Proposal 1:
Election of Directors

Nominees

United Security Bancshares’ Bylaws provide that the number of directors of United Security Bancshares shall not be less than eight (8) nor more than fifteen (15) until changed by an amendment of the articles of incorporation or the bylaws adopted by the vote or written consent of holders of a majority of the outstanding shares entitled to vote, provided that a proposal to reduce the authorized number or the minimum number of directors below five cannot be adopted.  The exact number of directors shall be fixed from time to time, within the range: (i) by a resolution duly adopted by the board of directors; (ii) by the vote of a majority of the shares entitled to vote represented at a duly held meeting at which a quorum is present, or by the written consent of the holders of a majority of the outstanding shares entitled to vote; or (iii) by approval of the shareholders.  The exact number of directors has been set at nine (9).

The persons named below, all of whom are currently members of the board of directors, have been nominated for election as directors to serve until the 2006 annual meeting of shareholders and until their successors are elected and have qualified.  Votes of the proxyholders will be cast in such a manner as to effect the election of all nine (9) nominees, as appropriate, (or as many thereof as possible under the rules of cumulative voting).  The nine (9) nominees for directors receiving the most votes will be elected directors.  In the event that any of the nominees should be unable to serve as a director, it is intended that the proxy will be voted for the election of such substitute nominee, if any, as shall be designated by the board of directors.  The board of directors has no reason to believe that any of the nominees named below will be unable to serve if elected.

The following table sets forth, as of March 18, 2005, the names of, and certain information concerning, the persons nominated by the board of directors for election as directors of United Security Bancshares.

12

All of the nominees named above have served as members of United Security Bancshares’ board of directors since its inception, other than R. Todd Henry and Robert Mochizuki.  All nominees will continue to serve if elected at the meeting until the 2006 annual meeting of shareholders and until their successors are elected and have been qualified.

None of the directors were selected pursuant to any arrangement or understanding other than with the directors and executive officers(1) of United Security Bancshares acting within their capacities as such.  There are no family relationships between any of the directors of United Security Bancshares.  No director of United Security Bancshares serves as a director of any company which has a class of securities registered under, or which is subject to the periodic reporting requirements of, the Securities Exchange Act of 1934, or of any company registered as an investment company under the Investment Company Act of 1940.

Compensation of Directors and Executive Officers

Director Compensation

During 2004, directors of United Security Bancshares and United Security Bank were compensated for monthly board meetings based on a performance rating structure ranging from a minimum of $800 per meeting up to $1,300 per meeting.  In addition, the vice chairman received an additional $200 per meeting and the secretary received an additional $250 per meeting.  Also, directors, other than Mr. Woods, were paid $200 for their attendance at committee meetings, other than loan committee meetings, and were paid $300 for their attendance at loan committee meetings, if such

(1)                                   As used in this proxy statement, the term “executive officer” of United Security Bancshares includes the President/Chief Executive Officer, Senior Vice President/Chief Financial Officer, Senior Vice President/Chief Credit Officer, Senior Vice President/Chief Operating Officer and Senior Vice President/Chief Banking Officer.

13

committee meeting was held on a day other than the regular board of directors’ meeting.  The chairman of the audit committee also received $400 per audit meeting and the chairman of the risk management committee received $300 per risk management meeting.

In September, 2000, Mr. Cavalla, a director of United Security Bancshares, received a stock option under the United Security Bank 1995 Stock Option Plan to acquire 5,000 shares of common stock.  The exercise price for these shares is $17.00 per share.  This option is for a term of ten years expiring in September, 2010.

Director Emeritus Plan

During 1995, United Security Bank also established a Directors Emeritus Plan, which was amended in May, 2000.  Those directors who (i) retire as directors of United Security Bank or (ii) retired as directors of Golden Oak Bank and who signed a shareholder’s agreement, are eligible to participate in the Directors Emeritus Plan.  Each Director Emeritus will be a lifetime position or until a Director Emeritus shall sell a majority of his or her ownership in United Security Bank.  Directors Emeritus receive a monthly fee of $400, and receive preferential deposit and customer service with free checking as long as they serve as a Director Emeritus.  Director Emeritus benefits terminate upon (i) the ultimate sale of United Security Bank, (ii) the sale of a majority of the Director Emeritus’ shares of United Security Bank’s common stock, or (iii) the finding by United Security Bank’s board of directors that the Director Emeritus is engaging in activities or making statements which are detrimental to United Security Bank or United Security Bank’s public image.

14

Executive Compensation

The persons serving as the executive officers of United Security Bancshares received during 2004, and are expected to continue to receive in 2005, cash compensation in their capacities as executive officers of United Security Bank.  The following Summary Compensation Table indicates the compensation of United Security Bancshares’ executive officers.

15

(1)                                   Includes $15,300 in directors fees.

(2)                                   This amount represents United Security Bank’s contribution under United Security Bank’s Cash or Deferred 401(k) Plan, United Security Bank’s Employee Stock Ownership Plan and the cost of premiums for excess disability, medical and life insurance.

(3)                                   Mr. Franson was first employed by United Security Bank in September 2003.  Mr Franson resigned on March 15, 2005.

16

17

Mr. Woods has a salary continuation agreement with United Security Bank which provides that United Security Bank will pay him $100,000 per year for 15 years following his retirement from United Security Bank at age 61 (“Retirement Age”).  In the event of disability while Mr. Woods is actively employed prior to Retirement Age, he will have the option to take a benefit amount based on the vesting schedule below for 15 years beginning at the earlier of the time when he reaches age 61 or the date on which he is no longer entitled to disability benefits under his principal disability insurance policy.  In the event Mr. Woods dies while actively employed by United Security Bank prior to Retirement Age, his beneficiary will receive from United Security Bank $100,000 per year for 15 years beginning one month after his death.  In the event of termination without cause, early retirement, or voluntary termination, Mr. Woods shall receive a benefit amount based on the vesting schedule below for 15 years beginning with the month following the month in which Mr. Woods terminates employment and attains age 61.  The vesting schedule is 25% for the first year of service beginning July 3, 1996, 15% for the second year of service, 10% for the third year of service, 6% per year of service for the following eight years of service and 2% for the twelfth year of service.  In the event Mr. Woods is terminated for cause he will forfeit any benefits from the salary continuation agreement.

