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As filed with the Securities and Exchange Commission on
November 12, 1998
Registration No. 333-63625
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
________________________
AMENDMENT NO. 2
TO
FORM SB-2
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
________________________
PEOPLES BANKCORP, INC.
(Name of Small Business Issuer in its charter)
<TABLE>
<CAPTION>
NEW YORK 6035 [TO BE APPLIED FOR]
--------- ---- -------------------
<S> <C> <C>
(State or other jurisdication (Primary standard industrial (I.R.S. employer
of incorporation or organization) classification code number) identification number)
</TABLE>
825 STATE STREET
OGDENSBURG, NEW YORK 13669
(315) 393-4340
(Address and telephone number of principal executive offices and
principal place of business)
ROBERT E. WILSON, PRESIDENT
AND CHIEF EXECUTIVE OFFICER
PEOPLES BANKCORP, INC.
825 STATE STREET
OGDENSBURG, NEW YORK 13669
(315) 393-4340
(Name, address and telephone number of agent for service)
COPIES TO:
Gary R. Bronstein, Esquire
Joan S. Guilfoyle, Esquire
Housley Kantarian & Bronstein, P.C.
1220 19th Street, N.W., Suite 700
Washington, D.C. 20036
APPROXIMATE DATE OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after this registration statement becomes effective.
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act,
please check the following box and list the Securities Act
registration statement number of the earlier effective
registration statement for the same offering.[ ] _____________
If this Form is a post-effective amendment filed pursuant to
Rule 462(c) under the Securities Act, check the following box
and list the Securities Act registration statement number of the
earlier effective registration statement for the same offering.
[ ] ________
If this Form is a post-effective amendment filed pursuant to
Rule 462(d) under the Securities Act, check the following box
and list the Securities Act registration statement number of the
earlier effective registration statement for the same offering.
[ ] _________
If delivery of the prospectus is expected to be made pursuant to
Rule 434, please check the following box. [ ]
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THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON
SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE
DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH
SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL
THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE SECURITIES AND
EXCHANGE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY
DETERMINE.
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PART II: INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 13. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
* Legal Fees and Expenses . . . . . . . . . . . $ 50,000
* Printing, Word Processing, Postage and
Mailing. . . . . . . . . . . . . . . . . . . 40,000
* Appraisal and Business Plan Fees
and Expenses . . . . . . . . . . . . . . . . 19,000
* Accounting Fees and Expenses. . . . . . . . . 75,000
* Blue Sky Filing Fees and Expenses
(including counsel fees). . . . . . . . 10,000
* Transfer Agent Fees . . . . . . . . . . . 3,000
* Conversion Agent Fees . . . . . . . . . . 6,000
* Federal Filing Fees (OTS and SEC) . . . . 9,000
* Other Expenses. . . . . . . . . . . . . . 8,000
--------
Total . . . . . . . . . . . . . . . . . . $220,000
========
__________
* Estimated
** Does not include $90,500 in estimated underwriting fees and
expenses.
ITEM 14. INDEMNIFICATION OF DIRECTORS AND OFFICERS
INDEMNIFICATION OF DIRECTORS AND OFFICERS OF OGDENSBURG
FEDERAL SAVINGS AND LOAN ASSOCIATION
Federal Regulations clearly define areas for indemnity coverage
by Ogdensburg Federal Savings and Loan Association (the
"Association"), as follows:
(a) Any person against whom any action is brought by
reason of the fact that such person is or was a director or
officer of the Association shall be indemnified by the
Association for:
(i) Reasonable costs and expenses, including
reasonable attorney's fees, actually paid or
incurred by such person in connection with pro-
ceedings related to the defense or settlement of
such action;
(ii) Any amount for which such person becomes
liable by reason of any judgment in such action;
(iii) Reasonable costs and expenses, including
reasonable attorney's fees, actually paid or
incurred in any action to enforce his rights under
this section, if the person attains a final judgment
in favor of such person in such enforcement action.
(b) Indemnification provided for in subparagraph (a)
shall be made to such officer or director only if the
requirements of this subparagraph are met:
(i) The Association shall make the indemnification
provided by subparagraph (a) in connection with any
such action which results in a final judgment on the
merits in favor of such officer or director.
(ii) The Association shall make the indemnification
provided by subparagraph (a) in case of settlement
of such action, final judgment against such director
or officer or final judgment in favor of such direc-
tor or officer other than on the merits except in
relation to matters as to which he shall be adjudged
to be liable for negligence or misconduct in the
performance of his duty, only if a majority of the
directors of the Association determines that such a
director or officer was acting in good faith within
what he was reasonably entitled to believe under the
circumstances was the scope
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of his employment or authority and for a purpose which
he was reasonably entitled to believe under the
circumstances was in the best interest of the
Association or their members or stockholders.
(c) As used in this paragraph:
(i) "Action" means any action, suit or other
judicial or administrative proceeding, or threatened
proceeding, whether civil, criminal, or otherwise,
including any appeal or other proceeding for review;
(ii) "Court" includes, without limitation, any
court to which or in which any appeal or any
proceeding for review is brought;
(iii) "Final Judgment" means a judgment, decree, or
order which is appealable and as to which the period
for appeal has expired and no appeal has been taken;
(iv) "Settlement" includes the entry of a judgment
by consent or by confession or upon a plea of guilty
or of nolo contendere.
