As filed with the Securities and Exchange Commission on July 30, 1999
Registration Nos. 333-81251
333-81251-01
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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PRE-EFFECTIVE AMENDMENT NO. 1 TO THE
FORM S-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
PEOPLES BANCORP INC. PEBO CAPITAL TRUST I
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(Exact name of Registrant as (Exact name of Registrant
specified in its charter) as specified in its trust agreement)
Ohio
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(State or other jurisdiction of incorporation or organization)
Delaware
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(State or other jurisdiction of incorporation or organization)
522110
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(Primary North American Industry Classification System Number)
525920
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(Primary North American Industry Classification System Number)
31-0987416 51-5612405
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(I.R.S. Employer Identification No.) (I.R.S. Employer Identification No.)
138 Putnam Street, Marietta, Ohio 45750
(740) 373-3155
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(Address, including zip code, and telephone number, including area
code, of Registrants' principal executive offices)
Charles R. Hunsaker, Esq., General Counsel COPY TO:
Peoples Bancorp Inc. Elizabeth Turrell Farrar, Esq.
138 Putnam Street, Marietta, Ohio 45750 Vorys, Sater, Seymour and Pease LLP
(740) 374-6109 52 East Gay Street, P.O. Box 1008
- ------------------------------------------- Columbus, Ohio 43216-1008
(Name, address, including zip code, and
telephone number, including area code, of
agent for service)
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE OF THE SECURITIES TO THE
PUBLIC: As soon as practicable after this Registration Statement becomes
effective.
If the securities being registered on this Form are being offered in connection
with the formation of a holding company and there is compliance with General
Instruction G, check the following box. [ ]
If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) 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. [ ]
The Registrants hereby amend this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Registrants 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 Commission, acting pursuant to said Section 8(a),
may determine.
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PEBO Capital Trust I
and
Peoples Bancorp Inc.
Offer to Exchange
-------------------------------------
o Up to $30,000,000 aggregate A similar amount of PEBO Capital
liquidation amount of PEBO Capital Trust I's outstanding Series A
Trust I's Series B 8.62% Capital 8.62% Capital Securities, which
Securities, which have been For have not been registered under
registered under the Securities the Securities Act of 1933
Act of 1933
o Peoples Bancorp Inc.'s guarantee Its similar guarantee of PEBO
of PEBO Capital Trust I's obligations Capital Trust I's obligations
under the new capital securities, under the original capital
which has been registered under For securities, which has not been
the Securities Act of 1933 registered under the Securities
Act of 1933
o Up to $30,000,000 of Peoples A similar amount of Peoples
Bancorp Inc.'s Series B 8.62% Bancorp Inc.'s Series A 8.62%
Junior Subordinated Deferrable Junior Subordinated Deferrable
Interest Debentures due May 1, For Interest Debentures due May 1,
2029, which have been registered 2029, which have not been
under the Securities Act of 1933 registered under the Securities
Act of 1933
-------------------------------------
The new capital securities and the original capital securities are
identical except that the original capital securities contained transfer
restrictions, registration rights and potential increases in the distribution
rate that the new capital securities do not contain. The original capital
securities trade and the new capital securities are expected to trade in the
Private Offerings, Resales, and Trading through Automatic Linkages market.
The new debentures and the original debentures are identical except
that the original debentures contained liquidated damages rights that the new
debentures do not contain.
The exchange offer and withdrawal rights will expire at 5:00 p.m., New
York City time, on ___________, 1999, unless extended.
You should carefully consider the "Risk factors" beginning on page __
before deciding whether to exchange your original capital securities for new
capital securities.
These securities are not deposits or other obligations of a bank and
are not insured by the Federal Deposit Insurance Corporation or any other
governmental agency.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
The date of this prospectus is _________________, 1999.
Summary
This summary provides an overview of selected information contained
elsewhere in this prospectus and does not contain all the information you should
consider. Therefore, you should also read the more detailed information
appearing elsewhere in this prospectus.
Peoples Bancorp Inc.
Peoples was organized in 1980 as a bank holding company.
Peoples' banking subsidiaries operate 35 sales offices in the states of
Ohio, West Virginia and Kentucky. The following table presents selected
financial information at and for the quarter ended March 31, 1999 and the year
ended December 31, 1998:
At or for the quarter At or for the year ended
ended March 31, 1999 December 31, 1998
--------------------- ------------------------
(Dollars in Millions)
Total assets $871.9 $880.3
Total loans 574.6 567.9
Total deposits 707.0 714.2
Total stockholders' equity 86.8 86.0
Return on average assets 1.21% 1.20%
Return on average 12.12% 12.21%
stockholders' equity
At March 31, 1999, Peoples and its subsidiaries had 356 full-time
equivalent employees. The principal executive office of Peoples is located at
138 Putnam Street, Marietta, Ohio 45750. The telephone number is (740) 373-3155.
PEBO Capital Trust I
PEBO Capital Trust I is a Delaware statutory business trust. Its
business and affairs are conducted by Wilmington Trust Company, as property
trustee and Delaware trustee, and three individual administrative trustees, who
are officers of Peoples. PEBO Capital Trust I exists exclusively to issue and
sell its securities, use the proceeds from the sale of its securities to acquire
debentures issued by Peoples and engage in other incidental activities.
The debentures issued by Peoples are the sole assets of PEBO Capital
Trust I. Payments under those debentures are the sole revenues of PEBO Capital
Trust I. All of the common securities issued by PEBO Capital Trust I are owned
by Peoples. The principal executive office of PEBO Capital Trust I is c/o
Peoples Bancorp Inc., 138 Putnam Street, Marietta, Ohio 45750, Attention:
Charles R. Hunsaker, Administrative Trustee.
The Exchange Offer
The exchange offer.......................... We are offering to exchange:
o........Up to $30,000,000
aggregate liquidation amount
of capital securities, which
have been registered under
the Securities Act, for a
like aggregate liquidation
amount of capital securities,
which were issued without
registration. You may
exchange any or all of your
original capital securities
as long as the original
capital securities you
exchange, as well as the
original capital securities
you retain, have a
liquidation amount of at
least $100,000 or an integral
multiple of $1,000 in excess
of $100,000.
o........Peoples' guarantee of
PEBO Capital Trust I's
obligations under the new
capital securities, which has
been registered under the
Securities Act, for Peoples'
similar guarantee of PEBO
Capital Trust I's obligations
under the original capital
securities, which has not
been registered.
o........Up to $30,000,000 of
Peoples' new debentures,
which have been registered
under the Securities Act, for
a similar amount of Peoples'
original debentures, which
have not been registered.
Expiration date............................. This exchange offer will expire at
5:00 p.m., New York City time,
on _____________, 1999. If we
choose to extend the exchange
offer, the expiration date will
be the latest date and time to
which it is extended.
Procedures for exchanging original capital
securities.................................. If you want to accept the
exchange offer, you must complete,
sign, date and deliver the
accompanying letter of
transmittal, together with the
original capital securities and
any other required documentation,
to the exchange agent before the
expiration date. The letter of
transmittal includes detailed
instructions for its completion,
execution and delivery which must
be followed meticulously.
Special procedures for beneficial owners.... If your original capital
securities are registered in the
name of a broker, dealer,
commercial bank, trust company
or other nominee, you should
contact the registered owner
promptly and instruct it to
exchange original capital
securities on your behalf.
Guaranteed delivery procedures.............. If you cannot deliver the
original capital securities,
the letter of transmittal or
any other documents required
by the letter of transmittal
to the exchange agent prior to
the expiration date, and you
cannot comply with the procedures
for book-entry transfer, you
must follow the guaranteed
delivery procedures.
Withdrawal rights........................... Original capital securities
delivered for exchange may be
withdrawn at any time prior to
5:00 p.m., New York City time,
on the expiration date.
Acceptance of original capital securities
and delivery of new capital securities...... We will accept for exchange any
original capital securities
that are properly tendered prior
to 5:00 p.m., New York City
time, on the expiration date.
We will exchange, and issue to
the exchange agent, new capital
securities promptly after the
expiration date.
Consequences of failure to exchange......... If you are eligible to participate
in the exchange offer but do not
exchange your original capital
securities, you will not have any
exchange rights following the
closing of this exchange offer.
Your original capital securities
will remain restricted securities
and may be resold only:
o........to Peoples;
o........to a qualified
institutional buyer under
Rule 144A under the
Securities Act;
o........to an institutional
accredited investor;
o........in a transaction
otherwise exempt from
registration under the
Securities Act; or
o........pursuant to an effective
registration statement
under the Securities Act.
Resale of the capital securities............ Based on interpretations by the
staff of the SEC in no-action
letters to third parties, we
believe that the new capital
securities to be issued in
exchange for original capital
securities may be offered for
resale and may be resold or
otherwise transferred without
restriction, except as follows:
o........A broker-dealer who
purchased original capital
securities for resale under
Rule 144A or another
exemption under the
Securities Act may not tender
original capital securities
for exchange and must comply
with the registration and
prospectus delivery
provisions of the Securities
Act; and
o........A person that is an
"affiliate" of Peoples or
PEBO Capital Trust I, within
the meaning of Rule 405 under
the Securities Act, may not
tender original capital
securities for exchange and
must comply with the
registration and prospectus
delivery provisions of the
Securities Act unless the
affiliate sells the original
capital securities under Rule
144 or another exemption
under the Securities Act.
If a broker-dealer or affiliate
transfers capital securities in
violation of the prospectus
delivery requirements of the
Securities Act or without an
exemption from registration, it
may incur liability under the
Securities Act. We do not
indemnify holders of capital
securities against liability under
the Securities Act. Broker-dealers
that receive new capital
securities for their own accounts
in exchange for original capital
securities should refer to the
applicable provisions described in
the section entitled "Plan of
distribution."
All resales of capital securities
must be made in compliance with
applicable state securities or
"blue sky" laws. We assume no
responsibility for your compliance
with these requirements. We are
not making the exchange offer to,
and will not accept surrenders for
exchange from, holders of original
capital securities in any
jurisdiction in which the exchange
offer or the acceptance of the
exchange offer would not be in
compliance with the applicable
securities or "blue sky" laws.
Conditions to the exchange offer............ If we determine that applicable
federal laws or the SEC staff's
interpretations do not permit the
exchange offer, we may terminate
the exchange offer.
............................................ The exchange offer is not
conditioned upon the tender of any
minimum liquidation amount of
original capital securities.
............................................ To accept the exchange offer, you
must represent to us in writing
that:
o........You are not an affiliate
of Peoples or PEBO Capital
Trust I;
o........You are acquiring the new
capital securities in the
ordinary course of your
business; and
o........You are not participating
in, and have no arrangement
or understanding with any
person to participate in, the
distribution of the new
capital securities.
Federal income tax consequences............. The exchange of original capital
securities for new capital
securities will generally not be
a taxable event for U.S. federal
income tax purposes.
Exchange agent.............................. Wilmington Trust Company
RISK FACTORS
You should carefully read the following risk factors and the other
sections of this prospectus in deciding whether to exchange your original
securities for new securities. You should consider all of these risk factors to
be important. The risk factors below do not necessarily appear in their order of
importance. Except where otherwise indicated, the following risk factors apply
to both original capital securities and new capital securities.
Peoples' obligations under the guarantee issued for the benefit of holders of
capital securities and under the debentures rank lower in priority to other
obligations of Peoples.
Peoples' obligations under the guarantee issued for the benefit of the
holders of the capital securities, as well as its obligations under the
debentures issued to PEBO Capital Trust I, are unsecured and will rank junior in
right of payment to Peoples' senior indebtedness. As of March 31, 1999, Peoples,
as part of its senior indebtedness, had a note to a regional bank in the amount
of $2.6 million. Peoples' obligations will also rank junior in right of payment
to all existing and future liabilities and obligations of Peoples' subsidiaries,
including liabilities and obligations to depositors of its banking subsidiaries.
The capital securities, the debentures and the guarantee do not limit
the ability of Peoples or any of its subsidiaries to incur additional debt,
including debt that may rank senior to the debentures and the guarantee.
For more information on Peoples' obligations under the guarantee and
the debentures, see "Description of debentures--Subordination" and "Description
of guarantee by Peoples."
If Peoples does not make payments under the debentures, PEBO Capital Trust I
will be unable to pay distributions and liquidation amounts on the capital
securities and Peoples' guarantee will not apply.
The ability of PEBO Capital Trust I to pay cash distributions to you
and the liquidation amount of $1,000 per capital security is solely dependent on
the ability of Peoples to make the related payments on the debentures issued to
PEBO Capital Trust I, when due.
If Peoples defaults on its obligations to pay principal of, or interest
on, the debentures, PEBO Capital Trust I will not have sufficient funds to pay
distributions or the liquidation amount per capital security. As a result, you
will not be able to rely on Peoples' guarantee for payment of these amounts.
Instead you may directly sue Peoples or seek other remedies to collect your pro
rata share of payments owed or rely on the property trustee of PEBO Capital
Trust I to enforce PEBO Capital Trust I's rights under the debentures.
For more information on Peoples' obligations under the guarantee and
the debentures, see "Description of guarantee by Peoples" and "Description of
debentures--Subordination."
Interest payments by Peoples on the debentures are dependent upon the receipt of
cash dividends from its banking subsidiaries.
Almost all of Peoples' assets consist of its investments in its banking
subsidiaries. Thus, Peoples' ability to pay principal of, and interest on, the
debentures depends primarily upon cash dividends received by Peoples from its
banking subsidiaries. Dividend payments by the banking subsidiaries to Peoples
are subject to, among other things:
o Regulatory limitations -- generally based on current and retained
earnings and capital adequacy requirements imposed by various
regulatory agencies;
o Profitability, financial condition, capital expenditures and other cash
flow requirements of the banking subsidiaries; and
o Prior claims of creditors of the banking subsidiaries.
If Peoples does not receive sufficient cash dividends from its banking
subsidiaries, then it is unlikely that Peoples will have sufficient funds to
make payments on the debentures. PEBO Capital Trust I would then have
insufficient funds to make payments to you on the capital securities.
Distributions on the capital securities may be deferred. You may have to include
interest in your taxable income before you receive cash.
As long as Peoples has not defaulted under the debentures, Peoples will
have the right, at one or more times, to defer payments of interest on the
debentures for up to ten consecutive semi-annual periods, but not beyond the
maturity date. If Peoples defers payments of interest on the debentures, PEBO
Capital Trust I will defer distributions on its capital and common securities
during any deferral period. However, you would still accumulate distributions at
the rate of 8.62% per annum, plus you would accumulate additional distributions
at the same rate of 8.62% per annum compounded semi-annually, on any unpaid
distributions, to the extent permitted by law. During the pendency of any
deferral period, Peoples generally will be prohibited from declaring or paying
dividends on Peoples' capital stock. See "Description of capital
securities--Distributions" and "Description of debentures--Option to extend
interest payment date."
During a deferral period, you must accrue interest income for United
States federal income tax purposes with respect to your pro rata share of the
debentures held by PEBO Capital Trust I. As a result, you must include the
accrued interest as interest income for United States federal income tax
purposes before you receive any cash distributions. You will also not receive a
cash distribution related to any accrued and unpaid interest from PEBO Capital
Trust I if you sell the capital securities before the end of any deferral period
or the record date relating to that cash distribution.
During a deferral period, accrued but unpaid distributions will
increase your tax basis in the capital securities. If you sell the capital
securities during a deferral period, your increased tax basis will decrease the
amount of any capital gain, or increase the amount of any capital loss, that you
may have otherwise realized on the sale. A capital loss, except in some limited
circumstances, cannot be applied to offset ordinary income.
Peoples has no current intention of exercising its right to defer
interest payments on the debentures. However, if Peoples exercises its right in
the future, the market price of the capital securities is likely to be affected.
If you sell your capital securities during an interest deferral period, you may
not receive the same return on investment as someone else who continues to hold
the capital securities. As a result of the existence of Peoples' right to defer
interest payments, the market price of the capital securities, which represent
preferred beneficial interests in PEBO Capital Trust I, may be more volatile
than the market prices of other debt securities that are not subject to optional
deferrals.
You are subject to prepayment risk on your capital securities.
The debentures issued by Peoples to PEBO Capital Trust I have a stated
maturity date of May 1, 2029. However, they may be redeemed by Peoples prior to
maturity as a result of the following:
o In whole, upon a change in the federal tax laws or an
interpretation of the tax laws by the courts or the IRS, which
would result in a risk that:
o PEBO Capital Trust I may be subject to federal income tax;
o interest paid by Peoples on the debentures will not be deductible
by Peoples for federal income tax purposes; or
o PEBO Capital Trust I is or will be subject to more than a
minimal amount of other taxes or governmental charges.
o In whole, upon a change in the laws or regulations that would
consider PEBO Capital Trust I to be an investment company
under the Investment Company Act of 1940.
o In whole, upon a change in the laws or regulations creating a
substantial risk that Peoples will not be able to treat the
capital securities as Tier I capital for regulatory purposes.
Peoples may also redeem debentures, in whole or in part, at any time
after May 1, 2009, at a redemption premium as described under "Description of
debentures--Optional prepayment." You should assume that Peoples will exercise
its redemption option if Peoples is able to refinance at a lower interest rate
or if it is otherwise in the interest of Peoples to do so.
The exercise of these redemption rights is subject to Peoples receiving
prior regulatory approval, if required. For further information concerning
events which may cause the redemption of the debentures and prepayment of the
capital securities, see "Description of capital securities--Redemption."
Distribution of debentures to holders of capital securities may have an adverse
effect on the market price of the capital securities.
Your investment in the capital securities may decrease in value if
Peoples' debentures are distributed to you in liquidation of PEBO Capital Trust
I. We cannot predict the liquidity of the market or market prices for the
debentures that may be distributed. Accordingly, the debentures that you receive
upon a distribution, or the capital securities you hold pending a distribution,
may trade at a discount to the price that you paid to purchase the capital
securities.
You should carefully review all the information regarding the
debentures contained in this prospectus. Under "Certain federal income tax
consequences--Receipt of debentures or cash upon liquidation of PEBO Capital
Trust I," we discuss applicable federal income tax consequences of a
distribution of the debentures.
LIMITED COVENANTS RELATING TO THE CAPITAL SECURITIES AND THE DEBENTURES DO NOT
PROTECT YOU.
The covenants in the governing documents relating to the capital
securities and the debentures are limited. As a result, the governing documents
do not protect you in the event of an adverse change in Peoples' financial
condition or results of operations. In addition, the governing documents do not
limit the ability of Peoples or its subsidiaries to incur additional debt. You
should not consider the terms of the governing documents to be a significant
factor in evaluating whether Peoples will be able to comply with its obligations
under the debentures or its guarantee for the benefit of capital securities
holders.
YOU WILL HAVE LIMITED RIGHTS UNDER PEOPLES' GUARANTEE.
The guarantee by Peoples for the benefit of holders of capital
securities guarantees to you the following payments, to the extent not paid by
or on behalf of PEBO Capital Trust I:
o Any accumulated and unpaid distributions required to be paid
on your capital securities, but only to the extent that PEBO
Capital Trust I has funds on hand legally available for the
payment of those distributions.
o The redemption price of your capital securities to be
redeemed, but only to the extent that PEBO Capital Trust I has
funds on hand legally available for the redemption of those
capital securities at that time.
o Upon a voluntary or involuntary dissolution, winding up or
liquidation of PEBO Capital Trust I, unless debentures are
distributed to you, the lesser of:
o the aggregate liquidation amount of your capital
securities and all accumulated and unpaid
distributions on your capital securities to the date
of payment, to the extent that PEBO Capital Trust I
has funds on hand legally available for the payment
of those amounts at that time; and
o the amount of assets of PEBO Capital Trust I
remaining available for distribution to you at that
time, after the satisfaction of liabilities to
creditors of PEBO Capital Trust I as provided by
applicable law.
The holders of at least a majority in liquidation amount of the capital
securities have the right to direct the time, method and place of conducting any
proceeding for any remedy available under the guarantee or to direct the
exercise of any trust power conferred under the guarantee. As a holder of
capital securities, you may, to the extent permitted by applicable law,
institute a legal proceeding directly against Peoples to enforce your rights
under the guarantee without first instituting a legal proceeding against PEBO
Capital Trust I, the guarantee trustee or any other person or entity. If Peoples
were to default on its obligation to pay amounts payable under the debentures,
PEBO Capital Trust I would not have sufficient funds for the payment of
distributions on the capital securities or amounts payable on redemption of the
capital securities. You will not then be able to rely upon Peoples' guarantee
for payment of those amounts. Instead, if an event of default exists under the
indenture related to the debentures, and that event is attributable to the
failure of Peoples to pay the principal of or interest on the debentures on the
day on which that payment is due and payable, then you may institute a legal
proceeding directly against Peoples for enforcement of payment. Even if Peoples
makes payments to you in connection with such an action, Peoples will remain
obligated to pay the principal of and interest on the debentures. Peoples will
also be subrogated to your rights with respect to payments on the capital
securities to the extent of any payments made by Peoples to you in connection
with your actions taken against Peoples. Except as described in this prospectus,
you cannot exercise directly any other remedy available to holders of debentures
or assert directly any other right in respect of the debentures. See
"Description of debentures--Enforcement of rights by holders of capital
securities" and "--Debenture events of default" and "Description of guarantee by
Peoples." As a holder of capital securities, you are deemed to have agreed to
the provisions of the indenture under which the debentures are issued to PEBO
Capital Trust I.
AS A HOLDER OF CAPITAL SECURITIES, YOU WILL HAVE LIMITED VOTING RIGHTS.
As a holder of capital securities, you will have limited voting rights.
These voting rights relate only to the modification of the capital securities
and the exercise of the rights of PEBO Capital Trust I as a holder of debentures
issued by Peoples. In general, only Peoples can replace or remove any of the
trustees of PEBO Capital Trust I. However, if an event of default under the
trust agreement relating to PEBO Capital Trust I is continuing, holders of at
least a majority in aggregate liquidation amount of the capital securities may
replace the property trustee and the Delaware trustee of PEBO Capital Trust I.
See "Description of capital securities--Events of default; Notice" for a
description of events of default. Peoples and the property trustee and
individual administrative trustees of PEBO Capital Trust I may amend the trust
agreement without your consent in order to:
o Ensure that PEBO Capital Trust I will not be classified as an association
taxable as a corporation;
o Enable PEBO Capital Trust I to qualify as a grantor trust for federal
income tax purposes; or
o Ensure that PEBO Capital Trust I will not be required to register
as an "investment company" under the Investment Company Act of 1940.
An amendment may adversely affect your interests. You have no voting rights with
respect to any matters submitted to a vote of the shareholders of Peoples. See
"Description of capital securities--Voting rights; Amendment of the trust
agreement" for more information on your limited voting rights.
TRADING CHARACTERISTICS OF THE CAPITAL SECURITIES MAY CREATE ADVERSE TAX
CONSEQUENCES FOR YOU.
The capital securities may trade at a price that does not reflect the
value of accrued but unpaid interest on the underlying debentures. If you
dispose of your capital securities between record dates for payments on the
capital securities, you may have adverse tax consequences. Under these
circumstances, you will be required to include accrued but unpaid interest on
the debentures allocable to your capital securities through the date of
disposition in your income as ordinary income. If interest on the debentures is
included in income under the original issue discount provisions, you would add
this amount to your adjusted tax basis in your share of the underlying
debentures deemed disposed. If your selling price is less than your adjusted tax
basis, which will include all accrued but unpaid original issue discount
interest included in your income, you could recognize a capital loss. Capital
losses cannot be applied to offset ordinary income for federal income tax
purposes, subject to exceptions. See "Certain federal income tax
consequences--Interest income and original issue discount" and "--Sales of
capital securities" for more information on possible adverse tax consequences to
you.
THERE IS NO ESTABLISHED TRADING PUBLIC MARKET FOR THE CAPITAL SECURITIES.
The original capital securities have not been registered under the
Securities Act and will continue to be subject to restrictions on
transferability under the Securities Act and applicable state securities laws if
they are not exchanged for new capital securities. The new capital securities
generally may be resold or otherwise transferred by the holders, who are not
affiliates of Peoples or PEBO Capital Trust I or broker-dealers who purchased
original capital securities for resale, without compliance with the registration
requirements under the Securities Act. However, the capital securities will
constitute a new issue of securities with no established trading market. Capital
securities may be transferred only in blocks having a liquidation amount of at
least $100,000 (100 capital securities). Peoples and PEBO Capital Trust I were
advised by Sandler O'Neill & Partners, L.P., the initial purchaser in connection
with the offering of the original capital securities, that Sandler O'Neill
intends to make a market in the capital securities. However, Sandler O'Neill is
not obligated to do so and any market-making activity with respect to the
capital securities may be discontinued at any time without notice. In addition,
that market-making activity will be subject to the limits imposed by the
Securities Act and the Securities Exchange Act of 1934 and may be limited during
the exchange offer. Accordingly, no assurance can be given that an active public
or other market will develop for the new capital securities or the original
capital securities. If an active public market does not develop, the market
price and liquidity of the new capital securities may be adversely affected. We
do not intend to apply for listing of the new capital securities on any
securities exchange or for quotation through the Nasdaq Stock Market.
If a public trading market develops for the new capital securities,
future trading prices will depend on many factors, including, among other
things, prevailing interest rates, Peoples' results of operations and the market
for similar securities.
If you are eligible to participate in the exchange offer but do not exchange
your original capital securities, you will not have any exchange rights
following the closing of the exchange offer and your original capital securities
will remain restricted securities.
The original capital securities have not been registered under the
Securities Act or any state securities laws. As a result, the original capital
securities may not be offered, sold or otherwise transferred except in
compliance with the registration requirements of the Securities Act and any
applicable state securities laws, or in connection with an exemption from such
requirements.
Original capital securities which are not exchanged for new capital
securities in this exchange offer will continue to have a legend which describes
these transfer restrictions. In addition, after the exchange offer ends, holders
of original capital securities will no longer have the right to have their
original capital securities registered under the Securities Act. We do not
intend to register any original capital securities under the Securities Act
which have not been exchanged after the exchange offer ends except under limited
circumstances.
Although the original capital securities have been designated for
trading in the Private Offerings, Resales and Trading through Automated Linkages
(PORTAL) market, to the extent that original capital securities are tendered and
accepted in connection with the exchange offer, any trading market for original
capital securities which remain outstanding after the exchange offer could be
limited.
The new capital securities and any original capital securities which
remain outstanding after consummation of the exchange offer will vote together
as a single class for purposes of determining whether holders of the requisite
percentage in outstanding liquidation amount have taken actions or exercised
rights under the trust agreement for PEBO Capital Trust I. See "Description of
new securities; Comparison to original securities" and "Description of capital
securities--Voting rights; Amendment of trust agreement."
At the end of the exchange offer, you will not be entitled to any
additional distributions or any further registration rights, except under
limited circumstances.
WHERE YOU CAN FIND MORE INFORMATION
Peoples files annual, quarterly and special reports, proxy statements
and other information with the SEC in compliance with the information reporting
requirements of the Exchange Act. You can read and copy any materials filed with
the SEC at the following locations:
Public Reference Room New York Regional Office Chicago Regional Office
450 Fifth Street, N.W. 7 World Trade Center 500 West Madison Street
Room 1024 Suite 1300 Suite 1400
Washington, D.C. 20549 New York, NY 10048 Chicago, IL 60661
You may also obtain copies of this information by mail from the Public
Reference Section of the SEC, 450 Fifth Street, N.W., Room 1024, Washington,
D.C. 20549 at prescribed rates. Please call the SEC at 1-800-SEC-0330 for
further information on the operation of the Public Reference Room. Our filings
are also available to the public from commercial document retrieval services and
from the web site maintained by the SEC at "http://www.sec.gov."
No separate financial statements of PEBO Capital Trust I are included
in this prospectus and no separate financial statements will be prepared in the
future. We do not believe that such financial statements are helpful because:
o All of the voting securities of PEBO Capital Trust I will be owned,
directly or indirectly, by Peoples;
o PEBO Capital Trust I has no operating history or independent operation;
o PEBO Capital Trust I is not engaged in, and does not propose
to engage in, any activity other than holding the debentures
issued by Peoples as assets, issuing securities of PEBO
Capital Trust I and engaging in other incidental activities;
and
o The obligations of PEBO Capital Trust I under its securities
are fully and unconditionally guaranteed by Peoples, on a
subordinated basis, to the extent PEBO Capital Trust I has
funds available to meet the obligations.
This prospectus is part of a registration statement on Form S-4 filed
by Peoples and PEBO Capital Trust I with the SEC under the Securities Act. As
allowed by SEC rules, this prospectus does not contain all the information you
can find in the registration statement or the exhibits filed with the
registration statement. You should review the registration statement and the
exhibits filed with the registration statement for further information regarding
Peoples, PEBO Capital Trust I and the new capital securities being offered by
this prospectus. The registration statement and its exhibits may be inspected at
the public reference facilities of the SEC at the addresses listed above.
INCORPORATION BY REFERENCE
The following documents of Peoples which have been previously filed
with the SEC are incorporated into this prospectus by reference:
o Peoples' Annual Report on Form 10-K for the fiscal year ended December
31, 1998.
o Peoples' Annual Report on Form 10-K/A for the fiscal year ended December
31, 1998.
o Peoples' Quarterly Report on Form 10-Q for the fiscal quarter ended March
31, 1999.
o Peoples' Current Reports on Form 8-K dated April 1, 1999, April 12, 1999,
April 20, 1999, April 22, 1999, July 1, 1999 and July 21, 1999.
All documents filed by Peoples under Section 13(a), 13(c), 14 or 15(d)
of the Exchange Act after the date of this prospectus and prior to the
termination of the offering of the new securities will be incorporated by
reference into this prospectus and become part of this prospectus from the date
of filing of those documents. Any statement contained in this prospectus or in a
document incorporated by reference in this prospectus will be modified or
superseded for purposes of this prospectus to the extent that a statement
contained in this prospectus, or in any other subsequently filed document which
also is incorporated by reference in this prospectus, modifies or supersedes
that statement.
When we refer to this prospectus, we mean not only this prospectus but
any documents which are incorporated in this prospectus by reference.
We will provide without charge to any person to whom this prospectus is
delivered, on the oral or written request of that person, a copy of any or all
of the documents incorporated by reference in this prospectus other than an
exhibit, unless that exhibit is specifically incorporated by reference. Requests
for these documents should be directed to: Charles R. Hunsaker, Esq., General
Counsel, Peoples Bancorp Inc., 138 Putnam Street, Marietta, Ohio 45750. Mr.