In addition, Mr. Woods also has an agreement with United Security Bank for severance compensation in the event there is a change in control of United Security Bank.  The agreement is for a term of five years beginning February 26, 2002.  Pursuant to the agreement, in the event there is an acquisition (as defined in the agreement) of United Security Bank, then the resulting corporation shall pay Mr. Woods a lump sum amount in cash equal to the sum of (i) the last three (3) years of his total compensation, inclusive of his base annual salary and bonus and (ii) the amount necessary to cover any “golden parachute taxes” that may be assessed pursuant to Section 280G of the Internal Revenue Code.

Mr. Donahue has a salary continuation agreement with United Security Bank which provides that United Security Bank will pay him $50,000 per year for 15 years following his retirement from United Security Bank at age 59 (“Retirement Age”).  In the event of disability while Mr. Donahue is actively employed prior to Retirement Age, he will have the option to take a benefit amount based on the vesting schedule below for 15 years beginning at the earlier of the time when he reaches age 59 or the date on which he is no longer entitled to disability benefits under his principal disability insurance policy.  In the event Mr. Donahue dies while actively employed by United Security Bank prior to Retirement Age, his beneficiary will receive from United Security Bank $50,000 per year for 15 years beginning one month after his death.  In the event of termination without cause, early retirement, or voluntary termination, Mr. Donahue shall receive a benefit amount based on the vesting schedule below for 15 years beginning with the month following the month in which Mr. Donahue terminates employment and attains age 59.  The vesting schedule is 8.33% for each year of service beginning January 1, 1997.  In the event Mr. Donahue is terminated for cause he will forfeit any benefits from the salary continuation agreement.

In addition, Mr. Donahue also has an agreement with United Security Bank for severance compensation in the event there is a change in control of United Security Bank.  The agreement is for a term of five years beginning February 26, 2002.  Pursuant to the agreement, in the event there is an acquisition (as defined in the agreement) of United Security Bank, then the resulting corporation shall pay Mr. Donahue a lump sum amount in cash equal to his last year’s total compensation, inclusive of his base annual salary and bonus reduced by such amount, if any so that all benefits that are accelerated as a result of the acquisition will not be subject to any “golden parachute taxes” that may be assessed pursuant to Section 280G of the Internal Revenue Code.

18

Mr. Eytcheson has a salary continuation agreement with United Security Bank which provides that United Security Bank will pay him $50,000 per year for 15 years following his retirement from United Security Bank at age 68 (“Retirement Age”).  In the event of disability while Mr. Eytcheson is actively employed prior to Retirement Age, he will have the option to take a benefit amount based on the vesting schedule below for 15 years beginning at the earlier of the time when he reaches age 68 or the date on which he is no longer entitled to disability benefits under his principal disability insurance policy.  In the event Mr. Eytcheson dies while actively employed by United Security Bank prior to Retirement Age, his beneficiary will receive from United Security Bank $50,000 per year for 15 years beginning one month after his death.  In the event of termination without cause, early retirement, or voluntary termination, Mr. Eytcheson shall receive a benefit amount based on the vesting schedule below for 15 years beginning with the month following the month in which Mr. Eytcheson terminates employment and attains age 68.  The vesting schedule is 8.33% for each year of service beginning January 1, 1997.  In the event Mr. Eytcheson is terminated for cause he will forfeit any benefits from the salary continuation agreement.

In addition, Mr. Eytcheson also has an agreement with United Security Bank for severance compensation in the event there is a change in control of United Security Bank.  The agreement is for a term of five years beginning February 26, 2002.  Pursuant to the agreement, in the event there is an acquisition (as defined in the agreement) of United Security Bank, then the resulting corporation shall pay Mr. Eytcheson a lump sum amount in cash equal to his last year’s total compensation, inclusive of his base annual salary and bonus reduced by such amount, if any so that all benefits that are accelerated as a result of the acquisition will not be subject to any “golden parachute taxes” that may be assessed pursuant to Section 280G of the Internal Revenue Code.

Mr. Braa has a salary continuation agreement with United Security Bank which provides that United Security Bank will pay him $50,000 per year for 15 years following his retirement from United Security Bank at age 66 (“Retirement Age”).  In the event of disability while Mr. Braa is actively employed prior to Retirement Age, he will have the option to take a benefit amount based on the vesting schedule below for 15 years beginning at the earlier of the time when he reaches age 66 or the date on which he is no longer entitled to disability benefits under his principal disability insurance policy.  In the event Mr. Braa dies while actively employed by United Security Bank prior to Retirement Age, his beneficiary will receive from United Security Bank $50,000 per year for 15 years beginning one month after his death.  In the event of termination without cause, early retirement, or voluntary termination, Mr. Braa shall receive a benefit amount based on the vesting schedule below for 15 years beginning with the month following the month in which Mr. Braa terminates employment and attains age 66.  The vesting schedule is 8.33% for each year of service beginning January 1, 1997.  In the event Mr. Braa is terminated for cause he will forfeit any benefits from the salary continuation agreement.

In addition, Mr. Braa also has an agreement with United Security Bank for severance compensation in the event there is a change in control of United Security Bank.  The agreement is for a term of five years beginning February 26, 2002.  Pursuant to the agreement, in the event there is an acquisition (as defined in the agreement) of United Security Bank, then the resulting corporation shall pay Mr. Braa a lump sum amount in cash equal to his last year’s total compensation, inclusive of his base annual salary and bonus reduced by such amount, if any so that all benefits that are accelerated as a result of the acquisition will not be subject to any “golden parachute taxes” that may be assessed pursuant to Section 280G of the Internal Revenue Code.