Ogdensburg Federal has a directors and officers liability
policy providing for insurance against certain liabilities
incurred by directors and officers of Ogdensburg Federal while
serving in their capacities as such.
INDEMNIFICATION OF DIRECTORS AND OFFICERS OF PEOPLE'S BANKCORP,
INC.
Under the New York Business Corporation Law ("NYBCL"), a
corporation may indemnify its directors and officers made, or
threatened to be made, a party to any action or proceeding,
except for stockholder derivative suits, if such director or
officer acted in good faith, for a purpose which he or she
reasonably believed to be in or, in the case of service to
another corporation or enterprise, not opposed to, the best
interests of the corporation, and, in criminal proceedings, had
no reasonable cause to believe his or her conduct was unlawful.
In the case of stockholder derivative suits, the corporation may
indemnify a director or officer if he or she acted in good faith
for a purpose which he or she reasonably believed to be in or,
in the case of service to another corporation or enterprise, not
opposed to the best interests of the corporation, except that no
indemnification may be made in respect of (i) a threatened
action, or a pending action which is settled or otherwise
disposed of, or (ii) any claim, issue or matter as to which such
person has been adjudged to be liable to the corporation, unless
and only to the extent that the court in which the action was
brought, or, if no action was brought, any court of competent
jurisdiction, determines upon application that, in view of all
the circumstances of the case, the person is fairly and
reasonably entitled to indemnity for such portion of the
settlement amount and expenses as the court deems proper.
Any person who has been successful on the merits or
otherwise in the defense of a civil or criminal action or
proceeding will be entitled to indemnification. Except as
provided in the preceding sentence, unless ordered by a court
pursuant to the NYBCL, any indemnification under the NYBCL
pursuant to the above paragraph may be made only if authorized
in the specific case and after a finding that the director or
officer met the requisite standard of conduct by (i) the
disinterested directors if a quorum is available, (ii) the board
upon the written opinion of independent legal counsel or (iii)
the stockholders.
The indemnification described above under the NYBCL is not
exclusive of other indemnification rights to which a director or
officer may be entitled, whether contained in the certificate of
incorporation or bylaws or when authorized by (i) such
certificate of incorporation or bylaws, (ii) a resolution of
stockholders, (iii) a resolution of directors, or (iv) an
agreement providing for such indemnification, provided that no
indemnification may be made to or on behalf of any director or
officer if a judgment or other final adjudication adverse to the
director or officer establishes that his or her acts were
committed in bad faith or were the result of active and
deliberate dishonesty and
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were material to the cause of action so adjudicated, or that he
or she personally gained in fact a financial profit or other
advantage to which he or she was not legally entitled.
The foregoing statement is qualified in its entirety by
reference to Section 715, 717, 721 through 725 of the NYBCL.
DIRECTORS AND OFFICERS LIABILITY INSURANCE
Pursuant to its Charter and New York law, the Company is
permitted to purchase and maintain insurance on behalf of an
individual who is or was a director, officer, employee, or agent
of the Company. The Association currently maintains such a
policy and it is intended that the Company will become a party
to such policy.
ELEVENTH:
A. RIGHT TO INDEMNIFICATION. Each person who was
or is made a party or is threatened to be made a party to
or is otherwise involved in any action, suit or
proceeding, whether civil, criminal, administrative or
investigative (hereinafter a "proceeding"), by reason of
the fact:
(1) that he or she is or was a director or
officer of the Corporation, or
(2) that he or she, being at the time a
director or officer of the Corporation, is or was
serving at the request of the Corporation as a
director, trustee, officer, employee or agent of
another corporation or of a partnership, joint
venture, trust or other enterprise, including
service with respect to an employee benefit plan
(collectively, "another enterprise" or "other
enterprise"), whether either in case (i) or in case
(ii) the basis of such proceeding is alleged action
or inaction (x) in an official capacity as a
director or officer of the Corporation, or as a
director, trustee, officer, employee or agent of
such other enterprise, or (y) in any other capacity
related to the Corporation or such other enterprise
while so serving as a director, trustee, officer,
employee or agent, shall be indemnified and held
harmless by the Corporation to the fullest extent
authorized by the Business Corporation Law, as the
same exists or may hereafter be amended (but, in the
case of any such amendment, with respect to actions
taken prior to such amendment, only to the extent
that such amendment does not prohibit the
Corporation from providing broader indemnification
rights than permitted prior thereto), against all
expense, liability and loss (including, without
limitation, attorneys' fees, judgments, fines, ERISA
excise taxes or penalties and amounts paid in
settlement) reasonably incurred or suffered by such
person in connection therewith. The persons
indemnified by this Article Eleventh are hereinafter
referred to as "indemnitees." Such indemnification
as to such alleged action or inaction shall continue
as to an indemnitee who has after such alleged
action or inaction ceased to be a director or
officer of the Corporation, or director, officer,
employee or agent of another enterprise; and shall
inure to the benefit of the indemnitee's heirs,
executors and administrators. The right to
indemnification conferred in this Article Eleventh:
(i) shall be a contract right; (ii) shall not be
affected adversely as to any indemnitee by any
amendment of this Certificate of Incorporation with
respect to any action or inaction occurring prior to
such amendment; and (iii) shall, subject to any
requirements imposed by law and the Bylaws, include
the right to be paid by the Corporation the expenses
incurred in defending any such proceeding in advance
of its final disposition.
