# EDGAR Filing Document

**Accession Number:** 0001967306
**File Stem:** 0001104659-23-031020
**Filing Date:** 2023-3
**Character Count:** 1407643
**Document Hash:** 7c444b354a6b3fd48b007a2cd1d4f468
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001104659-23-031020.hdr.sgml**: 20230310

**ACCESSION NUMBER**: 0001104659-23-031020

**CONFORMED SUBMISSION TYPE**: S-1

**PUBLIC DOCUMENT COUNT**: 60

**FILED AS OF DATE**: 20230310

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Mercer Bancorp, Inc.
- **CENTRAL INDEX KEY:** 0001967306
- **IRS NUMBER:** 000000000
- **STATE OF INCORPORATION:** MD
- **FISCAL YEAR END:** 0930

**FILING VALUES:**
- **FORM TYPE:** S-1
- **SEC ACT:** 1933 Act
- **SEC FILE NUMBER:** 333-270445
- **FILM NUMBER:** 23722688

**BUSINESS ADDRESS:**
- **STREET 1:** 1100 IRMSCHER BLVD
- **CITY:** CELINA
- **STATE:** OH
- **ZIP:** 45822
- **BUSINESS PHONE:** (419) 586-5158

**MAIL ADDRESS:**
- **STREET 1:** 1100 IRMSCHER BLVD
- **CITY:** CELINA
- **STATE:** OH
- **ZIP:** 45822

**As filed with the Securities and Exchange Commission on March 10, 2023**

**Registration No. 333-________**

**UNITED STATES SECURITIES AND EXCHANGE COMMISSION**

**WASHINGTON, D.C. 20549**

**FORM S-1**

**REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933**

**Mercer Bancorp, Inc.**

(Exact Name of Registrant as Specified in Its Charter)

---

| | | |
|:---|:---|:---|
| **Maryland** | **6036** | **Applied for** |
| (State or Other Jurisdiction of | (Primary Standard Industrial | (I.R.S. Employer |
| Incorporation or Organization) | Classification Code Number) | Identification Number) |

---

**1100 Irmscher Blvd**

**Celina, Ohio 45822**

(419) 586-5158

(Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant's Principal Executive Offices)

**Alvin B. Parmiter**

**President and Chief Executive Officer**

**Mercer Bancorp, Inc.**

**1100 Irmscher Blvd**

**Celina, Ohio 45822**

(419) 586-5158

(Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent for Service)

**Copies to:**

---

| | |
|:---|:---|
| **Kip A. Weissman, Esq.** | **Robert D. Klingler, Esq.** |
| **Elizabeth A. Cook, Esq.** | **John M. Willis, Esq.** |
| **Luse Gorman, PC** | **Nelson Mullins Riley & Scarborough LLP** |
| **5335 Wisconsin Avenue, N.W., Suite 780** | **201 17th Street NW, Suite 1700** |
| **Washington, D.C. 20015** | **Atlanta, GA 30363** |
| **(202) 274-2000** | **(404) 322-6000** |

---

**Approximate date of commencement of proposed sale to the public:** As soon as practicable after this registration statement becomes effective.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box: ⌧

If this Form is filed to register additional shares for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: ◻

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: ◻

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering: ◻

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act:

Large accelerated filer ◻ Accelerated filer ◻ <br> Non-accelerated filer ⌧ Smaller reporting company ⌧ <br> Emerging growth company ⌧

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act: ◻

**The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.**

**PROSPECTUS**

![](tm238570d1_s1-img01.jpg)

**(Proposed Holding Company for Mercer Savings Bank)**

**Up to 1,495,000 Shares of Common Stock**

**(Subject to Increase to up to 1,719,250 Shares)**

Mercer Bancorp, Inc., referred to as "Mercer Bancorp" throughout this prospectus, is offering shares of common stock for sale at $10.00 per share in connection with the conversion of Mercer Savings Bank from the mutual form of organization to the stock form of organization. In addition to the shares of common stock offered for sale in the stock offering, we intend to contribute 50,000 shares of common stock and $100,000 in cash to a charitable foundation we intend to establish in connection with the conversion and stock offering. There is currently no market for our common stock. We expect our common stock to be quoted on the OTCQB Market operated by OTC Markets Group upon the completion of the conversion and stock offering. We are an "emerging growth company" as defined in the Jumpstart Our Business Startups Act of 2012, referred to as the JOBS Act throughout this prospectus.

The shares of common stock are first being offered for sale in a subscription offering to eligible depositors and borrowers of Mercer Savings Bank and to tax-qualified employee benefit plans of Mercer Savings Bank. Shares not purchased in the subscription offering may be offered for sale to the general public in a community offering, with a preference given to natural persons (including trusts of natural persons) residing in Mercer and Darke Counties in Ohio and Adams and Jay Counties in Indiana. Any shares of common stock not purchased in the subscription offering or the community offering may be offered for sale to the public through a syndicate of broker-dealers, referred to as the "syndicated community offering" throughout this prospectus. The syndicated community offering, if held, may commence before the subscription offering and the community offering (including any extensions) have expired. However, no shares purchased in the subscription offering or the community offering will be issued until the completion of any syndicated community offering. We may sell up to 1,719,250 shares of common stock because of demand for the shares of common stock or changes in market conditions, without resoliciting subscribers. We must sell a minimum of 1,105,000 shares to complete the conversion and stock offering.

The minimum purchase order is 25 shares. Generally, no individual, or individuals acting through a single qualifying account held jointly, may purchase more than 20,000 shares ($200,000) of common stock, and no person or entity, together with associates or persons acting in concert with such person or entity, may purchase more than 40,000 shares ($400,000) of common stock in all categories of the stock offering combined.

The subscription offering will expire at 5:00 p.m., Eastern time, on [expiration date]. We expect that the community offering, if held, will expire at the same time. We may extend the expiration date of the subscription offering and any community offering without notice to you until [extended expiration date], or longer if the Superintendent of the Ohio Division of Financial Institutions, referred to as the "ODFI" throughout this prospectus, and the Federal Deposit Insurance Corporation, referred to as the "FDIC" throughout this prospectus, approve a later date. No single extension may exceed 90 days and the stock offering must be completed by [final extension date]. Once submitted, orders are irrevocable unless the subscription offering and/or the community offering are terminated or extended, with regulatory approval, beyond [extended expiration date], or the number of shares of common stock to be sold is increased to more than 1,719,250 shares or decreased to less than 1,105,000 shares. If the subscription offering and any community offering are extended beyond [extended expiration date], all subscribers will be notified and given the opportunity to confirm, change or cancel their orders. If you do not respond to the notice of extension, we will promptly return your funds with interest or cancel your deposit account withdrawal authorization. If the number of shares to be sold in the stock offering is increased to more than 1,719,250 shares or decreased to less than 1,105,000 shares, we will resolicit subscribers, and all funds delivered to us to purchase shares of common stock in the subscription offering and any community offering will be returned promptly with interest. Funds received in the subscription offering and any community offering will be held in a segregated account at Mercer Savings Bank and will earn interest at 0.05% per annum until completion or termination of the stock offering.

Performance Trust Capital Partners, LLC, referred to as "Performance Trust" throughout this prospectus, will assist us in selling our shares of common stock on a best efforts basis in the subscription offering and any community offering, and will serve as sole manager for any syndicated community offering. Performance Trust is not required to purchase any shares of common stock we are offering for sale.

**OFFERING SUMMARY**

**Price: $10.00 per share**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Minimum** | **Midpoint** | **Maximum** | **Adjusted<br> Maximum** |
| Number of shares | 1105000 | 1300000 | 1495000 | 1719250 |
| Gross offering proceeds | $11050000 | $13000000 | $14950000 | $17192500 |
| Estimated offering expenses, excluding selling agent fees and expenses <sup>(1)</sup> | $1365000 | $1365000 | $1365000 | $1365000 |
| Selling agent fees and expenses <sup>(1) (2)</sup> | $385000 | $385000 | $385000 | $385000 |
| Estimated net proceeds | $9300000 | $11250000 | $13200000 | $15443000 |
| Estimated net proceeds per share | $8.42 | $8.65 | $8.83 | $8.98 |

---

<sup>(1)</sup> See "The Conversion and Stock Offering – Plan of Distribution; Selling Agent and Underwriter Compensation" for a discussion of Performance Trust's compensation for this stock offering including any compensation to be received by Performance Trust and other broker-dealers for any syndicated community offering.

<sup>(2)</sup> Excludes records agent fees and expenses payable to Performance Trust, which are included in estimated offering expenses. See "The Conversion and Stock Offering – Records Agent and Stock Information Center Management."

**This investment involves a degree of risk, including the possible loss of principal.**

**See "Risk Factors" beginning on page 13.**

*These securities are not deposits or accounts and are not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Neither the Securities and Exchange Commission, the Ohio Division of Financial Institutions, the Federal Deposit Insurance Corporation, the Board of Governors of the Federal Reserve System nor any state securities regulator has approved or disapproved of these securities or determined if this prospectus is accurate or complete. Any representation to the contrary is a criminal offense.*

PERFORMANCE TRUST

CAPITAL PARTNERS

For assistance, contact the Stock Information Center at [information center number].

The date of this prospectus is [prospectus date].

![](tm238570d1_s1-img02.jpg)

**TABLE OF CONTENTS**

---

| | |
|:---|:---|
|  | Page |
| **[SUMMARY](#a_001)** | **[1](#a_001)** |
| **[RISK FACTORS](#a_002)** | **[13](#a_002)** |
| **[SELECTED FINANCIAL AND OTHER DATA OF MERCER SAVINGS BANK](#a_003)** | **[26](#a_003)** |
| **[FORWARD-LOOKING STATEMENTS](#a_004)** | **[28](#a_004)** |
| **[HOW WE INTEND TO USE THE PROCEEDS FROM THE STOCK OFFERING](#a_005)** | **[30](#a_005)** |
| **[OUR DIVIDEND POLICY](#a_006)** | **[31](#a_006)** |
| **[MARKET FOR THE COMMON STOCK](#a_007)** | **[32](#a_007)** |
| **[HISTORICAL AND PRO FORMA REGULATORY CAPITAL COMPLIANCE](#a_008)** | **[33](#a_008)** |
| **[CAPITALIZATION](#a_009)** | **[34](#a_009)** |
| **[PRO FORMA DATA](#sp2_001)** | **[35](#sp2_001)** |
| **[COMPARISON OF VALUATION AND PRO FORMA INFORMATION WITH AND WITHOUT THE CHARITABLE FOUNDATION](#sp2_002)** | **[40](#sp2_002)** |
| **[MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](#sp2_003)** | **[43](#sp2_003)** |
| **[BUSINESS OF MERCER BANCORP](#sp2_004)** | **[58](#sp2_004)** |
| **[BUSINESS OF MERCER SAVINGS BANK](#sp2_005)** | **[58](#sp2_005)** |
| **[REGULATION AND SUPERVISION](#k_001)** | **[78](#k_001)** |
| **[TAXATION](#k_002)** | **[86](#k_002)** |
| **[MANAGEMENT](#k_003)** | **[88](#k_003)** |
| **[SUBSCRIPTIONS BY DIRECTORS AND EXECUTIVE OFFICERS](#k_004)** | **[96](#k_004)** |
| **[THE CONVERSION AND STOCK OFFERING](#k_005)** | **[98](#k_005)** |
| **[CHARITABLE FOUNDATION](#k_006)** | **[117](#k_006)** |
| **[RESTRICTIONS ON ACQUISITION OF MERCER BANCORP](#k_007)** | **[120](#k_007)** |
| **[DESCRIPTION OF CAPITAL STOCK OF MERCER BANCORP](#sub_001)** | **[125](#sub_001)** |
| **[TRANSFER AGENT](#sub_002)** | **[126](#sub_002)** |
| **[EXPERTS](#sub_003)** | **[126](#sub_003)** |
| **[CHANGE IN AUDITOR](#sub_004)** | **[126](#sub_004)** |
| **[LEGAL MATTERS](#sub_005)** | **[128](#sub_005)** |
| **[WHERE YOU CAN FIND ADDITIONAL INFORMATION](#sub_006)** | **[128](#sub_006)** |
| **[INDEX TO FINANCIAL STATEMENTS OF MERCER SAVINGS BANK](#sub_007)** | **[F-1](#sub_007)** |

---

i

**SUMMARY**

*The following summary provides material information about Mercer Savings Bank's mutual-to-stock conversion and the related stock offering of Mercer Bancorp common stock. It may not contain all of the information that is important to you. For additional information before making an investment decision, you should read this entire document carefully, including the financial statements and the notes to the financial statements, as well as the section entitled "Risk Factors."*

**Mercer Bancorp, Inc.**

Mercer Bancorp, a newly formed Maryland corporation, is offering for sale shares of its common stock in connection with the conversion of Mercer Savings Bank from a mutual bank (meaning it has no stockholders) to a stock bank. All depositors and borrowers are members of and have voting rights in Mercer Savings Bank as to all matters requiring membership action. The following diagram depicts Mercer Savings Bank's current organizational structure:

![](tm238570d1_s1-img03.jpg)

Upon completion of the conversion and stock offering, Mercer Bancorp will be 100% owned by its stockholders and Mercer Savings Bank will be 100% owned by Mercer Bancorp. Mercer Savings Bank will cease to have members and former members will no longer have voting rights in Mercer Savings Bank. All voting rights in Mercer Savings Bank will be vested in Mercer Bancorp as the sole stockholder of Mercer Savings Bank. The stockholders of Mercer Bancorp will possess exclusive voting rights with respect to Mercer Bancorp common stock. The following diagram depicts Mercer Bancorp's and Mercer Savings Bank's organizational structure after the completion of the conversion and stock offering:

![](tm238570d1_s1-img04.jpg)

Mercer Bancorp was incorporated on March 7, 2023, and has not engaged in any business to date. Upon completion of the conversion and stock offering, Mercer Bancorp will register as a bank holding company and will be subject to comprehensive regulation and examination by the Board of Governors of the Federal Reserve System, referred to as the "Federal Reserve Board" throughout this prospectus.

Mercer Bancorp's principal office is located at 1100 Irmscher Blvd, Celina, Ohio 45822, and its telephone number at that address is (419) 586-5158.

**Mercer Savings Bank**

Originally chartered in 1888, Mercer Savings Bank is an Ohio-chartered mutual bank headquartered in Celina, Ohio. We consider our primary market area for loan originations and deposit gathering to be Mercer and Darke Counties in western Ohio and contiguous areas, including Adams and Jay Counties in eastern Indiana. We conduct our operations from our main office in Celina, Ohio and three branch offices in Celina, Fort Recovery and Greenville, Ohio. We also intend to establish a fifth branch office during 2024 in Adams or Jay County in eastern Indiana, where we are an active lender. In addition to our branch network, we offer online and mobile banking.

Our business consists primarily of taking deposits from the general public and investing those deposits, together with funds generated from operations and borrowings, in one- to four-family residential mortgage loans and agricultural real estate loans secured by properties located in our primary market area. To a lesser extent, we also originate multifamily real estate loans, commercial real estate loans, construction and land loans, home equity lines of credit, commercial and industrial loans, and consumer loans, and purchase investment securities. Following the conversion and stock offering, we intend to continue to seek to expand our residential real estate and agricultural real estate portfolios. Additionally, in January 2023, we began implementing an indirect automobile lending program. Our management team has experience with indirect automobile lending and we intend to prudently grow that segment of our loan portfolio. We offer a variety of deposit accounts including checking accounts, savings accounts and certificates of deposit. Our primary source of funding is core deposits. We also utilize advances from the Federal Home Loan Bank of Cincinnati and brokered deposits for liquidity and asset/liability management purposes, and may attempt to attract municipal deposits to a lesser extent.

In February 2022, we hired our current President and Chief Executive Officer, Barry Parmiter, who has 25 years of experience in community bank leadership in Ohio. Since that time, our board of directors and management have conducted an extensive review of our business strategy, operations, and our information technology systems and other third-party service providers. In July 2022, consistent with our strategy to implement an indirect automobile lending program, we hired a Senior Vice President of Indirect Lending, Ryan Moorman. We are also seeking to hire up to three additional lending and underwriting staff.

At December 31, 2022, we had total assets of $146.2 million, total deposits of $127.7 million and total equity capital of $14.5 million. We had net income of $329,000 for the three months ended December 31, 2022, and net income of $944,000 for the year ended September 30, 2022. Our primary revenue source is interest income earned on loans and investments. Noninterest income is not a significant revenue source.

We are subject to comprehensive regulation and examination by the ODFI, our chartering authority, and the FDIC, our primary federal regulator.

Our main office is located at 1100 Irmscher Blvd, Celina, Ohio 45822, and our telephone number at that address is (419) 586-5158. Our website address is *www.mercersavings.com*. Information on our website is not incorporated into this prospectus and should not be considered part of this prospectus.

**Business Strategy**

Our principal objective is to build long-term value for our stockholders by operating a profitable community financial institution dedicated to meeting the banking needs of our customers and community. Highlights of our current business strategy include:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· continuing to focus on originating one- to four-family residential mortgage loans and agricultural real estate loans for retention
in our loan portfolio;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· growing and diversifying our loan portfolio prudently by implementing an indirect automobile lending program and enhancing fee income
through the pooling and sale of such loans;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· maintaining our strong asset quality through conservative loan underwriting;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· continuing efforts to gain deposit market share and grow our low-cost "core" deposit base; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· expanding our market area and access to customers through organic growth and de novo branching, while also considering opportunistic
acquisitions. We intend to establish a fifth branch office in 2024 in Adams or Jay County in eastern Indiana, where we are an active lender.

Indirect automobile loans have a different risk profile than one- to four-family residential mortgages and other types of loans. See "Risk Factors – Risks Related to Our Lending Activities – Our new indirect automobile lending program involves risks that could adversely affect our financial condition and results of operations" and "Business of Mercer Savings Bank – Loan Underwriting Risks."

We expect the strategies outlined above to guide our investment of the net proceeds of the stock offering. We intend to continue to pursue these business strategies after the conversion and the stock offering, subject to any changes necessitated by future market conditions and other factors. See "Business of Mercer Savings Bank" and "Management's Discussion and Analysis of Financial Condition and Results of Operations – Business Strategy" for a further discussion of our business strategy.

**Reasons for the Conversion and Stock Offering**

Consistent with our business strategy, our primary reasons for converting to stock form and raising additional capital through the stock offering are:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· to increase capital to support future growth and profitability;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· to retain and attract qualified personnel by establishing stock-based benefit plans for management and employees;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· to offer our customers and employees an opportunity to purchase an equity interest in Mercer Savings Bank by purchasing shares of
common stock of Mercer Bancorp; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· to support and enhance Mercer Savings Bank's charitable giving in its local community.

At December 31, 2022, Mercer Savings Bank was considered "well capitalized" for regulatory purposes. The proceeds from the stock offering will further improve our capital position to support expected future growth and profitability.

See "The Conversion and Stock Offering" for a more complete discussion of our reasons for conducting the conversion and stock offering.

**Terms of the Stock Offering**

Mercer Bancorp is offering for sale between 1,105,000 shares and 1,495,000 shares of common stock to eligible depositors and borrowers of Mercer Savings Bank and to Mercer Savings Bank's tax-qualified employee benefit plans in a subscription offering. To the extent shares remain available, we may offer shares for sale in a community offering, with a preference given to natural persons (and trusts of natural persons) residing in Mercer and Darke Counties in Ohio and Adams and Jay Counties in Indiana. We may also offer for sale shares of common stock not purchased in the subscription offering or in any community offering to the general public in a syndicated community offering. The number of shares of common stock to be sold may be increased to up to 1,719,250 shares as a result of demand for the shares of common stock in the stock offering or changes in market conditions. Unless the number of shares of common stock offered for sale is increased to more than 1,719,250 shares or decreased to fewer than 1,105,000 shares, or the stock offering is extended beyond [extended expiration date], subscribers will not have the opportunity to change or cancel their stock orders once submitted. If the stock offering is extended past [extended expiration date], we will resolicit subscribers and you will have the opportunity to confirm, change or cancel your order within a specified period of time. If you do not respond during that period of time, your stock order will be cancelled and your deposit account withdrawal authorizations will be cancelled or your funds submitted will be returned promptly with interest at 0.05% per annum. If the number of shares offered for sale is increased to more than 1,719,250 shares or decreased to fewer than 1,105,000 shares, all subscribers' stock orders will be cancelled, their deposit account withdrawal authorizations will be cancelled and funds delivered for the purchase of shares of common stock in the stock offering will be returned promptly with interest at 0.05% per annum. We will give these subscribers an opportunity to place new orders for a specified period of time.

The shares of common stock are being offered for sale at a purchase price of $10.00 per share. All investors will pay the same purchase price per share. Investors will not be charged a commission to purchase shares of common stock in the stock offering. Performance Trust, our marketing agent for the stock offering, will use its best efforts to assist us in selling shares of our common stock but is not obligated to purchase any shares of common stock in the stock offering.

**Important Risks of Owning Mercer Bancorp's Common Stock**

Before you order shares of our common stock, you should read the "Risk Factors" section beginning on page 13 of this prospectus.

**How We Determined the Offering Range and the $10.00 per Share Purchase Price**

The amount of common stock Mercer Bancorp is offering for sale is based on an independent appraisal of the estimated pro forma market value of Mercer Bancorp, assuming the conversion and stock offering are completed. FinPro Capital Advisors, Inc., referred to as "FinPro" throughout this prospectus, our independent appraiser, has estimated that, as of February 28, 2023, the estimated pro forma market value of Mercer Bancorp was $13.5 million (including the value of the 50,000 shares of common stock to be contributed to the charitable foundation established in connection with the conversion, valued at $10.00 per share). Based on federal regulations, this market value forms the midpoint of a valuation range with a minimum of $11.6 million and a maximum of $15.5 million (including the value of the 50,000 shares contributed to the charitable foundation). Based on this valuation and the $10.00 per share purchase price, and excluding the 50,000 shares to be contributed to the charitable foundation, the number of shares of common stock being offered for sale in the stock offering ranges from a minimum of 1,105,000 shares to a maximum of 1,495,000 shares. We may sell up to 1,719,250 shares of common stock because of demand for the shares or changes in market conditions without resoliciting subscribers. The $10.00 per share purchase price was selected primarily because it is the price most commonly used in mutual-to-stock conversions of financial institutions.

The appraisal is based in part on Mercer Savings Bank's financial condition and results of operations, the pro forma effect of the additional capital raised by the sale of shares of common stock in the stock offering and an analysis of a peer group of twelve publicly traded bank and savings and loan holding companies with assets of between $265.0 million and $2.1 billion as of the most recent reported data most recently available last twelve months (September 30, 2022 or December 31, 2022) that FinPro considers comparable to Mercer Bancorp under regulatory guidelines applicable to the independent valuation. See "The Conversion and Stock Offering – Determination of Share Price and Number of Shares to be Issued."

The following table presents a summary of selected pricing ratios for the peer group companies and for Mercer Bancorp (on a pro forma basis) that FinPro utilized in its appraisal. See "The Conversion and Stock Offering – Determination of Share Price and Number of Shares to be Issued" for information regarding the peer group companies. These ratios are based on Mercer Bancorp's book value, tangible book value and core earnings as of and for the three months ended December 31, 2022, annualized. The peer group ratios are based on the latest date for which complete financial data are publicly available and stock prices as of February 17, 2023. Compared to the average pricing of the peer group, our pro forma pricing ratios at the midpoint of the offering range indicate a discount of 55.1% on a core earnings value basis, 41.1% on a price-to-book value basis and a discount of 42.1% on a price-to-tangible book value basis.

---

| | | | |
|:---|:---|:---|:---|
|  | **Price-to-core earnings multiple <sup>(1)</sup>** | **Price-to-book value ratio** | **Price-to-tangible book value ratio** |
| **Mercer Bancorp (pro forma basis, assuming completion of the conversion and stock offering):** |  |  |  |
| &nbsp;&nbsp;&nbsp;Adjusted Maximum | 10.75 x | 63.49% | 63.49% |
| &nbsp;&nbsp;&nbsp;Maximum | 9.62 x | 59.67% | 59.67% |
| &nbsp;&nbsp;&nbsp;Midpoint | 8.62 x | 55.83% | 55.83% |
| &nbsp;&nbsp;&nbsp;Minimum | 7.58 x | 51.41% | 51.41% |
| **Valuation of peer group companies, all of which are fully converted (historical basis):** |  |  |  |
| &nbsp;&nbsp;&nbsp;Average | 33.40 x | 94.40% | 97.40% |
| &nbsp;&nbsp;&nbsp;Median | 19.20 x | 94.80% | 96.40% |

---

(1) Price-to-earnings multiples calculated by FinPro are based on an estimate of "core" or recurring earnings. These ratios
are different from those presented in "Pro Forma Data."

**The independent appraisal does not indicate trading market value. Do not assume or expect that our valuation as indicated in the appraisal means that after the conversion and stock offering the shares of our common stock will trade at or above the $10.00 per share purchase price. Furthermore, FinPro used the pricing ratios presented in the appraisal to estimate our pro forma appraised value for regulatory purposes and not to compare the relative value of shares of our common stock with the value of the common stock of the institutions in the peer group. The value of the common stock of any company may be affected by a number of factors such as financial performance, asset size and market location.**

For a more complete discussion of the amount of common stock we are offering for sale and the independent appraisal, see "The Conversion and Stock Offering – Determination of Share Price and Number of Shares to be Issued."

**How We Intend to Use the Proceeds from the Stock Offering**

Mercer Savings Bank will receive from Mercer Bancorp a capital contribution equal to at least 50% of the net proceeds of the stock offering. Based on this formula, we anticipate that Mercer Bancorp will invest, at the minimum, midpoint, maximum and adjusted maximum of the offering range, approximately $4.7 million, $5.6 million, $6.6 million and $7.7 million, respectively, of the net proceeds from the stock offering in Mercer Savings Bank. From the remaining funds, Mercer Bancorp intends to loan funds to Mercer Savings Bank's employee stock ownership plan to fund the plan's purchase of shares of common stock in the stock offering, contribute $100,000 in cash to the charitable foundation and retain the remainder of the net proceeds from the stock offering. Assuming we sell 1,300,000 shares of common stock in the stock offering at the midpoint of the offering range, resulting in net proceeds after expenses of $11.3 million, based on the above formula, we anticipate that Mercer Bancorp will invest $5.6 million in Mercer Savings Bank, loan $1.1 million to Mercer Savings Bank's employee stock ownership plan to fund its purchase of shares of common stock, contribute $100,000 to the charitable foundation and retain the remaining $4.4 million of net proceeds.

Mercer Bancorp may use the funds that it retains to repurchase shares of common stock (subject to compliance with regulatory requirements), to pay cash dividends (if declared by our board of directors), for investments, or for other general corporate purposes. Mercer Savings Bank intends to invest the net proceeds it receives from Mercer Bancorp to fund new loans, enhance existing products and services, and expand its banking franchise by establishing new branches or acquiring other financial institutions or branches thereof, as opportunities arise. We currently intend to establish a fifth branch office during 2024. We do not currently have any understandings or agreements regarding any acquisitions.

For more information, see "How We Intend to Use the Proceeds from the Stock Offering."

**Persons Who May Order Shares of Common Stock in the Stock Offering**

We are offering the shares of common stock in a subscription offering in the following order of priority:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) First, to depositors with accounts at Mercer Savings Bank with aggregate balances of at least $50 as of the close of business on February 28,
2022. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Second, to Mercer Savings Bank's tax-qualified employee benefit plans (including its employee stock ownership plan), which will
receive, without payment, nontransferable subscription rights to purchase in the aggregate up to 10% of the shares of common stock sold
in the stock offering and contributed to the charitable foundation. We expect the employee stock ownership plan to purchase up to 8% of
the shares of common stock sold in the stock offering and contributed to the charitable foundation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Third, to depositors and borrowers of Mercer Savings Bank as of the close of business on [voting record date].

Shares of common stock not purchased in the subscription offering may be offered for sale in a community offering, with a preference given to natural persons (and trusts of natural persons) residing in Mercer and Darke Counties in Ohio and Adams and Jay Counties in Indiana. If held, the community offering may begin concurrently with, during or after the subscription offering. We also may offer for sale shares of common stock not purchased in the subscription offering or in any community offering to the general public through a syndicated community offering, which will be managed by Performance Trust. We have the right to accept or reject, in our sole discretion, orders received in any community offering or syndicated community offering. Any determination to accept or reject stock orders in any community offering or syndicated community offering will be based on the facts and circumstances available to management at the time of the determination.

If we receive orders for more shares than we are offering for sale, we may not be able to fill your order, in full or in part. Shares will be allocated first to categories in the subscription offering. A detailed description of the subscription offering, the community offering and the syndicated community offering, as well as a discussion regarding allocation procedures, can be found in the section of this prospectus entitled "The Conversion and Stock Offering."

**Limits on How Much Common Stock You May Purchase**

The minimum number of shares of common stock that may be purchased is 25.

Generally, no individual, or individuals acting through a single qualifying account held jointly, may purchase more than the greater of: (i) 20,000 shares ($200,000) of common stock; (ii) 0.10% of the total number of shares of common stock issued in the stock offering; or (iii) 15 times the number of shares offered multiplied by a fraction of which the numerator is the depositor's total deposit balance as of the eligibility record date and the denominator is the aggregate of all deposits as of the eligibility record date, subject to the overall purchase limitations. If any of the following persons purchase shares of common stock, their purchases, in all categories of the stock offering combined, when combined with your purchases, cannot exceed 40,000 shares ($400,000) of common stock:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· your spouse, or relatives of you or your spouse, who reside with you;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· most companies, trusts or other entities in which you are a trustee, have a substantial beneficial interest or hold a senior position;
or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· other persons who may be your associates or who may be acting in concert with you.

Unless we determine otherwise, persons having the same address and persons exercising subscription rights through qualifying accounts registered to the same address at either the February 28, 2022 eligibility record date or [voting record date] will be subject to the overall purchase limitation of 40,000 shares ($400,000). See the detailed definitions of "associate" and "acting in concert" in the section of this prospectus entitled "The Conversion and Stock Offering – Limitations on Common Stock Purchases."

Federal regulations provide that such purchase limitation may be further increased to 9.99%, provided that orders for shares of common stock exceeding 5% of the shares of common stock sold in the stock offering do not exceed in the aggregate 10% of the total shares of the common stock sold in the stock offering. Any such requests to purchase additional shares of common stock in the event that a purchase limitation is so increased will be determined by our board of directors in its sole discretion.

Subject to any required regulatory approval, we may increase or decrease the purchase limitations at any time. See the detailed description of the purchase limitations in the section of this prospectus entitled "The Conversion and Stock Offering – Limitations on Common Stock Purchases."

**How You May Purchase Shares of Common Stock in the Subscription Offering and in any Community Offering**

In the subscription offering, and in any community offering, you may pay for your shares only by:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· personal check, bank check or money order made payable to Mercer Bancorp, Inc.;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· authorizing us to withdraw available funds (without any early withdrawal penalty) from your account(s) maintained with Mercer
Savings Bank, other than individual retirement accounts (IRAs); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· cash.

You may not use any type of third-party check to pay for shares of common stock. Wire transfers will not be accepted. Applicable regulations prohibit Mercer Savings Bank from lending funds or extending credit to any person to purchase shares of common stock in the stock offering. You may not submit a Mercer Savings Bank line of credit check. You may not designate withdrawal from Mercer Savings Bank's accounts with check-writing privileges; rather, submit a check. If you request a withdrawal from an account with check-writing privileges, we reserve the right to interpret that as your authorization to treat those funds as if we had received a check for the designated amount, and will immediately withdraw the amount from your checking account(s). You may not authorize direct withdrawal from a Mercer Savings Bank IRA. See "—Using Individual Retirement Account Funds to Purchase Shares of Common Stock."

You may subscribe for shares of common stock in the subscription and community offerings by delivering a signed and completed original stock order form, together with full payment payable to Mercer Bancorp, Inc. or authorization to withdraw funds from one or more of your Mercer Savings Bank deposit accounts, provided that the stock order form is *received* (not postmarked) before 5:00 p.m., Eastern time, on [expiration date], which is the expiration of the subscription offering period. You may submit your stock order form and payment by mail using the stock order reply envelope provided or by overnight delivery to the address listed on the stock order form. You may hand-deliver stock order forms to our office located at 1100 Irmscher Blvd, Celina, Ohio. Our office is open on Monday, Tuesday, Wednesday and Friday from 9:00 a.m. to 5:00 p.m., Eastern time, excluding bank holidays, and on Thursday and Saturday from 9:00 a.m. to 12:00 p.m., Eastern time, excluding bank holidays. Hand-delivered stock order forms will be accepted only at this location.

For a complete description of how to purchase shares in the stock offering, see "The Conversion and Stock Offering – Procedure for Purchasing Shares in the Subscription Offering and any Community Offering."

**Using Individual Retirement Account Funds to Purchase Shares of Common Stock**

You may be able to subscribe for shares of common stock using funds in your IRA or other retirement account. If you wish to use some or all of the funds in your Mercer Savings Bank IRA or other retirement account, the applicable funds must be first transferred to a self-directed account maintained by an independent custodian or trustee, such as a brokerage firm, and the purchase must be made through that account. If you do not have such an account, you will need to establish one <u>before</u> placing your stock order. An annual administrative fee may be payable to the independent custodian or trustee. Because individual circumstances differ and the processing of retirement fund orders takes additional time, we recommend that you contact our Stock Information Center as soon as possible, <u>but in no event less than two weeks before the [expiration date] offering deadline</u>, for assistance with purchases using funds held in retirement accounts. Whether you may use such funds to purchase shares in the stock offering may depend on timing constraints and, possibly, limitations imposed by the institution where the funds are held.

For a complete description of how to use IRA funds to purchase shares in the stock offering, see "The Conversion and Stock Offering – Procedure for Purchasing Shares in the Subscription Offering and any Community Offering – Using Individual Retirement Account Funds."

**Purchases by Executive Officers and Directors**

We expect our directors and executive officers, together with their associates, to subscribe for 65,500 shares ($655,000) of common stock in the stock offering, representing 5.7% of shares to be issued at the minimum of the offering range (including shares contributed to the charitable foundation). However, there can be no assurance that any individual director or executive officer, or the directors and executive officers as a group, will purchase any specific number of shares of our common stock. They will pay the same $10.00 per share purchase price that all other persons who purchase shares of common stock in the stock offering will pay. Our directors and executive officers are subject to the same minimum purchase requirements and purchase limitations as other participants in the stock offering as set forth under "– Limits on How Much Common Stock You May Purchase."

Purchases by our directors and executive officers and their associates will be included in determining whether the required minimum number of shares have been subscribed for in the stock offering.

For more information, see "Subscriptions by Directors and Executive Officers."

**Deadline for Submitting Orders for Shares of Common Stock in the Subscription Offering and any Community Offering**

The deadline for submitting orders to purchase shares of common stock in the subscription offering and in any community offering is 5:00 p.m., Eastern time, on [expiration date], unless we extend this deadline. If you wish to purchase shares of common stock, a properly completed and signed original stock order form, together with full payment, must be received (not postmarked) by 5:00 p.m., Eastern time. Although we will make reasonable attempts to provide this prospectus and offering materials to holders of subscription rights, the subscription offering and all subscription rights will expire at 5:00 p.m., Eastern time, on [expiration date], whether or not we have been able to locate each person entitled to subscription rights.

See "The Conversion and Stock Offering—Procedure for Purchasing Shares in the Subscription Offering and any Community Offering—Expiration Date" for a complete description of the deadline for purchasing shares in the stock offering.

**You May Not Sell or Transfer Your Subscription Rights**

Applicable regulations prohibit you from transferring your subscription rights. If you order shares of common stock in the subscription offering, you will be required to certify that you are purchasing the common stock for yourself and that you have no agreement or understanding to sell or transfer your subscription rights or the shares that you are purchasing. We intend to take legal action, including reporting persons to federal or state agencies, against anyone who we believe has sold or transferred their subscription rights. We will not accept your order if we have reason to believe you have sold or transferred or are attempting to sell or transfer your subscription rights to any other person. **On the stock order form, you cannot add the names of others for joint stock registration unless they are also named on the qualifying deposit or loan account.** Taking this action may jeopardize your subscription rights. In addition, the stock order form requires that you list all deposit accounts, giving all names on each account and the account number at the applicable eligibility date. Failure to provide this information, or providing incomplete or incorrect information, may result in a loss of part or all of your share allocation.

**Steps We May Take if We Do Not Receive Orders for the Minimum Number of Shares**

If we do not receive orders for at least 1,105,000 shares of common stock, we may take additional steps in order to issue the minimum number of shares of common stock in the offering range. Specifically, we may:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· increase the purchase limitations; and/or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· extend the stock offering.

If we extend the stock offering beyond [extended expiration date], we will resolicit subscribers and you will have the opportunity to confirm, change or cancel your order within a specified period of time. If you do not respond during that period of time, your stock order will be cancelled and your deposit account withdrawal authorizations will be cancelled or your funds submitted will be returned promptly with interest at 0.05% per annum from the date the stock order was processed.

If one or more purchase limitations are increased we will not resolicit all subscribers, however, subscribers in the subscription offering who ordered the maximum amount and who indicated a desire to be resolicited on the stock order form will be and, in our sole discretion, some other large subscribers may be, given the opportunity to increase their subscriptions up to the newly applicable purchase limit. We may increase the individual or aggregate purchase limitations to an amount generally not to exceed 5% of the common stock sold in the stock offering. See "The Conversion and Stock Offering – Limitations on Common Stock Purchases."

**Conditions to Completion of the Conversion and Stock Offering**

We cannot complete the conversion and stock offering unless:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· The plan of conversion is approved by two-thirds of the votes eligible to be cast by members of Mercer Savings Bank. A special meeting
of members to consider and vote upon the plan of conversion has been scheduled for [special meeting date];

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· We sell at least 1,105,000 shares, which is the minimum of the offering range; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· We receive the final approvals required from the ODFI and the FDIC to complete the conversion and stock offering and from the Federal
Reserve Board with respect to Mercer Bancorp's holding company application.

Any approval by the ODFI, the FDIC or the Federal Reserve Board does not constitute a recommendation or endorsement of the plan of conversion.

**Our Dividend Policy**

Following completion of the stock offering, our board of directors will be authorized to declare dividends on our common stock, subject to statutory and regulatory requirements. However, no decision has been made with respect to the amount, if any, and timing of any dividend payments. The payment and amount of any dividend payments will depend upon a number of factors, including the following: regulatory capital requirements; our financial condition and results of operations; our other uses of funds for the long-term value of stockholders; tax considerations; statutory and regulatory limitations; and general economic conditions. See "Our Dividend Policy" for additional information.

**Market for Common Stock**

We currently anticipate that the common stock sold in the stock offering will be quoted on the OTCQB Market operated by OTC Markets Group upon the completion of the conversion and stock offering. However, following completion of the conversion, if we meet Nasdaq listing requirements, we will use our best efforts to obtain approval for our shares of common stock to trade on the Nasdaq Stock Market. See "Market for the Common Stock."

**Delivery of Shares of Stock**

All shares of common stock of Mercer Bancorp sold in the stock offering will be issued in book entry form and held electronically on the books of our transfer agent. Stock certificates will not be issued. A statement reflecting ownership of shares of common stock sold in the stock offering will be mailed by our transfer agent to the persons entitled thereto at the address noted by them on their stock order form as soon as practicable following consummation of the stock offering. Shares of common stock sold in any syndicated community offering may be delivered electronically through The Depository Trust Company. We expect trading in the stock to begin on the business day of or on the business day immediately following the completion of the conversion and stock offering. **Until a statement reflecting ownership of shares of common stock is available and delivered to purchasers, it is possible that purchasers may not be able to sell the shares of common stock that they ordered, even though the common stock will have begun trading.** Your ability to sell the shares of common stock before receiving your statement will depend on arrangements you may make with a brokerage firm.

**Possible Change in the Offering Range**

FinPro will update its appraisal before we complete the stock offering. If, as a result of demand for the shares or changes in market conditions, FinPro determines that our pro forma market value has increased, we may sell up to 1,719,250 shares in the stock offering without further notice to you. If our pro forma market value at that time is either below $11.6 million or above $17.7 million (including the value of shares to be contributed to the charitable foundation), then, after consulting with the ODFI and the FDIC, we may:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· terminate the stock offering, cancel deposit account withdrawal authorizations and promptly return all funds received in the stock
offering with interest at 0.05% per annum;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· set a new offering range; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· take such other actions as may be permitted by the ODFI, the FDIC, the Federal Reserve Board, the Financial Industry Regulatory Authority
and the Securities and Exchange Commission.

If we set a new offering range, we will promptly return funds, with interest at 0.05% per annum, received in the stock offering, cancel deposit account withdrawal authorizations and commence a resolicitation. In a resolicitation, we will notify subscribers of their right to place a new stock order for a specified period of time.

**Possible Termination of the Stock Offering**

We may terminate the stock offering at any time before the special meeting of members of Mercer Savings Bank that has been called to vote on the conversion, and at any time after member approval with the concurrence of the ODFI and the FDIC. If we terminate the stock offering, we will promptly return funds and cancel deposit withdrawal authorizations, as described above.

**Benefits to Management and Potential Dilution to Stockholders Resulting from the Conversion and Stock Offering**

We expect Mercer Savings Bank's employee stock ownership plan, which is a tax-qualified retirement plan for the benefit of all of our employees being established in connection with the conversion and stock offering, to purchase up to 8% of the shares of common stock that we sell in the stock offering and contribute to the charitable foundation. If we receive orders in the subscription offering for more shares of common stock than would permit the employee stock ownership plan's subscription order to be filled in whole in the subscription offering, then the employee stock ownership plan may, with prior regulatory approval, purchase shares to fill, in whole or in part, its order in the open market following completion of the conversion. For further information, see "Management – Executive Compensation – Employee Stock Ownership Plan."