19

Mr. Franson had a salary continuation agreement with United Security Bank which provided that United Security Bank would pay him $50,000 per year for 15 years following his retirement from United Security Bank, subject to vesting and employment requirements.  Mr. Franson resigned in March, 2005, at which time he was only vested as to 8.33% of the benefit.  In lieu of yearly payments, Mr. Franson received a lump sum payout of $13,488 shortly after he resigned.

Proposal 2:
Amendment of the United Security Bank N.A. 1995 Stock Option Plan
to Designate the Maximum Aggregate Number of Shares
that May Be Issued under the 1995 Plan for Incentive Stock Options

In August 2004, the Internal Revenue Service issued final regulations regarding stock options.  Section 1.422-2 of such final regulations requires that a stock option plan providing for the issuance of incentive stock options “must designate the maximum aggregate number of shares that may be issued under such plan as incentive stock options.”  United Security Bancshares has one stock option plan under which stock options are outstanding, the United Security Bank N.A. 1995 Stock Option Plan (“1995 Plan”).  The 1995 Plan provides a single maximum aggregate number of shares of common stock of United Security Bancshares that may be issued for both incentive stock options and nonqualified stock options.  Therefore the 1995 Plan requires amendment and shareholder approval to comply with final regulations of the Internal Revenue Service regarding stock options.  The proposed amendments to the 1995 Plan are technical amendments only.  The 1995 Plan has been terminated and no further options may be granted under the 1995 Plan.

For the previously issued incentive stock options to continue to have favorable federal income tax treatment as incentive stock options, the 1995 Plan must be amended with the approval of shareholders to comply with Section 1.422-2 of the final regulations of the Internal Revenue Service to designate the maximum aggregate number of shares that may be issued as incentive stock options under the plan.  If shareholders do not approve the amendment to the 1995 Plan, optionees, with certain exceptions, may lose the favorable federal income tax treatment for incentive stock options.

The Board of Directors of United Security Bancshares has adopted resolutions amending the 1995 Plan to designate the maximum aggregate number of shares that may be issued as incentive stock options under the 1995 Plan and believes it is in the best interest of United Security Bancshares and it shareholders to approve an amendment to the 1995 Plan to designate the maximum aggregate number of shares that may be issued as incentive stock options under the 1995 Plan.

The 1995 Plan was originally allocated 115,000 shares of common stock of United Security Bancshares, which amount is adjusted for stock splits and stock dividends and other changes in capitalization of United Security Bancshares occurring after the original effective date of the 1995 Plan, and the amendment would expressly designate 115,000 shares of common stock of United Security Bancshares, which amount is adjusted for stock splits and stock dividends and other changes in capitalization of United Security Bancshares occurring after the original effective date of the 1995 Plan as the maximum aggregate number of shares that may be issued as incentive stock options under the 1995 Plan.  The shareholder resolution presented to shareholders to amend the 1995 Plan reads as follows:

20

RESOLVED, that Section 5 of the Plan, as amended is amended in the entirety to read as follows (the new added language appears in bold):

5.                                       Stock Subject to the Plan

Subject to adjustments as provided in Section 12, hereof, the stock to be offered under the Plan shall be shares of the Bank’s authorized but unissued common stock (hereinafter called “stock”) and the aggregate amount of stock to be delivered upon exercise of all options granted under the Plan shall not exceed 115,000 shares.  If any option shall be cancelled, surrendered or expire for any reason without having been exercised in full, the underlying shares subject thereto shall again be available for purposes of the Plan.   Furthermore, the maximum aggregate number of shares that may be issued as incentive stock options under the Plan is 115,000 shares, subject to adjustments as provided in Section 12 hereof .

Approval of the amendment of the 1995 Plan to designate the maximum aggregate number of shares that may be issued as incentive stock options under the 1995Plan requires the affirmative vote of a majority of the outstanding shares of common stock represented and voting at the meeting.

Management recommends that the shareholders vote “FOR” the amendment of the United Security Bank, N.A. 1995 Stock Option Plan to designate the maximum aggregate number of shares that may be issued as incentive stock options under the 1995 Plan.

Options granted pursuant to the 2005 Plan are intended to qualify for treatment either as “incentive stock options” within the meaning of Section 422 of the Code, or as “nonqualified stock options,” as shall be determined and designated upon the grant of each option.  Though there have been no grants of stock options and no determination of intended grants to specific optionees under the 2005 Plan by the Board, it is expected that stock options will be granted under the 2005 Plan to directors, officers and key employees of United Security Bancshares and its subsidiaries after shareholder approval of the 2005 Plan.  The summary below is subject to the provisions of the 2005 Plan, a copy of which is attached to this proxy statement as Exhibit B.

Summary of the 2005 Plan

The 2005 Plan will be administered by the Board, except if any stock options made pursuant to the 2005 Plan will be subject to Section 162(m) of the Internal Revenue Code of 1986 (the “Code”), as amended, then the 2005 Plan shall be administered by a committee comprised solely of qualified outside directors of United Security Bancshares.  All options under the 2005 Plan will be granted at an exercise price of not less than 100 percent of the fair market value of the shares of common stock on the date of grant, except for an incentive stock option granted to an optionee who at the time of the grant owns more than 10% of the total combined voting power of all classes of stock of United Security Bancshares or a subsidiary of United Security Bancshares, in which case the option price shall not be less than 110% of the fair market value of such stock.  The purchase price of any shares purchased upon exercise is payable in full in cash or, subject to applicable law, with common stock previously acquired by the optionee and held by the optionee for a period of at least six months.  The equivalent dollar value of shares used to effect a purchase shall be the fair market value of the common stock on the date of exercise.

