, H. Smoot Fahlgren, Theodore J. Georgelas, F. T. Graff,
Jr., Russell L. Isaacs, John M. McMahon, G. Ogden Nutting, William C. Pitt, III,
I. N. Smith, Jr., and Warren A. Thornhill, III. The Executive Committee makes
recommendations regarding nominees to the Board of Directors, and is responsible
for the management of the budget, development of policies and implementation of
such policies and review of personnel and salaries. The Executive Committee
performs such duties and exercises the powers delegated to it by the Board of
Directors. During 2001, the Executive Committee met three (3) times.
The Audit Committee
The Audit Committee has the primary responsibility to review and evaluate
significant matters relating to audit, internal control and compliance. It
reviews, with representatives of the independent auditors, the scope and results
of the examination of financial statements, audit fees and any recommendations
with respect to internal controls and financial matters. This committee is also
responsible for monitoring trust activities, including the review of the assets
in each trust as to their safety and current value, and the advisability of
retaining or disposing of such assets. During 2001, members of this committee
were Robert G. Astorg, Chairman, P. Clinton Winter, Jr., and James W. Word, Jr.,
and R. Terry Butcher, who is a director of one of United's subsidiary banks. The
Audit Committee met four (4) times.
Compensation Committee
The Compensation Committee makes recommendations regarding officer
compensation and budgetary matters to the Board of Directors. During 2001,
members of this committee were Thomas J. Blair, III, Harry L. Buch, W. Gaston
Caperton, III, H. Smoot Fahlgren, Theodore J. Georgelas, F. T. Graff, Jr.,
Russell L. Isaacs, Chairman, John M. McMahon, G. Ogden Nutting, William C. Pitt,
III, and Warren A. Thornhill, III. The Compensation Committee met one (1) time
during the year.
Related Transactions
United's subsidiaries have had, and expect to have in the future, banking
transactions with United and with its officers, directors, principal
shareholders, or their interests (entities in which they have more than a 10%
interest). The transactions were in the ordinary course of business and, with
respect to loans, were made on substantially the same terms, including interest
rates, collateral and repayment terms as those prevailing at the time for
comparable transactions. United's subsidiary banks are subject to federal
statutes and regulations governing loans to officers and directors and extend
loans in compliance with such laws and only with the approval of the Board of
Directors.
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H. Smoot Fahlgren, a member of the Board of Directors of United, is
Chairman of Fahlgren, Inc., an advertising agency with its headquarters in
Parkersburg, West Virginia. The agency has provided the advertising for United
since 1978. During 2001, payment for the advertising by United to Fahlgren, Inc.
was less than 5% of that firm's revenues during the year 2001.
F. T. Graff, Jr., a member of the Board of Directors of United, is a
partner in the law firm of Bowles Rice McDavid Graff & Love PLLC in Charleston,
West Virginia. Bowles Rice McDavid Graff & Love PLLC rendered legal services to
United and United Bank (WV) during 2001 and it is expected that the firm will
continue to render certain services to both in the future. The fees paid to
Bowles Rice McDavid Graff & Love PLLC represent less than 5% of that firm's
revenues for the year 2001.
United Bank (WV) leases land to construct an approved but unopened
Charleston branch from the Kanawha-Roxalana Company pursuant to a written lease
agreement dated November 28, 2001 (the "Kanawha City Lease"). The
Kanawha-Roxalana Company is a shareholder of United, and the voting and
investment authority for its shares are beneficially owned by its President and
Chief Executive Officer, I.N. Smith, Jr. who is a director of United. The
Kanawha City Lease provides for an initial term of twenty-five (25) years
commencing on December 1, 2001, with five (5) additional five (5) year renewal
options after expiration of the initial twenty-five (25) year term. The Kanawha
City Lease provides for the base rent to be paid by United Bank (WV) to be
adjusted on December 1, 2006, and every five years thereafter following the
commencement and any renewal option properly exercised by United Bank (WV). The
adjusted amount of rent shall be calculated based on changes in the Consumer
Price Index of the United States Bureau of Labor Statistics. Additionally, the
Kanawha City Lease provides an option for United Bank (WV) to purchase the
property after the expiration of the initial twenty-five year term at a purchase
price equal to the average of three separate appraisals. Upon the expiration of
the Kanawha City Lease for any cause, all improvements and structures shall
become the property of the Kanawha-Roxalana Company. Management believes the
Kanawha City Lease is on terms comparable to market terms for similar rental
space in Charleston, West Virginia. United Bank (WV) anticipates the
construction of the branch premises to be completed during the second quarter of
2002 with the branch opening shortly thereafter.
United Bank (WV) leases one of its Wheeling drive-in facilities from The
Ogden Newspapers, Inc. pursuant to a written lease agreement dated August 1,
2000 (the "Wheeling Lease"). The Ogden Newspapers, Inc. is a shareholder of
United, and the voting and investment authority for its shares are beneficially
owned by its President, G. Ogden Nutting who is a director of United. Management
believes the Wheeling Lease is on terms comparable to market terms for similar
rental space in Wheeling, West Virginia. The Wheeling Lease provides for an
initial term of ten (10) years with two (2) successive options to renew and
extend the terms of the Lease for ten (10) additional years each. Additionally,
the Wheeling Lease provides that The Ogden Newspapers, Inc. may, at its option,
terminate the Lease upon nine (9) months advance written notice to United Bank
(WV). Previously, United had leased its Wheeling branch premises and the
drive-in facility from The Ogden Newspapers, Inc. pursuant to a written lease
agreement dated August 1, 1979. The Wheeling Lease supercedes the prior lease
agreements and only pertains to United Bank (WV)'s lease of the drive-in
facility; United Bank (WV) no longer leases the Wheeling branch premises from
The Ogden Newspapers, Inc.