Purchases by the employee stock ownership plan in the stock offering will be included in determining whether the required minimum number of shares have been sold in the stock offering. Subject to market conditions and receipt of regulatory approval, the employee stock ownership plan may instead elect to purchase shares of common stock in the open market following the completion of the stock offering in order to fill all or a portion of its intended subscription.

We also intend to implement a stock-based benefit plan no earlier than six months after completion of the conversion. Stockholder approval of this plan will be required, and the stock-based benefit plan cannot be implemented until at least six months after the completion of the conversion according to applicable federal regulations. If adopted within 12 months following the completion of the conversion, and provided that upon completion of the stock offering Mercer Savings Bank has at least a 10% tangible capital to assets ratio, the FDIC conversion regulations would allow for the stock-based benefit plan to reserve a number of shares of common stock equal to not more than 4% of the shares sold in the stock offering and contributed to the charitable foundation, or up to 61,800 shares of common stock at the maximum of the offering range, for restricted stock awards to key employees and directors, at no cost to the recipients. If adopted within 12 months following the completion of the conversion, the stock-based benefit plan will also reserve a number of shares equal to not more than 10% of the shares of common stock sold in the stock offering and contributed to the charitable foundation, or up to 154,500 shares of common stock at the maximum of the offering range, for the exercise of stock options granted to key employees and directors. If the stock-based benefit plan is adopted after one year from the date of the completion of the conversion, the 4% and 10% limitations described above will no longer apply, and we may adopt a stock-based benefit plan encompassing more than 216,300 shares of our common stock assuming the maximum of the offering range. We have not yet determined whether we will present this plan for stockholder approval within 12 months following the completion of the conversion or whether we will present this plan for stockholder approval more than 12 months after the completion of the conversion.

The following table summarizes the number of shares of common stock and aggregate dollar value of grants (valuing each share granted at the offering price of $10.00) that would be available under a stock-based benefit plan if such plan is adopted within one year following the completion of the conversion and stock offering and Mercer Savings Bank has at least a 10% tangible capital to assets ratio at that time. The table shows the dilution to stockholders if all these shares are issued from authorized but unissued shares, instead of shares purchased in the open market. The table also sets forth the number of shares of common stock to be acquired by the employee stock ownership plan for allocation to all employees. A portion of the stock grants shown in the table below may be made to non-management employees.

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Number of Shares to be Granted or Purchased <sup>(1)</sup>** | **Number of Shares to be Granted or Purchased <sup>(1)</sup>** | **Number of Shares to be Granted or Purchased <sup>(1)</sup>** | | **Value of Grants <sup>(2)</sup>** | **Value of Grants <sup>(2)</sup>** |
|  | **At <br> Minimum <br> of Offering <br> Range** | **At <br> Maximum <br> of Offering <br> Range** | **As a <br> Percentage <br> of Common <br> Stock to be <br> Issued** | **Dilution<br> Resulting**<br>**From <br> Issuance of <br> Shares for <br> Stock Benefit <br> Plans** | **At <br> Minimum <br> of Offering <br> Range** | **At <br> Maximum <br> of Offering <br> Range** |
|  | | | | | (dollars in thousands) | (dollars in thousands) |
| Employee stock ownership plan | 92400 | 123600 | 8.00% | n/a<sup>(3)</sup> | $924 | $1236 |
| Stock awards | 46200 | 61800 | 4.00 | 3.85% | 462 | 618 |
| Stock options | 115500 | 154500 | 10.00 | 9.09% | 430 | 575 |
| &nbsp;&nbsp;&nbsp;Total | 254100 | 339900 | 22.00% | 12.94% | $1816 | $1961 |

---

(1) The stock-based benefit plan may award a greater number of options and shares, respectively, if the plan is adopted more than 12 months
after the completion of the conversion.

(2) The actual value of restricted stock grants will be determined based on their fair value as of the date grants are made. For purposes
of this table, fair value is assumed to be the same as the offering price of $10.00 per share. The fair value of stock options has been
estimated at $3.72 per option using the Black-Scholes option pricing model with the following assumptions: a grant-date share price and
option exercise price of $10.00; dividend yield of 0%; an expected option life of 7.5 years; a risk-free interest rate of 4.1%; and a
volatility rate of 23.1%. The actual expense of stock options granted under a stock-based benefit plan will be determined by the grant-date
fair value of the options, which will depend on a number of factors, including the valuation assumptions used in the option pricing model
ultimately adopted, which may or may not be the Black-Scholes model.

(3) Represents the dilution of stock ownership interest. No dilution is reflected for the employee stock ownership plan because these
shares are assumed to be purchased in the stock offering.

**Income Tax Consequences**

Mercer Bancorp and Mercer Savings Bank have received an opinion from their counsel, Luse Gorman, PC, regarding the material federal income tax consequences of the conversion, including an opinion that it is more likely than not that the fair market value of the nontransferable subscription rights to purchase the common stock will be zero and, accordingly, no gain or loss will be recognized by depositors or borrowers of Mercer Savings Bank upon the distribution to them of the nontransferable subscription rights to purchase the common stock and no taxable income will be realized by them as a result of the exercise of the nontransferable subscription rights. Mercer Bancorp and Mercer Savings Bank have also received an opinion of S.R. Snodgrass, P.C., referred to as "Snodgrass" throughout this prospectus, tax advisors to Mercer Bancorp and Mercer Savings Bank, regarding the material Ohio state income tax consequences of the conversion. As a general matter, the conversion will not be a taxable transaction for purposes of federal or state income taxes to Mercer Bancorp, Mercer Savings Bank, or persons eligible to subscribe for shares of common stock in the subscription offering. For additional information, see "Taxation."

**Our Contribution of Cash and Shares of Common Stock to the Mercer Savings Charitable Foundation**

To further our commitment to our local community, we intend to establish and fund a new charitable foundation, the Mercer Savings Charitable Foundation, as part of the conversion and stock offering. Assuming we receive both regulatory approval and the approval of the members of Mercer Savings Bank, we intend to contribute to the new charitable foundation 50,000 shares of common stock and $100,000 in cash, for an aggregate contribution of $600,000 based on the $10.00 per share purchase price.

The charitable foundation will be dedicated exclusively to supporting charitable causes and community development activities in the communities in which we operate. The contribution of common stock and cash to the charitable foundation will:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· with respect to the contribution of shares of common stock, dilute the voting interests of purchasers of shares of our common stock
in the stock offering; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· result in an expense, and a reduction in capital, during the quarter in which the contribution is made, equal to the full amount of
the contribution to the charitable foundation, which we expect to be offset in part by a corresponding tax benefit. As a result of the
contribution, we expect to record an after-tax expense of approximately $474,000 during the quarter in which the conversion and stock
offering is completed.

The amount of common stock that we would offer for sale would be greater if the conversion and stock offering were to be completed without the establishment and funding of the charitable foundation. For a further discussion of the financial impact of the charitable foundation, including its effect on those who purchase shares in the stock offering, see "Risk Factors – Risks Related to the Charitable Foundation – The contribution to the charitable foundation will dilute your ownership interest and adversely affect net income in 2023," and "Risk Factors – Risks Related to the Charitable Foundation – Our contribution to the charitable foundation may not be tax deductible, which could reduce our profits."

**How You Can Obtain Additional Information – Stock Information Center**

Our banking personnel may not, by law, assist with investment-related questions about the stock offering. If you have questions regarding the conversion and stock offering, call our Stock Information Center at [information center number]. The Stock Information Center is accepting telephone calls Monday through Friday between 10:00 a.m. and 5:00 p.m., Eastern time, excluding bank holidays.

**RISK FACTORS**

**You should carefully consider the following risk factors, in addition to all other information in this prospectus, in evaluating an investment in the shares of common stock.**

**<u>Risks Related to Our Lending Activities</u>**

**We have a high concentration of loans secured by real estate in our market area. Adverse economic conditions, both generally and in our market area, could adversely affect our financial condition and results of operations.**

The significant majority of our loans are secured by properties located in our market area and, as a result, we have a greater risk of loan defaults and losses in the event of an economic downturn in our market area, as adverse economic conditions may have a negative effect on the ability of our borrowers to make timely payments of their loans. Local economic conditions may impact the ability of our borrowers to repay loans and the value of the collateral securing loans. A deterioration in economic conditions as a result of inflation, recessionary conditions or otherwise could have the following consequences, any of which could have a material adverse effect on our business, financial condition, liquidity and results of operations, and could more negatively affect us compared to a financial institution that operates with more geographic diversity:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· our operating expenses may increase;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· demand for our products and services may decline;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· collateral for loans, especially real estate, may decline in value, thereby reducing customers' future borrowing power,
and reducing the value of assets and collateral associated with existing loans;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· loan delinquencies, problem assets, foreclosures and loan losses may increase and we may be required to increase our allowance for
loan losses; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the net worth and liquidity of loan guarantors may decline, impairing their ability to honor commitments to us.

Moreover, a significant decline in general economic conditions caused by inflation, recession, acts of terrorism, civil unrest, an outbreak of hostilities or other international or domestic calamities, an epidemic or pandemic, unemployment or other factors beyond our control could further impact these local economic conditions and could further negatively affect the financial results of our banking operations. In addition, deflationary pressures, while possibly lowering our operating costs, could have a significant negative effect on our borrowers, especially our business borrowers, and the values of underlying collateral securing loans, which could negatively affect our financial performance.

**Our agricultural real estate loans involve credit risks that could adversely affect our financial condition and results of operations.**

At December 31, 2022, our agricultural real estate loans totaled $31.0 million, or 25.3% of our loan portfolio. We plan to continue to emphasize the origination of these loans, which generally expose us to a greater risk of nonpayment and loss than one- to four-family residential real estate loans, because repayment often depends on the successful operation of the underlying farm and income stream of the borrowers. Additionally, such loans typically involve larger balances to single borrowers or groups of related borrowers. A sudden or prolonged downturn in the economy or agricultural conditions could result in borrowers being unable to repay their loans, thus exposing us to increased credit risk. If we foreclose on an agricultural real estate loan, the marketing and liquidation period to convert the real estate asset to cash can be lengthy with substantial holding costs. In addition, deferred maintenance, repairs and market stigma can result in prospective buyers expecting sale price concessions to offset their real or perceived economic losses for the time it takes them to return the property to profitability. Depending on the individual circumstances, initial charge-offs and subsequent losses on agricultural real estate loans can be unpredictable and substantial.

**Our new indirect automobile lending program involves risks that could adversely affect our financial condition and results of operations.**

In January 2023, we began implementing an indirect automobile lending program and intend to prudently grow this segment of our loan portfolio. We expect to originate loans for the purchase of new or used automobiles from car dealerships located in western and southeastern Ohio and eastern Indiana. Generally, automobile loans have greater risk of loss or default than one- to four-family residential real estate loans. These loans will typically be secured by automobiles, which depreciate rapidly in value, and may have high loan-to-value ratios. We face the risk that any recovered collateral for a defaulted loan may not provide an adequate source of repayment of the outstanding loan balance. As a result, consumer loan collections are dependent on the borrower's continuing financial stability and thus are more likely to be adversely affected by job loss, divorce, illness or personal bankruptcy. Furthermore, the application of various federal and state laws, including bankruptcy and insolvency laws, may limit our ability to recover on such loans. Our consumer lending activities are also subject to numerous consumer protection laws and regulations, including fair lending laws. Because indirect automobile loan applications are originated by automobile dealerships, we assume the risk of unsatisfactory origination programs, including any noncompliance with federal, state and local laws, which may affect our business operations, financial condition and results of operations. We also rely on the dealerships to ensure that our security interest in the financed vehicles is perfected.

Because we have only recently implemented our indirect automobile lending program, this segment of our portfolio is unseasoned and without significant payment history. Additionally, there has not yet been a significant period of time over which we can assess the quality of loans referred by particular car dealerships and track individual dealership performance. As a result, it may be difficult to predict the future performance of this part of our loan portfolio. These loans may have delinquency or charge-off levels above our expectations, which could adversely affect our future performance.

**Our construction and land loans involve credit risks that could adversely affect our financial condition and results of operations.**

At December 31, 2022, construction and land loans totaled $4.2 million, or 3.5% of our loan portfolio. Construction lending involves additional risks when compared with permanent finance lending because funds are advanced upon the security of the project, which is of uncertain value before its completion. Because of the uncertainties inherent in estimating construction costs, as well as the market value of the completed project and the effects of governmental regulation of real property, it is relatively difficult to accurately evaluate the total funds required to complete a project and the related loan-to-value ratio. In addition, generally during the term of a construction loan, interest may be funded by the borrower or disbursed from an interest reserve set aside from the construction loan budget. These loans often involve the disbursement of substantial funds with repayment substantially dependent on the success of the ultimate project and the ability of the borrower to sell or lease the property or obtain permanent take-out financing, rather than the ability of the borrower or guarantor to repay principal and interest. If the appraised value of a completed project proves to be overstated, we may have inadequate security for the repayment of the loan upon completion of construction of the project and may incur a loss. Land loans have substantially similar risks to speculative construction loans.

**If our allowance for loan losses is not sufficient to cover actual loan losses, our earnings could decrease.**

As a lender, we are exposed to the risk that customers will be unable to repay their loans according to their terms and that any collateral securing the payment of their loans may not be sufficient to assure repayment. In determining the amount of our allowance for loan losses, we review our loans and our loss and delinquency experience, and we evaluate economic conditions. We make various assumptions and judgments about the collectability of our loan portfolio, including the creditworthiness of our borrowers and the value of the real estate and other assets serving as collateral for the repayment of many of our loans. If our assumptions or the results of our analyses are incorrect, our allowance for loan losses may not be sufficient to cover losses inherent in our loan portfolio, resulting in additions to our allowance. In addition, our emphasis on loan growth and on increasing our portfolios of commercial real estate and commercial business loans, as well as any future credit deterioration could require us to increase our allowance for loan losses in the future. Material additions to our allowance would materially decrease our net income.

A new credit loss accounting standard, the Current Expected Credit Loss standard ("CECL"), will become effective for Mercer Savings Bank on October 1, 2023. CECL requires financial institutions to determine periodic estimates of lifetime expected credit losses on loans and recognize the expected credit losses as allowances for credit losses. This will change the current method of providing allowances for loan losses that are incurred or probable, which may require us to increase our allowance for credit losses and will require us to greatly increase the types of data we need to collect and review to determine the appropriate level of the allowance for credit losses.

In addition, bank regulators periodically review our allowance for loan losses and, as a result of such reviews, we may be required to increase our provision for loan losses or recognize further loan charge-offs. Any increase in our allowance for loan losses or loan charge-offs may have a material adverse effect on our financial condition and results of operations.

**We are subject to environmental liability risk associated with lending activities or properties we own.**

A significant portion of our loan portfolio is secured by real estate, and we could become subject to environmental liabilities with respect to one or more of these properties, or with respect to properties that we own in operating our business. During the ordinary course of business, we may foreclose on and take title to properties securing defaulted loans and, in doing so, there is a risk that hazardous or toxic substances could be found on these properties. If hazardous conditions or toxic substances are found on these properties, we may be liable for remediation costs, as well as for personal injury and property damage, civil fines and criminal penalties regardless of when the hazardous conditions or toxic substances first affected any particular property. Environmental laws may require us to incur substantial expenses to address unknown liabilities and may materially reduce the affected property's value or limit our ability to use or sell the affected property. In addition, future laws or more stringent interpretations or enforcement policies with respect to existing laws may increase our exposure to environmental liability. The remediation costs and any other financial liabilities associated with an environmental hazard could have a material adverse effect on us.

**<u>Risks Related to Market Interest Rates</u>**

**Fluctuations in market interest rates could reduce our profits and asset values.**

Net interest income makes up the significant majority of our income and is based on the difference between the interest income that we earn on interest-earning assets, such as loans and securities, and the interest expense that we pay on interest-bearing liabilities, such as deposits and borrowings. Any fluctuations in market interest rates may materially affect our net interest income. Interest rates are highly sensitive to many factors that are beyond our control, including general economic conditions and policies of governmental and regulatory agencies, particularly the Federal Reserve Board. During 2022, in response to accelerated inflation, the Federal Reserve Board implemented monetary tightening policies, resulting in significantly increased interest rates. The Federal Reserve Board has signaled that further tightening may be necessary to control inflation.

A substantial portion of our loans are fixed-rate loans. As of December 31, 2022, we had $53.2 million in fixed-rate loans, representing 43.5% of our loan portfolio. We generally retain the loans that we originate in our portfolio, however, in recent years, we have attempted to sell conforming, fixed-rate residential mortgages with longer terms upon origination, with servicing rights retained, to help limit our interest rate risk exposure and generate fee income. Additionally, variable rates that we may earn on our other interest-earning assets or pay on our interest-bearing liabilities are generally fixed for an initial contractual period of time. Like many savings institutions, our interest-bearing liabilities generally have shorter contractual maturities than our interest-earning assets. This imbalance can create significant earnings volatility as market interest rates change over time. Generally, in a period of rising interest rates, the interest income we earn on our assets may not increase as rapidly as the interest we pay on our liabilities. Rising interest rates may also materially affect demand for our products and services, particularly residential mortgage loans, resulting in fewer loan originations and decreased refinancing activity, and increases in the levels of delinquencies and defaults on loans. Furthermore, an inverted interest rate yield curve, where short-term interest rates (which are usually the rates at which financial institutions borrow funds) are higher than long-term interest rates (which are usually the rates at which financial institutions lend funds for fixed-rate loans) can reduce a financial institution's net interest margin and create financial risk for financial institutions that originate longer-term, fixed rate mortgage loans. Higher market interest rates and increased competition for deposits may result in higher interest expense, as we may offer higher rates to attract or retain customer deposits. Increases in interest rates may also increase the amount of interest expense we must pay to creditors on short- and long-term debt. Generally, in a period of declining interest rates, the interest income we earn on our assets may decrease more rapidly than the interest we pay on our liabilities, as borrowers prepay and refinance mortgage loans, and mortgage-backed securities and callable investment securities are called, subjecting us to reinvestment risk as we are then required to reinvest those cash flows at lower, current interest rates.

Any substantial, unexpected, prolonged change in market interest rates could have a material adverse effect on our financial condition, liquidity and results of operations. Changes in the level of interest rates also may negatively affect the value of our assets, including the value of our available-for-sale investment securities, which generally decreases when market interest rates rise, and ultimately affect our earnings.

We monitor interest rate risk through the use of simulation models, including estimates of the amounts by which the fair value of our assets and liabilities (our economic value of equity or "EVE") and our net interest income would change in the event of a range of assumed changes in market interest rates. At December 31, 2022, in the event of an instantaneous 200 basis point increase in interest rates, we estimate that we would have experienced a 13.68% decrease in EVE and a 1.72% decrease in net interest income. At December 31, 2022, in the event of an instantaneous 200 basis point decrease in interest rates, we estimate that we would have experienced a 9.52% decrease in EVE and a 4.24% increase in net interest income. For further discussion of how changes in interest rates could impact us, see "Management's Discussion and Analysis of Financial Condition and Results of Operations—Management of Market Risk."

**<u>Risks Related to Laws and Regulations</u>**

**Changes in laws and regulations and the cost of regulatory compliance with new laws and regulations may adversely affect our operations and/or increase our costs of operations.**

Mercer Savings Bank is subject to extensive regulation, supervision and examination by the ODFI and the FDIC. Mercer Bancorp will be subject to extensive regulation, supervision and examination by the Federal Reserve Board. Such regulation and supervision govern the activities in which an institution and its holding company may engage and are intended primarily for the protection of the federal deposit insurance fund and the depositors of Mercer Savings Bank, rather than for our stockholders. Regulatory authorities have extensive discretion in their supervisory and enforcement activities, including the imposition of restrictions on our operations, the classification of our assets and determination of the adequacy of the level of our allowance for loan losses. These regulations, along with existing tax, accounting, securities, insurance and monetary laws, rules, standards, policies, and interpretations, control the methods by which financial institutions conduct business, implement strategic initiatives and tax compliance, and govern financial reporting and disclosures. Any change in such regulation and oversight, whether in the form of regulatory policy, regulations, legislation or supervisory action, may have a material impact on our operations. Further, changes in accounting standards can be both difficult to predict and involve judgment and discretion in their interpretation by us and our independent accounting firm. These changes could materially impact, potentially even retroactively, how we report our financial condition and results of operations.

**Non-compliance with the USA PATRIOT Act, Bank Secrecy Act, or other laws and regulations could result in fines or sanctions.**

The USA PATRIOT and Bank Secrecy Acts require financial institutions to develop programs to prevent financial institutions from being used for money laundering and terrorist activities. If such activities are suspected, financial institutions are obligated to file suspicious activity reports with the U.S. Treasury's Office of Financial Crimes Enforcement Network. These rules require financial institutions to establish procedures for identifying and verifying the identity of customers seeking to open new financial accounts. Failure to comply with these regulations could result in fines or sanctions, including restrictions on pursuing acquisitions or establishing new branches. We have not been subject to fines or other penalties, or suffered business or reputational harm, as a result of money laundering activities in the past. However, the policies and procedures we have adopted that are designed to assist in compliance with these laws and regulations may not be effective in preventing violations of these laws and regulations. Furthermore, these rules and regulations continue to evolve and expand.

**Monetary policies and regulations of the Federal Reserve Board could adversely affect our business, financial condition and results of operations.**

In addition to being affected by general economic conditions, our earnings and growth are affected by the policies of the Federal Reserve Board. An important function of the Federal Reserve Board is to regulate the money supply and credit conditions. Among the instruments used by the Federal Reserve Board to implement these objectives are open market purchases and sales of U.S. government securities, adjustments of the discount rate and changes in banks' reserve requirements against bank deposits. These instruments are used in varying combinations to influence overall economic growth and the distribution of credit, bank loans, investments and deposits. Their use also affects interest rates charged on loans or paid on deposits.

The monetary policies and regulations of the Federal Reserve Board have had a significant effect on the operating results of financial institutions in the past and are expected to continue to do so in the future. The effects of such policies upon our business, financial condition and results of operations cannot be predicted.

**We are an emerging growth company, and any decision on our part to comply only with certain reduced reporting and disclosure requirements applicable to emerging growth companies could make our common stock less attractive to investors.**

Mercer Bancorp qualifies as an "emerging growth company" under the JOBS Act. For as long as it continues to be an emerging growth company, it may choose to take advantage of exemptions from various reporting requirements applicable to public companies that are not available to emerging growth companies, including, but not limited to, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements, and exemptions from the requirements of holding a non-binding advisory vote on executive compensation. As an emerging growth company, Mercer Bancorp also will not be subject to Section 404(b) of the Sarbanes-Oxley Act of 2002, which would require that our independent auditors audit our internal control over financial reporting. In addition, as an emerging growth company, we have elected to take advantage of the extended transition periods for adopting new or revised financial accounting standards until the date they are required to be adopted by private companies (however, if any new or revised financial accounting standards would not apply to private companies, we would not be able to delay their adoption). Accordingly, our financial statements may not be comparable to those of public companies that adopt new or revised financial accounting standards as of an earlier date. Investors may find our common stock less attractive since we have chosen to rely on these exemptions. If some investors find our common stock less attractive as a result of any choices to reduce future disclosure, there may be a less active trading market for our common stock and the price of our common stock may be more volatile.

**We are also a smaller reporting company, and even if we no longer qualify as an emerging growth company, any decision on our part to comply only with certain reduced reporting and disclosure requirements applicable to smaller reporting companies could make our common stock less attractive to investors.**

In addition to qualifying as an emerging growth company, Mercer Bancorp qualifies as a "smaller reporting company" under the federal securities laws. For as long as it continues to be a smaller reporting company, it may choose to take advantage of exemptions from various reporting requirements applicable to public companies that are not available to companies that are not smaller reporting companies, including, but not limited to, reduced financial disclosure obligations and reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements. If some investors find our common stock less attractive as a result of any choices to reduce future disclosure, there may be a less active trading market for our common stock and the price of our common stock may be more volatile.

**<u>Risks Related to Economic Conditions</u>**

**Inflation may have an adverse impact on our business and on our customers.**

Inflation risk is the risk that the value of assets or income from investments will be worth less in the future as inflation decreases the value of money. Recently, there have been market indicators of a pronounced rise in inflation and the Federal Reserve Board has raised certain benchmark interest rates in an effort to combat inflation. The Federal Reserve Board has signaled that further increases may be necessary to control inflation. As inflation increases, the value of our investment securities, particularly those with longer maturities, would decrease, although this effect can be less pronounced for floating rate instruments. In addition, inflation increases the cost of goods and services we use in our business operations, which increases our noninterest expenses. Furthermore, our customers are also affected by inflation and the rising costs of goods and services used in their households and businesses, which could have a negative impact on their ability to repay their loans with us.

**<u>Risks Related to Competitive Matters</u>**

**Strong competition within our market area may limit our growth and profitability.**

Competition in the banking and financial services industry is intense. We compete with other community banks and savings institutions, commercial banks, mortgage brokerage firms, credit unions, finance companies, mutual funds, insurance companies, brokerage and investment banking firms and unregulated or less regulated non-banking entities. Many of these competitors are substantially larger than us and have substantially greater resources and higher lending limits than we have and offer certain services that we do not or cannot provide. In addition, some of our competitors offer loans with lower interest rates and/or more attractive terms than loans we offer. Competition also makes it increasingly difficult and costly to attract and retain qualified employees. We expect competition to increase in the future as a result of legislative, regulatory and technological changes and the continuing trend of consolidation in the financial services industry. Our profitability depends upon our continued ability to successfully compete for business and qualified employees in our market area. The greater resources and deposit and loan products offered by some of our competitors may limit our ability to increase our interest-earning assets. See "Business of Mercer Savings Bank—Competition."

**Our small size makes it more difficult for us to compete.**

Our small asset size makes it more difficult to compete with other financial institutions that are larger and can more easily afford to invest in the marketing and technologies needed to attract and retain customers. Because our principal source of income is the net interest income we earn on our loans and investments after deducting interest paid on deposits and other sources of funds, our ability to generate the revenues needed to cover our expenses and finance such investments is limited by the size of our loan and investment portfolios. Accordingly, we are not always able to offer new products and services as quickly as our competitors. Our lower earnings may also make it more difficult to offer competitive salaries and benefits. In addition, our smaller customer base may make it difficult to generate meaningful non-interest income from such activities as securities and insurance brokerage. Finally, as a smaller institution, we are disproportionately affected by the continually increasing costs of compliance with new banking and other regulations.

**<u>Risks Related to Strategic and Operational Matters</u>**

**We may be unable to successfully implement our growth strategies.**

Our current growth strategy is multi-faceted. While we intend to continue to focus on one- to four-family residential and agricultural real estate lending in our market area, long-term growth in these types of loans may be limited given that our market area is rural and has a limited population and economy. Additionally, in 2023, we began implementing an indirect automobile lending program and establishing a network of car dealerships to generate indirect automobile loans. We intend to grow this segment of the loan portfolio. We also intend to establish a de novo branch office in our market area during 2024. Any failure by us to effectively implement any one or more of these growth strategies could have negative effects, including a possible decline in the size or the quality of our loan portfolio or a decrease in profitability caused by an increase in operating expenses. If our senior management and lending staff are forced to spend a disproportionate amount of time on these projects, it may distract their attention from operating our business or pursuing other growth opportunities.

**We will rely on dividends from Mercer Savings Bank for most of our revenue.**

Mercer Bancorp is a separate and distinct legal entity from its subsidiary, Mercer Savings Bank. A substantial portion of our revenue will come from dividends from Mercer Savings Bank. Federal and state laws and regulations limit the amount of dividends that our bank subsidiary may pay to us. Also, our right to participate in a distribution of assets upon a bank subsidiary's liquidation or reorganization is subject to the prior claims of the subsidiary's depositors and creditors. In the event Mercer Savings Bank is unable to pay dividends to us, we may not be able to pay obligations, service debt, or repurchase or pay dividends on our common stock.

**We face significant operational risks because of our reliance on technology. Our information technology systems may be subject to failure, interruption or security breaches.**

Information technology systems are critical to our business. Our business requires us to collect, process, transmit and store significant amounts of confidential information regarding our customers, employees and our own business, operations, plans and business strategies. We use various technology systems to manage our customer relationships, general ledger, securities investments, deposits, and loans. Our computer systems, data management and internal processes, as well as those of third parties, are integral to our performance. Our operational risks include the risk of malfeasance by employees or persons outside our company, errors relating to transaction processing and technology, systems failures or interruptions, breaches of our internal control systems and compliance requirements, and business continuation and disaster recovery. There have been increasing efforts by third parties to breach data security at financial institutions. Such attacks include computer viruses, malicious or destructive code, phishing attacks, denial of service or information or other security breaches that could result in the unauthorized release, gathering, monitoring, misuse, loss or destruction of confidential, proprietary and other information, damages to systems, or other material disruptions to network access or business operations. Although we take protective measures and believe that we have not experienced any of the data breaches described above, the security of our computer systems, software, and networks may be vulnerable to breaches, unauthorized access, misuse, computer viruses, or other malicious code and cyber-attacks that could have an impact on information security. Because the techniques used to cause security breaches change frequently, we may be unable to proactively address these techniques or to implement adequate preventative measures.

If there is a breakdown in our internal control systems, improper operation of systems or improper employee actions, or a breach of our security systems, including if confidential or proprietary information were to be mishandled, misused or lost, we could suffer financial loss, loss of customers and damage to our reputation, and face regulatory action or civil litigation. Any of these events could have a material adverse effect on our financial condition and results of operations. Insurance coverage may not be available for such losses, or where available, such losses may exceed insurance limits.

In addition, we outsource a majority of our data processing requirements to third-party providers. Accordingly, our operations are exposed to risk that these vendors will not perform according to our contractual agreements with them, or we also could be adversely affected if such an agreement is not renewed by the third-party vendor or is renewed on terms less favorable to us. If our third-party providers encounter difficulties, or if we have difficulty communicating with those service providers, our ability to adequately process and account for transactions could be affected, and our business operations could be adversely affected, which could have a material adverse effect on our financial condition and results of operations. Threats to information security also exist in the processing of customer information through various other vendors and their personnel. To our knowledge, the services and programs provided to us by third parties have not experienced any material security breaches. However, the existence of cyber-attacks or security breaches at third parties with access to our data, such as vendors, may not be disclosed to us in a timely manner.

**We depend on our management team to implement our business strategy and execute successful operations and we could be harmed by the loss of their services.**

We depend on the services of the members of our senior management team who direct our strategy and operations. Our executive officers and lending personnel possess substantial expertise, extensive knowledge of our markets and key business relationships. Our loss of these persons, or our inability to hire and retain additional qualified personnel, could impact our ability to implement our business strategy and could have a material adverse effect on our results of operations and our ability to compete in our markets. See "Management."

**We are a community bank and our ability to maintain our reputation is critical to the success of our business. The failure to do so may materially adversely affect our performance.**

We are a community bank, and our reputation is one of the most valuable components of our business. A key factor in implementing our business strategy is our reputation for customer service and knowledge of local markets to expand our presence by capturing new business opportunities from existing and prospective customers in our market area and contiguous areas. Threats to our reputation can come from many sources, including adverse sentiment about financial institutions generally, concerns about environmental, social and governance matters, unethical practices, employee misconduct, failure to deliver minimum standards of service or quality, compliance deficiencies, cybersecurity incidents and questionable or fraudulent activities of our customers. Negative publicity regarding our business, employees, or customers, with or without merit, may result in the loss of customers and employees, costly litigation and increased governmental regulation, all of which could adversely affect our business and operating results.

**Our funding sources may prove insufficient to replace deposits at maturity and support our future growth.**

We must maintain sufficient funds to respond to the needs of depositors and borrowers. As a part of our liquidity management, we use a number of funding sources in addition to core deposit growth and repayments and maturities of loans and investments. As we continue to grow, we are likely to become more dependent on these sources, which may include Federal Home Loan Bank of Cincinnati advances, federal funds purchased and brokered certificates of deposit. Adverse operating results or changes in industry conditions could lead to difficulty or an inability to access these additional funding sources. Our financial flexibility will be severely constrained if we are unable to maintain our access to funding or if adequate financing is not available to accommodate future growth at acceptable interest rates. If we are required to rely more heavily on more expensive funding sources to support future growth, our revenues may not increase proportionately to cover our costs. In this case, our operating margins and profitability would be adversely affected.

**Public health emergencies, like the COVID-19 pandemic, could adversely affect our financial condition and results of operations.**

The COVID-19 pandemic caused significant economic dislocation in the United States. Although the domestic and global economies have begun to recover from the COVID-19 pandemic as many health and safety restrictions have been lifted and vaccine distribution has increased, certain adverse consequences of the pandemic may continue to impact the macroeconomic environment and persist for some time, including labor shortages and disruptions of global supply chains. Growth in economic activity and in demand for goods and services, coupled with labor shortages and supply chain disruptions, has also contributed to rising inflationary pressures.

As a result of a public health emergency, including the COVID-19 pandemic, and related adverse local and national consequences, and as a result of governmental, consumer and business responses to any outbreak, we may be subject to the following risks, any of which could have a material, adverse effect on our business, financial condition, liquidity, or results of operations: demand for our products and services may decline; if consumer and business activities are restricted, loan delinquencies, problem assets, and foreclosures may increase, resulting in increased charges and reduced income; collateral for loans, especially real estate, may decline in value, which could increase loan losses; our allowance for loan losses may have to be increased if borrowers experience financial difficulties; cyber security risks may be increased as the result of an increase in the number of employees working remotely; critical services provided by third-party vendors may become unavailable; government responses to the pandemic may affect our workforce, human capital resources and infrastructure; and the Company may experience staffing shortages and unanticipated unavailability or loss of key employees, harming our ability to execute our business strategy. Any one or a combination of the foregoing factors could negatively impact our business, financial condition, results of operations and prospects.

**<u>Risks Related to Accounting Matters</u>**

**Changes in management's estimates and assumptions may have a material impact on our consolidated financial statements and our financial condition or operating results.**

In preparing this prospectus, as well as periodic reports we will be required to file under the Securities Exchange Act of 1934, as amended, upon the completion of the conversion and stock offering, including Mercer Bancorp's consolidated financial statements, our management is and will be required under applicable rules and regulations to make estimates and assumptions as of a specified date. These estimates and assumptions are based on management's best estimates and experience as of that date and are subject to substantial risk and uncertainty. Materially different results may occur as circumstances change and additional information becomes known. Areas requiring significant estimates and assumptions by management include our evaluation of the adequacy of our allowance for loan losses, estimation of the fair value of financial instruments, the valuation of other real estate acquired in connection with foreclosure or in satisfaction of loans, valuation allowances associated with the realization of deferred tax assets, and determinations with respect to amounts owed for income taxes.

**Changes in accounting standards could affect reported earnings.**

The bodies responsible for establishing accounting standards, including the Financial Accounting Standards Board, the Securities and Exchange Commission and other regulatory bodies, periodically change the financial accounting and reporting guidance that governs the preparation of our financial statements. These changes can be hard to predict and can materially impact how we record and report our consolidated financial condition and results of operations. In some cases, we could be required to apply new or revised guidance retroactively.

**<u>Other Risks Related to Our Business</u>**

**Legal and regulatory proceedings and related matters could adversely affect us.**

We have been and may in the future become involved in legal and regulatory proceedings. We consider most of the proceedings to be in the normal course of our business or typical for the industry; however, it is inherently difficult to assess the outcome of these matters, and we may not prevail in any proceedings or litigation. There could be substantial costs and management diversion in such litigation and proceedings, and any adverse determination could have a materially adverse effect on our business, reputation, or our financial condition and results of our operations.

**<u>Risks Related to the Stock Offering</u>**

**The future price of our shares of common stock may be less than the $10.00 purchase price per share in the stock offering.**

If you purchase shares of common stock in the stock offering, you may not be able to sell them later at or above the $10.00 purchase price. In many cases, shares of common stock issued by newly converted savings institutions or mutual holding companies have traded below the initial offering price. The aggregate purchase price of the shares of common stock sold in the stock offering will be based on an independent appraisal. The independent appraisal is not intended, and should not be construed, as a recommendation of any kind as to the advisability of purchasing shares of common stock. The independent appraisal is based on certain estimates, assumptions and projections, all of which are subject to change from time to time. After the shares begin trading, the trading price of our common stock will be determined by the marketplace, and may be influenced by many factors, including prevailing interest rates, the overall performance of the economy, changes in federal tax laws, new regulations, investor perceptions of Mercer Bancorp and the outlook for the financial services industry in general. Price fluctuations in our common stock may be unrelated to our operating performance.

**There will be a limited trading market in our common stock, which could hinder your ability to sell our common stock and may lower the market price of the stock.**

We have never issued stock and, therefore, there is no current trading market for the shares of common stock. Upon completion of the conversion and stock offering, we expect our common stock will be quoted on the OTCQB Market operated by OTC Markets Group. However, following completion of the conversion, if we meet Nasdaq listing requirements, we will use our best efforts to obtain approval for our shares of common stock to trade on the Nasdaq Stock Market. We expect that our "public float," which is the total number of our outstanding shares of common stock less the number of shares held by our employee stock ownership plan, our directors and executive officers and the charitable foundation, and which is used as a measure of shares available for trading, will be limited. The development of an active trading market depends on the existence of willing buyers and sellers, which is not within our control or that of any market maker. The number of active buyers and sellers of the shares of common stock at any particular time may be limited. Under such circumstances, you could have difficulty selling your shares of common stock on short notice, and, therefore, you should not view the shares of common stock as a short-term investment. In addition, the limited trading market could also result in a wider spread between the "bid" and "ask" prices for the common stock, which could make it more difficult to sell a large number of shares at one time and could mean a sale of a large number of shares at one time could depress the market price.

**Our failure to effectively deploy the net proceeds may have an adverse effect on our financial performance.**

We intend to contribute between $4.7 million and $6.6 million of the net proceeds of the stock offering (or $7.7 million at the adjusted maximum of the offering range) to Mercer Savings Bank. We may use the remaining net proceeds to invest in short-term investments and for general corporate purposes, including repurchasing shares of our common stock and paying dividends. We also expect to use a portion of the net proceeds we retain to fund a loan to our employee stock ownership plan to purchase shares of common stock in the stock offering. Mercer Savings Bank may use the net proceeds it receives to fund new loans, expand its retail banking franchise by establishing or acquiring new branches or by acquiring other financial institutions or other financial services companies, or for other general corporate purposes. We currently intend to establish a new branch office during 2024. However, except for funding the loan to the employee stock ownership plan and making a cash contribution to the charitable foundation, we have not allocated specific amounts of the net proceeds for any of these purposes, and we will have broad discretion in determining the amount of the net proceeds we apply to different uses and when we apply or reinvest such proceeds. Also, certain of these uses, such as opening new branches or acquiring other financial institutions, may require the approval of our bank regulators. We have not established a timetable for investing the net proceeds, and we cannot predict how long we will require to invest the net proceeds. Our failure to reinvest these funds effectively would reduce our profitability and may adversely affect the value of our common stock.

**The cost of additional finance and accounting systems, procedures, compliance and controls in order to satisfy our new public company reporting requirements will increase our expenses.**

As a result of the completion of the conversion and stock offering, we will become a public reporting company. We expect that the obligations of being a public company, including the substantial public reporting obligations, will require significant expenditures and place additional demands on our management team. We have made, and will continue to make, changes to our internal controls and procedures for financial reporting and accounting systems to meet our reporting obligations as a stand-alone public company. However, the measures we take may not be sufficient to satisfy our obligations as a public company. The Sarbanes-Oxley Act of 2002 requires annual management assessments of the effectiveness of our internal control over financial reporting, starting with the second annual report that we would expect to file with the Securities and Exchange Commission. Any failure to achieve and maintain an effective internal control environment could have a material adverse effect on our business and stock price. In addition, we may need to hire additional compliance, accounting and financial staff with appropriate public company experience and technical knowledge, and we may not be able to do so in a timely fashion. As a result, we may need to rely on outside consultants to provide these services for us until qualified personnel are hired. These obligations will increase our operating expenses and could divert our management's attention from our operations.

**Our stock-based benefit plans will increase our expenses and reduce our income.**

We intend to adopt one or more new stock-based benefit plans after the conversion, subject to stockholder approval, which will increase our annual compensation and benefit expenses related to the stock options and stock awards granted to participants under the new stock-based benefit plans. The actual amount of these new stock-related compensation and benefit expenses will depend on the number of options and stock awards granted under the plans, the fair market value of our stock or options on the date of grant, the vesting period, and other factors which we cannot predict at this time. If we adopt stock-based benefit plans within 12 months following the conversion, the shares of common stock reserved for issuance pursuant to awards of restricted stock and grants of options under such plans would be limited to 4% and 10%, respectively, of the sum of shares of our common stock sold in the stock offering and contributed to the charitable foundation. If we adopt stock-based benefit plans more than 12 months after the completion of the conversion, we may adopt plans that allow for greater amounts of awards and options and, therefore, we could award restricted shares of common stock or grant options in excess of these amounts, which would further increase costs.

In addition, we will recognize expense for our employee stock ownership plan when shares are committed to be released to participants' accounts, and we will recognize expense for restricted stock awards and stock options over the vesting period of awards made to recipients. The expense in the first year following the conversion and stock offering for our employee stock ownership plan and for our new stock-based benefit plans, assuming such plans had been implemented at the beginning of the year, is estimated to be approximately $180,000 ($142,000 after tax) at the adjusted maximum of the offering range as set forth in the pro forma financial information under "Pro Forma Data," assuming the $10.00 per share purchase price as fair market value. Actual expenses, however, may be higher or lower, depending on the price of our common stock. For further discussion of our proposed stock-based plans, see "Management—Benefits to be Considered Following Completion of the Conversion and Stock Offering."

