SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act
of 1934 (Amendment No. )
Filed by 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 Rule 14a-11(c) or Rule 14a-12
(Name of Registrant as Specified In Its Charter)
UNITED FINANCIAL MORTGAGE CORP.
___________________________________________________________________________
(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)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
___________________________________________________________________________
(2) Aggregate numer of securities to which transactions applies:
___________________________________________________________________________
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined):
___________________________________________________________________________
(4) Proposed maximum aggregate value of transaction:
___________________________________________________________________________
(5) Total Fee Paid
___________________________________________________________________________
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
___________________________________________________________________________
(1) Amount Previously Paid:
___________________________________________________________________________
(2) Form, Schedule or Registration Statement No:
___________________________________________________________________________
(3) Filing Party:
___________________________________________________________________________
(4) Date Filed:
___________________________________________________________________________
UNITED FINANCIAL MORTGAGE CORP.
815 Commerce Drive
Suite 100
Oak Brook, Illinois 60523
August 1, 2003
Dear Stockholder:
Our Annual Meeting will be held on Friday, August 29, 2003, at
1:00 p.m., Central Daylight Savings Time, at the Renaissance Oak Brook
Hotel, 2100 Spring Road, Oak Brook, Illinois 60523.
The formal Notice of Annual Meeting of Stockholders and Proxy
Statement accompanying this letter describe the business requiring action at
the meeting. A presentation by Steve Khoshabe, the President and Chief
Executive Officer of the Company, will provide information on the business
and progress of our Company during fiscal 2003 and our directors and
officers will be available to answer your questions.
We appreciate the interest of our stockholders in United Financial
Mortgage Corp. and are pleased that in the past so many of you have
exercised your right to vote your shares. We hope that you continue to do
so.
Whether or not you plan to attend, please mark, sign, date and
mail the accompanying proxy card as soon as possible. The enclosed envelope
requires no postage if mailed in the United States. If you attend the
meeting, you may revoke your proxy and vote personally.
Cordially,
Joseph Khoshabe,
Chairman of the Board
UNITED FINANCIAL MORTGAGE CORP.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To Be Held August 29, 2003
To the Stockholders of
UNITED FINANCIAL MORTGAGE CORP.:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of
United Financial Mortgage Corp. (the "Company") will be held Friday, August
29, 2003, at 1:00 p.m., Central Daylight Savings Time, at the Renaissance
Oak Brook Hotel, 2100 Spring Road, Oak Brook, Illinois 60523 for the
following purposes:
1. To elect five (5) directors;
2. To ratify the appointment of Crowe Chizek and Company LLC as
independent auditors for the fiscal year ending April 30,
2004; and
3. To transact such other business as may properly come before
the meeting and any adjournment thereof.
The Board of Directors has fixed the close of business on July 25,
2003 as the record date for the determination of stockholders entitled to
notice of and to vote at the Annual Meeting.
Whether or not you plan to attend the Annual Meeting, you are
urged to mark, date and sign the enclosed proxy and return it promptly so
your vote can be recorded. If you are present at the meeting, you may revoke
your proxy and vote in person.
Date: August 1, 2003
By Order of the Board of Directors
/s/ Robert S. Luce
Robert S. Luce
Secretary
YOUR VOTE IS IMPORTANT. PLEASE COMPLETE, DATE, SIGN AND PROMPLY RETURN YOUR
PROXY IN THE ENCLOSED ENVELOPE, WHETHER OR NOT YOU PLAN TO ATTEND THE
MEETING IN PERSON.
UNITED FINANCIAL MORTGAGE CORP.
815 Commerce Drive, Suite 100
Oak Brook, Illinois 60523
PROXY STATEMENT
GENERAL INFORMATION
Use of Proxies
This Proxy Statement is furnished in connection with the solicitation
by the Board of Directors of United Financial Mortgage Corp. (the "Company")
of proxies to be voted at the Annual Meeting of Stockholders to be held on
Friday, August 29, 2003, in accordance with the foregoing notice. This Proxy
Statement and the accompanying proxy are being mailed to stockholders on or
about August 1, 2003.
Any proxy may be revoked by the person giving it at any time before it
is voted by delivering to the Secretary of the Company a written notice of
revocation or a duly executed proxy bearing a later date. Shares represented
by a proxy, properly executed and returned to the Company and not revoked,
will be voted at the Annual Meeting.