Hunsaker's telephone number is 740-374-6109. Peoples also maintains a website at
"www.peoplesbancorp.com."
FORWARD-LOOKING STATEMENTS
Some of the information presented in or incorporated by reference into
this prospectus contains "forward-looking" statements within the meaning of the
Private Securities Litigation Reform Act of 1995. Although we believe that the
expectations expressed in these forward-looking statements are based on
reasonable assumptions within the bounds of our knowledge of our business and
operations, it is possible that actual results may differ materially from these
expectations. Accordingly, investors are cautioned not to place undue reliance
on these forward-looking statements. Factors that could cause actual results to
differ from expectations include:
o the growth of the economy
o interest rate movements
o timely development of technology enhancements for our products and
operating systems
o the impact of competitive products, services and pricing
o customer-based requirements
o legislative and regulatory changes affecting the banking industry
USE OF PROCEEDS
Neither Peoples nor PEBO Capital Trust I will receive any cash proceeds
from the issuance of the new capital securities. The original capital securities
surrendered in exchange for the new capital securities will be retired and
cancelled.
The proceeds to PEBO Capital Trust I from the offering of the original
capital securities were $30,000,000, before giving effect to approximately $1.0
million of commissions and expenses of the offering payable by Peoples. All of
the proceeds from the sale of the original capital securities and the common
securities of PEBO Capital Trust I ($30,928,000) were invested by it in the
original debentures issued by Peoples. Peoples invested approximately $10.0
million of the net proceeds in its banking subsidiary, The Peoples Banking and
Trust Company, to increase that bank's capital level. Peoples Bank expects to
leverage the proceeds contributed to it by purchasing approximately $150 million
of additional investment securities by the end of the second quarter of 1999.
The investment securities will primarily consist of U.S. Agency securities and
mortgage-backed investments. Funding sources for the investment securities will
be comprised of FHLB borrowings and national market repurchase agreements. In
addition, Peoples has used a portion of the proceeds from the debentures to
purchase approximately $1.8 million of treasury stock (approximately 74,000
treasury shares). The remaining net proceeds from the sale of the debentures of
$17.2 million have been retained by Peoples for general corporate purposes,
including additional repurchases of its common shares and other investments.
ACCOUNTING TREATMENT
For financial reporting purposes, PEBO Capital Trust I will be treated
as a subsidiary of Peoples, and, accordingly, the accounts of PEBO Capital Trust
I will be included in the consolidated financial statements of Peoples. The
capital securities will be presented as a separate line item in the consolidated
balance sheets of Peoples, entitled "Guaranteed Preferred Beneficial Interests
in Junior Subordinated Debentures", and appropriate disclosures about the
capital securities, Peoples' guarantee for the benefit of capital securities
holders and the debentures will be included in the notes to the consolidated
financial statements. For financial reporting purposes, Peoples will record
distributions on the capital securities as a non-interest expense in the
consolidated statements of income.
CAPITALIZATION
The following table sets forth the capitalization of Peoples, on a
consolidated basis, at March 31, 1999, and as adjusted to give effect to the
consummation of the offering of the original capital securities. The issuance of
the new capital securities in the exchange offer will have no effect on the
capitalization of Peoples. The data contained in this table should be read
together with the consolidated financial statements and notes thereto of Peoples
and its subsidiaries. See "Incorporation by reference."
<TABLE>
<CAPTION>
At
March 31, 1999
---------------------------------------
As
Actual Adjusted
------------------ ---------------
<S> <C> <C>
(Dollars in thousands)
Long-term Borrowings:
FHLB advances $ 37,957 $ 37,957
Term note payable 2,550 2,550
Total long-term borrowings $ 40,507 $ 40,507
Guaranteed preferred beneficial interests in junior
subordinated debentures(1) $ -- $ 28,990
Stockholders' Equity:
Common shares, no par value, 12,000,000 shares
authorized, 6,375,164 issued (including shares $ 50,814 $ 50,814
in treasury)
Accumulated comprehensive income, net of
deferred income taxes 2,732 2,732
Retained earnings 35,262 35,262
Treasury shares, at cost, 67,786 shares (2,048) (2,048)
Total stockholders' equity $ 86,760 $ 86,760
Total capitalization $ 127,267 $ 156,257
Capital Ratios: (2)
Tier 1 capital to risk-weighted assets 10.83% 14.45%
Total capital to risk-weighted assets 12.27% 17.29%
Leverage ratio (3) 7.41% 9.55%
- ----------------------
<FN>
(1) As described in this prospectus, the sole assets of PEBO Capital Trust I,
which is a subsidiary of Peoples, are $30,928,000 aggregate principal
amount of the debentures which mature on May 1, 2029. Peoples owns all of
the common securities issued by PEBO Capital Trust I. The amount shown
here is net of issuance costs of $1,010,000. See "Description of
debentures."
(2) Capital ratios in the "As Adjusted" column are computed in accordance
with regulatory guidelines.
(3) The leverage ratio is Tier 1 capital divided by quarterly average total
assets less intangibles.
</FN>
</TABLE>
SELECTED CONSOLIDATED FINANCIAL AND OTHER DATA OF PEOPLES
The following selected consolidated financial data for the five years
ended December 31, 1998 is derived from Peoples' audited consolidated financial
statements. The financial data for the three-month periods ended March 31, 1999
and 1998 are derived from Peoples' unaudited financial statements. The unaudited
financial statements include all adjustments, consisting of normal recurring
accruals, which Peoples considers necessary for a fair presentation of the
financial position and the results of operations for these periods. Operating
results for the three months ended March 31, 1999 are not necessarily indicative
of the results that may be expected for the entire year ending December 31,
1999. The data should be read in conjunction with the consolidated financial
statements, related notes and other financial information incorporated by
reference in this prospectus.
<TABLE>
<CAPTION>
At or for the year ended December 31,
--------------------------------------------------------------------------
1998 1997 1996 1995 1994
(Dollars in Thousands, except ratios and per share data)
<S> <C> <C> <C> <C> <C>
Summary of Operating Results:
Total interest income..............$....63,645 $ 53,836 $ 47,397 $ 43,068 $ 35,801
Total interest expense..................30,497 25,216 21,966 20,777 15,424
------------- ------------- ------------- ------------- -------------
Net interest income.....................33,148 28,620 25,431 22,291 20,377
Provision for loan losses................2,325 2,589 1,965 1,315 765
------------- ------------- ------------- ------------- -------------
Net interest income after
provision for loan losses.............30,823 26,031 23,466 20,976 19,612
Net securities gains (losses)............ 418 (28) 48 24 (237)
Other income.............................6,820 5,966 5,130 4,457 4,378
Other expenses..........................23,276 19,265 17,522 16,818 15,672
------------- ------------- ------------- ------------- -------------
Income before provision for
income taxes..........................14,785 12,704 11,122 8,639 8,081
Provision for income taxes...............4,740 4,099 3,471 2,589 2,333
------------- ------------- ------------- ------------- -------------
Net income................$....10,045 $ 8,605 $ 7,651 $ 6,050 $ 5,748
Per Share Data:
Net income:
Basic............................... 1.59 1.50 1.35 $ 1.05 $ 0.99
Diluted............................. 1.54 1.46 1.33 1.05 0.99
Weighted average shares
outstanding:
Basic ...........................6,319,437 5,730,711 5,672,354 5,743,940 5,789,753
Diluted..........................6,510,917 5,911,260 5,749,358 5,775,910 5,809,071
Cash dividends paid...................... 0.48 0.45 0.39 0.34 0.29
Book value at end of period.............. 13.63 12.47 9.89 9.11 7.88
Balance Sheet Data (at year end):
Net loans...............................558,408 513,214 415,540 $ 372,800 $ 354,570
Investment securities...................235,569 174,291 147,783 131,762 99,419
Federal Funds sold....................... 9,700 10,350 2,100 3,500 4,500
Total assets............................880,284 758,158 616,635 543,430 498,006
Total deposits..........................714,168 611,107 504,692 429,077 403,819
Long-term borrowings.....................40,664 28,577 29,200 23,142 23,787
Stockholders' equity.....................86,014 78,818 56,193 51,474 45,635
Performance Ratios:
Return on average total assets.......... 1.20 % 1.29 % 1.29 % 1.15 % 1.20 %
Return on average stockholders'
equity................................. 12.2 14.3 14.4 12.3 12.9
Average stockholders' equity
to average total assets................ 9.9 9.0 8.9 9.3
9.3
Average loans to average deposits........ 80.9 85.5 84.0 85.2 85.5
Dividend payout ratio.................... 30.4 30.5 30.5 32.2 29.3
Net interest margin.................... 4.47 4.74 4.75 4.67 4.75
Efficiency ratio....................... 50.38 51.06 53.76 60.55 60.84
Asset Quality Ratios:
Nonperforming loans to total
loans (net of unearned 0.28 % 0.33 % 0.39 % 0.46 % 0.58 %
income)(1)...............................
Net charge-offs (recoveries) to
average total loans.................... 0.22 0.30 0.45 0.37 0.10
Allowance for loan losses as a
percentage of total loans.............. 1.67 1.60 1.63 1.77 1.88
Allowance for loan losses as a
percentage of nonperforming
loans(1)...............................602.6 491.2 417.1 381.5 326.0
Capital Ratios:
Total capital to risk-weighted
assets.................................11.95 % 14.34 % 12.86 % 13.85 % 14.13 %
Tier 1 capital to risk-weighted
assets.................................10.54 13.09 11.66 12.60 12.88
Leverage ratio........................... 7.08 9.29 7.92 8.81 8.93
Ratios of Earnings to Fixed Charges:(2)
Including interest on deposits........... 1.48x 1.50x 1.51x 1.42x 1.52x
Excluding interest on deposits........... 4.27x 5.25 4.54 4.53 5.31
- -----------------
<FN>
(1) Nonperforming assets consist of nonaccrual loans, loans contractually past
due 90 days or more, loans with restructured terms and foreclosed properties.
(2) Fixed charges means interest, whether expensed or capitalized. Earnings is
defined as pretax income with fixed charges added back, but excluding any amount
of interest capitalized during the period.
</FN>
</TABLE>
<TABLE>
<CAPTION>
At or for the three months ended
March 31,
-----------------------------------------------------
1999 1998
(Dollars in Thousands, except ratios and per share data)
<S> <C> <C>
Summary of Operating Results:
Total interest income............................. $ 15,985 $ 15,364
Total interest expense............................ 7,242 7,320
Net interest income............................... 8,743 8,044
Provision for loan losses......................... 537 696
Net interest income after provision for
loan losses..................................... 8,206 7,348
Net securities gains.............................. -- 4
Other income...................................... 1,844 1,618
Other expenses.................................... 6,236 5,414
Income before provision for income taxes.......... 3,814 3,556
Provision for income taxes........................ 1,184 1,180
Net income...................................... $ 2,630 $ 2,376
Per Share Data:
Net income:
Basic......................................... $ 0.42 $ 0.38
Diluted....................................... 0.41 0.36
Weighted average shares outstanding:
Basic......................................... 6,315,613 6,321,352
Diluted....................................... 6,463,929 6,529,108
Cash dividends paid............................... 0.13 0.12
Book value at end of period....................... 13.76 12.65
Balance Sheet Data (at quarter end):
Net loans......................................... $ 564,705 $ 558,408
Investment 223,118 235,569
securities.............................
Federal Funds sold................................ 6,150 9,700
Total assets...................................... 30,515 880,284
Total deposits.................................... 706,994 714,168
Long-term borrowings.............................. 40,507 40,664
Stockholders' equity.............................. 86,760 86,014
Performance Ratios:
Return on average total assets.................... 1.21% 1.22%
Return on average stockholders' equity............ 12.12 11.94
Average stockholders' equity to average total
assets........................................ 9.95 10.25
Average loans to average deposits................. 81.27 84.25
Dividend payout ratio............................. 30.76 30.72
Asset Quality Ratios:
Nonperforming assets to total loans (net of 0.27% 0.24%
unearned income) and foreclosed properties
at quarter end (1)............................
Net charge-offs (recoveries) to average 0.03 0.04
total loans...................................
Allowance for loan losses as a percentage 1.72 1.70
of total loans................................
Allowance for loan losses as a percentage 636.60 707.10
of nonperforming loans (1)
Capital Ratios:
Total capital to risk-weighted assets............. 10.83% 12.87%
Tier 1 capital to risk-weighted assets............ 12.27 14.13
Leverage ratio.................................... 7.41 8.60
Ratio of Earnings to Fixed Charges: (2)
Including interest on deposits.................... 1.52x 1.48x
Excluding interest on deposits.................... 5.65 4.51
- -----------------
<FN>
(1) Nonperforming assets consist of nonaccrual loans, loans contractually past
due 90 days or more, loans with restructured terms and foreclosed properties.
(2) Fixed charges means interest, whether expensed or capitalized. Earnings is
defined as pretax income with fixed charges added back, but excluding any amount
of interest capitalized during the period.
</FN>
</TABLE>
PEOPLES BANCORP INC.
Peoples was organized in 1980 as a bank holding company. Peoples'
subsidiaries include The Peoples Banking and Trust Company, The First National
Bank of Southeastern Ohio, Peoples Bank FSB, and The Northwest Territory Life
Insurance Company.
Peoples' banking subsidiaries operate 35 sales offices in the states of
Ohio, West Virginia, and Kentucky. At March 31, 1999, Peoples had total assets
of $871.9 million, total loans of $574.6 million, total deposits of $707.0
million, and total stockholders' equity of $86.8 million. At March 31, 1999,
Peoples and its subsidiaries had 356 full-time equivalent employees.
Over the past several years, Peoples has experienced significant growth
in assets and stockholders' equity, primarily through acquisitions described
below as well as banking center purchases in markets contiguous to the markets
served by Peoples. For the five-year period ended December 31, 1998, Peoples'
assets grew at a 12.1% compound annual growth rate, while stockholders' equity
grew at a compound annual growth rate of 13.5%. Peoples has also had a history
of consistent earnings growth. Net income per share grew at a compound rate of
9.9% for the five-year period ended December 31, 1998. Over that same period,
Peoples' annual return on average assets and stockholders' equity averaged 1.23%
and 13.24%, respectively. For the year ended December 31, 1998, Peoples' return
on average annual assets was 1.20% and its return on average stockholders'
equity was 12.21%. For the quarter ended March 31, 1999, Peoples' return on
average assets was 1.21% and its return on average stockholders' equity was
12.12%
Peoples routinely explores opportunities for additional growth and
expansion of its core financial service businesses, including the acquisition of
companies engaged in similar activities. Management also focuses on internal
growth as a method for reaching performance goals and reviews key performance
indicators on a regular basis to measure Peoples' success. There can be no
assurance, however, that Peoples will be able to grow, or if it does, that any
growth or expansion will result in an increase in Peoples' earnings, dividends,
book value or the market value of its common shares.
The Peoples Banking and Trust Company is a full-service commercial bank
chartered as an Ohio banking corporation under its present name in Marietta,
Ohio, in 1902. Peoples Bank is engaged in general commercial and consumer
banking business, serving individuals and businesses from offices in Washington,
Athens, Meigs, Fairfield, Gallia, and Licking Counties in Ohio, as well as Wood,
Mason, and Wetzel Counties in West Virginia. In addition, Peoples Bank's
Investment and Trust Division provides investment and trust services to its
clients. At March 31, 1999, the Investment and Trust Division of Peoples Bank
managed approximately $559 million in trust assets (at market value).
In 1981, Peoples acquired The First National Bank of Southeastern Ohio,
a national banking association first chartered in 1900. First National Bank is
also engaged in general commercial and consumer banking business and serves
customers in Noble and Morgan Counties in Ohio. First National Bank also owns
two insurance agency subsidiaries, which were established in 1995. These
insurance agencies were the first insurance agencies in Ohio associated with a
financial institution to receive licenses to conduct a broad-based insurance
business. The insurance agencies offer a complete line of life and property and
casualty products. In addition, a full line of investment products are offered
through an unaffiliated registered broker dealer.
In 1984, Peoples began operating The Northwest Territory Life Insurance
Company, which reinsures credit life and disability insurance issued to
customers of banking subsidiaries of Peoples by the issuing insurance company.
In 1997, Peoples purchased Russell Federal Savings Bank and Gateway
Bancorp, Inc., which owned a savings bank subsidiary, Catlettsburg Federal
Savings Bank. Russell Federal was originally chartered as a mutual association
in 1914 and later converted to a federally-chartered stock savings bank in 1994.
Catlettsburg Federal was originally chartered as a mutual savings and loan
association in 1935 and converted to a federally-chartered stock savings bank in
1994 with Gateway Bancorp, Inc. as its sole shareholder. Effective January 1,
1999, Peoples combined Russell Federal and Catlettsburg Federal to create a
single savings bank entity named Peoples Bank FSB.
Peoples' banking subsidiaries provide a wide range of financial
services, including:
o checking accounts;
o NOW and Super NOW accounts;
o money market deposit accounts;
o savings accounts;
o time certificates of deposit;
o commercial, installment, and commercial and residential real estate
mortgage loans;
o credit and debit cards;
o lease financing;
o corporate and personal trust services;
o safe deposit rental facilities; and
o sales of travelers checks, money orders and cashier's checks.
Services are provided through ordinary walk-in offices, automated
teller machines, automobile drive-in facilities called "Motor Banks", banking by
phone, and limited cash management services through computer banking.
Peoples' service area has a diverse economic structure. Principal
industries in the area include metals, plastics and petrochemical manufacturing;
oil, gas and coal production and related support industries. In addition,
tourism, education and other service-related industries are important and
growing industries. Consequently, Peoples is not dependent upon any one industry
segment for its business opportunities.
To meet the demands of the increasingly competitive financial services
industry, management has adopted a philosophy that full-service commercial and
consumer banking relationships require an understanding of the customer's
financial needs. Consistent with this
philosophy, Peoples has sought to make its key professional associates more
accessible to its customers. Management believes that Peoples' flexibility to
customize products and services through integrated products and delivery systems
is one of its competitive advantages. It is Peoples' goal to provide integrated,
personalized financial services for the economic benefit and well-being of the
residents and businesses of the communities in its markets. Peoples' associates
are well-educated personnel who apply sound business practices focused on
customer satisfaction, profits, and growth. Key elements of Peoples' strategy
include:
o Being the "economic engine" in the markets we serve. Peoples primarily
focuses on non-major metropolitan markets in which to provide products
and services. Management believes Peoples has developed a niche and
certain level of expertise in serving these communities. In addition
to serving the financial needs of the communities, Peoples strives to
be the driving force in the communities it serves through civic
leadership and involvement in community activities.
o Continued development of integrated sales and service initiatives.
Recently Peoples has implemented a process to enhance the sales skills
and service abilities of its associates. Peoples historically has
operated under a "needs-based" selling approach that, we believe, has
proven successful in serving the financial needs of many customers.
Management anticipates that in future periods Peoples will increase
its investment in sales training and education to assist in the
development of Peoples' associates in their identification of customer
service opportunities and serving customers with the financial
products they need.
It is not Peoples' strategy to compete solely on the basis of interest
rates. Management believes that a focus on customer relationships and
incentives that promote customers' continued use of Peoples' financial
products and services will lead to enhanced revenue opportunities. In
future periods, Peoples will focus its efforts to fully integrate its
recent entry into insurance product offerings with its traditional
banking operations. Management believes these integration efforts will
lead to enhanced revenues through complementary product offerings that
satisfy customer demands for high quality, "one-stop shopping".
o Maintain long-term focus. Peoples' management and associates share a
long-term focus that promotes consistent enhancements to results of
operations and other performance ratios. This long-term focus applies
to possible acquisitions and expansion of its markets (and market
penetration) through new offices. In 1999, Peoples will open sales
offices in three West Virginia Wal-Mart retail superstores that will
enhance visibility to an increased number of shoppers in those
markets. The first of these three sales offices opened on April 1,
1999, in the Wal-Mart superstore located in New Martinsville, West
Virginia. The second opened on July 1, 1999, in the Wal-Mart
superstore located in Vienna, West Virginia. Management believes these
new sales centers will be models for future sales and service efforts
and for future banking center expansion, using electronic distribution
channels and proactive sales interaction with these prospective
customers.
Other expansions to Peoples'financial service opportunities will complement
Peoples' core competencies and strategic intent. Management considers
mergers and acquisitions to be a viable method of enhancing Peoples'
earnings potential and will continue to pursue appropriate business
opportunities as they develop. Consistent with Peoples' philosophy and
growth strategies, Peoples frequently evaluates opportunities to
acquire banks or banking centers that complement Peoples' existing
core businesses and markets.
Management will continue to focus efforts to expand its electronic delivery
methods to include internet banking in addition to current personal
computer banking systems. Peoples' management plans to invest
resources in future periods to enhance its electronic delivery
methods. Management believes Peoples' array of financial products,
services, and delivery systems compare favorably with all current and
prospective competitors.
o Maintain strong asset quality ratios and similar balance sheet
composition. Management does not have plans to alter its historic focus
on strong asset quality, and will continue to maintain its conservative
underwriting standards to maintain high asset quality. At March 31,
1999, Peoples' ratio of nonperforming loans to total loans was 0.27%.
Also at that date, Peoples' allowance for loan losses was 1.67% of
total outstanding loans. For the quarter ended March 31, 1999, Peoples'
annualized net charge-offs as a percentage of total loans totaled
0.13%.
At March 31, 1999, Peoples had total outstanding loans of $574.6 million,
of which $230.6 million (or 40.1%) were residential mortgage loans;
$223.2 million (or 38.9%) were commercial, financial or agricultural
based loans; $110.4 million (or 19.2%) were consumer loans; and $10.4
million (or 1.8%) were real estate, construction loans. Consumer loans
include approximately $6.3 million of credit card loan balances. At
March 31, 1999, Peoples had total deposits of $707.0 million,
short-term borrowings of $31.3 million and long-term borrowings of
$40.5 million.
REGULATION AND SUPERVISION
Almost all of Peoples' assets consist of its investments in its banking
subsidiaries. Thus, Peoples' ability to pay principal of, and interest on, the
debentures issued to PEBO Capital Trust I depends primarily upon cash dividends
received by Peoples from its banking subsidiaries.
Peoples' banking subsidiaries may not pay dividends to Peoples if,
after paying those dividends, they would fail to meet the required minimum
levels under the risk-based capital guidelines and the minimum leverage ratio
requirements. The Peoples Banking and Trust Company and The First National Bank
of Southeastern Ohio must have the approval of their respective regulators if a
dividend in any year would cause the total dividends for that year to exceed the
sum of the current year's net income and the retained earnings for the preceding
two years, less required transfers to surplus. Peoples Bank FSB may make capital
distributions during any calendar year equal to the greater of 100% of net
income for the year-to-date plus 50% of the amount by which the lesser of its
tangible, core or risk-based capital exceeds its capital requirement for that
capital component, as measured at the beginning of the calendar year, or 75% of
its net income for the most recent four-quarter period. If the current minimum
capital requirements following a proposed capital distribution are not met,
Peoples Bank FSB must obtain prior approval from the OTS. At March 31, 1999,
approximately $13.8 million of retained earnings plus net income through that
date of the banking subsidiaries were available for the payment of dividends to
Peoples without regulatory approval. Payment of dividends by a banking
subsidiary may be restricted at any time at the discretion of the appropriate
regulator if it deems the payment to constitute an unsafe and/or unsound banking
practice or necessary to maintain adequate capital.
If Peoples does not receive sufficient cash dividends from its banking
subsidiaries, it is unlikely that Peoples will have sufficient funds to make
payments on its debentures. See "Description of debentures."
Other statutes and regulations affecting Peoples and its subsidiaries
are summarized in "Item 1. Business - Supervision and Regulation" of Peoples'
Annual Report on Form 10-K for the fiscal year ended December 31, 1998
incorporated into this prospectus by reference.
PEBO CAPITAL TRUST I
PEBO Capital Trust I is a statutory business trust created under
Delaware law upon the filing of a certificate of trust with the Delaware
Secretary of State. PEBO Capital Trust I exists for the exclusive purposes of:
o issuing and selling its securities, which represent undivided
beneficial interests in the assets of PEBO Capital Trust I;
o investing the gross proceeds from the sale of its securities in the
debentures issued by Peoples; and
o engaging in other incidental activities.
The debentures issued by Peoples are the sole assets of PEBO Capital
Trust I. Payments under those debentures are the sole revenues of PEBO Capital
Trust I. All of the common securities of PEBO Capital Trust I are owned directly
by Peoples. The common securities rank pari passu, and payments will be made
thereon pro rata, with the capital securities, except that upon the occurrence
and continuance of an event of default under the trust agreement for PEBO
Capital Trust I resulting from an event of default under the indenture related
to Peoples' debentures, the rights of Peoples as holder of the common securities
to payments in respect of distributions and payments upon liquidation,
redemption or otherwise will be subordinated to the rights of the holders of the
capital securities. See "Description of capital securities--Subordin-ation of
common securities."
Peoples acquired common securities in a liquidation amount equal to 3%
of the total capital of PEBO Capital Trust I. PEBO Capital Trust I has a term of
approximately 35 years, but may dissolve earlier as provided in the trust
agreement for PEBO Capital Trust I. The business and affairs of PEBO Capital
Trust I are conducted by the trustees appointed by Peoples as direct holder of
the common securities. The trustees are Wilmington Trust Company, as the
property trustee and as the Delaware trustee, and three individual
administrative trustees, who are officers of Peoples. Wilmington Trust Company
acts as sole indenture trustee under the trust agreement for PEBO Capital Trust
I. Wilmington Trust Company also acts as guarantee trustee under Peoples'
guarantee for the benefit of the holders of capital securities and as the
debenture trustee under the indenture related to the debentures. See
"Description of guarantee by Peoples" and "Description of debentures." The
holder of the common securities of PEBO Capital Trust I or, if an event of
default under the trust agreement has occurred and is continuing, the holders of
not less than a majority in liquidation amount of the capital securities, are
entitled to appoint, remove or replace the property trustee and/or the Delaware
trustee of PEBO Capital Trust I. In no event will the holders of the capital
securities have the right to vote to appoint, remove or replace the individual
administrative trustees. Those voting rights are vested exclusively in the
holder of the common securities. The duties and obligations of each trustee of
PEBO Capital Trust I are governed by the trust agreement. Peoples, as issuer of
the debentures, will pay all fees, expenses, debts and obligations, other than
the securities of PEBO Capital Trust I, related to the exchange offer, except as
provided in this prospectus. In addition, Peoples will pay, directly or
indirectly, all ongoing costs, expenses and liabilities of PEBO Capital Trust I.
THE EXCHANGE OFFER
Purpose and effect of the exchange offer
In connection with the sale of the original capital securities, Peoples
and PEBO Capital Trust I entered into a registration rights agreement with
Sandler O'Neill & Partners, L.P., the initial purchaser of the original capital
securities, under which Peoples and PEBO Capital Trust I agreed to file and to
use their reasonable best efforts to cause to be declared effective by the SEC a
registration statement related to the exchange of the original capital
securities for capital securities with terms identical in all material respects
to the terms of the original capital securities. A copy of the registration
rights agreement has been filed as an exhibit to the registration statement of
which this prospectus is a part.
The exchange offer is being made to satisfy the contractual obligations
of Peoples and PEBO Capital Trust I under the registration rights agreement. The
form and terms of the new capital securities are the same as the form and terms
of the original capital securities except that the new capital securities:
o have been registered under the Securities Act and will not be
subject to the same restrictions on transfer under federal and
state securities laws as the original capital securities; and
o will not provide for any increase in the distribution rate.
Upon consummation of the exchange offer, holders of original capital
securities will not be entitled to any increase in the distribution rate thereon
or any further registration rights under the registration rights agreement
(except in limited circumstances). See "Risk factors - If you are eligible to
participate in the exchange offer but do not exchange your original capital
securities, you will not have any exchange rights following the closing of the
exchange offer and your original capital securities will remain restricted
securities." and "Description of new securities; Comparison to original
securities."
The exchange offer is not being made to, nor will PEBO Capital Trust I
accept tenders for exchange from, holders of original capital securities in any
jurisdiction in which the exchange offer or the acceptance thereof would not be
in compliance with the securities or blue sky laws of that jurisdiction.
Unless the context requires otherwise, the term "holder" with respect
to the exchange offer means any person in whose name the original capital
securities are registered on the books of PEBO Capital Trust I or any other
person who has obtained a properly completed bond power from the registered
holder, or any participant in the DTC system whose name appears on a security
position listing as the holder of those original capital securities and who
desires to deliver those original capital securities by book-entry transfer at
DTC.
Under the exchange offer, Peoples will exchange as soon as practicable
after the date of this prospectus, its new guarantee for the original guarantee
and new debentures, in an amount corresponding to the original capital
securities accepted for exchange, for a like aggregate principal amount of
original debentures. The new guarantee and the new debentures have been
registered under the Securities Act.
Terms of the exchange offer
PEBO Capital Trust I hereby offers, upon the terms and subject to the
conditions set forth in this prospectus and in the accompanying letter of
transmittal, to exchange up to $30,000,000 aggregate liquidation amount of new
capital securities for a like aggregate liquidation amount of original capital
securities properly tendered on or prior to the expiration date and not properly
withdrawn. PEBO Capital Trust I will issue, promptly after the expiration date,
an aggregate liquidation amount of up to $30,000,000 of new capital securities
in exchange for a like aggregate liquidation amount of outstanding original
capital securities tendered and accepted in connection with the exchange offer.
Holders may tender their original capital securities in whole or in part in a
liquidation amount of not less than $100,000 (100 capital securities) or any
integral multiple of $1,000 liquidation amount (one capital security) in excess
thereof, provided that if any original capital securities are tendered in
exchange for part, the untendered liquidation amount must be $100,000 or any
integral multiple of $1,000 in excess of $100,000.
The exchange offer is not conditioned upon any minimum liquidation
amount of original capital securities being tendered. As of the date of this
prospectus, $30,000,000 aggregate liquidation amount of the original capital
securities is outstanding.
Holders of original capital securities do not have any appraisal or
dissenters' rights in connection with the exchange offer. Original capital
securities which are not tendered for or are tendered but not accepted in
connection with the exchange offer will remain outstanding and be entitled to
the benefits of the trust agreement for PEBO Capital Trust I, but will not be
entitled to any further registration rights under the registration rights
agreement. See "Description of new securities; Comparison to original
securities."