**The implementation of stock-based benefit plans may dilute your ownership interest. Historically, stockholders have approved these stock-based benefit plans.**

We intend to adopt one or more new stock-based benefit plans following the stock offering. These plans may be funded either through open market purchases of our common stock or from the issuance of authorized but unissued shares of common stock. Our ability to repurchase shares of our common stock to fund these plans will be subject to many factors, including applicable regulatory restrictions on stock repurchases, the availability of stock in the market, the trading price of our stock, our capital levels, alternative uses for our capital and our financial performance. Stockholders would experience a 9.09% dilution in ownership interest if newly issued shares of our common stock are used to fund stock options in an amount equal to 10% of the shares sold in the stock offering and contributed to the charitable foundation, and all such stock options are exercised, and a 3.85% dilution in ownership interest if newly issued shares of our common stock are used to fund shares of restricted common stock in an amount equal to 4% of the shares sold in the stock offering and contributed to the charitable foundation. Such dilution would also reduce earnings per share. If we adopt the plans more than 12 months following the conversion, new stock-based benefit plans would not be subject to these size limitations and stockholders could experience even greater dilution.

Although the implementation of new stock-based benefit plans would be subject to stockholder approval, historically, the overwhelming majority of stock-based benefit plans adopted by savings institutions and their holding companies following mutual-to-stock conversions have been approved by stockholders.

**We have not determined when we will adopt one or more new stock-based benefit plans. Stock-based benefit plans adopted more than 12 months following the completion of the conversion may exceed regulatory restrictions on the size of stock-based benefit plans adopted within 12 months, which would further increase our costs.**

If we adopt stock-based benefit plans more than 12 months following the completion of the conversion, then grants of shares of common stock or stock options under our proposed stock-based benefit plans may exceed 4% and 10%, respectively, of the shares of common stock sold in the stock offering and contributed to the charitable foundation. Stock-based benefit plans that provide for awards in excess of these amounts would increase our costs beyond the amounts estimated in "—Our stock-based benefit plans will increase our expenses and reduce our income." Stock-based benefit plans that provide for awards in excess of these amounts could also result in dilution to stockholders in excess of that described in "—The implementation of stock-based benefit plans may dilute your ownership interest. Historically, stockholders have approved these stock-based benefit plans." Although the implementation of stock-based benefit plans would be subject to stockholder approval, the timing of the implementation of such plans will be at the discretion of our board of directors.

**Our stock value may be negatively affected by applicable regulations that restrict stock repurchases.**

Applicable regulations generally restrict us from repurchasing our shares of common stock during the first year following the completion of the conversion and stock offering. Stock repurchases are a capital management tool that can enhance the value of a company's stock, and our inability to repurchase our shares of common stock during the first year following the stock offering may negatively affect our stock price.

**Various factors may make takeover attempts more difficult to achieve.**

Certain provisions of our articles of incorporation and bylaws and federal banking laws, including regulatory approval requirements, could make it more difficult for a third party to acquire control of Mercer Bancorp without our board of directors' approval. Under regulations applicable to the conversion, for a period of three years following completion of the conversion, no person may offer to acquire or acquire beneficial ownership of more than 10% of our common stock without prior approval of the Federal Reserve Board. Under federal law, subject to certain exemptions, a person, entity or group must notify the Federal Reserve Board and receive the Federal Reserve Board's non-objection before acquiring control of a bank holding company. There also are provisions in our articles of incorporation and bylaws that we may use to delay or block a takeover attempt, including a provision that prohibits any person from voting more than 10% of our outstanding shares of common stock. Furthermore, our directors and executive officers have indicated their intention to subscribe in the offering for an aggregate of 65,500 shares of common stock, equal to 5.7% of the shares of common stock to be issued in the offering and contributed to our charitable foundation at the minimum of the offering range, and our employee stock ownership plan intends to purchase 8% of the shares of common stock sold in the stock offering and contributed to the charitable foundation, in each case assuming shares are available for their purchase. These shares, plus shares of restricted stock and stock options that we may grant to employees and directors and other factors, may make it more difficult for companies or persons to acquire control of Mercer Bancorp without the consent of our board of directors and management, and may increase the cost of an acquisition. Taken as a whole, these statutory or regulatory provisions and provisions in our articles of incorporation and bylaws could result in our being less attractive to a potential acquirer and therefore could adversely affect the market price of our common stock. For additional information, see "Restrictions on Acquisition of Mercer Bancorp" and "Management – Benefits to be Considered Following Completion of the Conversion and Stock Offering."

**Our articles of incorporation provide that, subject to limited exception, state and federal courts in the State of Maryland are the sole and exclusive forum for certain stockholder litigation matters, which could limit our stockholders' ability to obtain a favorable judicial forum for disputes with us or our directors, officers, and other employees.**

The articles of incorporation of Mercer Bancorp provide that, unless Mercer Bancorp consents in writing to the selection of an alternative forum, the sole and exclusive forum for (i) any derivative action or proceeding brought on behalf of Mercer Bancorp, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of Mercer Bancorp to Mercer Bancorp or its stockholders, (iii) any action asserting a claim arising pursuant to any provision of the Maryland General Corporation Law, or (iv) any action asserting a claim governed by the internal affairs doctrine will be conducted in a state or federal court located within the State of Maryland, in all cases subject to the court's having personal jurisdiction over the indispensable parties named as defendants. This exclusive forum provision does not apply to claims arising under the federal securities laws. This exclusive forum provision may limit a stockholder's ability to bring a claim in a judicial forum it finds favorable for disputes with Mercer Bancorp and its directors, officers, and other employees or may cause a stockholder to incur additional expense by having to bring a claim in a judicial forum that is distant from where the stockholder resides, or both. In addition, if a court were to find this exclusive forum provision to be inapplicable or unenforceable in a particular action, we may incur additional costs associated with resolving the action in another jurisdiction, which could have a material adverse effect on our financial condition and results of operations.

**You may not revoke your decision to purchase Mercer Bancorp common stock in the subscription offering or in any community offering after you send us your order.**

Funds submitted or automatic withdrawals authorized in connection with the purchase of shares of common stock in the subscription offering and in any community offering will be held by us until the completion or termination of the conversion and stock offering, including any extension of the expiration date and consummation of a syndicated community offering. Because completion of the conversion and stock offering will be subject to regulatory approvals and an update of the independent appraisal, among other factors, there may be one or more delays in completing the conversion and stock offering. Orders submitted in the subscription offering and in any community offering are irrevocable, and purchasers will have no access to their funds unless the stock offering is terminated, or extended beyond [extended expiration date], or the number of shares to be sold in the stock offering is increased to more than 1,719,250 shares or decreased to fewer than 1,105,000 shares.

**The distribution of subscription rights could have adverse income tax consequences.**

If the subscription rights granted in connection with the stock offering are deemed to have an ascertainable value, receipt of such rights may be taxable in an amount equal to such value. Whether subscription rights are considered to have ascertainable value is an inherently factual determination. We have received an opinion of counsel that it is more likely than not that such rights have no value; however, such opinion is not binding on the Internal Revenue Service.

**<u>Risks Related to the Charitable Foundation</u>**

**The contribution to the charitable foundation will dilute your ownership interest and adversely affect net income in 2023.**

We intend to establish and fund a new charitable foundation in connection with the conversion and stock offering. We intend to contribute $100,000 in cash and 50,000 shares of common stock of Mercer Bancorp, for an aggregate contribution of $600,000 based on the $10.00 per share offering price, to the charitable foundation. The contribution will have an adverse effect on our net income for the quarter and year in which we make the issuance and contribution to the charitable foundation. The after-tax expense of the contribution is expected to reduce net income in the year of the contribution by approximately $474,000.

**Our contribution to the charitable foundation may not be tax deductible, which could reduce our profits.**

We may not have sufficient profits to be able to fully use the tax deduction from our contribution to the charitable foundation. Under the Internal Revenue Code, an entity is permitted to deduct up to 10% of its taxable income (generally income before federal income taxes and charitable contributions expense) in any one year for charitable contributions. Any contribution in excess of the 10% limit may be deducted for federal income tax purposes over each of the five years following the year in which the charitable contribution is made. Accordingly, a charitable contribution could, if necessary, be deducted over a six-year period and expires thereafter.

**SELECTED FINANCIAL AND OTHER DATA OF MERCER SAVINGS BANK**

The following tables set forth selected historical financial and other data of Mercer Savings Bank for the periods and at the dates indicated. The information at December 31, 2022 and for the three months ended December 31, 2022 and 2021 is not audited but, in the opinion of management, includes all adjustments necessary for a fair presentation. All of these adjustments are normal and recurring. The results of operations for the three months ended December 31, 2022 are not necessarily indicative of the results of operations that may be expected for the entire year. The information at and for the years ended September 30, 2022 and 2021 is derived in part from, and should be read together with, the audited financial statements and related notes beginning at page F-1 of this prospectus.

---

| | | | |
|:---|:---|:---|:---|
|  | | **At September 30,** | **At September 30,** |
|  | **At December 31,**<br>**2022** | **2022** | **2021** |
|  | **(In thousands)** | | |
| **Selected Financial Condition Data:** |  |  |  |
| Total assets | $146190 | $152883 | $147345 |
| Cash and cash equivalents | 7203 | 14377 | 18001 |
| Interest-bearing time deposits | 100 | 100 | 100 |
| Securities available for sale | 13321 | 12572 | 8585 |
| Securities held to maturity | 212 | 233 | 339 |
| Loans held for sale | 282 |  | 399 |
| Loans, net of allowance for loan losses | 117830 | 117671 | 112511 |
| Premises and equipment, net | 2603 | 2608 | 2416 |
| Federal Home Loan Bank stock | 1390 | 1390 | 1605 |
| Bank-owned life insurance | 1753 | 1742 | 2066 |
| Total deposits | 127699 | 134759 | 128245 |
| Federal Home Loan Bank advances | 3000 | 3000 | 4000 |
| Total equity | 14526 | 14056 | 14063 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended**<br> **December 31,** | **For the Three Months Ended**<br> **December 31,** | **For the Year Ended**<br> **September 30,** | **For the Year Ended**<br> **September 30,** |
|  | **2022** | **2021** | **2022** | **2021** |
|  | **(In thousands)** | **(In thousands)** | **(In thousands)** | **(In thousands)** |
| **Selected Operating Data:** |  |  |  |  |
| Interest income | $1394 | $1106 | $4595 | $4461 |
| Interest expense | 56 | 73 | 265 | 402 |
| Net interest income | 1338 | 1033 | 4330 | 4059 |
| Provision for loan losses |  | 15 | 25 | 180 |
| Net interest income after provision for loan losses | 1338 | 1018 | 4305 | 3879 |
| Noninterest income | 127 | 188 | 795 | 656 |
| Noninterest expense | 1060 | 977 | 3963 | 3821 |
| Income before income taxes | 405 | 229 | 1137 | 714 |
| Income tax expense | 76 | 50 | 193 | 143 |
| Net income | $329 | $179 | $944 | $571 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **At or For the**<br> **Three Months Ended**<br> **December 31,** | **At or For the**<br> **Three Months Ended**<br> **December 31,** | **At or For the**<br> **Year Ended**<br> **September 30,** | **At or For the**<br> **Year Ended**<br> **September 30,** |
|  | **2022** | **2021** | **2022** | **2021** |
| **Performance Ratios:** |  |  |  |  |
| Return on average assets (1) (2) | 0.88% | 0.48% | 0.62% | 0.39% |
| Return on average equity (1) (3) | 9.29% | 5.10% | 6.76% | 4.15% |
| Interest rate spread (4) | 3.68% | 2.84% | 2.92% | 2.84% |
| Net interest margin (1) (5) | 3.71% | 2.88% | 2.95% | 2.89% |
| Noninterest expense to average assets (1) | 2.84% | 2.61% | 2.60% | 2.60% |
| Efficiency ratio (6) | 72.35% | 80.02% | 77.33% | 81.04% |
| Average interest-earning assets to average interest-bearing liabilities | 122.74% | 118.91% | 120.53% | 119.31% |
| **Capital Ratios:** |  |  |  |  |
| Average equity to average assets | 9.49% | 9.39% | 9.17% | 9.37% |
| Total capital to risk-weighted assets | 16.80% | 16.60% | 16.60% | 16.40% |
| Tier 1 capital to risk-weighted assets | 15.80% | 15.50% | 15.60% | 15.30% |
| Common equity Tier 1 capital to risk-weighted assets | 15.80% | 15.50% | 15.60% | 15.30% |
| Tier 1 capital to average assets | 10.20% | 9.30% | 9.70% | 9.30% |
| **Asset Quality Ratios:** |  |  |  |  |
| Allowance for loan losses to total loans | 0.79% | 0.84% | 0.81% | 0.83% |
| Allowance for loan losses to non-performing loans | 222.45% | 926.67% | 281.14% | 449.77% |
| Allowance for loan losses to non-accrual loans | 222.45% | 926.67% | 281.14% | 449.77% |
| Net (charge-offs) recoveries to average outstanding loans | (0.02)% |  |  | (0.06)% |
| Non-accrual loans to total loans | 0.35% | 0.13% | 0.29% | 0.19% |
| Non-performing loans to total loans | 0.35% | 0.13% | 0.29% | 0.19% |
| Non-performing loans to total assets | 0.30% | 0.07% | 0.23% | 0.14% |
| Total non-performing assets to total assets | 0.30% | 0.07% | 0.23% | 0.14% |
| **Other:** |  |  |  |  |
| Number of offices | 4 | 4 | 4 | 4 |
| Number of full-time employees | 28 | 31 | 28 | 31 |
| Number of part-time employees | 2 | 3 | 3 | 3 |

---

(1) Annualized where appropriate.

(2) Represents net income divided
by average total assets.

(3) Represents net income divided
by average equity.

(4) Represents the difference between
the weighted average yield on average interest-earning assets and the weighted average cost of average interest-bearing liabilities.

(5) Represents net interest income
divided by average interest-earning assets.

(6) Represents noninterest expense
divided by the sum of net interest and dividend income and noninterest income.

**FORWARD-LOOKING STATEMENTS**

This prospectus contains forward-looking statements, which can be identified by the use of words such as "estimate," "project," "believe," "intend," "anticipate," "assume," "plan," "seek," "expect," "will," "may," "should," "indicate," "would," "believe," "contemplate," "continue," "target" and words of similar meaning. These forward-looking statements include, but are not limited to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· statements of our goals, intentions and expectations;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· statements regarding our business plans, prospects, growth and operating strategies;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· statements regarding the asset quality of our loan and investment portfolios; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· estimates of our risks and future costs and benefits.

These forward-looking statements are based on our current beliefs and expectations and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond our control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. We are under no duty to and do not take any obligation to update any forward-looking statements after the date of this prospectus.

The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations expressed in the forward-looking statements:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· general economic conditions, either nationally or in our market area, which are worse than expected, including the effects of inflation
and monetary policy;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· changes in the interest rate environment that reduce our margins and yields, the fair value of our financial instruments, or our level
of loan originations, or increase the level of defaults, losses and prepayments within our loan portfolio;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· adverse changes in the securities markets;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· changes in the level and direction of loan delinquencies and write-offs and changes in estimates of the adequacy of the allowance
for loan losses;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· our ability to manage market risk, credit risk and operational risk;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· our ability to access cost-effective funding;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· fluctuations in real estate values and in the conditions of the residential real estate, commercial real estate, and agricultural
real estate markets;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· demand for loans and deposits in our market area;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· our ability to implement and change our business strategies;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· competition among depository and other financial institutions;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· changes in laws or government regulations or policies affecting financial institutions, including changes in regulatory fees, capital
requirements and insurance premiums;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· changes in the quality or composition of our loan or investment portfolios;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· technological changes that may be more difficult or expensive than expected;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the inability of third-party providers to perform as expected;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· a failure or breach of our operational or information security systems or infrastructure, including cyberattacks;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· our ability to enter new markets successfully and capitalize on growth opportunities;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· changes in consumer spending, borrowing and savings habits;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· changes in accounting policies and practices, as may be adopted by the bank regulatory agencies, the Financial Accounting Standards
Board, the Securities and Exchange Commission or the Public Company Accounting Oversight Board;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· our ability to retain key employees;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· changes in the financial condition, results of operations or future prospects of issuers of securities that we own; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· public health emergencies, including the COVID-19 pandemic.

Because of these and a wide variety of other uncertainties, our actual future results may be materially different from the results indicated by these forward-looking statements. See "Risk Factors" beginning on page 13.

**HOW WE INTEND TO USE THE PROCEEDS FROM THE STOCK OFFERING**

Although we cannot determine what the actual net proceeds from the sale of the shares of common stock in the stock offering will be until the stock offering is completed, we anticipate that the net proceeds will be between $9.3 million and $13.2 million, or $15.4 million if the offering range is increased by 15%.

We intend to distribute the net proceeds as follows:

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| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Based Upon the Sale at $10.00 Per Share of:** | **Based Upon the Sale at $10.00 Per Share of:** | **Based Upon the Sale at $10.00 Per Share of:** | **Based Upon the Sale at $10.00 Per Share of:** | **Based Upon the Sale at $10.00 Per Share of:** | **Based Upon the Sale at $10.00 Per Share of:** | **Based Upon the Sale at $10.00 Per Share of:** | **Based Upon the Sale at $10.00 Per Share of:** |
|  | **1,105,000 Shares** | **1,105,000 Shares** | **1,300,000 Shares** | **1,300,000 Shares** | **1,495,000 Shares** | **1,495,000 Shares** | **1,719,250 Shares <sup>(1)</sup>** | **1,719,250 Shares <sup>(1)</sup>** |
|  | **Amount** | **Percent <br> of Net <br> Proceeds** | **Amount** | **Percent <br> of Net <br> Proceeds** | **Amount** | **Percent <br> of Net <br> Proceeds** | **Amount** | **Percent <br> of Net <br> Proceeds** |
|  | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** |
| Offering proceeds | $11050 |  | $13000 |  | $14950 |  | $17193 |  |
| Less: offering expenses | (1750) |  | (1750) |  | (1750) |  | (1750) |  |
| &nbsp;&nbsp;&nbsp;Net offering proceeds <sup>(2)</sup> | $9300 | 100.0% | $11250 | 100.0% | $13200 | 100.0% | $15443 | 100.0% |
| Distribution of net proceeds: |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;To Mercer Savings Bank | $(4650) | 50.0% | $(5625) | 50.0% | $(6600) | 50.0% | $(7722) | 50.0% |
| &nbsp;&nbsp;&nbsp;To fund cash contribution to charitable foundation | (100) | (1.1)% | (100) | (0.9)% | (100) | (0.8)% | (100) | (0.7)% |
| &nbsp;&nbsp;&nbsp;To fund loan to employee stock ownership plan | (924) | (9.9)% | (1080) | (9.6)% | (1236) | (9.4)% | (1415) | (9.2)% |
| &nbsp;&nbsp;&nbsp;Retained by Mercer Bancorp | $3626 | 39.0% | $4445 | 39.5% | $5264 | 39.9% | $6206 | 40.2% |

---

(1) As adjusted to give effect to an increase in the number of shares, which could occur due to a 15% increase in the offering range to
reflect demand for the shares or changes in market conditions following the commencement of the stock offering.

(2) Assumes that all shares of common stock are sold in the subscription offering and any community offering.

Payments for shares of common stock made through withdrawals from deposit accounts at Mercer Savings Bank will not result in the receipt of new funds for investment but will reduce Mercer Savings Bank's deposits. The net proceeds may vary because total offering expenses may be more or less than our estimates. For example, our expenses would increase if there were a syndicated community offering to sell shares of common stock not purchased in the subscription offering and any community offering.

Mercer Bancorp intends to loan funds to the employee stock ownership plan to purchase shares of common stock in the stock offering. It may also use the proceeds it retains from the stock offering:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· to repurchase shares of our common stock, in compliance with applicable regulatory requirements;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· to pay cash dividends to stockholders, if declared by our board of directors;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· to invest in securities consistent with our investment policy; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· for other general corporate purposes.

Except for the loan to the employee stock ownership plan and the cash contribution to the charitable foundation, Mercer Bancorp has not quantified its plans for use of the net proceeds of the stock offering for each of the foregoing purposes. Initially, we intend to invest a substantial portion of the net proceeds in investment grade securities, including securities issued by U.S. Government agencies and mortgage-backed securities issued by U.S. Government agencies and U.S. Government-sponsored enterprises.

See "Our Dividend Policy" for a discussion of our expected dividend policy. Under applicable federal regulations, we may not repurchase shares of our common stock during the first year following the completion of the conversion and stock offering, except when extraordinary circumstances exist and with prior regulatory approval, or except to fund management recognition plans (which would require notification to the FDIC) or tax-qualified employee stock benefit plans.

Mercer Savings Bank will receive a capital contribution from Mercer Bancorp equal to at least 50% of the net offering proceeds.

Mercer Savings Bank may use the net proceeds it receives from the stock offering:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· to fund new loans;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· to enhance existing products and services;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· to expand its banking franchise by establishing new branches or by acquiring other financial institutions or branches thereof as opportunities
arise – we currently intend to establish a fifth branch office during 2024; we do not currently have any understandings or agreements
regarding any acquisitions;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· to invest in securities consistent with our investment policy; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· for other general corporate purposes.

Mercer Savings Bank has not quantified its plans for use of the net proceeds of the stock offering for each of the foregoing purposes. Initially, a substantial portion of the net proceeds will be invested in securities issued by U.S. Government agencies and mortgage-backed securities issued by U.S. Government agencies and U.S. Government-sponsored enterprises. The use of the proceeds outlined above may change based on many factors, including, but not limited to, changes in interest rates, equity markets, laws and regulations affecting the financial services industry, our relative position in the financial services industry, the attractiveness of opportunities to expand our operations through acquisitions or establishing or acquiring branches, our ability to receive regulatory approval for any such expansion activities, and overall market conditions.

We expect our return on equity to decrease upon the completion of the conversion and stock offering until we are able to reinvest effectively the additional capital raised in the stock offering. See "Risk Factors – Risks Related to the Stock Offering – Our failure to effectively deploy the net proceeds may have an adverse effect on our financial performance."

**OUR DIVIDEND POLICY**

Following completion of the conversion and stock offering, our board of directors will have the authority to declare dividends on our shares of common stock, subject to statutory and regulatory requirements. However, no decision has been made with respect to the payment of dividends. In determining whether to pay a cash dividend and the amount of such cash dividend, the board of directors is expected to take into account a number of factors, including capital requirements, our financial condition and results of operations, other uses of funds for the long-term value of stockholders, tax considerations, statutory and regulatory limitations and general economic conditions. No assurances can be given that any dividends will be paid or that, if paid, will not be reduced or eliminated in the future. Special cash dividends, stock dividends or returns of capital, to the extent permitted by regulations and policies of the Federal Reserve Board, ODFI and FDIC, may be paid in addition to, or in lieu of, regular cash dividends.

Mercer Bancorp expects to file a consolidated federal income tax return with Mercer Savings Bank. Accordingly, it is anticipated that any cash distributions that we make to our stockholders would be treated as cash dividends and not as a non-taxable return of capital for federal and state income tax purposes. Additionally, pursuant to applicable regulations, during the three-year period following the stock offering, we will not take any action to declare an extraordinary dividend to stockholders that would be treated by recipients as a tax-free return of capital for federal income tax purposes.

Mercer Bancorp's articles of incorporation authorize the issuance of preferred stock. If we issue preferred stock, the holders thereof may have a priority over the holders of our shares of common stock with respect to the payment of dividends. For a further discussion concerning the payment of dividends on our shares of common stock, see "Description of Capital Stock of Mercer Bancorp – Common Stock." Any dividends we may declare and pay will depend, in part, upon receipt of dividends from Mercer Savings Bank, because dividends from Mercer Savings Bank will be our primary source of income. Applicable regulations impose limitations on dividends and other capital distributions by savings institutions like Mercer Savings Bank. See "Regulation and Supervision."

Any payment of dividends by Mercer Savings Bank to Mercer Bancorp that would be deemed to be drawn out of Mercer Savings Bank's bad debt reserves, if any, would require Mercer Savings Bank to pay taxes at the then-current tax rate on the amount of earnings deemed to be removed from the reserves for such distribution. Mercer Savings Bank does not intend to make any distribution to us that would create such a federal tax liability. See "Taxation."

**MARKET FOR THE COMMON STOCK**

Mercer Bancorp is a newly formed company and has never issued capital stock. Mercer Savings Bank, as a mutual institution, is not authorized to issue capital stock. Mercer Bancorp expects that that its common stock will be quoted on the OTCQB Market operated by OTC Markets Group upon the completion of the conversion and stock offering. However, following completion of the conversion, if we meet Nasdaq listing requirements, we will use our best efforts to obtain approval for our shares of common stock to trade on the Nasdaq Stock Market.

The development of an active trading market depends on the existence of willing buyers and sellers, which is not within our control or that of any market maker. The number of active buyers and sellers of the shares of common stock at any particular time may be limited. Furthermore, we cannot assure you that, if you purchase shares of common stock, you will be able to sell them at or above $10.00 per share purchase price. Purchasers of common stock in this stock offering should have long-term investment intent and should recognize that there will be a limited trading market in the common stock. This may make it difficult to sell the common stock after the stock offering and may have an adverse impact on the price at which the common stock can be sold.

**HISTORICAL AND PRO FORMA REGULATORY CAPITAL COMPLIANCE**

At December 31, 2022, Mercer Savings Bank was classified as "well capitalized" for regulatory capital purposes. The table below sets forth the historical equity capital and regulatory capital of Mercer Savings Bank at December 31, 2022, and the pro forma equity capital and regulatory capital of Mercer Savings Bank after giving effect to the sale of shares of common stock at $10.00 per share, all compared to levels required to be considered "well capitalized." See "How We Intend to Use the Proceeds from the Offering."

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| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Mercer Savings Bank <br> Historical at** | **Mercer Savings Bank <br> Historical at** | **Pro Forma at December 31, 2022, Based Upon the Sale in the Offering of: (1)** | **Pro Forma at December 31, 2022, Based Upon the Sale in the Offering of: (1)** | **Pro Forma at December 31, 2022, Based Upon the Sale in the Offering of: (1)** | **Pro Forma at December 31, 2022, Based Upon the Sale in the Offering of: (1)** | **Pro Forma at December 31, 2022, Based Upon the Sale in the Offering of: (1)** | **Pro Forma at December 31, 2022, Based Upon the Sale in the Offering of: (1)** | **Pro Forma at December 31, 2022, Based Upon the Sale in the Offering of: (1)** | **Pro Forma at December 31, 2022, Based Upon the Sale in the Offering of: (1)** |
|  | **December 31, 2022** | **December 31, 2022** | **1,105,000 Shares** | **1,105,000 Shares** | **1,300,000 Shares** | **1,300,000 Shares** | **1,495,000 Shares** | **1,495,000 Shares** | **1,719,250 Shares (2)** | **1,719,250 Shares (2)** |
|  | **Amount** | **Percent of Assets** | **Amount** | **Percent of Assets** | **Amount** | **Percent of Assets** | **Amount** | **Percent of Assets** | **Amount** | **Percent of Assets** |
|  | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** |
| Equity | $14526 | 9.9% | $17790 | 11.9% | $18531 | 12.3% | $19272 | 12.8% | $20125 | 13.3% |
| Tier 1 leverage capital (3)(4) | $15181 | 10.2% | $18445 | 12.1% | $19186 | 12.5% | $19927 | 12.9% | $20780 | 13.4% |
| Tier 1 leverage requirement | 7473 | 5.0 | 7637 | 5.0 | 7674 | 5.0 | 7711 | 5.0 | 7753 | 5.0 |
| Excess | $7708 | 5.2% | $10808 | 7.0% | $11512 | 7.5% | $12216 | 7.9% | $13027 | 8.4% |
| Tier 1 risk-based capital (3)(4) | $15181 | 15.8% | $18445 | 19.1% | $19186 | 19.8% | $19927 | 20.5% | $20780 | 21.4% |
| Tier 1 risk-based requirement | 7673 | 8.0 | 7725 | 8.0 | 7737 | 8.0 | 7749 | 8.0 | 7762 | 8.0 |
| Excess | $7508 | 7.8% | $10720 | 11.1% | $11449 | 11.8% | $12178 | 12.5% | $13018 | 13.4% |
| Total risk-based capital (3)(4) | $16142 | 16.8% | $19406 | 20.0% | $20147 | 20.8% | $20888 | 21.5% | $21741 | 22.4% |
| Total risk-based requirement | 9591 | 10.0 | 9656 | 10.0 | 9671 | 10.0 | 9686 | 10.0 | 9703 | 10.0 |
| Excess | $6551 | 6.8% | $9750 | 10.0% | $10476 | 10.8% | $11202 | 11.5% | $12038 | 12.4% |
| Common equity tier 1 risk-based capital (3)(4) | $15181 | 15.8% | $18445 | 19.1% | $19186 | 19.8% | $19927 | 20.5% | $20780 | 21.4% |
| Common equity tier 1 risk-based requirement | 6234 | 6.5 | 6278 | 6.5 | 6286 | 6.5 | 6296 | 6.5 | 6307 | 6.5 |
| Excess | $8974 | 9.3% | $12168 | 12.6% | $12900 | 13.3% | $13631 | 14.0% | $14473 | 14.9% |
| &nbsp;&nbsp;&nbsp;&nbsp;Reconciliation of capital infused into Mercer Savings Bank: |  |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Net proceeds contributed to Mercer Savings Bank |  |  | $4650 |  | $5625 |  | $6600 |  | $7722 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Less: Common stock acquired by employee stock ownership plan |  |  | (924) |  | (1080) |  | (1236) |  | (1415) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Less: Common stock acquired by stock-based benefit plan |  |  | (462) |  | (540) |  | (618) |  | (708) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Pro forma increase |  |  | $3264 |  | $4005 |  | $4746 |  | $5599 |  |

---

(1) Pro
 forma capital levels assume that the employee stock ownership plan purchases 8% of the shares
 of common stock sold in the stock offering and contributed to the charitable foundation with
 funds we lend and that our stock-based benefit plan purchases 4% of the shares sold in the
 offering and contributed to the charitable foundation for restricted stock awards. Pro forma
 capital calculated under generally accepted accounting principles ("GAAP") and
 regulatory capital have been reduced by the amount required to fund these plans. See "Management"
 for a discussion of the employee stock ownership plan.

(2) As
 adjusted to give effect to an increase in the number of shares, which could occur due to
 a 15% increase in the offering range to reflect demand for the shares or changes in market
 conditions following the commencement of the offering.

(3) Tier
 1 leverage capital levels are shown as a percentage of total average assets. Risk-based capital
 levels are shown as a percentage of risk-weighted assets.

(4) Pro
 forma amounts and percentages assume net proceeds are invested in assets that carry a 20%
 risk weighting.

**CAPITALIZATION**

The following table presents the historical capitalization of Mercer Savings Bank at December 31, 2022 and the pro forma consolidated capitalization of Mercer Bancorp at the same date after giving effect to the conversion and stock offering, based upon the assumptions set forth under the section entitled "Pro Forma Data."

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | | **Mercer Bancorp Pro Forma at December 31, 2022 <br> Based on the Sale in the Stock Offering at $10.00 per Share of:** | **Mercer Bancorp Pro Forma at December 31, 2022 <br> Based on the Sale in the Stock Offering at $10.00 per Share of:** | **Mercer Bancorp Pro Forma at December 31, 2022 <br> Based on the Sale in the Stock Offering at $10.00 per Share of:** | **Mercer Bancorp Pro Forma at December 31, 2022 <br> Based on the Sale in the Stock Offering at $10.00 per Share of:** |
|  | **Mercer Savings Bank at**<br>**December 31, 2022** | **1,105,000 Shares** | **1,300,000 Shares** | **1,495,000 Shares** | **1,719,250 Shares <sup>(1)</sup>** |
|  | **(Dollars in thousands, except per share amounts)** | **(Dollars in thousands, except per share amounts)** | **(Dollars in thousands, except per share amounts)** | **(Dollars in thousands, except per share amounts)** | **(Dollars in thousands, except per share amounts)** |
| Deposits <sup>(2)</sup> | $127699 | $127699 | $127699 | $127699 | $127699 |
| Borrowings | 3000 | 3000 | 3000 | 3000 | 3000 |
| &nbsp;&nbsp;&nbsp;Total deposits and borrowings | $130699 | $130699 | $130699 | $130699 | $130699 |
| **Stockholders' equity:** |  |  |  |  |  |
| Preferred stock, $0.01 par value, 1,000,000 shares authorized | $— | $— | $— | $— | $— |
| Common stock, $0.01 par value, 9,000,000 shares authorized; shares to be issued as shown <sup>(3)</sup> |  | 12 | 14 | 15 | 18 |
| Additional paid-in capital <sup>(4)</sup> |  | 9788 | 11736 | 13685 | 15925 |
| Retained earnings <sup>(5)</sup> | 15288 | 15288 | 15288 | 15288 | 15288 |
| Accumulated other comprehensive loss | (763) | (763) | (763) | (763) | (763) |
| **Less:** |  |  |  |  |  |
| Cash contribution to charitable foundation (after-tax) |  | 79 | 79 | 79 | 79 |
| Stock contribution to charitable foundation (after-tax) |  | 395 | 395 | 395 | 395 |
| Common stock held by employee stock ownership plan <sup>(6)</sup> |  | 924 | 1080 | 1236 | 1415 |
| Common stock to be acquired by stock-based benefit plan <sup>(7)</sup> |  | 462 | 540 | 618 | 708 |
| Total stockholders' equity | $14526 | $22465 | $24181 | $25897 | $27871 |
| **Pro Forma Shares Outstanding:** |  |  |  |  |  |
| Shares sold in stock offering |  | 1105000 | 1300000 | 1495000 | 1719250 |
| Shares contributed to charitable foundation |  | 50000 | 50000 | 50000 | 50000 |
| Total stockholders' equity as a percentage of total assets <sup>(2)</sup> | 9.9% | 14.6% | 15.5% | 16.4% | 17.5% |
| Tangible equity as a percentage of tangible assets <sup>(2)</sup> | 9.9% | 14.6% | 15.5% | 16.4% | 17.5% |

---

(1) As
 adjusted to give effect to an increase in the number of shares of common stock that could
 occur due to a 15% increase in the offering range to reflect demand for shares or changes
 in market conditions following the commencement of the subscription and community offerings.

(2) Does
 not reflect withdrawals from deposit accounts for the purchase of shares of common stock
 in the conversion and stock offering. These withdrawals would reduce pro forma deposits and
 assets by the amount of the withdrawals.

(3) No
 effect has been given to the issuance of additional shares of Mercer Bancorp common stock
 pursuant to the exercise of options under a stock-based benefit plan. If the plan is implemented
 within the first year after the closing of the stock offering, an amount up to 10% of the
 shares of Mercer Bancorp common stock sold in the stock offering and contributed to the charitable
 foundation will be reserved for issuance upon the exercise of options under the plan.

(4) On
 a pro forma basis, common stock and additional paid-in capital have been revised to reflect
 the number of shares of Mercer Bancorp common stock to be outstanding.

(5) The
 retained earnings of Mercer Savings Bank will be substantially restricted after the conversion
 and stock offering. See "The Conversion and Stock Offering – Liquidation Rights"
 and "Regulation and Supervision."

(6) Assumes
 that 8% of the shares sold in the stock offering and contributed to the charitable foundation
 will be acquired by the employee stock ownership plan and will be financed by a loan from
 Mercer Bancorp. The loan will be repaid principally from Mercer Savings Bank's contributions
 to the employee stock ownership plan. Since Mercer Bancorp will lend the funds to the employee
 stock ownership plan, this debt will be eliminated through consolidation and no liability
 will be reflected on Mercer Bancorp's consolidated financial statements. Accordingly,
 the amount of shares of common stock acquired by the employee stock ownership plan is shown
 in this table as a reduction of total stockholders' equity.

(7) If
 approved by Mercer Bancorp's stockholders, a stock-based benefit plan may purchase
 an aggregate number of shares of common stock equal to 4% of the shares sold in the stock
 offering and contributed to the charitable foundation (or possibly a greater number of shares
 if the plan is implemented more than one year after completion of the conversion and stock
 offering, or a lesser number if Mercer Savings Bank were to have a Tier 1 leverage ratio
 of less than 10.0% within one year of the completion of the conversion and stock offering).
 Stockholder approval of the stock-based benefit plan, and purchases by the plan, may not
 occur earlier than six months after the completion of the conversion and stock offering.
 The shares may be acquired directly from Mercer Bancorp or through open market purchases.
 The funds to be used by the stock-based benefit plans to purchase the shares will be provided
 by Mercer Bancorp. Assumes a number of shares of common stock equal to 4% of the shares of
 common stock sold in the stock offering and contributed to the charitable foundation for
 grant under a stock-based benefit plan will be purchased in the open market by Mercer Bancorp.
 The dollar amount of common stock to be purchased is based on the $10.00 per share subscription
 price in the stock offering and represents unearned compensation. This amount does not reflect
 possible increases or decreases in the value of common stock relative to the subscription
 price in the stock offering. As Mercer Bancorp accrues compensation expense to reflect the
 vesting of shares pursuant to the stock-based benefit plan, the credit to equity will be
 offset by a charge to noninterest expense.

**PRO FORMA DATA**

The following tables summarize historical data of Mercer Savings Bank and pro forma data of Mercer Bancorp at and for the three months ended December 31, 2022 and the year ended September 30, 2022. This information is based on assumptions set forth below and in the tables, and should not be used as a basis for projections of market value of the shares of common stock following the conversion and stock offering.

The net proceeds in the tables are based upon the following assumptions:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· all shares of common stock will be sold in the subscription offering;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· our employee stock ownership plan will purchase 8% of the shares of common stock sold in the stock offering and contributed to the
charitable foundation, funded by a loan from Mercer Bancorp. The loan will be repaid in substantially equal payments of principal and
interest (at the prime interest rate, adjusted annually) over a period of 15 years;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Mercer Bancorp will contribute $100,000 in cash to the charitable foundation; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· estimated expenses of the stock offering, including fees and expenses to be paid to Performance Trust, are $1.75 million.

Pro forma earnings on net proceeds have been calculated assuming the stock has been sold at the beginning of the period and the net proceeds have been invested at a yield of 5.00% for the three months ended December 31, 2022 and 4.05% for the year ended September 30, 2022, which is the yield on the one-year U.S. Treasury Note rate at those dates. In light of current market interest rates, we consider this rate to reflect the pro forma reinvestment rate more accurately than the arithmetic average of the weighted average yield earned on our interest-earning assets and the weighted average rate paid on our deposits, which is the reinvestment rate generally required by applicable regulations. The pro forma after-tax yield on the net offering proceeds is assumed to be 3.95% for the three months ended December 31, 2022 and 3.20% for the year ended September 30, 2022, based on an effective tax rate of 21.0%.

We calculated historical and pro forma per share amounts by dividing historical and pro forma amounts of consolidated net income and stockholders' equity by the indicated number of shares of common stock. We adjusted the earnings figures to give effect to the shares of common stock purchased by the employee stock ownership plan. We computed per share amounts for each period as if the shares of common stock were outstanding at the beginning of each period, but we did not adjust per share historical or pro forma stockholders' equity to reflect the earnings on the estimated net proceeds.

The pro forma tables give effect to the implementation of a stock-based benefit plan. Subject to the receipt of stockholder approval, we have assumed that the stock-based benefit plan will acquire for restricted stock awards a number of shares of common stock equal to 4% of our outstanding shares of common stock at the same price for which they were sold in the stock offering. We assume that shares of common stock are granted under the plan in awards that vest over a five-year period.

We have also assumed that the stock-based benefit plan will grant options to acquire shares of common stock equal to 10% of our outstanding shares of common stock. In preparing the tables below, we assumed that stockholder approval was obtained, that the exercise price of the stock options and the market price of the stock at the date of grant were $10.00 per share and that the stock options have a term of ten years and vested over five years. We applied the Black-Scholes option pricing model to estimate a grant-date fair value of $3.72 for each option. In addition to the terms of the options described above, the Black-Scholes option pricing model assumed an estimated volatility rate of 23.1% for the shares of common stock, a dividend yield of 0%, an expected option life of 7.5years and a risk-free interest rate of 4.1%.

We may reserve shares for the exercise of stock options and the grant of stock awards under a stock-based benefit plan in excess of 10% and 4%, respectively, of our total outstanding shares if the stock-based benefit plan is adopted more than one year following the stock offering. In addition, we may grant options and award shares that vest more rapidly than over a five-year period if the stock-based benefit plan is adopted more than one year following the stock offering.

As discussed under "How We Intend to Use the Proceeds from the Stock Offering," Mercer Bancorp intends to contribute to Mercer Savings Bank 50% of the net offering proceeds and retain the remainder of the net offering proceeds. Mercer Bancorp will use a portion of the net offering proceeds it retains for the purpose of making a loan to the employee stock ownership plan and to contribute $100,000 in cash to the charitable foundation, and retain the remainder of the net offering proceeds for future use.

The pro forma table does not give effect to: (i) withdrawals from deposit accounts for the purpose of purchasing shares of common stock in the stock offering; (ii) Mercer Bancorp's results of operations after the conversion and stock offering; or (iii) changes in the market price of the shares of common stock after the conversion and stock offering.

The following pro forma information may not represent the financial effects of the stock offering at the date on which the stock offering actually occurs and you should not use the table to indicate future results of operations. Pro forma stockholders' equity represents the difference between the stated amount of our assets and liabilities, computed according to GAAP. We did not increase or decrease stockholders' equity to reflect the difference between the carrying value of loans and other assets and their market value. Pro forma stockholders' equity is not intended to represent the fair market value of the shares of common stock and may be different than the amounts that would be available for distribution to stockholders if we liquidated. Pro forma stockholders' equity does not give effect to the impact of intangible assets, bad debt reserve or the liquidation account we will establish in the conversion in the unlikely event we are liquidated.