Options granted pursuant to the 2005 Plan shall be for a term of up to ten (10) years, except for certain incentive stock options described below.  Each option shall be exercisable in installments and upon such conditions as the Board shall determine.  Options granted shall vest over a period no greater than five years, and no less than 20% of such option shall vest annually.  Optionees shall have the right to exercise all or a portion of the option at any time or from time to time with respect to the vested part of their stock options.  If any option shall expire without being exercised in full, the shares will again become available for granting of stock options under the 2005 Plan.  The 2005 Plan shall expire on April 6, 2015.

Incentive stock options may be granted to full-time salaried officers and management level employees of United Security Bancshares or a subsidiary.  No director who is not also a full-time salaried officer or management level employee may be granted an incentive stock option pursuant to the 2005 Plan.  No incentive stock option with a term of more than five (5) years may be granted to any person who at the time of grant owns stock possessing more than 10% of the total combined voting power or value of all classes of stock of United Security Bancshares or a subsidiary of United Security Bancshares.  Nonqualified stock options may be granted to directors, full-time salaried officers and management level employees of United Security Bancshares or its subsidiaries.

22

Tax Consequences to the Optionee

The following describes, generally, the major federal income tax consequences relating to stock options issued under the 2005 Plan.  If all of the requirements of the 2005 Plan are met, generally no taxable income will result to an optionee upon the grant of an incentive or nonqualified stock option.

Incentive Stock Options .   If the optionee is employed by United Security Bancshares (or a subsidiary) continuously from the date of grant until at least three months before the option is exercised and otherwise satisfies the requirements of the 2005 Plan and applicable law, the optionee will not recognize taxable income upon exercise of the option.  If the optionee is not employed by United Security Bancshares (or a subsidiary) continuously from the date of grant until at least three months before the option is exercised for a reason other than death or disability, the optionee will recognize ordinary income at the time the option is exercised.  United Security Bancshares will be allowed a deduction for federal income tax purposes only if, and to the extent that, the optionee recognizes ordinary income.  Upon exercise of an incentive stock option, the excess of the fair market value of the shares received over the option price at the time of exercise is treated as an item of tax preference which may result in the imposition of the alternative minimum tax.

On a subsequent sale of shares acquired by the exercise of an incentive stock option, gain or loss will be recognized in an amount equal to the difference between the amount realized on the sale and the optionee’s tax basis of the shares sold.  If a disposition (generally a sale, exchange, gift or similar lifetime transfer of legal title) of stock received pursuant to an incentive stock option does not take place until more than two years after the grant of such option and more than one year after the exercise of such option, any gain or loss realized on such disposition will be treated as long-term capital gain or loss.  Under such circumstances, United Security Bancshares will not be entitled to a deduction for income tax purposes in connection with the exercise of the option.

If a disposition of stock received pursuant to an exercise of an incentive stock option occurs within two years after the grant of such option or one year after the exercise of such option, the optionee must treat any gain realized as ordinary income to the extent of the lesser of (i) the fair market value of such stock as of the date of exercise less the option price, or (ii) the amount realized on disposition of the stock less the option price.  Such ordinary income realized is deductible by United Security Bancshares for federal income tax purposes.  Any additional amount realized on the disposition will be taxable as either long-term or short-term capital gain, depending on the holding period.

Nonqualified Stock Options .   In general, when an optionee exercises a nonqualified stock option, the optionee recognizes ordinary income in the amount of the excess of the fair market value of the shares received upon exercise over the aggregate amount paid for those shares, and United Security Bancshares may deduct as an expense the amount of income so recognized by the optionee.  For capital gains purposes, the holding period of the shares begins upon the exercise of the option, and the optionee’s basis in the shares is equal to the fair market value of the shares on the date of exercise.

If, upon exercise of a nonqualified option, the optionee pays all or part of the purchase price by delivering to United Security Bancshares shares of already-owned stock, there are no federal income tax consequences to the optionee or United Security Bancshares to the extent of the number of shares so delivered.  As to any additional shares issued, the optionee recognizes ordinary income equal to the

23

aggregate fair market value of the additional shares received, less any cash paid to United Security Bancshares, and United Security Bancshares is allowed to deduct as an expense the amount of such income.  For purposes of calculating tax upon disposition of the shares acquired, the holding period and basis of the new shares, to the extent of the number of old shares delivered, is the same as for those old shares.  The holding period for the additional shares begins on the date the option is exercised, and the basis in those additional shares is equal to the taxable income recognized by the optionee, plus the amount of any cash paid to United Security Bancshares.

Upon a subsequent disposition of the shares received on exercise, the difference between the amount realized on such disposition and the fair market value of the shares on the date of exercise generally will be treated as a separate capital gain or loss.

Excise Tax .  In addition, the exercise of outstanding options that become exercisable upon certain major corporate events may result in all or a portion of the difference between the fair market value of the option shares and the exercise price of any shares issuable in respect to such options being characterized “parachute payments.”  A 20% excise tax is imposed on the optionee on any amount so characterized and United Security Bancshares will be denied any tax deduction for such amount.

Withholding Taxes .   United Security Bancshares is generally required to withhold applicable payroll taxes with respect to compensation income recognized by optionees.  United Security Bancshares is also generally required to make certain information reports to the Internal Revenue Service with respect to any income of an optionee attributable to transactions involving the grant or exercise of options and/or the disposition of shares acquired on exercise of options.

Other Terms and Conditions

Options under the 2005 Plan shall not be transferable by the optionee during the optionee’s lifetime.  In the event of termination of employment or cessation as a director as a result of the optionee’s death or disability, to the extent exercisable on the date employment or directorship terminates, the option shall remain exercisable for up to one (1) year (but not beyond the end of the original option term) by the disabled optionee or, in the event of death of the optionee, by the person or persons to whom rights under the option shall have passed by will or the laws of descent and distribution.  In addition, if an optionee dies during the three month period referred to below, the option shall expire one year after the date of such death.

