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PEOPLES COMMUNITY BANCSHARES, INC.
 4,000 Capital Securities
 Fixed/Floating Rate Capital Securities
(Liquidation Amount $1,000.00 per Capital Security)
 PLACEMENT AGREEMENT
 
  
 
   Section 1. Issuance and Sale of Securities.
 1.1. Introduction. Exhibit A
 1.2. Operative Agreements.




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1.3. Rights of Purchaser.
 1.4. Legends.
 Section 2. Purchase of Capital Securities.
 2.1. Exclusive Rights; Purchase Price.
 2.2. Subscription Agreement.
 2.3. Closing and Delivery of Payment.
 2.3.1. Closing; Closing Date. provided however
 2.3.2. Delivery .
 2.3.3. Transfer Agent.
 2




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2.4. Costs and Expenses.
 2.5. Failure to Close.
 Section 3. Closing Conditions.
 3.1. Opinions of Counsel. Exhibit B-1 Exhibit B-2 Exhibit B-3 Exhibit B-3
 3




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3.2. Officers Certificate.
 3.3. Administrators Certificate.
 3.4. Purchase Permitted by Applicable Laws; Legal Investment.
 3.5. Consents and Permits.
 3.6. Information.
  Section 4. Conditions to the Offerors Obligations.
 4.1. Executed Agreement.
 4




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4.2. Fulfillment of Other Obligations.
 Section 5. Representations and Warranties of the Offerors.
 5.1. Securities Law Matters.
 (a)
 (b)
 (c)
 (d)
 (e)
 5.2. Organization, Standing and Qualification of the Trust.
 5.3. Trust Agreement.
 5




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5.4. Guarantee Agreement and the Indenture.
 5.5. Capital Securities and Common Securities.
 5.6. Debentures.
 5.7. Power and Authority.
 5.8. No Defaults.
 6




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5.9. Organization, Standing and Qualification of the Company.
 5.10. Subsidiaries of the Company. Exhibit C
 5.11. Permits.
 5.12. Conflicts, Authorizations and Approvals.
 5.13. Holding Company Registration and Deposit Insurance.
 7




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5.14. Financial Statements.
 (a)
 (b)
 (c)
 (d)
 5.15. Exchange Act Reporting.
 5.16. Regulatory Enforcement Matters.
 8




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5.17. No Material Change.
 5.18. No Undisclosed Liabilities.
 5.19. Litigation.
 5.20. Deferral of Interest Payments on Debentures. pari passu
 9




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Section 6. Representations and Warranties of the Placement Agents.
 6.1. Organization, Standing and Qualification.
 (a)
 (b)
 6.2. Power and Authority.
 6.3. General Solicitation.
 6.4. Purchaser.
 6.5. Qualified Purchasers.
 6.6. Offering Circulars.
 10




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Section 7. Covenants of the Offerors.
 7.1. Compliance with Representations and Warranties.
 7.2. Sale and Registration of Securities.
 7.3. Use of Proceeds.
 7.4. Investment Company.
 7.5. Reimbursement of Expenses .
 7.6. Solicitation and Advertising.
 7.7. Compliance with Rule 144A(d)(4) under the Securities Act.
 11




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7.8. Transfer Notice.
 7.9. Quarterly Reports.
 Section 8. Covenants of the Placement Agents.
 Section 9. Indemnification.
 9.1. Indemnification Obligation.
 12




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9.2. Conduct of Indemnification Proceedings.
 9.3. Contribution.
 13




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9.4. Additional Remedies.
 9.5. Additional Indemnification.
 Section 10. Rights and Responsibilities of Placement Agents.
 10.1. Reliance.
 14




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10.2. Rights of Placement Agents.
 Section 11. Miscellaneous.
 11.1. Disclosure Schedule.
 11.2. Legal Expenses.
 11.3. Non-Disclosure.
 11.4. Notices.
 15