If any tendered original capital securities are not accepted for
exchange because of an invalid tender, the occurrence of other events described
in this prospectus or otherwise, certificates for any unaccepted original
capital securities will be returned, without expense, to the tendering holder
promptly after the expiration date.
Holders who tender original capital securities in connection with the
exchange offer will not be required to pay brokerage commissions or fees or,
subject to the instructions in the letter of transmittal, transfer taxes with
respect to the exchange of original capital securities in connection with the
exchange offer. Peoples will pay all charges and expenses, other than applicable
taxes described below, in connection with the exchange offer. See "--Fees and
expenses."
Neither the Board of Directors of Peoples nor any trustee of PEBO
Capital Trust I makes any recommendation to holders of original capital
securities as to whether to tender or refrain from tendering all or any portion
of their original capital securities under the exchange offer. In addition, no
one has been authorized to make any recommendation. Holders of original capital
securities must make their own decision whether to tender under the exchange
offer and, if so, the aggregate amount of original capital securities to tender
based on those holders' own financial position and requirements.
Expiration date; Extensions; Amendments
The expiration date of the exchange offer is 5:00 p.m., New York City
time, on _____________, 1999. If we choose to extend the exchange offer, the
expiration date will be the latest date and time to which the exchange offer is
extended.
Peoples and PEBO Capital Trust I expressly reserve the right in their
sole and absolute discretion, subject to applicable law, at any time and from
time to time, to:
o Delay the acceptance of the original capital securities for exchange;
o Terminate the exchange offer, whether or not any original
capital securities have been accepted for exchange, if Peoples
and PEBO Capital Trust I determine, in their sole and absolute
discretion, that any of the events or conditions referred to
under "--Conditions to the exchange offer" have occurred or
exist;
o Extend the expiration date of the exchange offer and retain
all original capital securities tendered under the exchange
offer, subject, however, to the right of holders of original
capital securities to withdraw their tendered original capital
securities as described under "--Withdrawal rights;" and
o Waive any condition or otherwise amend the terms of the exchange offer
in any respect.
If the exchange offer is amended in a manner we determine constitutes a
material change, or if we waive a material condition of the exchange offer, we
will promptly disclose that amendment by means of a prospectus supplement which
will be distributed to the registered holders of the original capital
securities, and we will extend the exchange offer to the extent required by Rule
14e-1 under the Exchange Act.
Any delay in acceptance, extension, termination or amendment will be
followed promptly by oral or written notice thereof to the exchange agent and by
making a public announcement thereof, and the announcement in the case of an
extension will be made no later than 9:00 a.m., New York City time, on the next
business day after the previously scheduled expiration date. Without limiting
the manner in which we may choose to make any public announcement and subject to
applicable law, we will have no obligation to publish, advertise or otherwise
communicate any public announcement other than by issuing a release to an
appropriate news agency.
Acceptance for exchange and issuance of new capital securities
Upon the terms and subject to the conditions of the exchange offer,
PEBO Capital Trust I will exchange, and will issue to the exchange agent, new
capital securities for original capital securities validly tendered and not
withdrawn promptly after the expiration date.
In all cases, delivery of new capital securities in exchange for
original capital securities tendered and accepted for exchange under the
exchange offer will be made only after timely receipt by the exchange agent of:
o Original capital securities or a book-entry confirmation of a
book-entry transfer of original capital securities into the
exchange agent's account at DTC, including an agent's message
if the tendering holder has not delivered a letter of
transmittal;
o The letter of transmittal, or facsimile thereof, properly
completed and duly executed, with any required signature
guarantees, or in the case of a book-entry transfer, an
agent's message in lieu of the letter of transmittal; and
o Any other documents required by the letter of transmittal.
The term "book-entry confirmation" means a timely confirmation of a
book-entry transfer of original capital securities into the exchange agent's
account at DTC. The term "agent's message" means a message, transmitted by DTC
to and received by the exchange agent and forming a part of a book-entry
confirmation, which states that DTC has received an express acknowledgment from
the tendering participant, which acknowledgment states that the participant has
received and agrees to be bound by the letter of transmittal and that PEBO
Capital Trust I and Peoples may enforce the letter of transmittal against the
participant.
Subject to the terms and conditions of the exchange offer, Peoples and
PEBO Capital Trust I will be deemed to have accepted for exchange, and thereby
exchanged, original capital securities validly tendered and not withdrawn as, if
and when PEBO Capital Trust I gives oral or written notice to the exchange agent
of Peoples' and PEBO Capital Trust I's acceptance of those original capital
securities for exchange under the exchange offer. The exchange agent will act as
agent for:
o PEBO Capital Trust I for the purpose of receiving tenders of
original capital securities, letters of transmittal and
related documents; and
o Tendering holders for the purpose of receiving original
capital securities, letters of transmittal and related
documents and transmitting new capital securities to validly
tendering holders.
The exchange will be made promptly after the expiration date. If, for
any reason whatsoever, acceptance for exchange or the exchange of any original
capital securities tendered under the exchange offer is delayed, whether before
or after PEBO Capital Trust I's acceptance for exchange of original capital
securities, or Peoples and PEBO Capital Trust I extend the exchange offer or are
unable to accept for exchange or exchange original capital securities tendered
under the exchange offer, then, without prejudice to Peoples' and PEBO Capital
Trust I's rights described in this prospectus, the exchange agent may,
nevertheless, on behalf of Peoples and PEBO Capital Trust I and subject to Rule
14e-1(c) under the Exchange Act, retain tendered original capital securities and
those original capital securities may not be withdrawn except to the extent
tendering holders are entitled to withdrawal rights as described under
"--Withdrawal rights."
Under the letter of transmittal, or agent's message in lieu thereof, a
holder of original capital securities will warrant and agree that:
o It has full power and authority to tender, exchange, sell, assign and
transfer original capital securities;
o PEBO Capital Trust I will acquire good, marketable and
unencumbered title to the tendered original capital
securities, free and clear of all liens, restrictions, charges
and encumbrances;
o Original capital securities tendered for exchange are not subject to
any adverse claims or proxies; and
o It will, upon request, execute and deliver any additional
documents deemed by Peoples, PEBO Capital Trust I or the
exchange agent to be necessary or desirable to complete the
exchange, sale, assignment and transfer of the original
capital securities tendered under the exchange offer.
Procedures for tendering original capital securities
Valid tender. Except as described below, in order for original capital
securities to be validly tendered under the exchange offer, a properly completed
and duly executed letter of transmittal with any required signature guarantees,
or in the case of a book-entry transfer, an agent's message in lieu of a letter
of transmittal, and any other required documents, must be received by the
exchange agent at one of its addresses given under "--Exchange agent." In
addition, one of the following must occur:
o Tendered original capital securities must be received by the exchange
agent;
o Original capital securities must be tendered under the
procedures for book-entry transfer described below and a
book-entry confirmation, including an agent's message if the
tendering holder has not delivered a letter of transmittal,
must be received by the exchange agent, in each case on or
prior to the expiration date; or
o The guaranteed delivery procedures described below must be complied
with.
If less than all of the original capital securities are tendered, a
tendering holder should fill in the amount of original capital securities being
tendered in the appropriate box on the letter of transmittal or so indicate in
an agent's message in lieu of the letter of transmittal. The untendered
liquidation amount must be $100,000 or any integral multiple of $1,000 in excess
of $100,000. The entire amount of original capital securities delivered to the
exchange agent will be deemed tendered unless otherwise indicated.
The method of delivery of certificates, the letter of transmittal and
all other required documents is at the option and sole risk of the tendering
holder. Delivery will be deemed made only when actually received by the exchange
agent. If delivery is by mail, registered mail, return-receipt requested,
properly insured, or an overnight delivery service is recommended. In all cases,
sufficient time should be allowed to ensure a timely delivery.
Book-entry transfer. The exchange agent will establish an account with
respect to the original capital securities at DTC for purposes of the exchange
offer within two business days after the date of this prospectus. Any financial
institution that is a participant in DTC's book-entry transfer facility system
may make a book-entry delivery of the original capital securities by causing DTC
to transfer the original capital securities into the exchange agent's account at
DTC in accordance with DTC's procedures for transfers. However, although
delivery of original capital securities may be effected through book-entry
transfer into the exchange agent's account at DTC, the properly completed and
duly executed letter of transmittal, with any required signature guarantees, or
an agent's message in lieu of the letter of transmittal, and any other required
documents, must in any case be delivered to and received by the exchange agent
on or prior to the expiration date, or the guaranteed delivery procedure
described below must be complied with.
Delivery of documents to DTC in accordance with DTC's procedures does
not constitute delivery to the exchange agent.
Signature guarantees. Certificates for original capital securities need
not be endorsed and signature guarantees on the letter of transmittal are
unnecessary unless a certificate for original capital securities is registered
in a name other than that of the person surrendering the certificate or the
holder completes the box entitled "Special Issuance Instructions" or "Special
Delivery Instructions" in the letter of transmittal. Those certificates for
original capital securities must be duly endorsed or accompanied by a properly
executed bond power, with the endorsement or signature on the bond power and on
the letter of transmittal guaranteed by a firm or other entity identified in
Rule 17Ad-15 under the Exchange Act as an "eligible guarantor institution,"
including (as these terms are defined in the Exchange Act):
o A bank;
o A broker, dealer, municipal securities broker or dealer or government
securities broker or dealer;
o A credit union;
o A national securities exchange, registered securities association or
clearing agency; or
o A savings association that is a participant in a Securities
Transfer Association, unless surrendered on behalf of the
eligible guarantor institution.
See Instruction 1 to the letter of transmittal.
Guaranteed delivery. If a holder desires to tender original capital
securities under the exchange offer and the certificate for those original
capital securities is not immediately available or time will not permit all
required documents to reach the exchange agent on or prior to the expiration
date, or the procedure for book-entry transfer cannot be completed on a timely
basis, those original capital securities may nevertheless be tendered, provided
that all of the following guaranteed delivery procedures are complied with:
o The tenders are made by or through an eligible guarantor institution;
o A properly completed and duly executed notice of guaranteed
delivery, substantially in the form accompanying the letter of
transmittal, is received by the exchange agent on or prior to
the expiration date; and
o The certificate, or a book-entry confirmation, representing
all tendered original capital securities, in proper form for
transfer, together with a properly completed and duly executed
letter of transmittal, or agent's message in lieu thereof,
with any required signature guarantees and any other documents
required by the letter of transmittal, are received by the
exchange agent within three New York Stock Exchange trading
days after the date of execution of the notice of guaranteed
delivery.
The notice of guaranteed delivery may be delivered by hand, or
transmitted by facsimile or mail, to the exchange agent and must include a
guarantee by an eligible guarantor institution in the form set forth in that
notice.
The delivery of new capital securities in exchange for original capital
securities tendered and accepted for exchange under the exchange offer will in
all cases be made only after timely receipt by the exchange agent of original
capital securities, or of a book-entry confirmation for the original capital
securities, and a properly completed and duly executed letter of transmittal, or
agent's message in lieu thereof, together with any required signature guarantees
and any other documents required by the letter of transmittal. Accordingly, the
delivery of new capital securities might not be made to all tendering holders at
the same time, and will depend upon when original capital securities, book-entry
confirmations for original capital securities and other required documents are
received by the exchange agent.
Peoples' and PEBO Capital Trust I's acceptance for exchange of original
capital securities tendered under any of the procedures described above will
constitute a binding agreement between the tendering holder, Peoples and PEBO
Capital Trust I upon the terms and subject to the conditions of the exchange
offer.
Determination of validity. All questions as to the form of documents,
validity, eligibility, including time of receipt, and acceptance for exchange of
any tendered original capital securities will be determined by Peoples and PEBO
Capital Trust I, in their sole discretion, whose determination will be final and
binding on all parties. Peoples and PEBO Capital Trust I reserve the absolute
right, in their sole and absolute discretion, to reject any and all tenders
determined by them not to be in proper form or the acceptance of which, or
exchange for, may, in the opinion of counsel to Peoples and PEBO Capital Trust
I, be unlawful. Peoples and PEBO Capital Trust I also reserve the absolute
right, subject to applicable law, to waive any of the conditions of the exchange
offer as described under "--Conditions to the exchange offer" or any condition
or irregularity in any tender of original capital securities of any particular
holder whether or not similar conditions or irregularities are waived in the
case of other holders.
The interpretation by Peoples and PEBO Capital Trust I of the terms and
conditions of the exchange offer, including the letter of transmittal and the
instructions thereto, will be final and binding. No tender of original capital
securities will be deemed to have been validly made until all irregularities
with respect to the tender have been cured or waived. None of Peoples, PEBO
Capital Trust I, any affiliates or assigns of Peoples or PEBO Capital Trust I,
the exchange agent or any other person will be under any duty to give any
notification of any irregularities in tenders or incur any liability for failure
to give any notification.
If any letter of transmittal, endorsement, bond power, power of
attorney or any other document required by the letter of transmittal is signed
by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative capacity,
that person should so indicate when signing, and unless waived by Peoples and
PEBO Capital Trust I, proper evidence satisfactory to Peoples and PEBO Capital
Trust I, in their sole discretion, of that person's authority to so act must be
submitted.
A beneficial owner of original capital securities that are held by or
registered in the name of a broker, dealer, commercial bank, trust company or
other nominee or custodian is urged to contact that entity promptly if the
beneficial holder wishes to participate in the exchange offer.
Resale of new capital securities
PEBO Capital Trust I is making the exchange offer for the new capital
securities in reliance on the position of the staff of the SEC's Division of
Corporation Finance taken in interpretative letters addressed to third parties
in other transactions. However, neither Peoples nor PEBO Capital Trust I sought
its own interpretive letter and there can be no assurance that the staff of the
SEC's Division of Corporation Finance would make a determination with respect to
this exchange offer similar to that made in the interpretive letters to third
parties. Based on these interpretations by the staff of the SEC's Division of
Corporation Finance, and subject to the two immediately following sentences,
Peoples and PEBO Capital Trust I believe that new capital securities issued
under this exchange offer in exchange for original capital securities may be
offered for resale, resold and otherwise transferred by the holder of the new
capital securities, other than a holder who is a broker-dealer, without further
compliance with the registration and prospectus delivery requirements of the
Securities Act, as long as the new capital securities are acquired in the
ordinary course of the holder's business and the holder is not participating,
and has no arrangement or understanding with any person to participate, in a
distribution, of the new capital securities. However, any holder of original
capital securities who is an affiliate of Peoples or PEBO Capital Trust I or who
intends to participate in the exchange offer for the purpose of distributing new
capital securities, or any broker-dealer who purchased original capital
securities from PEBO Capital Trust I to resell pursuant to Rule 144A or any
other available exemption under the Securities Act:
o Will not be able to rely on the interpretations of the staff
of the SEC's Division of Corporation Finance described in the
above-mentioned interpretive letters;
o Will not be permitted or entitled to tender original capital
securities in the exchange offer; and
o Must comply with the registration and prospectus delivery
requirements of the Securities Act in connection with any sale
or other transfer of original capital securities, unless that
sale or other transfer is made under an exemption from those
requirements.
In addition, as described below, broker-dealers that receive new
capital securities for their own accounts in exchange for original capital
securities must deliver a prospectus meeting the requirements of the Securities
Act when making any resales of new capital securities.
Each holder of original capital securities who wishes to exchange
original capital securities for new capital securities in the exchange offer
will be required to represent in the letter of transmittal that:
o It is not an affiliate of Peoples or PEBO Capital Trust I;
o Any new capital securities to be received by it are being acquired in
the ordinary course of its business;
o It has no arrangement or understanding with any person to participate
in a distribution of the new capital securities; and
o If the holder is not a broker-dealer, the holder is not
engaged in, and does not intend to engage in, a distribution
of those new capital securities.
In addition, we may require a holder of original capital securities, as
a condition to that holder's eligibility to participate in this exchange offer,
to furnish to us, or our agent, in writing information as to the number of
"beneficial owners", within the meaning of Rule 13d-3 under the Exchange Act, on
behalf of whom the holder holds the original capital securities to be exchanged
in the exchange offer.
Each broker-dealer participating in the exchange offer will be deemed
to have acknowledged by execution of the letter of transmittal, or delivery of
an agent's message, that it acquired the original capital securities for its own
account as the result of market-making activities or other trading activities.
The broker-dealer must also agree that it will deliver a prospectus meeting the
requirements of the Securities Act when making any resale of the new capital
securities. The letter of transmittal states that by so acknowledging and by
delivering a prospectus, a broker-dealer participating in the exchange offer
will not be deemed to admit that it is a "underwriter" within the meaning of the
Securities Act.
Based on the position taken by the staff of the SEC's Division of
Corporation Finance in the interpretive letters referred to above, Peoples and
PEBO Capital Trust I believe that broker-dealers participating in the exchange
offer who acquired original capital securities for their own accounts as a
result of market-making activities or other trading activities may fulfill their
prospectus delivery requirements for the new capital securities received upon
exchange of original capital securities, other than original capital securities
which represent an unsold allotment from the original sale of original capital
securities, with a prospectus meeting the requirements of the Securities Act.
That prospectus may be the prospectus prepared for an exchange offer if it
contains a description of the plan of distribution for the resale of the
securities received in exchange. Accordingly, this prospectus, as it may be
amended or supplemented from time to time, may be used by a broker-dealer
participating in the exchange offer during the period referred to below in
connection with resales of new capital securities received in exchange for
original capital securities, where the original capital securities were acquired
by the broker-dealer for its own account as a result of market-making or other
trading activities.
Subject to the terms of the registration rights agreement, we have
agreed that this prospectus, as it may be amended or supplemented from time to
time, may be used by a broker-dealer participating in the exchange offer, when
making resales of new capital securities for a period ending 90 days after the
expiration date, subject to extension under limited circumstances described
below. This period will end sooner if the broker-dealer disposes of all its new
capital securities. See "Plan of distribution." However, a broker-dealer who
intends to use this prospectus in connection with the resale of new capital
securities received in exchange for original capital securities must notify us,
on or prior to the expiration date, that it acquired its capital securities for
its own account as a result of market-making or other trading activities. The
notice may be given in the space provided for that purpose in the letter of
transmittal or may be delivered to the exchange agent. Any person, including a
broker-dealer, who is an affiliate of Peoples or PEBO Capital Trust I may not
rely on the SEC staff's interpretive letters and must comply with the
registration and prospectus delivery requirements of the Securities Act in any
resale transaction.
Each broker-dealer who surrenders original capital securities under the
exchange offer will be deemed to have agreed, by execution of the letter of
transmittal, or delivery of an agent's message in lieu thereof, that, upon
receipt of notice from Peoples or PEBO Capital Trust I of:
o the occurrence of any event or the discovery of any fact which
makes any statement contained or incorporated by reference in
this prospectus untrue in any material respect;
o the occurrence of any event or the discovery of any fact which
causes this prospectus to omit to state a material fact
necessary in order to make the statements contained or
incorporated by reference in this prospectus, in light of the
circumstances under which they were made, not misleading; or
o the occurrence of the other events specified in the registration
rights agreement,
the broker-dealer will suspend the sale of new capital securities under this
prospectus until Peoples and PEBO Capital Trust I have:
o amended or supplemented this prospectus to correct the
misstatement or omission and furnished copies of the amended
or supplemented prospectus to the broker-dealer; or
o given notice that the sale of the new capital securities may be resumed.
These same limitations would apply if the new guarantee or new debentures were
being sold.
If Peoples or PEBO Capital Trust I gives notice to suspend the sale of
new capital securities, that notice will extend the 90-day period referred to
above during which broker-dealers are entitled to use this prospectus in
connection with the resale of new capital securities. The period will be
extended by the number of days during the period from and including the date of
the giving of the notice to and including the date when broker-dealers have
received copies of the amended or supplemented prospectus necessary to permit
resales of the new capital securities or to and including the date on which
Peoples and PEBO Capital Trust I have given notice that the sale of new capital
securities may be resumed.
Withdrawal rights
Except as otherwise provided in this prospectus, tenders of original
capital securities may be withdrawn at any time on or prior to the expiration
date. In order for a withdrawal to be effective, a written or facsimile
transmission of the notice of withdrawal must be timely received by the exchange
agent on or prior to the expiration date. The notice of withdrawal must specify:
o The name of the person who tendered the original capital securities to
be withdrawn;
o The aggregate principal amount of original capital securities to be
withdrawn; and
o If a certificate for original capital securities has been
tendered, the name of the registered holder of the original
capital securities, if different from that of the person who
tendered the original capital securities.
If original capital securities have been delivered or otherwise
identified to the exchange agent, then prior to the physical release of those
withdrawn original capital securities, the tendering holder must submit the
certificate numbers shown on the particular original capital securities to be
withdrawn and the signature on the notice of withdrawal must be guaranteed by an
eligible guarantor institution, unless the original capital securities were
tendered for the account of an eligible guarantor institution. If original
capital securities have been tendered under the procedures for book-entry
transfer, the notice of withdrawal must specify the name and number of the
account at DTC to be credited with the withdrawal of original capital
securities, in which case a notice of withdrawal will be effective if delivered
to the exchange agent by written or facsimile transmission.
Withdrawals of tenders of original capital securities may not be
rescinded. Original capital securities properly withdrawn will not be deemed
validly tendered for purposes of the exchange offer, but may be retendered at
any subsequent time on or prior to the expiration date by following any of the
procedures described above under "--Procedures for tendering original capital
securities."
All questions as to the validity, form and eligibility, including time
of receipt, of withdrawal notices will be determined by Peoples and PEBO Capital
Trust I, in their sole discretion, whose determination will be final and binding
on all parties. None of Peoples, PEBO Capital Trust I, any affiliates or assigns
of Peoples or PEBO Capital Trust I, the exchange agent or any other person will
be under any duty to give any notification of any irregularities in any notice
of withdrawal or incur any liability for failure to give any notification. Any
original capital securities which have been tendered but which are withdrawn
will be returned to the holder promptly after withdrawal.
Distributions on new capital securities
Holders of new capital securities as of the applicable record date will
be entitled to receive distributions payable semi-annually in arrears on May 1
and November 1 of each year, commencing November 1, 1999. Those distributions
will accumulate from the later of the most recent distribution payment date to
which distributions have been duly paid or duly provided for under the new
capital securities or the original capital securities which were exchanged for
the new capital securities, or from April 20, 1999.
Conditions to the exchange offer
Peoples and PEBO Capital Trust I will not be required to accept for
exchange, or to exchange, any original capital securities for any new capital
securities, and may terminate the exchange offer, whether or not any original
capital securities have been accepted for exchange, or may waive any conditions
to or amend the exchange offer, if any of the following conditions have occurred
or exist:
o There has been a change in the current interpretation by the
staff of the SEC which permits the new capital securities
issued under the exchange offer in exchange for original
capital securities to be offered for resale, resold and
otherwise transferred by holders thereof, other than
broker-dealers and any holder which is an affiliate of Peoples
or PEBO Capital Trust I, without compliance with the
registration and prospectus delivery provisions of the
Securities Act as long as the new capital securities are
acquired in the ordinary course of the holders' business and
the holders have no arrangement or understanding with any
person to participate in the distribution of the new capital
securities;
o Any law, statute, rule or regulation has been adopted or
enacted which, in the judgment of Peoples or PEBO Capital
Trust I, would reasonably be expected to impair its ability to
proceed with the exchange offer;
o Any action or proceeding has been instituted or threatened in
any court or by or before any governmental agency or body with
respect to the exchange offer which, in Peoples' and PEBO
Capital Trust I's judgment, would reasonably be expected to
impair the ability of Peoples or PEBO Capital Trust I to
proceed with the exchange offer;
o A banking moratorium has been declared by United States
federal or Ohio or New York state authorities which, in
Peoples' and PEBO Capital Trust I's judgment, would reasonably
be expected to impair the ability of the Peoples or PEBO
Capital Trust I to proceed with the exchange offer;
o Trading on the New York Stock Exchange or generally in the
United States over-the-counter market has been suspended by
order of the SEC or any other governmental authority which, in
Peoples' and PEBO Capital Trust I's judgment, would reasonably
be expected to impair the ability of the Peoples or PEBO
Capital Trust I to proceed with the exchange offer; or
o A stop order has been issued by the SEC or any state
securities authority suspending the effectiveness of the
registration statement or proceedings have been initiated or,
to the knowledge of Peoples or PEBO Capital Trust I,
threatened for that purpose, or any governmental approval
which either Peoples or PEBO Capital Trust I, in its sole
discretion, deems necessary for the consummation of the
exchange offer as contemplated in this prospectus has not been
obtained.
If Peoples and PEBO Capital Trust I determine that any of the foregoing
events or conditions has occurred or exists, Peoples and PEBO Capital Trust I
may, subject to applicable law, terminate the exchange offer, whether or not any
original capital securities have been accepted for exchange, or waive any
condition or otherwise amend the terms of the exchange offer in any respect. If
that waiver or amendment constitutes a material change to the exchange offer,
Peoples and PEBO Capital Trust I will promptly disclose that waiver or amendment
by means of a prospectus supplement which will be distributed to the registered
holders of the original capital securities and will extend the exchange offer to
the extent required by Rule 14e-1 under the Exchange Act.
Exchange agent
Wilmington Trust Company has been appointed as exchange agent for the
exchange offer. Delivery of the letters of transmittal and any other required
documents, questions, requests for assistance, and requests for additional
copies of this prospectus or of the letter of transmittal should be directed to
the exchange agent as follows:
By Registered or By Hand or
Certified Mail Overnight Delivery
------------------------ ------------------------
Wilmington Trust Company Wilmington Trust Company
1100 North Market Street 1105 North Market Street
Wilmington, DE 19890-0001 Wilmington, DE 19890-0001
Attn: Kristin Long, Attn: Kristin Long,
Trust Operations Trust Operations
Confirm by telephone or for
information call:
(302) 651-1562
Facsimile Transmission
(Eligible Guarantor Institutions Only):
(302) 651-1079
Delivery to other than the above addresses or facsimile number will not
constitute a valid delivery.
Fees and expenses
Peoples has agreed to pay the exchange agent reasonable and customary
fees for its services and will reimburse it for its reasonable out-of-pocket
expenses in connection with the exchange offer. Peoples will also pay brokerage
houses and other custodians, nominees and fiduciaries the reasonable
out-of-pocket expenses incurred by them in forwarding copies of this prospectus
and related documents to the beneficial owners of original capital securities,
and in handling or tendering for their customers.
Holders who tender their original capital securities for exchange will
not be obligated to pay any transfer taxes in connection with the tender. If,
however, new capital securities are to be delivered to, or are to be issued in
the name of, any person other than the registered holder of the original capital
securities tendered, or if a transfer tax is imposed for any reason other than
the exchange of original capital securities in connection with the exchange
offer, then the amount of any transfer taxes, whether imposed on the registered
holder or any other person, will be payable by the tendering holder. If
satisfactory evidence of payment of those taxes or exemption therefrom is not
submitted with the letter of transmittal, the amount of those transfer taxes
will be billed directly to the tendering holder.
Neither Peoples nor PEBO Capital Trust I will make any payment to
brokers, dealers or other nominees soliciting acceptances of the exchange offer.
Description of new securities; Comparison to original securities
The terms of the new securities are identical in all material respects
to the terms of the original securities, except that:
o The original securities have not been registered under the
Securities Act, are subject to restrictions on transfer under
federal and state securities laws and are entitled to
specified rights under the registration rights agreement,
which rights will terminate upon consummation of the exchange
offer;
o The new capital securities will not contain the same
restrictions on transfer as the original capital securities.
Original capital securities will remain restricted securities
and may be resold only:
o to Peoples;
o to a qualified institutional buyer under Rule 144A under the Securities
Act;
o to an institutional accredited investor;
o in a transaction otherwise exempt from registration under the
Securities Act; or
o pursuant to an effective registration statement under the Securities
Act.
o The new capital securities will not provide for any increase in the
distribution rate; and
o The new debentures will not provide for any increase in the interest
rate.
The new securities are not, and upon consummation of the exchange offer
the original securities will not be, entitled to any additional interest or
distributions. Accordingly, holders of original capital securities should review
the information set forth under "Risk factors--If you are eligible to
participate in the exchange offer but do not exchange your original capital
securities, you will not have any exchange rights following the closing of the
exchange offer and your original capital securities will remain restricted
securities."
Description of capital securities
The original capital securities represent and the new capital
securities will represent beneficial interests in PEBO Capital Trust I. The
holders of capital securities will be entitled to a preference over the common
securities of PEBO Capital Trust I in specified circumstances with respect to
distributions and amounts payable on redemption of the securities of PEBO
Capital Trust I or liquidation of PEBO Capital Trust I. See "--Subordination of
common securities." Upon consummation of the exchange offer, the trust agreement
for PEBO Capital Trust I will be subject to and governed by Trust Indenture Act
of 1939. This summary of selected provisions of the capital securities, the
common securities and the trust agreement does not purport to be complete and is
subject to, and is qualified in its entirety by reference to, all the provisions
of the trust agreement, including the definitions therein of selected terms.
General
The capital securities, including the original capital securities and
the new capital securities, are limited to $30,000,000 aggregate liquidation
amount at any one time outstanding. The capital securities rank pari passu with
the common securities issued by PEBO Capital Trust I, and payments will be made
pro rata thereon, with the common securities, except as described under
"--Subordination of common securities." Legal title to the debentures issued to
PEBO Capital Trust I by Peoples will be held by the property trustee of PEBO
Capital Trust I in trust for the benefit of the holders of the capital
securities. Peoples' guarantee for the benefit of holders of capital securities
will not guarantee payment of distributions or amounts payable on redemption of
the capital securities or liquidation of PEBO Capital Trust I when PEBO Capital
Trust I does not have funds on hand legally available for those payments. See
"Description of guarantee by Peoples."
Distributions
Distributions on the capital securities will be cumulative, will
accumulate from April 20, 1999 and will be payable semi-annually in arrears on
May 1 and November 1 of each year, commencing November 1, 1999, at the annual
rate of 8.62% of the liquidation amount to the holders of the capital securities
on the relevant record dates. The record dates will be the 15th day of the month
immediately preceding the month in which the relevant payment occurs. The amount
of distributions payable for any period will be computed on the basis of a
360-day year of twelve 30-day months and, for any period of less than a full
calendar month, the number of days elapsed in such month. If any date on which
distributions are payable on the capital securities is not a business day,
payment of the distributions payable on that date will be made on the next
succeeding day that is a business day, with the same force and effect as if made
on the original scheduled distribution date. No interest or other payment will
be made due to the delay. A "business day" will be any day other than a Saturday
or a Sunday or a day on which banking institutions in New York, New York,
Wilmington, Delaware or Marietta, Ohio are authorized or required by law or
executive order to remain closed.