If an optionee’s employment is terminated, unless termination was for cause or if an optionee’s directorship is terminated, the optionee shall have the right, for a three-month period after such termination, to exercise that portion of the option which was exercisable immediately prior to such termination.  If an optionee’s employment is terminated for cause (which shall include malfeasance or gross misfeasance in the performance of duties or conviction of a crime involving moral turpitude), the option shall expire within 30 days of the date of termination.  If an optionee is changing his or her status from employee or employee-director to director, an incentive stock option granted to such optionee shall convert to a nonqualified stock option three months and one day following the such optionee’s change in status.  However, in no event may any option be exercised after the end of its original option term.

24

In the event of certain changes in the outstanding common stock, such as stock dividends, stock splits, recapitalization, reclassification, reorganization, merger, stock consolidation or otherwise, appropriate and proportionate adjustments shall be made in the number, kind and exercise price of shares covered by any unexercised options or portions thereof.  In the event of liquidation of United Security Bancshares or upon a reorganization, merger or consolidation of United Security Bancshares with one or more corporations, the result of which United Security Bancshares is not the surviving corporation or United Security Bancshares becomes a subsidiary of another corporation, a sale of substantially all of the assets of United Security Bancshares to another corporation, or upon a sale representing more than 80% of equity securities voting power of United Security Bancshares to any person or entity (any one of which shall be referred to as a “Terminating Event”), the 2005 Plan shall terminate and all options theretofore granted shall completely vest and become immediately exercisable.  All outstanding options not exercised by the time of the Terminating Event shall at such time terminate.  However, any options not exercised at the time of a Terminating Event shall not terminate if they have been assumed or substituted by the successor corporation.

The Board reserves the right to suspend, amend or terminate the 2005 Plan, and, with the consent of the optionee, make such modifications of the terms and conditions of his/her option as it deems advisable, except that the Board may not, without further approval of a majority of the shareholders, increase the maximum number of shares covered by the 2005 Plan, change the minimum option price, increase the maximum term of options under the 2005 Plan or permit options to be granted to anyone other than a director, officer or management level employee.  No option granted pursuant to the 2005 Plan shall be exercisable until all necessary regulatory and shareholder approvals are obtained.

Adoption of the 2005 Plan requires the affirmative vote of a majority of the outstanding shares of common stock represented and voting at the Meeting.  Management recommends that the shareholders vote “FOR” adoption of the United Security Bancshares 2005 Stock Option Plan.

Independent Accountants

The firm of Moss Adams LLP served as certified independent public accountants for United Security Bancshares with respect to the year 2004, and Moss Adams LLP has been appointed as United Security Bancshares’ certified independent public accountants for 2005.  United Security Bancshares’ board has determined the firm of Moss Adams LLP to be fully independent of the operations of United Security Bancshares.

Aggregate fees billed by Moss Adams LLP to United Security Bancshares for the year ended 2004 are as follows:

The Audit Committee of United Security Bancshares has considered the provision of nonaudit services provided by Moss Adams LLP to be compatible with maintaining the independence of Moss Adams LLP.

25

Moss Adams LLP audited United Security Bancshares’ financial statements for the year ended December 31, 2004.  It is anticipated that a representative of Moss Adams LLP will be present at the meeting and will be available to respond to appropriate questions from shareholders at the meeting.

A-2

A-3

A-4

A-5

*    *    *    *

A-6

Exhibit B

United Security Bancshares

2005 Stock Option Plan

1.                                       Purpose

The purpose of the United Security Bancshares 2005 Stock Option Plan (the “Plan”) is to strengthen United Security Bancshares (the “Company”) and those corporations which are or hereafter become subsidiary corporations of the Company by providing an additional means of attracting and retaining competent directors, officers and key employees and by providing to participating directors, officers and key employees added incentive for high levels of performance.  The Plan seeks to accomplish these purposes and achieve these results by providing a means whereby such directors, officers and key employees may purchase shares of the common stock of the Company pursuant to options granted in accordance with the Plan.

Options granted pursuant to the Plan are intended to be either “incentive stock options” within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended from time to time (the “Code”), or “nonqualified stock options”, as shall be determined and designated upon the grant of each option hereunder.

2.                                       Administration

The Plan shall be administered by the Board of Directors (the “Board”), except if any stock options made pursuant to the Plan shall be subject to Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”), the Plan shall be administered by a committee (“Committee”) comprised solely of “outside directors” (within the meaning of Treasury Regulation §1.162-27(e)(3)) or such other persons as may be permitted from time to time under Section 162(m) of the Code and the Treasury Regulations promulgated thereunder.  Hereinafter the Board or Committee shall be referred to as the Administrator.  Any action of the Administrator with respect to the administration of the Plan shall be taken pursuant to a majority vote, or the unanimous written consent, of its members.  Subject to the express provisions of the Plan, the Administrator shall have the authority to construe and interpret the Plan, define the terms used herein, prescribe, amend and rescind, the rules and regulations relating to administration of the Plan, and make all other determinations necessary or advisable for administration of the Plan.

All decisions, determinations, interpretations or other actions by the Administrator shall be final, conclusive and binding on all persons, optionees, grantees, subsidiary corporations of the Company and any successors-in-interest to such parties.

3.                                       Incentive Stock Options

All options granted which are designated at the time of grant as an “incentive stock option” shall be deemed an incentive stock option.

B-1

(a)                                   Incentive stock options granted under the Plan are intended to be qualified under Section 422 of the Code.