In addition, during the year subsidiaries of United advertised, at market
rates, in newspapers published by The Ogden Newspaper, Inc. The fees paid in
such advertising and the rent paid to The Ogden Newspapers, Inc. represent less
than 5% of that firm's revenue for the year 2000.
8
Directors Fees
Non-employee directors of the Company receive a retainer of $675 per month
regardless of meeting attendance.
Each non-employee director who serves on the Executive and Compensation
Committees receives a fee of $675 for each United Board Committee Meeting
attended except for Mr. Isaacs. Mr. Isaacs, as Chairman of the Compensation
Committee, receives a retainer payment of $675 per quarter without regard to
committee meeting attendance. Except for Mr. Astorg, each outside director who
serves on the Audit Committee receives a fee of $675 for each committee meeting
attended. Mr. Astorg, as Chairman of the Audit Committee, receives a retainer
payment of $675 per month without regard to committee meeting attendance.
Beneficial Ownership of Named Executive Officers
The following table sets forth certain information regarding the named
executive's beneficial ownership of common stock of United as of April 1, 2002:
Shares of Common
Stock of the Company
Beneficially Owned (1)
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Title of Class Name of Officer Number of Shares Percent of Class
-------------- --------------- -------------------- ------------------
Common Stock Richard M. Adams 694,501 1.60%
Common Stock Steven E. Wilson 143,516 0.33%
Common Stock James B. Hayhurst, Jr. 109,749 0.25%
Common Stock Kendal E. Carson 29,229 0.07%
Common Stock Joe L. Wilson 103,426 0.24%
(1) The amounts shown represent the total shares owned directly by such named
executive officers together with shares, which are owned indirectly. The
direct shares include shares that are issuable upon the exercise of all
stock options currently exercisable. These individuals have the right to
acquire the shares indicated after their names, upon exercise of such stock
options: Mr. Adams, 201,856; Mr. S. Wilson, 51,056; Mr. Hayhurst, 65,915;
Mr. Carson, 28,250; and Mr. J. Wilson, 47,837. The indirect shares include
those shares owned by spouses and immediate family members, shares held in
trust in which the executive is a beneficiary, and shares held by a
corporation which the executive controls.
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EXECUTIVE COMPENSATION
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Cash Compensation
The following table is a summary of certain information concerning the
compensation awarded or paid to, or earned by, the Company's chief executive
officer and each of the Company's other four most highly compensated executive
officers during the last three fiscal years.
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Summary Compensation Table
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Long-term
Annual Compensation Compensation
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Securities All Other
Name and Other Compen- Underlying Compen-
Principal Position Year Salary ($) Bonus ($) sation ($)/(1)/ Options (#) sation ($)/(2)/
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Richard M. Adams 2001 476,608 260,000 0 30,000 6,600
Chairman of the Board and
Chief Executive Officer 2000 446,600 300,000 0 24,000 4,250
1999 419,832 250,000 0 24,000 4,000
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Steven E. Wilson 2001 204,808 81,000 0 14,400 6,607
Executive Vice President, Chief
Financial Officer and Treasurer 2000 198,833 85,000 0 12,000 6,620
1999 190,151 76,000 0 12,000 4,000
-----------------------------------------------------------------------------------------------------------------------
James B. Hayhurst, Jr. 2001 179,850 42,000 0 9,000 5,062
Executive Vice President
2000 176,167 50,000 0 7,500 5,565
1999 169,622 48,000 0 7,500 4,000
-----------------------------------------------------------------------------------------------------------------------
Kendal E. Carson 2001 177,083 42,000 0 9,000 4,427
Executive Vice President
2000 165,001 45,000 0 7,500 5,031
-----------------------------------------------------------------------------------------------------------------------
Joe L. Wilson 2001 169,792 42,000 0 9,000 5,115
Executive Vice President
2000 165,833 47,000 0 7,500 5,321
1999 157,163 45,000 0 7,500 4,000
-----------------------------------------------------------------------------------------------------------------------
(1) The aggregate value of all perquisites and other personal benefits
did not exceed either $50,000 or 10% of the total annual salary and
bonus reported for the named executive officers; therefore, no
disclosure has been made.
(2) The amounts included in "All Other Compensation" consist entirely of
United's contributions on behalf of the listed officers to the 401(K)
Plan.
10
STOCK OPTION GRANTS IN 2001
The following table sets forth information concerning individual grants of
options to purchase the Company's Common Stock made to the named executives in
2001.
----------------------------------------------------------------------------------------------------------------------
Stock Option Grants in Last Fiscal Year
----------------------------------------------------------------------------------------------------------------------
Number of % of Total
Securities Options Granted Exercise of Base Expiration Grant Date
Name Underlying Options to All Employees Price ($/Share) Date Present Value ($)
Granted (#) in Fiscal Year (2)
----------------------------------------------------------------------------------------------------------------------
Richard M. Adams 30,000 /(1)/ 11.57% 27.12 11/01/2011 166,200
----------------------------------------------------------------------------------------------------------------------
Steven E. Wilson 14,400 /(1)/ 5.56% 27.12 11/01/2011 79,776
----------------------------------------------------------------------------------------------------------------------
James B. Hayhurst, Jr. 9,000 /(1)/ 3.47% 27.12 11/01/2011 49,860
----------------------------------------------------------------------------------------------------------------------
Kendal E. Carson 9,000 /(1)/ 3.47% 27.12 11/01/2011 49,860
----------------------------------------------------------------------------------------------------------------------
Joe L. Wilson 9,000 /(1)/ 3.47% 27.12 11/01/2011 49,860
----------------------------------------------------------------------------------------------------------------------
(1) Granted under the 2001 Incentive Stock Option Plan. The option exercise
price is the market value of United's stock at the date the option was
granted. All options granted under this plan are exercisable in accordance
with a three-year vesting schedule: 50% after the first year; 75% after the
second year; and 100% after three years.