So long as no event of default exists under the debentures issued by
Peoples, Peoples will have the right to elect to defer the payment of interest
on the debentures, at any time or from time to time, for a period not exceeding
ten consecutive semi-annual periods in each extension period. No extension
period will end on a date other than an interest payment date or extend beyond
May 1, 2029. Upon any deferral election, semi-annual distributions on the
capital securities will be deferred during the extension period. Distributions
to which holders of the capital securities are entitled during any extension
period will accumulate additional distributions at the rate per annum of 8.62%,
compounded semi-annually from the relevant distribution date, to the extent
permitted by applicable law. The term "distributions," as used in this
prospectus, will include any additional distributions.
Prior to the termination of any extension period, Peoples may further
extend the extension period, provided the extension does not cause the extension
period to exceed ten consecutive semi-annual periods, to end on a date other
than an interest payment date or to extend beyond May 1, 2029. Upon the
termination of any extension period and the payment of all amounts then due on
any interest payment date, Peoples may elect to begin a new extension period,
subject to the above requirements. No interest will be due and payable until the
end of an extension period. Peoples must give the property trustee and
administrative trustees of PEBO Capital Trust I and the trustee under the
indenture notice of Peoples' election of an extension period, or an extension
thereof, at least five business days prior to the earlier of:
o The date the distributions on the capital securities would
have been payable except for the election to begin the
extension period;
o The date the property trustee is required to give notice to
any securities exchange or automated quotation system or to
holders of capital securities of the record date;
o The date distributions are payable; and
o The record date.
There is no limitation on the number of times that Peoples may elect to
begin an extension period. See "Description of debentures--Option to extend
interest payment date" and "Certain federal income tax consequences--Interest
income and original issue discount."
During any extension period, Peoples may not:
o Declare or pay any dividends or distributions on, or redeem,
purchase, acquire, or make a liquidation payment with respect
to, any of Peoples' capital stock;
o Make any payment of principal of or premium, if any, on or
repay, repurchase or redeem any debt securities of Peoples,
including any other junior subordinated debentures to be
issued by Peoples, that rank pari passu with or junior in
right of payment to the debentures issued to PEBO Capital
Trust I; or
o Make any guarantee payments under any guarantee by Peoples of
the debt securities of any subsidiary of Peoples, including
all other guarantees to be issued by Peoples, if the guarantee
ranks pari passu with or junior in right of payment to the
debentures issued to PEBO Capital Trust I.
These limitations do not apply to:
o Dividends or distributions in common shares of Peoples, or
options, warrants or rights to subscribe for or purchase
common shares of Peoples;
o Any declaration of a dividend in connection with the
implementation of a shareholder rights plan, or the issuance
of shares under any shareholder rights plan in the future, or
the redemption or repurchase of any rights under a shareholder
rights plan;
o Payments under Peoples' guarantee in favor of the holders of capital
securities;
o As a result of a reclassification of Peoples' capital stock or
the exchange or conversion of one class or series of Peoples'
capital stock for another class or series of Peoples' capital
stock;
o The purchase of fractional interests in shares of Peoples'
capital stock under the conversion or exchange provisions of
that capital stock or the security being converted or
exchanged or in a merger, consolidation or other business
combination; and
o Purchases of common shares related to the issuance of common
shares or rights under any of Peoples' benefit plans for
directors, officers or employees of Peoples and its
subsidiaries or Peoples' dividend reinvestment plan.
Peoples has no current intention to exercise its option to defer
payments of interest on the debentures issued to PEBO Capital Trust I.
The revenue of PEBO Capital Trust I available for distribution to
holders of the capital securities will be limited to payments under the
debentures issued by Peoples to PEBO Capital Trust I. See "Description of
debentures--General." If Peoples does not make interest payments on the
debentures, the property trustee of PEBO Capital Trust I will not have funds
available to pay distributions on the capital securities. The payment of
distributions is guaranteed by Peoples on a limited basis as described under
"Description of guarantee by Peoples."
Redemption
Upon the repayment on May 1, 2029 or prepayment, in whole or in part,
prior to May 1, 2029 of the debentures, other than following the distribution of
the debentures to the holders of the securities of PEBO Capital Trust I, the
proceeds from the repayment or prepayment will be applied by the property
trustee of PEBO Capital Trust I to redeem a like amount of the securities of
PEBO Capital Trust I. The property trustee must receive 45 days' prior written
notice of the repayment of the debentures. The securities of PEBO Capital Trust
I may be redeemed upon not less than 30 nor more than 60 days' notice of a date
of redemption. If less than all of the debentures are to be prepaid on a
redemption date, the debentures to be prepaid will be selected by the method
which the debenture trustee deems fair and appropriate. Peoples must receive any
required regulatory approval before prepaying any debentures.
The applicable redemption price will be equal to:
o The maturity redemption price -- equal to the principal of,
and accrued and unpaid interest on, the debentures, if the
debentures are repaid on May 1, 2029;
o The special event redemption price described in "Description
of debentures--Special event prepayment", if the debentures
are prepaid before May 1, 2009 upon the occurrence and
continuation of a special event; and
o The optional redemption price described in "Description of
debentures--Optional prepayment", if the debentures are
prepaid on or after May 1, 2009.
Peoples has the option to prepay the debentures:
o In whole or in part, on or after May 1, 2009, at the applicable
optional prepayment price; and
o In whole but not in part, at any time prior to May 1, 2009,
upon the occurrence of a special event, at the special event
prepayment price.
Liquidation of PEBO Capital Trust I and distribution of debentures
Peoples has the right at any time to dissolve PEBO Capital Trust I and,
after satisfaction of liabilities to creditors of PEBO Capital Trust I as
required by applicable law, to cause the debentures to be distributed to the
holders of the securities of PEBO Capital Trust I in liquidation. The right to
dissolve PEBO Capital Trust I is conditioned upon:
o Peoples having received an opinion of counsel to the effect
that the distribution will not be a taxable event to holders
of capital securities; and
o Receipt of any required regulatory approval.
PEBO Capital Trust I will automatically dissolve upon the first to
occur of:
o Specified events of bankruptcy, dissolution or liquidation of Peoples;
o The distribution of a like amount of the debentures to the
holders of the securities of PEBO Capital Trust I, if Peoples,
as sponsor, has given written direction to the property
trustee of PEBO Capital Trust I to dissolve PEBO Capital Trust
I;
o Redemption of all of the securities of PEBO Capital Trust I;
o Expiration of the term of PEBO Capital Trust I; and
o The entry of an order for the dissolution of PEBO Capital Trust I
by a court of competent jurisdiction.
If a dissolution occurs other than as the result of a court order, PEBO
Capital Trust I will be liquidated by its trustees as expeditiously as the
trustees determine to be possible by distributing, after satisfaction of
liabilities to creditors of PEBO Capital Trust I as provided by applicable law,
to the holders of the capital securities a like amount of the debentures issued
by Peoples. However, if the property trustee determines the distribution is not
practicable, the holders of capital securities will be entitled to receive out
of the assets of PEBO Capital Trust I legally available for distribution to
holders, after satisfaction of liabilities to creditors of PEBO Capital Trust I
as provided by applicable law, an amount equal to the aggregate of the
liquidation amount plus accumulated and unpaid distributions thereon to the date
of payment (this amount being the "liquidation distribution"). If the
liquidation distribution can be paid only in part because PEBO Capital Trust I
has insufficient assets on hand legally available to pay in full the aggregate
liquidation distribution, then the amounts payable directly by PEBO Capital
Trust I on the capital securities will be paid on a pro rata basis, except that
if an event of default has occurred and is continuing under the indenture
related to debentures, the capital securities will have a priority over the
common securities. See "--Subordination of common securities."
If Peoples elects not to prepay the debentures prior to maturity and
either elects not to or is unable to liquidate PEBO Capital Trust I and
distribute the debentures to holders of the capital securities, the capital
securities will remain outstanding until the repayment of the debentures on May
1, 2029.
After the liquidation date is fixed for any distribution of debentures
to holders of the capital securities:
o The capital securities will no longer be deemed to be outstanding;
o DTC or its nominee will receive, in respect of each registered
global certificate, if any, representing capital securities
held by it, a registered global certificate or certificates
representing the debentures to be delivered upon the
distribution; and
o Any certificates representing capital securities not held by
DTC or its nominee will be deemed to represent debentures
having a principal amount equal to the liquidation amount of
the capital securities, and bearing accrued and unpaid
interest in an amount equal to the accumulated and unpaid
distributions on the capital securities until the certificates
are presented to the administrative trustees of PEBO Capital
Trust I or their agent for cancellation. At that time, Peoples
will issue to the holder, and the debenture trustee will
authenticate, a certificate representing the debentures.
There can be no assurance as to the market prices for the capital
securities or the debentures that may be distributed in exchange for the capital
securities if a dissolution and liquidation of PEBO Capital Trust I were to
occur. Accordingly, capital securities held by an investor, or debentures that
an investor may receive on dissolution and liquidation of PEBO Capital Trust I,
may trade at a discount to the price the investor paid to purchase the capital
securities.
Redemption procedures
Capital securities will be redeemed at the applicable redemption price
with the proceeds from the contemporaneous repayment or prepayment of the
debentures issued by Peoples. Any redemption of capital securities will be made
and the applicable redemption price will be payable on the redemption date only
to the extent that PEBO Capital Trust I has funds legally available for the
payment of the applicable redemption price. See also "--Subordination of common
securities."
If PEBO Capital Trust I gives a notice of redemption in respect of the
capital securities, then, by 12:00 noon, New York City time, on the redemption
date, to the extent funds are legally available:
o The property trustee will deposit or cause the paying agent to
deposit irrevocably with DTC funds sufficient to pay the
applicable redemption price for the capital securities held by
DTC or its nominee; and
o The property trustee will irrevocably deposit with the paying
agent funds sufficient to pay the applicable redemption price,
and give the paying agent irrevocable instructions and
authority to pay the applicable redemption price, to the
holders of capital securities held in certificated form upon
surrender of their certificates.
See "--Payment and paying agent."
Distributions payable on or prior to the redemption date will be
payable to the holders of capital securities on the relevant record dates for
the related distribution dates. If notice of redemption has been given and funds
deposited as required, then upon the date of deposit, all rights of the holders
of the capital securities called for redemption will cease, except the right of
the holders of capital securities to receive the applicable redemption price,
but without interest on that redemption price, and those capital securities will
cease to be outstanding. If any redemption date of capital securities is not a
business day, then the applicable redemption price payable on that date will be
paid on the next succeeding day that is a business day. No interest or other
payment will be made in respect of any delay.
If payment of the applicable redemption price is improperly withheld or
refused and not paid either by PEBO Capital Trust I or by Peoples under its
guarantee:
o Distributions on capital securities will continue to
accumulate at the then applicable rate, from the redemption
date originally established by PEBO Capital Trust I to the
date the applicable redemption price is actually paid; and
o The actual payment date will be the redemption date for
purposes of calculating the applicable redemption price.
Notice of any redemption will be mailed at least 30 days but not more
than 60 days prior to the redemption date to each holder of capital securities
at its registered address. Unless PEBO Capital Trust I defaults in payment of
the applicable redemption price on its securities, or Peoples defaults in the
repayment of the debentures, on and after the redemption date, distributions
will cease to accrue on the capital securities called for redemption.
Subject to applicable law, including federal securities laws, Peoples
or its subsidiaries may at any time and from time to time purchase outstanding
capital securities by tender, in the open market or by private agreement.
Subordination of common securities
Payment of distributions on, and the redemption price of, the capital
securities will be made pro rata based on the liquidation amount of the capital
securities. However, if on any distribution date or redemption date an event of
default exists under the indenture related to Peoples' debentures, no payment of
any distribution on, or redemption price of, any of the common securities, and
no other payment on account of the redemption, liquidation or other acquisition
of the common securities, will be made unless a cash payment in full of all
accumulated and unpaid distributions on all of the outstanding capital
securities for all distribution periods terminating on or prior thereto, or in
the case of payment of the applicable redemption price the full amount of the
redemption price, has been made or provided for. All funds available to the
property trustee of PEBO Capital Trust I will first be applied to the payment in
full in cash of all distributions on, or redemption price of, the capital
securities then due and payable.
In the case of any event of default under the trust agreement for PEBO
Capital Trust I, Peoples, as holder of the common securities, will be deemed to
have waived any right to act with respect to the event of default until the
effect of the event of default has been cured, waived or otherwise eliminated.
Until an event of default has been so cured, waived or otherwise eliminated, the
property trustee will act solely on behalf of the holders of the capital
securities and not on behalf of Peoples as holder of the common securities, and
only the holders of the capital securities will have the right to direct the
property trustee to act on their behalf.
Events of default; Notice
The occurrence of an event of default under the indenture related to
the debentures constitutes an "event of default" under the trust agreement for
PEBO Capital Trust I. See "Description of debentures-Debenture events of
default."
Within ten business days after the occurrence of any event of default
actually known to the property trustee, the property trustee will transmit
notice of the event of default to the holders of the capital securities, the
administrative trustees of PEBO Capital Trust I and Peoples, as sponsor, unless
the event of default has been cured or waived. Peoples, as sponsor, and the
administrative trustees of PEBO Capital Trust I are required to file annually
with the property trustee a certificate as to whether or not they are in
compliance with all the conditions and covenants applicable to them under the
trust agreement.
If an event of default under the indenture has occurred and is
continuing, the capital securities will have a preference over the common
securities as described under "--Liquidation of PEBO Capital Trust I and
distribution of debentures" and "--Subordination of common securities."
Removal of trustees of PEBO Capital Trust I
Unless an event of default has occurred and is continuing under the
indenture related to the debentures, any trustee of PEBO Capital Trust I may be
removed at any time by the holder of the common securities. If an event of
default under the indenture has occurred and is continuing, the property trustee
and the Delaware trustee of PEBO Capital Trust I may be removed at that time by
the holders of a majority in liquidation amount of the outstanding capital
securities. The holders of the capital securities will have no right to vote to
appoint, remove or replace the administrative trustees. Those voting rights are
vested exclusively in Peoples as the holder of the common securities. No
resignation or removal of a trustee of PEBO Capital Trust I and no appointment
of a successor trustee will be effective until the acceptance of appointment by
the successor trustee under the provisions of the trust agreement.
Merger, consolidation or conversion of trustees of PEBO Capital Trust I
Any person into which the property trustee, the Delaware trustee or any
administrative trustee that is not a natural person may be merged or converted
or with which it may be consolidated, or any person resulting from any merger,
conversion or consolidation to which a trustee is a party, or any person
succeeding to all or substantially all the corporate trust business of a
trustee, will be the successor of the trustee under the trust agreement for PEBO
Capital Trust I, as long as that person is otherwise qualified and eligible.
Mergers, consolidations, conversions, amalgamations or replacements of PEBO
Capital Trust I
PEBO Capital Trust I may not merge with or into, convert into,
consolidate, amalgamate or be replaced by, or convey, transfer or lease its
properties and assets as an entirety or substantially as an entirety to any
corporation or other person, except as described below or as otherwise described
under "--Liquidation of PEBO Capital Trust I and distribution of debentures."
PEBO Capital Trust I may, at the request of Peoples, as sponsor, with the
consent of the individual administrative trustees, but without the consent of
the holders of the capital securities, merge with or into, convert into,
consolidate, amalgamate or be replaced by or convey, transfer or lease its
properties and assets as an entirety or substantially as an entirety to a trust
organized as such under the laws of any state. Prior to the consummation of any
of these transactions, the following must occur:
o The successor entity either
o expressly assumes all of the obligations of PEBO Capital Trust I
under its securities; or
o substitutes for the capital and common securities of
PEBO Capital Trust I other securities having
substantially the same terms as the capital and
common securities so long as the successor securities
rank the same as the capital and common securities
rank in priority with respect to distributions and
payments upon liquidation, redemption and otherwise;
o Peoples expressly appoints a trustee of the successor entity
possessing the same powers and duties as the property trustee
of PEBO Capital Trust I with respect to the debentures;
o The successor securities are listed, or any successor
securities will be listed upon notification of issuance, on
any national securities exchange or other organization on
which the capital and common securities are then listed or
quoted;
o If the capital securities, including any successor securities,
are rated by any nationally recognized statistical rating
organization prior to the transaction, the merger, conversion,
consolidation, amalgamation, replacement, conveyance, transfer
or lease does not cause the capital securities, including any
successor securities, or, if the debentures are so rated, the
debentures, to be downgraded by any nationally recognized
statistical rating organization;
o The merger, conversion, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not adversely
affect the rights, preferences and privileges of the holders
of the capital and common securities, including any successor
securities, in any material respect;
o The successor entity has a purpose substantially identical to that of
PEBO Capital Trust I;
o Prior to the merger, conversion, consolidation, amalgamation,
replacement, conveyance, transfer or lease, Peoples has
received an opinion from independent counsel to PEBO Capital
Trust I experienced in those matters to the effect that:
o the merger, conversion, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not
adversely affect the rights, preferences and
privileges of the holders of capital and common
securities, including any successor securities, in
any material respect, other than any dilution of the
holders' interests in the new entity; and
o following the merger, conversion, consolidation,
amalgamation, replacement, conveyance, transfer or
lease, neither PEBO Capital Trust I nor the successor
entity will be required to register as an investment
company under the Investment Company Act; and
o Peoples or any permitted successor or assignee owns all of the
common securities of the successor entity and guarantees the
obligations of the successor entity under the successor
securities at least to the extent provided by the guarantees
by Peoples for the benefit of the holders of capital
securities and the holders of common guarantee securities.
Notwithstanding the foregoing, PEBO Capital Trust I will not, except with the
consent of holders of 100% in liquidation amount of the capital and common
securities, consolidate, amalgamate, merge with or into, convert into or be
replaced by or convey, transfer or lease its properties and assets as an
entirety or substantially as an entirety to, any other entity or permit any
other entity to consolidate, amalgamate, merge with or into, convert into or
replace it if that consolidation, amalgamation, merger, conversion, replacement,
conveyance, transfer or lease would cause PEBO Capital Trust I or the successor
entity not to be classified as a grantor trust for United States federal income
tax purposes.
Voting rights; Amendment of the trust agreement
Except as provided below and under "--Mergers, consolidations,
conversions, amalgamations or replacements of PEBO Capital Trust I" and
"Description of guarantee by Peoples--Amendments and assignment" and as
otherwise required by law and the trust agreement for PEBO Capital Trust I, the
holders of the capital securities will have no voting rights.
The trust agreement for PEBO Capital Trust I may be amended from time
to time by Peoples, the property trustee and the administrative trustees of PEBO
Capital Trust I, without the consent of the holders of capital and common
securities, to:
o Cure any ambiguity, correct or supplement any provisions in
the trust agreement that may be inconsistent with any other
provision, or make any other provisions with respect to
matters or questions arising under the trust agreement, which
will not be inconsistent with the other provisions of the
trust agreement;
o Modify, eliminate or add to any provisions of the trust
agreement necessary to ensure that PEBO Capital Trust I will
be classified for United States federal income tax purposes as
a grantor trust at all times that any capital securities are
outstanding or to ensure that PEBO Capital Trust I will not be
required to register as an "investment company" under the
Investment Company Act; or
o Modify, eliminate or add any provisions of the trust agreement
necessary to enable Peoples or PEBO Capital Trust I to conduct
an exchange offer in a manner contemplated by the registration
rights agreement.
Amendments described in the first and third bullets must not adversely affect in
any material respect the interests of the holders of the capital securities. Any
amendments of the trust agreement will become effective when notice thereof is
given to the holders of the capital securities.
The trust agreement for PEBO Capital Trust I may be amended by the
trustees and Peoples:
o With the consent of holders representing a majority in liquidation
amount of the outstanding capital securities; and
o Upon receipt by the trustees of an opinion of counsel
experienced in those matters to the effect that the amendment
or the exercise of any power granted to the trustees in
accordance with the amendment will not affect PEBO Capital
Trust I's status as a grantor trust for United States federal
income tax purposes or PEBO Capital Trust I's exemption from
status as an "investment company" under the Investment Company
Act.
However, without the consent of each holder of capital securities, the trust
agreement may not be amended to:
o Change the amount or timing of any distribution on the capital
and common securities or otherwise adversely affect the amount
of any distribution required to be made in respect of the
capital and common securities as of a specified date; or
o Restrict the right of a holder of capital securities to
institute suit for the enforcement of any payment on or after
the amendment date.
So long as any debentures are held by the property trustee of PEBO
Capital Trust I, the trustees of PEBO Capital Trust I will not:
o Direct the time, method and place of conducting any proceeding
for any remedy available to the debenture trustee or execute
any trust or power conferred on the debenture trustee with
respect to the debentures;
o Waive specified past defaults under the indenture related to the
debentures;
o Exercise any right to rescind or annul a declaration of acceleration
of the maturity of the principal of the debentures; or
o Consent to any amendment, modification or termination of the
indenture related to the debentures or the debentures, where
that consent is required, without, in each case, obtaining the
prior approval of the holders of a majority in liquidation
amount of all outstanding capital securities.
However, where a consent under the indenture would require the consent of each
holder of debentures affected thereby, no consent will be given by the property
trustee of PEBO Capital Trust I without the prior approval of each holder of the
capital securities. The trustees of PEBO Capital Trust I will not revoke any
action previously authorized or approved by a vote of the holders of the capital
securities, except by subsequent vote of those holders. The property trustee
will notify each holder of capital securities of any notice of default with
respect to the debentures. In addition to obtaining the foregoing approvals of
holders of the capital securities, prior to taking any of the foregoing actions,
the trustees of PEBO Capital Trust I will obtain an opinion of counsel
experienced in those matters to the effect that PEBO Capital Trust I will
continue to qualify as a grantor trust.
Any required approval of holders of capital securities may be given at
a meeting of those holders convened for that purpose or pursuant to written
consent. The property trustee of PEBO Capital Trust I will cause a notice of any
meeting at which holders of capital securities are entitled to vote, or of any
matter upon which action by written consent of holders has been taken, to be
given to each holder of record of capital securities in the manner described in
the trust agreement.
No vote or consent of the holders of capital securities will be
required for PEBO Capital Trust I to redeem and cancel the capital securities in
accordance with the trust agreement.
Notwithstanding that holders of the capital securities are entitled to
vote or consent under any of the circumstances described above, any of the
capital securities that are owned by Peoples, the trustees of PEBO Capital Trust
I or any affiliate of Peoples or any trustee of PEBO Capital Trust I, will, for
purposes of the vote or consent, be treated as if they were not outstanding.
Form, denomination, book-entry procedures and transfer
The new capital securities may be issued in certificated form or as one
or more capital securities in registered, global form. Upon issuance, the global
capital securities will be deposited with the property trustee of PEBO Capital
Trust I as custodian for DTC, in New York, New York, and registered in the name
of DTC or its nominee, in each case for credit to an account of a direct or
indirect participant in DTC as described below.
If capital securities are issued in certificated form, the capital
securities will be issued in blocks having a liquidation amount of not less than
$100,000 (100 capital securities) and may be transferred or exchanged only in
such blocks in the manner and at the offices described below.
Except as described below, the global capital securities may be
transferred, in whole and not in part, only to another nominee of DTC or to a
successor of DTC or its nominee and only in amounts that would not cause a
holder to own less than 100 capital securities. Beneficial interests in the
global capital securities may not be exchanged for capital securities in
certificated form, except in the limited circumstances described below. See
"--Exchange of book-entry capital securities for certificated capital
securities."
Other capital securities may be issued only in registered, certificated
(i.e., non-global) form. These capital securities may not be exchanged for
beneficial interests in any global capital securities, except in the limited
circumstances described below. See "--Exchange of certificated capital
securities for book-entry capital securities."
Transfer of beneficial interests in the global capital securities will
be subject to the applicable rules and procedures of DTC and its direct or
indirect participants, which may change from time to time.
Depositary procedures
DTC has advised PEBO Capital Trust I and Peoples that DTC is a
limited-purpose trust company organized under the laws of the State of New York,
a member of the Federal Reserve System, a "clearing corporation" within the
meaning of the Uniform Commercial Code and a "clearing agency" registered under
the provisions of Section 17A of the Exchange Act. DTC was created to hold
securities for its participating organizations and to facilitate the clearance
and settlement of transactions in those securities between DTC participants
through electronic book-entry changes in accounts of DTC participants, thereby
eliminating the need for physical movement of certificates. DTC participants
include securities brokers and dealers, banks, trust companies, clearing
corporations and similar organizations. Indirect access to DTC's system is also
available to other entities such as banks, brokers, dealers and trust companies
that clear through or maintain a custodial relationship with a DTC participant,
either directly or indirectly. Persons who are not DTC participants may
beneficially own securities held by or on behalf of DTC only through the DTC
participants or indirect participants. The ownership interest and transfer of
ownership interest of each actual purchaser of each security held by or on
behalf of DTC are recorded on the records of the participants and indirect
participants in DTC.
DTC has also advised PEBO Capital Trust I and Peoples that, under
procedures established by DTC:
o Upon deposit of the global capital securities, DTC will credit
the accounts of DTC participants exchanging original capital
securities represented by global capital securities with
portions of the liquidation amount of the global capital
securities; and
o Ownership of those interests in the global capital securities
will be shown on, and the transfer of ownership thereof will
be effected only through, records maintained by DTC for DTC
participants or by DTC participants and indirect participants
for other owners of beneficial interests in the global capital
securities.
Investors in the global capital securities may hold their interests
therein directly through DTC if they are DTC participants, or indirectly through
organizations that are DTC participants. All interests in a global capital
security will be subject to the procedures and requirements of DTC.
The laws of some states require that specified persons take physical
delivery in certificated form of securities that they own. Consequently, the
ability to transfer beneficial interests in a global capital security to those
persons will be limited to that extent. Because DTC can act only on behalf of
participants, which in turn act on behalf of indirect participants and certain
banks, the ability of a person having beneficial interests in a global capital
security to pledge those interests to persons or entities that do not
participate in the DTC system, or otherwise take actions in respect of those
interests, may be affected by the lack of a physical certificate evidencing
those interests.
Other restrictions on the transferability of the capital securities are
described in "--Exchange of book-entry capital securities for certificated
capital securities" and "--Exchange of certificated capital securities for
book-entry capital securities."
Except as described below, owners of interests in the global capital
securities will not have capital securities registered in their name, will not
receive physical delivery of capital securities in certificated form and will
not be considered the registered owners or holders of capital securities under
the trust agreement for PEBO Capital Trust I for any purpose.
Payments in respect of the global capital security registered in the
name of DTC, or its nominee, will be payable by the property trustee of PEBO
Capital Trust I to DTC in its capacity as the registered holder under the trust
agreement. Under the terms of the trust agreement, the property trustee will
treat the persons in whose names the capital securities, including the global
capital securities, are registered as the owners thereof for the purpose of
receiving payments and for any and all other purposes whatsoever. Consequently,
neither the property trustee nor any agent of the property trustee has or will
have any responsibility or liability for:
o Any aspect of the records of DTC or any DTC participant or
indirect participant relating to or payments made on account
of beneficial ownership interests in the global capital
securities;
o Maintaining, supervising or reviewing any of the records of
DTC or any DTC participant or indirect participant relating to
the beneficial ownership interests in the global capital
securities; or
o Any other matter relating to the actions and practices of
DTC or any of its participants or indirect participants.
DTC has advised PEBO Capital Trust I and Peoples that its current
practice, upon receipt of any payment in respect of securities such as the
capital securities, is to credit the accounts of the relevant DTC participants
with the payment on the payment date, in amounts proportionate to their
respective holdings in liquidation amount of beneficial interests in the
relevant security as shown on the records of DTC unless DTC has reason to
believe it will not receive payment on the payment date. Payments by DTC
participants and indirect participants to the beneficial owners of capital
securities will be governed by standing instructions and customary practices and
will be the responsibility of DTC participants or indirect participants and will
not be the responsibility of DTC, the property trustee, PEBO Capital Trust I or
Peoples. None of PEBO Capital Trust I, Peoples or the property trustee will be
liable for any delay by DTC or any of its participants in identifying the
beneficial owners of the capital securities. PEBO Capital Trust I, Peoples and
the property trustee may conclusively rely on and will be protected in relying
on instructions from DTC or its nominee for all purposes.
Secondary market trading activity in interests in the global capital
securities will settle in immediately available funds, subject in all cases to
the rules and procedures of DTC and its participants. Transfers between
participants in DTC will be effected in accordance with DTC's procedures, and
will settle in same-day funds.
DTC has advised PEBO Capital Trust I and Peoples that DTC will take any
action permitted to be taken by a holder of capital securities, including the
presentation of capital securities for exchange as described below, only at the
direction of one or more DTC participants to whose DTC account interests in the
global capital securities are credited and only in respect of the portion of the
liquidation amount of the capital securities as to which the DTC participant or
participants has or have given such direction. However, if there is an event of
default under trust agreement for PEBO Capital Trust I, DTC reserves the right
to exchange the global capital securities for legended capital securities in
certificated form and to distribute those capital securities to its
participants.
The information in this section concerning DTC and its book-entry
system has been obtained from sources that PEBO Capital Trust I and Peoples
believe to be reliable, but neither PEBO Capital Trust I nor Peoples takes
responsibility for the accuracy thereof.
Although DTC has agreed to the foregoing procedures to facilitate
transfers of interest in the global capital securities among participants in
DTC, it is under no obligation to perform or to continue to perform those
procedures, and the procedures may be discontinued at any time. None of PEBO
Capital Trust I, Peoples or the property trustee will have any responsibility
for the performance by DTC, or its participants or indirect participants, of its
obligations under the rules and procedures governing DTC's operations.
Exchange of book-entry capital securities for certificated capital securities
A global capital security is exchangeable for capital securities in
registered certificated form if:
o DTC:
o notifies PEBO Capital Trust I that it is unwilling or
unable to continue as depositary for the global
capital security and PEBO Capital Trust I thereupon
fails to appoint a successor depositary within 90
days or
o has ceased to be a clearing agency registered under the
Exchange Act,
o and PEBO Capital Trust I thereupon fails to appoint a
successor depositary within 90 days;
o Peoples in its sole discretion elects to cause the issuance of the
capital securities in certificated form; or
o There has occurred and is continuing an event of default under
the trust agreement for PEBO Capital Trust I or any event
which after notice or lapse of time or both would be an event
of default under the trust agreement.