B. RELATIONSHIP TO OTHER RIGHTS AND PROVISIONS
CONCERNING INDEMNIFICATION. The rights to indemnification
and to the advancement of expenses conferred in this
Article Eleventh shall not be exclusive of any other right
which any person may have or hereafter acquire under any
statute, this Certificate of Incorporation, Bylaws,
agreement (including any agreement between such person and
any of the Corporation's affiliates, predecessor or
subsidiary corporations or any constituent corporation
absorbed by the Corporation in a consolidation or merger),
vote of shareholders or disinterested directors or
otherwise. The Bylaws may
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contain such other provisions concerning indemnification,
including provisions specifying reasonable procedures
relating to and conditions to the receipt by indemnitees of
indemnification, provided that such provisions are not
inconsistent with the provisions of this Article Eleventh.
C. AGENTS AND EMPLOYEES. The Corporation may, to
the extent authorized from time to time by the Board of
Directors and to the fullest extent authorized by the
Business Corporation Law, as the same exists or may
hereafter be amended, grant rights to indemnification, and
to the advancement of expenses, to any employee or agent
of the Corporation (or any person, other than a director
or officer of the Corporation, serving at the
Corporation's request as a director, trustee, officer,
employee or agent of another enterprise) or to persons who
are or were a director, officer, employee or agent of any
of the Corporation's affiliates, predecessor or subsidiary
corporations or of a constituent corporation absorbed by
the Corporation in a consolidation or merger or who is or
was serving at the request of such affiliate, predecessor
or subsidiary corporation or of such constituent
corporation as a director, officer, employee or agent of
another enterprise, in each case as determined by the
Board of Directors to the fullest extent of the provisions
of this Article Eleventh in cases of the indemnification
and advancement of expenses of directors and officers of
the Corporation, or to any lesser extent (or greater
extent, if permitted by law) determined by the Board of
Directors. Nothing in this Article Eleventh C. shall
limit the indemnification provided in Article Eleventh A.
hereof to any officer or director of the Corporation who
was or is made a party or is threatened to be made a party
to or is otherwise involved in any proceeding by reason of
the fact that he or she is or was serving at the request
of the Corporation as a director, officer, trustee,
employee or agent of any subsidiary of the Corporation or
any other enterprise.
ITEM 15. RECENT SALES OF UNREGISTERED SECURITIES.
Not applicable.
Item 16. Exhibits and Financial Statement Schedules:
The exhibits and financial statement schedules filed as a
part of this registration statement are as follows:
(a) LIST OF EXHIBITS
EXHIBIT NO. DESCRIPTION
---------- -----------
* 1 Agency Agreement with Trident Securities, Inc.
* 2 Plan of Conversion (Exhibit A to Proxy
Statement filed as Exhibit 99.2)
* 3.1 Certificate of Incorporation of Peoples Bankcorp,
Inc.
* 3.2 Bylaws of People's Bankcorp, Inc.
* 4 Form of Common Stock Certificate of Peoples
Bankcorp, Inc.
* 5 Opinion of Housley Kantarian & Bronstein, P.C.
regarding legality of securities being registered
8.1 Federal Tax Opinion of Housley Kantarian &
Bronstein, P.C.
8.2 State Tax Opinion of Silver & Silver
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<PAGE>
* 8.3 Opinion of Feldman Financial Advisors as to the
value of subscription rights for tax purposes
* 10.1 Proposed People's Bankcorp, Inc. 1999 Stock Option
and Incentive Plan
* 10.2 Proposed People's Bankcorp, Inc. Management
Recognition Plan and Trust Agreement
* 10.3 Employment Agreement between Ogdensburg Federal
Savings and Loan Association and Robert E. Wilson
* 10.4 Guaranty Agreement between People's Bankcorp, Inc.
and Robert E. Wilson
* 10.5 Employment Agreement between Ogdensburg Federal
Savings and Loan Association and Todd R. Mashaw
* 10.6 Grantor Trust Agreement
* 23.1 Consent of Housley Kantarian & Bronstein, P.C. (in
opinions filed as Exhibits 5 and 8.1)
* 23.2 Consent of KPMG Peat Marwick LLP
* 23.3 Consent of Feldman Financial Advisors
* 24 Power of Attorney (reference is made to the
signature page of the Form SB-2)
* 27 Financial Data Schedule
* 99.1 Proposed Stock Order Form and Form of
Certification
* 99.2 Proxy Statement for Special Meeting of Members of
Ogdensburg Federal Savings and Loan Association;
Form of Proxy
* 99.3 Form of Miscellaneous Solicitation and
Marketing Materials
* 99.4 Appraisal Report
__________________
* Previously filed.
(b) FINANCIAL STATEMENT SCHEDULES.