Shares will be voted in accordance with the directions of the
stockholder as specified on the proxy. In the absence of directions, the
proxy will be voted FOR the election of the directors named as the nominees
in this Proxy Statement and FOR the ratification of the appointment of Crowe
Chizek and Company LLC as the Company's independent auditors for the fiscal
year ending April 30, 2004. Any other matters that may properly come before
the meeting will be acted upon by the persons named in the accompanying
proxy in accordance with their discretion.
Record Date and Voting Securities
The close of business on July 25, 2003 has been fixed as the record
date (the "Record Date") for the determination of stockholders entitled to
notice of and to vote at the Annual Meeting and any adjournment thereof. As
of the Record Date, there were 4,095,229 shares of Common Stock outstanding
and entitled to vote at the Annual Meeting. Each share of Common Stock is
entitled to one vote, exercisable in person or by proxy. There are no other
outstanding securities of the Company entitled to vote, and there are no
cumulative voting rights with respect to the election of directors.
The presence, in person or by proxy, of a majority of the outstanding
shares of the Common Stock of the company is necessary to constitute a
quorum at the Annual Meeting. The Company's transfer agent tabulates the
votes. Abstentions and broker non-votes are included in the number of shares
present and voting for the purpose of determining if a quorum is present.
Abstentions also are included in the tabulation of votes cast on proposals
presented to the stockholders, but broker non-votes are not.
Expenses of Solicitation
All expenses of the solicitation of proxies will be paid by the
Company. Officers, directors and employees of the Company also may solicit
proxies by telephone, facsimile or in person.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table shows: (i) each person who is known to be the
beneficial owner as of April 30, 2003 of more than 5% of the Company's
Common Stock and (ii) with respect to each of the directors and nominees for
director of the Company, the executive officers named in the Summary
Compensation Table, and all directors and executive officers as a group, in
number, (a) the total number of shares of Common Stock beneficially owned as
of April 30, 2003 and (b) the percent of Common Stock so owned as of the
same date.
Amount & Percent
Nature of of
Beneficial Common
Name of Beneficial Owner Ownership(1)(4) Stock
------------------------ --------------- -----
Joseph Khoshabe (2) (5) 2,531,842(2) 61.8%
Steve Khoshabe 11,700 *
John A. Clark(3) 50,000 1.2%
Robert S. Luce(3) 100 *
Laurence B. Woznicki 384,870 9.3%
All directors and executive
officers as a group (6 persons) 2,978,512 72.73%
_____________________
* Less than 1%
(1) Calculated pursuant to Rule 13d-3(d) under the Securities Exchange Act
of 1934. Unless otherwise stated in these notes, each person has sole
voting and investment power with respect to all such shares. Under Rule
13d-3(d), shares not outstanding which are subject to options
exercisable within sixty days are deemed outstanding for the purpose of
computing the number and percentage owned by such person, but are not
deemed outstanding for the purpose of computing the percentage owned by
each other person listed. Includes shares which the listed beneficial
owner has a right to acquire within sixty days as follows: None. All
directors and executive officers as a group, six persons, hold
2,978,512 shares.
(2) Held by the Joseph Khoshabe Trust under Trust Agreement, dated
September 22, 1995 (the "J. K. Trust") of which Mr. Joseph Khoshabe is
the trustee.
(3) Held beneficially.
(4) Excludes 220,500 shares subject to options under the Company's stock
option plan.
(5) The J.K. Trust is the principal shareholder of the Company. Mr. Joseph
Khoshabe originally purchased the shares and then had them registered
in the name of the J.K. Trust for estate planning purposes. Mr. Joseph
Khoshabe, as the trustee of the J.K. Trust, is the beneficial owner of
2,531,842 shares of the Common Stock of the Company.
- 2 -
ITEM 1: ELECTION OF DIRECTORS
The nominees each were elected as directors at the Company's 2002
Annual Meeting of Shareholders. The terms of the directors will expire at
the 2003 Annual Meeting. No person, other than the directors of the Company
acting solely in that capacity, is responsible for the naming of the
nominees.