In addition, beneficial interests in a global capital security may be
exchanged by or on behalf of DTC for certificated capital securities upon
request by DTC, but only upon at least 20 days' prior written notice given to
the property trustee in accordance with DTC's customary procedures. In all
cases, certificated capital securities delivered in exchange for any global
capital security or beneficial interests therein will be registered in the
names, and issued in any approved denominations, requested by or on behalf of
the depositary, in accordance with its customary procedures. Exchange of
certificated capital securities for book-entry capital securities
Certificated capital securities may not be exchanged for beneficial
interests in any global capital security, unless the exchange occurs in
connection with a transfer of the certificated capital securities and the
transferor first delivers to the property trustee of PEBO Capital Trust I a
written certificate, in the form provided in the trust agreement, to the effect
that the transfer will comply with the appropriate transfer restrictions
applicable to those capital securities.
Payment and paying agent
Payments in respect of the capital securities held in global form will
be made to the depositary, which will credit the relevant accounts at the
depositary on the applicable distribution dates, or in respect of the capital
securities that are not held by the depositary, the payments will be made by
check mailed to the address of the holder entitled thereto as the address
appears on the register. The paying agent will initially be the property trustee
of PEBO Capital Trust I and any co-paying agent chosen by the property trustee
and acceptable to the administrative trustees of PEBO Capital Trust I and
Peoples. The paying agent will be permitted to resign as paying agent upon 30
days' notice to the property trustee, the administrative trustees and Peoples.
If the property trustee is no longer the paying agent, the administrative
trustees will appoint a successor, which must be a bank or trust company
acceptable to the administrative trustees and Peoples, to act as paying agent.
Restrictions on transfer
The capital securities may be transferred only in blocks having a
liquidation amount of not less than $100,000 (100 capital securities) and
multiples of $1,000 in excess of $100,000. Any attempted sale, transfer or other
disposition of capital securities in a block having a liquidation amount of less
than $100,000 will be void and of no legal effect whatsoever. Any purported
transferee will not be the holder of those capital securities for any purpose,
including the receipt of distributions on those capital securities. The
purported transferee will have no interest whatsoever in those capital
securities.
Registrar and transfer agent
The property trustee will act as registrar and transfer agent for the
capital securities.
Registration of transfers of the capital securities will be effected
without charge by or on behalf of PEBO Capital Trust I, but upon payment of any
tax or other governmental charges that may be imposed in connection with any
transfer or exchange. PEBO Capital Trust I will not be required to register, or
cause to be registered, the transfer of the capital securities after they have
been called for redemption.
Information concerning the property trustee
Other than during the occurrence and continuance of an event of default
under the trust agreement, the property trustee will undertake to perform only
the duties specifically described in the trust agreement and, during the
existence of an event of default, must exercise the same degree of care and
skill as a prudent person would exercise or use in the conduct of his or her own
affairs. Subject to this provision, the property trustee is under no obligation
to exercise any of the powers vested in it by the trust agreement at the request
of any holder of capital securities, unless it is offered reasonable indemnity
against the costs, expenses and liabilities that might be incurred thereby. If
no event of default under the trust agreement has occurred and is continuing and
the property trustee is required to decide between alternative causes of action,
construe ambiguous provisions in the trust agreement or is unsure of the
application of any provision of the trust agreement, and the matter is not one
on which holders of the capital securities or the common securities are entitled
to vote, then the property trustee:
o Will take the action directed by Peoples and, if not so
directed, will take the action it deems advisable and in the
best interests of the holders of capital and common
securities; and
o Will have no liability, except for its own bad faith, negligence or
willful misconduct.
Miscellaneous
The administrative trustees are authorized and directed to conduct the
affairs of and to operate PEBO Capital Trust I in such a way that:
o PEBO Capital Trust I will not be deemed to be an "investment
company" required to be registered under the Investment
Company Act
o PEBO Capital Trust I will be classified as a grantor trust for United
States federal income tax purposes; and
o The debentures will be treated as indebtedness of Peoples for
United States federal income tax purposes.
Peoples and the administrative trustees are authorized to take any action, not
inconsistent with applicable law, the certificate of trust of PEBO Capital Trust
I or the trust agreement, that Peoples and the administrative trustees determine
in their discretion to be necessary or desirable for these purposes, as long as
the action does not materially adversely affect the interests of the holders of
the capital and common securities.
Holders of capital and common securities have no preemptive or similar
rights to subscribe for any additional capital and common securities. In
addition, the issuance of capital and common securities is not subject to
preemptive rights.
PEBO Capital Trust I may not borrow money, issue debt, execute
mortgages or pledge any of its assets.
Description of debentures
The original debentures were, and the new debentures will be, issued
under an indenture between Peoples and the debenture trustee. Upon effectiveness
of the registration statement of which this prospectus is a part, the indenture
will be qualified under the Trust Indenture Act. This summary of selected terms
and provisions of the debentures and the indenture does not purport to be
complete, and where reference is made to particular provisions of the indenture,
those provisions, including the definitions of selected terms, some of which are
not otherwise defined in this prospectus, are qualified in their entirety by
reference to all of the provisions of the indenture and those terms made a part
of the indenture by the Trust Indenture Act.
General
Concurrently with the issuance of the capital securities, PEBO Capital
Trust I invested the proceeds of the capital securities, together with the
consideration paid by Peoples for the common securities, in debentures issued by
Peoples. The debentures bear interest from April 20, 1999 at the annual rate of
8.62% of the principal amount thereof, payable semi-annually in arrears on May 1
and November 1 of each year, commencing November 1, 1999. The record dates will
be the 15th day of the month immediately preceding the month in which the
relevant payment occurs. It is anticipated that, until the liquidation of PEBO
Capital Trust I, the debentures will be held in the name of the property trustee
in trust for the benefit of the holders of capital and common securities. The
amount of interest payable for any period will be computed on the basis of a
360-day year of twelve 30-day months and, for any period of less than a full
calendar month, the number of days elapsed in the month. If any date on which
interest is payable on the debentures is not a business day, then payment of the
interest payable on that date will be made on the next succeeding day that is a
business day with the same force and effect as if made on the scheduled interest
payment date. No interest or other payment will be payable due to the delay.
Accrued interest that is not paid on the applicable interest payment date will
bear additional interest on the amount thereof, to the extent permitted by law,
at the rate per annum of 8.62%, compounded semi-annually. The term "interest"
includes semi-annual interest payments, interest on semi-annual interest
payments not paid on the applicable interest payment date and additional sums,
as applicable. Please see the discussion of additional sums under "--Special
event prepayment."
The debentures will mature on May 1, 2029.
The debentures will rank pari passu with all other junior subordinated
debentures to be issued by Peoples and are unsecured and rank subordinate and
junior in right of payment to all senior indebtedness to the extent and in the
manner described in the indenture. See "--Subordination."
Almost all of the operating assets of Peoples and its consolidated
subsidiaries are owned by those subsidiaries. Peoples is a legal entity separate
and distinct from its banking and other subsidiaries. Holders of debentures
should look only to Peoples for payments on the debentures. The principal
sources of Peoples' income are dividends from its banking and other
subsidiaries, and there are various limitations on Peoples' banking subsidiaries
to pay dividends, as discussed below. Peoples' banking subsidiaries are also
subject to restrictions on the transfer of funds by each depository institution
to Peoples and other affiliates, in the form of loans, other extensions of
credit, investments or purchases of assets.
Because Peoples is a holding company, Peoples' operations are conducted
by its subsidiaries, including its banking subsidiaries, which are subject to
significant federal and state regulation. See "Regulation and supervision."
Peoples' ability to receive dividends and loans from its subsidiaries is
restricted. Peoples' banking subsidiaries were able to declare dividends to
Peoples at March 31, 1999, without regulatory approval, of approximately $13.8
million. Further, the right of Peoples to participate in any distribution of
assets of any subsidiary upon that subsidiary's liquidation or reorganization or
otherwise, and thus the ability of holders of the capital securities to benefit
indirectly from the distribution, is subject to the prior claims of creditors of
the subsidiary, including depositors in the case of Peoples' banking
subsidiaries, except to the extent that Peoples may itself be recognized as a
creditor of that subsidiary. Accordingly, the debentures effectively will be
subordinated to all existing and future liabilities of Peoples' subsidiaries,
including deposit liabilities of Peoples' banking subsidiaries. Holders of
debentures should look only to the assets of Peoples for payments on the
debentures.
The indenture does not limit the amount of secured or unsecured debt,
including senior indebtedness, that may be incurred by Peoples or any of its
subsidiaries. As of March 31, 1999, Peoples, as part of its senior indebtedness,
had a note to a regional bank in the amount of $2.6 million. See
"--Subordination." Peoples expects from time to time that it will incur
additional indebtedness constituting senior indebtedness and that its
subsidiaries will incur additional liabilities.
Form, registration and transfer
If the debentures are distributed to the holders of capital and common
securities, the debentures may be represented by one or more global certificates
registered in the name of Cede & Co., as the nominee of DTC. The depositary
arrangements for the debentures are expected to be substantially similar to
those in effect for the capital securities. For a description of DTC and the
terms of the depositary arrangements relating to payments, transfers, voting
rights, redemptions and other notices and other matters, see "Description of
capital securities--Form, denomination, book-entry procedures and transfer."
Payment and paying agents
Payment of principal, any premium and interest, including any
additional sums and compounded interest, on the debentures will be made at the
offices of Peoples in Marietta, Ohio, or the office of the debenture trustee in
Wilmington, Delaware or at the office of any paying agent or paying agents
Peoples designates from time to time. At the option of Peoples, payment of any
interest may be made, except in the case of debentures in global form, by:
o Check mailed to the address of the person entitled thereto as that
address appears in the register for debentures; or
o Transfer to an account maintained by the person entitled
thereto as specified in the register for debentures, provided
proper transfer instructions have been received by the
relevant record date.
Payment of any interest on any debenture will be made to the person in
whose name the debenture is registered at the close of business on the record
date for that interest payment, except in the case of defaulted interest.
Peoples may at any time designate additional paying agents or rescind the
designation of any paying agent. However, Peoples will at all times be required
to maintain a paying agent in each place of payment for the debentures.
Any moneys deposited with the debenture trustee or any paying agent, or
then held by Peoples in trust, for the payment of the principal, any premium or
interest, including any additional sums and compounded interest, on any
debenture and remaining unclaimed for two years after the principal, premium or
interest has become due and payable will, at the request of Peoples, be repaid
to Peoples and the holder of the debenture must thereafter look, as a general
unsecured creditor, only to Peoples for payment thereof.
Option to extend interest payment date
So long as no event of default has occurred and is continuing under the
indenture, Peoples will have the right to defer the payment of interest on the
debentures, at any time and from time to time, for a period not exceeding ten
consecutive semi-annual periods with respect to each extension period. No
extension period may end on a date other than an interest payment date or extend
beyond May 1, 2029. At the end of the extension period, Peoples must pay all
interest then accrued and unpaid, together with interest thereon at the annual
rate of 8.62%, compounded semi-annually, to the extent permitted by applicable
law. During an extension period, interest will continue to accrue and, if the
debentures have been distributed to holders of the capital securities, holders
of debentures, or holders of the capital securities while capital securities are
outstanding, will be required to accrue deferred interest income for United
States federal income tax purposes prior to the receipt of cash attributable to
such income. See "Certain federal income tax consequences--Interest income and
original issue discount."
During any extension period, Peoples may not:
o Declare or pay any dividends or distributions on, or redeem,
purchase, acquire, or make a liquidation payment with respect
to, any of Peoples' capital stock;
o Make any payment of principal, interest or premium, if any, on
or repay, repurchase or redeem any debt securities of Peoples,
including any other junior subordinated debentures to be
issued by Peoples, that rank pari passu with or junior in
right of payment to the debentures; or
o Make any guarantee payments under any guarantee by Peoples of
the debt securities of any subsidiary of Peoples, including
any other guarantees to be issued by Peoples, if the guarantee
ranks pari passu with or junior in right of payment to the
debentures.
These limitations do not apply to:
o Dividends or distributions in Peoples' common shares, or
options, warrants or rights to subscribe for or purchase
Peoples' common shares;
o Any declaration of a dividend in connection with the
implementation of a shareholder rights plan, or the issuance
of shares under any shareholder rights plan in the future, or
the redemption or repurchase of any rights under a shareholder
rights plan;
o Payments under Peoples' guarantee for the benefit of holders of capital
securities;
o As a result of a reclassification of Peoples' capital stock or
the exchange or conversion of one class or series of Peoples'
capital stock for another class or series of Peoples' capital
stock;
o The purchase of fractional interests in shares of Peoples'
capital stock in the conversion or exchange provisions of that
capital stock or the security being converted or exchanged or
in a merger, consolidation or other business combination; and
o Purchases of common shares of Peoples related to the issuance
of common shares or rights under any of Peoples' benefit plans
for directors, officers or employees of Peoples and its
subsidiaries or Peoples' dividend reinvestment plan.
Peoples has no current intention to exercise its option to defer
payments of interest on the debentures.
Prior to the termination of any extension period, Peoples may further
extend the extension period. The extension must not cause the extension period
to exceed ten consecutive semi-annual periods, end on a date other than an
interest payment date or extend beyond May 1, 2029. Upon the termination of any
extension period and the payment of all amounts then due, Peoples may elect to
begin a new extension period, subject to the requirements described in this
prospectus. No interest will be due and payable during an extension period,
except at the end thereof. Peoples must give the property trustee, the
administrative trustees and the debenture trustee notice of its election of any
extension period, or an extension thereof, at least five business days prior to
the earlier of:
o The date the distributions on capital and common securities
would have been payable except for the election to begin or
extend the extension period;
o The date the property trustee of PEBO Capital Trust I is
required to give notice to any securities exchange or to
holders of capital securities of the record date;
o The date the distributions are payable; or
o The record date.
The debenture trustee will give notice of Peoples' election to begin or
extend a new extension period to the holders of the capital securities. There is
no limitation on the number of times that Peoples may elect to begin an
extension period.
Optional prepayment
The debentures will be prepayable, in whole or in part, at the option
of Peoples on or after May 1, 2009, subject to Peoples having received any
required regulatory approval, at the optional prepayment price equal to the
percentage of the outstanding principal amount of the debentures specified
below, plus, in each case, accrued and unpaid interest thereon to the date of
prepayment if prepaid during the 12-month period beginning May 1 of the years
indicated below:
Year Percentage
2009 104.310%
2010 103.879%
2011 103.448%
2012 103.017%
2013 102.586%
2014 102.155%
2015 101.724%
2016 101.293%
2017 100.862%
2018 100.431%
2019 and thereafter 100.000%
Special event prepayment
Prior to May 1, 2009, if a special event has occurred and is
continuing, Peoples may, at its option and subject to receipt of any required
regulatory approval, prepay the debentures, in whole but not in part, at any
time within 90 days of the occurrence of the special event, at the special event
prepayment price equal to the make-whole amount.
The "make-whole amount" will be an amount equal to the greater of
o 100% of the principal amount of the debentures; or
o The sum, as determined by a quotation agent, of the present
values of the remaining scheduled payments of principal and
interest on the debentures from the prepayment date to May 1,
2029, discounted to the prepayment date on a semi-annual basis
(assuming a 360-day year consisting of twelve 30-day months)
at the adjusted treasury rate.
The make-whole amount also includes any accrued and unpaid interest to the date
of prepayment.
If, following the occurrence of a special event, Peoples exercises its
option to prepay the debentures, then the proceeds of that prepayment must be
applied to redeem a like amount of securities of PEBO Capital Trust I at the
special event redemption price. See "Description of capital
securities--Redemption."
A "special event" means an investment company event, a regulatory
capital event or a tax event.
An "investment company event" means the receipt by Peoples and PEBO
Capital Trust I of an opinion of independent securities counsel experienced in
those matters, to the effect that as a result of any amendment to, or change,
including any announced prospective change, in, the laws or any regulation
thereunder of the United States or any rules, guidelines or policies of any
applicable regulatory authority for Peoples or any official administrative or
judicial decision interpreting or applying such laws or regulations, which
amendment or change is effective or which pronouncement or decision is announced
on or after the date of original issuance of its securities, PEBO Capital Trust
I is, or within 90 days of the date of the opinion will be, considered an
investment company that is required to be registered under the Investment
Company Act.
A "regulatory capital event" means the receipt by Peoples and PEBO
Capital Trust I of an opinion of independent bank regulatory counsel experienced
in those matters, to the effect that, as a result of any amendment to, or
change, including any announced prospective change, in, the laws, or any
regulations thereunder of the United States or any rules, guidelines or policies
of an applicable regulatory agency for Peoples or the banking subsidiaries or
any official administrative pronouncement or judicial decision interpreting or
applying those laws or regulations, which amendment or change is effective or
which pronouncement or decision is announced on or after the date of original
issuance of common and capital securities, the capital securities do not
constitute, or within 90 days of such opinion will not constitute, Tier 1
capital for purposes of the capital adequacy guidelines of the Federal Reserve
Board (or any successor regulatory authority with jurisdiction over bank holding
companies), or any capital adequacy guidelines as then in effect and applicable
to Peoples. The distribution of the debentures in connection with the
liquidation of PEBO Capital Trust I by Peoples will not in and of itself
constitute a regulatory capital event, unless the liquidation has occurred in
connection with a tax event.
A "tax event" means the receipt by Peoples and PEBO Capital Trust I of
an opinion of independent tax counsel experienced in those matters to the effect
that, as a result of any amendment to, or change, including any announced
prospective change, in, the laws or any regulations thereunder of the United
States or any political subdivision or taxing authority thereof or therein, or
as a result of any official administrative pronouncement or judicial decision
interpreting or applying those laws or regulations, which amendment or change is
effective or which pronouncement or decision is announced on or after the date
of original issuance of capital and common securities, there is more than an
insubstantial risk that:
o PEBO Capital Trust I is, or will be within 90 days of the date of
the opinion, subject to United States federal income tax with
respect to income received or accrued on the debentures;
o The interest payable by Peoples on the debentures is not, or
within 90 days of the date of the opinion will not be,
deductible by Peoples, in whole or in part, for United States
federal income tax purposes; or
o PEBO Capital Trust I is, or will be within 90 days of the date
of the opinion, subject to more than a de minimis amount of
other taxes, duties or other governmental charges.
"Adjusted treasury rate" means, with respect to a prepayment date, the
rate per annum equal to
o The yield, under the heading which represents the average for the
immediately prior week, appearing in the most recently published
statistical release designated "H.15 (519)" or any successor publication
which is published weekly by the Federal Reserve Board and which
establishes yields on actively traded United States Treasury securities
adjusted to constant maturity under the caption "Treasury Constant
Maturities," for the maturity corresponding to the remaining life, as
defined below. If no maturity is within three months before or three
months after the maturity corresponding to the remaining life, yields
for the two published maturities most closely corresponding to the
remaining life will be determined, and the adjusted treasury rate will
be interpolated or extrapolated from those yields on a straight-line
basis, rounding to the nearest month; or
o If that release, or any successor release, is not published during the
week preceding the calculation date or does not contain those yields,
the rate per annum equal to the semi-annual equivalent yield to
maturity to the comparable treasury issue, calculated using a price for
the comparable treasury issue, expressed as a percentage of its
principal amount, equal to the comparable treasury price for that
prepayment date,
plus: 295 basis points if the prepayment date occurs prior to April 20, 2000
and 250 basis points in all other cases.
"Comparable treasury issue" means the United States Treasury security
selected by the quotation agent as having a maturity comparable to the remaining
life of the debentures that would be utilized, at the time of selection and in
accordance with customary financial practice, in pricing new issues of corporate
debt securities of comparable maturity to the remaining life. If no United
States Treasury security has a maturity which is within a period from three
months before to three months after the remaining life, the two most closely
corresponding United States Treasury securities, as selected by the quotation
agent, will be used as the comparable treasury issue, and the adjusted treasury
rate will be interpolated or extrapolated on a straight-line basis, rounding to
the nearest month, using those securities.
"Comparable treasury price" means, with respect to a prepayment date:
o The average of three reference treasury dealer quotations for
the prepayment date, after excluding the highest and lowest
reference treasury dealer quotations, or
o The quotation agent obtains fewer than five reference treasury
dealer quotations, the average of all quotations.
"Quotation agent" means the reference treasury dealer appointed by Peoples.
"Reference treasury dealer" means a nationally recognized U.S. Government
securities dealer in New York, New York selected by Peoples.
"Reference treasury dealer quotations" means, with respect to each
reference treasury dealer and the prepayment date, the average, as determined by
the debenture trustee, of the bid and asked prices for the comparable treasury
issue, expressed in each case as a percentage of its principal amount, quoted in
writing to the debenture trustee by the reference treasury dealer at 5:00 p.m.,
New York time, on the third business day preceding the prepayment date.
"Remaining life" means the term of the debentures from the prepayment
date to May 1, 2029.
Notice of any prepayment will be mailed at least 30 days but not more
than 60 days before the prepayment date to each holder of debentures to be
prepaid at its registered address. Unless Peoples defaults in payment of the
prepayment price, on the prepayment date, interest will cease to accrue on the
debentures called for prepayment.
If PEBO Capital Trust I is required to pay any additional taxes, duties
or other governmental charges as a result of a tax event, Peoples will pay as
additional amounts on the debentures the amounts necessary in order that the
amount of distributions then due and payable by PEBO Capital Trust I on the
outstanding capital securities will not be reduced as a result of any additional
taxes, duties or other governmental charges to which PEBO Capital Trust I has
become subject as a result of a tax event. These additional amounts are referred
to as additional sums.
Certain covenants of Peoples
Peoples has also covenanted that it will not:
o Declare or pay any dividends or distributions on, or redeem,
purchase, acquire, or make a liquidation payment with respect
to, any of Peoples' capital stock;
o Make any payment of principal, interest or premium, if any, on
or repay, repurchase or redeem any debt securities of Peoples,
including any other junior subordinated debentures to be
issued by Peoples, that rank pari passu with or junior in
right of payment to the debentures; or
o Make any guarantee payments with respect to any guarantee by
Peoples of the debt securities of any subsidiary of Peoples,
including any other guarantees to be issued by Peoples, if the
guarantee ranks pari passu with or junior in right of payment
to the debentures,
if at that time:
o There has occurred any default of which Peoples has actual knowledge
that
o is, or with the giving of notice or the lapse of time, or both, would
be, an event of default under the indenture; and
o in respect of which Peoples has not taken reasonable steps to cure the
event of default;
o Peoples is in default with respect to its payment of any obligations
under the guarantee for the benefit of capital securities holders; or
o Peoples has given notice of its election to exercise its right
to commence an extension period as provided in the indenture
and the extension period, or any extension thereof, shall have
commenced and be continuing.
These limitations do not apply to:
o Dividends or distributions in Peoples' common shares, or options,
warrants or rights to subscribe for Peoples' common shares;
o Any declaration of a dividend in connection with the
implementation of a shareholder rights plan, or the issuance
of shares under any shareholder rights plan in the future, or
the redemption or repurchase of any rights under a shareholder
rights plan;
o Payments under Peoples' guarantee for the benefit of holders of capital
securities;
o As a result of a reclassification of Peoples' capital stock or
the exchange or conversion of one class or series of Peoples'
capital stock for another class or series of Peoples' capital
stock;
o The purchase of fractional interests in shares of Peoples'
capital stock in the conversion or exchange provisions of the
capital stock or the security being converted or exchanged or
in a merger, consolidation or other business combination; and
o Purchases of common shares of Peoples related to the issuance
of common shares or rights under any of Peoples' benefit plans
for directors, officers or employees of Peoples and its
subsidiaries or Peoples' dividend reinvestment plan.
So long as securities of PEBO Capital Trust I remain outstanding,
Peoples has also covenanted to:
o Directly or indirectly maintain 100% direct or indirect
ownership of the common securities, provided, however, that
any permitted successor of Peoples under the indenture may
succeed to Peoples' ownership of the common securities;
o Use commercially reasonable efforts to cause PEBO Capital Trust I to:
o remain a business trust, except in connection with
the distribution of debentures to the holders of
trust securities in liquidation of PEBO Capital Trust
I, the redemption of all the trust securities, or
certain mergers, conversions, consolidations or
amalgamations, each as permitted by the trust
agreement; and
o otherwise continue to be classified as a grantor
trust and not an association taxable as a corporation
for United States federal income tax purposes;
o Use commercially reasonable efforts to cause each holder of
securities of PEBO Capital I Trust to be treated as owning an
undivided beneficial interest in the debentures; and
o Not cause, as sponsor of PEBO Capital Trust I, or permit, as
holder of the common securities, the dissolution, winding up
or liquidation of PEBO Capital Trust I, except as provided in
the trust agreement.
Modification of indenture
From time to time Peoples and the debenture trustee may, without the
consent of the holders of debentures, amend the indenture for specified
purposes, including:
o Curing ambiguities, defects or inconsistencies -- the amendment must
not materially adversely affect the interest of the holders of
debentures; and
o Qualifying or maintaining the qualification of, the indenture under
the Trust Indenture Act.
The indenture contains provisions permitting Peoples and the debenture
trustee, with the consent of the holders of a majority in aggregate principal
amount of debentures, to modify the indenture in a manner affecting the rights
of the holders of debentures. No modification may, without the consent of the
holders of each outstanding debenture so affected:
o Change the stated maturity date;
o Reduce the principal amount of the debentures;
o Reduce the amount payable on prepayment;
o Reduce the rate or extend the time of payment of interest
except under Peoples' right under the indenture to defer the
payment of interest;
o Make the principal of, or interest or premium on, the
debentures payable in any coin or currency other than that
provided in the debentures;
o Impair or affect the right of any holder of debentures to institute
suit for the payment thereof; or
o Reduce the percentage of principal amount of debentures, the
holders of which are required to consent to any modification
of the indenture.
Debenture events of default
The indenture provides that any one or more of the following events
constitutes a "debenture event of default," whatever the reason for the event of
default and whether it is voluntary or involuntary or effected by operation of
law or under any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body:
o Failure for 30 days to pay any interest, including any
compounded interest and additional sums on the debentures or
any other junior subordinated debentures to be issued by
Peoples when due, subject to the deferral of any due date in
the case of an extension period with respect to the debentures
issued to PEBO Capital Trust I or all other debentures to be
issued by Peoples;
o Failure to pay any principal or premium, if any, on the
debentures or any other junior subordinated debentures to be
issued by Peoples when due whether at maturity, upon
prepayment, by declaration of acceleration of maturity or
otherwise;
o Failure to observe or perform any other covenant contained in
the indenture for 90 days after written notice to Peoples from
the debenture trustee or to Peoples and the debenture trustee
from the holders of at least 25% in aggregate outstanding
principal amount of debentures; or
o Events related to bankruptcy, insolvency or reorganization of Peoples.
The holders of a majority in aggregate outstanding principal amount of
the debentures have, subject to specified exceptions, the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the debenture trustee. The debenture trustee or the holders of not less than 25%
in aggregate outstanding principal amount of the debentures may declare the
principal due and payable immediately upon a debenture event of default. The
holders of a majority in aggregate outstanding principal amount of the
debentures may annul the declaration and waive the default if the default, other
than the non-payment of the principal of the debentures which has become due
solely by the acceleration, has been cured and a sum sufficient to pay all
matured installments of interest and principal due otherwise than by
acceleration has been deposited with the debenture trustee.
The holders of a majority in aggregate outstanding principal amount of
the debentures affected thereby may, on behalf of the holders of all the
debentures, waive any past default, except:
o A default in the payment of principal, any premium or
interest, including any additional sums and compounded
interest, unless the default has been cured and a sum
sufficient to pay all matured installments of interest,
premium, and principal due otherwise than by acceleration has
been deposited with the debenture trustee; or
o A default in respect of a covenant or provision which under
the indenture cannot be modified or amended without the
consent of the holder of each outstanding debenture.
The indenture requires the annual filing by Peoples with the debenture
trustee of a certificate as to the absence of specified defaults under the
indenture.
The indenture provides that the debenture trustee may withhold notice
of a debenture event of default from the holders of the debentures if the
debenture trustee considers it in the interest of those holders to do so.
Enforcement of rights by holders of capital securities
If a debenture event of default has occurred and is continuing and is
attributable to the failure of Peoples to pay the principal of, premium or
interest on the debentures on the due date, a holder of capital securities may
institute a direct action. Peoples may not amend the indenture to remove this
right to bring a direct action without the prior written consent of the holders
of all of the capital securities. Even if Peoples has made payments to a holder
of capital securities in connection with a direct action, Peoples will remain
obligated to pay the principal of, any premium or interest, including any
additional sums and compounded interest, on the debentures. Peoples will be
subrogated to the rights of the holder of those capital securities with respect
to payments on the capital securities to the extent of any payments made by
Peoples to the holder in any direct action.
The holders of the capital securities will not be able to exercise
directly any remedies, other than those described in the preceding paragraph,
available to the holders of the debentures, unless there has been an event of
default under the trust agreement. See "Description of capital
securities--Events of default; Notice."
Consolidation, merger, sale of assets and other transactions
The indenture provides that Peoples may not consolidate with or merge
into any other person or convey, transfer or lease its properties as an entirety
or substantially as an entirety to any person, and no person may consolidate
with or merge into Peoples or convey, transfer or lease its properties as an
entirety or substantially as an entirety to Peoples, unless:
o If Peoples consolidates with or merges into another person or
conveys or transfers its properties as an entirety or
substantially as an entirety to any person, the successor
person is organized under the laws of the United States or any
State or the District of Columbia, and the successor expressly
assumes Peoples' obligations under the indenture with respect
to the debentures;
o Immediately after giving effect to the transaction, no
debenture event of default, and no event which, after notice
or lapse of time or both, would become a debenture event of
default, has occurred and is continuing; and
o Other conditions prescribed in the indenture are met.
The general provisions of the indenture do not afford holders of the
debentures protection in the event of a highly leveraged or other transaction
involving Peoples that may adversely affect holders of the debentures.
Satisfaction and discharge
The indenture provides that when, among other things:
o All debentures not previously delivered to the debenture
trustee for cancellation have become due and payable, or will
become due and payable at maturity or called for redemption
within one year; and
o Peoples deposits, or causes to be deposited, with the
debenture trustee funds sufficient to pay and discharge the
entire indebtedness on the debentures not previously delivered
to the debenture trustee for cancellation, for the principal,
any premium and interest, including any additional sums and
compounded interest, to the date of the prepayment or to May
1, 2029,
then Peoples will be deemed to have satisfied and discharged the indenture. The
indenture will cease to be of further effect. Peoples will still, however, be
obligated to pay all other sums due under the indenture and to provide the
officers' certificates and opinions of counsel described in the indenture.