No financial statement schedules are filed because the
required information is not applicable or is included in the
consolidated financial statements or related notes.
ITEM 17. UNDERTAKINGS
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales
are being made, a post-effective amendment to this registration
statement:
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(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or
events arising after the effective date of the
registration statement (or the most recent post-effective
amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the
information set forth in the registration statement;
(iii) To include any additional or changed material
information on the plan of distribution.
(2) That, for the purpose of determining any liability
under the Securities Act of 1933, each post-effective amendment
shall be deemed to be a new registration statement of the
securities offered, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering
thereof.
(3) To file a post-effective amendment or remove from
registration any of the securities that remain unsold at the end
of the offering.
Insofar as indemnification for liabilities arising under
the Securities Act of 1933 (the "Act") may be permitted to
directors, officers and controlling persons of the registrant
pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is
against public policy as expressed in the Act, and is therefore,
unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer
or controlling person of the registrant in the successful
defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the
securities being registered, the registrant will, unless in the
opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate
jurisdiction the questions whether such indemnification by it is
against public policy as expressed in the Act and will be
governed by the final adjudication of such issue.
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SIGNATURES
In accordance with the requirements of the Securities Act
of 1933, the registrant certifies that it has reasonable grounds
to believe that it meets all of the requirements for filing on
Form SB-2 and authorized this amended registration statement to
be signed on its behalf by the undersigned, in the City of
Ogdensburg, State of New York, on November 11, 1998.
PEOPLES BANKCORP, INC.
By: /s/ Robert E. Wilson
------------------------------
Robert E. Wilson
President and Chief Executive
Officer
(Duly Authorized Representative)
In accordance with the requirements of the Securities Act
of 1933, this amended registration statement has been signed by
the following persons in the capacities and on the dates stated.
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Signatures Title Date
<S> <C> <C>
/s/ Robert E. Wilson President, Chief Executive November 11, 1998
- ----------------------------- Officer and Director
Robert E. Wilson (Principal Executive,
Accounting and Financial
Officer)
* /s/ Robert E. Hentschel Chairman of the Board
- -----------------------------
Robert E. Hentschel
* /s/ Anthony P. LeBarge, Sr. Director
- -----------------------------
Anthony P. LeBarge, Sr.
* /s/ Wesley L. Stitt Director
- -----------------------------
Wesley L. Stitt
* /s/ George E. Silver Director
- -----------------------------
George E. Silver
* By: /s/ Robert E. Wilson November 11, 1998
------------------------
Robert E. Wilson
Attorney-in-Fact
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[LETTERHEAD OF HOUSLEY KANTARIAN & BRONSTEIN, P.C.]
November 10, 1998
Board of Directors
Ogdensburg Federal Savings and
Loan Association
825 State Street
Ogdensburg, New York 13669
Re: Federal Income Tax Consequences Relating to Proposed
Holding Company Conversion
----------------------------------------------------
Gentlemen:
In accordance with your request, set forth hereinbelow is
the opinion of this firm relating to the material federal income
tax consequences of the proposed conversion of Ogdensburg
Federal Savings and Loan Association (the "Association") from a
federally chartered mutual savings association to a federally
chartered capital stock saving association with the name
"Ogdensburg Federal Savings and Loan Association" (the
"Converted Association") and the concurrent acquisition of 100%
of the outstanding capital stock of the Converted Association by
Peoples Bankcorp, Inc. (the "Company"), a New York corporation
formed at the direction of the Board of Directors of the
Association to become the parent holding company of the
Converted Association (the "Conversion").
For purposes of this opinion, we have examined such
documents and questions of law as we have considered necessary
or appropriate, including but not limited to the Plan of
Conversion as adopted on July 23, 1998 by the Board of Directors
of the Association (the "Plan"); the federal mutual charter and
bylaws of the Association, as amended; the federal stock charter
and bylaws of the Converted Association; the certificate of
incorporation and bylaws of the Company; the Affidavit of
Representations dated November 10,1998 provided to us by the
Association (the "Affidavit"), and the Prospectus (the
"Prospectus") included in the Company's Registration Statement
on Form SB-2, as amended, filed with the Securities and Exchange
Commission ("SEC") in connection with the Conversion (the
"Registration Statement"). In such examination, we have
assumed, and have not independently verified, the genuineness of
all signatures on original documents where due execution and
delivery are requirements to the effectiveness thereof.
<PAGE>
Board of Directors
Ogdensburg Federal Savings
and Loan Association
November 10, 1998
Page 2
Terms used but not defined herein, whether capitalized or not,
shall have the same meaning as defined in the Plan.
BACKGROUND
----------
Based solely upon our review of such documents, and upon
such information as the Association has provided to us (which we
have not attempted to verify in any respect), and in reliance
upon such documents and information, we set forth hereinbelow a
general summary of the relevant facts and proposed transaction,
qualified in its entirety by reference to the documents cited
above.
The Association is a federally chartered mutual savings
association, which is in the process of converting to a
federally chartered capital stock savings association. The
Association was organized as a federally chartered mutual
savings institution in 1982 having originally been chartered as
a state chartered savings and loan association.
