[Silver and Silver Letterhead]
November 11, 1998
Board of Directors
Ogdensburg Federal Savings & Loan Association
825 State Street
Ogdensburg, New York 13669
Board Members:
You have requested the opinion of Silver and Silver as
to the New York State franchise and New York State personal
income tax consequences relating to the proposed conversion of
Ogdensburg Federal Savings and Loan Association from a federally
chartered mutual savings and loan association to a federally
chartered stock savings and loan association (the "Stock
Association") and the formation of Peoples Bankcorp, Inc. which
will acquire all of the outstanding stock of the Stock
Association.
You have submitted to us a copy of the federal income tax
opinion ("Federal Opinion") relating to the federal income tax
consequences of the proposed transaction prepared by your
counsel, Housley Kantarian & Bronstein, P.C. and dated November
10, 1998.
Our opinion regarding the New York State franchise and New
York State personal income tax consequences of the proposed
transaction is based on the same facts, assumptions and
conditions contained in the Federal Opinion. It is also based
on existing New York Tax Law which is subject to change. We
have not reviewed the legal documents necessary to effectuate
the steps to be undertaken, and we assume that all steps will
be properly effectuated under state and federal law and will be
consistent with the legal documentation.
In our opinion, the New York State franchise and New York
State personal income tax consequences of the proposed
transaction are consistent with the federal income tax
consequences of the proposed transaction opined upon in the
Federal Opinion.
For purposes of the franchise tax the State of New York
has adopted federal taxable income (Internal Revenue Code Sec.
63), as currently amended, as the starting point for computing
New York entire net income (NYS Tax Law Sec. 1453). Franchise
tax terms are defined in relation to the Internal Revenue Code
of 1986, as amended. Taxpayers are required to use federal
taxable income as the starting point for the computation of
entire net income.
Page 2 November 11, 1998
To: Board of Directors
Ogdendsburg Federal Savings and Loan Association
Several specific modifications to federal taxable income
are enumerated in the New York Tax Law and the Banking
Corporation Regulations in determining income taxable for New
York State franchise tax purposes, however there are no specific
modifications which apply to the proposed transaction (see New
York State Tax Law Article 32, Sections 1453 (b) through (m) and
Regulation Sections 18-2.3, 18-2.4 and 18-2.5 of the Franchise
Tax on Banking Corporations).
The State of New York has adopted federal adjusted gross
income (IRC Sec. 62), as currently amended, as the starting
point for computing New York taxable income (NYS Tax Law Sec.
612) for personal income tax purposes. Income tax terms are
defined in relation to the Internal Revenue Code of 1986, as
amended.
Several specific modifications to federal taxable income
are enumerated in the New York Statutes in determining income
taxable for New York State personal income tax purposes, however
there are no specific modifications which apply to the proposed
transaction (see New York State Tax Law Article 22, Sections 612
(b) through (t) and Regulation Sections 112.2 through 112.13 of
the Personal Income Tax).
Our opinion as expressed above is rendered only with
respect to the New York franchise and New York State personal
income tax consequences of specific matters discussed herein,
and we express no opinion with respect to any other New York
franchise, income or transfer tax matter or any other federal,
state, local or foreign tax matter relating to the proposed
transaction. Our opinion is based on the facts and conditions
as stated herein, whether directly or by reference to the
Federal Opinion. It is expressly understood and agreed to by
Ogdensburg Federal Savings and Loan Association, the Stock
Association, and Peoples Bankcorp, Inc. that Silver and Silver
is relying solely on the Federal Opinion in all respects
relating to the federal tax consequences of the matters
described herein. Silver and Silver has not independently
verified the accuracy of any fact, representation, opinion or
other matter contained in the Federal Tax Opinion and should any
fact, representation, opinion or other matter addressed therein
not be correct, it could cause the New York State franchise and
income tax opinion contained herein to also be incorrect. If
any of the facts and conditions are not entirely complete or
accurate, it is imperative that we be informed immediately, as
the inaccuracy or incompleteness could have a material effect on
our conclusions. In rendering our opinion, we are relying upon
the relevant provisions of the Internal Revenue Code of 1986,
as amended, and New York Statutes, as amended, the regulations
and rules thereunder and judicial and administrative
interpretations thereof, which are subject to change or
modification by subsequent legislative, regulatory,
administrative, or judicial decisions. Any such changes could
also have an effect on the validity of our opinion. We
undertake no responsibility to update or supplement our opinion
after its issuance. This opinion is not binding upon any tax
authority or any court and no assurance can be given that a
position contrary to that expressed herein will not be asserted
by a tax authority and ultimately sustained by a court.
Page 3 November 11, 1998
To: Board of Directors
Ogdendsburg Federal Savings and Loan Association
We hereby consent to the filing of this opinion with the
OTS as an exhibit to the Application H-(e)1-S filed by the
Company with the OTS in connection with the Conversion
and the reference to our firm in the Application H-(e)1-S under
Item 110.55 therein.
We also hereby consent to the filing of this opinion with
the SEC and the OTS as exhibits to the Registration Statement
and Form AC, respectively, and the references to our firm in the
Prospectus, which is a part of the Registration Statement and
Form AC, under the headings "The Conversion -- Effect of
Conversion to Stock Form on Depositors and Borrowers of
Ogdensburg Federal Savings and Loan Association -- Tax Effects"
and "Legal and Tax Matters."
Very truly yours,
SILVER AND SILVER
/s/ George E. Silver
--------------------------------
George E. Silver