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **At or for the Three Months Ended December 31, 2022**<br> **Based on the Sale at $10.00 Per Share of:** | **At or for the Three Months Ended December 31, 2022**<br> **Based on the Sale at $10.00 Per Share of:** | **At or for the Three Months Ended December 31, 2022**<br> **Based on the Sale at $10.00 Per Share of:** | **At or for the Three Months Ended December 31, 2022**<br> **Based on the Sale at $10.00 Per Share of:** |
|  | **1,105,000 Shares** | **1,300,000 Shares** | **1,495,000 Shares** | **1,719,250 Shares <sup>(1)</sup>** |
|  | **(Dollars in thousands, except per share amounts)** | **(Dollars in thousands, except per share amounts)** | **(Dollars in thousands, except per share amounts)** | **(Dollars in thousands, except per share amounts)** |
| Gross offering proceeds | $11050 | $13000 | $14950 | $17193 |
| Plus: Market value of common stock contributed to charitable foundation | 500 | 500 | 500 | 500 |
| Pro forma market capitalization | 11550 | 13500 | 15450 | 17693 |
| Gross offering proceeds | $11050 | $13000 | $14950 | $17193 |
| Less: Estimated expenses | (1750) | (1750) | (1750) | (1750) |
| &nbsp;&nbsp;&nbsp;Estimated net proceeds | 9300 | 11250 | 13200 | 15443 |
| &nbsp;&nbsp;&nbsp;Less: Cash contribution to charitable foundation | (100) | (100) | (100) | (100) |
| &nbsp;&nbsp;&nbsp;Less: Common stock acquired by ESOP <sup>(2)</sup> | (924) | (1080) | (1236) | (1415) |
| &nbsp;&nbsp;&nbsp;Less: Common stock acquired by stock-based benefit plans <sup>(3)(4)</sup> | (462) | (540) | (618) | (708) |
| &nbsp;&nbsp;&nbsp;Estimated net proceeds | $7814 | $9530 | $11246 | $13220 |
| **<u>For the Three Months Ended December 31, 2022</u>** |  |  |  |  |
| Consolidated net income: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Historical (annualized) | $1314 | $1314 | $1314 | $1314 |
| Pro forma adjustments (annualized): |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income on adjusted net proceeds | 309 | 376 | 444 | 522 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Employee stock ownership plan <sup>(2)</sup> | (49) | (57) | (65) | (75) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stock awards <sup>(3)</sup> | (73) | (85) | (98) | (112) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stock options <sup>(4)</sup> | (86) | (100) | (115) | (132) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pro forma net income (annualized) | $1415 | $1448 | $1480 | $1517 |
| Income per share: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Historical (annualized) | $1.23 | $1.05 | $0.92 | $0.80 |
| Pro forma adjustments: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income on adjusted net proceeds | 0.29 | 0.30 | 0.31 | 0.32 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Employee stock ownership plan <sup>(2)</sup> | (0.05) | (0.05) | (0.05) | (0.05) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stock awards <sup>(3)</sup> | (0.07) | (0.07) | (0.07) | (0.07) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stock options <sup>(4)</sup> | (0.08) | (0.08) | (0.08) | (0.08) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pro forma earnings per share (annualized) | $1.32 | $1.16 | $1.04 | $0.93 |
| Offering price to pro forma net earnings per share | 7.8x | 8.62x | 9.62x | 10.75x |
| Number of shares used in earnings per share calculations | 1068760 | 1249200 | 1429640 | 1637146 |
| **<u>At December 31, 2022</u>** |  |  |  |  |
| Stockholders' equity: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Historical | $14526 | $14526 | $14526 | $14526 |
| &nbsp;&nbsp;&nbsp;Estimated net proceeds | 9300 | 11250 | 13200 | 15443 |
| &nbsp;&nbsp;&nbsp;Common stock contributed to charitable foundation | 500 | 500 | 500 | 500 |
| &nbsp;&nbsp;&nbsp;Less: After-tax cost of contribution to charitable foundation | (474) | (474) | (474) | (474) |
| &nbsp;&nbsp;&nbsp;Less: Common stock acquired by employee stock ownership plan <sup>(2)</sup> | (924) | (1080) | (1236) | (1415) |
| &nbsp;&nbsp;&nbsp;Less: Common stock acquired by stock-based benefit plans <sup>(3)(4)</sup> | (462) | (540) | (618) | (708) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pro forma stockholders' equity <sup>(5)</sup> | $22466 | $24182 | $25898 | $27872 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pro forma tangible stockholders' equity <sup>(5)</sup> | $22466 | $24182 | $25898 | $27872 |
| Stockholders' equity per share: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Historical | $12.58 | $10.76 | $9.40 | $8.21 |
| &nbsp;&nbsp;&nbsp;Estimated net proceeds | 8.05 | 8.33 | 8.54 | 8.73 |
| &nbsp;&nbsp;&nbsp;Common stock contributed to charitable foundation | 0.43 | 0.37 | 0.32 | 0.28 |
| &nbsp;&nbsp;&nbsp;Less: After-tax cost of contribution to charitable foundation | (0.41) | (0.35) | (0.31) | (0.27) |
| &nbsp;&nbsp;&nbsp;Less: Common stock acquired by employee stock ownership plan<sup>(2)</sup> | (0.80) | (0.80) | (0.80) | (0.80) |
| &nbsp;&nbsp;&nbsp;Less: Common stock acquired by stock-based benefit plans <sup>(3)(4)</sup> | (0.40) | (0.40) | (0.40) | (0.40) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pro forma stockholders' equity per share <sup>(5)</sup> | $19.45 | $17.91 | $16.76 | $15.75 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pro forma tangible stockholders' equity per share <sup>(5)</sup> | $19.45 | $17.91 | $16.76 | $15.75 |
| &nbsp;&nbsp;&nbsp;Offering price as percentage of pro forma stockholders' equity per share | 51.4% | 55.8% | 59.7% | 63.5% |
| &nbsp;&nbsp;&nbsp;Offering price as percentage of pro forma tangible stockholders' equity per share | 51.4% | 55.8% | 59.7% | 63.5% |
| &nbsp;&nbsp;&nbsp;Number of shares outstanding for pro forma book value per share calculations | 1155000 | 1350000 | 1545000 | 1769250 |

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*(Footnotes begin on second following page)*

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **At or for the Year Ended September 30, 2022**<br> **Based on the Sale at $10.00 Per Share of:** | **At or for the Year Ended September 30, 2022**<br> **Based on the Sale at $10.00 Per Share of:** | **At or for the Year Ended September 30, 2022**<br> **Based on the Sale at $10.00 Per Share of:** | **At or for the Year Ended September 30, 2022**<br> **Based on the Sale at $10.00 Per Share of:** |
|  | **1,105,000 Shares** | **1,300,000 Shares** | **1,495,000 Shares** | **1,719,250 Shares <sup>(1)</sup>** |
|  | **(Dollars in thousands, except per share amounts)** | **(Dollars in thousands, except per share amounts)** | **(Dollars in thousands, except per share amounts)** | **(Dollars in thousands, except per share amounts)** |
| Gross offering proceeds | $11050 | $13000 | $14950 | $17193 |
| Plus: Market value of common stock contributed to charitable foundation | 500 | 500 | 500 | 500 |
| Pro forma market capitalization | 11550 | 13500 | 15450 | 17693 |
| Gross offering proceeds | $11050 | $13000 | $14950 | $17193 |
| Less: Estimated expenses | (1750) | (1750) | (1750) | (1750) |
| &nbsp;&nbsp;&nbsp;Estimated net proceeds | 9300 | 11250 | 13200 | 15443 |
| &nbsp;&nbsp;&nbsp;Less: Cash contribution to charitable foundation | (100) | (100) | (100) | (100) |
| &nbsp;&nbsp;&nbsp;Less: Common stock acquired by ESOP <sup>(2)</sup> | (924) | (1080) | (1236) | (1415) |
| &nbsp;&nbsp;&nbsp;Less: Common stock acquired by stock-based benefit plans <sup>(3)(4)</sup> | (462) | (540) | (618) | (708) |
| &nbsp;&nbsp;&nbsp;Estimated net proceeds | $7814 | $9530 | $11246 | $13220 |
| **<u>For the Year Ended September 30, 2022</u>** |  |  |  |  |
| Consolidated net income: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Historical | $944 | $944 | $944 | $944 |
| Pro forma adjustments: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income on adjusted net proceeds | 250 | 305 | 360 | 423 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Employee stock ownership plan <sup>(2)</sup> | (49) | (57) | (65) | (75) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stock awards <sup>(3)</sup> | (73) | (85) | (98) | (112) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stock options <sup>(4)</sup> | (86) | (100) | (115) | (132) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pro forma net income | $986 | $1007 | $1026 | $1048 |
| Income per share: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Historical | $0.88 | $0.76 | $0.66 | $0.58 |
| Pro forma adjustments: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income on adjusted net proceeds | 0.23 | 0.24 | 0.25 | 0.26 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Employee stock ownership plan <sup>(2)</sup> | (0.05) | (0.05) | (0.05) | (0.05) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stock awards <sup>(3)</sup> | (0.07) | (0.07) | (0.07) | (0.07) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stock options <sup>(4)</sup> | (0.08) | (0.08) | (0.08) | (0.08) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pro forma earnings per share | $0.92 | $0.81 | $0.72 | $0.64 |
| Offering price to pro forma net earnings per share | 10.87x | 12.35x | 13.89x | 15.63x |
| Number of shares used in earnings per share calculations | 1068760 | 1249200 | 1429640 | 1637146 |
| **<u>At September 30, 2022</u>** |  |  |  |  |
| Stockholders' equity: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Historical | $14056 | $14056 | $14056 | $14056 |
| &nbsp;&nbsp;&nbsp;Estimated net proceeds | 9300 | 11250 | 13200 | 15443 |
| &nbsp;&nbsp;&nbsp;Common stock contributed to charitable foundation | 500 | 500 | 500 | 500 |
| &nbsp;&nbsp;&nbsp;Less: After-tax cost of contribution to charitable foundation | (474) | (474) | (474) | (474) |
| &nbsp;&nbsp;&nbsp;Less: Common stock acquired by employee stock ownership plan <sup>(2)</sup> | (924) | (1080) | (1236) | (1415) |
| &nbsp;&nbsp;&nbsp;Less: Common stock acquired by stock-based benefit plans <sup>(3)(4)</sup> | (462) | (540) | (618) | (708) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pro forma stockholders' equity <sup>(5)</sup> | $21996 | $23712 | $25428 | $27402 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pro forma tangible stockholders' equity <sup>(5)</sup> | $21996 | $23712 | $25428 | $27402 |
| Stockholders' equity per share: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Historical | $12.17 | $10.41 | $9.10 | $7.94 |
| &nbsp;&nbsp;&nbsp;Estimated net proceeds | 8.05 | 8.33 | 8.54 | 8.73 |
| &nbsp;&nbsp;&nbsp;Common stock contributed to charitable foundation | 0.43 | 0.37 | 0.32 | 0.28 |
| &nbsp;&nbsp;&nbsp;Less: After-tax cost of contribution to charitable foundation | (0.41) | (0.35) | (0.31) | (0.27) |
| &nbsp;&nbsp;&nbsp;Less: Common stock acquired by employee stock ownership plan <sup>(2)</sup> | (0.80) | (0.80) | (0.80) | (0.80) |
| &nbsp;&nbsp;&nbsp;Less: Common stock acquired by stock-based benefit plans <sup>(3)(4)</sup> | (0.40) | (0.40) | (0.40) | (0.40) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pro forma stockholders' equity per share <sup>(5)</sup> | $19.04 | $17.56 | $16.46 | $15.49 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pro forma tangible stockholders' equity per share <sup>(5)</sup> | $19.04 | $17.56 | $16.46 | $15.49 |
| &nbsp;&nbsp;&nbsp;Offering price as percentage of pro forma stockholders' equity per share | 52.5% | 56.9% | 60.8% | 64.6% |
| &nbsp;&nbsp;&nbsp;Offering price as percentage of pro forma tangible stockholders' equity per share | 52.5% | 56.9% | 60.8% | 64.6% |
| &nbsp;&nbsp;&nbsp;Number of shares outstanding for pro forma book value per share calculations | 1155000 | 1350000 | 1545000 | 1769250 |

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*(Footnotes begin on following page)*

(1) As adjusted to give effect to an increase in the number of shares which could occur due to a 15% increase in the offering range to
reflect demand for the shares or changes in market conditions following the commencement of the stock offering.

(2) Assumes that 8% of shares of common stock sold in the stock offering and contributed to the charitable foundation will be purchased
by the employee stock ownership plan. For purposes of this table, the funds used to acquire these shares are assumed to have been borrowed
by the employee stock ownership plan from Mercer Bancorp. Mercer Savings Bank intends to make annual contributions to the employee stock
ownership plan in an amount at least equal to the required principal and interest payments on the debt. Mercer Savings Bank's total
annual payments on the employee stock ownership plan debt are based upon 15 equal annual installments of principal and interest. Financial
Accounting Standards Board Accounting Standards Codification 718-40, "Employers' Accounting for Employee Stock Ownership Plans"
("ASC 718-40") requires that an employer record compensation expense in an amount equal to the fair value of the shares committed
to be released to employees. The pro forma adjustments assume that the shares are allocated in equal annual installments based on the
number of loan repayment installments assumed to be paid by Mercer Savings Bank, the fair value of the common stock remains equal to the
subscription price and the employee stock ownership plan expense reflects an effective tax rate of 21%. The unallocated shares are reflected
as a reduction of stockholders' equity. No reinvestment is assumed on proceeds contributed to fund the employee stock ownership
plan. The pro forma net income for the three months ended December 31, 2022 assumes that 6,160, 7,200, 8,240 and 9,436 shares were
committed to be released during the period at the minimum, midpoint, maximum, and adjusted maximum of the offering range, respectively.
The pro forma net income for the year ended September 30, 2022 assumes that 6,160, 7,200, 8,240 and 9,436 shares were committed to
be released during the period at the minimum, midpoint, maximum, and adjusted maximum of the offering range, respectively. According to
ASC 718-40, only the shares committed to be released during the period were considered outstanding for purposes of income per share calculations.

(3) If approved by Mercer Bancorp's stockholders, a stock-based benefit plan may purchase an aggregate number of shares of common
stock equal to 4% of the shares sold in the stock offering and contributed to the charitable foundation (or possibly a greater number
of shares if the plan is implemented more than one year after completion of the conversion and stock offering, or a lesser number if Mercer
Savings Bank were to have a Tier 1 leverage ratio of less than 10.0% within one year of the completion of the conversion and stock offering).
Stockholder approval of the stock-based benefit plan, and purchases by the plan, may not occur earlier than six months after the completion
of the conversion and stock offering. The shares may be acquired directly from Mercer Bancorp or through open market purchases. The funds
to be used by the stock-based benefit plans to purchase the shares will be provided by Mercer Bancorp. The table assumes that (i) the
stock-based benefit plan acquires the shares through open market purchases at $10.00 per share, (ii) 20% of the amount contributed
to the stock-based benefit plan is amortized as an expense during the period, and (iii) the stock-based benefit plan expense reflects
an effective tax rate of 21%. Assuming stockholder approval of the stock-based benefit plan and that shares of common stock equal to 4%
of the shares sold in the stock offering and contributed to the charitable foundation are awarded through the use of authorized but unissued
shares of common stock, stockholders would have their ownership and voting interests diluted by approximately 3.85%.

(4) If approved by Mercer Bancorp's stockholders, a stock-based benefit plan may grant options to acquire an aggregate number of
shares of common stock equal to 10% of the shares to be sold in the stock offering and contributed to the charitable foundation (or possibly
a greater number of shares if the plan is implemented more than one year after completion of the conversion and stock offering). Stockholder
approval of the stock-based benefit plan may not occur earlier than six months after the completion of the conversion and stock offering.
In calculating the pro forma effect of the stock options to be granted under a stock-based benefit plan, it is assumed that the exercise
price of the stock options and the trading price of the common stock at the date of grant were $10.00 per share, the estimated grant-date
fair value determined using the Black-Scholes option pricing model was $3.72 for each option, and the aggregate grant-date fair value
of the stock options was amortized to expense on a straight-line basis over a five-year vesting period of the options. The actual expense
of the stock options to be granted under the stock-based benefit plan will be determined by the grant-date fair value of the options,
which will depend on a number of factors, including the valuation assumptions used in the option pricing model ultimately adopted. Under
the above assumptions, the adoption of the stock-based benefit plan will result in no additional shares under the treasury stock method
for purposes of calculating earnings per share. There can be no assurance that the actual exercise price of the stock options will be
equal to the $10.00 price per share. If a portion of the shares to satisfy the exercise of options under the stock-based benefit plans
is obtained from the issuance of authorized but unissued shares, our net income per share and stockholders' equity per share would
decrease. Assuming stockholder approval of the stock-based benefit plan and that shares of common stock used to fund stock options (equal
to 10% of the shares sold in the stock offering and contributed to the charitable foundation) are awarded through the use of authorized
but unissued shares of common stock, stockholders would have their ownership and voting interests diluted by approximately 9.09%.

(5) The retained earnings of Mercer Savings Bank will be substantially restricted after the conversion. See "Our Dividend Policy,"
 "The Conversion and Stock Offering – Liquidation Rights" and "Regulation and Supervision." The number of
shares used to calculate pro forma stockholders' equity per share is equal to the total number of shares to be outstanding upon
completion of the conversion and stock offering.

**COMPARISON OF VALUATION AND PRO FORMA**

**INFORMATION WITH AND WITHOUT THE**

**CHARITABLE FOUNDATION**

As reflected in the table below, at the minimum, midpoint, maximum, and adjusted maximum of the valuation range, our pro forma market capitalization is $11.6 million, $13.5 million, $15.5 million and $17.7 million, respectively, with the charitable foundation, compared to $11.1 million, $13.0 million, $15.0 million and $17.2 million, respectively, without the charitable foundation. There is no assurance that if the charitable foundation were not formed, the appraisal prepared at that time would conclude that our pro forma market value would be the same as that estimated in the table below. Any appraisal prepared at that time would be based on the facts and circumstances existing at that time, including, among other things, market and economic conditions.

For comparative purposes only, set forth below are certain pricing ratios, financial data and ratios at and for the three months ended December 31, 2022, at the minimum, midpoint, maximum, and adjusted maximum of the offering range, assuming the conversion and stock offering was completed at the beginning of the period, with and without the charitable foundation.

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| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Minimum of Offering Range** | **Minimum of Offering Range** | **Midpoint of Offering Range** | **Midpoint of Offering Range** | **Maximum of Offering Range** | **Maximum of Offering Range** | **Adjusted Maximum of Offering<br> Range** | **Adjusted Maximum of Offering<br> Range** |
|  | **With<br> Foundation** | **Without<br> Foundation** | **With<br> Foundation** | **Without<br> Foundation** | **With<br> Foundation** | **Without<br> Foundation** | **With<br> Foundation** | **Without<br> Foundation** |
|  | **(Dollars in thousands, except per share amounts)** | **(Dollars in thousands, except per share amounts)** | **(Dollars in thousands, except per share amounts)** | **(Dollars in thousands, except per share amounts)** | **(Dollars in thousands, except per share amounts)** | **(Dollars in thousands, except per share amounts)** | **(Dollars in thousands, except per share amounts)** | **(Dollars in thousands, except per share amounts)** |
| Estimated offering amount | $11050 | $11050 | $13000 | $13000 | $14950 | $14950 | $17193 | $17193 |
| Pro forma market capitalization | 11550 | 11050 | 13500 | 13000 | 15450 | 14950 | 17693 | 17193 |
| Pro forma total assets | 154130 | 154164 | 155846 | 155880 | 157562 | 157596 | 159536 | 159570 |
| Pro forma total liabilities | 131664 | 131716 | 131664 | 131664 | 131664 | 131664 | 131664 | 131664 |
| Pro forma stockholders' equity | 22466 | 22500 | 24182 | 24216 | 25898 | 25932 | 27872 | 27906 |
| Pro forma net income <sup>(1)</sup> | 1415 | 1430 | 1448 | 1463 | 1480 | 1497 | 1517 | 1543 |
| Pro forma stockholders' equity per share | $19.45 | $20.36 | $17.91 | $18.63 | $16.76 | $17.35 | $15.75 | $16.23 |
| Pro forma net income per share | $1.32 | $1.40 | $1.16 | $1.22 | $1.04 | $1.08 | $0.93 | $0.96 |
| **Pro forma pricing ratios:** |  |  |  |  |  |  |  |  |
| Offering price as a percentage of pro forma stockholders' equity per share | 51.40% | 49.10% | 55.80% | 53.70% | 59.70% | 57.60% | 63.50% | 61.60% |
| Offering price to pro forma net income per share | 7.58% | 7.14% | 8.62% | 8.20% | 9.62% | 9.26% | 10.75% | 10.42% |
| Offering price to pro forma assets per share | 7.50% | 7.20% | 8.70% | 8.30% | 9.80% | 9.50% | 11.10% | 10.80% |
| **Pro forma financial ratios:** |  |  |  |  |  |  |  |  |
| Return on assets | 0.92% | 0.93% | 0.93% | 0.94% | 0.94% | 0.95% | 0.95% | 0.96% |
| Return on equity | 6.30% | 6.36% | 5.99% | 6.04% | 5.71% | 5.77% | 5.44% | 5.50% |
| Equity to assets | 14.58% | 14.59% | 15.52% | 15.54% | 16.44% | 16.45% | 17.47% | 17.49% |

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*(footnote on following page)*

(1) The following table shows the estimated after-tax expense associated with the contribution to the charitable foundation, as well as
pro forma net income, pro forma net income per share, pro forma income on assets and pro forma income on stockholders' equity assuming
the contribution to the charitable foundation was expensed during the three months ended December 31, 2022 (dollars in thousands).

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| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Minimum of<br> Offering Range** |  | **Midpoint of<br> Offering Range** |  | **Maximum of<br> Offering Range** |  | **Adjusted Maximum of<br> Offering Range** |  |
| After-tax expense of stock and cash contribution to charitable foundation | $474 |  | $474 |  | $474 |  | $474 |  |
| Pro forma net income | $941 |  | $974 |  | $1006 |  | $1043 |  |
| Pro forma net income per share | $0.85 |  | $0.75 |  | $0.67 |  | $0.61 |  |
| Offering price to pro forma net income per share | 11.74 | x | 13.35 | x | 14.86 | x | 16.48 | x |
| Pro forma income as a percentage of assets | 0.61 | % | 0.62 | % | 0.65 | % | 0.66 | % |
| Pro forma income as a percentage of stockholders' equity | 50.2 | % | 54.7 | % | 58.7 | % | 62.7 | % |

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**MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS**

This discussion and analysis reflects our financial statements and other relevant statistical data, and is intended to enhance your understanding of our financial condition and results of operations. The information in this section has been derived from the financial statements, which appear beginning on page F-1 of this prospectus. You should read the information in this section in conjunction with the business and financial information regarding Mercer Bancorp provided in this prospectus.

**Overview**

After the completion of the conversion and stock offering, Mercer Bancorp will conduct its operations primarily through Mercer Savings Bank. We consider our primary market area for loan originations and deposit gathering to be Mercer and Darke Counties in western Ohio and contiguous areas, including Adams and Jay Counties in eastern Indiana. Mercer Savings Bank operates four branch offices in rural communities in western Ohio. We also intend to establish a fifth branch office during 2024 in Adams or Jay County in eastern Indiana, where we are an active lender. In addition to our branch network, we offer online and mobile banking.

Mercer Savings Bank's business consists primarily of taking deposits from the general public and investing those deposits, together with funds generated from operations and borrowings, in one- to four-family residential mortgage loans and agricultural real estate loans secured by properties located in our primary market area. To a lesser extent, we also originate multifamily real estate loans, commercial real estate loans, construction and land loans, home equity lines of credit, commercial and industrial loans, and consumer loans. We also invest in securities, which have historically consisted primarily of mortgage-backed securities and obligations issued by U.S. government sponsored enterprises, state and municipal securities. Following the conversion and stock offering, we intend to continue to seek to expand our residential real estate and agricultural real estate portfolios. Additionally, in January 2023, we began implementing an indirect automobile lending program. Our management team has experience with indirect automobile lending, and we intend to prudently grow that segment of the loan portfolio. We offer a variety of deposit accounts including checking accounts, savings accounts and certificates of deposit. Our primary source of funding is core deposits. We also utilize advances from the Federal Home Loan Bank of Cincinnati and brokered deposits for liquidity and asset/liability management purposes, and may attempt to attract municipal deposits to a lesser extent.

Our results of operations depend primarily on our net interest income. Net interest income is the difference between the interest income we earn on our interest-earning assets and the interest we pay on our interest-bearing liabilities. Our results of operations also are affected by our provisions for loan losses, non-interest income and non-interest expense. Non-interest income currently consists primarily of service charges on deposit accounts, gains on sales of loans, and income from bank owned life insurance. Non-interest expense currently consists primarily of expenses related to employee compensation and benefits, data processing expense, occupancy and equipment expense, check, ATM, credit card processing and network fees, director compensation and benefits, professional services fees, and other expenses.

Our results of operations may also be affected significantly by general and local economic and competitive conditions, changes in inflation, market interest rates, governmental policies and actions of regulatory authorities. Mercer Savings Bank is subject to comprehensive regulation and examination by the ODFI and the FDIC.

**Business Strategy**

Our principal objective is to build long-term value for our stockholders by operating a profitable community-oriented financial institution dedicated to meeting the banking needs of our customers. Highlights of our current business strategy include:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;·  ***Continue to focus on originating one- to four-family residential mortgage loans and agricultural real estate loans for retention in our loan portfolio.*** We are primarily a residential mortgage lender for borrowers in our primary market area. At December 31,
2022, $76.6 million, or 62.6% of our total loan portfolio, consisted of residential mortgage loans. Additionally, given the rural economy
of our market area, agricultural real estate loans also comprise a significant portion of our loan portfolio. At December 31, 2022,
$31.0 million, or 25.3% of our total loan portfolio, consisted of agricultural real estate loans. We have significant experience in these
areas and expect that residential mortgage and agricultural real estate lending will remain our primary lending activities following the
conversion and stock offering.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;·  ***Grow and diversify our loan portfolio prudently by implementing an indirect automobile lending program and enhance fee income through the pooling and sale of such loans*** . Although we intend to continue our historical focus on the origination of
 residential mortgage and agricultural real estate loans, in January 2023, we began implementing an indirect automobile lending
 program. We intend to prudently increase our originations of consumer automobile loans in order to diversify our loan portfolio,
 increase yield and manage interest rate risk. We also intend to pool and sell to investors some of the automobile loans that we
 originate to enhance fee income. We expect to originate indirect automobile loans from car dealerships located in western and
 southeastern Ohio and eastern Indiana.

Our management team has experience with indirect automobile lending. Our President and Chief Executive Officer, Barry Parmiter, previously oversaw a similar, successful program at another community bank in Ohio. Our Senior Vice President of Indirect Lending, Ryan Moorman, has five years' experience in indirect automobile lending, having led the development of an automobile dealership lending network at the same community bank in Ohio.

Indirect automobile loans have a different risk profile than one- to four-family residential mortgages and other types of loans. See "Risk Factors – Risks Related to Our Lending Activities – Our new indirect automobile lending program involves risks that could adversely affect our financial condition and results of operations" and "Business of Mercer Savings Bank – Loan Underwriting Risks."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;·  ***Maintain our strong asset quality through conservative loan underwriting.*** We intend to maintain strong asset quality
through what we believe are our conservative underwriting standards and credit monitoring processes. At December 31, 2022, our nonperforming
loans totaled $432,000, or 0.35% of total loans.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;·  ***Continue efforts to gain deposit market share and grow our low-cost "core" deposit base.*** We consider our
core deposits to include savings accounts, money market accounts, other savings deposits and checking accounts. Core deposits provide
a stable source of funds to support loan growth at costs consistent with improving our interest rate spread and net interest margin. We
will continue our efforts to increase our core deposits through customer service, products and services offered, and customer accessibility
via both traditional branches and digital platforms. Core deposits totaled $104.6 million, or 81.9% of total deposits, at December 31,
2022. &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;·  ***Expand our market area and access to customers through organic growth and de novo branching, while also considering opportunistic acquisitions.*** We intend to grow our balance sheet organically on a managed basis, and the capital we are raising in the stock
offering will enable us to increase our lending and investment capacity. In addition to organic growth, we may also consider expansion
opportunities in our market area or in contiguous markets that we believe would enhance both our franchise value and stockholder returns.
These opportunities may include establishing new ("de novo") branch offices or acquiring other financial institutions or branch
offices. The capital we are raising in the stock offering would help us fund any such opportunities that may arise. Specifically, we intend
to establish a fifth branch office during 2024 in Adams or Jay County in eastern Indiana, where we are an active lender. We believe this
de novo branch will expand our access to customers and core deposits in that part of our market area. We do not currently have any understandings
or agreements regarding any acquisitions.

We expect these strategies to guide our investment of the net proceeds of the stock offering. We intend to continue to pursue these business strategies after the conversion and stock offering, subject to changes necessitated by future market conditions, regulatory restrictions and other factors.

**Anticipated Increase in Noninterest Expense**

Following the completion of the conversion and stock offering, our noninterest expense is expected to increase because of the increased costs associated with operating as a public company, including the expected hiring of additional accounting and lending personnel, and the increased compensation expenses associated with the purchase of shares of common stock by our employee stock ownership plan and the possible implementation of a stock-based benefit plan, if approved by our stockholders, no earlier than six months after the completion of the conversion and stock offering. See "Summary – Benefits to Management and Potential Dilution to Stockholders Resulting from the Conversion and Stock Offering;" "Risk Factors – Risks Related to the Stock Offering – Our stock-based benefit plans will increase our expenses and reduce our income;" and "Management – Benefits to be Considered Following Completion of the Conversion and Stock Offering."

**Critical Accounting Policies**

The discussion and analysis of the financial condition and results of operations are based on our financial statements, which are prepared in conformity with generally accepted accounting principles used in the United States of America. The preparation of these financial statements requires management to make estimates and assumptions affecting the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and the reported amounts of income and expenses. We consider the accounting policies discussed below to be critical accounting policies. The estimates and assumptions that we use are based on historical experience and various other factors and are believed to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions, resulting in a change that could have a material impact on the carrying value of our assets and liabilities and our results of operations.

The Jumpstart Our Business Startups Act of 2012 (the "JOBS Act") contains provisions that, among other things, reduce certain reporting requirements for qualifying public companies. As an "emerging growth company" we may delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are made applicable to private companies. We intend to take advantage of the benefits of this extended transition period. Accordingly, our financial statements may not be comparable to companies that comply with such new or revised accounting standards.

The following represent our critical accounting policies:

***Allowance for Loan Losses.*** The allowance for loan losses is the estimated amount considered necessary to cover inherent, but unconfirmed, credit losses in the loan portfolio at the balance sheet date. The allowance is established through the provision for losses on loans which is charged against income. In determining the allowance for loan losses, management makes significant estimates and has identified this policy as one of our most critical accounting policies.

Management performs a quarterly evaluation of the allowance for loan losses. Consideration is given to a variety of factors in establishing this estimate including, but not limited to, current economic conditions, delinquency statistics, geographic and industry concentrations, the adequacy of the underlying collateral, the financial strength of the borrower, results of internal loan reviews and other relevant factors. This evaluation is inherently subjective as it requires material estimates that may be susceptible to significant change.

The analysis has two components, specific and general allowances. The specific percentage allowance is for unconfirmed losses related to loans that are determined to be impaired. Impairment is measured by determining the present value of expected future cash flows or, for collateral-dependent loans, the fair value of the collateral adjusted for market conditions and selling expenses. If the fair value of the loan is less than the loan's carrying value, a charge is recorded for the difference. The general allowance, which is for loans reviewed collectively, is determined by segregating the remaining loans by type of loan, risk weighting (if applicable) and payment history. We also analyze historical loss experience, delinquency trends, general economic conditions and geographic and industry concentrations. This analysis establishes historical loss percentages and qualitative factors that are applied to the loan groups to determine the amount of the allowance for loan losses necessary for loans that are reviewed collectively. The qualitative component is critical in determining the allowance for loan losses as certain trends may indicate the need for changes to the allowance for loan losses based on factors beyond the historical loss history. Not incorporating a qualitative component could misstate the allowance for loan losses. Actual loan losses may be significantly more than the allowances we have established which could result in a material negative effect on our financial results.

Our allowance for loan losses as a percent of total loans decreased from 0.83% at September 30, 2021 to 0.81% at September 30, 2022, which primarily reflects the impact of the growth in certain segments of our loan portfolio, as well as our consideration of the economic conditions affecting the qualitative factors used in the determination of the allowance for loan losses as they evolved over that period from the impact of inflationary pressures and economic conditions, among other considerations. From September 30, 2021 to September 30, 2022, changes to qualitative factors to reflect slowing growth trends in certain portfolio segments resulted in a decrease in the amount allocated for residential mortgages and commercial mortgages of $154,000 and $54,000, respectively. Increased risk related to trends in the levels of delinquencies for the same period only partially offset changes related to portfolio production.

A new credit loss accounting standard, the Current Expected Credit Loss standard ("CECL"), will become effective for Mercer Savings Bank on October 1, 2023. CECL requires financial institutions to determine periodic estimates of lifetime expected credit losses on loans and recognize the expected credit losses as allowances for credit losses. This will change the current method of providing allowances for loan losses that are incurred or probable, which may require us to increase our allowance for credit losses and will require us to greatly increase the types of data we need to collect and review to determine the appropriate level of the allowance for credit losses.

***Deferred Tax Assets.*** We use the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. Deferred tax assets are reduced by a valuation allowance when it is more likely than not that some portion of the deferred tax asset will not be realized. We exercise significant judgment in evaluating the amount and timing of recognition of the resulting tax liabilities and assets. These judgments require us to make projections of future taxable income. The judgments and estimates we make in determining our deferred tax assets, which are inherently subjective, are reviewed on a continual basis as regulatory and business factors change. Determining the proper valuation allowance for deferred taxes is critical in properly valuing the deferred tax asset and the related recognition of income tax expense or benefit. Any reduction in estimated future taxable income may require us to record a valuation allowance against our deferred tax assets.

***Fair Value Measurements***. The fair value of a financial instrument is defined as the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. Mercer Savings Bank estimates the fair value of a financial instrument and any related asset impairment using a variety of valuation methods. Where financial instruments are actively traded and have quoted market prices, quoted market prices are used for fair value. When the financial instruments are not actively traded, other observable market inputs, such as quoted prices of securities with similar characteristics, may be used, if available, to determine fair value. When observable market prices do not exist, Mercer Savings Bank estimates fair value. These estimates are subjective in nature and imprecision in estimating these factors can impact the amount of gain or loss recorded. A more detailed description of the fair values measured at each level of the fair value hierarchy and the methodology utilized by Mercer Savings Bank can be found in Note 12 of the Financial Statements, "Disclosures About Fair Value of Assets and Liabilities."

**Average Balance Sheets**

The following tables set forth average balance sheets, average yields and costs, and certain other information at the dates and for the periods indicated. No tax-equivalent yield adjustments have been made, as the effects would be immaterial. Average yields include the effect of net deferred fee income, discounts and premiums that are amortized or accreted to interest income or interest expense. Average balances are calculated using monthly average balances. Non-accrual loans are included in the computation of average balances only. Average loan balances include loans held for sale.

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| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | | **For the Three Months Ended December 31,** | **For the Three Months Ended December 31,** | **For the Three Months Ended December 31,** | **For the Three Months Ended December 31,** | **For the Three Months Ended December 31,** | **For the Three Months Ended December 31,** |
|  | **At<br> December 31.**<br>**2022** | **2022** | **2022** | **2022** | **2021** | **2021** | **2021** |
|  | **Weighted-<br> Average<br> Yield/Rate** | **Average<br> Outstanding<br> Balance** | **Interest** | **Average<br> Yield/Rate** | **Average<br> Outstanding<br> Balance** | **Interest** | **Average<br> Yield/Rate** |
|  | | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** |
| **Interest-earning assets:** |  |  |  |  |  |  |  |
| Loans (1) | 4.09% | $118826 | $1222 | 4.11% | $114461 | $1072 | 3.75% |
| Taxable securities | 1.51% | 10366 | 41 | 1.58% | 7644 | 14 | 0.73% |
| Tax-exempt securities | 2.83% | 4047 | 25 | 2.47% | 1881 | 9 | 1.91% |
| Interest-earning deposits and other | 4.18% | 10834 | 106 | 3.91% | 19713 | 11 | 0.22% |
| &nbsp;&nbsp;&nbsp;Total interest-earning assets | 3.87% | 144073 | 1394 | 3.87% | 143699 | 1106 | 3.08% |
| Noninterest-earning assets |  | 6193 |  |  | 6883 |  |  |
| Allowance for loan losses |  | (972) |  |  | (965) |  |  |
| &nbsp;&nbsp;&nbsp;Total assets |  | $149294 |  |  | $149617 |  |  |
| **Interest-bearing liabilities:** |  |  |  |  |  |  |  |
| Interest-bearing demand deposits | 0.05% | $44897 | 3 | 0.03% | $44408 | 4 | 0.04% |
| Savings deposits | 0.05% | 45272 | 8 | 0.07% | 42356 | 7 | 0.07% |
| Certificates of deposit | 0.78% | 24208 | 38 | 0.63% | 30078 | 53 | 0.70% |
| &nbsp;&nbsp;&nbsp;Total interest-bearing deposits | 0.20% | 114377 | 49 | 0.17% | 116842 | 64 | 0.22% |
| Federal Home Loan Bank advances | 0.95% | 3000 | 7 | 0.93% | 4000 | 9 | 0.90% |
| &nbsp;&nbsp;&nbsp;Total interest-bearing liabilities | 0.22% | 117377 | 56 | 0.19% | 120842 | 73 | 0.24% |
| Noninterest-bearing demand deposits |  | 16655 |  |  | 13453 |  |  |
| Other noninterest-bearing liabilities |  | 1094 |  |  | 1273 |  |  |
| &nbsp;&nbsp;&nbsp;Total liabilities |  | 135126 |  |  | 135568 |  |  |
| Equity |  | 14168 |  |  | 14049 |  |  |
| &nbsp;&nbsp;&nbsp;Total liabilities and equity |  | $149294 |  |  | $149617 |  |  |
| Net interest income |  |  | $1338 |  |  | $1033 |  |
| Net interest rate spread (2) | 3.65% |  |  | 3.68% |  |  | 2.84% |
| Net interest-earning assets (3) |  | $26696 |  |  | $22857 |  |  |
| Net interest margin (4) |  |  |  | 3.71% |  |  | 2.88% |
| Average interest-earning assets to interest-bearing liabilities |  | 122.74% |  |  | 118.91% |  |  |

---

*(footnotes on following page)*

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | | **For the Year Ended September 30,** | **For the Year Ended September 30,** | **For the Year Ended September 30,** | **For the Year Ended September 30,** | **For the Year Ended September 30,** | **For the Year Ended September 30,** |
|  | **At<br> September 30.**<br>**2022** | **2022** | **2022** | **2022** | **2021** | **2021** | **2021** |
|  | **Weighted-<br> Average<br> Yield/Rate** | **Average<br> Outstanding<br> Balance** | **Interest** | **Average<br> Yield/Rate** | **Average<br> Outstanding<br> Balance** | **Interest** | **Average<br> Yield/Rate** |
|  | | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** |
| **Interest-earning assets:** |  |  |  |  |  |  |  |
| Loans (1) | 3.94% | $114595 | $4322 | 3.77% | $110023 | $4343 | 3.95% |
| Taxable securities | 1.50% | 9190 | 67 | 0.73% | 5762 | 60 | 1.04% |
| Tax-exempt securities | 2.22% | 2548 | 53 | 2.08% | 1072 | 22 | 2.05% |
| Interest-earning deposits and other | 3.06% | 20266 | 153 | 0.75% | 23429 | 36 | 0.15% |
| &nbsp;&nbsp;&nbsp;Total interest-earning assets | 3.64% | 146599 | 4595 | 3.13% | 140286 | 4461 | 3.18% |
| Noninterest-earning assets |  | 6514 |  |  | 7311 |  |  |
| Allowance for loan losses |  | (977) |  |  | (904) |  |  |
| &nbsp;&nbsp;&nbsp;Total assets |  | $152136 |  |  | $146693 |  |  |
| **Interest-bearing liabilities:** |  |  |  |  |  |  |  |
| Interest-bearing demand deposits | 0.05% | $45854 | 14 | 0.03% | $41916 | 15 | 0.04% |
| Savings deposits | 0.05% | 44129 | 30 | 0.07% | 38427 | 32 | 0.08% |
| Certificates of deposit | 0.68% | 28181 | 189 | 0.67% | 32774 | 316 | 0.96% |
| &nbsp;&nbsp;&nbsp;Total interest-bearing deposits | 0.20% | 118164 | 233 | 0.20% | 113117 | 363 | 0.32% |
| Federal Home Loan Bank advances | 0.95% | 3462 | 32 | 0.92% | 4462 | 39 | 0.87% |
| &nbsp;&nbsp;&nbsp;Total interest-bearing liabilities | 0.22% | 121626 | 265 | 0.22% | 117579 | 402 | 0.34% |
| Noninterest-bearing demand deposits |  | 15540 |  |  | 14105 |  |  |
| Other noninterest-bearing liabilities |  | 1014 |  |  | 1260 |  |  |
| &nbsp;&nbsp;&nbsp;Total liabilities |  | 138180 |  |  | 132944 |  |  |
| Equity |  | 13956 |  |  | 13749 |  |  |
| &nbsp;&nbsp;&nbsp;Total liabilities and equity |  | $152136 |  |  | $146693 |  |  |
| Net interest income |  |  | $4330 |  |  | $4059 |  |
| Net interest rate spread (2) | 3.42% |  |  | 2.92% |  |  | 2.84% |
| Net interest-earning assets (3) |  | $24973 |  |  | $22707 |  |  |
| Net interest margin (4) |  |  |  | 2.95% |  |  | 2.89% |
| Average interest-earning assets to interest-bearing liabilities |  | 120.53% |  |  | 119.31% |  |  |

---

(1) Net deferred fee income included in interest earned on loans totaled $18,000 and $31,000 for the three months ended December 31,
2022 and 2021, respectively, and $110,000 and $157,000 for the year ended September 30, 2022 and 2021, respectively.