The Association is a member of the FHLB System, and the
deposits of the Association are insured by the Federal Deposit
Insurance Corporation ("FDIC") up to applicable limits. The
Association is subject to comprehensive regulation and
supervision by the Office of Thrift Supervision ("OTS") and to
examination by the OTS. The Association operates one office in
St. Lawrence County, New York.
The Association's principal business consists of
attracting deposits, primarily certificates of deposit, from the
general public and originating residential mortgage loans on
one- to four-family properties. The Association also offers
consumer loans and certain other types of loans. At June 30,
1998, the Association had total assets of $24.2 million,
deposits of $22.4 million and equity of $1.6 million.
As a federally chartered mutual savings association, the
Association has no authorized capital stock. Instead, the
Association, in mutual form, has a unique equity structure. A
savings depositor of the Association is entitled to payment of
interest on his account balance as declared and paid by the
Association, but has no right to a distribution of any earnings
of the Association except for interest paid on his deposit.
Rather, such earnings become retained income of the Association.
However, a savings depositor does have a right to share
pro rata, with respect to the withdrawal value of his respective
savings account, in any liquidation proceeds distributed if the
Association is ever liquidated. Further, savings depositors and
borrowers are members of the Association and thereby have voting
rights in the Association. Under the Association's federal
mutual charter, each depositor is entitled to cast one vote for
each $100 or fraction thereof held in a withdrawable deposit
account of the Association, and each borrower member
(hereinafter
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Board of Directors
Ogdensburg Federal Savings
and Loan Association
November 10, 1998
Page 3
"borrower") is entitled to one vote in addition to the votes
(if any) to which such person is entitled in such borrower's
capacity as a savings depositor of the Association. All of the
interests held by a savings depositor in the Association cease
when such depositor closes his accounts with the Association.
The Company was incorporated on September 17, 1998 under
the laws of the State of New York to act as the savings and loan
holding company of the Converted Association upon consummation
of the Conversion. Prior to consummation of the Conversion, the
Company has not been engaged in and is not expected to engage in
any material operations. After the Conversion, the Company's
principal business will be overseeing the business of the
Converted Association. The Company has authorized capital stock
of 3,000,000 shares of common stock (the "Common Stock"), par
value $.01 per share, and 500,000 shares of serial preferred
stock, par value $.01 per share.
PROPOSED TRANSACTION
--------------------
The Board of Directors of the Association has decided that
in order to attract new capital to the Converted Association to
increase its net worth, to support future savings growth, to
increase the amount of funds available for lending and
investment, to provide greater resources for the expansion of
customer services, and to facilitate future expansion, it would
be advantageous for the Association to convert from a federally
chartered mutual savings association to a federally chartered
capital stock savings association. In addition, the Board of
Directors intends to implement stock option plans and other
stock benefit plans following the Conversion in order to better
attract and retain qualified directors and officers. It is the
further desire of the Board of Directors to reorganize the
Converted Association as the wholly owned subsidiary of the
Company to enhance flexibility of operations, diversification of
business opportunities and financial capability for business and
regulatory purposes and to enable the Converted Association to
compete more effectively with other financial service
organizations.
Accordingly, pursuant to the Plan, the Association will
undergo the Conversion whereby it will be converted from a
federally chartered mutual savings association to a federally
chartered capital stock savings association. The Converted
Association will then issue to the Company 100,000 shares of the
Converted Association's common stock, representing all of the
shares of capital stock to be issued by the Converted
Association in the Conversion, and the Company will make payment
to the Converted Association in an amount equal to at least 50%
of the aggregate net proceeds realized by the Company from the
sale of its Common Stock sold pursuant to the Plan, after
deducting the amount necessary to fund a loan to an Employee
Stock Ownership Plan being established in connection with the
Conversion, or such other portion of the aggregate net proceeds
as may be authorized or required by the OTS. Pursuant to the
Prospectus, the Company currently anticipates making such
payment to the Converted Association of an amount equal to 50%
of the aggregate net proceeds from the sale of the Common Stock.
<PAGE>
<PAGE>
Board of Directors
Ogdensburg Federal Savings
and Loan Association
November 10, 1998
Page 4
Also pursuant to the Plan, the Company will offer its
shares of Common Stock for sale in a Subscription Offering.
Shares of Common Stock remaining, if any, may then be offered to
the general public in a Community Offering. Shares of the
Common Stock not otherwise subscribed for in the Subscription
Offering and Community Offering may be offered at the discretion
of the Company to certain members of the general public as part
of a community offering on a best efforts basis by a selling
group of selected broker-dealers.
The purchase price per share and total number of shares of
Common Stock to be offered and sold pursuant to the Plan will be
determined by the Boards of Directors of the Association and the
Company, on the basis of the estimated pro forma market value of
the Converted Association, as a subsidiary of the Company, which
will in turn be determined by an independent appraiser. The
aggregate purchase price for all shares of the Common Stock will
be equal to such estimated pro forma market value. Pursuant to
the Plan, all such shares of Common Stock will be issued and
sold at a uniform price per share. The Conversion, including
the sale of newly issued shares of the stock of the Converted
Association to the Company, will be deemed effective
concurrently with the closing of the sale of the Common Stock.