(b)                                  Full-time salaried officers and key employees of the Company or a subsidiary corporation (as that term is defined in Section 424(f) of the Code), shall be eligible for selection to participate in the incentive stock option portion of the Plan.  No director of the Company who is not also a full-time salaried officer or employee of the Company or a subsidiary corporation, may be granted an incentive stock option hereunder.  Subject to the express provisions of the Plan, the Administrator shall (i) select from the eligible class of employees and determine to whom incentive stock options shall be granted, (ii) determine the discretionary terms and provisions of the respective incentive stock option agreements (which need not be identical), (iii) determine the times at which such incentive stock options shall be granted, (iv) determine the number of shares subject to each incentive stock option, and (v) grant such incentive stock options to such individuals.  An individual who has been granted an incentive stock option may, if he or she is otherwise eligible under the Plan, be granted additional incentive stock options if the Administrator shall so determine.

(c)                                   Except as described in subsection (e) below, the Administrator shall not grant an incentive stock option to purchase shares of the Company’s common stock to any individual who, at the time of the grant, owns stock possessing more than 10% of the total combined voting power or value of all classes of stock of the Company or a subsidiary corporation.  The attribution rules of Section 424(d) of the Code shall apply in the determination of ownership of stock for these purposes.

(d)                                  The aggregate fair market value (determined as of the time the incentive stock option is granted) of stock with respect to which incentive stock options are exercisable for the first time by an individual during any calendar year (under all plans of the Company and its subsidiary corporations, if any) shall not exceed $100,000, plus any greater amount as may be permitted under subsequent amendments to the Code.

(e)                                   The purchase price of stock subject to each incentive stock option shall be determined by the Administrator but shall not be less than one hundred percent (100%) of the fair market value of such stock at the time such option is granted, except, in the case of optionees who at the time of the grant own more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or a subsidiary corporation, in which case the purchase price of the stock shall not be less than one hundred ten percent (110%) of the fair market value of such stock at the time such option is granted and the term of such option shall be for no more than five (5) years.  The fair market value of such stock shall be the closing sales price for such stock (or the closing bid, if no sales were reported), if the Company’s stock is listed on any established stock exchange or a national market system, including the Nasdaq National Market for the last market trading day prior to the time of determination and reported in the Wall Street Journal or such other source as determined by the Administrator.  If the Company’s stock is not so listed, the fair market value shall be determined in good faith by the Administrator.

4.                                       Nonqualified Stock Options

(a)                                   All options granted which are (i) in excess of the aggregate fair market value limitations set forth in Section 3(d) hereof, (ii) designated at the time of the grant as “nonqualified”, or (iii) intended to be incentive stock options but do not meet the requirements of incentive stock options, shall be deemed nonqualified stock options.  Nonqualified stock options granted hereunder shall be so designated in the nonqualified stock option agreement entered into between the Company and the optionee.

B-2

(b)                                  Directors, full-time salaried officers and key employees of the Company or a subsidiary corporation shall be eligible for selection to participate in the nonqualified stock option portion of the Plan.  Subject to the express provisions of the Plan, the Administrator shall (i) select from the eligible class of individuals and determine to whom nonqualified stock options shall be granted, (ii) determine the discretionary terms and provisions of the respective nonqualified stock option agreements (which need not be identical), (iii) determine the times at which such nonqualified stock options shall be granted, (iv) determine the number of shares subject to each nonqualified stock option and (v) grant such nonqualified stock options to such individuals.  An individual who has been granted a nonqualified stock option may, if he or she is otherwise eligible under the Plan, be granted additional nonqualified stock options if the Administrator shall so determine.

(c)                                   The purchase price of stock subject to each nonqualified stock option shall be determined by the Administrator but shall not be less than one hundred percent (100%) of the fair market value of such stock at the time such option is granted.  The fair market value of such stock shall be determined in accordance with the last two sentences of Section 3(e) hereof.

5.                                       Stock Subject to the Plan

Subject to adjustments as provided in Section 12, hereof, the stock to be offered under the Plan shall be shares of the Company’s authorized but unissued common stock (hereinafter called “stock”) and the aggregate amount of stock to be delivered upon exercise of all options granted under the Plan shall not exceed 250,000 shares.  If any option shall be canceled, surrendered or expire for any reason without having been exercised in full, the underlying shares subject thereto shall again be available for purposes of the Plan.  Furthermore, the maximum aggregate number of shares that may be issued as incentive stock options under the Plan is 250,000 shares, subject to adjustments as provided in Section 12, hereof.

6.                                       Continuation of Employment

Nothing contained in the Plan (or in any option agreement) shall obligate the Company or a subsidiary corporation to employ any optionee for any period or interfere in any way with the right of the Company or a subsidiary corporation to reduce the optionee’s compensation.  However, the Company may not reduce the terms of any option without the approval of the optionee.

7.                                       Exercise of Options

No option shall be exercisable until all necessary regulatory and shareholder approvals of the Plan are obtained.  Except as otherwise provided in this section, each option shall be exercisable in such installments, which need not be equal, and upon such contingencies as the Administrator shall determine; provided, however, that if an optionee shall not in any given installment period purchase all of the shares which the optionee is entitled to purchase in such installment period, the optionee’s right to purchase any shares not purchased in such installment period shall continue until expiration or termination of such option.  Notwithstanding the foregoing, the options shall vest at the rate of at least 20% per year over a five year period from the date the option is granted.

B-3

Fractional share interests shall be disregarded, except that they may be accumulated.  Not less than ten (10) shares may be purchased at any one time unless the number of shares purchased is the total number of shares which is exercisable at such time.  Options may be exercised by written notice delivered to the Company stating the number of shares with respect to which the option is being exercised, together with the full purchase price for such shares.  Payment of the option price in full, for the number of shares to be delivered, must be made (a) in cash or (b) subject to applicable law, with the Company’s stock previously acquired by the optionee and held by the optionee for a period of at least six months.  Notwithstanding the foregoing, in the event an optionee who has an incentive stock option does exercise the incentive stock option by utilizing (b) above, the optionee should obtain tax advice as to the consequences of such action.  The equivalent dollar value of shares used to effect a purchase shall be the fair market value of the shares on the date of exercise.  If the option is being exercised by any person other than the optionee, said notice shall be accompanied by proof, satisfactory to counsel for the Company, of the right of such person to exercise the option.  Optionees will have no rights as shareholders with respect to stock of the Company subject to their stock option agreements until the date of issuance of the stock certificate to them.