(2) Net interest rate spread represents the difference between the weighted average yield on interest-earning assets and the weighted
average rate of interest-bearing liabilities.

(3) Net interest-earning assets represent total interest-earning assets less total interest-bearing liabilities.

(4) Net interest margin represents net interest income divided by average total interest-earning assets.

**Rate/Volume Analysis**

The following table presents the effects of changing rates and volumes on our net interest income for the periods indicated. The rate column shows the effects attributable to changes in rate (changes in rate multiplied by prior volume). The volume column shows the effects attributable to changes in volume (changes in volume multiplied by prior rate). The total column represents the sum of the prior columns. For purposes of this table, changes attributable to both rate and volume, which cannot be segregated, have been allocated proportionately based on the changes due to rate and the changes due to volume. There were no out-of-period items or adjustments required to be excluded from the table below.

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Three Months Ended**<br> **December 31, 2022 vs. 2021** | **Three Months Ended**<br> **December 31, 2022 vs. 2021** | **Three Months Ended**<br> **December 31, 2022 vs. 2021** | **Year Ended**<br> **September 30, 2022 vs. 2021** | **Year Ended**<br> **September 30, 2022 vs. 2021** | **Year Ended**<br> **September 30, 2022 vs. 2021** |
|  | **Increase (Decrease) Due to** | **Increase (Decrease) Due to** | | **Increase (Decrease) Due to** | **Increase (Decrease) Due to** | |
|  | **Volume** | **Rate** | **Total<br> Increase**<br>**(Decrease)** | **Volume** | **Rate** | **Total<br> Increase**<br>**(Decrease)** |
|  | **(In thousands)** | **(In thousands)** | **(In thousands)** | **(In thousands)** | **(In thousands)** | **(In thousands)** |
| **Interest-earning assets:** |  |  |  |  |  |  |
| Loans | $42 | $108 | $150 | $176 | $(197) | $(21) |
| Taxable securities | 6 | 21 | 27 | 29 | (22) | 7 |
| Tax exempt-securities | 12 | 4 | 16 | 30 | 1 | 31 |
| Interest-earning deposits and other | (3) | 98 | 95 | (6) | 123 | 117 |
| &nbsp;&nbsp;&nbsp;Total interest-earning assets | 57 | 231 | 288 | 229 | (95) | 134 |
| **Interest-bearing liabilities:** |  |  |  |  |  |  |
| Interest-bearing demand deposits |  | (1) | (1) | 1 | (2) | (1) |
| Savings deposits | 1 |  | 1 | 5 | (7) | (2) |
| Certificates of deposit | (9) | (6) | (15) | (40) | (87) | (127) |
| &nbsp;&nbsp;&nbsp;Total interest-bearing deposits | (8) | (7) | (15) | (34) | (96) | (130) |
| Federal Home Loan Bank Advances | (2) | – | (2) | (9) | 2 | (7) |
| &nbsp;&nbsp;&nbsp;Total interest-bearing liabilities | (10) | (7) | (17) | (43) | (94) | (137) |
| Change in net interest income | $67 | $238 | $305 | $272 | $(1) | $271 |

---

**Comparison of Financial Condition at December 31, 2022 and September 30, 2022**

***Total Assets.*** Total assets were $146.2 million at December 31, 2022, a decrease of $6.7 million, or 4.4%, from $152.9 million at September 30, 2022. The decrease was primarily comprised of a decrease in cash and cash equivalents of $7.2 million, which was partially offset by an increase in investment securities available for sale of $749,000 and an increase in loans and loans held for sale of $441,000.

***Cash and Cash Equivalents.*** Cash and cash equivalents decreased by $7.2 million, or 49.9%, to $7.2 million at December 31, 2022 from $14.4 million at September 30, 2022. The decrease was due primarily to a decrease in deposits during the three-month period and the increase in investment securities and an increase in loans during the three months ended December 31, 2022.

***Investment Securities.*** Investment securities increased $728,000, or 5.7%, to $13.5 million at December 31, 2022, from $12.7 million at September 30, 2022. During the three-month period ended December 31, 2022, securities purchases of $1.3 million were partially offset by sales, calls, maturities and repayments of $700,000.

***Net Loans.*** Net loans increased by $160,000, or 0.1%, to $117.8 million at December 31, 2022 from $117.7 million at September 30, 2022. During the three months ended December 31, 2022, loan originations totaled $5.4 million, comprised primarily of $3.3 million secured by agricultural real estate, $908,000 of construction loans, $807,000 of loans secured by one- to four-family residential real estate and $299,000 of home equity line of credit loans.

During the three months ended December 31, 2022, agricultural real estate loans increased $2.5 million, or 8.7%, to a total of $31.0 million at December 31, 2022 and construction and land loans increased $618,000, or 17.1%, to $4.2 million at December 31, 2022, while residential real estate loans decreased $1.7 million, or 2.2%, to $76.6 million at December 31, 2022, from $78.3 million at September 30, 2022. Changes in loan balances reflect our strategic focus on originating one- to four-family residential mortgage loans and agricultural real estate loans amid strong competition for such loans in our market area.

***Deposits.*** Deposits decreased by $7.1 million, or 5.2%, to $127.7 million at December 31, 2022 from $134.8 million at September 30, 2022. Core deposits decreased $4.9 million, or 4.5%, to $104.6 million at December 31, 2022 from $109.5 million at September 30, 2022. Certificates of deposit decreased $2.2 million, or 8.6%, to $23.1 million at December 31, 2022 from $25.3 million at September 30, 2022. The decrease in certificates of deposit was primarily the result of an outflow of brokered deposits. The decrease in core deposits was due to migration to higher rate alternatives at investment brokerages, as well as normal seasonal declines in transactional accounts.

During the three months ended December 31, 2022, management continued its strategy of pursuing growth in demand accounts and other lower cost core deposits, in part by enhancing products and services offered and increased marketing. Management intends to continue its efforts to increase core deposits, with an emphasis on growth in consumer and business demand deposits, and may attempt to attract municipal deposits to a lesser extent. We anticipate a possible increase in the cost of deposits due to the current rising interest rate environment.

***Total Equity.*** Total equity increased $469,000, or 3.3%, to $14.5 million at December 31, 2022 from $14.1 million at September 30, 2022. The increase resulted from net income of $329,000 during the three months ended December 31, 2022 and a $141,000 increase in accumulated other comprehensive income.

**Comparison of Operating Results for the Three Months Ended December 31, 2022 and 2021**

***General.*** We recorded net income for the three months ended December 31, 2022 of $329,000, an increase of $149,000, or 83.2%, compared to net income of $179,000 for the three months ended December 31, 2021. The increase in net income was primarily due to a $305,000 increase in net interest income and a $15,000 decrease in the provision for loan losses, which were partially offset by a $61,000 decrease in noninterest income, an $84,000 increase in noninterest expenses and a $26,000 decrease in income taxes.

***Interest Income.*** Interest income increased $288,000, or 26.1%, to $1.4 million for the three months ended December 31, 2022, compared to the three months ended December 31, 2021. This increase was attributable to a $150,000, or 13.9%, increase in interest on loans, a $44,000, or 193.7%, increase in interest on investment securities and a $95,000, or 905.1%, increase in interest on interest-bearing deposits and other assets.

The average balance of loans increased by $4.4 million, or 3.8%, during the three months ended December 31, 2022 over the average balance for the three months ended December 31, 2021, while the average yield on loans increased by 36 basis points to 4.11% for the three months ended December 31, 2022 from 3.75% for the three months ended December 31, 2021. The increase in average yield on loans was due to the overall increase in interest rates in the economy.

The average balance of investment securities increased $4.9 million to $14.4 million for the three months ended December 31, 2022 from $9.5 million for the three months ended December 31, 2021, while the average yield on investment securities increased by 86 basis points to 1.83% for the three months ended December 31, 2022 from 0.97% for the three months ended December 31, 2021. The increase in average yields on securities was due primarily to the increasing interest rate environment.

The average balance of interest-earning deposits and other interest-earning assets, comprised primarily of certificates of deposit in other financial institutions, overnight deposits and stock in the Federal Home Loan Bank, decreased $8.9 million, or 45.0%, for the three months ended December 31, 2022, compared to the same period in 2021, which was partially offset by an increase in the average yield of 369 basis points, to 3.91% for the three months ended December 31, 2022 from 0.22% for the three months ended December 31, 2021. The increase in average yield reflected the increases in interest rates in the economy.

***Interest Expense.*** Total interest expense decreased $17,000, or 23.1%, to $56,000 for the three months ended December 31, 2022, from $73,000 for the three months ended December 31, 2021. The decrease was primarily due to a decrease of five basis points in the average cost of interest-bearing deposits to 0.17% for the three months ended December 31, 2022 from 0.22% for the three months ended December 31, 2021, and a decrease of $2.5 million, or 2.1%, in the average balance of interest-bearing deposits to $114.4 million for the three months ended December 31, 2022 from $116.8 million for the three months ended December 31, 2021.

Interest expense on borrowings decreased $2,000, or 20.6%, for the three months ended December 31, 2022, compared to the three months ended December 31, 2021. The decrease was due to a $1.0 million decrease in the average balance outstanding, to $3.0 million for the three months ended December 31, 2022 from $4.0 million for the same period in 2021, which was partially offset by a three basis point increase in the weighted-average rate, to 0.93% for the three months ended December 31, 2022.

***Net Interest Income*.** Net interest income increased $305,000, or 29.5%, to $1.3 million for the three months ended December 31, 2022, compared to $1.0 million for the three months ended December 31, 2021. The increase reflected an increase in the interest rate spread to 3.68% for the three months ended December 31, 2022 from 2.84% for the three months ended December 31, 2021 and an increase in average net interest earning assets of $3.8 million period to period. Our net interest margin increased to 3.71% for the three months ended December 31, 2022 from 2.88% for the three months ended December 31, 2021. The interest rate spread and net interest margin were impacted by a series of market interest rate increases during 2022.

***Provision for Loan Losses.*** Based on an analysis of the factors described in "Critical Accounting Policies—Allowance for Loan Losses," management concluded that a provision for loan losses was not required for the three months ended December 31, 2022, a decrease of $15,000 compared to the three months ended December 31, 2021. The allowance for loan losses was $961,000 and $973,000 at December 31, 2022 and 2021, respectively, and represented 0.79% of total loans at December 31, 2022, and 0.84% of total loans at December 31, 2021. The determination regarding the adequacy of the allowance for loan losses was due primarily to the low balances of nonperforming loans, delinquent loans and net charge-offs in both periods.

Total nonperforming loans were $432,000 at December 31, 2022, compared to $213,000 at December 31, 2021. Classified loans totaled $793,000 at December 31, 2022, compared to $213,000 at December 31, 2021, and total loans past due greater than 30 days were $1.4 million and $821,000 at those respective dates. As a percentage of nonperforming loans, the allowance for loan losses was 222.5% at December 31, 2022 compared to 926.7% at December 31, 2021.

The allowance for loan losses reflects the estimate management believes to be appropriate to cover incurred probable losses which were inherent in the loan portfolio at December 31, 2022 and 2021. While management believes the estimates and assumptions used in the determination of the adequacy of the allowance are reasonable, such estimates and assumptions could be proven incorrect in the future, and the actual amount of future provisions may exceed the amount of past provisions, and the increase in future provisions that may be required may adversely impact Mercer Savings Bank's financial condition and results of operations. In addition, bank regulatory agencies periodically review the allowance for loan losses and may require an increase in the provision for possible loan losses or the recognition of loan charge-offs, based on judgments different than those of management.

***Non-Interest Income****.* Non-interest income totaled $127,000 for the three months ended December 31, 2022, a decrease of $61,000, or 32.4%, from $188,000 for the three months ended December 31, 2021. The decrease was primarily due to a $36,000, decrease in gain on sale of loans, a $14,000 decrease in loan servicing fees and an $8,000 loss on sale of investment securities in the 2022 quarter. We had no loan sales during the three months ended December 31, 2022 as the increase in interest rates had the effect of reducing origination of fixed-rate loans that we sell in the secondary market.

***Noninterest Expense.*** Noninterest expense increased $84,000, or 8.6%, to $1.1 million for the three months ended December 31, 2022, compared to the three months ended December 31, 2021. The increase was due primarily to a $31,000, or 6.1%, increase in salaries and employee benefits, a $28,000, or 33.5%, increase in occupancy and equipment and a $22,000, or 20.6%, increase in data processing fees. The increase in salaries and employee benefits was due primarily to an increase in the profit-sharing allocation as a result of the increase in net income, along with normal merit increases period-to-period. The increase in occupancy and equipment was due primarily to expenses associated with installation of new data processing hardware and software. The increase in data processing was due to an extensive information technology network upgrade and the engagement of an independent firm for managed services.

Noninterest expense can be expected to increase because of costs associated with operating as a public company and increased compensation costs related to possible implementation of one or more stock-based benefit plans, if approved by our stockholders.

***Income Taxes.*** Income taxes increased by $26,000, or 51.9%, for the three months ended December 31, 2022, compared to $50,000 for the three months ended December 31, 2021. The increase in the income tax provision was due primarily to a $175,000, or 76.4%, increase in pretax income. The effective tax rates were 18.9% and 21.9% for the three months ended December 31, 2022 and 2021, respectively.

**Comparison of Financial Condition at September 30, 2022 and 2021**

***Total Assets.*** Total assets were $152.9 million at September 30, 2022, an increase of $5.5 million, or 3.8%, over $147.3 million at September 30, 2021. The increase was primarily comprised of an increase in loans of $5.2 million and an increase in investment securities of $3.9 million, which were partially offset by a decrease in cash and cash equivalents of $3.6 million.

***Cash and Cash Equivalents.*** Cash and cash equivalents decreased by $3.6 million, or 20.1%, to $14.4 million at September 30, 2022 from $18.0 million at September 30, 2021. The decrease was due to excess liquidity being used to fund origination of loans and purchases of investment securities.

***Investment Securities.*** Investment securities increased $3.9 million, or 43.5%, to $12.8 million at September 30, 2022 from $8.9 million at September 30, 2021. U.S. Government agency securities increased by $1.8 million, or 90.4%, to $3.8 million at September 30, 2022; municipal securities increased by $1.9 million to $3.1 million at September 30, 2022. Aggregate securities purchases of $6.4 million during the year ended September 30, 2022 were partially offset by calls, maturities and repayments of $1.2 million and a decrease in the fair value of securities available for sale of $1.2 million.

The yield on our investment securities decreased to 1.02% for the year ended September 30, 2022 from 1.20% for the year ended September 30, 2021, as a result of the maturity of securities during the period and the low interest rate environment prevalent during much of the period.

***Net Loans.*** Net loans increased by $5.2 million, or 4.6%, to $117.7 million at September 30, 2022 from $112.5 million at September 30, 2021. During the year ended September 30, 2022, loan originations totaled $37.9 million, comprised primarily of $20.2 million of loans secured by one- to four-family residential real estate, $10.8 million secured by agricultural real estate and $3.1 million of construction loans.

During the year ended September 30, 2022, residential real estate loans increased $4.5 million, or 6.1%, to $78.3 million at September 30, 2022, from $73.8 million at September 30, 2021 and agricultural real estate loans increased $1.2 million, or 4.5%, to a total of $28.5 million at September 30, 2022. Increases in loan balances reflect our strategic focus on originating one- to four-family residential mortgage loans and agricultural real estate loans amid strong competition for such loans in our market area.

***Deposits.*** Deposits increased by $6.5 million, or 5.1%, to $134.8 million at September 30, 2022 from $128.2 million at September 30, 2021. Core deposits increased $11.8 million, or 12.1%, to $109.5 million at September 30, 2022 from $97.7 million at September 30, 2021. Certificates of deposit decreased $5.3 million, or 17.4%, to $25.3 million at September 30, 2022 from $30.6 million at September 30, 2021.

During the year ended September 30, 2022, management continued its strategy of pursuing growth in demand accounts and other lower cost core deposits, in part by enhancing products and services offered, and increased marketing. Management intends to continue its efforts to increase core deposits, with an emphasis on growth in consumer and business demand deposits, and may attempt to attract municipal deposits to a lesser extent.

***Total Equity.*** Total equity decreased $6,000, or 0.05%, to $14.0 million at September 30, 2022 compared to September 30, 2021. The increase resulted from net income of $944,000 during the year ended September 30, 2022, which was substantially offset by a $950,000 decrease in accumulated other comprehensive income.

**Comparison of Operating Results for the Years Ended September 30, 2022 and 2021**

***General.*** Net income for the year ended September 30, 2022 was $944,000, an increase of $372,000, or 65.2%, compared to $571,000 for the year ended September 30, 2021. The increase in net income was primarily due to a $271,000 increase in net interest income, a $155,000 decrease in the provision for loan losses and a $138,000 increase in noninterest income, which were partially offset by a $141,000 increase in noninterest expenses and a $50,000 increase in income taxes.

***Interest Income.*** Interest income increased $134,000, or 3.0%, to $4.6 million for the year ended September 30, 2022 from $4.5 million for the year ended September 30, 2021. This increase was attributable to a $117,000, or 328.1%, increase in interest on interest-bearing deposits and other assets and a $38,000, or 46.3%, increase in interest on investment securities, which were partially offset by a $21,000, or 0.5%, decrease in interest on loans receivable.

The average balance of loans during the year ended September 30, 2022 increased by $4.6 million, or 4.2%, from the balance for the year ended September 30, 2021, while the average yield on loans decreased by 18 basis points to 3.77% for the year ended September 30, 2022 from 3.95% for the year ended September 30, 2021. The decrease in average yield on loans reflects the declining interest rate environment that prevailed until the midpoint of fiscal 2022. While interest rates began to increase during our 2022 fiscal year, the interest rates on our adjustable rate loans do not react immediately to such increases, but should increase provided the higher interest rate environment persists.

The average balance of investment securities increased $4.9 million to $11.7 million for the year ended September 30, 2022 from $6.8 million for the year ended September 30, 2021, while the average yield on investment securities decreased by 18 basis points to 1.02% for the year ended September 30, 2022 from 1.20% for the year ended September 30, 2021. Interest income on interest-earning deposits and other interest-earning assets, comprised primarily of certificates of deposit in other financial institutions, overnight deposits and stock in the Federal Home Loan Bank, increased $117,000, or 328.1%, for the year ended September 30, 2022 , due to an increase in the average yield of 60 basis points, to 0.75% for the year ended September 30, 2022 from 0.15% for the year ended September 30, 2021, partially offset by a decrease in the average balance of $3.2 million. The increase in average yield was due to the increase in interest rates in the overall economy during the periods.

***Interest Expense.*** Total interest expense decreased $137,000, or 34.0%, to $265,000 for the year ended September 30, 2022 from $401,000 for the year ended September 30, 2021. Interest expense on deposits decreased $130,000, or 35.8%, due primarily to a decrease of 12 basis points in the average cost of deposits to 0.20% for the year ended September 30, 2022 from 0.32% for the year ended September 30, 2021, which was partially offset by an increase of $5.0 million, or 4.5%, in the average balance of interest-bearing deposits to $118.2 million for the year ended September 30, 2022 from $113.1 million for the year ended September 30, 2021.

Interest expense on borrowings decreased $7,000, or 17.0%, for the year ended September 30, 2022, compared to the year ended September 30, 2021. The decrease was due to a $1.0 million decrease in the average balance outstanding, to $3.5 million for the year ended September 30, 2022 from $4.5 million for the year ended September 30, 2021, which was partially offset by a five basis point increase in the weighted-average rate, to 0.92% for the year ended September 30, 2022.

***Net Interest Income*.** Net interest income increased $271,000, or 6.7%, to $4.3 million for the year ended September 30, 2022 compared to $4.1 million for the year ended September 30, 2021. The increase reflected an increase in the interest rate spread to 2.92% for the year ended September 30, 2022 from 2.84% for the year ended September 30, 2021, while the average net interest earning assets increased $6.3 million year to year. Our net interest margin increased to 2.95% for the year ended September 30, 2022 from 2.89% for the year ended September 30, 2021.

***Provision for Loan Losses.*** Based on an analysis of the factors described in "Critical Accounting Policies—Allowance for Loan Losses," management recorded a provision for loan losses $25,000 the year ended September 30, 2022, a decrease of $155,000, or 86.1 % from the $180,000 provision recorded for the year ended September 30, 2021. The larger provision for loan losses recorded during fiscal 2021 reflected management's assessment of the risk to our loan portfolio represented by the Covid-19 pandemic. The allowance for loan losses was $984,000 at September 30, 2022 and $958,000 at September 30, 2021 and represented 0.81% of total loans at September 30, 2022, and 0.83% of total loans at September 30, 2021. The determination regarding the adequacy of the allowance for loan losses was due primarily to the low balances of nonperforming loans, delinquent loans and no net charge-offs in both periods.

Total nonperforming loans were $350,000 at September 30, 2022, compared to $213,000 at September 30, 2021. Classified loans totaled $350,000 at September 30, 2022, compared to $213,000 at September 30, 2021, and total loans past due greater than 30 days were $830,000 and $821,000 at those respective dates. As a percentage of nonperforming loans, the allowance for loan losses was 281.1% at September 30, 2022 compared to 449.8% at September 30, 2021.

The allowance for loan losses reflects the estimate management believes to be appropriate to cover incurred probable losses which were inherent in the loan portfolio at September 30, 2022 and 2021. While management believes the estimates and assumptions used in the determination of the adequacy of the allowance are reasonable, such estimates and assumptions could be proven incorrect in the future, and the actual amount of future provisions may exceed the amount of past provisions, and the increase in future provisions that may be required may adversely impact Mercer Savings Bank's financial condition and results of operations. In addition, bank regulatory agencies periodically review the allowance for loan losses and may require an increase in the provision for possible loan losses or the recognition of loan charge-offs, based on judgments different than those of management.

***Non-Interest Income****.* Non-interest income totaled $794,000 for the year ended September 30, 2022, an increase of $138,000, or 21.0%, from $656,000 for the year ended September 30, 2021. The increase was due primarily to a $169,000 life insurance death benefit payout, which was partially offset by a $47,000, or 47.3%, decrease in gains on sales of loans. The decrease in gain on sale of loans was due to an $835,000, or 25.0%, decrease in the volume of loans sold year-to-year, as a result of the increase in market interest rates during the year ended September 30, 2022.

***Noninterest Expense.*** Noninterest expense increased $141,000, or 3.7%, to $4.0 million for the year ended September 30, 2022, compared to the year ended September 30, 2021. The increase was due primarily to a $151,000, or 7.8%, increase in salaries and employee benefits and a $27,000, or 6.4%, increase in data processing fees, which were partially offset by a $36,000, or 31.7%, decrease in loan expenses and a $35,000 decrease in loss on sale of foreclosed real estate. The increase in salaries and employee benefits was due primarily to an increase in the profit-sharing allocation as a result of the increase in net income, a decline in deferred loan origination costs attributable to a decline in loan origination volume, and normal merit increases year-to-year. The increase in data processing was due to an extensive information technology network upgrade and the engagement of an independent firm for managed services.

Noninterest expense can be expected to increase because of costs associated with operating as a public company and increased compensation costs related to possible implementation of one or more stock-based benefit plans, if approved by our stockholders. Management also anticipates an increase in noninterest expense due to the economic environment and wage pressures.

***Income Taxes.*** Income taxes increased by $50,000, or 35.2%, to $193,000 for the year ended September 30, 2022, compared to $143,000 for the year ended September 30, 2021. The increase in the income tax provision was due primarily to a $423,000, or 59.2% increase in pretax income. The effective tax rates were 17.0% and 20.0% for the years ended September 30, 2022 and 2021, respectively. The fiscal 2022 effective tax rate reflected the effects of nontaxable income items included in pretax income.

**Management of Market Risk**

***General*.** Our most significant form of market risk is interest rate risk because, as a financial institution, the majority of our assets and liabilities are sensitive to changes in interest rates. Therefore, a principal part of our operations is to manage interest rate risk and limit the exposure of our financial condition and results of operations to changes in market interest rates. All directors participate in discussions during the regular board meetings evaluating the interest rate risk inherent in our assets and liabilities, and the level of risk that is appropriate. These discussions take into consideration our business strategy, operating environment, capital, liquidity and performance objectives consistent with the policy and guidelines approved by them.

Our asset/liability management strategy attempts to manage the impact of changes in interest rates on net interest income, our primary source of earnings. Among the techniques we are using to manage interest rate risk are:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· maintaining capital levels that exceed the thresholds for well-capitalized status under federal regulations;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· maintaining a high level of liquidity;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· growing our volume of core deposit accounts;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· managing our investment securities portfolio so as to reduce the average maturity and effective life of the portfolio;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· selling certain conforming, fixed-rate residential mortgages with longer terms upon origination, subject to market conditions and
periodic review of our asset/liability management needs; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· continuing to diversify our loan portfolio by adding indirect automobile loans, which typically have higher yields and shorter maturities.

By following these strategies, we believe that we are better positioned to react to increases and decreases in market interest rates.

We have not engaged in hedging activities, such as engaging in futures or options. We do not anticipate entering into similar transactions in the future.

***Economic Value of Equity*.** We compute amounts by which the net present value of our assets and liabilities (economic value of equity or "EVE") would change in the event of a range of assumed changes in market interest rates. This model uses a discounted cash flow analysis and an option-based pricing approach to measure the interest rate sensitivity of net portfolio value. The model estimates the economic value of each type of asset, liability and off-balance sheet contract under the assumptions that the United States Treasury yield curve increases instantaneously by 100, 200 and 300 basis point increments or decreases instantaneously by 100, 200 and 300 basis point increments, with changes in interest rates representing immediate and permanent, parallel shifts in the yield curve.

The following table sets forth, at December 31, 2022, the calculation of the estimated changes in our EVE that would result from the designated immediate changes in the United States Treasury yield curve.

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **At December 31, 2022** | **At December 31, 2022** | **At December 31, 2022** | **At December 31, 2022** | **At December 31, 2022** | **At December 31, 2022** |
| | | | | **EVE as a Percentage of Present<br> Value of Assets <sup>(3)</sup>** | **EVE as a Percentage of Present<br> Value of Assets <sup>(3)</sup>** |
| | | **Estimated Increase (Decrease) in EVE** | **Estimated Increase (Decrease) in EVE** | | |
|<br>**Change in Interest**<br>**Rates (basis points)<sup>(1)</sup>** |<br>**Estimated**<br>**EVE <sup>(2)</sup>** | **Amount** | **Percent** |<br>**EVE Ratio <sup>(4)</sup>** | **Increase<br> (Decrease)**<br>**(basis points)** |
| **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** |
| 300 | $32543 | $(10123) | (23.73)% | 23.33% | (726) |
| 200 | 36828 | (5838) | (13.68)% | 26.41% | (418) |
| 100 | 39812 | (2854) | (6.69)% | 28.55% | (204) |
|  | 42666 |  |  | 30.59% |  |
| (100) | 41828 | (838) | (1.96)% | 29.99% | (60) |
| (200) | 38606 | (4060) | (9.52)% | 27.68% | (291) |
| (300) | 32078 | (10588) | (24.82)% | 23.00% | (759) |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Assumes an immediate uniform change in interest rates at all maturities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) EVE is the discounted present value of expected cash flows from assets, liabilities and off-balance sheet contracts.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Present value of assets represents the discounted present value of incoming cash flows on interest-earning assets.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) EVE Ratio represents EVE divided by the present value of assets.

The table above indicates that at December 31, 2022, we would have experienced a 13.68% decrease in EVE in the event of an instantaneous parallel 200 basis point increase in market interest rates and a 9.52% decrease in EVE in the event of an instantaneous 200 basis point decrease in market interest rates.

The following table sets forth, at September 30, 2022, the calculation of the estimated changes in our EVE that would result from the designated immediate changes in the United States Treasury yield curve.

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **At September 30, 2022** | **At September 30, 2022** | **At September 30, 2022** | **At September 30, 2022** | **At September 30, 2022** | **At September 30, 2022** |
| | | | | **EVE as a Percentage of Present<br> Value of Assets <sup>(3)</sup>** | **EVE as a Percentage of Present<br> Value of Assets <sup>(3)</sup>** |
| | | **Estimated Increase (Decrease) in EVE** | **Estimated Increase (Decrease) in EVE** | | |
|<br>**Change in Interest**<br>**Rates (basis points) <sup>(1)</sup>** |<br>**Estimated**<br>**EVE <sup>(2)</sup>** | **Amount** | **Percent** |<br>**EVE Ratio <sup>(4)</sup>** | **Increase<br> (Decrease)**<br>**(basis points)** |
| **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** |
| 300 | $33692 | $(9885) | (22.68)% | 23.29% | (683) |
| 200 | 37884 | (5693) | (13.06)% | 26.18% | (394) |
| 100 | 40731 | (2846) | (6.53)% | 28.15% | (197) |
|  | 43577 |  |  | 30.12% |  |
| (100) | 42586 | (991) | (2.27)% | 29.43% | (69) |
| (200) | 41222 | (2355) | (5.40)% | 28.49% | (163) |
| (300) | 32155 | (11422) | (26.21)% | 22.23% | (789) |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Assumes an immediate uniform change in interest rates at all maturities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) EVE is the discounted present value of expected cash flows from assets, liabilities and off-balance sheet contracts.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Present value of assets represents the discounted present value of incoming cash flows on interest-earning assets.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) EVE Ratio represents EVE divided by the present value of assets.

The table above indicates that at September 30, 2022, we would have experienced a 13.06% decrease in EVE in the event of an instantaneous parallel 200 basis point increase in market interest rates and a 5.40% decrease in EVE in the event of an instantaneous 200 basis point decrease in market interest rates. As of September 30, 2021, we would have experienced a 48.50% decrease in EVE in the event of an instantaneous parallel 200 basis point increase in market interest rates and a 0.90% increase in EVE in the event of an instantaneous 200 basis point decrease in market interest rates.

***Change in Net Interest Income.*** We also analyze our sensitivity to changes in interest rates through a net interest income model. Net interest income is the difference between the interest income we earn on our interest-earning assets, such as loans and securities, and the interest we pay on our interest-bearing liabilities, such as deposits and borrowings. We estimate what our net interest income would be for a 12-month period. We then calculate what the net interest income would be for the same period under the assumptions that the United States Treasury yield curve increases instantaneously by up to 300 basis points or decreases instantaneously by up to 300 basis points, with changes in interest rates representing immediate and permanent, parallel shifts in the yield curve. A basis point equals one-hundredth of one percent, and 100 basis points equals one percent. An increase in interest rates from 3% to 4% would mean, for example, a 100 basis point increase in the "Change in Interest Rates" column below.

The following table sets forth, at December 31, 2022, the calculation of the estimated changes in our net interest income ("NII") that would result from the designated immediate changes in the United States Treasury yield curve.

---

| | | |
|:---|:---|:---|
| **At December 31, 2022** | **At December 31, 2022** | **At December 31, 2022** |
| **Change in Interest Rates<br> (basis points) <sup>(1)</sup>** | **NII Year 1 Forecast** | **Year 1 Change from Level** |
| | **(Dollars in thousands)** | |
| +300 | $5275 | (2.33)% |
| +200 | 5308 | (1.72)% |
| +100 | 5334 | (1.24)% |
| Level | 5401 |  |
| (100) | 5414 | 0.24% |
| (200) | 5630 | 4.24% |
| (300) | 5513 | 2.03% |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Assumes an immediate uniform change in interest rates at all maturities.

The table above indicates that at December 31, 2022, we would have experienced a 1.72% decrease in NII in the event of an instantaneous parallel 200 basis point increase in market interest rates and a 4.24% increase in NII in the event of an instantaneous 200 basis point decrease in market interest rates.

The following table sets forth, at September 30, 2022, the calculation of the estimated changes in our NII that would result from the designated immediate changes in the United States Treasury yield curve.

---

| | | |
|:---|:---|:---|
| **At September 30, 2022** | **At September 30, 2022** | **At September 30, 2022** |
| **Change in Interest Rates<br> (basis points) <sup>(1)</sup>** | **NII Year 1 Forecast** | **Year 1 Change from Level** |
| | **(Dollars in thousands)** | |
| +300 | $5233 | (2.08)% |
| +200 | 5273 | (1.33)% |
| +100 | 5293 | (0.95)% |
| Level | 5344 |  |
| (100) | 5192 | (2.84)% |
| (200) | 5287 | (1.07)% |
| (300) | 5232 | (2.14)% |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Assumes an instantaneous uniform
change in interest rates at all maturities.

The table above indicates that at September 30, 2022, we would have experienced a 1.33% decrease in NII in the event of an instantaneous parallel 200 basis point increase in market interest rates and a 1.07% decrease in NII in the event of an instantaneous 200 basis point decrease in market interest rates. As of September 30, 2021, we would have experienced a 17.30% increase in NII in the event of an instantaneous parallel 200 basis point increase in market interest rates and a 1.20% increase in NII in the event of an instantaneous 200 basis point decrease in market interest rates.

Certain shortcomings are inherent in the methodologies used in the above interest rate risk measurement. Modeling changes in EVE and NII require making certain assumptions that may or may not reflect the manner in which actual yields and costs respond to changes in market interest rates. For instance, the EVE and NII tables presented above assume that the composition of our interest-sensitive assets and liabilities existing at the beginning of a period remains constant over the period being measured and assumes that a particular change in interest rates is reflected uniformly across the yield curve regardless of the duration or repricing of specific assets and liabilities. However, the shape of the yield curve changes constantly and the value and pricing of our assets and liabilities, including our deposits, may not closely correlate with changes in market interest rates. Accordingly, although the EVE and NII tables may provide an indication of our interest rate risk exposure at a particular point in time and in the context of a particular yield curve, such measurements are not intended to and do not provide a precise forecast of the effect of changes in market interest rates on EVE and NII and will differ from actual results.

EVE and net interest NII calculations also may not reflect the fair values of financial instruments. For example, decreases in market interest rates can increase the fair values of our loans, deposits and borrowings.

**Liquidity and Capital Resources**

Liquidity describes our ability to meet the financial obligations that arise in the ordinary course of business. Liquidity is primarily needed to meet the borrowing and deposit withdrawal requirements of our customers and to fund current and planned expenditures. Our primary sources of funds are deposits, principal and interest payments on loans and securities, and proceeds from maturities of securities. We also have the ability to borrow from the Federal Home Loan Bank of Cincinnati. At December 31, 2022, we had $3.0 million of outstanding borrowings from the Federal Home Loan Bank of Cincinnati. At December 31, 2022, we had the capacity to borrow $53.9 million from the Federal Home Loan Bank of Cincinnati. At December 31, 2022, September 30 2022 and 2021, the Bank had a cash management line of credit agreement with the FHLB providing for additional borrowing of $10.0 million.

While maturities and scheduled amortization of loans and securities are predictable sources of funds, deposit flows and loan prepayments are greatly influenced by general interest rates, economic conditions, and competition. Our most liquid assets are cash and short-term investments. The levels of these assets are dependent on our operating, financing, lending, and investing activities during any given period.

Our cash flows are comprised of three primary classifications: cash flows from operating activities, cash flows from investing activities, and cash flows from financing activities. For further information, see the statements of cash flows contained in the financial statements beginning on page F-1 of this prospectus.

We are committed to maintaining a strong liquidity position. We monitor our liquidity position on a daily basis. We anticipate that we will have sufficient funds to meet our current funding commitments. Based on our deposit retention experience and current pricing strategy, we anticipate that a significant portion of maturing time deposits will be retained.

At December 31, 2022, Mercer Savings Bank exceeded all regulatory capital levels required to be considered "well capitalized." For further information, see Note 9 of the notes to the financial statements beginning on page F-1 of this prospectus.

***Off-Balance Sheet Arrangements.*** At December 31, 2022, we had $13.1 million of outstanding commitments to originate loans, $3.2 million of which represents the balance of remaining funds to be disbursed on construction loans in process. Certificates of deposit that are scheduled to mature in less than one year from December 31, 2022 totaled $14.5 million at December 31, 2022. Management expects that a substantial portion of the maturing certificates of deposit will be renewed. However, if a substantial portion of these deposits is not retained, we may utilize Federal Home Loan Bank of Cincinnati advances or raise interest rates on deposits to attract new accounts, which may result in higher levels of interest expense.

**Recent Accounting Pronouncements**

For a discussion of the impact of recent accounting pronouncements, see Note 1 of the notes to our financial statements beginning on page F-1 of this prospectus.

**Impact of Inflation and Changing Prices**

The financial statements and related data presented in this prospectus have been prepared according to GAAP which require the measurement of financial position and operating results in terms of historical dollars without considering changes in the relative purchasing power of money over time due to inflation. The primary impact of inflation on our operations is reflected in increased operating costs. Unlike most industrial companies, virtually all of the assets and liabilities of a financial institution are monetary in nature. As a result, interest rates, generally, have a more significant impact on a financial institution's performance than does inflation. Interest rates do not necessarily move in the same direction or to the same extent as the prices of goods and services.

**BUSINESS OF MERCER BANCORP**

Mercer Bancorp was incorporated in the State of Maryland on March 7, 2023, and has not engaged in any business to date. Upon completion of the conversion and stock offering, Mercer Bancorp will own all of the issued and outstanding stock of Mercer Savings Bank. We intend to contribute at least 50% of the net proceeds from the stock offering to Mercer Savings Bank. Mercer Bancorp will retain the remainder of the net proceeds from the stock offering and use a portion of the retained net proceeds to make a loan to the employee stock ownership plan and contribute $100,000 in cash to the charitable foundation. At a later date, we may use the net proceeds to repurchase shares of common stock, subject to our capital needs, regulatory limitations and other factors. We will invest our initial capital as discussed in "How We Intend to Use the Proceeds from the Stock Offering."

After the completion of the conversion and stock offering, Mercer Bancorp, as the bank holding company of Mercer Savings Bank, will be authorized to pursue other business activities permitted by applicable laws and regulations. See "Regulation and Supervision – Holding Company Regulation" for a discussion of the activities that are permitted for bank holding companies.

Following the conversion and stock offering, our cash flow will depend on earnings from the investment of the net proceeds from the stock offering that we retain, and any dividends we receive from Mercer Savings Bank. Mercer Savings Bank is subject to regulatory limitations on the amount of dividends that it may pay. See "Regulation and Supervision." Initially, Mercer Bancorp will neither own nor lease any property, but will instead pay a fee to Mercer Savings Bank for the use of its premises, equipment and furniture. At the present time, we intend to employ only persons who are officers of Mercer Savings Bank to serve as officers of Mercer Bancorp. However, we will use periodically the support staff of Mercer Savings Bank. We will pay a fee to Mercer Savings Bank for the time employees of Mercer Savings Bank devote to Mercer Bancorp; however, these individuals will not be separately compensated by Mercer Bancorp. Mercer Bancorp may hire additional employees, as appropriate, to the extent it expands its business in the future.

**BUSINESS OF MERCER SAVINGS BANK**

**General**

We consider our primary market area for loan originations and deposit gathering to be Mercer and Darke Counties in western Ohio and contiguous areas, including Adams and Jay Counties in eastern Indiana. We conduct our business through four branch offices in rural communities in western Ohio. We also intend to establish a fifth branch office during 2024 in Adams or Jay County in eastern Indiana, where we are an active lender. In addition to our branch network, we offer online and mobile banking.

Our loan portfolio consists primarily of residential mortgage loans secured by one- to four-family residential properties and agricultural real estate loans secured by farmland located in our primary market area. To a lesser extent, we also originate multifamily real estate loans, commercial real estate loans, construction and land loans, home equity lines of credit, commercial and industrial loans, and consumer loans. We generally retain the loans that we originate in our portfolio. However, in recent years, we have attempted to sell conforming, fixed-rate residential mortgages with longer terms upon origination, with servicing rights retained, to help limit our interest rate risk exposure and generate fee income. Following the conversion and stock offering, we intend to continue to seek to expand our residential real estate and agricultural real estate portfolios. Additionally, in January 2023, we began implementing an indirect automobile lending program. Our management has experience with indirect automobile lending and we intend to prudently grow that segment of the loan portfolio. We also invest in securities, which have historically consisted primarily of mortgage-backed securities and obligations issued by U.S. government sponsored enterprises, state and municipal securities. We offer a variety of deposit accounts including checking accounts, savings accounts and certificates of deposit. Our primary source of funding is core deposits. However, we also utilize advances from the Federal Home Loan Bank of Cincinnati and brokered deposits for liquidity and asset/liability management purposes, and may attempt to attract municipal deposits to a lesser extent. We are subject to comprehensive regulation and examination by the ODFI and the FDIC.

In February 2022, we hired our current President and Chief Executive Officer, Barry Parmiter, who has 25 years of experience in community bank leadership in Ohio. Since that time, our board of directors and management have conducted an extensive review of our business strategy, operations, and our information technology systems and other third-party service providers. In July 2022, consistent with our strategy to implement an indirect automobile lending program, we hired a Senior Vice President of Indirect Lending, Ryan Moorman. We are also currently seeking to hire up to three additional lending and underwriting staff.

Our main office is located at 1100 Irmscher Blvd, Celina, Ohio 45822, and our telephone number at that address is (419) 586-5158. Our website address is *www.mercersavings.com*. Information on our website is not incorporated into this prospectus and should not be considered part of this prospectus.

**Market Area**

We consider our primary market area for loan originations and deposit gathering to be Mercer and Darke Counties, which are located in central-western Ohio along the border of Indiana, and contiguous areas, including Adams and Jay Counties in eastern Indiana. Currently, all of our branch offices are located in Mercer and Darke Counties in Ohio. We have two branch offices in Celina, Ohio, which is the county seat of Mercer County, as well as one office in Fort Recovery, Ohio, and one office in Greenville, Ohio, which is the county seat of adjacent Darke County. Celina, Ohio is located approximately 80 miles north of Dayton, Ohio and 50 miles southeast of Fort Wayne, Indiana. In addition to our branch network, we offer online and mobile banking.