The Company's regular terms of office for the directors expire at the
2003 Annual Meetings of Stockholders. Five persons are to be elected at the
meeting to hold office as directors for a term of one (1) year and until
their respective successors are elected and qualified
Information as to each nominee follows. Unless otherwise indicated,
each nominee has served for at least five years in the business position
currently or most recently held. Information regarding beneficial ownership
is as of April 30, 2003.
On May 1, 2003 Mr. Steve Khoshabe was appointed by the Board of
Directors as President and Chief Executive Officer and Mr. Joseph Khoshabe
was re-appointed as Chairman of the Board.
NOMINEES FOR DIRECTORS
Joseph Khoshabe - Director since 1986, Age 58
Common Shares: Beneficially owned 2,531,842
Joseph Khoshabe was President and Chief Executive Officer of the
Company since its formation in 1986 through April 30, 2003. Mr. Khoshabe is
the Chairman of the Board and is responsible for the day-to-day operating
activities of the Company's commercial lending operations. Prior to
formation of the Company, Mr. Khoshabe was an executive with the Cracker
Jack Division of Borden, Inc., where he was employed for approximately 17
years. Mr. Khoshabe holds a Bachelor of Arts Degree in Business
Administration/Economics from Governors State University and a Bachelor of
Science/Accounting from Tehran University. Mr. Khoshabe is the father of
Mr. Steve Khoshabe, the President and Chief Executive Officer of the
Company.
John A. Clark - Director since July 19, 1998, Age 55
Member: Audit Committee and Compensation Committee (Chairman)
Common Shares: Beneficially owned 50,000
John A. Clark retired as President and Chief Executive Officer of a
Chicago area-banking group with $1.2 billion in assets in April of 1997.
Mr. Clark has a B.S. degree from the University of Wisconsin at Stevens
Point, Wisconsin.
Robert S. Luce - Director since July 19, 1998, Age 56
Member: Audit Committee and Compensation Committee
Common Shares: Beneficially owned 100
- 3 -
Robert S. Luce is an attorney who has been practicing financial
services law for 30 years. Mr. Luce completed his undergraduate work at the
University of Illinois and received his law degree from Loyola University
School of Law (Chicago) in 1972. Mr. Luce was an attorney with the United
States Securities and Exchange Commission from 1972 to 1976. Mr. Luce was an
adjunct professor of law at Loyola University of Law (Chicago) in the area
of securities regulations from 1972 to 1980. Mr. Luce has served as
corporate counsel to Fortune 500 companies and has been a partner in two
Chicago area law firms. Mr. Luce started his own law firm in 1989 and
continues in that capacity.
Elliot R. Jacobs - Director nominee, Age 58
Common Shares: None Beneficially owned
Elliot R. Jacobs is a professional in the mortgage banking industry.
Mr. Jacobs is a frequent speaker and contributing author on topics for the
Mortgage Bankers Association of America. Mr. Jacobs has been a director of
the mortgage banking strategies group of First Fidelity Capital Markets,
Inc. of Boca Raton, Florida since 1998. During the period from 1993 to 1998,
Mr. Jacobs was the director of the Mergers and Acquisitions group of
CoreStates Capital Markets, a division of CoreStates Bank of Fort
Lauderdale, Florida. Mr. Jacobs earned a B. S. in Accounting and an MBA in
Management Information Systems, with honors, from the American University.
James R. Zuhlke - Director nominee, Age 57
Member: Audit Committee (Chairman)
Common Shares - None beneficially owned
James R. Zuhlke has over 22 years of experience as an insurance
executive. During that time, Mr. Zuhlke started and managed seven different
insurance companies, including both domestic and overseas captives. Mr.
Zuhlke was founder, President and Chairman of the Board of Intercargo
Corporation, which became publicly traded in 1988.
Mr. Zuhlke currently is the President of Kingsway America, Inc.; a
holding company for six operating subsidiaries of the Kingsway Financial
Services Group, which Mr. Zuhlke assisted in becoming a public company in
1995.
Mr. Zuhlke received his BBA from the University of Wisconsin in 1968
and also received his law degree (JD) from the University of Wisconsin in
1971.
Board of Directors
The Company's Board of Directors has the responsibility to review the
overall operations of the Company. The members of the Board are kept
informed of the Company's results of operations and proposed plans and
business objectives by the Company's management. During fiscal 2003, the
Board of Directors met six times. All of the directors attended at least 75%
of those meetings and meetings of the committees on which they served. The
committees of the Board of Directors include the Audit Committee and the
Compensation Committee.