(2) Calculated using the Black-Scholes pricing model. The assumptions used in
determining the valuation of these options using this methodology are as
follows: average expected life of options of 7 years; risk-free interest
rate of 4.86%; a volatility factor of .217; and a dividend yield of 3.43%.
STOCK OPTION EXERCISES AND YEAR-END VALUE TABLE
The following table sets forth certain information regarding individual
exercises of stock options during 2001 by each of the named executives.
-----------------------------------------------------------------------------------------------------------------------------
Aggregate Stock Option Exercises in Last Fiscal Year and FY-End Stock Option Plan
---------------------------------------------------------------------------------------------------
Value of Unexercised
Number of Unexercised Stock In-the-Money Stock Options at
Shares Options at FY-End # FY-End ($)
Name Acquired on Value --------------------------------------------------------------------
Exercise (#) Realized($) Exercisable/Unexercisable Exercisable/Unexercisable
-----------------------------------------------------------------------------------------------------------------------------
Richard M. Adams 30,000 630,300 201,856/48,000 3,516,162/1,197,600
-----------------------------------------------------------------------------------------------------------------------------
Steven E. Wilson 0 0 51,056/23,400 1,103,083/ 582,528
-----------------------------------------------------------------------------------------------------------------------------
James B. Hayhurst, Jr. 8,000 160,960 69,915/14,625 1,170,119/ 364,080
-----------------------------------------------------------------------------------------------------------------------------
Kendal E. Carson 0 0 28,250/14,250 497,666/ 354,471
-----------------------------------------------------------------------------------------------------------------------------
Joe L. Wilson 0 0 59,837/14,625 1,049,674/ 364,080
-----------------------------------------------------------------------------------------------------------------------------
11
--------------------------------------------------------------------------------
EXECUTIVE COMPENSATION COMMITTEE REPORT
--------------------------------------------------------------------------------
Board Compensation Committee Report
The Compensation Committee is responsible for administration of United
Bankshares, Inc.'s (United's) Executive Compensation programs. This includes
recommendations related to base salary, short-term incentives and long-term
stock option incentives for all Executive Officers of the Company.
The Compensation Committee's Executive Compensation policies, developed
based on competitive information, are designed to provide competitive levels of
compensation that integrate pay with United's annual and long-term performance
goals and assist in attracting and retaining qualified executives.
Periodically the Committee retains the services of nationally recognized
compensation consulting firms to do an extensive review of the compensation
program for all Executive Officers.
Buck Consultants, a global human resources consulting firm, reported to the
Committee that the total compensation plan for Executive Officers was reasonable
and competitive in view of the Company's performance and the contribution of
those officers to that performance. The Bank Compensation Strategies Group
report indicated similar findings.
Executive Officers are paid base salaries determined by the value of their
position compared to published survey data, information gathered on competing
banks of similar size and the officer's individual performance level.
The short-term Incentive Plan stresses reward for achievement of
performance goals set each year. Each Executive Officer participates in a pool
of funds set aside for this purpose. Participation level is based on a rating
system tied to accomplishment of assigned goals as well as a specific formula,
which relates the incentive award to a percentage of salary range midpoint.
Company performance must exceed peer performance to activate compensation
incentives.
The United management team should share the same goals as its shareholders.
Toward this end, the long-term Incentive Stock Option Plan is designed to
provide an ownership opportunity to key management personnel. Stock ownership
provides an ever-important stockholder perspective necessary for successful
management of the company. Awards are based on industry guidelines, which relate
base compensation to stock price. Grant calculations are tested for
reasonableness against competitive industry data, keeping in mind cumulative
ownership targets.
Buck Consultants and the Bank Compensation Strategies Group reported that
stock option grants to Executive Officers have historically been conservative
when compared to general industry and practices for major regional banking
organizations. The most recent share allocations as a percentage of outstanding
shares have been consistent with competitive practices in the banking industry.
Peer group performance analysis is a continual process at United. Data
provided by the Federal Reserve Bank Holding Company Performance Report is
analyzed quarterly. Proxy data on an appropriate group of individual financial
institutions is used to evaluate operating performance and profitability. United
consistently performs well compared to peer. The Committee concluded that for
the year Company performance exceeded peer performance and activated
compensation incentives.
12
The Committee determined that the base pay for Richard Adams, Chief
Executive Officer, was determined to be well within a competitive market range
when compared to the published compensation survey from Watson Wyatt Data
Services and proxy data from similar size bank holding companies.
Mr. Adams was awarded a pro-rata share of the established short-term
incentive pool based on his performance rating assigned by the Committee. The
Committee concluded that total cash compensation for the position of CEO is
appropriate in view of performance levels attained for companies of similar size
as presented in a report by Buck Consultants. The Bank Compensation Strategies
Group report showed that cash compensation for the CEO was somewhat low based on
the performance levels of the peer group.