Under the Plan and in accordance with regulations of the
OTS, the shares of Common Stock will first be offered through
the Subscription Offering pursuant to non-transferable
subscription rights on the basis of preference categories in the
following order of priority:
(1) Eligible Account Holders;
(2) Tax-Qualified Employee Stock Benefit Plans (i.e. the
ESOP);
(3) Supplemental Eligible Account Holders; and
(4) Other Members.
However, any shares of Common Stock sold in excess of the
high-end of the Valuation Range may first be sold to
Tax-Qualified Employee Stock Benefit Plans set forth in category
(2) above.
Any shares of Common Stock not subscribed for in the
Subscription Offering will be offered in the Community Offering
in the following order of priority:
(a) Natural persons and trusts of natural persons
(including individual retirement and Keogh
retirement accounts and personal trusts in which
such natural persons have substantial interests) who
are permanent Residents of the Association's Local
Community, St. Lawrence County, New York; and
<PAGE>
<PAGE>
Board of Directors
Ogdensburg Federal Savings
and Loan Association
November 10, 1998
Page 5
(b) The general public.
Shares not sold in the Subscription Offering and the
Community Offering, if any, may thereafter be offered for sale
to certain members of the general public as part of a community
offering on a best efforts basis by a selling group of selected
broker-dealers. The sale of shares in the Subscription Offering,
Community Offering, and as sold through the selected
broker-dealers would be consummated at the same time.
The Plan also provides for the establishment of a
Liquidation Account by the Converted Association for the benefit
of all Eligible Account Holders and Supplemental Eligible
Account Holders in an amount equal to the regulatory capital of
the Association as of the date of the latest statement of
financial condition contained in the final prospectus issued in
connection with the Conversion. The establishment of the
Liquidation Account will not operate to restrict the use or
application of any of the net worth accounts of the Converted
Association, except that the Converted Association may not
declare or pay cash dividends on or repurchase any of its stock
if the result thereof would be to reduce its regulatory capital
below the amount required to maintain the Liquidation Account.
All such account holders will have an inchoate interest in a
proportionate amount of the Liquidation Account with respect to
each savings account held and will be paid by the Converted
Association in event of liquidation prior to any liquidating
distribution being made with respect to capital stock. Under
the Plan, the Conversion shall not be deemed to be a liquidation
of the Association for purposes of distribution of the
Liquidation Account. Instead, upon consummation of the
Conversion, the Liquidation Account, together with the related
rights and obligations of the Converted Association, shall be
assumed by the Converted Association.
The Conversion will not interrupt the business of the
Association. The Converted Association will, after the
Conversion, engage in the same business as that of the
Association immediately prior to the Conversion, and will
continue to be subject to regulation and supervision by the OTS.
Further, the deposits of the Converted Association will continue
to be insured by the FDIC. Each depositor will retain a
withdrawable savings account or accounts equal in dollar amount
to, and on the same terms and conditions as, the withdrawable
account or accounts at the time of Conversion except to the
extent funds on deposit are used to pay for Common Stock
purchased in connection with the Conversion. All loans of the
Association will remain unchanged and retain their same
characteristics in the Converted Association immediately
following the Conversion.
Following the Conversion, voting rights in the Converted
Association will rest exclusively with the sole holder of stock
in the Converted Association, which will be the Company. Voting
rights in the Company will rest exclusively in the holders of
the Common Stock.
<PAGE>
<PAGE>
Board of Directors
Ogdensburg Federal Savings
and Loan Association
November 10, 1998
Page 6
The Plan must be approved by the OTS and by an affirmative
vote of at least a majority of the total votes eligible to be
cast at a meeting of the Association's members called to vote on
the Plan. Immediately prior to the Conversion, the Association
will have a positive net worth determined in accordance with
generally accepted accounting principles.
OPINION
-------
Based on the foregoing and in reliance thereon, and
subject to the conditions stated herein, it is our opinion that
the following federal income tax consequences will result from
the proposed transaction.
1. The Conversion will constitute a reorganization
within the meaning of Section 368(a)(1)(F) of the
Internal Revenue Code of 1986, as amended (the
"Code"), and no gain or loss will be recognized to
either the Association or the Converted Association
as a result of the Conversion (see Rev. Rul. 80-105,
1980-1 C.B. 78).
2. The assets of the Association will have the same
basis in the hands of the Converted Association as
in the hands of the Association immediately prior to
the Conversion (Section 362(b) of the Code).
3. The holding period of the assets of the Association
to be received by the Converted Association will
include the period during which the assets were held
by the Association prior to the Conversion (Section
1223(2) of the Code).
4. No gain or loss will be recognized by the Converted
Association upon its receipt of money from the
Company in exchange for shares of common stock of
the Converted Association (Section 1032(a) of the
Code). The Company will be transferring solely cash
to the Converted Association in exchange for all the
outstanding capital stock of the Converted
Association and therefore will not recognize any
gain or loss upon such transfer. (Section 351(a) of
the Code; see Rev. Rul. 69-357, 1969-1 C.B. 101).
5. No gain or loss will be recognized by the Company
upon its receipt of money in exchange for shares of
the Common Stock (Section 1032(a) of the Code).