Our market area is primarily rural, with a number of smaller population centers located throughout the region. The local economy consists largely of agricultural activities, with a cross-section of other economic sectors, including healthcare services, manufacturing, construction and transportation, with a concentration of small businesses. Darke County is one of the top agricultural producers in Ohio. Agricultural activities include the farming of soybeans, corn and wheat and production of poultry, eggs and pork. As is typical of more rural areas, non-agricultural employment includes a somewhat higher proportion of manufacturing-based employment. Major employers in Mercer County include agriculture services providers, Celina Aluminum Precision Technology (a Honda supplier), and other manufacturers, as well as printing, insurance and trucking service providers. Major employers in Darke County include the Whirlpool Corporation (appliances), Midmark Corporation (health equipment), Greenville Technology, Inc. (automobile parts) and FRAM Group (oil filters). In Indiana, our market area has a concentration of religious communities traditionally focused on family farming activities as well as furniture-making. In Adams County in particular, the Swiss-Amish community comprises approximately 25% of the population. Outside of agriculture, employers in Adams and Jay Counties include boat manufacturers, healthcare providers, and fiberglass and metal works.

According to published statistics, the 2023 estimated population of Mercer and Darke Counties is 51,300 and 42,500, respectively. Additionally, the 2023 estimated population of Adams and Jay Counties is 36,000 and 20,000, respectively. The 2023 to 2028 estimated population growth rate is 0.1% for Mercer County and a decline of 0.2% for Darke County, compared to projected growth of 0.1% statewide and 0.4% nationwide. The 2023 to 2028 estimated population growth rate is 0.4% for Adams County and a decline of 0.3% for Jay County. Estimated 2023 median household income is $76,032 for Mercer County and $64,462 for Darke County, compared to $66,042 statewide and $73,503 nationwide. Estimated 2023 median household income is $62,480 for Adams County and $53,658 for Jay County. The 2023 to 2028 estimated median household income growth rate is 2.2% for Mercer County and 1.9% for Darke County, compared to 2.1% statewide and 2.5% nationwide. The 2023 to 2028 estimated median household income growth rate is 2.2% for Adams County and 2.4% for Jay County. Estimated 2023 per capita income is $35,789 for Mercer County and $33,132 for Darke County, compared to $37,654 statewide and $41,287 nationwide. Estimated 2023 per capita income is $30,155 for Adams County and $29,625 for Jay County. The 2023 to 2028 estimated per capita income growth rate is 2.5% for Mercer County and 2.5% for Darke County, compared to 2.6% statewide and 2.6% nationwide. The 2023 to 2028 estimated per capita income growth rate is 2.6% for Adams County and 2.2% for Jay County. The December 2022 unemployment rate for Mercer County was 2.1% and 3.1% for Darke County, compared to 3.6% statewide and 3.3% nationwide. The December 2022 unemployment rate for Mercer County was 2.1% and 3.1% for Darke County, compared to 3.6% statewide and 3.3% nationwide.

We intend to expand our geographic footprint and establish a fifth branch office during 2024 in Adams or Jay County in eastern Indiana, where we are an active lender. We believe this branch location will expand our access to customers and core deposits in that part of our market area.

**Competition**

We face strong competition within our primary market area both in making loans and attracting retail deposits. Our market area includes large money center and regional banks, community banks and savings institutions, and credit unions. We also face competition for loans from mortgage banking firms, consumer finance companies, credit unions, and fintech companies and, with respect to deposits, from money market funds, brokerage firms, mutual funds and insurance companies. At June 30, 2022 (the most recent date for which FDIC data is publicly available), we were ranked third among the nine FDIC-insured financial institutions with offices in Mercer County, with a market share of deposits of 6.61%, and eleventh among the 12 FDIC-insured financial institutions with offices in Darke County, with a market share of deposits of 1.68%.

**Impact of COVID-19 Pandemic**

The COVID-19 pandemic caused significant economic dislocation in the United States. In response to the pandemic, state governments, including Ohio, took preventative or protective actions, such as imposing restrictions on travel and business operations, advising or requiring individuals to limit or forego time outside of their homes, and ordering temporary closures of businesses that have been deemed to be non-essential. These measures increased unemployment in the United States and negatively impacted many businesses.

We did not participate in the Paycheck Protection Program administered by the U.S. Small Business Administration. However, in order to assist residential mortgage loan borrowers experiencing financial hardship as a result of the COVID-19 pandemic, we offered short-term payment deferrals of principal and interest. At December 31, 2022, there were no loans that remained on deferral status.

Given the continued uncertainty and evolving economic effects and impact of the COVID-19 pandemic, any future direct and indirect impacts on our business, results of operations and financial condition remain uncertain. See "Risk Factors – Risks Related to Strategic and Operational Matters – Public health emergencies, like the COVID-19 pandemic, could adversely affect our financial condition and results of operations."

**Lending Activities**

***General.*** Our loan portfolio consists primarily of residential mortgage loans secured by one- to four-family residential properties in our primary market area, including Mercer and Darke Counties in Ohio and Adams and Jay Counties in Indiana. At December 31, 2022, one- to four-family residential mortgages represented 62.6% of our total loan portfolio. We offer both adjustable-rate and fixed-rate residential mortgage loans. However, historically, a significant majority of the residential real estate loans which we have originated are long-term, fixed-rate loans that generally conform to secondary market guidelines. We generally retain the loans that we originate in our portfolio. However, in recent years, we have attempted to sell conforming, fixed-rate residential mortgages with longer terms upon origination, with servicing rights retained, to help limit our interest rate risk exposure and generate fee income. We also have significant experience in originating agricultural real estate loans secured by farmland. At December 31, 2022, agricultural real estate loans represented 25.3% of our total loan portfolio. To a lesser extent, we also originate multifamily real estate loans, commercial real estate loans, construction and land loans, home equity lines of credit, commercial and industrial loans, and consumer loans. Following the conversion and stock offering, we expect that residential real estate and agricultural real estate lending will continue to be our primary focus and areas of growth. Additionally, in January 2023, we began implementing an indirect automobile lending program. Our management team has experience with indirect automobile lending and we intend to prudently grow that segment of our loan portfolio.

***Loan Portfolio Composition.*** The following table sets forth the composition of our loan portfolio by type of loan at the dates indicated. Loan balances exclude loans held for sale, which totaled $282,000, $0 and $399,000 at December 31, 2022, September 30, 2022 and September 30, 2021, respectively.

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | | | **At September 30,** | **At September 30,** | **At September 30,** | **At September 30,** |
|  | **At December 31, 2022** | **At December 31, 2022** | **2022** | **2022** | **2021** | **2021** |
|  | **Amount** | **Percent** | **Amount** | **Percent** | **Amount** | **Percent** |
|  | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** |
| Real estate loans: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;One- to four-family | $76582 | 62.6% | $78312 | 64.4% | $73808 | 64.2% |
| &nbsp;&nbsp;&nbsp;Multifamily | 1346 | 1.1 | 1356 | 1.1 | 1173 | 1 |
| &nbsp;&nbsp;&nbsp;Agricultural | 30987 | 25.3 | 28516 | 23.5 | 27290 | 23.7 |
| &nbsp;&nbsp;&nbsp;Commercial | 1780 | 1.5 | 1790 | 1.5 | 1792 | 1.6 |
| &nbsp;&nbsp;&nbsp;Construction and land | 4228 | 3.5 | 3610 | 3 | 3631 | 3.2 |
| &nbsp;&nbsp;&nbsp;Home equity lines of credit | 4716 | 3.9 | 5175 | 4.3 | 4220 | 3.7 |
| Commercial and industrial loans | 1767 | 1.4 | 1833 | 1.5 | 2170 | 1.9 |
| Consumer loans | 868 | 0.7 | 926 | 0.8 | 921 | 0.8 |
| &nbsp;&nbsp;&nbsp;Total | 122274 | 100.0% | 121518 | 100.0% | 115005 | 100.0% |
| Less: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Undisbursed loans in process | 3151 |  | 2530 |  | 1202 |  |
| &nbsp;&nbsp;&nbsp;Net deferred loan fees | 332 |  | 334 |  | 334 |  |
| &nbsp;&nbsp;&nbsp;Allowance for loan losses | 961 |  | 984 |  | 958 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loans, net | $117830 |  | $117670 |  | $112511 |  |

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***Contractual Maturities.*** The following tables set forth the contractual maturities of our total loan portfolio at December 31, 2022. Demand loans, loans having no stated repayment schedule or maturity, and overdraft loans are reported as being due in one year or less. The tables present contractual maturities and do not reflect repricing or the effect of prepayments. Actual maturities may differ.

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **One- to four-<br> family** | **Multifamily** | **Agricultural** | **Commercial real estate** |
|  | **(In thousands)** | **(In thousands)** | **(In thousands)** | **(In thousands)** |
| Amounts due in: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;One year or less | $4 | $– | $– | $– |
| &nbsp;&nbsp;&nbsp;After one through five years | 803 |  | 8 | 561 |
| &nbsp;&nbsp;&nbsp;After five through 15 years | 24720 | 168 | 1667 | 428 |
| &nbsp;&nbsp;&nbsp;More than 15 years | 51055 | 1178 | 29312 | 791 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total | $76582 | $1346 | $30987 | $1780 |

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Construction and<br> land** | **Home equity lines of credit** | **Commercial and<br> Industrial** | **Consumer** | **Total** |
|  | **(In thousands)** | **(In thousands)** | **(In thousands)** | **(In thousands)** | **(In thousands)** |
| Amounts due in: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;One year or less | $875 | $234 | $125 | $175 | $1413 |
| &nbsp;&nbsp;&nbsp;After one through five years | 33 | 387 | 165 | 601 | 2558 |
| &nbsp;&nbsp;&nbsp;After five through 15 years | 1600 | 4052 | 1477 | 92 | 34204 |
| &nbsp;&nbsp;&nbsp;More than 15 years | 1720 | 43 | – | – | 84099 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total | $4228 | $4716 | $1767 | $868 | $122274 |

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The following table sets forth our fixed and adjustable rate loans at December 31, 2022 that are contractually due after December 31, 2023.

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| | | | |
|:---|:---|:---|:---|
|  | **Due After December 31, 2023** | **Due After December 31, 2023** | **Due After December 31, 2023** |
|  | **Fixed** | **Adjustable** | **Total** |
|  | **(In thousands)** | **(In thousands)** | **(In thousands)** |
| Real estate loans: |  |  |  |
| &nbsp;&nbsp;&nbsp;One- to four-family | $43003 | $33575 | $76578 |
| &nbsp;&nbsp;&nbsp;Multifamily | 1165 | 181 | 1346 |
| &nbsp;&nbsp;&nbsp;Agricultural | 2704 | 28283 | 30987 |
| &nbsp;&nbsp;&nbsp;Construction | 3077 | 276 | 3353 |
| &nbsp;&nbsp;&nbsp;Commercial | 668 | 1112 | 1780 |
| &nbsp;&nbsp;&nbsp;Home equity lines of credit |  | 4482 | 4482 |
| Commercial and industrial loans | 885 | 757 | 1642 |
| Consumer loans | 693 | – | 693 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total | $52195 | $68666 | $120861 |

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***Residential Mortgage Lending*.** At December 31, 2022, we had $76.6 million of loans secured by one- to four-family residential real estate, representing 62.6% of total loans. Our one- to four-family residential real estate loans are generally secured by owner-occupied properties located in our primary market area. At December 31, 2022, $7.5 million, or 9.8% of residential mortgage loans, were secured by non-owner occupied properties. At December 31, 2022, we held the first lien position for $71.9 million, or 93.9%, of our one- to four-family residential loans and a junior lien position for $4.7 million, or 6.1%, of our one- to four-family residential loans. At December 31, 2022, our largest residential mortgage loan had an outstanding balance of $621,000 and was performing according to its original terms. The average principal loan balance of our one- to four-family residential real estate loans was $100,000 at December 31, 2022.

Our one- to four-family residential real estate loans are generally underwritten to secondary market guidelines. We generally retain the one- to four-family residential real estate loans that we originate. However, in recent years, we have attempted to sell conforming, fixed-rate residential mortgages with longer terms upon origination, with servicing rights retained, to help limit our interest rate risk exposure and generate fee income. We generally limit the loan-to-value ratios of our one- to four-family residential real estate loans to 80% of the purchase price or appraised value, whichever is lower. In addition, we may make one- to four-family residential real estate loans with loan-to-value ratios between 80% and 97% of the purchase price or appraised value, whichever is less, where the borrower obtains private mortgage insurance. We offer both fixed-rate and adjustable rate residential mortgage loans for terms up to 30 years, though one- to four-family residential real estate loans often remain outstanding for shorter periods than their contractual terms because borrowers have the right to refinance or prepay their loans. Adjustable rate mortgages are tied to 1 Year Treasury Bill Rate. For adjustable rate loans, the interest rate will be fixed for an initial term of three, five or seven years and then adjusts annually thereafter. In recent years, our loans have a maximum annual rate increase cap of 2.00%, a lifetime rate increase cap of 6.00% and a floor between 3.50% and 4.75%.

Although adjustable-rate mortgage loans may reduce to an extent our vulnerability to changes in market interest rates because they periodically re-price, as interest rates increase the required payments due from the borrower also increase (subject to rate caps), increasing the potential for default by the borrower. At the same time, the ability of the borrower to repay the loan and the marketability of the underlying collateral may be adversely affected by higher interest rates. Upward adjustments of the contractual interest rate are also limited by our maximum periodic and lifetime rate adjustments. Moreover, many of our adjustable rate loans have an initial period where the interest rate is fixed. As a result, the effectiveness of adjustable-rate mortgage loans in compensating for changes in market interest rates generally may be limited.

We do not offer "interest only" residential mortgage loans, where the borrower pays interest for an initial period, after which the loan converts to a fully amortizing loan. We also do not offer loans that provide for negative amortization of principal, such as "Option ARM" loans, where the borrower can pay less than the interest owed on the loan, resulting in an increased principal balance during the life of the loan. We do not currently offer "subprime loans" on one- to four-family residential real estate loans (i.e., generally loans to borrowers with credit scores less than 620).

***Agricultural Real Estate Loans*.** At December 31, 2022, we had $31.0 million in agricultural real estate loans, representing 25.3% of total loans. These loans are generally secured by owner-occupied farmland located in our primary market area. At December 31, 2022, our largest agricultural real estate loan had an outstanding balance of $1.5 million and was secured by farmland. At December 31, 2022, this loan was performing according to its original terms.

We offer both fixed-rate and adjustable rate loans for agricultural real estate. The significant majority of our agricultural real estate loans are adjustable rate loans with the interest rate tied to the 1 Year Treasury Bill Rate. Agricultural real estate loans generally have terms up to 20 or 30 years. The interest rate on an adjustable rate loan will be fixed for an initial term of three or five years and then adjusts yearly thereafter. We generally limit the loan-to-value ratios of our agricultural real estate loans to 80% of the purchase price or appraised value, whichever is lower.

We consider a number of factors in originating agricultural real estate loans. We evaluate the qualifications and financial condition of the borrower, including credit history, profitability and expertise, as well as the value and condition of the property securing the loan. When evaluating the qualifications of the borrower, we consider the financial resources of the borrower, the borrower's experience in agriculture and the borrower's payment history with us and other financial institutions. In evaluating the property securing the loan, the factors we consider include the net operating income of the mortgaged property before debt service and depreciation, the ratio of the loan amount to the appraised value of the mortgaged property, and the debt service coverage ratio (the ratio of net operating income to debt service). Generally, we require that the debt service coverage ratio be at least 1.25x. The significant majority of our agricultural real estate loans are appraised by outside independent appraisers approved by the board of directors. Personal guarantees are generally obtained from the principals of agricultural real estate borrowers. An environmental phase one report is obtained when the possibility exists that hazardous materials may have existed on the site, or the site may have been impacted by adjoining properties that handled hazardous materials.

Loans secured by agricultural real estate and commercial real estate generally have larger balances and involve a greater degree of risk than one- to four-family residential real estate loans. The primary concern in agricultural and commercial real estate lending is the borrower's creditworthiness and the feasibility and cash flow potential of the underlying business. Payments on loans secured by income producing properties often depend on successful operation and management of the properties. As a result, repayment of such loans may be subject, to a greater extent than residential real estate loans, to adverse conditions in the real estate market or the economy. To monitor cash flows on income properties, we require borrowers and loan guarantors to provide annual financial statements, depending on the size of the loan.

If we foreclose on an agricultural real estate loan, the marketing and liquidation period to convert the real estate asset to cash can be lengthy with substantial holding costs. In addition, deferred maintenance, repairs and market stigma can result in prospective buyers expecting sale price concessions to offset their real or perceived economic losses for the time it takes them to return the property to profitability. Depending on the individual circumstances, initial charge-offs and subsequent losses on agricultural real estate loans can be unpredictable and substantial.

***Indirect Automobile and Other Consumer Loans*.** At December 31, 2022, consumer loans were $868,000, or 0.70% of total loans. Our consumer loans are primarily secured by motor vehicles. Consumer loans may have fixed or adjustable interest rates and terms up to seven years, depending on the type of collateral and creditworthiness of the borrower, with loan-to-value ratios up to 110%.

In January 2023, we began implementing an indirect automobile lending program and intend to prudently grow this segment of our loan portfolio. Automobile loans generally have higher yields than one to-four family real estate loans and shorter maturities, which can help manage interest rate risk. In addition, management believes that offering consumer loan products helps to expand and create stronger ties to our existing customer base by increasing the number of customer relationships and providing cross-marketing opportunities. We also intend to pool and sell to investors some of the automobile loans that we originate to enhance fee income. Our management team has previous experience with indirect automobile lending, as our President and Chief Executive Officer, Barry Parmiter, previously oversaw a similar, successful program during his tenure at Community Savings, Caldwell, Ohio, a former community bank in our region. Additionally, our Senior Vice President of Indirect Lending, Ryan Moorman, has five years' experience in indirect automobile lending, having led the development of an automobile dealership network at Community Savings.

We expect to originate indirect automobile loans from car dealerships located in western and southeastern Ohio and eastern Indiana under an arrangement where the dealer receives a fee for referring the loan to us. Each dealer will submit credit applications directly to us. Dealerships will be subject to financial, BBB, public records, and online business ratings review, and we will periodically review the quality of the loans we accept from dealerships and track individual dealership performance. In determining whether to accept a loan from a dealership, the borrower's creditworthiness is the most significant criterion, and we will consider factors such as the borrower's employment history, indebtedness, a credit report, and other factors that bear on creditworthiness.

Automobile loans are generally secured by automobiles. Our indirect automobile loans have fixed interest rates and terms up to seven years, with loan-to-value ratios up to 110% in order to cover purchase expenses such as sales tax, dealer preparation fees, license fees and title fees in addition to the purchase price of the vehicle. A vehicle's value is determined by using one of the standard reference sources for dealers of used cars.

Generally, automobile loans have greater risk of loss or default than one- to four-family residential real estate loans. These loans are typically secured by automobiles, which depreciate rapidly in value. We face the risk that any collateral recovered for a defaulted loan may not provide an adequate source of repayment of the outstanding loan balance. As a result, consumer loan collections are dependent on the borrower's continuing financial stability and thus are more likely to be adversely affected by job loss, divorce, illness or personal bankruptcy. We will attempt to address collateral-related risks by lending primarily on new and late-model used vehicles. However, the application of various federal and state laws, including bankruptcy and insolvency laws, may also limit our ability to recover on such loans. Additionally, in originating indirect automobile loans, we rely on the dealerships in our network and assume the risk of unsatisfactory origination programs, including any noncompliance with federal, state and local laws. We also rely on the dealerships to ensure that our security interest in the financed vehicles is perfected.

***Construction and Land Loans.*** At December 31, 2022, we had $4.2 million in construction and land loans, representing 3.5% of our total loan portfolio. We make residential construction loans primarily to individuals for the construction of their primary residences and to contractors and builders of single-family homes. We generally do not make speculative residential construction loans, which are construction loans to a builder where there is not a contract in place for the purchase of the home at the time the construction loan is originated, although we may consider such loans. Our residential construction loans are underwritten to the same guidelines as permanent residential mortgage loans. We also make a limited amount of land loans to complement our construction lending activities, as such loans are generally secured by lots that will be used for residential development. At December 31, 2022, our largest construction loan had an outstanding balance of $652,000 and was secured by a single-family residential property. At December 31, 2022, this loan was performing according to its original terms.

We may also make commercial construction loans, which are underwritten to the same guidelines as commercial mortgage loans. At December 31, 2022, we had four commercial construction loans, primarily secured by agricultural real estate, with an aggregate balance of $542,000.

Our construction loans are based upon estimates of costs and values associated with the completed project. Underwriting is focused on the borrowers' financial strength, credit history and demonstrated ability to produce a quality product and effectively market and manage their operations. Before making a commitment to fund a construction loan, we require an appraisal of the property by an independent licensed appraiser. We also generally require inspections of the property before disbursements of funds during the term of the construction loan.

Construction lending involves additional risks when compared with permanent lending because funds are advanced upon the security of the project, which is of uncertain value before its completion. Because of the uncertainties inherent in estimating construction costs, as well as the market value of the completed project and the effects of governmental regulation of real property, it is relatively difficult to evaluate accurately the total funds required to complete a project and the related loan-to-value ratio. In addition, generally during the term of a construction loan, interest may be funded by the borrower or disbursed from an interest reserve set aside from the construction loan budget. These loans often involve the disbursement of substantial funds with repayment substantially dependent on the success of the ultimate project and the ability of the borrower to sell or lease the property or obtain permanent take-out financing, rather than the ability of the borrower or guarantor to repay principal and interest. If the appraised value of a completed project proves to be overstated, we may have inadequate security for the repayment of the loan upon completion of construction of the project and may incur a loss. Land loans have substantially similar risks.

***Multifamily and Commercial Real Estate Loans*.** Historically, we have not emphasized commercial real estate and multifamily lending, as our market area does not provide significant opportunities for the origination of these types of loans. At December 31, 2022, we had $1.3 million in multifamily real estate loans, representing 1.1% of our total loans, and $1.8 million in commercial real estate loans, representing 1.5% of total loans. Our multifamily real estate loans are generally secured by properties with five or more residential units located in our primary market area. Our commercial real estate loans are generally secured primarily by owner-occupied properties in our primary market area, including retail store fronts and a golf course. At December 31, 2022, our largest multifamily real estate loan had an outstanding balance of $996,000 and our largest commercial real estate loan had an outstanding balance of $743,000. At December 31, 2022, these loans were performing in accordance with their original terms.

Loans secured by multifamily and commercial real estate generally have larger balances and involve a greater degree of risk than one- to four-family residential real estate loans. The primary concern in multifamily and commercial real estate lending is the borrower's creditworthiness and the feasibility and cash flow potential of the underlying property and business. Payments on loans secured by income producing properties often depend on successful operation and management of the properties. As a result, repayment of such loans may be subject, to a greater extent than residential real estate loans, to adverse conditions in the real estate market or the economy. To monitor cash flows on income properties, we require borrowers and loan guarantors to provide annual financial statements, depending on the size of the loan.

If we foreclose on a multifamily or commercial real estate loan, the marketing and liquidation period to convert the real estate asset to cash can be lengthy with substantial holding costs. In addition, vacancies, deferred maintenance, repairs and market stigma can result in prospective buyers expecting sale price concessions to offset their real or perceived economic losses for the time it takes them to return the property to profitability. Depending on the individual circumstances, initial charge-offs and subsequent losses on multifamily and commercial real estate loans can be unpredictable and substantial.

***Home Equity Lines of Credit.*** We offer home equity lines of credit, which are generally made for owner-occupied homes, and are secured by first or second mortgages on residences. At December 31, 2022, the outstanding balance of home equity lines of credit was $4.7 million, or 3.9% of total loans. We currently offer home equity lines of credit with a draw period of 10 years and a repayment period of 10 years, and generally at rates tied to the U.S. Prime Rate as published in *The Wall Street Journal*. The loan to value ratio is generally up to 90% if we have the first lien on the collateral property, or 80% if we do not. Our home equity loans and lines of credit are generally underwritten in the same manner as our one- to four-family residential loans.

Home equity lines of credit generally carry greater credit risk than one- to four family residential real estate loans secured by first mortgages. Our interest is generally subordinated to the interest of the institution holding the first mortgage. Even where we hold the first mortgage, we face the risk that the value of the collateral may not be sufficient to compensate us for the amount of the unpaid loan and costs of foreclosure and we may be unsuccessful in recovering the remaining balance from those customers.

***Commercial and Industrial Loans.*** Historically, we have not emphasized commercial business lending. At December 31, 2022, commercial and industrial loans were $1.8 million, or 1.4% of total loans. Our commercial and industrial loans include both term loans and lines of credit made with either fixed or adjustable interest rates. Depending on the collateral used to secure the loans, commercial loans are made in amounts of up to 70% of the value of the collateral securing the loan. At December 31, 2022, our commercial business loans also included a $617,000 participation in a pool of loans made to healthcare providers through Bankers Healthcare Group.

Unlike residential real estate loans, which generally are made on the basis of the borrower's ability to make repayment from their employment or other income, and which are secured by real property whose value tends to be more easily ascertainable, commercial and industrial loans are of higher risk and typically are made on the basis of the borrower's ability to make repayment from the cash flows of the borrower's business, and the collateral securing these loans may fluctuate in value. Our commercial and industrial loans are originated primarily based on the identified cash flows of the borrower and secondarily on the underlying collateral provided by the borrower. Credit support provided by the borrower for most of these loans is based on the liquidation of the pledged collateral and enforcement of a personal guarantee, if any. Further, any collateral securing such loans may depreciate over time, may be difficult to appraise and may fluctuate in value. As a result, the availability of funds for the repayment of commercial and industrial loans may depend substantially on the success of the business itself.

**Loan Originations, Purchases and Sales**

We originate loans through employee marketing and advertising efforts, our existing customer base, walk-in customers and referrals from customers. Additionally, we expect that our indirect automobile loans will be generated from car dealerships in western and southeastern Ohio and eastern Indiana.

We generally retain the loans that we originate in our portfolio. However, in recent years, we have attempted to sell conforming, fixed-rate residential mortgages with longer terms upon origination, with servicing rights retained, to help limit our interest rate risk exposure and generate fee income. During the years ended September 30, 2022 and 2021, we sold one- to four-family residential real estate loans of $2.5 million and $3.3 million, respectively, and recorded gains on sale of loans of $52,600 and $99,800, respectively. We also intend to pool and sell to investors some of the indirect automobile loans that we originate to enhance fee income.

We generally do not purchase loans, except for an occasional participation interest in a loan originated by another financial institution acting as the lead lender. At December 31, 2022, our largest purchased participation interest had an outstanding balance of $278,000, representing a 68% participation interest in a $450,000 commercial real estate loan secured by farmland. At December 31, 2022, this loan was performing according to its original terms. Additionally, at December 31, 2022 we had a $617,000 participation in a pool of commercial business loans made to healthcare providers through Bankers Healthcare Group.

**Loan Approval Procedures and Authority**

Our lending is subject to written, non-discriminatory underwriting standards and origination procedures. Decisions on loan applications are made on the basis of detailed applications submitted by the prospective borrower and property valuations. Our policies require that for all real estate loans that we originate, property valuations must be performed by outside independent state-licensed appraisers approved by our board of directors. The loan applications are designed primarily to determine the borrower's ability to repay the requested loan, and the more significant items on the application are verified through use of credit reports, financial statements and tax returns.

By law, the aggregate amount of loans that we are permitted to make to any one borrower or a group of related borrowers is generally limited to 15% of Mercer Savings Bank's unimpaired capital and surplus. For us, this limit was $2.4 million as of December 31, 2022. Such limit may be increased to 25% if the amount in excess of 15% is secured by "readily marketable collateral" or 30% for certain residential development loans. At December 31, 2022, our largest credit relationship with one borrower consisted of three loans with an aggregate outstanding balance of $1.5 million, secured by farmland. At December 31, 2022, these loans were performing according to their original terms.

Designated loan officers may approve secured, consumer non-real estate loans up to $25,000. Loans up to $300,000 may be approved by our Senior Vice President of Operations and loans up to $500,000 may be approved by our Senior Vice President of Lending or President and Chief Executive Officer. Loans in excess of those amounts require the approval of three of the following individuals: the President and Chief Executive Officer, the Senior Vice President of Lending, the Senior Vice President of Operations, and any director.

Generally, we require property and extended coverage casualty insurance in amounts at least equal to the principal amount of the loan or the value of improvements on the property, depending on the type of loan. In addition, we require an escrow for flood insurance (where appropriate). For residential mortgage loans exceeding an 80% loan-to-value ratio, we require private mortgage insurance in amounts intended to reduce our exposure to 80% or less. A significant portion of our agricultural real estate loans are made to family farms within religious communities, which have formal self-insurance arrangements rather than traditional commercial insurance. Automobiles must be insured against loss or damage by fire, theft and collision.

**Delinquencies, Classified Assets and Nonperforming Assets**

***Delinquency Procedures.*** When a borrower fails to make a required monthly payment on a loan, we mail a notice to the borrower and attempt to contact the borrower by phone. All delinquent loans are reported to the board of directors each month. After 90 days delinquent the loan is transferred to the appropriate collections personnel. Our policies provide that a late notice be sent each month that the loan is past due. In addition, we may call the borrower when the loan is 15 days past due, and we attempt to cooperate with the borrower to determine the reason for nonpayment and to work with the borrower to establish a repayment schedule that will cure the delinquency. Once the loan is considered in default, generally at 90 days past due, a letter is generally sent to the borrower explaining that the entire balance of the loan is due and payable, the loan is placed on non-accrual status, and additional efforts are made to contact the borrower. If the borrower does not respond, we generally initiate foreclosure proceedings when the loan is 120 days past due. If the loan is reinstated, foreclosure proceedings will be discontinued and the borrower will be permitted to continue to make payments. In certain instances, we may modify the loan or grant a limited exemption from loan payments to allow the borrower to reorganize their financial affairs.

When we acquire real estate as a result of foreclosure or by deed in lieu of foreclosure, the real estate is classified as other real estate owned until it is sold. The real estate is recorded at estimated fair value at the date of acquisition, less estimated costs to sell, and any write-down resulting from the acquisition is charged to the allowance for loan losses. Subsequent decreases in the value of the property are charged to operations. After acquisition, all costs in maintaining the property are expensed as incurred. Costs relating to the development and improvement of the property, however, are capitalized to the extent of estimated fair value less estimated costs to sell. At December 31, 2022, we had no real estate acquired as a result of foreclosure or by deed in lieu of foreclosure.

***Troubled Debt Restructurings.*** We occasionally modify loans to extend the term or make other concessions to help a borrower stay current on their loan and to avoid foreclosure. We consider modifications only after analyzing the borrower's current repayment capacity, evaluating the strength of any guarantors based on documented current financial information, and assessing the current value of any collateral pledged. We generally do not forgive principal or interest on loans, but may do so if it is in our best interest and increases the likelihood that we can collect the remaining principal balance. We may modify the terms of loans to lower interest rates (which may be at below market rates), to provide for fixed interest rates on loans where fixed rates are otherwise not available, to provide for longer amortization schedules, or to provide for interest-only terms. These modifications are made only when a workout plan has been agreed to by the borrower that we believe is reasonable and attainable and in our best interests. At December 31, 2022, we had no troubled debt restructurings.

***Delinquent Loans***. The following table sets forth our loan delinquencies by type and amount at the dates indicated.

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| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | | | | **At September 30,** | **At September 30,** | **At September 30,** | **At September 30,** | **At September 30,** | **At September 30,** |
|  | **At December 31, 2022** | **At December 31, 2022** | **At December 31, 2022** | **2022** | **2022** | **2022** | **2021** | **2021** | **2021** |
|  | **30-59**<br> **Days**<br> **Past Due** | **60-89**<br> **Days**<br> **Past Due** | **90 Days**<br> **or More**<br> **Past Due** | **30-59**<br> **Days**<br> **Past Due** | **60-89**<br> **Days**<br> **Past Due** | **90 Days**<br> **or More**<br> **Past Due** | **30-59**<br> **Days**<br> **Past Due** | **60-89**<br> **Days**<br> **Past Due** | **90 Days**<br> **or More**<br> **Past Due** |
|  | **(In thousands)** | **(In thousands)** | **(In thousands)** | **(In thousands)** | **(In thousands)** | **(In thousands)** | **(In thousands)** | **(In thousands)** | **(In thousands)** |
| Real estate loans: |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;One- to four-family | $534 | $413 | $288 | $271 | $65 | $347 | $543 | $45 | $166 |
| &nbsp;&nbsp;&nbsp;Multifamily |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Agricultural |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Commercial |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Construction and land |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Home equity lines of credit |  |  | 144 | 144 |  |  |  |  |  |
| Commercial and industrial loans |  |  |  |  |  |  | 20 |  | 28 |
| Consumer loans | – | – | – | – | – | 3 | – | – | 19 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total | $534 | $413 | $432 | $415 | $65 | $350 | $563 | $45 | $213 |

---

***Non-Performing Assets.*** The following table sets forth information regarding our non-performing assets. Non-performing assets include loans that are 90 or more days past due or on non-accrual status, including troubled debt restructurings on non-accrual status, and real estate and other loan collateral acquired through foreclosure and repossession. We had no troubled debt restructurings, no loans that were 90 days or more past due and accruing, and no foreclosed assets at December 31, 2022, September 30, 2022 or September 30, 2021.

---

| | | | |
|:---|:---|:---|:---|
|  | | **At September 30,** | **At September 30,** |
|  | **At December 31,**<br>**2022** | **2022** | **2021** |
|  | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** |
| Non-accrual loans: |  |  |  |
| Real estate loans: |  |  |  |
| &nbsp;&nbsp;&nbsp;One- to four-family | $288 | $347 | $166 |
| &nbsp;&nbsp;&nbsp;Multifamily |  |  |  |
| &nbsp;&nbsp;&nbsp;Agricultural |  |  |  |
| &nbsp;&nbsp;&nbsp;Commercial |  |  |  |
| &nbsp;&nbsp;&nbsp;Construction and land |  |  |  |
| &nbsp;&nbsp;&nbsp;Home equity lines of credit | 144 |  | 28 |
| Commercial and industrial loans |  |  |  |
| Consumer loans | – | 3 | 19 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total non-performing loans | 432 | 350 | 213 |
| Total non-performing assets | $432 | $350 | $213 |
| Total non-performing loans to total loans | 0.35% | 0.29% | 0.19% |
| Total non- performing loans to total assets | 0.30% | 0.23% | 0.14% |
| Total non-performing assets to total assets | 0.30% | 0.23% | 0.14% |

---

***Classified Assets***. Federal regulations provide that loans and other assets of lesser quality should be classified as "substandard," "doubtful" or "loss." An asset is considered "substandard" if it is inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. "Substandard" assets include those characterized by the "distinct possibility" that the insured institution will sustain "some loss" if the deficiencies are not corrected. Assets classified as "doubtful" have all of the weaknesses inherent in those classified "substandard," with the added characteristic that the weaknesses present make "collection or liquidation in full," on the basis of currently existing facts, conditions, and values, "highly questionable and improbable." Assets classified as "loss" are those considered "uncollectible" and of such little value that their continuance as assets without the establishment of a specific allowance for loan losses is not warranted. Assets that do not currently expose the insured institution to sufficient risk to warrant classification in one of the aforementioned categories but possess weaknesses are designated as "special mention."

When an insured institution classifies problem assets as either substandard or doubtful, it may establish general allowances in an amount deemed prudent by management to cover losses that were both probable and reasonable to estimate. General allowances represent allowances which have been established to cover accrued losses associated with lending activities that were both probable and reasonable to estimate, but which, unlike specific allowances, have not been allocated to particular problem assets. When an insured institution classifies problem assets as "loss," it is required either to establish a specific allowance for losses equal to 100% of that portion of the asset so classified or to charge-off such amount. An institution's determination as to the classification of its assets and the amount of its valuation allowances is subject to review by the regulatory authorities, which may require the establishment of additional general or specific allowances.

In connection with the filing of our periodic regulatory reports and according to our classification of assets policy, we regularly review the problem loans in our portfolio to determine whether any loans require classification according to applicable regulations. If a problem loan deteriorates in asset quality, the classification is changed to "substandard," "doubtful" or "loss" depending on the circumstances and the evaluation. Generally, loans 90 days or more past due are placed on nonaccrual status and classified "substandard."

The table below sets forth our classified loans at the dates indicated. We did not have any "special mention" loans at the dates indicated.

---

| | | | |
|:---|:---|:---|:---|
|  | | **At September 30,** | **At September 30,** |
|  | **At<br> December 31,**<br>**2022** | **2022** | **2021** |
|  | **(In thousands)** | **(In thousands)** | **(In thousands)** |
| Substandard loans | $793 | $350 | $213 |
| Doubtful loans |  |  |  |
| Loss loans | – | – | – |
| &nbsp;&nbsp;&nbsp;Total classified assets | $793 | $350 | $213 |

---

***Other Loans of Concern.*** At December 31, 2022, except for loans included in the above table, there were no other loans of concern for which we had information about possible credit problems of borrowers that caused us to have serious doubts about the ability of the borrowers to comply with present loan repayment terms and that may result in disclosure of such loans in the future.

**Allowance for Loan Losses**

The allowance for loan losses is maintained at a level which, in management's judgment, is adequate to absorb probable credit losses inherent in the loan portfolio. The amount of the allowance is based on management's evaluation of the collectability of the loan portfolio, including the nature of the portfolio, credit concentrations, trends in historical loss experience, specific impaired loans, and economic conditions. Allowances for impaired loans are generally determined based on collateral values or the present value of estimated cash flows. Because of uncertainties associated with regional economic conditions, collateral values, and future cash flows on impaired loans, it is reasonably possible that management's estimate of probable credit losses inherent in the loan portfolio and the related allowance may change materially in the near-term. The allowance is increased by a provision for loan losses, which is charged to expense and reduced by full and partial charge-offs, net of recoveries. Changes in the allowance relating to impaired loans are charged or credited to the provision for loan losses. Management's periodic evaluation of the adequacy of the allowance is based on various factors, including, but not limited to, management's ongoing review and grading of loans, facts and issues related to specific loans, historical loan loss and delinquency experience, trends in past due and non-accrual loans, existing risk characteristics of specific loans or loan pools, the fair value of underlying collateral, current economic conditions and other qualitative and quantitative factors which could affect potential credit losses.

A new credit loss accounting standard, the Current Expected Credit Loss standard ("CECL"), will become effective for Mercer Savings Bank on October 1, 2023. CECL requires financial institutions to determine periodic estimates of lifetime expected credit losses on loans and recognize the expected credit losses as allowances for credit losses. This will change the current method of providing allowances for loan losses that are incurred or probable, which may require us to increase our allowance for credit losses and will require us to greatly increase the types of data we need to collect and review to determine the appropriate level of the allowance for credit losses.

As an integral part of their examination process, bank regulatory agencies periodically review the allowance for loan losses and may require an increase in the provision for possible loan losses or the recognition of loan charge-offs, based on judgments different than those of management.

The following table sets forth activity in our allowance for loan losses for the periods indicated.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **At or For the Three Months Ended**<br> **December 31,** | **At or For the Three Months Ended**<br> **December 31,** | **At or For the Year Ended**<br> **September 30,** | **At or For the Year Ended**<br> **September 30,** |
|  | **2022** | **2021** | **2022** | **2021** |
|  | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** |
| Allowance for loan losses at beginning of period | $984 | $958 | $958 | $840 |
| Provision for loan losses |  | 15 | 25 | 180 |
| Charge-offs: |  |  |  |  |
| Real estate loans: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;One- to four-family | (23) |  |  | (62) |
| &nbsp;&nbsp;&nbsp;Multifamily |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Agricultural |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Commercial |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Construction and land |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Home equity lines of credit |  |  |  |  |
| Commercial and industrial loans |  |  |  |  |
| Consumer loans | – | – | – | – |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total charge-offs | (23) | – | – | (62) |
| Recoveries: |  |  |  |  |
| Real estate loans: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;One- to four-family |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Multifamily |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Agricultural |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Commercial |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Construction and land |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Home equity lines of credit |  |  |  |  |
| Commercial and industrial loans |  |  |  |  |
| Consumer loans | – | – | 1 | – |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total recoveries | – | – | 1 | – |
| Net (charge-offs) recoveries | (23) | – | 1 | (62) |
| Allowance at end of period | $961 | $973 | $984 | $958 |
| Allowance for loan losses to total loans outstanding at end of period | 0.79% | 0.84% | 0.81% | 0.83% |
| Non-accrual loans to total loans outstanding at end of period | 0.35% | 0.13% | 0.29% | 0.19% |
| Allowance for loan losses to non-accrual loans at end of period | 222.45% | 926.67% | 281.14% | 449.77% |
| Net (charge-offs) recoveries to average loans outstanding during period | (0.02)%<sup>(1)</sup> | –<sup>(1)</sup> |  | (0.06)% |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Annualized.

The following table sets forth additional information with respect to charge-offs by category for the periods indicated.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended<br> December 31,** | **For the Three Months Ended<br> December 31,** | **For the Year Ended<br> September 30,** | **For the Year Ended<br> September 30,** |
|  | **2022** | **2021** | **2022** | **2021** |
| Net (charge-offs) recoveries to average loans outstanding during the period: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Real estate loans: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;One- to four-family | (0.02)% |  |  | (0.06)% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Multifamily |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Agricultural |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Commercial |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Construction and land |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Home equity lines of credit |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Commercial and industrial loans |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Consumer loans |  |  |  |  |

---

***Allocation of Allowance for Loan Losses.*** The following table sets forth the allowance for loan losses allocated by loan category and the percent of the allowance in each category to the total allocated allowance at the dates indicated. The allowance for loan losses allocated to each category is not necessarily indicative of future losses in any particular category and does not restrict the use of the allowance to absorb losses in other categories.