Subordination
The debentures will be subordinate and junior in right of payment to
all senior indebtedness to the extent provided in the indenture. Upon any
payment or distribution of assets to creditors in any liquidation, dissolution,
winding up, reorganization, assignment for the benefit of creditors, marshaling
of assets or any bankruptcy, insolvency, debt restructuring or similar
proceedings in connection with any insolvency or bankruptcy proceeding of
Peoples, all senior indebtedness must be paid in full before the holders of
debentures will be entitled to receive or retain any payment.
If the maturity of the debentures is accelerated, the holders of all
senior indebtedness outstanding at the time of the acceleration will first be
entitled to receive payment in full of the senior indebtedness before the
holders of debentures will be entitled to receive or retain any payment.
No payments on account of principal, any premium or interest, including
any additional sums and compounded interest, in respect of the debentures may be
made if there has occurred and is continuing a default in any payment under
senior indebtedness, or an event of default under any senior indebtedness
resulting in the acceleration of the maturity thereof, or if any judicial
proceeding shall be pending with respect to any default in payment of senior
indebtedness.
"Indebtedness" includes:
o Every obligation of Peoples for money borrowed;
o Every obligation of Peoples evidenced by bonds, debentures,
notes or other similar instruments, including obligations
incurred in connection with the acquisition of property,
assets or businesses;
o Every reimbursement obligation of Peoples under letters of
credit, banker's acceptances or similar facilities issued for
the account of Peoples;
o Every obligation of Peoples issued or assumed as the deferred
purchase price of property or services, excluding trade
accounts payable or accrued liabilities arising in the
ordinary course of business;
o Every capital lease obligation of Peoples;
o All indebtedness of Peoples whether incurred on or prior to
the date of the indenture or thereafter incurred, for claims
in respect of derivative products, including interest rate,
foreign exchange rate and commodity forward contracts, options
and swaps and similar arrangements; and
o Every obligation of the type referred to above of another
person and all dividends of another person the payment of
which Peoples has guaranteed or is responsible or liable for,
directly or indirectly, as obligor or otherwise.
"Indebtedness ranking on a parity with the debentures" includes
o Indebtedness, whether outstanding on the date of execution of
the indenture or thereafter created, assumed or incurred, to
the extent the indebtedness by its terms ranks equally with
and not prior to the debentures in the right of payment upon
the happening of the dissolution, winding-up, liquidation or
reorganization of Peoples; and
o All other debt securities, and guarantees in respect of those
debt securities, issued to any trust other than PEBO Capital
Trust I, or a trustee of a trust, partnership or other entity
affiliated with Peoples that is a financing vehicle of Peoples
in connection with the issuance by the financing entity of
equity securities or other securities guaranteed by Peoples
under an instrument that ranks pari passu with or junior in
right of payment to the guarantee by Peoples for the benefit
of holders of capital securities. The securing of any
indebtedness, otherwise constituting indebtedness ranking on a
parity with the debentures, will not be deemed to prevent the
indebtedness from constituting indebtedness ranking on a
parity with the debentures.
"Indebtedness ranking junior in right of payment to the debentures"
includes any indebtedness, whether outstanding on the date of execution of the
indenture or thereafter created, assumed or incurred, to the extent the
indebtedness by its terms ranks junior in right of payment to and not equally
with or prior to the debentures, and any other indebtedness ranking on a parity
with the debentures, in right of payment upon the happening of the dissolution,
winding-up, liquidation or reorganization of Peoples. The securing of any
indebtedness, otherwise constituting indebtedness ranking junior in right of
payment to the debentures, will not be deemed to prevent the indebtedness from
constituting indebtedness ranking junior in right of payment to the debentures.
"Senior indebtedness" includes all indebtedness, whether outstanding on
the date of execution of the indenture or thereafter created, assumed or
incurred, except indebtedness ranking on a parity with the debentures or
indebtedness ranking junior in right of payment to the debentures, and any
deferrals, renewals or extensions of that senior indebtedness.
Because Peoples is a bank holding company and a savings and loan
holding company, the right of Peoples to participate in any distribution of
assets of any banking subsidiary upon the subsidiary's liquidation or
reorganization or otherwise, and thus the ability of holders of the capital
securities to benefit indirectly from the distribution, is subject to the prior
claims of creditors of that subsidiary, including depositors, except to the
extent Peoples may itself be recognized as a creditor of that subsidiary. At
March 31, 1999, Peoples and its banking subsidiaries had total liabilities,
excluding liabilities owed to Peoples, of $785 million. Accordingly, the
debentures will be effectively subordinated to all existing and future
liabilities of Peoples' subsidiaries, including the deposit liabilities, and all
liabilities of any future subsidiaries of Peoples. The indenture does not limit
the incurrence or issuance of other secured or unsecured debt of Peoples or any
subsidiary, including senior indebtedness.
Restrictions on transfer
The original debentures were issued and the exchange debentures will be
issued and may be transferred only in blocks having an aggregate principal
amount of not less than $100,000 (100 debentures) and multiples of $1,000 in
excess of $100,000. Any attempted transfer of debentures in a block having an
aggregate principal amount of less than $100,000 will be void and of no legal
effect whatsoever. The purported transferee will not be the holder of the
debentures for any purpose, including the receipt of payments on the debentures.
Under those circumstances, the purported transferee will have no interest
whatsoever in such debentures.
Governing law
The indenture and the debentures are governed by and construed in
accordance with the laws of the State of New York.
Information concerning the debenture trustee
Following the exchange offer and the qualification of the indenture
under the Trust Indenture Act, the debenture trustee will have and be subject to
all the duties and responsibilities specified with respect to an indenture
trustee under the Trust Indenture Act. Subject to those provisions, the
debenture trustee is under no obligation to exercise any of the powers vested in
it by the indenture at the request of any holder of debentures, unless offered
reasonable indemnity by the holder against the costs, expenses and liabilities
which might be incurred thereby. The debenture trustee is not required to expend
or risk its own funds or otherwise incur personal financial liability in the
performance of its duties under the indenture.
Description of guarantee by Peoples
The original guarantee was executed and delivered by Peoples,
concurrently with the issuance by PEBO Capital Trust I of the original capital
securities, for the benefit of the holders from time to time of the original
capital securities. The new guarantee will be executed and delivered by Peoples,
concurrently with the issuance by PEBO Capital Trust I of the new capital
securities in connection with the exchange offer, for the benefit of the holders
from time to time of the new capital securities. Wilmington Trust Company will
act as guarantee trustee under the original guarantee and the new guarantee. The
new guarantee will be qualified under the Trust Indenture Act upon effectiveness
of the registration statement of which this prospectus is a part. The original
guarantee will not be qualified under the Trust Indenture Act. This summary of
selected provisions of the guarantees does not purport to be complete and is
subject to, and qualified in its entirety by reference to, all of the provisions
of the guarantees, including the definitions therein of selected terms, and the
Trust Indenture Act. The guarantee trustee will hold the original guarantee and
the new guarantee for the benefit of the holders of the original capital
securities and the new capital securities, respectively.
General
Peoples has agreed and will irrevocably agree to pay in full on a
subordinated basis, to the extent described in this prospectus, the guarantee
payments described below to the holders of the capital securities, as and when
due, regardless of any defense, right of set-off or counterclaim that PEBO
Capital Trust I may have or assert other than the defense of payment. The
following payments under the capital securities, to the extent not paid by or on
behalf of PEBO Capital Trust I, will be subject to the guarantees:
o Any accumulated and unpaid distributions required to be paid
on the capital securities, to the extent that PEBO Capital
Trust I has funds on hand legally available therefor at the
time;
o The applicable redemption price for capital securities called
for redemption, to the extent that PEBO Capital Trust I has
funds on hand legally available therefor at the time; and
o Upon a voluntary or involuntary dissolution, winding-up or
liquidation of PEBO Capital Trust I, other than in connection
with the distribution of the debentures to holders of the
capital securities or the redemption of all capital
securities, the lesser of
o the liquidation distribution, to the extent PEBO Capital Trust I
has funds legally available therefor at the time, and
o the amount of assets of PEBO Capital Trust I
remaining available for distribution to holders of
capital securities after satisfaction of liabilities
to creditors of PEBO Capital Trust I as required by
applicable law.
Peoples' obligation to make a guarantee payment may be satisfied by Peoples'
paying the required amounts to the holders of the capital securities or causing
PEBO Capital Trust I to pay those amounts to the holders.
The guarantees will be an irrevocable guarantee on a subordinated basis
of PEBO Capital Trust I's obligations under the capital securities, but will
apply only to the extent that PEBO Capital Trust I has funds sufficient to make
those payments. If Peoples does not make interest payments on the debentures
held by PEBO Capital Trust I, PEBO Capital Trust I will not be able to pay the
distributions on the capital securities and will not have funds legally
available therefor. See "Relationship among the capital securities, the
debentures and the guarantee by Peoples."
The original guarantee ranks, and the new guarantee will rank,
subordinate and junior in right of payment to all senior indebtedness to the
extent provided in the guarantees. See "--Status of the new guarantee" and
"--Status of the original guarantee."
Through the guarantees, the trust agreement, the debentures and the
indenture, taken together, Peoples has fully, irrevocably and unconditionally
guaranteed all of PEBO Capital Trust I's obligations under the capital
securities on a subordinated basis. No single document standing alone, or
operating in conjunction with fewer than all of the other documents, constitutes
that guarantee. It is only the combined operation of these documents that has
the effect of providing a full, irrevocable and unconditional guarantee of PEBO
Capital Trust I's obligations under the capital securities. See "Relationship
among the capital securities, the debentures and the guarantee by Peoples."
Status of the new guarantee
The new guarantee will be an unsecured obligation of Peoples and will
rank subordinate and junior in right of payment to all senior indebtedness in
the same manner as the debentures. See "Description of
debentures--Subordination." In addition, because Peoples is a holding company,
the right of Peoples to participate in any distribution of assets of any
subsidiary upon that subsidiary's liquidation, reorganization or otherwise is
subject to the prior claims of creditors of the subsidiary, including depositors
of Peoples' banking subsidiaries, except to the extent Peoples may itself be
recognized as a creditor of the subsidiary. Accordingly, Peoples' obligations
under the new guarantee effectively will be subordinated to all existing and
future liabilities of Peoples' present and future subsidiaries, including the
depositors of Peoples' banking subsidiaries. As a result, claimants should look
only to the assets of Peoples for payments under the new guarantee. The new
guarantee will rank pari passu with all other guarantees issued by Peoples with
respect to any preferred beneficial interests issued by other trusts to be
established by Peoples similar to PEBO Capital Trust I.
The new guarantee does not limit the amount of secured or unsecured
debt, including senior indebtedness, that Peoples or any of its subsidiaries may
incur. Peoples expects that it will incur additional indebtedness and that its
subsidiaries will also incur additional liabilities.
The new guarantee will constitute a guarantee of payment and not of
collection. This means the guaranteed party may institute a legal proceeding
directly against Peoples to enforce its rights under the new guarantee without
first instituting a legal proceeding against any other person or entity. The new
guarantee will be held for the benefit of the holders of the new capital
securities. The new guarantee will not be discharged, except by payment of the
guarantee payments in full to the extent not paid by PEBO Capital Trust I or
upon distribution to the holders of the new capital securities of the new
debentures.
Status of the original guarantee
If not all the original capital securities are exchanged for new
capital securities in the exchange offer, the original guarantee will not
terminate, but will continue to guarantee the obligations of Peoples for the
benefit of the holders of the original capital securities. The original
guarantee will terminate:
o Upon full payment of the applicable redemption price of the
original capital securities;
o Upon full payment of the liquidation amount payable upon
liquidation of PEBO Capital Trust I; or
o Upon distribution of original debentures to the holders of the
original capital securities.
The original guarantee will continue to be effective or will be reinstated, as
the case may be, if at any time any holder of the original capital securities
must restore payment of any sums paid under the original capital securities or
the original guarantee.
Events of default
An event of default under a guarantee will occur if Peoples fails to
perform any of its payment or other obligations under the guarantee. However,
except for a default in payment of any guarantee payment, Peoples must have
received notice of default and not cured the default within 60 days after
receipt of the notice. The holders of not less than a majority in liquidation
amount of the capital securities will have the right to direct the time, method
and place of conducting any proceeding for any remedy available to the guarantee
trustee under the guarantee or to direct the exercise of any trust or power
conferred upon the guarantee trustee under the guarantee.
Any holder of the capital securities may institute a legal proceeding
directly against Peoples to enforce its rights under the guarantee without first
instituting a legal proceeding against PEBO Capital Trust I, the guarantee
trustee or any other person or entity.
Peoples, as guarantor, will be required to file annually with the
guarantee trustee a certificate as to whether or not Peoples is in compliance
with all the conditions and covenants applicable to it under the guarantee.
Amendments and assignment
The holders of a majority of the liquidation amount of outstanding
capital securities must approve any amendment to the guarantee which materially
adversely affects the rights of holders of capital securities. Otherwise, the
guarantee may be amended without approval of the capital securities holders. The
manner of obtaining any required approval is described under "Description of
capital securities-Voting rights; Amendment of the trust agreement." All
guarantees and agreements contained in the guarantee agreements will bind the
successors, assigns, receivers, trustees and representatives of Peoples and will
inure to the benefit of the holders of the capital securities then outstanding.
Termination of the guarantee
The guarantee will terminate and be of no further force and effect:
o Upon full payment of the applicable redemption price of all
outstanding capital securities;
o Upon full payment of the liquidation amount payable upon liquidation
of PEBO Capital Trust I; or
o Upon distribution of debentures to the holders of the capital
securities.
The guarantee will continue to be effective or will be reinstated, as the case
may be, if at any time any holder of the capital securities must restore payment
of any sums paid under the capital securities or the guarantee.
Information concerning the guarantee trustee
Other than during the occurrence and continuance of a default by
Peoples in performance of the guarantee, the guarantee trustee will undertake to
perform only the duties specifically described in the guarantee. If a default
has occurred under the guarantee, the guarantee trustee must exercise the same
degree of care and skill as a prudent person would exercise or use in the
conduct of his or her own affairs. Subject to this provision, the guarantee
trustee will be under no obligation to exercise any of the powers vested in it
by the guarantee at the request of any holder of the capital securities, unless
it is offered reasonable indemnity against the costs, expenses and liabilities
that might be incurred thereby.
Governing law
The guarantee will be governed by and construed in accordance with the
laws of the State of New York.
Relationship among the capital securities,
the debentures and the guarantee by Peoples
Full and unconditional guarantee
Payments of distributions and other amounts due on the capital
securities, to the extent PEBO Capital Trust I has funds on hand legally
available for the payment of those distributions and other amounts, will be
irrevocably guaranteed by Peoples as and to the extent described under
"Description of guarantee by Peoples." Taken together, Peoples' obligations
under the debentures, the indenture, the trust agreement and the guarantee will
provide, in the aggregate, a full, irrevocable and unconditional guarantee of
payments of distributions and other amounts due on the capital securities on a
subordinated basis. No single document standing alone or operating in
conjunction with fewer than all of the other documents constitutes that
guarantee. It is only the combined operation of these documents that has the
effect of providing a full, irrevocable and unconditional guarantee of PEBO
Capital Trust I's obligations under the capital securities. If and to the extent
that Peoples does not make the required payments on the debentures, PEBO Capital
Trust I will not have sufficient funds to make the related payments, including
distributions, on the capital securities. The guarantee will not cover any
payment when PEBO Capital Trust I does not have sufficient funds on hand legally
available therefor. In that event, the remedy of a holder of capital securities
is to institute a direct action. The obligations of Peoples under the guarantee
will be subordinate and junior in right of payment to all senior indebtedness.
Sufficiency of payments
As long as payments of interest and other payments are made when due on
the debentures, those payments will be sufficient to cover distributions and
other payments due on the capital securities, primarily because:
o The aggregate principal amount or prepayment price of the
debentures will be equal to the sum of the liquidation amount
or redemption price, as applicable, of the securities of PEBO
Capital Trust I;
o The interest rate and interest and other payment dates on the
debentures will match the distribution rate and distribution
and other payment dates for the capital securities;
o Peoples, as sponsor, will pay for all and any costs, expenses
and liabilities of PEBO Capital Trust I, except PEBO Capital
Trust I's obligations to holders of capital securities under
the capital securities; and
o The trust agreement provides that PEBO Capital Trust I is not
authorized to engage in any activity that is not consistent
with its limited purposes.
Enforcement rights of holders of capital securities
A holder of any capital security may institute a legal proceeding
directly against Peoples to enforce its rights under the guarantee without first
instituting a legal proceeding against the guarantee trustee, PEBO Capital Trust
I or any other person or entity.
A default or event of default under any senior indebtedness would not
constitute a default or event of default under the trust agreement. However, in
the event of payment defaults under, or acceleration of, senior indebtedness,
the subordination provisions of the indenture will provide that no payments may
be made in respect of the debentures until the senior indebtedness has been paid
in full or any payment default thereunder has been cured or waived. Failure to
make required payments on the debentures would constitute an event of default
under the trust agreement.
Limited purpose of PEBO Capital Trust I
PEBO Capital Trust I exists for the sole purpose of issuing and selling
the capital securities and common securities, using the proceeds from the sale
of its securities to acquire the debentures issued by Peoples and engaging in
other incidental activities. A principal difference between the rights of a
holder of a capital security and a holder of a debenture is that a holder of a
debenture will be entitled to receive from Peoples the principal, any premium
and interest, including any additional sums and compounded interest, on
debentures held. A holder of capital securities is entitled to receive
distributions from PEBO Capital Trust I, or, in limited circumstances, from
Peoples under the guarantee, if and to the extent PEBO Capital Trust I has funds
on hand legally available for the payment of those distributions.
Rights upon dissolution
Unless the debentures are distributed to holders of the capital
securities, upon any voluntary or involuntary dissolution, winding-up or
liquidation of PEBO Capital Trust I, after satisfaction of the liabilities of
creditors as required by applicable law, the holders of the securities of PEBO
Capital Trust I will be entitled to receive, out of assets held by PEBO Capital
Trust I, the liquidation distribution in cash. See "Description of capital
securities--Liquidation of PEBO Capital Trust I and distribution of debentures."
Upon any voluntary or involuntary liquidation or bankruptcy of Peoples, the
property trustee, as holder of the debentures, would be a subordinated creditor
of Peoples, subordinated in right of payment to all senior indebtedness under
the indenture, but entitled to receive payment in full of principal, any premium
and interest before any shareholders of Peoples receive payments or
distributions. Since Peoples is the guarantor under the guarantee and has agreed
to pay for all costs, expenses and liabilities of PEBO Capital Trust I, other
than PEBO Capital Trust I's obligations to the holders of its securities, the
positions of a holder of capital securities and a holder of debentures relative
to other creditors and to shareholders of Peoples in the event of liquidation or
bankruptcy of Peoples are expected to be substantially the same.
Certain federal income tax consequences
General
The following is a summary of material United States federal income tax
consequences of the purchase, ownership and disposition of capital securities
held as capital assets by a holder who purchases capital securities upon initial
issuance. The statements of law and legal conclusions described in the summary
regarding the tax consequences to the beneficial owners of capital securities
represent the opinion of Vorys, Sater, Seymour and Pease LLP, special federal
income tax counsel to Peoples and PEBO Capital Trust I.
This summary and the tax opinion of special tax counsel only address
the tax consequences to a person that acquires capital securities on their
original issue at their original offering price. The summary does not address:
o All tax consequences that may be applicable to beneficial owners of the
capital securities;
o The tax consequences to special classes of holders such as
banks, thrifts, real estate investment trusts, regulated
investment companies, insurance companies, dealers in
securities or currencies, tax-exempt investors, United States
Alien Holders (as defined below) engaged in a U.S. trade or
business or persons that will hold the capital securities as a
position in a "straddle," as part of a "synthetic security" or
"hedge," as part of a "conversion transaction" or other
integrated investment, or as other than a capital asset;
o The tax consequences to persons that have a functional currency other
than the U.S. dollar;
o The tax consequences to shareholders, partners or beneficiaries of a
holder of capital securities;
o Any alternative minimum tax consequences; or
o The tax laws of any state or local government or of any
foreign government that may be applicable to the capital
securities.
This summary is based on the Internal Revenue Code of 1986, as amended,
the Treasury regulations and the administrative and judicial interpretations
thereof, as of the date of this prospectus, all of which are subject to change,
possibly on a retroactive basis. An opinion of special tax counsel is not
binding on the Internal Revenue Service or the courts. No rulings have been or
are expected to be sought from the IRS with respect to any of the transactions
described in this prospectus and no assurance can be given that the IRS will not
take contrary positions. Moreover, no assurance can be given that the opinions
expressed in this prospectus will not be challenged by the IRS or, if
challenged, that a challenge would not be successful.
Exchange of capital securities
The exchange of original capital securities for new capital securities
should not be a taxable event to holders for United States federal income tax
purposes. The exchange of original capital securities for new capital securities
under the exchange offer should not be treated as an "exchange" for United
States federal income tax purposes because the new capital securities should not
be considered to differ materially in kind or extent from the original capital
securities and because the exchange will occur by operation of the terms of the
original capital securities. If, however, the exchange of the original capital
securities for the new capital securities were treated as an exchange for United
States federal income tax purposes, the exchange should constitute a
recapitalization for federal income tax purposes. Accordingly, the new capital
securities should have the same issue price as the original capital securities,
and a holder should have the same adjusted tax basis and holding period in the
new capital securities as the holder had in the original capital securities
immediately before the exchange.
Classification of the debentures
Peoples has taken the position that the debentures should be classified
for United States federal income tax purposes as indebtedness of Peoples.
Peoples, PEBO Capital Trust I and the holders of the capital securities, by
acceptance of a beneficial interest in a capital security, have agreed to treat
the debentures as indebtedness of Peoples for all United States federal income
tax purposes. No assurance can be given, however, that this position will not be
challenged by the IRS or, if challenged, that the challenge will not be
successful. The remainder of this discussion assumes that the debentures will be
classified as indebtedness of Peoples for United States federal income tax
purposes.
Classification of PEBO Capital Trust I
In connection with the issuance of the capital securities, special tax
counsel rendered an opinion generally to the effect that, under then current law
and assuming full compliance with the terms of the trust agreement for PEBO
Capital Trust I, the indenture related to the debentures and selected other
documents, and based on facts and assumptions described in that opinion, PEBO
Capital Trust I will be classified for United States federal income tax purposes
as a grantor trust and not as an association taxable as a corporation.
Accordingly, for United States federal income tax purposes, each holder of
capital securities generally will be considered the owner of an undivided
interest in the debentures, and thus, each holder is required to include in its
gross income any interest received or accrued with respect to its allocable
share of those debentures.
Interest income and original issue discount
Under recently issued Treasury regulations applicable to debt
instruments issued on or after August 13, 1996, a "remote" contingency that
stated interest will not be timely paid will be ignored in determining whether a
debt instrument is issued with original issue discount. Peoples believes that
the likelihood of its exercising its option to defer payments of interest is
"remote" since exercising that option would, among other things, prevent Peoples
from declaring dividends on any class of its equity securities. Peoples has
regularly paid quarterly dividends on Peoples' common shares since its
organization in 1981. Accordingly, Peoples intends to take the position based on
the advice of special tax counsel that the debentures will not be considered to
be issued with original issue discount and, accordingly, stated interest on the
debentures generally will be taxable to a holder as ordinary income at the time
it is paid or accrued in accordance with the holder's method of tax accounting.
Under the Treasury regulations, if Peoples were to exercise its option
to defer payments of interest, the debentures would at that time be treated as
issued with original issue discount, and all stated interest on the debentures
would thereafter be treated as original issue discount as long as the debentures
remain outstanding. In that event, a holder will be required to accrue interest
on a daily basis regardless of the holder's method of tax accounting, and actual
distributions of stated interest would not be reported separately as taxable
income. Consequently, a holder of capital securities would be required to
include in gross income original issue discount even though Peoples would not
make actual cash payments during an extension period. Moreover, under the
Treasury regulations, if the option to defer the payment of interest was
determined not to be "remote" within the meaning of the Treasury regulations,
the debentures would be treated as having been originally issued with original
issue discount. In that event, all of a holder's taxable interest income under
the debentures would be accrued on a daily basis regardless of the holder's
method of tax accounting, and actual distributions of stated interest would not
be reported separately as taxable income. In each case, the amount of original
issue discount that will accrue each year will approximately equal the amount of
interest accruing at the stated interest rate.
Corporate holders of the capital securities will not be entitled to a
dividends-received deduction with respect to any income related to the capital
securities.
Receipt of debentures or cash upon liquidation of PEBO Capital Trust I
Peoples has the right at any time to liquidate PEBO Capital Trust I and
cause the debentures to be distributed to the holders of securities of PEBO
Capital Trust I. Under current law, such a distribution, for United States
federal income tax purposes, would be treated as a nontaxable event to each
holder, and each holder would receive an aggregate tax basis in the debentures
equal to the holder's aggregate tax basis in its capital securities. A holder's
holding period in the debentures received in liquidation of PEBO Capital Trust I
would include the period during which the capital securities were held by the
holder. A holder will account for interest in respect of the debentures received
from PEBO Capital Trust I in the manner described above under "--Interest income
and original issue discount," including any accrual of original issue discount
attributed to the debentures upon any distribution.
Under selected circumstances described in this prospectus under
"Description of capital securities", the debentures may be prepaid for cash and
the proceeds of that prepayment distributed to holders in redemption of their
capital securities. Under current law, such a redemption would, for United
States federal income tax purposes, constitute a taxable disposition of the
redeemed capital securities, and a holder could recognize gain or loss as if it
sold the redeemed capital securities for cash.
See "--Sales of capital securities."
Sales of capital securities
A holder that sells capital securities, including a redemption of the
capital securities by Peoples for cash, will recognize gain or loss equal to the
difference between its adjusted tax basis in the capital securities and the
amount realized on the sale of the capital securities. However, accrued and
unpaid interest which has not yet been included in income will be treated as
ordinary income. A holder's adjusted tax basis in the capital securities
generally will be its initial purchase price increased by any original issue
discount previously includable in the holder's gross income to the date of
disposition and decreased by any payments received on the capital securities in
respect of original issue discount. The gain or loss generally will be a capital
gain or loss and generally will be a long-term capital gain or loss if the
capital securities have been held for more than one year.
The capital securities may trade at a price that does not accurately
reflect the value of accrued but unpaid interest with respect to the underlying
debentures. A holder who uses the accrual method of accounting for tax purposes,
and a cash method holder, if the debentures are deemed to have been issued with
original issue discount, who disposes of his capital securities between record
dates for payments of distributions thereon will be required to include accrued
but unpaid interest on the debentures through the date of disposition in income
as ordinary income (i.e., interest or, if applicable, original issue discount),
and to add that amount to his adjusted tax basis in his pro rata share of the
underlying debentures that are deemed to be disposed. To the extent the selling
price is less than the holder's adjusted tax basis, which will include all
accrued but unpaid interest, a holder will recognize a capital loss. Subject to
limited exceptions, capital losses cannot be applied to offset ordinary income
for United States federal income tax purposes.
United States Alien Holders
For purposes of this discussion, a "United States Alien Holder" is any
corporation, individual, partnership, estate or trust that is not a U.S. Holder
for United States federal income tax purposes.
A "U.S. Holder" is a holder of capital securities who or which is:
o A citizen or individual resident, or is treated as a citizen
or individual resident, of the United States for federal
income tax purposes;
o A corporation or partnership, except in the case of a
partnership to the extent provided in Treasury regulations,
created or organized in or under the laws of the United States
or any political subdivision thereof;
o An estate the income of which is includable in its gross
income for federal income tax purposes without regard to its
source; or
o A trust if, and only if:
o a court within the United States is able to exercise primary
supervision over the administration of the trust; and
o one or more United States trustees have the authority to
control all substantial decisions of the trust.
Under present United States federal income tax laws:
o Payments by PEBO Capital Trust I or any of its paying agents
to any holder of a capital security who or which is a United
States Alien Holder will not be subject to United States
federal withholding tax if the payments are not effectively
connected with the conduct of a trade or business within the
United States, and
o the beneficial owner of the capital security does not
actually or constructively own 10 percent or more of
the total combined voting power of all classes of
stock of Peoples entitled to vote;
o the beneficial owner of the capital security is not a
controlled foreign corporation that is related to
Peoples through stock ownership; and
o either:
o the beneficial owner of the capital security
certifies to PEBO Capital Trust I or its
agent, under penalties of perjury, that it
is not a United States holder and provides
its name and address in the appropriate IRS
form; or
o a securities clearing organization, bank or
other financial institution that holds
customers' securities in the ordinary course
of business (a "financial institution"), and
holds the capital security in that capacity,
certifies to PEBO Capital Trust I or its
agent, under penalties of perjury, that such
statement has been received from the
beneficial owner by it or by a financial
institution between it and the beneficial
owner and furnishes PEBO Capital Trust I or
its agent with a copy thereof; and
o Subject to certain exceptions, a United States Alien Holder of
a capital security will not be subject to United States
federal withholding tax on any gain realized upon the sale or
other disposition of a capital security.
Final Treasury regulations (the "Withholding Regulations") would
provide alternative methods for satisfying the certification requirements
described in the preceding paragraph. The Withholding Regulations are to be
effective for certain payments made to United States Alien Holders after
December 31, 1999.
Information reporting to holders
Generally, income on the capital securities will be reported to holders
on Forms 1099, which forms should be mailed to holders of capital securities by
January 31st following each calendar year.
Backup withholding
Payments made on, and proceeds from the sale of, the capital securities
may be subject to a "backup" withholding tax of 31%, unless the holder complies
with certain identification and certification requirements. Any withheld amounts
will be allowed as a credit against the holder's United States federal income
tax, provided the required information is provided to the IRS.