- 4 -
Effective as of May 1, 2003, the members of the Board of Directors are
compensated as follows: a monthly retainer of $500; $500 for attendance at
each meeting of the Board of Directors; $250 for attendance at each
Committee meeting of the Board of Directors (e.g., Audit and Compensation
Committees); and the Chairman of the Audit Committee is paid $500 for
attendance at each Audit Committee meeting. Each board member also is
issued annually a stock option for 10,000 shares under the terms of the
Company's non-qualified and incentive stock option plan.
Audit Committee
The Audit Committee of the Board of Directors is composed of three (3)
directors, none of whom is an employee of the Company. The Audit Committee
is governed by a charter approved by the Board of Directors. In accordance
with its Charter, the Audit Committee assists the Board of Directors in
carrying out its responsibilities for monitoring management's accounting for
the Company's financial results and for the timeliness and adequacy of the
reporting of those results; discusses and makes inquiry into the audits of
the Company's books made internally and by outside independent auditors, the
Company's financial and accounting policies, its internal controls and its
financial reporting; and investigates and makes a recommendation to the
Board of Directors each year with respect to the appointment of independent
auditors for the following year. Current members of the Audit Committee are
John A. Clark, Robert S. Luce and Mr. James R. Zuhlke, Chairman who was
appointed to the committee at the June 12, 2002 Board of Directors meeting.
Each of the members meets the current independence and experience
requirements of the American Stock Exchange. The Audit Committee met four
times during the past fiscal year.
Notwithstanding anything to the contrary set forth in any of the
Company's filings under the Securities Act of 1933 or the Securities
Exchange Act of 1934 that might incorporate filings, including this Proxy
Statement, in whole or in part, the following report shall not be
incorporated by reference into any such filings.
Report of the Audit Committee
In discharging its oversight responsibility as to the audit process,
the Audit Committee obtained from the independent auditors a formal written
statement describing all relationships between the auditors and the Company
that might bear on the auditors' independence consistent with Independence
Standards Board Standard No. 1 "Independence Discussions with Audit
Committees" and discussed with the auditors any relationships that may
impact their objectivity and independence. The Audit Committee discussed and
reviewed with the independent auditors all communications required by
generally accepted auditing standards, including those described in
Statement on Auditing Standards No. 61, as amended, "Communication with
Audit Committees". The Audit Committee reviewed and discussed the audited
consolidated financial statements of the Company as of and for the fiscal
year ended April 30, 2003, with management and the independent auditors.
- 5 -
Management of the Company is responsible for the preparation,
presentation and integrity of the Company's financial statements, the
Company's accounting and financial reporting principles, and internal
controls designed to assure compliance with accounting standards and
applicable laws and regulations. The independent auditors are responsible
for auditing the Company's financial statements and expressing an opinion as
to their conformity with accounting principles generally accepted in the
United States. Management has represented to the Audit Committee that the
Company's financial statements were prepared in accordance with generally
accepted accounting principles. It is not the duty of the Audit Committee to
plan or conduct audits or to determine that the Company's financial
statements are complete and accurate and in accordance with generally
accepted accounting principles.
Based on the above-mentioned review and discussions with management and
the independent auditors, the Audit Committee recommended to the Board of
Directors that the Company's audited consolidated financial statements be
included in its Annual Report on Form 10-KSB for the fiscal year ended April
30, 2003, for filing with the Securities and Exchange Commission.
Audit Committee
---------------
James R. Zuhlke (Chairman)
Robert S. Luce
John A. Clark
A copy of the Audit Committee Charter is attached hereto as Appendix B.
Compensation Committee
The Compensation Committee periodically reviews management requests for
grants of stock options; reviews stock option plan administration matters,
and reviews executive and key employee compensation matters. The
Compensation Committee members are John A. Clark, Chairman, and Robert S.
Luce. The Compensation Committee met two times during the past fiscal year.