6. No gain or loss will be recognized by the Eligible
Account Holders, Supplemental Eligible Account
Holders, or Other Members of the Association upon
the issuance to them of deposit accounts in the
Converted Association in the same dollar amount and
on the same terms and conditions in exchange for
their deposit accounts in the Association held
immediately prior to the Conversion. (Section
1001(a) of the Code; Treas. Reg. Subsection
1.1001-1(a)).
<PAGE>
<PAGE>
Board of Directors
Ogdensburg Federal Savings
and Loan Association
November 10, 1998
Page 7
7. The tax basis of the savings accounts of the
Eligible Account Holders, Supplemental Eligible
Account Holders, and Other Members in the Converted
Association received as part of the Conversion will
equal the tax basis of such account holders'
corresponding deposit accounts in the Association
surrendered in exchange therefor (Section 1012 of
the Code).
8. Each depositor of the Association will recognize
gain upon the receipt of his or her respective
interest in the Liquidation Account established by
the Converted Association pursuant to the Plan and
the receipt of his or her subscription rights deemed
to have been received for federal income tax
purposes, but only to the extent of the excess of
the combined fair market value of a depositor's
interest in such Liquidation Account and
subscription rights over the depositor's basis in
the former interests in the Association other than
deposit accounts. Persons who subscribe in the
Conversion but who are not depositors of the
Association will recognize gain upon the receipt of
subscription rights deemed to have been received for
federal income tax purposes, but only to the extent
of the excess of the fair market value of such
subscription rights over such person's former
interests in the Association, if any. Any such gain
realized in the Conversion would be subject to
immediate recognition.
9. The basis of each account holder's interest in the
Liquidation Account received in the Conversion and
to be established by the Converted Association
pursuant to the Conversion will be equal to the
value, if any, of that interest.
10. No gain or loss will be recognized upon the exercise
of a subscription right in the Conversion. (Rev.
Rul. 56-572, 1956-2 C.B.182).
11. The basis of the shares of Common Stock acquired in
the Conversion will be equal to the purchase price
of such shares, increased, in the case of such
shares acquired pursuant to the exercise of
subscription rights, by the fair market value, if
any, of the subscription rights exercised (Section
1012 of the Code).
12. The holding period of the Common Stock acquired in
the Conversion pursuant to the exercise of
subscription rights will commence on the date on
which the subscription rights are exercised (Section
1223(6) of the Code). The holding period of the
Common Stock acquired in the Community Offering will
commence on the date following the date on which
such stock is purchased (Rev. Rul. 70-598, 1970-2
C.B. 168; Rev. Rul. 66-97, 1966-1 C.B. 190).
<PAGE>
<PAGE>
Board of Directors
Ogdensburg Federal Savings
and Loan Association
November 10, 1998
Page 8
SCOPE OF OPINION
----------------
Our opinion is limited to the federal income tax matters
described above and does not address any other federal income
tax considerations or any state, local, foreign or other federal
tax considerations. If any of the information upon which we
have relied is incorrect, or if changes in the relevant facts
occur after the date hereof, our opinion could be affected
thereby. Moreover, our opinion is based on the case law, Code,
Treasury Regulations thereunder and Internal Revenue Service
rulings as they now exist. These authorities are all subject to
change, and such change may be made with retroactive effect. We
can give no assurance that, after such change, our opinion would
not be different. We undertake no responsibility to update or
supplement our opinion subsequent to consummation of the
Conversion. Prior to that time, we undertake to update or
supplement our opinion in the event of a material change in the
federal income tax consequences set forth above and to file such
revised opinion as an exhibit to the Registration Statement and
the Association's Application for Conversion on Form AC ("Form
AC"). This opinion is not binding on the Internal Revenue
Service and there can be no assurance, and none is hereby given,
that the Internal Revenue Service will not take a position
contrary to one or more of the positions reflected in the
foregoing opinion, or that our opinion will be upheld by the
courts if challenged by the Internal Revenue Service.
CONSENTS
--------
We hereby consent to the filing of this opinion with the
OTS as an exhibit to the Application H-(e)1-S filed by the
Company with the OTS in connection with the Conversion and the
reference to our firm in the Application H-(e)1-S under Item
110.55 therein.
We also hereby consent to the filing of this opinion with
the SEC and the OTS as exhibits to the Registration Statement
and Form AC, respectively, and the references to our firm in the
Prospectus, which is a part of the Registration Statement and
Form AC, under the headings "The Conversion -- Effect of
Conversion to Stock Form on Depositors and Borrowers of
Ogdensburg Federal Savings and Loan Association -- Tax Effects"
and "Legal and Tax Matters."
Very truly yours,
HOUSLEY KANTARIAN & BRONSTEIN, P.C.
By: /s/ Gary R. Bronstein
----------------------------
Gary R. Bronstein
<PAGE>
[Silver and Silver Letterhead]
November 11, 1998
Board of Directors
Ogdensburg Federal Savings & Loan Association
825 State Street
Ogdensburg, New York 13669
Board Members:
You have requested the opinion of Silver and Silver as
to the New York State franchise and New York State personal
income tax consequences relating to the proposed conversion of
Ogdensburg Federal Savings and Loan Association from a federally
chartered mutual savings and loan association to a federally
chartered stock savings and loan association (the "Stock
Association") and the formation of Peoples Bankcorp, Inc. which
will acquire all of the outstanding stock of the Stock
Association.