8.                                       Nontransferability of Options

Each option shall, by its terms, be nontransferable by the optionee other than by will or the laws of descent and distribution, and shall be exercisable during his or her lifetime only by the optionee.

9.                                       Cessation of Directorship or Employment

If an optionee ceases to be a director or an employee of the Company or a subsidiary corporation for any reason other than his or her disability (as defined in Section 22(e)(3) of the Code) or death, the optionee’s option shall expire three (3) months after the date of termination of such directorship or employment, except (i) as provided in Sections 10 and 20 hereof in which case the option shall be exercisable as provided in those respective sections (ii) when the Optionee is changing his or her status from employee or employee-director to director in which case such stock option shall be converted to a nonqualified stock option three months and one day following such change in status and (iii) when Optionee is both a director and an employee in which case such Optionee’s nonqualified option shall expire three (3) months after the later of the date of termination of Optionee’s directorship or employment.  During the period after cessation of directorship or employment, such option shall be exercisable only as to those installments, if any, which have accrued and/or vested as of the date on which the optionee ceased to be a director or an employee of the Company or a subsidiary corporation.

10.                                Termination of Employment for Cause

If the stock option agreement so provides and if an optionee’s employment by the Company or a subsidiary corporation is terminated for cause, the optionee’s option shall expire thirty (30) days from the date of such termination.  Termination for cause shall include, but not be limited to, termination for malfeasance or gross misfeasance in the performance of duties or conviction of a crime involving moral turpitude, and, in any event, the determination of the Administrator with respect thereto shall be final and conclusive.

B-4

11.                                Disability or Death of Optionee

If any optionee dies while serving as a director or an employee of the Company or a subsidiary corporation, the option shall expire one (1) year after the date of such death, except as provided in Section 20 hereof.  After such death but before such expiration, the persons to whom the optionee’s rights under the option shall have passed by will or by the laws of descent and distribution or the executor or administrator of optionee’s estate shall have the right to exercise such option to the extent that installments, if any, had accrued and/or vested as of the date on which the optionee ceased to be a director or an employee of the Company or a subsidiary corporation.

If the optionee shall terminate his or her directorship or employment because of disability (as defined in Section 22(e)(3) of the Code), the optionee may exercise this option to the extent he or she is entitled to do so at the date of termination, at any time within one (1) year of the date of termination, except as provided in Section 20 hereof.

If any optionee dies during the three (3) month period referred to in Section 9 hereof, the option shall expire one (1) year after the date of such death, except as provided in Section 20 hereof.

12.                                Adjustment Upon Changes in Capitalization

If the outstanding shares of the stock of the Company are increased, decreased, changed into or exchanged for a different number or kind of shares or securities of the Company through reorganization, merger, recapitalization, reclassification, stock split, stock dividend, stock consolidation or otherwise, without consideration to the Company, an appropriate and proportionate adjustment shall be made in the number and kind of shares as to which options may be granted.  A corresponding adjustment changing the number or kind of shares and the exercise price per share allocated to unexercised options or portions thereof, which shall have been granted prior to any such change shall likewise be made.  Any such adjustment, however, in an outstanding option shall be made without change in the total price applicable to the unexercised portion of the option, but with a corresponding adjustment in the price for each share subject to the option.  Any adjustment under this Section 12 shall be made by the Administrator, whose determination as to what adjustments shall be made, and the extent thereof, shall be final and conclusive.  No fractional shares of stock shall be issued or made available under the Plan on account of any such adjustment, and fractional share-interests shall be disregarded, except that they may be accumulated.

13.                                Terminating Events

A Terminating Event shall be defined as any one of the following events: (i) a dissolution or liquidation of the Company; (ii) a reorganization, merger or consolidation of the Company with one or more corporations, the result of which (A) the Company is not the surviving corporation, or (B) the Company becomes a subsidiary of another corporation (which shall be deemed to have occurred if another corporation shall own directly or indirectly, over 80% of the aggregate voting power of all outstanding equity securities of the Company); (iii) a sale of substantially all the assets of the Company to another corporation; or (iv) a sale of the equity securities of the Company representing more than 80% of the aggregate voting power of all outstanding equity securities of the Company to any person or entity, or any group of persons and/or entities acting in concert.  When the Company knows that a Terminating Event will occur (i) the Company shall deliver to each optionee no less than thirty (30) days prior to the Terminating Event, written notification of the Terminating Event and the optionee’s right to exercise all options granted pursuant to the Plan, whether or not vested under the Plan or applicable stock option

B-5

agreement, and (ii) all outstanding options granted pursuant to the Plan shall completely vest and become immediately exercisable as to all shares granted pursuant to the option immediately prior to such Terminating Event.  This right of exercise shall be conditional upon execution of a final plan of dissolution or liquidation or a definitive agreement of consolidation or merger.  Upon the occurrence of the Terminating Event all outstanding options and the Plan shall terminate; provided, however, that any outstanding options not exercised as of the occurrence of the Terminating Event shall not terminate if there is a successor corporation which assumes the outstanding options or substitutes for such options, new options covering the stock of the successor corporation with appropriate adjustments as to the number and kind of shares and prices.