- 6 -
SUMMARY COMPENSATION TABLE
Annual Compensation
Other Annual
Name and Compensation
Principal Position Year Salary Bonus (1)(2)(3)(4)
-------------------------- ---- -------- -------- ------------
Joseph Khoshabe, Chairman 2003 $250,000 $546,054 $ 8,401
of the Board 2002 $250,500 $130,000 $ 10,354
2001 $250,000 $157,000 $ 10,354
Steve Y. Khoshabe, President 2003 $165,000 $465,792 $ 3,664
and Chief Executive Officer 2002 $140,000 $120,000 $ 3,739
2001 $140,000 -0- $ 3,739
___________________________________
(1) Includes: $8,401 for annual health insurance premiums for Mr. Joseph
Khoshabe and his dependents; and $3,664 for annual health insurance
premiums for Steve Khoshabe and his dependents.
(2) Does not include a $25,000 annual car allowance payable to Mr. Joseph
Khoshabe.
(3) Does not include a $12,000 annual car allowance payable to Steve
Khoshabe.
(4) During the last fiscal year Mr. Joseph Khoshabe was granted an option
to purchase 25,000 shares of common stock of the company at an exercise
price of $2.70 per share; and Mr. Steve Khoshabe was granted an option
to purchase 90,000 shares at an exercise price of $2.70 per share.
STOCK OPTION PLAN
On December 19, 1993, the Company adopted a Non-qualified and Incentive
Stock Option Plan ("Plan") which provides for the grant of non-qualified
stock options and incentive stock options. 500,000 shares of Common Stock
have been reserved for issuance under the Plan. Non-qualified stock options
for 413,800 shares have been granted to employees and directors at an
average weighted exercise price of $3.67 per share. Each of the nominee
directors was granted a stock option for 5,000 shares at an option exercise
price of $2.70 per share during fiscal 2002.
- 7 -
EMPLOYMENT TERMS FOR STEVE KHOSHABE
On May 1, 2003, the Company entered into the following employment terms
with Mr. Steve Khoshabe to retain his services at the Company as President
and Chief Executive Officer. The employment terms contain the following
important provisions:
Term: One year
Annual Salary: $250,000
Health Insurance: Actual cost (1)
Car Allowance: $12,000
Long Term Disability Insurance: Actual cost(1)
Incentive Compensation: Additional compensation in the
amount of ten percent of the Company's
net income before incomes taxes in
excess of $3.5 million up to $10.5
million, and an additional fifteen
percent of the Company's net income
before income taxes in excess of
$10.5 million.
________________________________________
(1) These items may increase in the future subject to premium costs.
EMPLOYMENT TERMS FOR JOSEPH KHOSHABE
On May 1, 2003, the Company entered into the following employment terms
with Mr. Joseph Khoshabe to retain his services to the Company as Chairman
of the Board. The employment terms contains the following important
provisions:
Term: One year
Annual Salary: $450,000
Health Insurance: Actual cost (1)
Car Allowance: $25,000
Long Term Disability Insurance: Actual cost (1)
Incentive Compensation: Additional compensation
in the amount of ten percent
of the Company's net income before
income taxes relating solely to the
Company's commercial lending
operations.
_______________________________________
(1) These items may increase in the future subject to premium costs.
- 8 -
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company has entered into a compensation agreement with Fidelity
Capital Markets, Inc. ("Fidelity") of which Mr. Elliot Jacobs is a
principal. The Agreement provides for Fidelity to receive as compensation
ten percent of net revenues earned by any mortgage banking or other
opportunity introduced by Fidelity to the Company. It is contemplated that
Fidelity's services may include locating and analyzing mortgage banking
transactions that may have potential interest to the Company and its present
or future business operations; the presentation of this analysis to senior
management of the Company for their review and consideration; negotiation
and liaison between the Company and prospective business candidates and the
provision of consulting services to the Company about issues that arise
during the course of contract negotiations; closing matters and operational
advice after the consummation of a transaction.
As of the date hereof, the Company has entered into one mortgage
banking transaction with a person introduced to the Company by Fidelity.
Management and Fidelity both believe that the compensation arrangement
is competitive in the marketplace and fair to the Company.
The Company's Board of Directors authorized the issuance of 213 shares
of Series A Non-Voting Preferred stock ("Preferred Stock"). The outstanding
shares of Preferred Stock were purchased from the Company for total cash
consideration of $1,065,000 or $5,000 per share. The 213 shares of
Preferred Stock include 113 shares purchased by the J.K. Trust on June 10,
1996 for a cash payment to the Company of $565,000.