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FTN Financial Capital Markets845 Crossover Lane, Suite 150Memphis, Tennessee 38117Telecopier: 901-435-4706Telephone: 800-456-5460Attention: James D. WingettandKeefe, Bruyette & Woods, Inc.787 7th Avenue4th FloorNew York, New York 10019Telecopier: 212-403-2000Telephone: 212-403-1004Attention: Mitchell Kleinman, General Counsel
  Lewis, Rice & Fingersh, L.C.500 North Broadway, Suite 2000St. Louis, Missouri 63102Telecopier: 314-241-6056Telephone: 314-444-7600Attention: Thomas C. Erb, Esq.andSidley Austin Brown & Wood LLP787 7th AvenueNew York, New York 10019Telecopier: 212-839- 5599Telephone: 212-839-5300Attention: Renwick Martin, Esq.
  Peoples Community Bancshares, Inc.25 South Links AvenueSarasota, Florida 34236Telecopier: 941-955-6578Telephone: 941-373-0426Attention: Dorothy S. Barth
 16




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Smith Mackinnon, P.A.Citrus Center255 South Orange Avenue, Suite 800Orlando, Florida 32081Telecopier: 407-843-2448Telephone: 407-843-7300Attention: John P. Greeley, Esq.
  11.5. Parties in Interest, Successors and Assigns.
 11.6. Counterparts.
 11.7. Headings.
 11.8. Governing Law.
 11.9. Entire Agreement.
 11.10. Severability.
 17




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11.11. Survival.
 Signatures appear on the following page
 18




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Very truly yours,PEOPLES COMMUNITY BANCSHARES, INC.By:
    
    /s/ Dorothy S. BarthName:
    
    Dorothy S. BarthTitle:
    
    CFOPEOPLES COMMUNITY STATUTORY TRUST IBy:
    
    /s/ Dorothy S. BarthName:
    
    Dorothy S. BarthTitle:
    
    Administrator
 CONFIRMED AND ACCEPTED,as of the date first set forth aboveFTN FINANCIAL CAPITAL MARKETS,a division of First Tennessee Bank National Association,as a Placement AgentBy:
    
    /s/ James D. WingettName:
    
    James D. WingettTitle:
    
    Senior Vice PresidentKEEFE, BRUYETTE & WOODS, INC.,a New York corporation, as a Placement AgentBy:
    
    /s/ Peter J. WirthName:
    
    Peter J. WirthTitle:
    
    Managing Director
 19




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EXHIBIT A
 FORM OF SUBSCRIPTION AGREEMENT
 PEOPLES COMMUNITY STATUTORY TRUST I
PEOPLES COMMUNITY BANCSHARES, INC.
 SUBSCRIPTION AGREEMENT
 December 15, 2005
 THIS SUBSCRIPTION AGREEMENT et seq
 RECITALS:
 A.
 B.
 C.
 ARTICLE I
 PURCHASE AND SALE OF CAPITAL SECURITIES
   A-1




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ARTICLE II
 REPRESENTATIONS AND WARRANTIES OF PURCHASER
      A-2




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ERISA ERISA Plan Code Plan Similar Law PTCE
 ab initio
 A-3




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ARTICLE III
 MISCELLANEOUS
  To the Offerors:
    
    Peoples Community Bancshares, Inc.25 South Links AvenueSarasota, Florida 34236Attention: Dorothy S. BarthFax: 941-955-6578To the Purchaser:
    
    First Tennessee Bank National Association845 Crossover Lane, Suite 150Memphis, Tennessee 38117Attention: David WorkFax: 901-435-7983
   A-4




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Signatures appear on the following page
 A-5




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IN WITNESS WHEREOF
 FIRST TENNESSEE BANK NATIONAL ASSOCIATIONBy:Print Name:Title:
 PEOPLES COMMUNITY BANCSHARES, INC.By:Name:Title:PEOPLES COMMUNITY STATUTORY TRUST IBy:Name:Title:
    
    Administrator
 A-6




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EXHIBIT A TO SUBSCRIPTION AGREEMENT
 MASTER CUSTODIAN AGREEMENT
  RECITALS
     Joinder Agreement
 Delivery of Securities
   A-A-1




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Timing of Release from Custody
    Concerning the Custodian
   A-A-2




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Compensation, Expense Reimbursement and Indemnification.
    Voting Rights.
 Resignation
 A-A-3




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Dispute Resolution
 Consent to Jurisdiction and Service
 Force Majeure
 Notices.
     