Stock option shares granted to Mr. Adams were determined to be competitive
when compared by the Committee to the grant practices of a broad spectrum of
banking organizations as presented in a report by Buck Consultants.
Mr. Adams at age 55 has served the company for 33 years; 27 of those years
he has been responsible for motivating and building the organization.
During the past 11 years UBSI stock has outperformed the S&P 500 and the
KBW Bank Index. Over the past 27 years of the current administration dividends
have increased each year for an annual compound growth rate of 10.6%. United's
pay for performance compensation program emphasizing written performance
objectives has been a major contributor to our ability to consistently enhance
long-term shareholder value.
No member of the Committee is a former or current officer or employee of
United.
COMPENSATION COMMITTEE
----------------------
Thomas J. Blair, III Harry L. Buch W. Gaston Caperton, III
H. Smoot Fahlgren Theodore J. Georgelas F. T. Graff, Jr.
Russell L. Isaacs, Chairman John M. McMahon G. Ogden Nutting
William C. Pitt, III Warren A. Thornhill, III
Compensation Committee Interlocks and Insider Participation
F. T. Graff, Jr., a member of the Board of Directors of United, its
Executive Committee and the Board's Compensation Committee, is a partner in the
law firm of Bowles Rice McDavid Graff & Love in Charleston, West Virginia.
Bowles Rice McDavid Graff & Love rendered legal services to United and United
Bank (WV) during 2001 and it is expected that the firm will continue to render
certain services to both in the future. The fees paid to Bowles Rice McDavid
Graff & Love represent less than 5% of that firm's revenues for 2001.
13
PERFORMANCE GRAPH
The following graph compares United's cumulative total shareholder return
on its common stock for the five year period ending December 31, 2001, with the
cumulative total return of the Standard and Poor's Midcap 400 Index and with the
NASDAQ OTC Bank Index. There is no assurance that United's common stock
performance will continue in the future with the same or similar trends as
depicted in the graph. The graph shall not be deemed incorporated by reference
by any general statement incorporating by reference this proxy statement into
any filing under the Securities Act of 1933 or the Securities Exchange Act of
1934 except to the extent United specifically incorporates this graph by
reference, and shall not otherwise be filed under such Acts.
-------------------------
UNITED BANKSHARES, INC.
-------------------------
[GRAPH]
NASDAQ S&P
UBSI BANK MIDCAP
--------------------------------------
1996 100.000 100.000 100.000
1997 149.411 163.587 147.263
1998 170.358 144.331 153.498
1999 158.725 132.811 173.985
2000 147.410 152.298 202.191
2001 207.302 167.645 198.885
United Bankshares, Inc. Plans
Officer Employment Contracts. Richard M. Adams, Chairman and Chief
Executive Officer of United and United National Bank, now United Bank (WV),
entered into an employment contract with United effective April 11, 1986,
effective for a five year term from April 1, 1986, with the provision that the
contract could be extended by one (1) year to maintain a rolling five (5) year
contract. This contract was amended in November 2001. This most recent amendment
superseded all other amendments and extended the initial term of the contract
through March 31, 2007 with the provision for additional one (1) year term
extensions by the Executive Committee with the approval of Mr. Adams. Under the
amended contract Mr. Adams is required to devote his full-time energies to
performing his duties as Chairman and CEO on behalf of United and its
subsidiaries. The contract provides for a base compensation of $536,000 and
additional benefits consistent with the office. This base compensation may be
increased but not decreased. If the contract is terminated for any reason other
than mutual consent or cause based on (i) excessive, unapproved absences, (ii)
gross or willful neglect of duty that results in some substantial loss to
United, or (iii) fraud or commission of any criminal act, if proven, Mr. Adams,
or his family or estate, is entitled to his base salary for a sixty (60) month
period. If the contract is terminated by mutual consent, the amount due Mr.
Adams or his
14
family or estate shall be the amount mutually agreed upon by Mr.
Adams and United. In an instance of termination for cause based on (i), (ii),
(iii) or any combination thereof, United shall pay Mr. Adams' base salary only
for the period of his active full-time employment to the date of termination.
The contract between Mr. Adams and United also provides for an additional
payment by United to Mr. Adams in the form of a gross-up payment in the event
that a payment or distribution pursuant to the contract would be subject to the
excise tax imposed by Section 4999 of the Internal Revenue Code of 1986, as
amended. Any calculated gross-up payment amount shall be equal to one hundred
percent (100%) of the excise tax plus one hundred percent (100%) of any federal,
state and local income taxes plus the additional excise tax on the gross-up
amount. Any gross-up payment pursuant to the contract shall be paid to Mr. Adams
within 30 days of the receipt of the amount determined.
On July 27, 1990, United also entered into a Supplemental Retirement
Agreement with Mr. Adams. The agreement was amended on November 1, 2001. This
amended agreement provides for an annual supplemental retirement benefit upon
his reaching age 65 or upon the later termination of his employment with United
or an affiliated or successor entity to United, whichever last occurs. The
annual benefit will be equal to seventy percent (70%) of the average of Mr.
Adams' three highest base salaries, reduced by benefits actuarially calculated
at the time the supplemental retirement benefit becomes payable under (i) the
United Pension Plan; (ii) social security; and the United Savings and Stock
Investment Plan. The amended agreement also provides for reduced benefits for
early retirement before age 65 as well as payments to his spouse or his estate
if unmarried in the event of his death. The benefits under the amended agreement
are fully vested in Mr. Adams and shall survive his termination of employment
from United or an affiliated or successor entity to United for whatever reason,
including but not limited to, change in control, dismissal with or without
cause, voluntary termination, expiration of contract or disability.