14.                                Amendment and Termination

The Administrator may at any time suspend, amend or terminate the Plan and may, with the consent of the optionee, make such modification of the terms and conditions of the option as it shall deem advisable; provided that, except as permitted under the provisions of Sections 12 and 13 hereof, no amendment or modification which would:

(a)                                   increase the maximum number of shares which may be purchased pursuant to options granted under the Plan either in the aggregate or by an individual;

(d)                                  permit options to be granted to anyone other than directors, full-time salaried officers or key employees of the Company or a subsidiary corporation;

may be adopted without the Company having first obtained any necessary regulatory and shareholder approvals required by law.

No option may be granted during any suspension or after termination of the Plan.  Amendment, suspension or termination of the Plan shall not (except as otherwise provided in Section 12 hereof), without the consent of the optionee, alter or impair any rights or obligations under any option theretofore granted.

15.                                Time of Granting Options

The time an option is granted, sometimes referred to as the date of grant, shall be the day of the action of the Administrator described in Sections 3(b) and 4(b) hereof; provided, however, that if appropriate resolutions of the Administrator indicate that an option is granted as of and on some future date, the time such option is granted shall be such future date.  If action by the Administrator is taken by unanimous written consent of its members, the action of the Administrator shall be deemed to be at the time the last member of the Administrator signs the consent.

B-6

16.                                Privileges of Stock Ownership; Securities Law Compliance; Notice of Sale

No optionee shall be entitled to the privileges of stock ownership as to any shares of stock not actually issued.  No shares shall be purchased upon the exercise of any option unless and until the Company has fully complied with all applicable requirements of any regulatory agency having jurisdiction over the Company including registration of the stock options and underlying shares, as necessary, and all applicable requirements of any exchange upon which stock of the Company may be listed.  The optionee shall give the Company notice of any sale or disposition of any such shares not more than five (5) days after such sale or disposition.

17.                                Effective Date of the Plan

The Plan shall be deemed adopted by the Administrator as of April 6, 2005 and shall be effective immediately subject to approval by the shareholders of the Company within twelve months of the date the Plan is adopted, by the vote of a majority of the outstanding shares represented and voting at a duly held meeting of shareholders at which a quorum is present, or by the written consent vote of the holders of a majority of the outstanding shares of the Company’s stock.  No option under the Plan shall be exercised prior to the shareholders’ approval of the Plan.

18.                                Termination

Unless previously terminated by the Administrator, the Plan shall terminate at the close of business on April 6, 2015.  No options shall be granted under the Plan thereafter, but such termination shall not affect any option theretofore granted.

19.                                Option Agreement

Each option shall be evidenced by a written stock option agreement executed by the Company and the optionee and shall contain each of the provisions and agreements herein specifically required to be contained therein, and such other terms and conditions as are deemed desirable and are not inconsistent with the Plan.  Each incentive stock option agreement shall contain such terms and provisions as the Administrator may determine to be necessary in order to qualify such option as an incentive stock option within the meaning of Section 422 of the Code.

20.                                Option Period

Each option and all rights and obligations thereunder shall expire on such date as the Administrator may determine, but not later than ten (10) years from the date such option is granted, and shall be subject to earlier termination as provided elsewhere in the Plan.

21.                                Exculpation and Indemnification

To the extent permitted by applicable law in effect from time to time, no member of the Administrator shall be liable for any act or omission of any other member of the Administrator nor for any act or omission on the member’s own part, except the member’s own willful misconduct or gross negligence.  The Company and its subsidiary corporations shall pay expenses incurred by, and satisfy a judgment or fine rendered or levied against, a present or former member of the Administrator in any action brought by a third party against such person (whether or not the Company is joined as a party defendant)

B-7

to impose a liability or penalty on such person while a member of the Administrator arising with respect to the Plan or administration thereof or out of membership on the Administrator or all or any combination of the preceding; provided, the Administrator determines in good faith that such member of the Administrator was acting in good faith, within what such member of the Administrator reasonably believed to be the scope of his or her employment or authority, and for a purpose which he or she reasonably believed to be in the best interests of the Company or its shareholders.  Payments authorized hereunder include amounts paid and expenses incurred in settling any such action or threatened action.  This Section 21 does not apply to any action instituted or maintained in the right of the Company by a shareholder or holder of a voting trust certificate representing shares of the Company or a subsidiary corporation thereof.  The provisions of this Section 21 shall apply to the estate, executor, administrator, heirs, legatees or devisees of a member of the Administrator and the term “person” as used in this Section 21 shall include the estate, executor, administrator, heirs, legatees or devisees of such person.

22.                                Agreement and Representations of Optionee

Unless the shares of stock covered by the Plan have been registered with the Securities Exchange Commission, each optionee shall, by accepting an option, represent and agree, for himself or herself and his or her transferees by will or the laws of descent and distribution, that all stock will be acquired for investment and not for resale or distribution.  Upon such exercise of any portion of an option, the person entitled to exercise the same shall, upon request of the Company, furnish evidence satisfactory to the Company (including a written and signed representation) to the effect that the stock is being acquired in good faith for investment and not for resale or distribution.  Furthermore, the Company, at its sole discretion, may take all reasonable steps, including affixing the following legend (and/or such other legend or legends as counsel shall require) on certificates embodying the shares:

The shares represented by this certificate have not been registered under the Securities Act of 1933 and may not be sold, pledged, hypothecated or otherwise transferred or offered for sale in the absence of an effective registration statement with respect to them under the Securities Act of 1933 or a written opinion of counsel for the optionee which opinion shall be acceptable to counsel for the Company that registration is not required.

to assure itself against any sale or distribution by the optionee which does not comply with the Plan or any federal or state securities laws.

The Company agrees to remove any legend affixed to the certificates embodying the shares pursuant to this Section 22 when all of the restrictions on the transfer of the shares, whether imposed by the Plan or federal or state law, have terminated.

23.                                Information to Employees

The Company shall provide optionees with financial statements of the Company at least annually.

B-8