 A-A-4




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Miscellaneous.
 Binding Effect
 Modifications.
 Governing Law
 Reproduction of Documents.
 Counterparts.
 signatures appear on the following page
 A-A-5




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WILMINGTON TRUST COMPANYBy:
    
    /s/ Christopher J. SlaybaughPrint Name: Christopher J. SlaybaughTitle: Financial Services Officer
 A-A-6




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EXHIBIT A TO MASTER CUSTODIAN AGREEMENT
 FORM OF JOINDER AGREEMENT
   RECITALS
     Joinder.
 Notice.
 
  
 Termination
 A-A-A-1




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Entire Agreement
  PEOPLES COMMUNITY BANCSHARES, INC.By:Name:Title:FIRST TENNESSEE BANK NATIONAL
ASSOCIATIONBy:Name:Title:
 A-A-A-2




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EXHIBIT B TO MASTER CUSTODIAN AGREEMENT
 FORM OF TRANSFER NOTICE
  
  
  
 FIRST TENNESSEE BANK NATIONAL ASSOCIATIONBy:Name:Title:
 cc:
    
    Peoples Community Bancshares, Inc.Wilmington Trust Company, as Trustee
 A-A-B-1




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EXHIBIT B-1
 FORM OF COMPANY COUNSEL OPINION
  First Tennessee Bank National Association
    
    FTN Financial Capital Markets845 Crossover Lane, Suite 150
    
    845 Crossover Lane, Suite 150Memphis, Tennessee 38117
    
    Memphis, Tennessee 38117Wilmington Trust Company
    
    Keefe, Bruyette & Woods, Inc.Rodney Square North
    
    787 7th Avenue, 4th Floor1100 North Market Street
    
    New York, New York 10019Wilmington, Delaware 19890-1600
        B-1-1




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B-1-2




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B-1-3




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Very truly yours,  B-1-4




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EXHIBIT B-2
 FORM OF DELAWARE COUNSEL OPINION
 
 Peoples Community Statutory Trust I
            B-2-1




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B-2-2




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B-2-3




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B-2-4




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Circular 230 Notice.
   Very truly yours, B-2-5




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SCHEDULE A
      B-2-6




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EXHIBIT B-3
 TAX COUNSEL OPINION ITEMS
 1.
    
    The Debentures will be classified as indebtedness of the Company for U.S. federal income tax
purposes.2.
    
    The Trust will be characterized as a grantor trust and not as an association taxable as a
corporation for U.S. federal income tax purposes.
 B-3-1




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Re:
    
    Representations Concerning the Issuance of Junior Subordinated Deferrable
Interest Debentures (the Debentures) to Peoples Community Statutory Trust I (the
Trust) and Sale of Trust Securities (the Trust Securities) of the Trust
           B-3-2




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pari passu
       Very truly yours,PEOPLES COMMUNITY BANCSHARES, INC.Date: December 14, 2005
    
    By:Title:
 B-3-3




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EXHIBIT C
 SIGNIFICANT SUBSIDIARIES
  C-1




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EXHIBIT D
 FORM OF QUARTERLY REPORT
 
   Tier 1 to Risk Weighted Assets
    
    
    
    %Ratio of Double Leverage
    
    
    
    %Non-Performing Assets to Loans and OREO
    
    
    
    %Ratio of Reserves to Non-Performing Loans
    
    
    
    %Ratio of Net Charge-Offs to Loans
    
    
    
    %Return on Average Assets (annualized)**
    
    
    
    %Net Interest Margin (annualized)**
    
    
    
    %Efficiency Ratio
    
    
    
    %Ratio of Loans to Assets
    
    
    
    %Ratio of Loans to Deposits
    
    
    