On June 5, 1998, 150 shares of the Preferred Stock were redeemed by the
Company for a redemption price of $750,000 and no longer are outstanding.
The redemption price for the Preferred Stock represents the original
purchase price for such shares. The decision to redeem the shares by the
Company was made solely by the holder of such shares, namely Mr. Joseph
Khoshabe, the Chairman of the Board and the then President and sole director
of the Company.
The J.K. Trust for which Mr. Joseph Khoshabe is the trustee holds all
63 shares of Preferred Stock. The Company may pay variable dividends with
respect to the Preferred Stock as determined by the Board of Directors of
the Company on an annual basis.
As an affiliate of the Company within the meaning of Rule 144(a)(1),
the J.K. Trust is subject to the volume limitations of Rule 144(e) with
respect to any sales by it. Generally, the maximum amount of securities
that an be sold by a control affiliate during a three-month period pursuant
to Rule 144 is limited to the greater of one percent of the outstanding
securities of the Company or the average weekly volume traded for the four-
week period prior to the date of filing the required notification of sale.
- 9 -
ITEM 2 - RATIFICATION OF THE APPOINTMENT OF
CROWE CHIZEK AND COMPANY LLC AS THE COMPANY'S
INDEPENDENT AUDITORS FOR THE FISCAL
YEAR ENDING APRIL 30, 2004
The Audit Committee has considered the qualifications of Crowe Chizek
and Company LLC ("Crowe Chizek") and has appointed Crowe Chizek as
independent auditors of the Company for the fiscal year ending April 30,
2004. A resolution ratifying the appointment will be offered at the meeting.
If the resolution is not adopted, the adverse vote will be considered as a
direction to the Audit Committee to select other auditors for the following
year. Because of the difficulty and expense of making any substitution of
auditors so long after the beginning of the current year, it is contemplated
that the appointment for the fiscal year 2004 will stand unless the Audit
Committee finds other good reason for making a change.
Fees paid to Crowe Chizek for professional services rendered to the
Company during 2003 were as follows: Audit fees and all other fees,
including audit related services of $30,000 and other non-audit related
services of $10,000. Other non-audit related services include tax return
preparation and consultation. No services were performed or fees incurred in
connection with financial information systems design and implementation
projects during 2003. The Audit Committee considered the effects that the
provision of non-audit services may have on the Company's independent
auditors' independence.
A representative of Crowe Chizek will be present at the Annual Meeting
to respond to appropriate questions and to make a statement if the
representative so desires.
000
Ratification requires the affirmative vote by holders of at least a
majority of outstanding shares voting at the Annual Meeting.
THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE
IN FAVOR OF RATIFICATION OF THE APPOINTMENT OF
CROWE CHIZEK AS THE COMPANY'S
INDEPENDENT AUDITORS FOR FISCAL 2004
SECTION 16 (a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's officers and directors, and persons who own more than 10% of a
registered class of the Company's equity securities, to file certain reports
regarding ownership of, and transactions in, the Company's securities with
the Securities and Exchange Commission. Such officers, directors and 10%
stockholders also are required by Securities and Exchange Commission rules
to furnish the Company with copies of all Section 16(a) forms that they
file. Based solely on its review of the copies of such forms received by it,
or written representations from certain reporting persons, the Company
believes that for the year ended April 30, 2003, all reporting persons
complied with Section 16(a) filing requirements.
- 10 -
DEADLINE FOR RECEIPT OF STOCKHOLDER PROPOSALS
Proposals of stockholders of the Company which are intended to be
presented by such stockholders at the Company's 2004 Annual Meeting of
Stockholders must be received by the Company no later than February 1, 2004
to be included in the proxy statement and form of proxy relating to that
meeting.
OTHER MATTERS
Officers and other employees of the Company and its subsidiaries may
solicit proxies by personal interview, telephone and telegram, in addition
to the use of the mails. None of these individuals will receive special
compensation for these services which will be performed in addition to their
regular duties, and some of them may not necessarily solicit proxies. The
Company also has made arrangements with brokerage firms, banks, nominees and
other fiduciaries to forward proxy solicitation materials for shares held of
record by them to the beneficial owners of such shares. The Company will
reimburse them for reasonable out-of-pocket expenses. Corporate Stock
Transfer, Inc., 3200 Cherry Creek Drive South, Suite 430, Denver, Colorado
80209 will assist in the distribution of proxy solicitation materials, for a
fee estimated at $3,000, plus out-of-pocket expenses. The Company will pay
the cost of proxy solicitation.