United and United National Bank, now United Bank (WV), entered into an
employment agreement with I. N. Smith, Jr., the now former President of United,
on December 17, 1985. The term of the agreement extends until Mr. Smith reaches
the age of 75. In June of 1997, Mr. Smith retired from United. Until he reaches
the age of 75, Mr. Smith shall render such consulting and advisory services as
United may request, and shall receive for such services an annual fee of $36,000
until he reaches age 70, and $30,000 thereafter. In addition, Mr. Smith has
agreed to serve as a director of United and United has agreed to use its best
efforts to nominate and elect him.
On December 7, 2001, United and United Bank (VA) entered into an agreement
(the "Agreement") with Joseph S. Bracewell, then Chairman of the Board, Chief
Executive Officer, and President of Century Bancshares, Inc. (Century). Upon
consummation of the acquisition of Century by United, the Agreement provided for
the assumption of the obligations and liabilities of Century under an employment
agreement dated September 1, 1996 between Mr. Bracewell and Century (the
"Employment Agreement"), and for the termination of the Employment Agreement
effective as of January 1, 2002. Upon termination of the Employment Agreement,
United paid Mr. Bracewell $250,000 as consideration for certain non-competition
and non-solicitation provisions and $500,000 for a change of control provision
in accordance with the Employment Agreement. At the effective time of United's
acquisition of Century, Mr. Bracewell was appointed to serve as Vice Chairman of
the Board of United Bank (VA) and as a Director of United with duties and
responsibilities commensurate with such positions, including promoting the
products and services of United and United Bank (VA) to the customer base of
Century, maintaining relationships and soliciting business with such former
customers, general customer and employee relations, public relations, assisting
in strategic planning and the full development of the potential of the strategic
combination of United and Century, assisting in the smooth and orderly
transition of management and employees from Century, and such other services and
duties consistent with the foregoing as may be reasonably assigned to him from
time to time by the Boards of Directors of United and United Bank (VA). In
exchange for his services, Mr. Bracewell
15
will receive cash compensation of $75,000 to be paid in periodic monthly
installments beginning January 31, 2002 and ending on December 31, 2002.
Change of Control Agreements. In March of 1994, United entered into
agreements with Steven E. Wilson, James B. Hayhurst, Jr. and Joe L. Wilson to
encourage those executive officers not to terminate their employment with United
because of the possibility that United might be acquired by another entity. In
August of 2000, United entered into similar change of control agreements with
Richard M. Adams, Jr., Kendal E. Carson, James J. Consagra and John Neuner, III.
The Board of Directors determined that such an arrangement was appropriate,
especially in view of the recent entry of large regional bank holding companies
into West Virginia. The agreements were not undertaken in the belief that a
change of control of United was imminent.
Generally, the agreements provide severance compensation to those officers
if their employment should end under certain specified conditions after a change
of control of United. Compensation is paid upon any involuntary termination
following a change of control unless the officer is terminated for cause. In
addition, compensation will be paid after a change of control if the officer
voluntarily terminates employment because of a decrease in the total amount of
the officer's base salary below the level in effect on the date of consummation
of the change of control, without the officer's consent; a material reduction in
the importance of the officer's job responsibilities without the officer's
consent; geographical relocation of the officer without consent to an office
more than fifty (50) miles from the officer's location at the time of a change
of control; failure by United to obtain assumption of the contract by its
successor or any termination of employment within thirty-six (36) months after
consummation of a change of control which is effected for any reason other than
good cause.
Under the agreements, a change of control is deemed to occur in the event
of a change of ownership of United which must be reported to the Securities and
Exchange Commission as a change of control, including but not limited to the
acquisition by any "person" (as such term is used in Sections 13(d) and 14(d) of
the Securities and Exchange Act of 1934 (the "Exchange Act")) of direct or
indirect "beneficial ownership" (as defined by Rule 13d-3 under the Exchange
Act) of twenty-five percent (25%) or more of the combined voting power of
United's then outstanding securities, or the failure during any period of two
(2) consecutive years of individuals who at the beginning of such period
constitute the Board for any reason to constitute at least a majority thereof,
unless the election of each director who was not a director at the beginning of
such period has been approved in advance by directors representing at least
two-thirds (2/3) of the directors at the beginning of the period.
Under the agreements, severance benefits include: (a) cash payment equal to
the officer's monthly base salary in effect on either (i) the date of
termination; (ii) the date immediately preceding the change of control,
whichever is higher, multiplied by the number of full months between the date of
termination and the date that is thirty-six (36) months after the date of
consummation of the change of control; (b) payment of cash incentive award, if
any, under United's Incentive Plan; (c) continuing participation in employee
benefit plans and programs such as retirement, disability and medical insurance
for a period of thirty-six (36) months following the date of termination.
The agreements do not effect the right of United to terminate the officer,
or change the salary or benefits of the officer, with or without good cause,
prior to any change of control; provided, however, any termination or change
which takes place after discussions have commenced which result in a change of
control will be presumed to be a violation of the agreement and will entitle the
officer to the benefits under the agreement, absent clear and convincing
evidence to the contrary.
Employee Benefit Plans. No directors or principal shareholders of United
and its subsidiaries, other than those persons who are salaried officers,
participate in any type of benefit plan of United.