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | | | | **At September 30,** | **At September 30,** | **At September 30,** | **At September 30,** | **At September 30,** | **At September 30,** |
|  | **At December 31, 2022** | **At December 31, 2022** | **At December 31, 2022** | **2022** | **2022** | **2022** | **2021** | **2021** | **2021** |
|  | **Allowance<br> for Loan<br> Losses** | **Percent of<br> Allowance in<br> Category to<br> Total<br> Allowance** | **Percent of<br> Loans in<br> Category to<br> Total Loans** | **Allowance<br> for Loan<br> Losses** | **Percent of<br> Allowance in<br> Category to<br> Total<br> Allowance** | **Percent of<br> Loans in<br> Category to<br> Total Loans** | **Allowance<br> for Loan<br> Losses** | **Percent of Allowance in Category to Total Allowance** | **Percent of Loans in Category to Total Loans** |
|  | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** |
| Real estate loans: |  |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;One- to four-family | $660 | 68.7% | 62.6% | $624 | 63.4% | 64.4% | $627 | 65.4% | 64.2% |
| &nbsp;&nbsp;&nbsp;&nbsp;Multifamily | 12 | 1.2 | 1.1 | 11 | 1.1 | 1.1 | 10 | 1 | 1 |
| &nbsp;&nbsp;&nbsp;&nbsp;Agricultural | 154 | 16 | 25.3 | 199 | 20.2 | 23.5 | 211 | 22 | 23.7 |
| &nbsp;&nbsp;&nbsp;&nbsp;Commercial | 9 | 0.9 | 1.5 | 11 | 1.1 | 1.5 | 12 | 1.3 | 1.6 |
| &nbsp;&nbsp;&nbsp;&nbsp;Construction and land | 39 | 4.1 | 3.5 | 35 | 3.6 | 3 | 32 | 3.3 | 3.2 |
| &nbsp;&nbsp;&nbsp;&nbsp;Home equity lines of credit | 47 | 4.9 | 3.9 | 69 | 7 | 4.3 | 40 | 4.2 | 3.7 |
| Commercial and industrial loans | 9 | 0.9 | 1.4 | 12 | 1.2 | 1.5 | 12 | 1.3 | 1.9 |
| Consumer loans | 31 | 3.2 | 0.7 | 23 | 2.3 | 0.8 | 14 | 1.5 | 0.8 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total allocated allowance | 961 | 100.0% | 100.0% | 984 | 100.0% | 100.0% | 958 | 100.0% | 100.0% |
| Unallocated | - |  |  |  |  |  | - |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total | $961 |  |  | $984 |  |  | $958 |  |  |

---

Although we believe that we use the best information available to establish the allowance for loan losses, future adjustments to the allowance for loan losses may be necessary and results of operations could be adversely affected if circumstances differ substantially from the assumptions used in making the determinations. Because future events affecting borrowers and collateral cannot be predicted with certainty, the existing allowance for loan losses may not be adequate and management may determine that increases in the allowance are necessary if the quality of any portion of our loan portfolio deteriorates as a result. Furthermore, as an integral part of its examination process, the ODFI and the FDIC will periodically review our allowance for loan losses. The ODFI or the FDIC may have judgments different than those of management, and we may determine to increase our allowance as a result of these regulatory reviews. Any material increase in the allowance for loan losses may adversely affect our financial condition and results of operations.

**Investment Activities**

***General*.** The goals of our investment policy are to maximize portfolio yield over the long term in a manner that is consistent with minimizing risk and to meet liquidity needs, satisfy pledging requirements, and support asset/liability management and interest rate risk strategies. Subject to loan demand and our interest rate risk analysis, we will increase the balance of our investment securities portfolio when we have excess liquidity.

Our investment policy was adopted by the board of directors and is reviewed annually by the board of directors. Our full board of directors serves as our investment committee. In this capacity the board develops and implements an asset/liability management plan, and reviews pricing and liquidity needs and assesses our interest rate risk. An investment schedule detailing the investment portfolio is reviewed at least quarterly by the board of directors.

Our current investment policy permits, with certain limitations, investments in U.S. Treasury securities; securities issued by the U.S. government and its agencies or government sponsored enterprises including mortgage-backed securities and collateralized mortgage obligations issued by Fannie Mae, Ginnie Mae, and Freddie Mac; corporate and municipal bonds; certificates of deposit in other financial institutions; and federal funds and money market funds, among other investments.

At December 31, 2022, our investment portfolio consisted of U.S. Treasury obligations, securities and obligations issued by U.S. government-sponsored enterprises, and municipal securities. At December 31, 2022, we also owned $1.4 million of Federal Home Loan Bank of Cincinnati stock. As a member of Federal Home Loan Bank of Cincinnati, we are required to purchase stock in the Federal Home Loan Bank of Cincinnati, which is carried at cost and classified as a restricted investment.

The following table sets forth the maturities and weighted average yields of debt securities not carried at fair value through earnings as of December 31, 2022, September 30, 2022 and September 30, 2021. Weighted average yields are as of the period end. Tax-equivalent yield is presented for tax-exempt municipal securities.

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **One Year or Less** | **One Year or Less** | **More than One Year<br> to Five Years** | **More than One Year<br> to Five Years** | **More than Five Years<br> to Ten Years** | **More than Five Years<br> to Ten Years** | **More than Ten Years** | **More than Ten Years** |
|  | **Amortized Cost** | **Weighted Average Yield** | **Amortized Cost** | **Weighted Average Yield** | **Amortized Cost** | **Weighted Average Yield** | **Amortized Cost** | **Weighted Average Yield** |
|  | (Dollars in thousands) | (Dollars in thousands) | (Dollars in thousands) | (Dollars in thousands) | (Dollars in thousands) | (Dollars in thousands) | (Dollars in thousands) | (Dollars in thousands) |
| **December 31, 2022** |  |  |  |  |  |  |  |  |
| **Held-to-maturity:** |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Mortgage-backed Government Sponsored Enterprises (GSEs) | $1 | 2.99% | $83 | 2.18% | $128 | 3.08% | $— | —% |
| **Available-for-sale:** |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;U.S. Treasury Securities | $1006 | 0.14% | $999 | 0.32% | $— | —% | $— | —% |
| &nbsp;&nbsp;&nbsp;U.S. Government Agencies | 1001 | 0.17% | 3021 | 1.92% |  | —% |  | —% |
| &nbsp;&nbsp;&nbsp;Mortgage-backed GSEs |  | —% |  | —% | 221 | 1.75% | 3812 | 1.92% |
| &nbsp;&nbsp;&nbsp;State and political subdivisions | 253 | 0.68% | 441 | 3.23% |  | —% | 3533 | 3.66% |
| **September 30, 2022** |  |  |  |  |  |  |  |  |
| **Held-to-maturity:** |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Mortgage-backed GSEs | $1 | 2.97% | $98 | 2.19% | $33 | 3.14% | $101 | 2.00% |
| **Available-for-sale:** |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;U.S. Treasury Securities | $1010 | 0.14% | $999 | 0.32% | $— | —% | $— | —% |
| &nbsp;&nbsp;&nbsp;U.S. Government Agencies |  | —% | 4026 | 1.48% |  | —% |  | —% |
| &nbsp;&nbsp;&nbsp;Mortgage-backed GSEs |  | —% |  | —% | 240 | 1.71% | 3951 | 1.88% |
| &nbsp;&nbsp;&nbsp;State and political subdivisions | 255 | 0.68% | 973 | 3.02% |  | —% | 2262 | 2.91% |
| **September 30, 2021** |  |  |  |  |  |  |  |  |
| **Held-to-maturity:** |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Mortgage-backed GSEs | $— | —% | $177 | 2.11% | $43 | 3.13% | $119 | 1.13% |
| **Available-for-sale:** |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;U.S. Treasury Securities | $— | —% | $2023 | 0.23% | $— | —% | $— | —% |
| &nbsp;&nbsp;&nbsp;U.S. Government Agencies |  | —% | 2005 | 0.22% |  | —% |  | —% |
| &nbsp;&nbsp;&nbsp;Mortgage-backed GSEs |  | —% |  | —% | 354 | 1.76% | 3017 | 1.03% |
| &nbsp;&nbsp;&nbsp;State and political subdivisions |  | —% | 800 | 2.33% |  | —% | 328 | 2.74% |

---

For additional information regarding our investment securities portfolio, see Note 3 of the notes to financial statements beginning on page F-1 of this prospectus.

**Sources of Funds**

***General.*** Deposits have traditionally been our primary source of funds for use in lending and investment activities. We may also use borrowings to supplement cash flow needs, lengthen the maturities of liabilities for interest rate risk purposes and to manage the cost of funds. In addition, we receive funds from scheduled loan payments, investment maturities, loan prepayments, retained earnings and income on earning assets. While scheduled loan payments and income on earning assets are relatively stable sources of funds, deposit inflows and outflows can vary widely and are influenced by prevailing interest rates, market conditions and levels of competition.

***Deposits.*** Our deposits are generated primarily from our primary market area. We offer a selection of deposit accounts, including savings accounts, checking accounts, certificates of deposit and individual retirement accounts. Deposit account terms vary, with the principal differences being the minimum balance required, the amount of time the funds must remain on deposit and the interest rate.

Interest rates paid, maturity terms, service fees and withdrawal penalties are established on a periodic basis. Deposit rates and terms are based primarily on current operating strategies and market rates, liquidity requirements, rates paid by competitors and growth goals. We rely upon personalized customer service, long-standing relationships with customers, and our favorable reputation in the community to attract and retain local deposits. We also seek to obtain deposits from our commercial loan customers.

The flow of deposits is influenced significantly by general economic conditions, changes in money market and other prevailing interest rates and competition. The variety of deposit accounts offered allows us to be competitive in obtaining funds and responding to changes in consumer demand. Based on experience, we believe that our deposits are relatively stable. However, the ability to attract and maintain deposits and the rates paid on these deposits, has been and will continue to be significantly affected by market conditions.

The following table sets forth the distribution of total deposits by account type at the dates indicated.

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | | | | **At September 30,** | **At September 30,** | **At September 30,** | **At September 30,** | **At September 30,** | **At September 30,** |
|  | **At December 31, 2022** | **At December 31, 2022** | **At December 31, 2022** | **2022** | **2022** | **2022** | **2021** | **2021** | **2021** |
|  | **Amount** | **Percent** | **Average<br> Rate** | **Amount** | **Percent** | **Average<br> Rate** | **Amount** | **Percent** | **Average<br> Rate** |
|  | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** |
| Noninterest-bearing demand deposits | $15444 | 12.1% | 0.00% | $18210 | 13.5% | 0.00% | $12616 | 9.8% | 0.00% |
| Interest-bearing demand deposits | 44090 | 34.5 | 0.05 | 47114 | 35.0 | 0.05 | 43621 | 34.0 | 0.05 |
| Savings deposits | 45075 | 35.3 | 0.05 | 44169 | 32.8 | 0.05 | 41416 | 32.3 | 0.05 |
| Certificates of deposit | 23090 | 18.1 | 0.78 | 25266 | 18.7 | 0.68 | 30592 | 23.9 | 0.72 |
| Total | $127699 | 100.00% | 0.18% | $134759 | 100.00% | 0.16% | $128245 | 100.00% | 0.20% |

---

We consider our core deposits to include savings accounts, money market accounts, other savings deposits and checking accounts. Core deposits totaled $104.6 million, or 81.9% of total deposits, at December 31, 2022.

As of December 31, 2022, September 30, 2022 and September 30, 2021, the aggregate amount of uninsured deposits (deposits in amounts greater than $250,000, which is the maximum amount for federal deposit insurance), was $18.3 million, $25.5 million and $16.8 million, respectively. In addition, as of December 31, 2022, the aggregate amount of all our uninsured certificates of deposit was $1.4 million. We have no deposits that are uninsured for any reason other than being in excess of the maximum amount for federal deposit insurance.

The following table sets forth our uninsured time deposits at December 31, 2022 by time remaining until maturity.

---

| | |
|:---|:---|
|  | **At**<br> **December 31, 2022** |
|  | **(In thousands)** |
| **Maturity Period:** |  |
| &nbsp;&nbsp;&nbsp;Three months or less | $252 |
| &nbsp;&nbsp;&nbsp;Over six through three months | 261 |
| &nbsp;&nbsp;&nbsp;Over six through twelve months | 881 |
| &nbsp;&nbsp;&nbsp;Over twelve months | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total | $1394 |

---

***Borrowings.*** We may obtain advances from the Federal Home Loan Bank of Cincinnati upon the security of our capital stock in it and our one- to four-family residential real estate portfolio. We may utilize these advances for asset/liability management purposes and for additional funding for our operations. Such advances may be made under several different credit programs, each of which has its own interest rate and range of maturities. At December 31, 2022, we had $3.0 million in outstanding advances from the Federal Home Loan Bank of Cincinnati. At December 31, 2022, based on available collateral and our ownership of Federal Home Loan Bank of Cincinnati common stock, we had access to up to $53.9 million of advances from the Federal Home Loan Bank of Cincinnati.

**Properties**

At December 31, 2022, the net book value of our properties (including furniture, fixtures and equipment) was $2.6 million. We conduct our operations from our main office in Celina, Ohio and three branch offices in Celina, Fort Recovery and Greenville, Ohio. We own all of our branch office properties. Although we believe that our current facilities are adequate to meet our present and foreseeable needs, to expand access to customers and deposits, we intend to open a fifth branch office in Adams or Jay County in eastern Indiana, which are contiguous to our Ohio market area, in 2024. We have not yet selected a location for that office, but we currently expect that we will purchase a property in connection with the establishment of the branch.

**Subsidiary Activities**

Upon completion of the conversion and stock offering, Mercer Savings Bank will become the sole and wholly-owned subsidiary of Mercer Bancorp. Mercer Savings Bank has no subsidiaries.

**Legal Proceedings**

We are not involved in any pending legal proceedings other than routine legal proceedings occurring in the ordinary course of business. At December 31, 2022, we were not involved in any legal proceedings, the outcome of which we believe would be material to our financial condition or results of operations.

**Expense and Tax Allocation Agreements**

Upon the completion of the conversion and stock offering, Mercer Savings Bank will enter into an agreement with Mercer Bancorp for Mercer Savings Bank to provide Mercer Bancorp with certain administrative support services, including use of the premises, furniture, equipment and employees of Mercer Savings Bank as needed in the conduct of Mercer Bancorp's business. Mercer Bancorp will compensate Mercer Savings Bank in an amount not less than the fair market value of the services provided. In addition, upon the consummation of the conversion and stock offering, Mercer Bancorp and Mercer Savings Bank will enter into an agreement to establish a method for allocating and reimbursing the payment of their consolidated Federal and state tax liabilities and any local tax liabilities.

**Employees**

At December 31, 2022, we had 28 full-time employees and two part-time employees. Our employees are not represented by a collective bargaining group. Management believes that we have a good working relationship with our employees.

**REGULATION AND SUPERVISION**

**General**

As an Ohio state-chartered mutual bank, Mercer Savings Bank is subject to examination and regulation by the ODFI, as its chartering authority, and is also subject to examination by the FDIC, its primary federal regulatory and deposit insurer. This regulation and supervision establishes a comprehensive framework of activities in which an institution may engage and is intended primarily for the protection of the FDIC's deposit insurance fund and depositors, and not for the protection of security holders. Mercer Savings Bank also is a member of and owns stock in the Federal Home Loan Bank of Cincinnati, which is one of the 11 regional banks in the Federal Home Loan Bank System.

Under this system of regulation, the regulatory authorities have extensive discretion in connection with their supervisory, enforcement, rulemaking and examination activities and policies, including rules or policies that: establish minimum capital levels; restrict the timing and amount of dividend payments; govern the classification of assets; determine the adequacy of loan loss reserves for regulatory purposes; and establish the timing and amounts of assessments and fees. Moreover, as part of their examination authority, the banking regulators assign numerical ratings to banks and savings institutions relating to capital, asset quality, management, liquidity, earnings and other factors. The receipt of a less than satisfactory rating in one or more categories may result in enforcement action by the banking regulators against a financial institution. A less than satisfactory rating may also prevent a financial institution, such as Mercer Savings Bank or its holding company, from obtaining necessary regulatory approvals to access the capital markets, pay dividends, acquire other financial institutions or establish new branches.

In addition, we must comply with significant anti-money laundering and anti-terrorism laws and regulations, Community Reinvestment Act laws and regulations, and fair lending laws and regulations. Government agencies have the authority to impose monetary penalties and other sanctions on institutions that fail to comply with these laws and regulations, which could significantly affect our business activities, including our ability to acquire other financial institutions or expand our branch network.

Following the conversion and stock offering, Mercer Bancorp will be a bank holding company and will be required to comply with the rules and regulations of the Federal Reserve Board. It will be required to file certain reports with the Federal Reserve Board and will be subject to examination by the enforcement authority of the Federal Reserve Board. Mercer Bancorp will also be subject to the rules and regulations of the Securities and Exchange Commission under the federal securities laws.

Any change in applicable laws or regulations, whether by the ODFI, the FDIC, the Federal Reserve Board or Congress, could have a material adverse impact on the operations and financial performance of Mercer Bancorp and Mercer Savings Bank.

Set forth below is a brief description of material regulatory requirements that are or will be applicable to Mercer Savings Bank and Mercer Bancorp. The description is limited to certain material aspects of the statutes and regulations addressed, and is not intended to be a complete description of such statutes and regulations and their effects on Mercer Savings Bank and Mercer Bancorp.

**Ohio Bank Regulation**

Mercer Savings Bank is an Ohio state-chartered bank. Ohio banking law governs the powers, rights and privileges of state-chartered banks, including limitations on the nature and amount of loans and investments the bank may make and other aspects of banking operations. Under current Ohio law, we may open branch offices throughout Ohio with the prior approval of the ODFI. In addition, with prior regulatory approval or non-objection, we may acquire branches of existing banks located in Ohio. Additionally, under the Dodd-Frank Act, with prior regulatory approval or non-objection, we and any other state-chartered bank or national bank may establish a de novo branch in any other state.

Ohio banking law also governs the payment of dividends to stockholders. As a holding company and the sole stockholder of Mercer Savings Bank, Mercer Bancorp will be a separate and distinct legal entity from Mercer Savings Bank and does not intend to have significant operations beyond holding the outstanding common stock of Mercer Savings Bank. Accordingly, Mercer Bancorp may rely on dividends from Mercer Savings Bank for a substantial portion of its revenue. Without approval from the ODFI, Mercer Savings Bank will be permitted to fund any cash dividends only from undivided profits, after having made all required allocations to reserves for losses or contingencies. ODFI approval will be required for any dividends funded from surplus or if the total of all cash dividends declared in any year exceeds the total of its net income for that year combined with its retained net income of the preceding two years.

As an Ohio state-chartered bank, Mercer Savings Bank is subject to supervision, regulation and periodic examination by the ODFI. These examinations are designed primarily for the protection of the depositors of the bank and not shareholders.

**Federal Banking Regulation**

***Capital Requirements***. Federal regulations require FDIC-insured depository institutions to meet several minimum capital standards: a common equity Tier 1 capital to risk-based assets ratio of 4.5%, a Tier 1 capital to risk-based assets ratio of 6.0%, a total capital to risk-based assets of 8.0%, and a 4.0% Tier 1 capital to total assets leverage ratio. The existing capital requirements were effective January 1, 2015 and are the result of a final rule implementing regulatory amendments based on recommendations of the Basel Committee on Banking Supervision and certain requirements of the Dodd-Frank Act.

Common equity Tier 1 capital is generally defined as common stockholders' equity and retained earnings. Tier 1 capital is generally defined as common equity Tier 1 and additional Tier 1 capital. Additional Tier 1 capital includes certain noncumulative perpetual preferred stock and related surplus and minority interests in equity accounts of consolidated subsidiaries. Total capital includes Tier 1 capital (common equity Tier 1 capital plus additional Tier 1 capital) and Tier 2 capital. Tier 2 capital is comprised of capital instruments and related surplus, meeting specified requirements, and may include cumulative preferred stock and long-term perpetual preferred stock, mandatory convertible securities, intermediate preferred stock and subordinated debt. Also included in Tier 2 capital is the allowance for loan and lease losses limited to a maximum of 1.25% of risk-weighted assets and, for institutions that have exercised an opt-out election regarding the treatment of Accumulated Other Comprehensive Income ("AOCI"), up to 45% of net unrealized gains on available-for-sale equity securities with readily determinable fair market values. Institutions that have not exercised the AOCI opt-out have AOCI incorporated into common equity Tier 1 capital (including unrealized gains and losses on available-for-sale-securities). Mercer Savings Bank exercised its AOCI opt-out election. Calculation of all types of regulatory capital is subject to deductions and adjustments specified in the regulations.

In determining the amount of risk-weighted assets for purposes of calculating risk-based capital ratios, all assets, including certain off-balance sheet assets (<u>e.g.</u>, recourse obligations, direct credit substitutes, residual interests) are multiplied by a risk weight factor assigned by the regulations based on the risks believed inherent in the type of asset. Higher levels of capital are required for asset categories believed to present greater risk. For example, a risk weight of 0% is assigned to cash and U.S. government securities, a risk weight of 50% is generally assigned to prudently underwritten first lien one- to four-family residential real estate loans, a risk weight of 100% is assigned to commercial and consumer loans, a risk weight of 150% is assigned to certain past due loans and a risk weight of between 0% to 600% is assigned to permissible equity interests, depending on certain specified factors.

In addition to establishing the minimum regulatory capital requirements, the regulations limit capital distributions and certain discretionary bonus payments to management if the institution does not hold a "capital conservation buffer" consisting of 2.5% of common equity Tier 1 capital to risk-weighted asset above the amount necessary to meet its minimum risk-based capital requirements.

In assessing an institution's capital adequacy, the FDIC takes into consideration, not only these numeric factors, but qualitative factors as well, including the bank's exposure to interest rate risk. The FDIC has the authority to establish higher capital requirements for individual institutions where deemed necessary due to a determination that an institution's capital level is, or is likely to become, inadequate in light of particular circumstances.

The Economic Growth, Regulatory Relief and Consumer Protection Act ("EGRRCPA") required the federal banking agencies, including the FDIC, to establish for institutions with assets of less than $10 billion a "Community Bank Leverage Ratio" of between 8 to 10%. Institutions with capital meeting or exceeding the ratio and otherwise complying with the specified requirements (including off-balance sheet exposures of 25% or less of total assets and trading assets and liabilities of 5% or less of total assets) and electing the alternative framework are considered to comply with the applicable regulatory capital requirements.

The Community Bank Leverage Ratio was established at 9% Tier 1 capital to total average assets, effective January 1, 2020. A qualifying institution may opt in and out of the community bank leverage ratio framework on its quarterly call report. An institution that temporarily ceases to meet any qualifying criteria is provided a two-quarter grace period to again achieve compliance. Failure to meet the qualifying criteria within the grace period or maintain a leverage ratio of 8% or greater requires the institution to comply with the generally applicable capital requirements. Mercer Savings Bank did not elect to use the Community Bank Leverage Ratio.

***Standards for Safety and Soundness.*** As required by statute, the federal banking agencies adopted final regulations and Interagency Guidelines Establishing Standards for Safety and Soundness to implement safety and soundness standards. The guidelines set forth the safety and soundness standards that the federal banking agencies use to identify and address problems at insured depository institutions before capital becomes impaired. The guidelines address internal controls and information systems, internal audit systems, credit underwriting, loan documentation, interest rate exposure, asset growth, asset quality, earnings and compensation, fees and benefits. The agencies have also established standards for safeguarding customer information. If the appropriate federal banking agency determines that an institution fails to meet any standard prescribed by the guidelines, the agency may require the institution to submit to the agency an acceptable plan to achieve compliance with the standard.

***Investment Activities.*** All FDIC-insured banks, including savings banks, are generally limited in their equity investment activities to equity investments of the type and in the amount authorized for national banks, notwithstanding state law, subject to certain exceptions. In addition, a state bank may engage in state-authorized activities or investments not permissible for national banks (other than non-subsidiary equity investments) if it meets all applicable capital requirements and it is determined by the FDIC that such activities or investments do not pose a significant risk to the Deposit Insurance Fund.

***Interstate Banking and Branching.*** Federal law permits well capitalized and well managed holding companies to acquire banks in any state, subject to Federal Reserve Board approval, certain concentration limits and other specified conditions. Interstate mergers of banks are also authorized, subject to regulatory approval and other specified conditions. In addition, among other things, amendments made by the Dodd-Frank Act permit banks to establish de novo branches on an interstate basis provided that branching is authorized by the law of the host state for the banks chartered by that state.

***Prompt Corrective Regulatory Action.*** Federal bank regulatory authorities are required to take "prompt corrective action" with respect to institutions that do not meet minimum capital requirements. For these purposes, the statute establishes five capital categories: well capitalized, adequately capitalized, undercapitalized, significantly undercapitalized, and critically undercapitalized. Under the regulations, a bank is deemed to be: (i) "well capitalized" if it has a total risk-based capital ratio of 10.0% or more, has a Tier 1 risk-based capital ratio of 8.0% or more, has a Tier 1 leverage capital ratio of 5.0% or more and a common equity Tier 1 ratio of 6.5% or more, and is not subject to any written capital order or directive; (ii) "adequately capitalized" if it has a total risk-based capital ratio of 8.0% or more, a Tier 1 risk-based capital ratio of 6.0% or more, a Tier 1 leveraged capital ratio of 4.0% or more and a common equity Tier 1 ratio of 4.5% or more, and does not meet the definition of "well capitalized"; (iii) "undercapitalized" if it has a total risk-based capital ratio that is less than 8.0%, a Tier 1 risk-based capital ratio that is less than 6.0%, a Tier 1 leverage capital ratio that is less than 4.0% or a common equity Tier 1 ratio of less than 4.5%; (iv) "significantly undercapitalized" if it has a total risk-based capital ratio that is less than 6.0% and a Tier 1 risk-based capital ratio that is less than 4.0% or a common equity Tier 1 ratio of less than 3.0%; or (v) "critically undercapitalized" if it has a ratio of tangible equity to total assets that is equal to or less than 2.0%.

Mercer Savings Bank was considered "well capitalized" for regulatory capital purposes as of December 31, 2022.

Federal law and regulations also specify circumstances under which a federal banking agency may reclassify a well-capitalized institution as adequately capitalized and may require an institution classified as less than well capitalized to comply with supervisory actions as if it were in the next lower category (except that the FDIC may not reclassify a significantly undercapitalized institution as critically undercapitalized).

The FDIC may order savings banks that have insufficient capital to take corrective actions. For example, a savings bank that is categorized as "undercapitalized" is subject to growth limitations and is required to submit a capital restoration plan, and a holding company that controls such a savings bank is required to guarantee that the savings bank complies with the restoration plan. A "significantly undercapitalized" savings bank may be subject to additional restrictions. Savings banks deemed by the FDIC to be "critically undercapitalized" would be subject to the appointment of a receiver or conservator.

***Transactions with Affiliates and Regulation W of the Federal Reserve Regulations.*** Transactions between banks and their affiliates are governed by federal law. An affiliate of a bank is any company or entity that controls, is controlled by or is under common control with the bank. In a holding company context, the parent bank holding company and any companies which are controlled by such parent holding company are affiliates of the bank (although subsidiaries of the bank itself, except financial subsidiaries, are generally not considered affiliates). Generally, Section 23A of the Federal Reserve Act and the Federal Reserve Board's Regulation W limit the extent to which a bank or its subsidiaries may engage in "covered transactions" with any one affiliate to an amount equal to 10.0% of such institution's capital stock and surplus, and with all such transactions with all affiliates to an amount equal to 20.0% of such institution's capital stock and surplus. Section 23B applies to "covered transactions" as well as to certain other transactions and requires that all such transactions be on terms substantially the same, or at least as favorable, to the institution or subsidiary as those provided to a non-affiliate. The term "covered transaction" includes the making of loans to, purchase of assets from, and issuance of a guarantee to an affiliate, and other similar transactions. Section 23B transactions also include the provision of services and the sale of assets by a bank to an affiliate. In addition, loans or other extensions of credit by the financial institution to the affiliate are required to be collateralized in accordance with the requirements set forth in Section 23A of the Federal Reserve Act.

Sections 22(h) and (g) of the Federal Reserve Act place restrictions on loans to a bank's insiders, i.e., executive officers, directors and principal stockholders. Under Section 22(h) of the Federal Reserve Act, loans to a director, an executive officer and to a greater than 10.0% stockholder of a financial institution, and certain affiliated interests of these persons, together with all other outstanding loans to such person and affiliated interests, may not exceed specified limits. Section 22(h) of the Federal Reserve Act also requires that loans to directors, executive officers and principal stockholders be made on terms substantially the same as offered in comparable transactions to other persons and also requires prior board approval for certain loans. In addition, the aggregate amount of extensions of credit by a financial institution to insiders cannot exceed the institution's unimpaired capital and surplus. Section 22(g) of the Federal Reserve Act places additional restrictions on loans to executive officers.

***Enforcement.*** The FDIC has extensive enforcement authority over insured state savings banks, including Mercer Savings Bank. The enforcement authority includes, among other things, the ability to assess civil money penalties, issue cease and desist orders and remove directors and officers. In general, these enforcement actions may be initiated in response to violations of laws and regulations, breaches of fiduciary duty and unsafe or unsound practices.

***Federal Insurance of Deposit Accounts.*** Mercer Savings Bank is a member of the Deposit Insurance Fund, which is administered by the FDIC. Mercer Savings Bank's deposit accounts are insured by the FDIC, generally up to a maximum of $250,000 per depositor.

The FDIC imposes deposit insurance assessments against all insured depository institutions. An institution's assessment rate depends upon the perceived risk of the institution to the Deposit Insurance Fund, with institutions deemed less risky paying lower rates. Currently, assessments for institutions of less than $10 billion of total assets are based on financial measures and supervisory ratings derived from statistical models estimating the probability of failure within three years. Assessment rates (inclusive of possible adjustments) currently range from 1.5 to 30 basis points of each institution's total assets less tangible capital. The FDIC may increase or decrease the range of assessments uniformly, except that no adjustment can deviate more than two basis points from the base assessment rate without notice and comment rulemaking.

The FDIC has the authority to increase insurance assessments. A significant increase in insurance premiums would have an adverse effect on the operating expenses and results of operations of Mercer Savings Bank. We cannot predict what deposit insurance assessment rates will be in the future.

Insurance of deposits may be terminated by the FDIC upon a finding that an institution has engaged in unsafe or unsound practices, is in an unsafe or unsound condition to continue operations or has violated any applicable law, regulation, rule, order or condition imposed by the FDIC. We do not know of any practice, condition or violation that might lead to termination of deposit insurance at Mercer Savings Bank.

***Privacy Regulations.*** Federal regulations generally require that Mercer Savings Bank disclose its privacy policy, including identifying with whom it shares a customer's "non-public personal information," to customers at the time of establishing the customer relationship and annually thereafter. In addition, Mercer Savings Bank is required to provide its customers with the ability to "opt-out" of having their personal information shared with unaffiliated third parties and not to disclose account numbers or access codes to non-affiliated third parties for marketing purposes. Mercer Savings Bank currently has a privacy protection policy in place and believes that such policy is in compliance with the regulations.

***Community Reinvestment Act.*** Under the Community Reinvestment Act, or CRA, as implemented by federal regulations, a state member bank has a continuing and affirmative obligation, consistent with its safe and sound operation, to help meet the credit needs of its entire community, including low and moderate income neighborhoods. The CRA does not establish specific lending requirements or programs for financial institutions nor does it limit an institution's discretion to develop the types of products and services that it believes are best suited to its particular community, consistent with the CRA. The CRA requires the FDIC, in connection with its examination of a state savings bank, to assess the institution's record of meeting the credit needs of its community and to take such record into account in its evaluation of certain applications by such institution, including applications to acquire branches and other financial institutions. The CRA requires a written evaluation of an institution's CRA performance utilizing a four-tiered descriptive rating system. Mercer Savings Bank's latest federal CRA rating was "Satisfactory."

***USA Patriot Act.*** Mercer Savings Bank is subject to the USA PATRIOT Act, which gives federal agencies additional powers to address terrorist threats through enhanced domestic security measures, expanded surveillance powers, increased information sharing, and broadened anti-money laundering requirements. The USA PATRIOT Act contains provisions intended to encourage information sharing among bank regulatory agencies and law enforcement bodies. Further, certain provisions impose affirmative obligations on a broad range of financial institutions, including banks, thrifts, brokers, dealers, credit unions, money transfer agents, and parties registered under the Commodity Exchange Act.

**Other Regulations**

Interest and other charges collected or contracted for by Mercer Savings Bank are subject to state usury laws and federal laws concerning interest rates. Loan operations are also subject to state and federal laws applicable to credit transactions, such as the:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Home Mortgage Disclosure
 Act of 1975, requiring financial institutions to provide information to enable the public
 and public officials to determine whether a financial institution is fulfilling its obligation
 to help meet the housing needs of the community it serves;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Equal Credit Opportunity
 Act, prohibiting discrimination on the basis of race, creed or other prohibited factors in
 extending credit;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Fair Credit Reporting
 Act of 1978, governing the use and provision of information to credit reporting agencies;
 and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Rules and regulations
 of the various federal and state agencies charged with the responsibility of implementing
 such federal and state laws.

The deposit operations of Mercer Savings Bank also are subject to, among others, the:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Right to Financial Privacy
 Act, which imposes a duty to maintain confidentiality of consumer financial records and prescribes
 procedures for complying with administrative subpoenas of financial records;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Check Clearing for the
 21st Century Act (also known as "Check 21"), which gives "substitute checks,"
 such as digital check images and copies made from that image, the same legal standing as
 the original paper check; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Electronic Funds Transfer
 Act and Regulation E promulgated thereunder, which govern automatic deposits to and withdrawals
 from deposit accounts and customers' rights and liabilities arising from the use of
 automated teller machines and other electronic banking services.

**Federal Home Loan Bank System**

Mercer Savings Bank is a member of the Federal Home Loan Bank of Cincinnati, which is one of 11 regional Federal Home Loan Banks in the Federal Home Loan Bank System. The Federal Home Loan Bank of Cincinnati provides a central credit facility primarily for its member institutions. Members of the Federal Home Loan Bank of Cincinnati are required to acquire and hold shares of capital stock in the Federal Home Loan Bank of Cincinnati. Mercer Savings Bank complied with this requirement at December 31, 2022. Based on redemption provisions of the Federal Home Loan Bank of Cincinnati, the stock has no quoted market value and is carried at cost. Mercer Savings Bank reviews for impairment, based on the ultimate recoverability, the cost basis of the Federal Home Loan Bank of Cincinnati stock. At December 31, 2022, no impairment has been recognized.

**Holding Company Regulation**

***General*.** Mercer Bancorp will be a bank holding company within the meaning of the Bank Holding Company of 1956. As such, Mercer Bancorp will be registered with the Federal Reserve Board and be subject to the regulation, examination, supervision and reporting requirements applicable to bank holding companies. In addition, the Federal Reserve Board has enforcement authority over Mercer Bancorp and its non-savings institution subsidiaries. Among other things, this authority permits the Federal Reserve Board to restrict or prohibit activities that are determined to be a serious risk to the subsidiary savings institution.

***Permissible Activities.*** A bank holding company is generally prohibited from engaging in non-banking activities, or acquiring direct or indirect control of more than 5% of the voting securities of any company engaged in non-banking activities. One of the principal exceptions to this prohibition is for activities found by the Federal Reserve Board to be so closely related to banking or managing or controlling banks as to be a proper incident thereto. Some of the principal activities that the Federal Reserve Board has determined by regulation to be so closely related to banking are: (i) making or servicing loans; (ii) performing certain data processing services; (iii) providing discount brokerage services; (iv) acting as fiduciary, investment or financial advisor; (v) leasing personal or real property; (vi) making investments in corporations or projects designed primarily to promote community welfare; and (vii) acquiring a savings and loan association whose direct and indirect activities are limited to those permitted for bank holding companies.

A bank holding company that meets specified conditions, including being "well capitalized" and "well managed," may opt to become a "financial holding company" and thereby engage in a broader array of financial activities than previously permitted. Such activities can include insurance underwriting and investment banking. A "financial holding company" may engage in a broader array of financial activities than permitted a typical bank holding company. Such activities can include insurance underwriting and investment banking. Mercer Bancorp will not elect "financial holding company" status in connection with the conversion.

***Capital.*** Bank holding companies are subject to consolidated regulatory capital requirements, which have historically been similar to, though less stringent than, those of the FDIC for Mercer Savings Bank. Federal legislation, however, required the Federal Reserve Board to promulgate consolidated capital requirements for depository institution holding companies that are no less stringent, both quantitatively and in terms of components of capital, than those applicable to institutions themselves. As a result, consolidated regulatory capital requirements identical to those applicable to the subsidiary banks generally apply to bank holding companies. However, the Federal Reserve Board has provided a "Small Bank Holding Company" exception to its consolidated capital requirements, such that bank holding companies with less than $3.0 billion of consolidated assets are not subject to the consolidated holding company regulatory capital requirements unless otherwise directed by the Federal Reserve Board.

***Source of Strength.*** The Federal Reserve Board has issued regulations requiring that all bank holding companies serve as a source of strength to their subsidiary depository institutions by providing financial, managerial and other support in times of an institution's distress.

***Dividends and Stock Repurchases.*** The Federal Reserve Board has issued a policy statement regarding the payment of dividends by holding companies. In general, the policy provides that dividends should be paid only out of current earnings and only if the prospective rate of earnings retention by the holding company appears consistent with the organization's capital needs, asset quality and overall supervisory financial condition. Separate regulatory guidance provides for prior consultation with Federal Reserve Bank staff concerning dividends in certain circumstances such as where the holding company's net income for the past four quarters, net of dividends previously paid over that period, is insufficient to fully fund the dividend or the company's overall rate of earnings retention is inconsistent with the company's capital needs and overall financial condition. The ability of a bank holding company to pay dividends may be restricted if a subsidiary bank becomes undercapitalized.

The regulatory guidance also states that a bank holding company should consult with Federal Reserve Bank supervisory staff prior to redeeming or repurchasing common stock or perpetual preferred stock if the bank holding company is experiencing financial weaknesses or the repurchase or redemption would result in a net reduction, at the end of a quarter, in the amount of such equity instruments outstanding compared with the beginning of the quarter in which the redemption or repurchase occurred.

There is a separate requirement that a bank holding company give the Federal Reserve Board prior written notice of any purchase or redemption of then outstanding equity securities if the gross consideration for the purchase or redemption, when combined with the net consideration paid for all such purchases or redemptions during the preceding 12 months, is equal to 10% or more of the company's consolidated net worth. The Federal Reserve Board may disapprove such a purchase or redemption if it determines that the proposal would constitute an unsafe and unsound practice, or would violate any law, regulation, Federal Reserve Board order or directive, or any condition imposed by, or written agreement with, the Federal Reserve Board. There is an exception to this approval requirement for well-capitalized bank holding companies that meet certain other conditions.

These regulatory policies may affect the ability of Mercer Bancorp to pay dividends, repurchase shares of common stock or otherwise engage in capital distributions.

**Federal Securities Laws**

Mercer Bancorp common stock will be registered with the Securities and Exchange Commission after the conversion and stock offering. Mercer Bancorp will be subject to the information, proxy solicitation, insider trading restrictions and other requirements under the Securities Exchange Act of 1934, as amended.

The registration under the Securities Act of 1933, as amended, of shares of common stock issued in Mercer Bancorp's stock offering does not cover the resale of those shares. Shares of common stock purchased by persons who are not affiliates of Mercer Bancorp may be resold without registration. Shares purchased by an affiliate of Mercer Bancorp will be subject to the resale restrictions of Rule 144 under the Securities Act of 1933. If Mercer Bancorp meets the current public information requirements of Rule 144 under the Securities Act of 1933, each affiliate of Mercer Bancorp that complies with the other conditions of Rule 144, including those that require the affiliate's sale to be aggregated with those of other persons, would be able to sell in the public market, without registration, a number of shares not to exceed, in any three-month period, the greater of 1% of the outstanding shares of Mercer Bancorp, or the average weekly volume of trading in the shares during the preceding four calendar weeks. In the future, Mercer Bancorp may permit affiliates to have their shares registered for sale under the Securities Act of 1933.

**Emerging Growth Company Status**

The JOBS Act, which was enacted in 2012, has made numerous changes to the federal securities laws to facilitate access to capital markets. Under the JOBS Act, a company with total annual gross revenues of less than $1.235 billion during its most recently completed fiscal year qualifies as an "emerging growth company." We qualify as an "emerging growth company" and believe that we will continue to qualify as an "emerging growth company" for five years from the completion of the stock offering.

An "emerging growth company" may choose not to hold stockholder votes to approve annual executive compensation (more frequently referred to as "say-on-pay" votes) or executive compensation payable in connection with a merger (more frequently referred to as "say-on-golden parachute" votes). An emerging growth company also is not subject to the requirement that its auditors attest to the effectiveness of the company's internal control over financial reporting, and can provide scaled disclosure regarding executive compensation; however, Mercer Bancorp will also not be subject to the auditor attestation requirement or additional executive compensation disclosure so long as it remains a "non-accelerated filer" and a "smaller reporting company," respectively, under Securities and Exchange Commission regulations (generally less than $250 million of voting and non-voting equity held by non-affiliates or less than $100 million in annual revenue). Finally, an emerging growth company may elect to comply with new or amended accounting pronouncements in the same manner as a private company, but must make such election when the company is first required to file a registration statement. Mercer Bancorp has elected to comply with new or amended accounting pronouncements in the same manner as a private company.

A company loses emerging growth company status on the earlier of: (i) the last day of the fiscal year of the company during which it had total annual gross revenues of $1.235 billion or more; (ii) the last day of the fiscal year of the issuer following the fifth anniversary of the date of the first sale of common equity securities of the company pursuant to an effective registration statement under the Securities Act of 1933; (iii) the date on which such company has, during the previous three-year period, issued more than $1.0 billion in non-convertible debt; or (iv) the date on which such company is deemed to be a "large accelerated filer" under Securities and Exchange Commission regulations (generally, at least $700 million of voting and non-voting equity held by non-affiliates).