    %Total Assets
    
    $Year to Date Income
    
    $
 
 *
    
    A table describing the quarterly report calculation procedures is provided on page D-2**
    
    To annualize Return on Average Assets and Net Interest Margin do the following:1st
    
    Quarter-multiply income statement item by 4, then divide by
balance sheet item(s)2nd
    
    Quarter-multiply income statement item by 2,then divide by balance
sheet item(s)3rd
    
    Quarter-divide income statement item by 3, then multiply by 4, then divide by
balance sheet item(s)4th
    
    Quarter-should already be an annual number  D-1




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Corresponding FRY-9C or LP Line ItemsReport Item
    
    with Line Item corresponding Schedules
    
    Description of CalculationTier 1 Capital to
Risk Weighted
Assets
    
    BHCK7206Schedule HC-R
    
    Tier 1 Risk Ratio: Core Capital (Tier 1)/ Risk-
Adjusted AssetsRatio of Double
Leverage
    
    (BHCP0365)/(BHCP3210)Schedule PC in the LP
    
    Total equity investments in subsidiaries divided
by the total equity capital. This field is calculated
at the parent company level. Subsidiaries
include bank, bank holding company, and
nonbank subsidiaries.Non-Performing
Assets to Loans
and OREO
    
    (BHCK5525-BHCK3506+BHCK5526-
BHCK3507+BHCK2744)/(BHCK2122+BHCK2
744) Schedules HC-C, HC-M & HC-N
    
    Total Nonperforming Assets (NPLs+Foreclosed
Real Estate+Other Nonaccrual & Repossessed
Assets)/ Total Loans + Foreclosed Real EstateRatio of Reserves
to Non-Performing
Loans
    
    (BHCK3123+BHCK3128)/(BHCK5525-
BHCK3506+BHCK5526-BHCK3507)Schedules HC & HC-N
    
    Total Loan Loss and Allocated Transfer Risk
Reserves/ Total Nonperforming Loans
(Nonaccrual + Restructured)Ratio of Net
Charge-Offs to
Loans
    
    (BHCK4635-BHCK4605)/(BHCK3516)Schedules HI-B & HC-K
    
    Net charge offs for the period as a percentage of
average loans.Return on Assets
    
    (BHCK4340/BHCK3368)Schedules HI & HC-K
    
    Net Income as a percentage of Assets.Net Interest 
Margin
    
    (BHCK4519)/(BHCK3515+BHCK3365+BHCK
3516+BHCK3401+BHCKB985)Schedules HI Memorandum and HC-K
    
    (Net Interest Income Fully Taxable Equivalent, if
available / Average Earning Assets)Efficiency Ratio
    
    (BHCK4093)/(BHCK4519+BHCK4079)Schedule HI
    
    (Noninterest Expense)/ (Net Interest Income
Fully Taxable Equivalent, if available, plus
Noninterest Income)Ratio of Loans to
Assets
    
    (BHCKB528+BHCK5369)/BHCK2170)
Schedule HC
    
    Total Loans & Leases (Net of Unearned Income &
Gross of Reserve)/ Total AssetsRatio of Loans to
Deposits
    
    (BHCKB528+BHCK5369)/(BHDM6631+BHD
M6636+BHFN6631+BHFN6636)Schedule HC
    
    Total Loans & Leases (Net of Unearned Income &
Gross of Reserve)/ Total Deposits (Includes
Domestic and Foreign Deposits)Total Assets
    
    (BHCK2170)Schedule HC
    
    The sum of total assets. Includes cash and
balances due from depository institutions;
securities; federal funds sold and securities
purchased under agreements to resell; loans and
lease financing receivables; trading assets;
premises and fixed assets; other real estate owned;
investments in unconsolidated subsidiaries and
associated companies; customers liability on
acceptances outstanding; intangible assets; and
other assets.Net Income
    
    (BHCK4300)Schedule HI
    
    The sum of income (loss) before extraordinary
items and other adjustments and extraordinary
items; and other adjustments, net of income taxes.
 D-2