16
United's subsidiaries provide, on a substantially non-contributory basis
for all full-time employees, life, disability, health and dental insurance. Life
insurance with value of 250% of base salary is provided to all full-time
employees, including executive officers. The premiums paid by United for life
insurance on any individual, which has a face value greater than $50,000 is
properly reported as compensation. These plans do not discriminate, in scope,
terms or operation, in favor of the executive officers of United or its
subsidiaries and are available generally to all salaried employees of United and
its subsidiaries.
Each employee of United, or its participating subsidiaries, who completes
one year of eligible service and is 21 years of age is eligible to participate
in the Pension Plan. The plan is noncontributory on the part of the employee.
Vesting is attained with five years of participation.
--------------------------------------------------------------------------------
PENSION PLAN TABLE
--------------------------------------------------------------------------------
Years of Service
Remuneration 15 20 25 30 35
------------ ---- ---- ---- ---- ----
$ 125,000 $ 30,744 $ 40,992 $ 51,241 $ 51,241 $ 51,241
150,000 37,307 49,742 62,178 62,178 62,178
175,000 37,307 49,742 62,178 62,178 62,178
200,000 37,307 49,742 62,178 62,178 62,178
225,000 37,307 49,742 62,178 62,178 62,178
250,000 37,307 49,742 62,178 62,178 62,178
275,000 37,307 49,742 62,178 62,178 62,178
300,000 37,307 49,742 62,178 62,178 62,178
325,000 37,307 49,742 62,178 62,178 62,178
350,000 37,307 49,742 62,178 62,178 62,178
375,000 37,307 49,742 62,178 62,178 62,178
400,000 37,307 49,742 62,178 62,178 62,178
425,000 37,307 49,742 62,178 62,178 62,178
450,000 37,307 49,742 62,178 62,178 62,178
475,000 37,307 49,742 62,178 62,178 62,178
500,000 37,307 49,742 62,178 62,178 62,178
The table above illustrates the operation of United's Pension Plan and
Supplemental Retirement Plan ("SERP") by showing various annual benefits, after
reduction for Social Security retirement income, assuming various annual base
salaries and years of credited service. Benefit figures shown are computed on
the assumption that participants retire at the normal retirement age of 65. For
purposes of the table, it is assumed each participant is receiving benefits from
the Pension Plan in the form of a life annuity. Benefits under the SERP are paid
in the form of a life annuity.
The SERP ensures that each participating executive officer, who retires at
age 65, receives a level of retirement benefits, without regard to years of
service, equal to 70% of the executive officer's average three highest base
salary years during his employment with United or an affiliated or successor
entity. At the time a participating executive officer retires, the benefit the
participant is entitled to through the SERP is calculated, and then funds from
the following sources are deducted to determine the amount, if any, of the
payment due under the SERP:
17
(i) the benefit under the Pension Plan; (ii) Social Security benefits payable;
and (iii) any benefits under United's Savings and Stock Investment Plan.
The estimated credited years of service for each of the executive officers
named in the Summary Compensation Table under the Pension Plan as of December
31, 2001, are as follows: Mr. Adams 33 years; Mr. S. Wilson 30 years; Mr.
Hayhurst 30 years; Mr. Carson 10 years; and Mr. J. Wilson 31 years.
Each employee of United, who completes one year of eligible service, is
eligible to participate in the United Savings and Stock Investment Plan, a
deferred compensation plan under Section 401(k) of the Internal Revenue Code.
Each participant may contribute from 1% to 15% of pretax earnings to his/her
account that may be invested in any of four investment options chosen by the
employee. United matches 100% of the first 2% of salary deferred and 25% of the
second 2% of salary deferred with United stock. Vesting is 100% for employee
deferrals and the company match at the time the employee makes his/her deferral.
United employees may participate in an employee stock purchase plan whereby
its employees may purchase shares of United's common stock. Purchases made by
employees under this plan are coordinated by the Trust Department of UB, and
involve stock purchased at market price for this purpose.
--------------------------------------------------------------------------------
AUDIT COMMITTEE REPORT
--------------------------------------------------------------------------------
The United Bankshares, Inc. Audit Committee reviews United's financial
reporting process on behalf of the Board of Directors. Management has the
primary responsibility for the financial statements and the reporting process
including the systems of internal control. United's independent auditors are
responsible for expressing an opinion on the conformity of the audited financial
statements with generally accepted accounting principles in the United States.
In fulfilling its oversight responsibilities, the Audit Committee reviewed and
discussed with management and the independent auditors the 2001 audited
financial statements. This discussion included the quality, not just the
acceptability, of the accounting principles, the reasonableness of significant
judgements and the clarity of disclosures in the financial statements.
The Audit Committee discussed with the independent auditors the matters
required to be discussed by Statement on Auditing Standards No. 61
(Communications with Audit Committees). In addition, the Audit Committee
received from the independent auditors the written disclosures required by
Independence Standards Board No. 1 (Independence Discussions with Audit
Committees) and discussed with them their independence from the Company and its
management. And, the Audit Committee determined that the nonaudit services
provided to the Company by the independent auditors are compatible with the
auditors' independence.
In reliance on the reviews and discussions referred to above, the Audit
Committee recommended to the Board of Directors, and the Board of Directors
approved, that the audited financial statements be included in United's Annual
Report on Form 10-K for the year ended December 31, 2001, for filing with the
Securities and Exchange Commission.
No member of the Audit Committee is a former or current officer or employee
of United.
AUDIT COMMITTEE
---------------
Robert G. Astorg, Chairman P. Clinton Winter, Jr.