THE UNITED STATES FEDERAL INCOME TAX DISCUSSION SET FORTH ABOVE IS
INCLUDED FOR GENERAL INFORMATION ONLY AND MAY NOT BE APPLICABLE DEPENDING UPON A
HOLDER'S PARTICULAR SITUATION. HOLDERS SHOULD CONSULT THEIR TAX ADVISORS WITH
RESPECT TO THE TAX CONSEQUENCES TO THEM OF THE PURCHASE, OWNERSHIP AND
DISPOSITION OF THE CAPITAL SECURITIES, INCLUDING THE TAX CONSEQUENCES UNDER
STATE, LOCAL, FOREIGN AND OTHER TAX LAWS AND THE POSSIBLE EFFECTS OF CHANGES IN
UNITED STATES FEDERAL OR OTHER TAX LAWS.
ERISA considerations
General
In evaluating the purchase of capital securities, a fiduciary of a
qualified profit-sharing, pension or stock bonus plan, including a plan for
self-employed individuals and their employees or any other employee benefit plan
subject to the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), a collective investment fund or separate account in which such plans
invest and any other investor using assets that are treated as assets of an
employee benefit plan subject to ERISA (each, a "Plan" and collectively,
"Plans") should consider:
o Whether the ownership of capital securities is in accordance with the
documents and instruments governing the Plan;
o Whether the ownership of capital securities is solely in the
interest of Plan participants and beneficiaries and otherwise
consistent with the fiduciary's responsibilities and in
compliance with the requirements of Part 4 of Title I of
ERISA, including, in particular, the diversification, prudence
and liquidity requirements of Section 404 of ERISA and the
prohibited transaction provisions of Section 406 of ERISA and
Section 4975 of the Internal Revenue Code;
o Whether the assets of PEBO Capital Trust I are treated as assets of
the Plan; and
o The need to value the assets of the Plan annually.
In addition, the fiduciary of an individual retirement arrangement under Section
408 of the Internal Revenue Code (an "IRA") considering the purchase of capital
securities should consider whether the ownership of capital securities would
result in a non-exempt prohibited transaction under Section 4975 of the Internal
Revenue Code.
Governmental plans and certain church plans (each as defined under
ERISA) are not subject to the prohibited transaction rules of ERISA and the
Internal Revenue Code. Those plans may, however, be subject to federal, state or
local laws or regulations which may affect their investment in the capital
securities. Any fiduciary of such a governmental or church plan considering an
investment in the capital securities should determine the need for, and the
availability, if necessary, of any exemptive relief under such laws or
regulations.
The fiduciary investment considerations summarized below provide a
general discussion that does not include all of the fiduciary investment
considerations relevant to Plans and, where indicated, IRA's. This summary is
based on the current provisions of ERISA and the Internal Revenue Code and
regulations and rulings thereunder, and may be changed (perhaps adversely and
with retroactive effect) by future legislative, administrative or judicial
actions.
PLANS AND IRA'S THAT ARE PROSPECTIVE PURCHASERS OF CAPITAL SECURITIES
SHOULD CONSULT WITH AND RELY UPON THEIR OWN ADVISORS IN EVALUATING THESE MATTERS
IN LIGHT OF THEIR OWN PARTICULAR CIRCUMSTANCES.
Plan Asset Regulation
Under Department of Labor regulations governing what constitutes the
assets of a Plan or IRA ("Plan Assets") for purposes of ERISA and the related
prohibited transaction provisions of the Internal Revenue Code (the "Plan Asset
Regulation," 29 C.F.R. Sec. 25103-101), when a Plan or IRA acquires an equity
interest in another entity, and that interest does not represent a "publicly
offered security" nor a security issued by an investment company registered
under the Investment Company Act, the Plan's assets include both the equity
interest and an undivided interest in each of the underlying assets of the
entity, unless it is established either that the entity is an operating company
or that equity participation in the entity by "benefit plan investors," as
defined in the Plan Asset Regulation, is not "significant." For purposes of the
Plan Asset Regulation, PEBO Capital Trust I will be neither an investment
company nor an operating company.
Under the Plan Asset Regulation, equity participation by benefit plan
investors will not be considered "significant" on any date only if immediately
after the most recent acquisition of the capital securities, the aggregate
interest in the capital securities held by benefit plan investors will be less
than 25% of the aggregate outstanding principal amount of the capital
securities. Although it is possible that the equity participation by benefit
plan investors on any date will not be "significant" for purposes of the Plan
Asset Regulation, that result cannot be assured. Consequently, if Plans, IRA's
or investors using assets of Plans purchase the capital securities, PEBO Capital
Trust I's assets could be deemed to be "plan assets" of those Plans and/or IRA's
for purposes of the fiduciary responsibility provisions of ERISA and the
prohibited transactions rules of ERISA and the Internal Revenue Code. Under
ERISA and the Internal Revenue Code, any person who exercises any authority or
control respecting the management or disposition of the assets of a Plan or IRA
is considered to be fiduciary of such Plan or IRA. The property trustee could
therefore become a fiduciary of the Plans and IRA's that invest in the capital
securities and be subject to the general fiduciary requirements of ERISA in
exercising its authority with respect to the management of the assets of PEBO
Capital Trust I. However, the property trustee will have only limited
discretionary authority with respect to PEBO Capital Trust I assets and the
remaining functions and responsibilities performed by the property trustee will
be for the most part custodial and ministerial in nature.
Prohibited transactions
Each of PEBO Capital Trust I, Peoples (the obligor under the debentures
held by PEBO Capital Trust I) and their affiliates or the property trustee may
be a party in interest or a disqualified person with respect to a Plan or IRA
investing in the capital securities. Therefore, such investment by a Plan or IRA
may give rise to a prohibited transaction. Consequently, before investing in the
capital securities or acquiring debentures, any person who is, or who is
acquiring those securities for, or on behalf of, a Plan or IRA should determine
that either a statutory or an administrative exemption from the prohibited
transaction rules discussed below or otherwise available is applicable to such
investment in the capital securities, or that such investment in, or acquisition
of, such securities will not result in a non-exempt prohibited transaction.
The statutory or administrative exemptions from the prohibited
transaction rules under ERISA and the Internal Revenue Code which may be
available to a Plan or IRA which is investing in the capital securities include:
o Prohibited Transaction Class Exemption ("PTCE") 90-1, regarding
investments by insurance company pooled separate accounts;
o PTCE 91-38, regarding investments by bank collective investment funds;
o PTCE 84-14, regarding transactions effected by qualified professional
asset managers;
o PTCE 96-23, regarding transactions effected by in-house asset managers;
and
o PTCE 95-60, regarding investments by insurance company general accounts
(collectively referred to as the "ERISA Investor Exemptions").
No person who is, or who in acquiring capital securities is, using the
assets of, a Plan or IRA may acquire capital securities unless one of the ERISA
Investor Exemptions or another applicable exemption is available to the Plan or
IRA, or such acquisition or holding of capital securities will not result in a
non-exempt Prohibited Transaction. The acquisition of the capital securities by
any person who is, or who in acquiring such capital securities is, using the
assets of, a Plan or IRA shall be deemed to constitute a representation by such
person to PEBO Capital Trust I, Peoples and the Initial Purchaser either that:
o It is not a Plan, IRA, trustee or other person acting on
behalf of a Plan or IRA or other person or entity using the
assets of any Plan or IRA to finance such purchase; or
o The acquisition will not result in a prohibited transaction
under Section 406 of ERISA or Section 4975 of the Internal
Revenue Code for which there is no applicable statutory or
administrative exemption.
THE DISCUSSION OF ERISA IN THIS PROSPECTUS IS GENERAL IN NATURE AND IS
NOT INTENDED TO BE ALL INCLUSIVE. ANY FIDUCIARY OF A PLAN, IRA, GOVERNMENTAL
PLAN OR CHURCH PLAN CONSIDERING AN INVESTMENT IN THE CAPITAL SECURITIES SHOULD
CONSULT WITH ITS LEGAL ADVISORS REGARDING THE CONSEQUENCES OF THE INVESTMENT AND
CONSIDER WHETHER THE PLAN OR IRA CAN MAKE THE REPRESENTATIONS NOTED ABOVE.
FURTHER, THE SALE OF INVESTMENTS TO PLANS AND IRA'S IS IN NO RESPECT A
REPRESENTATION BY PEBO CAPITAL TRUST I, PEOPLES, THE PROPERTY TRUSTEE OR ANY
OTHER PERSON ASSOCIATED WITH THE SALE OF THE CAPITAL SECURITIES THAT THE CAPITAL
SECURITIES MEET ALL RELEVANT LEGAL REQUIREMENTS WITH RESPECT TO INVESTMENTS BY
PLANS AND IRA'S GENERALLY OR ANY PARTICULAR PLAN, OR THAT THE CAPITAL SECURITIES
ARE OTHERWISE APPROPRIATE FOR PLANS AND IRA'S GENERALLY OR ANY PARTICULAR PLAN
OR IRA. ANY PURCHASER PROPOSING TO ACQUIRE CAPITAL SECURITIES WITH ASSETS OF ANY
PLAN OR IRA SHOULD CONSULT WITH ITS COUNSEL.
PLAN OF DISTRIBUTION
Each broker-dealer that receives new capital securities for its own
account in connection with the exchange offer must acknowledge that it will
deliver a prospectus in connection with any resale of the new capital
securities. This prospectus, as it may be amended or supplemented from time to
time, may be used by broker-dealers during the period referred to below in
connection with resales of new capital securities received in exchange for
original capital securities if the original capital securities were acquired by
the broker-dealers for their own accounts as a result of market-making
activities or other trading activities. Peoples and PEBO Capital Trust I have
agreed that this prospectus, as it may be amended or supplemented from time to
time, may be used by a broker-dealer in connection with resales of new capital
securities for a period ending 90 days after the expiration date of the exchange
offer, subject to extension under the limited circumstances described in this
prospectus. This period will end sooner if the broker-dealer disposes of all its
new capital securities. However, a broker-dealer who intends to use this
prospectus in connection with the resale of new capital securities received in
exchange for original capital securities under the exchange offer must notify us
on or prior to the expiration date, that it acquired its capital securities for
its own account as a result of market-making or other trading activities. This
notice may be given in the space provided for that purpose in the letter of
transmittal or may be delivered to the exchange agent. See "The Exchange
offer--Resale of new capital securities."
Neither Peoples nor PEBO Capital Trust I will receive any cash proceeds
from the issuance of the new capital securities offered by this prospectus. New
capital securities received by broker-dealers for their own accounts in
connection with the exchange offer may be sold from time to time in one or more
transactions in the over-the-counter market, in negotiated transactions, through
the writing of options on the new capital securities or a combination of these
methods of resale, at market prices prevailing at the time of resale, at prices
related to those prevailing market prices or at negotiated prices. Any resale
may be made directly to purchasers or to or through brokers or dealers who may
receive compensation in the form of commissions or concessions from any
broker-dealer and/or the purchasers of any new capital securities.
Any broker-dealer that resells new capital securities that were
received by it for its own account in connection with the exchange offer and any
broker or dealer that participates in a distribution of new capital securities
may be deemed to be an "underwriter" within the meaning of the Securities Act,
and any profit on any resale of new capital securities and any commissions or
concessions received by these persons may be deemed to be underwriting
compensation under the Securities Act. The letter of transmittal states that by
acknowledging that it will deliver and by delivering a prospectus, a
broker-dealer will not be deemed to admit that it is an "underwriter" within the
meaning of the Securities Act.
LEGAL MATTERS
Certain matters of Delaware law relating to the validity of the new
capital securities and the creation of PEBO Capital Trust I will be passed upon
on behalf of PEBO Capital Trust I by Richards, Layton & Finger, P.A., special
Delaware counsel to PEBO Capital Trust I and Peoples. The validity of the new
guarantee by Peoples and the new debentures will be passed upon for Peoples by
Vorys, Sater, Seymour and Pease LLP. Certain matters relating to United States
federal income tax considerations will be passed upon for Peoples by Vorys,
Sater, Seymour and Pease LLP.
EXPERTS
The consolidated financial statements of Peoples as of December 31,
1998 and 1997, and for each of the years in the three-year period ended December
31, 1998 incorporated by reference in Peoples' Annual Report on Form 10-K for
the fiscal year ended December 31, 1998, have been audited by Ernst & Young LLP,
independent auditors, as set forth in their report thereon incorporated by
reference therein and incorporated in this prospectus by reference. Such
consolidated financial statements are incorporated in this prospectus by
reference in reliance upon such report given on the authority of said firm as
experts in accounting and auditing.
You should rely only on the information contained in this prospectus or to
which you have been referred by us. We have not authorized anyone to provide you
with information that is different. The information in this prospectus may not
be accurate beyond the date indicated below, regardless of when this prospectus
is delivered or when the securities described in this prospectus are sold. This
prospectus is not an offer to sell these securities and it is not soliciting an
offer to buy these securities in any state where the offer or sale is not
permitted.
TABLE OF CONTENTS PAGE
Summary..............................................................2
Risk factors.........................................................7
Where you can find more information.................................14
Incorporation by reference..........................................15
Forward-looking statements..........................................15
Use of proceeds.....................................................16
Accounting treatment................................................16
Capitalization......................................................17
Selected consolidated financial and other data of Peoples...........18
Peoples Bancorp Inc.................................................21
Regulation and supervision..........................................24
PEBO Capital Trust I................................................25
The exchange offer..................................................26
Description of new securities; Comparison to original securities....40
Description of capital securities...................................40
Description of debentures...........................................57
Description of guarantee by Peoples.................................73
Relationship among the capital securities, the debentures and the
guarantee by Peoples..........................................77
Certain federal income tax consequences.............................79
ERISA considerations................................................84
Plan of distribution................................................87
Legal matters.......................................................88
Experts.............................................................88
Part II
Information not required in prospectus
Item 20..Indemnification of Directors and Officers.
Division (E) of Section 1701.13 of the Ohio Revised Code governs
indemnification by an Ohio corporation and provides as follows:
(E)(1) A corporation may indemnify or agree to indemnify any
person who was or is a party, or is threatened to be made a party, to
any threatened, pending, or completed action, suit, or proceeding,
whether civil, criminal, administrative, or investigative, other than an
action by or in the right of the corporation, by reason of the fact that
he is or was a director, officer, employee, or agent of the corporation,
or is or was serving at the request of the corporation as a director,
trustee, officer, employee, member, manager, or agent of another
corporation, domestic or foreign, nonprofit or for profit, a limited
liability company, or a partnership, joint venture, trust, or other
enterprise, against expenses, including attorney's fees, judgments,
fines, and amounts paid in settlement actually and reasonably incurred
by him in connection with such action, suit, or proceeding, if he acted
in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the corporation, and, with respect to
any criminal action or proceeding, if he had no reasonable cause to
believe his conduct was unlawful. The termination of any action, suit,
or proceeding by judgment, order, settlement, or conviction, or upon a
plea of nolo contendere or its equivalent, shall not, of itself, create
a presumption that the person did not act in good faith and in a manner
he reasonably believed to be in or not opposed to the best interests of
the corporation, and, with respect to any criminal action or proceeding,
he had reasonable cause to believe that his conduct was unlawful.
(2) A corporation may indemnify or agree to indemnify any person
who was or is a party, or is threatened to be made a party, to any
threatened, pending, or completed action or suit by or in the right of
the corporation to procure a judgment in its favor, by reason of the
fact that he is or was a director, officer, employee, or agent of the
corporation, or is or was serving at the request of the corporation as a
director, trustee, officer, employee, member, manager, or agent of
another corporation, domestic or foreign, nonprofit or for profit, a
limited liability company, or a partnership, joint venture, trust, or
other enterprise, against expenses, including attorney's fees, actually
and reasonably incurred by him in connection with the defense or
settlement of such action or suit, if he acted in good faith and in a
manner he reasonably believed to be in or not opposed to the best
interests of the corporation, except that no indemnification shall be
made in respect of any of the following:
(a) Any claim, issue, or matter as to which such person is
adjudged to be liable for negligence or misconduct in the
performance of his duty to the corporation unless, and only to
the extent that, the court of common pleas or the court in which
such action or suit was brought determines, upon application,
that, despite the adjudication of liability, but in view of all
the circumstances of the case, such person is fairly and
reasonably entitled to indemnity for such expenses as the court
of common pleas or such other court shall deem proper;
(b) Any action or suit in which the only liability
asserted against a director is pursuant to section 1701.95 of the
Revised Code.
(3) To the extent that a director, trustee, officer, employee,
member, manager, or agent has been successful on the merits or otherwise
in defense of any action, suit, or proceeding referred to in division
(E)(1) or (2) of this section, or in defense of any claim, issue, or
matter therein, he shall be indemnified against expenses, including
attorney's fees, actually and reasonably incurred by him in connection
with the action, suit, or proceeding.
(4) Any indemnification under division (E)(1) or (2) of this
section, unless ordered by a court, shall be made by the corporation
only as authorized in the specific case, upon a determination that
indemnification of the director, trustee, officer, employee, member,
manager, or agent is proper in the circumstances because he has met the
applicable standard of conduct set forth in division (E)(1) or (2) of
this section. Such determination shall be made as follows:
(a) By a majority vote of a quorum consisting of directors
of the indemnifying corporation who were not and are not parties
to or threatened with the action, suit, or proceeding referred to
in division (E)(1) or (2) of this section;
(b) If the quorum described in division (E)(4)(a) of this
section is not obtainable or if a majority vote of a quorum of
disinterested directors so directs, in a written opinion by
independent legal counsel other than an attorney, or a firm
having associated with it an attorney, who has been retained by
or who has performed services for the corporation or any person
to be indemnified within the past five years;
(c) By the shareholders;
(d) By the court of common pleas or the court in which the
action, suit, or proceeding referred to in division (E)(1) or (2)
of this section was brought.
Any determination made by the disinterested directors under
division (E)(4)(a) or by independent legal counsel under division
(E)(4)(b) of this section shall be promptly communicated to the person
who threatened or brought the action or suit by or in the right of the
corporation under division (E)(2) of this section, and, within ten days
after receipt of such notification, such person shall have the right to
petition the court of common pleas or the court in which such action or
suit was brought to review the reasonableness of such determination.
(5)(a) Unless at the time of a director's act or omission that is
the subject of an action, suit, or proceeding referred to in division
(E)(1) or (2) of this section, the articles or the regulations of a
corporation state, by specific reference to this division, that the
provisions of this division do not apply to the corporation and unless
the only liability asserted against a director in an action, suit, or
proceeding referred to in division (E)(1) or (2) of this section is
pursuant to section 1701.95 of the Revised Code, expenses, including
attorney's fees, incurred by a director in defending the action, suit or
proceeding shall be paid by the corporation as they are incurred, in
advance of the final disposition of the action, suit, or proceeding,
upon receipt of an undertaking by or on behalf of the director in which
he agrees to do both of the following:
(i) Repay such amount if it is proved by clear and
convincing evidence in a court of competent jurisdiction that his
action or failure to act involved an act or omission undertaken
with deliberate intent to cause injury to the corporation or
undertaken with reckless disregard for the best interests of the
corporation;
(ii) Reasonably cooperate with the corporation concerning
the action, suit, or proceeding.
(b) Expenses, including attorney's fees, incurred by a director,
trustee, officer, employee, member, manager, or agent in defending any
action, suit, or proceeding referred to in division (E)(1) or (2) of
this section, may be paid by the corporation as they are incurred, in
advance of the final disposition of the action, suit, or proceeding, as
authorized by the directors in the specific case, upon receipt of an
undertaking by or on behalf of the director, trustee, officer, employee,
member, manager, or agent to repay such amount, if it ultimately is
determined that he is not entitled to be indemnified by the corporation.
(6) The indemnification authorized by this section shall not be
exclusive of, and shall be in addition to, any other rights granted to
those seeking indemnification under the articles, the regulations, any
agreement, a vote of shareholders or disinterested directors, or
otherwise, both as to action in their official capacities and as to
action in another capacity while holding their offices or positions, and
shall continue as to a person who has ceased to be a director, trustee,
officer, employee, member, manager, or agent and shall inure to the
benefit of the heirs, executors, and administrators of such a person.
(7) A corporation may purchase and maintain insurance or furnish
similar protection, including, but not limited to, trust funds, letters
of credit, or self-insurance, on behalf of or for any person who is or
was a director, officer, employee, or agent of the corporation, or is or
was serving at the request of the corporation as a director, trustee,
officer, employee, member, manager, or agent of another corporation,
domestic or foreign, nonprofit or for profit, a limited liability
company, or a partnership, joint venture, trust, or other enterprise,
against any liability asserted against him and incurred by him in any
such capacity, or arising out of his status as such, whether or not the
corporation would have the power to indemnify him against such liability
under this section. Insurance may be purchased from or maintained with a
person in which the corporation has a financial interest.
(8) The authority of a corporation to indemnify persons pursuant
to division (E)(1) or (2) of this section does not limit the payment of
expenses as they are incurred, indemnification, insurance, or other
protection that may be provided pursuant to divisions (E)(5),(6), and
(7) of this section. Divisions (E)(1) and (2) of this section do not
create any obligation to repay or return payments made by the
corporation pursuant to division (E)(5),(6) or (7).
(9) As used in division (E) of this section, "corporation"
includes all constituent entities in a consolidation or merger and the
new or surviving corporation, so that any person who is or was a
director, officer, employee, trustee, member, manager, or agent of such
a constituent entity, or is or was serving at the request of such
constituent entity as a director, trustee, officer, employee, member,
manager, or agent of another corporation, domestic or foreign, nonprofit
or for profit, a limited liability company, or a partnership, joint
venture, trust, or other enterprise, shall stand in the same position
under this section with respect to the new or surviving corporation as
he would if he had served the new or surviving corporation in the same
capacity.
Article FIVE of the Code of Regulations of Peoples Bancorp Inc. governs
indemnification by Peoples Bancorp Inc. and provides as follows:
SECTION 5.01. MANDATORY INDEMNIFICATION. The corporation shall
indemnify any officer or director of the corporation who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (including, without limitation, any
action threatened or instituted by or in the right of the corporation),
by reason of the fact that he is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the
corporation as a director, trustee, officer, employee or agent of
another corporation (domestic or foreign, nonprofit or for profit),
partnership, joint venture, trust or other enterprise, against expenses
(including, without limitation, attorneys' fees, filing fees, court
reporters' fees and transcript costs), judgments, fines and amounts paid
in settlement actually and reasonably incurred by him in connection with
such action, suit or proceeding if he acted in good faith and in a
manner he reasonably believed to be in or not opposed to the best
interests of the corporation, and with respect to any criminal action or
proceeding, he had no reasonable cause to believe his conduct was
unlawful. A person claiming indemnification under this Section 5.01
shall be presumed, in respect of any act or omission giving rise to such
claim for indemnification, to have acted in good faith and in a manner
he reasonably believed to be in or not opposed to the best interests of
the corporation, and with respect to any criminal matter, to have had no
reasonable cause to believe his conduct was unlawful, and the
termination of any action, suit or proceeding by judgment, order,
settlement or conviction, or upon a plea of nolo contendere or its
equivalent, shall not, of itself, rebut such presumption.
SECTION 5.02. COURT-APPROVED INDEMNIFICATION. Anything
contained in the Regulations or elsewhere to the contrary
notwithstanding:
(A) the corporation shall not indemnify any officer or director
of the corporation who was a party to any completed action or suit
instituted by or in the right of the corporation to procure a judgment
in its favor by reason of the fact that he is or was a director,
officer, employee or agent of the corporation, or is or was serving at
the request of the corporation as a director, trustee, officer, employee
or agent of another corporation (domestic or foreign, nonprofit or for
profit), partnership, joint venture, trust or other enterprise, in
respect of any claim, issue or matter asserted in such action or suit as
to which he shall have been adjudged to be liable for acting with
reckless disregard for the best interests of the corporation or
misconduct (other than negligence) in the performance of his duty to the
corporation unless and only to the extent that the Court of Common Pleas
of Washington County, Ohio or the court in which such action or suit was
brought shall determine upon application that, despite such adjudication
of liability, and in view of all the circumstances of the case, he is
fairly and reasonably entitled to such indemnity as such Court of Common
Pleas or such other court shall deem proper; and
(B) the corporation shall promptly make any such unpaid
indemnification as is determined by a court to be proper as contemplated
by this Section 5.02.
SECTION 5.03. INDEMNIFICATION FOR EXPENSES. Anything contained in
the Regulations or elsewhere to the contrary notwithstanding, to the
extent that an officer or director of the corporation has been
successful on the merits or otherwise in defense of any action, suit or
proceeding referred to in Section 5.01, or in defense of any claim,
issue or matter therein, he shall be promptly indemnified by the
corporation against expenses (including, without limitation, attorneys'
fees, filing fees, court reporters' fees and transcript costs) actually
and reasonably incurred by him in connection therewith.
SECTION 5.04. DETERMINATION REQUIRED. Any indemnification
required under Section 5.01 and not precluded under Section 5.02 shall
be made by the corporation only upon a determination that such
indemnification of the officer or director is proper in the
circumstances because he has met the applicable standard of conduct set
forth in Section 5.01. Such determination may be made only (A) by a
majority vote of a quorum consisting of directors of the corporation who
were not and are not parties to, or threatened with, any such action,
suit or proceeding, or (B) if such a quorum is not obtainable or if a
majority of a quorum of disinterested directors so directs, in a written
opinion by independent legal counsel other than an attorney, or a firm
having associated with it an attorney, who has been retained by or who
has performed services for the corporation, or any person to be
indemnified, within the past five years, or (C) by the shareholders, or
(D) by the Court of Common Pleas of Washington County, Ohio or (if the
corporation is a party thereto) the court in which such action, suit or
proceeding was brought, if any; any such determination may be made by a
court under division (D) of this Section 5.04 at any time [including,
without limitation, any time before, during or after the time when any
such determination may be requested of, be under consideration by or
have been denied or disregarded by the disinterested directors under
division (A) or by independent legal counsel under division (B) or by
the shareholders under division (C) of this Section 5.04]; and no
failure for any reason to make any such determination, and no decision
for any reason to deny any such determination, by the disinterested
directors under division (A) or by independent legal counsel under
division (B) or by the shareholders under division (C) of this Section
5.04 shall be evidence in rebuttal of the presumption recited in Section
5.01. Any determination made by the disinterested directors under
division (A) or by independent legal counsel under division (B) of this
Section 5.04 to make indemnification in respect of any claim, issue or
matter asserted in an action or suit threatened or brought by or in the
right of the corporation shall be promptly communicated to the person
who threatened or brought such action or suit, and within ten (10) days
after receipt of such notification such person shall have the right to
petition the Court of Common Pleas of Washington County, Ohio or the
court in which such action or suit was brought, if any, to review the
reasonableness of such determination.
SECTION 5.05. ADVANCES FOR EXPENSES. Expenses (including, without
limitation, attorneys' fees, filing fees, court reporters' fees and
transcript costs) incurred in defending any action, suit or proceeding
referred to in Section 5.01 shall be paid by the corporation in advance
of the final disposition of such action, suit or proceeding to or on
behalf of the officer or director promptly as such expenses are incurred
by him, but only if such officer or director shall first agree, in
writing, to repay all amounts so paid in respect of any claim, issue or
other matter asserted in such action, suit or proceeding in defense of
which he shall not have been successful on the merits or otherwise:
(A) if it shall ultimately be determined as provided in Section
5.04 that he is not entitled to be indemnified by the corporation as
provided under Section 5.01; or
(B) if, in respect of any claim, issue or other matter asserted
by or in the right of the corporation in such action or suit, he shall
have been adjudged to be liable for acting with reckless disregard for
the best interests of the corporation or misconduct (other than
negligence) in the performance of his duty to the corporation, unless
and only to the extent that the Court of Common Pleas of Washington
County, Ohio or the court in which such action or suit was brought shall
determine upon application that, despite such adjudication of liability,
and in view of all the circumstances, he is fairly and reasonably
entitled to all or part of such indemnification.
SECTION 5.06. ARTICLE FIVE NOT EXCLUSIVE. The indemnification
provided by this Article Five shall not be exclusive of, and shall be in
addition to, any other rights to which any person seeking
indemnification may be entitled under the Articles or the Regulations or
any agreement, vote of shareholders or disinterested directors, or
otherwise, both as to action in his official capacity and as to action
in another capacity while holding such office, and shall continue as to
a person who has ceased to be an officer or director of the corporation
and shall inure to the benefit of the heirs, executors, and
administrators of such a person.
SECTION 5.07. INSURANCE. The corporation may purchase and
maintain insurance or furnish similar protection, including but not
limited to trust funds, letters of credit, or self-insurance, on behalf
of any person who is or was a director, officer, employee or agent of
the corporation, or is or was serving at the request of the corporation
as a director, trustee, officer, employee, or agent of another
corporation (domestic or foreign, nonprofit or for profit), partnership,
joint venture, trust or other enterprise, against any liability asserted
against him and incurred by him in any such capacity, or arising out of
his status as such, whether or not the corporation would have the
obligation or the power to indemnify him against such liability under
the provisions of this Article Five. Insurance may be purchased from or
maintained with a person in which the corporation has a financial
interest.
SECTION 5.08. CERTAIN DEFINITIONS. For purposes of this
Article Five, and as examples and not by way of limitation:
(A) A person claiming indemnification under this Article Five
shall be deemed to have been successful on the merits or otherwise in
defense of any action, suit or proceeding referred to in Section 5.01,
or in defense of any claim, issue or other matter therein, if such
action, suit or proceeding shall be terminated as to such person, with
or without prejudice, without the entry of a judgment or order against
him, without a conviction of him, without the imposition of a fine upon
him and without his payment or agreement to pay any amount in settlement
thereof (whether or not any such termination is based upon a judicial or
other determination of the lack of merit of the claims made against him
or otherwise results in a vindication of him); and
(B) References to an "other enterprise" shall include employee
benefit plans; references to a "fine" shall include any excise taxes
assessed on a person with respect to an employee benefit plan; and
references to "serving at the request of the corporation" shall include
any service as a director, officer, employee or agent of the corporation
which imposes duties on, or involves services by, such director,
officer, employee or agent with respect to an employee benefit plan, its
participants or beneficiaries; and a person who acted in good faith and
in a manner he reasonably believed to be in the best interests of the
participants and beneficiaries of an employee benefit plan shall be
deemed to have acted in a manner "not opposed to the best interests of
the corporation" within the meaning of that term as used in this Article
Five.
SECTION 5.09. VENUE. Any action, suit or proceeding to determine
a claim for indemnification under this Article Five may be maintained by
the person claiming such indemnification, or by the corporation, in the
Court of Common Pleas of Washington County, Ohio. The corporation and
(by claiming such indemnification) each such person consent to the
exercise of jurisdiction over its or his person by the Court of Common
Pleas of Washington County, Ohio in any such action, suit or proceeding.