You have submitted to us a copy of the federal income tax
opinion ("Federal Opinion") relating to the federal income tax
consequences of the proposed transaction prepared by your
counsel, Housley Kantarian & Bronstein, P.C. and dated November
10, 1998.
Our opinion regarding the New York State franchise and New
York State personal income tax consequences of the proposed
transaction is based on the same facts, assumptions and
conditions contained in the Federal Opinion. It is also based
on existing New York Tax Law which is subject to change. We
have not reviewed the legal documents necessary to effectuate
the steps to be undertaken, and we assume that all steps will
be properly effectuated under state and federal law and will be
consistent with the legal documentation.
In our opinion, the New York State franchise and New York
State personal income tax consequences of the proposed
transaction are consistent with the federal income tax
consequences of the proposed transaction opined upon in the
Federal Opinion.
For purposes of the franchise tax the State of New York
has adopted federal taxable income (Internal Revenue Code Sec.
63), as currently amended, as the starting point for computing
New York entire net income (NYS Tax Law Sec. 1453). Franchise
tax terms are defined in relation to the Internal Revenue Code
of 1986, as amended. Taxpayers are required to use federal
taxable income as the starting point for the computation of
entire net income.
<PAGE>
<PAGE>
Page 2 November 11, 1998
To: Board of Directors
Ogdendsburg Federal Savings and Loan Association
Several specific modifications to federal taxable income
are enumerated in the New York Tax Law and the Banking
Corporation Regulations in determining income taxable for New
York State franchise tax purposes, however there are no specific
modifications which apply to the proposed transaction (see New
York State Tax Law Article 32, Sections 1453 (b) through (m) and
Regulation Sections 18-2.3, 18-2.4 and 18-2.5 of the Franchise
Tax on Banking Corporations).
The State of New York has adopted federal adjusted gross
income (IRC Sec. 62), as currently amended, as the starting
point for computing New York taxable income (NYS Tax Law Sec.
612) for personal income tax purposes. Income tax terms are
defined in relation to the Internal Revenue Code of 1986, as
amended.
Several specific modifications to federal taxable income
are enumerated in the New York Statutes in determining income
taxable for New York State personal income tax purposes, however
there are no specific modifications which apply to the proposed
transaction (see New York State Tax Law Article 22, Sections 612
(b) through (t) and Regulation Sections 112.2 through 112.13 of
the Personal Income Tax).
Our opinion as expressed above is rendered only with
respect to the New York franchise and New York State personal
income tax consequences of specific matters discussed herein,
and we express no opinion with respect to any other New York
franchise, income or transfer tax matter or any other federal,
state, local or foreign tax matter relating to the proposed
transaction. Our opinion is based on the facts and conditions
as stated herein, whether directly or by reference to the
Federal Opinion. It is expressly understood and agreed to by
Ogdensburg Federal Savings and Loan Association, the Stock
Association, and Peoples Bankcorp, Inc. that Silver and Silver
is relying solely on the Federal Opinion in all respects
relating to the federal tax consequences of the matters
described herein. Silver and Silver has not independently
verified the accuracy of any fact, representation, opinion or
other matter contained in the Federal Tax Opinion and should any
fact, representation, opinion or other matter addressed therein
not be correct, it could cause the New York State franchise and
income tax opinion contained herein to also be incorrect. If
any of the facts and conditions are not entirely complete or
accurate, it is imperative that we be informed immediately, as
the inaccuracy or incompleteness could have a material effect on
our conclusions. In rendering our opinion, we are relying upon
the relevant provisions of the Internal Revenue Code of 1986,
as amended, and New York Statutes, as amended, the regulations
and rules thereunder and judicial and administrative
interpretations thereof, which are subject to change or
modification by subsequent legislative, regulatory,
administrative, or judicial decisions. Any such changes could
also have an effect on the validity of our opinion. We
undertake no responsibility to update or supplement our opinion
after its issuance. This opinion is not binding upon any tax
authority or any court and no assurance can be given that a
position contrary to that expressed herein will not be asserted
by a tax authority and ultimately sustained by a court.
<PAGE>
<PAGE>
Page 3 November 11, 1998
To: Board of Directors
Ogdendsburg Federal Savings and Loan Association
We hereby consent to the filing of this opinion with the
OTS as an exhibit to the Application H-(e)1-S filed by the
Company with the OTS in connection with the Conversion
and the reference to our firm in the Application H-(e)1-S under
Item 110.55 therein.
We also hereby consent to the filing of this opinion with
the SEC and the OTS as exhibits to the Registration Statement
and Form AC, respectively, and the references to our firm in the
Prospectus, which is a part of the Registration Statement and
Form AC, under the headings "The Conversion -- Effect of
Conversion to Stock Form on Depositors and Borrowers of
Ogdensburg Federal Savings and Loan Association -- Tax Effects"
and "Legal and Tax Matters."
Very truly yours,
SILVER AND SILVER
/s/ George E. Silver
--------------------------------
George E. Silver