James W. Word, Jr. R. Terry Butcher
18
--------------------------------------------------------------------------------
EXECUTIVE OFFICERS
--------------------------------------------------------------------------------
Set forth below are the executive officers of United and relations that
exist with affiliates and others for the past five years.
---------------------------------------------------------------------------------------------------------
Principal Occupation and
Name Age Present Position Banking Experience During
the Last Five Years
---------------------------------------------------------------------------------------------------------
Richard M. Adams 55 Chairman of the Board & Chief Chairman of the Board & Chief
Executive Officer - United; Executive Officer - United;
Chairman of the Board & Chief Chairman of the Board & Chief
Executive Officer - United Bank Executive Officer - United Bank
(WV) (WV)
---------------------------------------------------------------------------------------------------------
Richard M. Adams, Jr. 33 Executive Vice-President - United; Senior Vice-President - United
Executive Vice-President - United Bank (WV)President - United Bank
(WV) Brokerage Co.
---------------------------------------------------------------------------------------------------------
Kendal E. Carson 46 Executive Vice-President - United; Executive Vice-President - United
President & Chief Executive Bank (VA); Executive Vice-
Officer - United Bank (VA) President - George Mason Bank
---------------------------------------------------------------------------------------------------------
James J. Consagra, Jr. 41 Executive Vice-President -United; Executive Vice-President -United;
Executive Vice-President & Chief Executive Vice-President & Chief
Financial Officer-United Bank (VA) Financial Officer-United Bank
(VA); Treasurer - George Mason
Bankshares, Inc.; Executive
Vice-President - George Mason Bank
---------------------------------------------------------------------------------------------------------
James B. Hayhurst, Jr. 55 Executive Vice-President -United; Executive Vice-President -United;
Executive Vice-President - United Executive Vice-President - United
Bank (WV) Bank (WV)
---------------------------------------------------------------------------------------------------------
John Neuner, III 56 Executive Vice-President - United; Executive Vice-President -United;
Executive Vice-President - United Executive Vice-President - United
Bank (WV) Bank (WV)
---------------------------------------------------------------------------------------------------------
Joe L. Wilson 54 Executive Vice-President -United; Executive Vice-President -United;
Executive Vice-President - United Executive Vice-President - United
Bank (WV) Bank (WV)
---------------------------------------------------------------------------------------------------------
Steven E. Wilson 53 Executive Vice-President, Chief Executive Vice-President, Chief
Financial Officer, Treasurer & Financial Officer, Treasurer &
Secretary -United; Executive Secretary -United; Executive
Vice-President, Chief Financial Vice-President, Chief Financial
Officer, Treasurer & Secretary - Officer, Treasurer & Secretary -
United Bank (WV) United Bank (WV)
---------------------------------------------------------------------------------------------------------
Richard M. Adams and Richard M Adams, Jr. are father and son.
19
--------------------------------------------------------------------------------
REQUIREMENTS, INCLUDING DEADLINES, FOR SUBMISSION OF PROXY PROPOSALS,
NOMINATIONS OF DIRECTORS, AND OTHER BUSINESS OF SHAREHOLDERS
--------------------------------------------------------------------------------
Nomination of Directors
Nominations may be made only if such nominations are made in accordance
with the procedures set forth in Article II, Section 5 of the Restated Bylaws of
United, which section, in full, is set forth below:
Section 5. Nomination of directors. Directors shall be nominated by the
Board prior to the giving of notice of any meeting of shareholders wherein
directors are to be elected. Additional nominations of directors may be made by
any shareholder; provided that such nomination or nominations must be made in
writing, signed by the shareholder and received by the Chairman or President no
later than ten (10) days from the date the notice of the meeting of shareholders
was mailed; however, in the event that notice is mailed less than thirteen (13)
days prior to the meeting, such nomination or nominations must be received no
later than three (3) days prior to any meeting of the shareholders wherein
directors are to be elected.
Stock Transfers
United Bankshares, Inc. common stock is listed on NASDAQ, National
Association of Securities Dealers Quotation System,National Market System. The
quotation symbol is "UBSI".
Independent Auditors
Ernst & Young LLP, Charleston, West Virginia, has served as the independent
auditors for United and its subsidiaries since 1986 and has been selected by the
Board of Directors to continue as the independent auditors for United and its
subsidiaries for the next fiscal year. Representatives of Ernst & Young LLP will
be present at the Annual Meeting and will have an opportunity to make a
statement if they desire to do so. Such representatives of the firm will be
available to respond to appropriate shareholder inquiries at the Annual Meeting.
Audit Fees
Fees for the most recent annual audit of United's consolidated financial
statements were $218,000.
All Other Fees
All other fees paid to United's independent auditor, Ernst & Young LLP,
during 2001 included fees for the following services: regulatory, statutory, and
compliance audits - $114,400; merger and acquisition registration statement and
consultation - $33,300; accounting consultation - $11,900; employee benefit
related consultation - $215,300; and tax compliance and consultation - $137,150.
The total of all other fees for the aforementioned services was $512,050.
Shareholder Proposals for 2003 Annual Meeting
Presently, the next annual meeting of United shareholders is scheduled for
May 19, 2003. Any shareholder proposals to be presented at that 2003 Annual
Meeting must be received at the principal office of United no later than
December 14, 2002. If the scheduled date for the 2003 Annual Meeting is changed
by more than thirty (30) days, shareholders will be informed of the new meeting
date and the revised date by which shareholder proposals must be received.