The Registrant has purchased insurance coverage under a policy which
insures directors and officers against certain liabilities which might be
incurred by them in such capacities.
Section 10.4(a) of the Amended and Restated Declaration of Trust of
PEBO Capital Trust I, dated as of April 20, 1999, governs indemnification by
Peoples Bancorp Inc. (the "Sponsor") of the administrative trustees of PEBO
Capital Trust I (for purposes of Section 10.4 defined as "Company Indemnified
Persons"). That Section provides as follows:
SECTION 10.4 INDEMNIFICATION.
(a) (i) The Sponsor shall indemnify, to the full
extent permitted by law, any Company Indemnified Person who
was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative
(other than an action by or in the right of PEBO Capital Trust
I) by reason of the fact that he is or was a Company
Indemnified Person, against expenses (including attorneys'
fees and expenses), judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in
connection with such action, suit or proceeding if he acted in
good faith and in a manner he reasonably believed to be in or
not opposed to the best interests of PEBO Capital Trust I,
and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. The
termination of any action, suit or proceeding by judgment,
order, settlement, conviction, or upon a plea of nolo
contendere or its equivalent, shall not, of itself, create a
presumption that the Company Indemnified Person did not act in
good faith and in a manner which he reasonably believed to be
in or not opposed to the best interests of PEBO Capital Trust
I, and, with respect to any criminal action or proceeding, had
reasonable cause to believe that his conduct was unlawful.
(ii) The Sponsor shall indemnify, to the
full extent permitted by law, any Company Indemnified Person
who was or is a party or is threatened to be made a party to
any threatened, pending or completed action or suit by or in
the right of PEBO Capital Trust I to procure a judgment in its
favor by reason of the fact that he is or was a Company
Indemnified Person against expenses (including attorneys' fees
and expenses) actually and reasonably incurred by him in
connection with the defense or settlement of such action or
suit if he acted in good faith and in a manner he reasonably
believed to be in or not opposed to the best interests of PEBO
Capital Trust I and except that no such indemnification shall
be made in respect of any claim, issue or matter as to which
such Company Indemnified Person shall have been adjudged to be
liable to PEBO Capital Trust I unless and only to the extent
that the Court of Chancery of Delaware or the court in which
such action or suit was brought shall determine upon
application that, despite the adjudication of liability, but
in view of all the circumstances of the case, such Person is
fairly and reasonably entitled to indemnity for such expenses,
which such Court of Chancery or such other court shall deem
proper.
(iii) To the extent that a Company
Indemnified Person shall be successful on the merits or
otherwise (including dismissal of an action without prejudice
or the settlement of an action without admission of liability)
in defense of any action, suit or proceeding referred to in
paragraphs (i) and (ii) of this Section 10.4(a), or in defense
of any claim, issue or matter therein, he shall be
indemnified, to the full extent permitted by law, against
expenses (including attorneys' fees) actually and reasonably
incurred by him in connection therewith.
(iv) Any indemnification under paragraphs
(i) and (ii) of this Section 10.4(a) (unless ordered by a
court) shall be made by the Sponsor only as authorized in the
specific case upon a determination that indemnification of the
Company Indemnified Person is proper in the circumstances
because he has met the applicable standard of conduct set
forth in paragraphs (i) and (ii). Such determination shall be
made (1) by the Administrative Trustees by a majority vote of
a Quorum consisting of such Administrative Trustees who were
not parties to such action, suit or proceeding, (2) if such a
Quorum is not obtainable, or, even if obtainable, if a Quorum
of disinterested Administrative Trustees so directs, by
independent legal counsel in a written opinion, or (3) by the
Common Security Holder of PEBO Capital Trust I.
(v) Expenses (including attorneys' fees and
expenses) actually and reasonably incurred by a Company
Indemnified Person in defending a civil, criminal,
administrative or investigative action, suit or proceeding
referred to in paragraphs (i) and (ii) of this Section 10.4(a)
shall be paid by the Sponsor in advance of the final
disposition of such action, suit or proceeding upon receipt of
an undertaking by or on behalf of such Company Indemnified
Person to repay such amount if it shall ultimately be
determined that he is not entitled to be indemnified by the
Sponsor as authorized in this Section 10.4(a). Notwithstanding
the foregoing, no advance shall be made by the Sponsor if a
determination is reasonably and promptly made (i) by the
Administrative Trustees by a majority vote of a Quorum of
disinterested Administrative Trustees, (ii) if such a Quorum
is not obtainable, or, even if obtainable, if a Quorum of
disinterested Administrative Trustees so directs, by
independent legal counsel in a written opinion or (iii) by the
Common Security Holder of PEBO Capital Trust I, that, based
upon the facts known to the Administrative Trustees, counsel
or the Common Security Holder at the time such determination
is made, such Company Indemnified Person acted in bad faith or
in a manner that the Common Security Holder did not believe to
be in or not opposed to the best interests of PEBO Capital
Trust I, or, with respect to any criminal proceeding, that
such Company Indemnified Person believed or had reasonable
cause to believe his conduct was unlawful. In no event shall
any advance be made in instances where the Administrative
Trustees, independent legal counsel or Common Security Holder
reasonably determine that a Company Indemnified Person
deliberately breached his duty to PEBO Capital Trust I or its
Common or Capital Security Holders.
(vi) The indemnification and advancement of
expenses provided by, or granted pursuant to, the other
paragraphs of this Section 10.4(a) shall not be deemed
exclusive of any other rights to which those seeking
indemnification and advancement of expenses may be entitled
under any agreement, vote of stockholders or disinterested
directors of the Sponsor or Capital Security Holders of PEBO
Capital Trust I or otherwise, both as to action in his
official capacity and as to action in another capacity while
holding such office. All rights to indemnification under this
Section 10.4(a) shall be deemed to be provided by a contract
between the Sponsor and each Company Indemnified Person who
serves in such capacity at any time while this Section 10.4(a)
is in effect. Any repeal or modification of this Section
10.4(a) shall not affect any rights or obligations then
existing.
(vii) The Sponsor or PEBO Capital Trust I
may purchase and maintain insurance on behalf of any person
who is or was a Company Indemnified Person against any
liability asserted against him and incurred by him in any such
capacity, or arising out of his status as such, whether or not
the Debenture Issuer would have the power to indemnify him
against such liability under the provisions of this Section
10.4(a).
(viii) For purposes of this Section 10.4(a),
references to "PEBO Capital Trust I" shall include, in
addition to the resulting or surviving entity, any constituent
entity (including any constituent of a constituent) absorbed
in a consolidation, merger or conversion, so that any person
who is or was a director, trustee, officer or employee of such
constituent entity, or is or was serving at the request of
such constituent entity as a director, trustee, officer,
employee or agent of another entity, shall stand in the same
position under the provisions of this Section 10.4(a) with
respect to the resulting or surviving entity as he would have
with respect to such constituent entity if its separate
existence had continued.
(ix) The indemnification and advancement of
expenses provided by, or granted pursuant to, this Section
10.4(a) shall, unless otherwise provided when authorized or
ratified, continue as to a Person who has ceased to be a
Company Indemnified Person and shall inure to the benefit of
the heirs, executors and administrators of such a Person.
Item 21. Exhibits and financial statement schedules
The following exhibits are filed as part of this Registration
Statement:
Exhibit No. Description
- ----------- --------------------------------------------------
4.1 Indenture, dated as of April 20, 1999, between Peoples Bancorp
Inc. and Wilmington Trust Company, as Debenture Trustee,
relating to Junior Subordinated Deferrable Interest Debentures
4.2 Form of Certificate of Series B 8.62% Junior Subordinated
Deferrable Interest Debenture
4.3 Form of Certificate of Series A 8.62% Junior Subordinated
Deferrable Interest Debenture
4.4 Certificate of Trust of PEBO Capital Trust I
4.5 Amended and Restated Declaration of Trust of PEBO Capital Trust
I, dated as of April 20, 1999
4.6 Form of Common Security
4.7 Form of Series B 8.62% Capital Security Certificate
4.8 Form of Series A 8.62% Capital Security Certificate
4.9 Form of Series B Capital Securities Guarantee Agreement between
Peoples Bancorp Inc. and Wilmington Trust Company, as Guarantee
Trustee, relating to Series B 8.62% Capital Securities
4.10 Series A Capital Securities Guarantee Agreement, dated as of
April 20, 1999, between Peoples Bancorp Inc. and Wilmington
Trust Company, as Guarantee Trustee, relating to Series A 8.62%
Capital Securities.
4.11 Registration Rights Agreement, dated April 20, 1999, among
Peoples Bancorp Inc., PEBO Capital Trust I and Sandler O'Neill &
Partners, L.P.
5.1 Opinion and consent of Vorys, Sater, Seymour and Pease LLP as to
the validity of the Series B 8.62% Junior Subordinated Deferrable
Interest Debentures and the Series B Capital Securities Guarantee
to be issued by Peoples Bancorp Inc.
5.2 Opinion and consent of Richards, Layton & Finger, P.A. as to the
validity of the Series B 8.62% Capital Securities
8.0 Opinion of Vorys, Sater, Seymour and Pease LLP as to certain
federal income tax matters
12.0 Computation of ratio of earnings to fixed charges
23.1 Consent of Ernst & Young LLP
23.2 Consent of Vorys, Sater, Seymour and Pease LLP (included in
Exhibit 5.1)
23.3 Consent of Richards, Layton & Finger, P.A. (included in
Exhibit 5.2)
24.0 Power of Attorney of Certain Officers and Directors of
Peoples Bancorp Inc.
25.1 Form T-1 Statement of Eligibility of Wilmington Trust
Company to act as Debenture Trustee under the Indenture
25.2 Form T-1 Statement of Eligibility of Wilmington Trust
Company to act as Property Trustee under the Amended and
Restated Declaration of Trust of PEBO Capital Trust I
25.3 Form T-1 Statement of Eligibility of Wilmington Trust
Company to act as Guarantee Trustee under the Series B Capital
Securities Guarantee Agreement for the benefit of the holders
of Series B 8.62% Capital Securities
99.1 Form of Letter of Transmittal
99.2 Form of Notice of Guaranteed Delivery
Item 12. Undertakings
A. Each of the undersigned Registrants hereby undertakes:
(1) To file, during any period in which offers or sales or
being made, a post-effective amendment to this Registration Statement:
(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 this
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. Notwithstanding the
foregoing, any increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated maximum
offering range may be reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume
and price represent no more than a 20% change in the maximum aggregate offering
price set forth in the "Calculation of Registration Fee" table in the effective
registration statement; and
(iii) To include any material information with
respect to the plan of distribution not previously disclosed in the Registration
Statement or any material change to such
information in the Registration Statement.
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
B. Each of the undersigned Registrants hereby undertakes that, for the
purposes of determining any liability under the Securities Act of 1933, each
filing of a Registrant's annual report pursuant to Section 13(a) or Section
15(d) of the Securities Exchange Act of 1934 (and where applicable, each filing
of an employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in this
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered herein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
C. Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the provisions described in Item 20, 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
Registrant of expenses incurred or paid by a director, officer or controlling
person of Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, 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 question of 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.
D. Each of the undersigned Registrants hereby undertakes to respond to
requests for information that is incorporated by reference into the Prospectus
pursuant to Items 4, 10(b), 11, or 13 of this Form, within one business day of
receipt of such request, and to send the incorporated documents by first class
mail or other equally prompt means. This includes information contained in
documents filed subsequent to the effective date of the Registration Statement
through the date of responding to the request.
E. Each of the undersigned Registrants hereby undertakes to supply by
means of the post-effective amendment all information concerning a transaction,
and the company being acquired involved therein, that was not the subject of and
included in the Registration Statement when it became effective.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Peoples
Bancorp Inc. has duly caused this Pre-Effective Amendment No. 1 to Form S-4
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Marietta, State of Ohio, on July 30, 1999.
PEOPLES BANCORP INC.
By: /s/ ROBERT E. EVANS, PRESIDENT
Robert E. Evans, President
Pursuant to the requirements of the Securities Act of 1933, this
Pre-Effective Amendment No. 1 to Form S-4 Registration Statement has been signed
by the following persons in the capacities indicated, on the 30th day of July,
1999.
Signatures Title
- --------- -------
/s/ROBERT E. EVANS President and Chief Executive Officer;
- --------------------
Robert E. Evans Director
*George W. Broughton Director
- --------------------
George W. Broughton
*Frank L. Christy Director
- --------------------
Frank L. Christy
*Wilford D. Dimit Director
- --------------------
Wilford D. Dimit
*Barton S. Holl Director
- --------------------
Barton S. Holl
*Rex E. Maiden Director
- --------------------
Rex E. Maiden
*Paul T. Theisen Director
- --------------------
Paul T. Theisen
*Thomas C. Vadakin Director
- --------------------
Thomas C. Vadakin
*Joseph H. Wesel Director
- --------------------
Joseph H. Wesel
Chief Financial Officer and Principal
/s/JOHN W. CONLON Accounting Officer
- --------------------
John W. Conlon
*By: /S/ROBERT E. EVANS
---------------
Robert E. Evans
Attorney-in-Fact
Pursuant to the requirements of the Securities Act of 1933, PEBO
Capital Trust I has duly caused this Pre-Effective Amendment No. 1 to Form S-4
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Marietta, State of Ohio, on July 30, 1999.
PEBO CAPITAL TRUST I
By:/s/ MARK F. BRADLEY
---------------------------------------------
Mark F. Bradley, as Administrative Trustee
By:/s/ JOHN W. CONLON
---------------------------------------------
John W. Conlon, as Administrative Trustee
By:/s/ CHARLES R. HUNSAKER
----------------------------------------------
Charles R. Hunsaker, as Administrative Trustee
INDEX TO EXHIBITS
-----------------
Exhibit No. Description
- ----------- ---------------------------------------------------------------
4.1 Indenture, dated as of April 20, 1999, between Peoples Bancorp
Inc. and Wilmington Trust Company, as Debenture Trustee,
relating to Junior Subordinated Deferrable Interest Debentures*
4.2 Form of Certificate of Series B 8.62% Junior Subordinated
Deferrable Interest Debenture*
4.3 Form of Certificate of Series A 8.62% Junior Subordinated
Deferrable Interest Debenture*
4.4 Certificate of Trust of PEBO Capital Trust I*
4.5 Amended and Restated Declaration of Trust of PEBO Capital Trust
I, dated as of April 20, 1999*
4.6 Form of Common Security*
4.7 Form of Series B 8.62% Capital Security Certificate*
4.8 Form of Series A 8.62% Capital Security Certificate*
4.9 Form of Series B Capital Securities Guarantee Agreement between
Peoples Bancorp Inc. and Wilmington Trust Company, as Guarantee
Trustee, relating to Series B 8.62% Capital Securities*
4.10 Series A Capital Securities Guarantee Agreement, dated as of
April 20, 1999, between Peoples Bancorp Inc. and Wilmington
Trust Company, as Guarantee Trustee, relating to Series A 8.62%
Capital Securities*
4.11 Registration Rights Agreement, dated April 20, 1999, among
Peoples Bancorp Inc., PEBO Capital Trust I and Sandler O'Neill &
Partners, L.P.*
5.1 Opinion and consent of Vorys, Sater, Seymour and Pease LLP as to
the validity of the Series B 8.62% Junior Subordinated Deferrable
Interest Debentures and the Series B Capital Securities Guarantee
to be issued by Peoples Bancorp Inc.
5.2 Opinion and consent of Richards, Layton & Finger, P.A. as to the
validity of the Series B 8.62% Capital Securities
8.0 Opinion of Vorys, Sater, Seymour and Pease LLP as to certain
federal income tax matters
12.0 Computation of ratio of earnings to fixed charges
23.1 Consent of Ernst & Young LLP*
23.2 Consent of Vorys, Sater, Seymour and Pease LLP (included in
Exhibit 5.1)
23.3 Consent of Richards, Layton & Finger, P.A. (included in
Exhibit 5.2)
24.0 Power of Attorney of Certain Officers and Directors of
Peoples Bancorp Inc.*
25.1 Form T-1 Statement of Eligibility of Wilmington Trust
Company to act as Debenture Trustee under the Indenture*
25.2 Form T-1 Statement of Eligibility of Wilmington Trust
Company to act as Property Trustee under the Amended and
Restated Declaration of Trust of PEBO Capital Trust I*
25.3 Form T-1 Statement of Eligibility of Wilmington Trust
Company to act as Guarantee Trustee under the Series B Capital
Securities Guarantee Agreement for the benefit of the holders
of Series B 8.62% Capital Securities*
99.1 Form of Letter of Transmittal*
99.2 Form of Notice of Guaranteed Delivery*
* Previously filed.
[LETTERHEAD OF VORYS, SATER, SEYMOUR AND PEASE LLP]
July 30, 1999
Board of Directors
Peoples Bancorp Inc.
138 Putnam Street
Marietta, OH 45750
Gentlemen:
In connection with the registration under the Securities Act
of 1933, as amended (the "1933 Act"), of (a) $30,000,000 aggregate principal
amount of Series B 8.62% Junior Subordinated Deferrable Interest Debentures (the
"New Junior Subordinated Debentures") of Peoples Bancorp Inc., an Ohio
corporation ("Peoples"), to be issued pursuant to the terms of the Indenture
dated as of April 20, 1999 (the "Indenture"), between Peoples and Wilmington
Trust Company, as Debenture Trustee; (b) $30,000,000 aggregate liquidation
amount of Series B 8.62% Capital Securities (the "New Capital Securities") of
PEBO Capital Trust I, a business trust created under the laws of the State of
Delaware (the "Trust"), to be issued pursuant to the terms of the Amended and
Restated Declaration of Trust, dated as of April 20, 1999 (the "Amended and
Restated Declaration of Trust"), among Peoples and Wilmington Trust Company, as
Property Trustee and as Delaware Trustee, and the Administrative Trustees named
therein; and (c) the Series B Capital Securities Guarantee Agreement related to
the New Capital Securities (the "New Guarantee") to be executed and delivered by
Peoples for the benefit of the holders from time to time of the New Capital
Securities, we, as your counsel, have examined such corporate records,
certificates and other documents, and such questions of law, as we have
considered necessary or appropriate for the purposes of this opinion. We have
also relied as to certain matters related to Peoples on information obtained
from public officials, officers of Peoples and other sources believed by us to
be responsible.
In our examinations, we have assumed and have not verified (i)
the legal capacity of all natural persons, (ii) the genuineness of all
signatures, (iii) the authenticity of all documents submitted to us as
originals, (iv) the conformity to original documents of all documents submitted
to us as copies and the authenticity of the originals of such latter documents,
and (v) the accuracy and completeness of all corporate records and documents and
of all certificates and statements of fact, in each case given or made available
to us by Peoples. In making our examination of documents executed or to be
executed by parties other than Peoples, we have assumed that such parties had
the power, corporate or other, to enter into and perform all obligations
thereunder, and we have assumed the due authorization by all requisite action,
corporate or other, and valid execution and delivery by such parties of such
documents and the validity, binding effect and enforceability thereof with
respect to such parties.
We have neither examined, nor do we opine upon, any provision
or matter to the extent that the examination or opinion would require a
financial, mathematical or accounting calculation or determination.
Upon the basis of such examination, we advise you that, when:
(i) the Registration Statement on Form S-4
("Registration No. 333-81251), as amended by Pre-Effective Amendment
No. 1 thereto (the "Registration Statement"), relating to the New
Junior Subordinated Debentures, the New Capital Securities and the New
Guarantee has become effective under the 1933 Act;
(ii) the Series B Capital Securities Guarantee
Agreement relating to the New Guarantee with respect to the New Capital
Securities of the Trust has been duly executed and delivered;
(iii) the New Junior Subordinated Debentures have
been duly executed and authenticated in accordance with the Indenture
and issued and delivered as contemplated in the Registration Statement;
and
(iv) the New Capital Securities have been duly
executed in accordance with the Amended and Restated Declaration of
Trust of the Trust and issued and delivered as contemplated in the
Registration Statement,
the New Junior Subordinated Debentures and the New Guarantee relating to the New
Capital Securities of the Trust will constitute valid and legally binding
obligations of Peoples, subject to the limitations, if any, of Title 11 U.S.C.,
as amended, and of the applicable insolvency, reorganization, moratorium or
other laws affecting the enforcement of creditors' rights generally and by
principles of equity. We advise you that certain remedial and other provisions
of the New Junior Subordinated Debentures (and the Indenture under which they
may be issued) and the New Guarantee may be limited by (i) implied covenants of
good faith, fair dealing and commercially reasonable conduct, (ii) judicial
discretion, in the instance of multiple or equitable remedies, and (iii) public
policy.
We understand that you have received an opinion regarding the
New Capital Securities from Richards, Layton & Finger, P.A., special Delaware
counsel for Peoples and the Trust. We are expressing no opinion with respect to
the matters contained in such opinion.
Members of our firm are admitted to the bar in the State of
Ohio and we express no opinion as to the laws of any other jurisdiction other
than the laws of the United States. We note that each of the Indenture, the New
Junior Subordinated Debentures, and the New Guarantee is governed by the laws of
the State of New York. For purposes of this opinion, we have assumed that the
laws of the State of New York are not inconsistent with the laws of Ohio in any
matter material to this opinion.
We hereby consent to the filing of this opinion as an exhibit
to Pre-Effective Amendment No. 1 to the Form S-4 Registration Statement and to
the references to us under the heading "Legal matters" in the Prospectus. In
giving such consent, we do not thereby admit that we are in the category of
persons whose consent is required under Section 7 of the 1933 Act.
Very truly yours,
/s/ VORYS, SATER, SEYMOUR AND PEASE LLP
-----------------------------------
Vorys, Sater, Seymour and Pease LLP
RICHARDS, LAYTON & FINGER LETTERHEAD
July 29, 1999
PEBO Capital Trust I
_ Peoples Bancorp Inc.
138 Putnam Street
Marietta, Ohio 45750
Re: PEBO Capital Trust I
-----------------------------
Ladies and Gentlemen:
We have acted as special Delaware counsel for PEBO Capital
Trust I, a Delaware business trust (the "Trust"), and Peoples Bancorp Inc., an
Ohio corporation (the "Company"), in connection with the matters set forth
herein. At your request, this opinion is being furnished to you.
For purposes of giving the opinions hereinafter set forth, our
examination of documents has been limited to the examination of originals or
copies of the following:
(1) The Certificate of Trust of the Trust (the "Certificate"),
as filed in the office of the Secretary of State of the State
of Delaware (the "Secretary of State") on April 13, 1999;
(2) The Original Declaration of Trust, dated as of April 13, 1999, among
the Company and the trustees named therein;
(3) The Amended and Restated Declaration of Trust (including Annex
1 and the Exhibits thereto), dated as of April 20, 1999 (the
"Declaration of Trust"), among the Company, as Sponsor, the
trustees named therein (the "Trustees") and the holders from time to
time of undivided beneficial interests in the Trust;
(4) The Registration Statement (the "Registration Statement") on
Form S-4, including a preliminary prospectus (the "Prospectus")
relating to the Series B 8.62% Capital Securities of the Trust
representing undivided beneficial interests in the Trust (each, a
"Series B Capital Security" and collectively, the "Series B
Capital Securities"), as filed by the Company and the Trust
with the Securities and Exchange Commission on June 22, 1999; and
(5) A Certificate of Good Standing for the Trust, dated June 21, 1999,
obtained from the Secretary of State.
Initially capitalized terms used herein and not otherwise
defined are used as defined in the Declaration of Trust.
For purposes of this opinion, we have not reviewed any
documents other than the documents listed above, and we have assumed that there
exists no provision in any document that we have not reviewed that bears upon or
is inconsistent with the opinions stated herein. We have conducted no
independent factual investigation of our own but rather have relied solely upon
the foregoing documents, the statements and information set forth therein and
the additional matters recited or assumed herein, all of which we have assumed
to be true, complete and accurate in all material respects.
With respect to all documents examined by us, we have assumed
(i) the authenticity of all documents submitted to us as authentic originals,
(ii) the conformity with the originals of all documents submitted to us as
copies or forms, and (iii) the genuineness of all signatures.
For purposes of this opinion, we have assumed (i) that the
Declaration of Trust constitutes the entire agreement among the parties thereto
with respect to the subject matter thereof, including with respect to the
creation, operation and termination of the Trust, and that the Declaration of
Trust and the Certificate are in full force and effect and have not been
amended, (ii) except to the extent provided in paragraph 1 below, the due
creation or due organization or due formation, as the case may be, and valid
existence in good standing of each party to the documents examined by us under
the laws of the jurisdiction governing its creation, organization or formation,
(iii) the legal capacity of natural persons who are parties to the documents
examined by us, (iv) that each of the parties to the documents examined by us
has the power and authority to execute and deliver, and to perform its
obligations under, such documents, (v) the due authorization, execution and
delivery by all parties thereto of all documents examined by us, (vi) the
receipt by each Person to whom a Series B Capital Security is to be issued by
the Trust (collectively, the "Series B Capital Security Holders") of a Series B
Capital Security Certificate for such Series B Capital Security in exchange for
a Series A Capital Security, in accordance with the Declaration of Trust and the
Prospectus, and (vii) that the Series B Capital Securities will be executed,
authenticated and issued to the Series B Capital Security Holders in accordance
with the Declaration of Trust and the Prospectus. We have not participated in
the preparation of the Registration Statement or the Prospectus and assume no
responsibility for their contents.
This opinion is limited to the laws of the State of Delaware
(excluding the securities laws of the State of Delaware), and we have not
considered and express no opinion on the laws of any other jurisdiction,
including federal laws and rules and regulations relating thereto. Our opinions
are rendered only with respect to Delaware laws and rules, regulations and
orders thereunder which are currently in effect.
Based upon the foregoing, and upon our examination of such
questions of law and statutes of the State of Delaware as we have considered
necessary or appropriate, and subject to the assumptions, qualifications,
limitations and exceptions set forth herein, we are of the opinion that:
1. The Trust has been duly created and is validly
existing in good standing as a business trust under the Delaware Business
Trust Act, 12 Del. C. ss. 3801, et seq.
2. The Series B Capital Securities will represent valid and,
subject to the qualifications set forth in paragraph 3 below, fully paid and
nonassessable undivided beneficial interests in the assets of the Trust.
3. The Series B Capital Security Holders, as beneficial owners
of the Trust, will be entitled to the same limitation of personal liability
extended to stockholders of private corporations for profit organized under the
General Corporation Law of the State of Delaware. We note that the Series B
Capital Security Holders may be obligated to make payments as set forth in the
Declaration of Trust.
We consent to the filing of this opinion with the Securities
and Exchange Commission as an exhibit to the Registration Statement. In
addition, we hereby consent to the use of our name under the heading "Legal
Matters" in the Prospectus. In giving the foregoing consents, we do not thereby
admit that we come within the category of Persons whose consent is required
under Section 7 of the Securities Act of 1933, as amended, or the rules and
regulations of the Securities and Exchange Commission thereunder.
Very truly yours,
/s/ ERIC A. MAZIE
--------------
Eric A. Mazie
VORYS, SATER, SEYMOUR AND PEASE LLP
LETTERHEAD
July 30, 1999
Board of Directors
Peoples Bancorp Inc.
138 Putnam Street
Marietta, Ohio 45750
Ladies and Gentlemen:
As special federal tax counsel to PEBO Capital Trust I (the
"Trust") and Peoples Bancorp Inc. ("Peoples") in connection with the exchange
offer by the Trust of up to $30,000,000 of its Series B 8.62% Capital Securities
pursuant to the prospectus (the "Prospectus") contained in Pre-Effective
Amendment No. 1 to the Form S-4 Registration Statement (Registration No.
333-81251) for the exchange offer, and assuming the operative documents
described in the Prospectus will be performed in accordance with the terms
described therein, we hereby confirm to you our opinion as set forth under the
heading "Certain federal income tax consequences" in the Prospectus, subject to
the limitations set forth therein.
We hereby consent to the filing of this opinion as an exhibit
to Pre-Effective Amendment No. 1 to the Form S-4 Registration Statement and to
the references to us under the heading, "Certain federal income tax
consequences" and "Legal matters" in the Prospectus. In giving such consent, we
do not thereby admit that we are in the category of persons whose consent is
required under Section 7 of the Securities Act of 1933.
Very truly yours
/s/ VORYS, SATER, SEYMOUR AND PEAS LLP
-----------------------------------
Vorys, Sater, Seymour and Pease LLP
EXHIBIT 12.0
PEOPLES BANCORP INC.
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(Dollars in Thousands)
Three Months Ended
March 31,
--------------------
1999 1998
--------- ----------
Pre-tax income from continuing operations $ 3,814 $ 3,556
Fixed Charges:
Interest expense and amortization of debt
discount and premium on all indebtedness 7,242 7,320
Amortized portion of rentals 25 15
--------- ----------
--------- ----------
7,267 7,335
--------- ----------
Earnings before income taxes and fixed charges $ 11,081 $ 10,891
--------- ----------
Ratio of Earnings to Fixed Charges:
Including Interest on Deposits 1.52x 1.48x
Excluding Interest on Deposits (A) 5.65x 4.51x
<TABLE>
<CAPTION>
Years Ended December 31,
------------------------------------------------------------
1998 1997 1996 1995 1994
----------- ----------- ------------ ---------- ----------
<S> <C> <C> <C> <C> <C>
Pre-tax income from continuing operations $ 14,785 $ 12,704 $ 11,122 $ 8,639 $ 8,08
Fixed Charges:
Interest expense and amortization of debt
discount and premium on all indebtedness 30,497 25,216 21,966 20,777 15,424
Amortized portion of rentals 79 52 56 56 68
----------- ----------- ------------ ---------- ----------
30,576 25,268 22,022 20,833 15,492
----------- ----------- ------------ ---------- ----------
Earnings before income taxes and fixed charges $ 45,361 $ 37,972 $ 33,144 $ 29,472 $ 23,573
----------- ----------- ------------ ---------- ----------
Ratio of Earnings to Fixed Charges:
Including Interest on Deposits 1.48x 1.50x 1.51x 1.41x 1.52x
Excluding Interest on Deposits (A) 4.27x 5.25x 4.54x 4.53x 5.31x
</TABLE>
NOTES:
(A) The following is a summary of interest expense on deposits for each of the
periods presented:
Three months ended Year ended
March 31, December 31,
- ------------------------------ ------------------------
1999 $6,446 1998 $26,051
1998 $6,321 1997 $22,282
1996 $18,880
1995 $18,384
1994 $13,616