APPENDIX A
The Summary of Selected Financial Data; Management's Discussion and
Analysis of Financial Condition and Results of Operations; the Financial
Statements, including: Statements of Operations, Statements of Financial
Position, Statement of Shareholders' Equity, and Statements of Cash Flows;
Notes to Consolidated Financial Statements; and Independent Auditor's Report
for the fiscal year ended April 30, 2003 are incorporated herein by
reference from the Company's Annual Report on Form 10-KSB as filed with the
United States Securities and Exchange Commissions on or about July 30, 2003.
By Order of the Board of Directors
/S/ Robert S. Luce
----------------------------------
Secretary, Robert S. Luce
Dated: August 1, 2003
APPENDIX B
UNITED FINANCIAL MORTGAGE CORP
CHARTER OF THE
AUDIT COMMITTEE
Purpose: The Audit Committee ("Committee") reviews the Company's quarterly
and annual financial statements and other financial information included in
or incorporated by reference in the Company's Proxy Statement, Form 10-KSB
and other reports to shareholders.
The Committee also reviews recommendations of the Company's independent
auditors and internal auditors on accounting methods and internal controls.
The Committee may make recommendations to the Board of Directors on the
scope of the audits. The Committee may review reports prepared by the
independent public accountants and internal auditors on management's
compliance with laws and the Company's business conduct and ethics policies.
The Committee may conduct independent inquiries. The Committee recommends to
the Board of Directors the appointment of independent auditors. The
Committee shall be entitled to call upon the service of the Company's
officers and outside advisors for such assistance as it may request in the
fulfillment of these purposes.
Membership: The Audit Committee shall be composed of three (3) non-employee
members of the Board of Directors. The Board shall be entitled to fill any
vacancies in its membership. The Committee may appoint a Chairman and
Secretary of the Committee.
Decision Making: Actions of the Committee shall be taken by a vote of not
less than a majority of its members.
Meeting Schedules: The Committee shall meet on a calendar quarter basis at
such places and times as shall be convenient to the members of the
Committee.
June 19, 1998
PROXY BALLOT FORM
-----------------
UNITED FINANCIAL MORTGAGE CORP.
Proxy Solicited on Behalf of The Board of Directors
For The Annual Meeting of Stockholders - August 29, 2003
The undersigned appoints Joseph Khoshabe and Robert S. Luce and each of
them, as proxies, with full power of substitution and revocation, to vote,
as designated below, all the Common Stock of United Financial Mortgage Corp.
which the undersigned has power to vote, with all powers which the
undersigned would possess if personally present, at the annual meeting of
stockholders to be held on August 29, 2003 or at any adjournment thereof.
Unless otherwise marked, this proxy will be voted FOR the election of
the nominees for director named, and FOR Proposal No. 2 and in their
discretion, the Proxies may vote upon any other business that properly comes
before the meeting.
PLEASE VOTE, SIGN, DATE AND RETURN THIS PROXY BALLOT FORM PROMPTLY USING THE
ENCLOSED ENVELOPE.
BALLOT
------
ANNUAL MEETING OF STOCKHOLDERS - August 29, 2003
------------------------------------------------
1. For Election of
Directors
(Mark only one) [ ] Vote FOR all [ ] Vote WITHHELD
nominees listed from all nominees
below (EXCEPT Joseph Khoshabe
as directed to the John A. Clark
contrary below) Robert S. Luce
Joseph Khoshabe Elliot R. Jacobs
John A. Clark James R. Zuhlke
Robert S. Luce
Elliot R. Jacobs
James R. Zuhlke
INSTRUCTIONS: To withhold vote for any individual nominee, write that
nominee's name in the space provided below.
____________________________________________________________________________
For Against Abstain
2. For ratification of the appointment [ ] [ ] [ ]
of Crowe Chizek and Company
LLC as the Company's Independent
Auditors
____________________________________________________________________________
Print Name of Stockholder Signature of Stockholder or Proxy
____________________________________________________________________________
Address Number of Shares
___________________________________
Date