20
--------------------------------------------------------------------------------
FORM 10-K
--------------------------------------------------------------------------------
The Company will furnish without charge to each person whose proxy is being
solicited, upon the request of any such person, a copy of the Company's annual
report on Form 10-K for 2001. Requests for copies of such report should be
directed to Shareholder Relations, United Bankshares, Inc., P. O. Box 1508,
Parkersburg, West Virginia 26102.
--------------------------------------------------------------------------------
Whether or not you plan to attend the Meeting, please mark, sign, date and
promptly return the enclosed proxy in the enclosed envelope. No postage is
required for mailing in the United States.
By Order of the Board of Directors
Richard M. Adams
/s/ Richard M. Adams
Chairman of the Board and
Chief Executive Officer
April 8, 2002
21
UNITED BANKSHARES, INC.
PROXY FOR 2002 ANNUAL SHAREHOLDERS' MEETING
Know all men by these presents that the undersigned shareholder(s) of United
Bankshares, Inc., Charleston, West Virginia does hereby nominate, constitute and
appoint James J. Consagra, Jr. and Steven E. Wilson or either one of them, with
full power to act alone as the true and lawful attorneys for the undersigned
with full power of substitution for and in the name, place and stead of the
undersigned to vote all the common stock of United Bankshares, Inc., standing in
the undersigned's name on its books on April 1, 2002, at the 2002 Annual Meeting
of Shareholders to be held at The University of Charleston, 2300 MacCorkle
Avenue, S.E., Charleston, West Virginia, on May 20, 2002 at 4:00 p.m., local
time or any adjournments thereof, with all the powers the undersigned would
possess if personally present as follows:
The undersigned acknowledges receipt of the Notice and Proxy Statement dated
April 8, 2002, and hereby revokes all proxies previously given by the
undersigned for said meeting.
This proxy confers authority to vote "FOR" the propositions listed below unless
otherwise indicated. The Board of Directors recommends a vote "FOR" the
proposals below. If any matter shall properly come before the meeting, or any
adjournments thereof, this proxy will be voted on such matters in accordance
with the judgment of the above proxies, based upon the conditions then
prevailing and any recommendation of the Board of Directors.
Unless a different allocation is indicated, the proxies will vote your total
cumulative vote ratably for the directors for whom you are voting unless
directed otherwise by the Board of Directors of United Bankshares, Inc.
This proxy is solicited on behalf of the Board of Directors of United
Bankshares, Inc. and may be revoked prior to its exercise.
Continued, and to be marked, dated and signed, on the other side. All joint
owners must sign.
When signing as attorney, executor, administrator, trustee or guardian, please
give full title. If more than one trustee, all should sign.
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. FOLD AND DETACH HERE .
--UBSI-
Annual Meeting
of United Bankshares, Inc.
Monday, May 20, 2002 at 4:00 p.m.
University of Charleston
2300 MacCorkle Avenue, S.E.
Charleston, West Virginia
The Board of Directors recommends a vote FOR the following eighteen nominees: Please mark
your vote as [X]
indicated in
this example
1. Election of Directors.
01. Richard M. Adams 07. H. Smoot Fahlgren 13. G. Ogden Nutting
02. Robert G. Astorg 08. Theodore J. Georgelas 14. William C. Pitt, III
FOR all nominees WITHHOLD 03. Thomas J. Blair, III 09. F. T. Graff, Jr. 15. I. N. Smith, Jr.
listed (except as AUTHORITY 04. Joseph S. Bracewell 10. Alan E. Groover 16. Warren A. Thornhill, III
marked to the to vote for all 05. Harry L. Buch 11. Russell L. Isaacs 17. P. Clinton Winter, Jr.
contrary below) nominees listed 06. W. Gaston Caperton, III 12. John M. McMahon 18. James W. Word, Jr.
[_] [_]
By checking the box to the right, I
consent to future delivery of annual
reports, proxy statements, prospectuses
and other materials and shareholder
communications electronically via the
Internet at a webpage which will be
disclosed to me. I understand that the
Company may no longer distribute printed [_]
materials to me from any future
shareholder meeting until such consent is
revoked. I understand that I may revoke my
consent at any time by contacting the
Company's transfer agent, Mellon Investor
Services LLC, Ridgefield Park, NJ and that
costs normally associated with electronic
delivery, such as usage and telephone
charges as well as any costs I may incur
in printing documents, will be my
responsibility.
2. To transact other business that may If you wish to withhold your vote for any of the above nominees, so indicate by
properly come before the meeting. striking the name of the nominee.
FOR AGAINST ABSTAIN
[_] [_] [_]
THIS PROXY WHEN PROPERLY EXECUTED WILL BE
VOTED IN THE MANNER DIRECTED HEREIN BY THE
UNDERSIGNED SHAREHOLDER. IF NO DIRECTION
IS MADE, THIS PROXY WILL BE VOTED FOR
PROPOSALS 1 AND 2.
Dated:_____________________________, 2002
__________________________________________
__________________________________________
(Signature or Signatures)
"PLEASE MARK INSIDE BOXES SO THAT DATA PROCESSING EQUIPMENT WILL RECORD YOUR VOTES" PLEASE SIGN, DATE AND PROMPTLY RETURN THIS
PROXY IN THE ENCLOSED ENVELOPE
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-FOLD AND DETACH HERE-
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Your Vote is IMPORTANT
Please complete, date and sign the above
proxy card and return it promptly
in the accompanying envelope.
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[LOGO] UNITED BANKSHARES, INC.
THE CHALLENGE TO BE THE BEST NEVER ENDS