**Sarbanes-Oxley Act of 2002**

The Sarbanes-Oxley Act of 2002 is intended to improve corporate responsibility, to provide for enhanced penalties for accounting and auditing improprieties at publicly traded companies and to protect investors by improving the accuracy and reliability of corporate disclosures required under the federal securities laws. We have policies, procedures and systems designed to comply with these regulations, and we review and document such policies, procedures and systems to ensure continued compliance with these regulations.

**Change in Control Regulations**

Under the Change in Bank Control Act, no person may acquire control of a bank holding company such as Mercer Bancorp unless the Federal Reserve Board has been given 60 days' prior written notice and has not issued a notice disapproving the proposed acquisition, taking into consideration certain factors, including the financial and managerial resources of the acquirer and the competitive effects of the acquisition. Control, as defined under federal law, means ownership, control of or holding irrevocable proxies representing more than 25% of any class of voting stock, control in any manner of the election of a majority of the institution's directors, or a determination by the regulator that the acquiror has the power, directly or indirectly, to exercise a controlling influence over the management or policies of the institution. Acquisition of more than 10% of any class of a bank holding company's voting stock constitutes a rebuttable determination of control under the regulations under certain circumstances including where, as will be the case with Mercer Bancorp, the issuer has registered securities under Section 12 of the Securities Exchange Act of 1934.

In addition, federal regulations provide that no company may acquire control of a bank holding company without the prior approval of the Federal Reserve Board. Any company that acquires such control becomes a "bank holding company" subject to registration, examination and regulation by the Federal Reserve Board.

**TAXATION**

**Federal Taxation**

***General.*** Mercer Bancorp and Mercer Savings are subject to federal income taxation in the same general manner as other corporations, with some exceptions discussed below. The following discussion of federal taxation is intended only to summarize material federal income tax matters and is not a comprehensive description of the tax rules applicable to Mercer Bancorp and Mercer Savings.

***Method of Accounting.*** For federal income tax purposes, Mercer Savings currently reports its income and expenses on the accrual method of accounting and uses a tax year ending September 30 for filing its federal income tax returns. The Small Business Protection Act of 1996 eliminated the use of the reserve method of accounting for bad debt reserves by savings institutions, effective for taxable years beginning after 1995.

***Minimum Tax.*** The alternative minimum tax ("AMT") for corporations has been repealed for tax years beginning after December 31, 2017. Any unused minimum tax credit of a corporation may be used to offset regular tax liability for any tax year. In addition, a portion of unused minimum tax credit was refundable in 2018 through 2021. The refundable portion is 50% (100% in 2021) of the excess of the minimum tax credit for the year over any credit allowable against regular tax for that year. At December 31, 2022 Mercer Savings had no minimum tax credit carryforward.

***Net Operating Loss Carryovers.*** Generally, a corporation may carry forward net operating losses generated in tax years beginning after December 31, 2017 indefinitely and can offset up to 80% of taxable income. At December 31, 2022, Mercer Savings had no net operating loss carryforwards.

***Capital Loss Carryovers.*** Generally, a corporation may carry back capital losses to the preceding three taxable years and forward to the succeeding five taxable years. Any capital loss carryback or carryover is treated as a short-term capital loss for the year to which it is carried. As such, it is grouped with any other capital losses for the year to which carried and is used to offset any capital gains. Any undeducted loss remaining after the five-year carryover period is not deductible. At December 31, 2022, Mercer Savings had no capital loss carryovers.

***Corporate Dividends.*** Mercer Bancorp may generally exclude from our income 100% of dividends received from Mercer Savings as a member of the same affiliated group of corporations.

***Audit of Tax Returns.*** Mercer Savings' federal income tax returns have not been audited in the most recent five-year period.

**State Taxation**

Mercer Savings is subject to Ohio taxation in the same general manner as other financial institutions. In particular, Mercer Savings files a consolidated Ohio Financial Institutions Tax ("FIT") return. The FIT is based upon the net worth of the consolidated group. For Ohio FIT purposes, savings institutions are currently taxed at a rate equal to 0.8% of taxable net worth, capped at 14% of the institution's total assets.

As a Maryland business corporation, Mercer Bancorp will be required to file an annual report with and pay personal property taxes to the State of Maryland.

**MANAGEMENT**

**Shared Management Structure**

Each director of Mercer Bancorp is a director of Mercer Savings Bank. Each executive officer of Mercer Bancorp is an executive officer of Mercer Savings Bank. We expect that Mercer Bancorp and Mercer Savings Bank will continue to have a shared management structure until there is a business reason to establish separate management structures.

**Executive Officers of Mercer Bancorp and Mercer Savings Bank**

The following table sets forth information regarding the executive officers of Mercer Bancorp. Age information is at December 31, 2022. The executive officers are elected annually by the board of directors.

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| | | |
|:---|:---|:---|
| **Name** | **Age** | **Position** |
| Barry Parmiter | 52 | President and Chief Executive Officer |

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**Directors of Mercer Bancorp and Mercer Savings Bank**

Mercer Bancorp has six directors. Directors serve three-year staggered terms so that approximately one-third of the directors are elected at each annual meeting. After the conversion and stock offering, the directors of Mercer Savings Bank will be elected by Mercer Bancorp in its capacity as sole stockholder of Mercer Savings Bank. The following table sets forth information regarding our directors, including their ages at December 31, 2022 and the calendar years when they began serving as directors of Mercer Savings Bank.

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| | | | | |
|:---|:---|:---|:---|:---|
| **Name** | **Position(s) Held With Mercer Savings Bank** | **Age** | **Director<br> Since** | **Current Term<br> Expires** |
| Michael J. Boley | Director | 56 | 2022 | 2025 |
| Jose W. Faller | Director | 45 | 2018 | 2024 |
| Kristin M. Fee | Vice Chair of the Board of Directors | 47 | 2013 | 2025 |
| David L. Keiser | Chairman of the Board of Directors | 66 | 2014 | 2026 |
| Richard A. Mosier | Director | 69 | 2006 | 2024 |
| Barry Parmiter | Director, President and Chief Executive Officer | 52 | 2022 | 2026 |

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Mr. Mosier plans to retire from the board of directors in January 2024 and we are initiating a search for his replacement.

**Board Independence**

Mercer Bancorp has determined to adopt the standards for "independence" for purposes of board and committee service as set forth in the listing standards of the Nasdaq Stock Market. The board of directors has determined that each director, except for Mr. Parmiter, is "independent" as defined in the listing standards of the Nasdaq Stock Market. Mr. Parmiter is not considered independent because he serves as an executive officer of Mercer Bancorp and Mercer Savings Bank.

To our knowledge, there are no other transactions between us and any director or entity controlled by any director which would interfere with the directors' exercise of independent judgment in carrying out their responsibilities as a director.

**Business Background of Our Directors and Executive Officers**

Our board of directors is comprised of local business and community leaders. The business experience for the past five years of each of our directors is set forth below. With respect to directors, the biographies also contain information regarding the person's experience, qualifications, attributes or skills that caused the board of directors to determine that the person should serve as a director. Unless otherwise indicated, directors have held their positions for the past five years.

***Michael J. Boley*** is the President and Chief Executive Officer of Wabash Mutual Telephone Company, a customer-owned broadband communications company headquartered in Celina, Ohio, and its subsidiary, Wabash Communications, Inc., which offers a wireless broadband network in Mercer County and surrounding areas. Mr. Boley also serves as a trustee of the Ohio Rural Broadband Association and is a member of the board of directors of Com Net Inc. and Independents Fiber Network. Mr. Boley's extensive business and community network and insight into the local economic environment are valuable assets to the board of directors.

***Jose W. Faller*** is the Director of Human Resources and Technology at Cooper Farms, a farm and food company based in northwest Ohio. Mr. Faller joined Cooper Farms in 2002. Previously, he worked as a network administrator for the U.S. Army. Mr. Faller also served as a member of the Fort Recovery Local Schools Board of Education from 2012 to 2019. Mr. Faller is a graduate of the University of Dayton with a bachelor's degree in exercise science and holds an MBA from Wright State University. Mr. Faller brings valuable management experience and unique information technology expertise to the board of directors.

***Kristin M. Fee*** is the Vice Chair of the board of directors of Mercer Savings Bank. Ms. Fee is the owner of Tribute Funeral Homes with locations in Greenville, Madison and Fort Recovery, Ohio. She has also served as Executive Director of EUM Church in Greenville, Ohio since 2010. Ms. Fee is a graduate of the University of Dayton and the World Harvest Bible College. Ms. Fee's experience in marketing, operations and human resources and community connections are a valuable asset to the board of directors.

***David L. Keiser*** serves as Chairman of the board of directors of Mercer Savings Bank, a position he has held since 2021. He is an owner and the President of Littman Thomas Insurance Agency, Inc., which serves Darke County, Ohio and surrounding areas. He has served as a member of the board of directors of several non-profit organizations, including Boys & Girls Club, Darke County Chamber Ambassador, Darke County United Way and Darke County Economic Development. Mr. Keiser's extensive business and community network and insight into the local economic environment are valuable assets to the board of directors.

***Richard A. Mosier*** joined the Board of Directors of Mercer Savings Bank in 2006 and served as Chairman of the Board from 2012 to 2021. Until his retirement in 2018, Mr. Mosier was an owner of and Certified Public Accountant at Mosier & Byers, CPAs LLC, which offers tax and accounting services to individuals and small businesses in Mercer County and surrounding areas. Mr. Mosier's extensive institutional knowledge of Mercer Savings Bank and his background as a CPA are a significant resource for the board of directors. Mr. Mosier plans to retire from the board of directors in January 2024.

***Barry Parmiter*** has served as President and Chief Executive Officer of Mercer Savings Bank since February 2022. Previously, he served as the President and Chief Executive Officer of Community Savings, Caldwell, Ohio, from 1998 to February 2022. Mr. Parmiter is a graduate of Ohio University with a Bachelor of Business Administration with a focus on accounting and holds an MBA from The University of Findlay. Mr. Parmiter provides the board with a perspective on the day-to-day operations of Mercer Savings Bank and assists the board in assessing the trends and developments in the financial institutions industry on a local and national basis. Additionally, Mr. Parmiter has business relationships and community ties that support our business generation.

**Meetings and Committees of the Board of Directors of Mercer Bancorp and Mercer Savings Bank**

We conduct business through meetings of our board of directors and its committees. The board of directors of Mercer Bancorp will establish standing committees, including an Audit Committee. Each of these committees will operate under a written charter, which will govern its composition, responsibilities and operations. Mercer Savings Bank also has standing committees of its board of directors.

Our Audit Committee will initially consist of Directors Keiser, Mosier and Fee.

**Corporate Governance Policies and Procedures**

In addition to establishing committees of our board of directors, we expect to adopt several policies to govern the activities of both Mercer Bancorp and Mercer Savings Bank including corporate governance policies and a code of business conduct and ethics. The corporate governance policies are expected to involve such matters as the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the composition, responsibilities
 and operation of our board of directors;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the establishment and
 operation of board committees, including audit, nominating/corporate governance and compensation
 committees;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· convening executive
 sessions of independent directors; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· our board of directors'
 interaction with management and third parties.

The code of business conduct and ethics, which is expected to apply to all employees and directors, will address conflicts of interest, the treatment of confidential information, general employee conduct and compliance with applicable laws, rules and regulations. In addition, the code of business conduct and ethics will be designed to deter wrongdoing and to promote honest and ethical conduct, the avoidance of conflicts of interest, full and accurate disclosure and compliance with all applicable laws, rules and regulations.

**Transactions With Certain Related Persons**

***Loans and Extensions of Credit.*** Federal law generally prohibits publicly traded companies from making loans and extensions of credit to their executive officers and directors, but it contains a specific exemption from such prohibition for loans made by federally insured financial institutions, such as Mercer Savings Bank, to their executive officers and directors in compliance with federal banking regulations. Federal regulations permit executive officers and directors to receive the same terms that are widely available to other employees as long as the director or executive officer is not given preferential treatment compared to the other participating employees.

Mercer Savings Bank makes loans to its employees and directors through an employee loan program pursuant to which loans are made at a reduced rate. Mortgage loans on a personal residence are available at 1.00% above Mercer Savings Bank's cost of funds, adjusted annually, with the privilege limited to one outstanding loan per individual; consumer loans are available at 2.00% below the interest rate then offered to the public, but can never be less than 1.00% above Mercer Savings Bank's cost of funds at the time the loan is granted, with the privilege limited to two outstanding loans per individual; and home equity lines of credit are available at the U.S. Prime Rate as published in *The Wall Street Journal*, adjusted as any changes to the U.S. Prime Rate occur, with the privilege limited to one outstanding loan per individual. The chart below lists our directors and executive officers who participated in the employee loan program during the years ended September 30, 2022 and 2021, and certain information with respect to their loans.

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **Name** | **Type of Loan** | **Largest<br> Aggregate<br> Balance<br> 10/1/21 to<br> 9/30/22** | **Principal<br> Balance<br> 9/30/22** | **Principal Paid<br> 10/1/21 to<br> 9/30/22** | **Interest Paid**<br> **10/1/21 to 9/30/22** | **Interest<br> Rate** |
| Gregory Bruns (1) | Home equity line of credit | $— | $— | $— | $— | 6.250% |
| Gregory Bruns | Home mortgage | $246556 | $237682 | $8874 | $3126 | 1.189% |
| Jose W. Faller | Home mortgage | $167448 | $161165 | $6283 | $2117 | 1.201% |
| Jose W. Faller | Home equity line of credit | $— | $— | $— | $— | 6.250% |
| Jon Fee (2) | Home mortgage | $112018 | $— | $112018 | $997 | 1.298% |
| Jon Fee | Home mortgage | $346757 | $346757 | $3243 | $1637 | 1.189% |
| Kristen M. Fee | Automobile loan | $45180 | $36532 | $8647 | $581 | 1.409% |
| Kristen M. Fee | Automobile loan | $28129 | $— | $28129 | $168 | 1.409% |
| David L. Keiser | Home equity line of credit | $— | $— | $— | $— | 6.250% |
| David L. Keiser | Home mortgage | $60937 | $52070 | $8866 | $734 | 1.189% |

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| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **Name** | **Type of Loan** | **Largest<br> Aggregate<br> Balance<br> 10/1/20 to <br> 9/30/21** | **Principal<br> Balance<br> 9/30/21** | **Principal Paid<br> 10/1/20 to<br> 9/30/21** | **Interest Paid<br> 10/1/20 to<br> 9/30/21** | **Interest<br> Rate** |
| Gregory Bruns (1) | Home equity line of credit | $— | $— | $— | $— | 3.25% |
| Gregory Bruns | Home mortgage | $254870 | $246555 | $8314 | $3685 | 1.298% |
| Jose W. Faller | Home mortgage | $170000 | $167448 | $2552 | $1113 | 1.346% |
| Jose W. Faller | Home equity line of credit | $10545 | $— | $10545 | $13 | 3.250% |
| Jose W. Faller | Home equity line of credit | $1715 | $— | $1715 | $18 | 4.250% |
| Jose W. Faller | Home mortgage | $174447 | $— | $174447 | $2536 | 2.875% |
| Jon Fee (2) | Home mortgage | $116321 | $112018 | $4303 | $1679 | 1.409% |
| Kristen M. Fee | Automobile loan | $53000 | $45180 | $7820 | $639 | 1.409% |
| Kristen M. Fee | Automobile loan | $33000 | $28129 | $3990 | $321 | 3.250% |
| David L. Keiser | Home equity line of credit | $— | $— | $— | $— | 3.250% |
| David L. Keiser | Home mortgage | $69573 | $60937 | $8636 | $964 | 1.298% |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Mr. Bruns resigned as Senior Vice President of Lending effective March 3, 2023.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Mr. Fee is Ms. Fee's husband.

All of our loans to directors and executive officers were made in the ordinary course of business and, except for the discounted rates described above, were made on substantially the same terms, including collateral, as those prevailing at the time for comparable loans with persons not related to Mercer Savings Bank, and did not involve more than the normal risk of collectability or present other unfavorable features. These loans were performing according to their original terms at December 31, 2022, and were made in compliance with federal banking regulations.

**Executive Compensation**

***Summary Compensation Table.*** The following information is furnished for our principal executive officer and the next most highly compensated executive officer (other than the principal executive officer) whose total compensation exceeded $100,000 for the year ended September 30, 2022. These individuals are sometimes referred to in this prospectus as the "named executive officers."

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Name and Principal Position** | **Year** | **Salary** | **Bonus** | **All Other Compensation** | **Total** |
| Barry Parmiter <br>President and Chief Executive Officer | 2022 | $99375 |  |  | $99375 |
| Gregory Bruns <sup>(1)</sup><br> *Senior Vice President of Lending* | 2022 | $94393 | $10000 | $6685 | $111078 |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Mr. Bruns resigned as Senior Vice President of Lending effective March 3, 2023.

***Employment Agreement.*** Mercer Savings Bank has entered into an employment agreement with Barry Parmiter, our President and Chief Executive Officer. Our continued success depends to a significant degree on the skills and competence of Mr. Parmiter and the employment agreement is intended to ensure that we maintain a stable management base following the conversion and offering.

The employment agreement has a term of three years. Commencing as of each January 1, the board of directors may renew the agreement for an additional year so that the remaining term will again become three years. The current base salary for Mr. Parmiter is $195,000. In addition to base salary, the agreement provides for, among other things, participation in bonus programs and other benefit plans and arrangements applicable to executive and other employees. We may terminate Mr. Parmiter's employment for cause at any time, in which event he would have no right to receive compensation or other benefits for any period after his termination of employment.

Certain events resulting in Mr. Parmiter's termination or resignation entitle him to payments of severance benefits following the termination of his employment. In the event of Mr. Parmiter's involuntary termination for reasons other than for cause, disability or retirement, or in the event he resigns during the term of the agreement following (a) the failure to appoint him to the executive position set forth in the agreement or the failure to re-nominate him as a member of the board of directors, (b) a material change in his function, duties or responsibilities resulting in a reduction of the responsibility, scope, or importance of his position, (c) a relocation of his office by more than 30 miles, (d) a material reduction in the benefits or perquisites paid to him unless the reduction is part of a reduction that is generally applicable to employees of Mercer Savings Bank, (e) a liquidation or dissolution of Mercer Savings Bank or (f) a material breach of the employment agreement by Mercer Savings Bank, then Mr. Parmiter would become entitled to a severance payment in the form of a cash lump sum equal to the base salary and bonuses he would have earned for the remaining unexpired term of the employment agreement. In addition, Mr. Parmiter would become entitled, at no expense to him, to the continuation of life insurance and non-taxable medical and dental coverage for the remaining unexpired term of the employment agreement, or if the coverage is not permitted by applicable law or if providing the benefits would subject Mercer Savings Bank to penalties, he will receive a cash lump sum payment equal to the value of the benefits.

In the event of a change in control of Mercer Savings Bank or Mercer Bancorp followed by Mr. Parmiter's involuntary termination other than for cause, disability or retirement, or upon his resignation for one of the reasons set forth above thereafter, he would become entitled to a severance payment in the form of a cash lump sum equal to three times his "base amount," as that term is defined for purposes of Internal Revenue Code Section 280G (*i.e.*, the average annual taxable income paid to him for the five taxable years preceding the taxable year in which the change in control occurs). In addition, Mr. Parmiter would become entitled, at no expense to him, to the continuation of life insurance and non-taxable medical and dental coverage for twenty-four (24) months following his termination of employment, or if the coverage is not permitted by applicable law or if providing the benefits would subject Mercer Savings Bank to penalties, he will receive a cash lump sum payment equal to the value of the benefits.

Under the employment agreement, if Mr. Parmiter becomes disabled within the meaning of the term under Section 409A of the Internal Revenue Code and as set forth in the employment agreement, he will receive benefits under any short-term or long-term disability plans maintained by Mercer Savings Bank.

Under the employment agreement, if Mr. Parmiter retires following his attainment of age 65, he will receive benefits under any applicable retirement or other plans maintained by Mercer Savings Bank.

In the event of Mr. Parmiter's death, his estate or beneficiaries will be paid his base salary through the end of the month in which his death occurs and his dependents will be entitled to continued non-taxable medical, dental and other insurance for one year following his death.

Upon termination of Mr. Parmiter's employment (other than following a change in control), he will be subject to certain restrictions on his ability to compete or to solicit business or employees of Mercer Savings Bank for a period of one year following his termination of employment.

***401(k) Plan.*** Mercer Savings Bank maintains the Mercer Savings Bank Profit Sharing & 401(k) Savings Plan & Trust, a tax-qualified defined contribution plan for eligible employees (the "401(k) Plan"). The named executive officers are eligible to participate in the 401(k) Plan on the same terms as other eligible employees. Eligible employees become participants in the 401(k) Plan and may make salary deferrals and receive employer contributions under the plan after having attained age 21 and completing one year of service.

Under the 401(k) Plan, a participant may elect to defer, on a pre-tax basis, the maximum amount of compensation permitted by the Internal Revenue Code. For 2023, the salary deferral contribution limit is $22,500, provided, however, that a participant over age 50 may contribute an additional $7,500 to the 401(k) Plan for a total of $30,000. In addition to salary deferral contributions, Mercer Savings Bank currently makes matching contributions on the first 6% of the participant's compensation under the plan. It may also make other discretionary contributions to the 401(k) Plan.

A participant is always 100% vested in his or her salary deferral contributions. A participant will vest in matching and other employer contributions at the rate of 100% after three years of service. Generally, unless the participant elects otherwise, the participant's account balance will be distributed following the participant's termination of employment. However, participants may take in-service withdrawals from the 401(k) Plan in certain circumstances, including for loans and hardships.

Expense recognized in connection with the 401(k) Plan totaled approximately $50,180 for the year ended September 30, 2022.

***Employee Stock Ownership Plan*.** Mercer Savings Bank intends to adopt an employee stock ownership plan, effective January 1, 2023, for eligible employees. It is anticipated that eligible employees will include employees who have attained age 21 and have completed one year of service. Employees employed as of January 1, 2023, will begin participation in the employee stock ownership plan on the later of the effective date of the employee stock ownership plan or upon the first entry date commencing on or after the eligible employee's completion of one year of service.

The employee stock ownership plan trustee is expected to purchase, on behalf of the employee stock ownership plan, 8% of the total number of shares of Mercer Bancorp common stock sold in the stock offering and contributed to the charitable foundation. We anticipate that the employee stock ownership plan will fund its stock purchase with a loan from Mercer Bancorp equal to the aggregate purchase price of the common stock. The loan will be repaid principally through Mercer Savings Bank' contribution to the employee stock ownership plan and dividends payable on common stock held by the employee stock ownership plan over the anticipated 15-year term of the loan. The interest rate for the employee stock ownership plan loan is expected to be a fixed-rate equal to the prime rate, as published in *The Wall Street Journal*, on the closing date of the conversion and stock offering. If market conditions warrant, in the judgment of its trustees, the employee stock ownership plan's subscription order will not be filled and the employee stock ownership plan may elect to purchase shares in the open market following the completion of the conversion and stock offering, subject to applicable regulatory approvals or non-objections.

The trustee will hold the shares purchased by the employee stock ownership plan in an unallocated suspense account. Shares will be released from the suspense account on a pro-rata basis as the trustee repays the loan. The trustee will allocate the shares released among the participants' accounts based on each participant's proportional share of compensation relative to all participants. Participants will vest in their benefit after completing three years of service, with no vesting prior to completing three years of service. Participants who were employed by Mercer Savings Bank immediately before the completion of the conversion and stock offering will receive credit for vesting purposes for years of service before adoption of the employee stock ownership plan. Participants also will become fully vested upon normal retirement, death or disability, a change in control, or termination of the employee stock ownership plan. Generally, participants will receive distributions from the employee stock ownership plan upon severance from employment. The employee stock ownership plan reallocates any unvested shares forfeited upon termination of employment among the remaining participants.

The employee stock ownership plan will permit participants to direct the trustee as to how to vote the shares of common stock allocated to their accounts. The trustee will vote unallocated shares and allocated shares for which participants do not provide instructions on any matter in the same ratio as those shares for which participants provide instructions, subject to fulfillment of the trustee's fiduciary responsibilities.

Under applicable accounting requirements, Mercer Savings Bank will record a compensation expense for the employee stock ownership plan at the fair market value of the shares as they are committed to be released from the unallocated suspense account to participants' accounts. The compensation expense resulting from the release of Mercer Bancorp common stock from the suspense account and allocation to plan participants will result in a corresponding reduction in the earnings of Mercer Bancorp.

**Directors' Compensation**

The following table sets forth for the year ended September 30, 2022, certain information as to the total remuneration we paid to our non-employee directors.

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| | | | |
|:---|:---|:---|:---|
| **Name** | **Fees Earned or<br> Paid in Cash** | **All Other<br> Compensation** | **Total** |
| Michael J. Boley <sup>(1)</sup> | $8100 | – $| 8100 |
| Jose W. Faller | 16000 | – | 16000 |
| Kristin M. Fee | 13600 | – | 13600 |
| David L. Keiser | 17500 | – | 17500 |
| Thomas D. Lammers <sup>(2)</sup> | 12450 | – | 12450 |
| Richard A. Mosier | 13600 | – | 13600 |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Mr. Boley joined the Board of Directors
 on April 19, 2022.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Mr. Lammers passed away on September 3,
 2022.

***Director Fees.*** Directors of Mercer Savings Bank receive a monthly fee of $1,350 for directors not participating in a Director Retirement Agreement or $1,150 for directors who participate in a Director Retirement Agreement. The Chairman, or the Vice Chairman in the absence of the Chairman, receives an additional fee of $350 per month and the Secretary receives an additional fee of $250 per month. Employees who serve on the board of directors do not receive director fees. No additional fees are paid for attending meetings of the Board of Directors or of its committees.

Each individual who serves as a director of Mercer Savings Bank also serves as a director of Mercer Bancorp. Initially, each director will receive director fees only in their capacity as a director of Mercer Savings Bank. Following the completion of the conversion and stock offering, Mercer Bancorp may also determine to pay director fees but has not determined to do so at this time.

***Director Retirement Agreements.*** Mercer Savings Bank has entered into Director Retirement Agreements with Messrs. Mosier and Keiser and Ms. Fee. Under the Director Retirement Agreements, each director is entitled to a normal retirement benefit based on a schedule attached to the agreements. The annual normal retirement benefit for Messrs. Mosier and Keiser equals $18,736 and $12,937, respectively, and the annual normal retirement benefit for Ms. Fee equals $35,476. The normal retirement age for Messrs. Mosier and Keiser is 70 and 72, respectively, and the normal retirement age for Ms. Fee is 71. The directors vest in their benefits under the Director Retirement Agreements at the rate of 33% after six years of service, 66% after ten years of service and 100% after 18 years of service. The normal retirement benefit is paid monthly for ten years. Directors become 100% vested in their normal retirement benefit upon becoming disabled and receive the benefit in the same form as the normal retirement benefit but commencing on the first day of the month following their disability.

If the director separates from service prior to their normal retirement age, they become entitled to a lump sum payment equal to the amount set forth on a schedule to the agreements within 60 days following their separation from service. If the director separates from service within 24 months of a change in control, the director will fully vest in the normal retirement benefit and receive the benefit in a lump sum within 60 days following their separation from service. If a director dies while in service, the director's beneficiary will receive 100% of the normal retirement benefit, paid monthly for ten years. If the director dies while in pay-status under the agreements, the director's beneficiary will receive the same benefits the director would have received had the director survived.

In connection with the conversion, Mercer Savings Bank is amending the Director Retirement Agreements with Mr. Keiser and Ms. Fee to convert the agreements to a defined contribution form of benefit with the initial account balance equal to the accrual balance of the directors' current benefit. Each year, Mercer Savings Bank will then contribute an additional amount to the agreements on behalf of Mr. Keiser and Ms. Fee with the intent that the account balance will equal what was the anticipated accrual balance prior to the amendment (i.e., so that the directors will receive the same benefit equivalent after the amendment to the agreements prior to any adjustment for earnings on the account balances). The amendments are intended to allow Mr. Keiser and Ms. Fee to invest their current account balance in stock of Mercer Bancorp by making a one-time election to use the account balance to subscribe for shares in the offering.

**Benefits to be Considered Following Completion of the Conversion and Stock Offering**

***Stock-Based Benefit Plans.*** Following the conversion and stock offering, we intend to adopt one or more new stock-based benefit plans that will provide for grants of stock options and restricted stock awards (including restricted stock units). The stock-based benefit plans will not be adopted sooner than six months after the conversion and stock offering, and, if adopted within 12 months after the conversion and stock offering, stockholders must approve the plans by a majority of the votes eligible to be cast. If the stock-based benefit plans are established more than 12 months after the conversion and stock offering, stockholders must approve the plans by a majority of votes cast. Also, if adopted within 12 months following the completion of the conversion, the aggregate number of shares reserved for the exercise of stock options or available for stock awards under the stock-based benefit plans would be limited to 10% and 4%, respectively, of the shares sold in the stock offering and contributed to the charitable foundation.

The following additional restrictions would apply to our stock-based benefit plans if we adopt such plans within 12 months after the conversion and stock offering:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· non-employee directors
 in the aggregate may not receive more than 30% of the options and restricted stock awards
 authorized under the plans;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· any one non-employee
 director may not receive more than 5% of the options and restricted stock awards authorized
 under the plans;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· any officer or employee
 may not receive more than 25% of the options and restricted stock awards authorized under
 the plans;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· any tax-qualified employee
 stock benefit plans and restricted stock plans, in the aggregate, may not acquire more than
 10% of the shares sold in the stock offering and contributed to the charitable foundation,
 unless Mercer Savings Bank has tangible capital of 10% or more, in which case tax-qualified
 employee stock benefit plans and restricted stock plans may acquire up to 12% of the shares
 sold in the stock offering and contributed to the charitable foundation;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the options and restricted
 stock awards may not vest more rapidly than 20% per year, beginning on the first anniversary
 of stockholder approval of the plans; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· accelerated vesting
 is not permitted except for death, disability or upon a change in control of Mercer Bancorp
 or Mercer Savings Bank.

We have not determined whether we will present stock-based benefit plans for stockholder approval before or after 12 months after the completion of the conversion and stock offering.

We may obtain the shares needed for our stock-based benefit plans by issuing additional shares of common stock from authorized but unissued shares or through stock repurchases.

The actual value of the shares awarded under stock-based benefit plans would be based in part on the price of the common stock of Mercer Bancorp when the shares are awarded. The following table presents the total value of all shares of restricted stock that would be available for issuance under the new stock-based benefit plans, assuming the shares are awarded when the market price of our common stock ranges from $8.00 per share to $14.00 per share.

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| | | | | |
|:---|:---|:---|:---|:---|
| **Share Price** | **Value of Shares Awarded<br> at Minimum of Offering Range** | **Value of Shares Awarded<br> at Midpoint of Offering Range** | **Value of Shares Awarded<br> at Maximum of Offering Range** | **Value of Shares Awarded<br> at Adjusted Maximum of Offering Range** |
| **(In thousands, except share price information)** | **(In thousands, except share price information)** | **(In thousands, except share price information)** | **(In thousands, except share price information)** | **(In thousands, except share price information)** |
| $8.00 | $369600 | $432000 | $494400 | $566160 |
| 10.00 | 462000 | 540000 | 618000 | 707700 |
| 12.00 | 554400 | 648000 | 741600 | 849240 |
| 14.00 | 646800 | 756000 | 865200 | 990780 |

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The grant-date fair value of the options granted under the new stock-based benefit plans will be based in part on the price of shares of common stock of Mercer Bancorp when the options are granted. The value also will depend on the various assumptions utilized in the option pricing model ultimately adopted. The following table presents the total estimated value of the options to be available for grant under the stock-based benefit plans, assuming the market price and exercise price for the stock options are equal and the range of market prices for the shares is $8.00 per share to $14.00 per share. The Black-Scholes option pricing model provides an estimate only of the fair value of the stock options, and the actual value of the stock options may differ significantly from the value set forth in this table.

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Exercise Price** | **Grant-Date Fair<br> Value Per Option** | **Value of Options at<br> Minimum of<br> Offering Range** | **Value of Options at<br> Midpoint of<br> Offering Range** | **Value of Options at<br> Maximum of<br> Offering Range** | **Value of Options at<br> Adjusted Maximum of<br> Offering Range** |
| **(In thousands, except exercise price and fair value information)** | **(In thousands, except exercise price and fair value information)** | **(In thousands, except exercise price and fair value information)** | **(In thousands, except exercise price and fair value information)** | **(In thousands, except exercise price and fair value information)** | **(In thousands, except exercise price and fair value information)** |
| $8.00 | $2.97 | $343035 | $400950 | $458865 | $525467 |
| 10.00 | 3.72 | 429660 | 502200 | 574740 | 658161 |
| 12.00 | 4.46 | 515130 | 602100 | 689070 | 789086 |
| 14.00 | 5.20 | 600600 | 702000 | 803400 | 920010 |

---

**The above tables are provided for informational purposes only. There can be no assurance that our stock price will not trade below the offering price of $10.00 per share. Before you make an investment decision, we urge you to read this prospectus carefully, including, but not limited to, the section entitled "Risk Factors."**

**SUBSCRIPTIONS BY DIRECTORS AND EXECUTIVE OFFICERS**

The following table sets forth information regarding intended common stock subscriptions by each of the directors and executive officers and their associates, and by all directors, officers and their associates as a group. However, there can be no assurance that any such person or group will purchase any specific number of shares of our common stock. If the individual maximum purchase limitation is increased, persons subscribing for the maximum amount may increase their purchase order. Directors and officers will purchase shares of common stock at the same $10.00 purchase price per share and on the same terms as other purchasers in the stock offering. This table excludes shares of common stock to be purchased by the employee stock ownership plan, as well as any stock awards or stock option grants that may be made no earlier than six months after the completion of the conversion and stock offering. Purchases by directors, officers and their associates will be included in determining whether the required minimum number of shares has been subscribed for in the stock offering. The shares being acquired by the directors, executive officers and their associates are being acquired for investment purposes, and not with a view towards resale. Our directors and executive officers will be subject to the same minimum purchase requirements and purchase limitations as other participants in the stock offering set forth under "The Conversion and Stock Offering – Limitations on Common Stock Purchases."

---

| | | | | |
|:---|:---|:---|:---|:---|
| **Name** | **Title** | **Number of Shares <sup>(1)</sup>**  | **Aggregate Purchase Price <sup>(1)</sup>**  | **Percent at Minimum of Offering Range <sup>(2)</sup>** |
| Michael J. Boley | &nbsp;&nbsp;Director | 15000 | $150000 | 1.5% |
| Jose W. Faller | &nbsp;&nbsp;Director | 7000 | 70000 | \* |
| Kristin M. Fee | &nbsp;&nbsp;Director | 6000 | 60000 | \* |
| David L. Keiser | &nbsp;&nbsp;Director | 10000 | 100000 | \* |
| Richard A. Mosier | &nbsp;&nbsp;Director | 10000 | 100000 | \* |
| Barry Parmiter | &nbsp;&nbsp;Director, President and Chief Executive Officer | 17500 | 175000 | 1.5 |
| All directors and executive officers as a group (6 persons) |  | 65500 | $655000 | 5.7% |

---

\* Less than 1.0%

(1) Includes purchases by the named individual's spouse and other relatives of the named individual living in the same household.
Other than as set forth above and noted below, the named individuals are not aware of any other purchases by a person or entity that would
be considered an associate of the named individuals under the plan of conversion.

(2) Represents percentage of total outstanding shares at the minimum of the offering range, including shares contributed to the charitable
foundation.

**THE CONVERSION AND STOCK OFFERING**

The board of directors of Mercer Savings Bank has approved the plan of conversion. The plan of conversion provides for the establishment and funding of the charitable foundation. The plan of conversion must also be approved by Mercer Savings Bank's members (its depositors and borrowers). The establishment and funding of the charitable foundation must also be approved by Mercer Savings Bank's members, by a separate vote. A special meeting of members has been called for this purpose. Mercer Savings Bank has filed an application with respect to the conversion and stock offering with the ODFI and the FDIC, and Mercer Bancorp will file a holding company application with the Federal Reserve Board. The approvals of the ODFI, the FDIC and the Federal Reserve Board are required before we can consummate the conversion and stock offering. Any approval by the ODFI, the FDIC or the Federal Reserve Board does not constitute a recommendation or endorsement of the plan of conversion.

**General**

The board of directors of Mercer Savings Bank adopted and approved the plan of conversion on March 3, 2023. In accordance with the plan of conversion, Mercer Savings Bank will convert from the mutual form of organization to the stock form of organization. In connection with the conversion, Mercer Savings Bank has organized a new Maryland stock holding company named Mercer Bancorp, which will sell shares of common stock to the public in an initial public stock offering. When the conversion and stock offering are completed, all of the capital stock of Mercer Savings Bank will be owned by Mercer Bancorp, and all of the common stock of Mercer Bancorp will be owned by its stockholders.

Mercer Bancorp expects to retain between $3.6 million and $5.3 million of the net proceeds of the stock offering, or $6.2 million if the offering range is increased by 15% because of demand for the shares or changes in market conditions. Mercer Savings Bank will receive a capital contribution equal to at least 50% of the net proceeds of the stock offering. Based on this formula, we anticipate that Mercer Bancorp will invest in Mercer Savings Bank $4.7 million, $5.6 million, $6.6 million and $7.7 million, respectively, of the net proceeds at the minimum, midpoint, maximum and adjusted maximum of the offering range. The conversion and stock offering will be consummated only upon the sale of at least 1,105,000 shares of our common stock.

The plan of conversion provides that we will offer shares of common stock for sale in the subscription offering to Eligible Account Holders, our tax-qualified employee benefit plans (specifically our employee stock ownership plan), and Other Members (each as defined below). If all shares are not subscribed for in the subscription offering, we may, in our discretion, offer common stock for sale in a community offering to members of the public, with a preference given to natural persons (and trusts of natural persons) residing in Mercer and Darke Counties in Ohio and Adams and Jay Counties in Indiana. In addition, shares of common stock not purchased in the subscription offering and community offering may be offered for sale to the general public in a syndicated community offering to be managed by Performance Trust, acting as our agent.

We have the right to accept or reject, in whole or in part, any orders to purchase shares of the common stock received in any community offering or any syndicated community offering. The community offering and/or syndicated community offering, if any, may begin at the same time as, during, or after the subscription offering, and must be completed within 45 days after the completion of the subscription offering unless otherwise extended by us with the approval of the ODFI and FDIC. See " – Community Offering" and " – Syndicated Community Offering."

We determined the number of shares of common stock to be offered in the stock offering based upon an independent valuation of the estimated consolidated pro forma market value of Mercer Bancorp, assuming the conversion and stock offering are completed. All shares of common stock to be sold in the stock offering will be sold at $10.00 per share. Investors will not be charged a commission to purchase shares of common stock. The independent valuation will be updated and the final number of the shares of common stock to be issued in the stock offering will be determined at the completion of the stock offering. See " – Determination of Share Price and Number of Shares to be Issued" for more information as to the determination of the estimated pro forma market value of the common stock.

The following is a brief summary of the plan of conversion. We recommend reading the plan of conversion in its entirety for more information. A copy of the plan of conversion is available for inspection at the banking office of Mercer Savings Bank and as described in the section of this prospectus entitled "Where You Can Find Additional Information." The plan of conversion is also filed as an exhibit to Mercer Savings Bank's application for approval to convert from mutual to stock form, of which this prospectus is a part, copies of which may be obtained from the FDIC. The plan of conversion is also filed as an exhibit to Mercer Bancorp's registration statement filed with the Securities and Exchange Commission, of which this prospectus is a part, copies of which may be obtained from the Securities and Exchange Commission or online at the Securities and Exchange Commission's website, *www.sec.gov*. See "Where You Can Find Additional Information."

**Reasons for the Conversion**

Consistent with our business strategy, our primary reasons for converting and raising additional capital through the stock offering are:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· to increase capital to support future growth and profitability;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· to retain and attract qualified personnel by establishing stock-based benefit plans for management and employees;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· to offer our customers and employees an opportunity to purchase an equity interest in Mercer Savings Bank by purchasing shares of
common stock of Mercer Bancorp; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· to support and enhance Mercer Savings Bank's charitable giving in its local community.

Mutual institutions cannot offer stock incentives to attract and retain highly qualified management personnel. While Mercer Savings Bank has not required these capital tools and stock incentives in the past, they could prove to be important to implementing our business strategy, and management believes that the additional capital raised in the stock offering will enable us to take advantage of business opportunities that may not otherwise be available to us.

**Approvals Required**

The affirmative vote of two-thirds of the total eligible votes of members of Mercer Savings Bank is required to approve the plan of conversion. The affirmative vote of a majority of the total eligible votes of members of Mercer Savings Bank is required to approve the establishment and funding of the charitable foundation. A special meeting of members to consider and vote upon the plan of conversion and the establishment and funding of the charitable foundation has been set for [special meeting date]. The plan of conversion also must be approved by the ODFI and the FDIC. Additionally, the Federal Reserve Board must approve Mercer Bancorp's holding company application. We cannot consummate the conversion and the stock offering without satisfying the conditions contained in these approvals.

**Effects of Conversion on Depositors, Borrowers and Members**

***Continuity.*** While the conversion is being accomplished, our normal business of accepting deposits and making loans will continue without interruption. Mercer Savings Bank will continue to be an Ohio state-chartered bank and will continue to be regulated by the FDIC, while Mercer Bancorp will be regulated by the Federal Reserve Board. After the conversion and stock offering, we will continue to offer existing services to depositors, borrowers and other customers. The individuals serving as directors of Mercer Savings Bank at the time of the conversion will serve as the directors of Mercer Savings Bank and of Mercer Bancorp after the conversion and stock offering.

***Effect on Deposit Accounts.*** According to the plan of conversion, each depositor of Mercer Savings Bank at the time of the conversion will automatically continue as a depositor after the conversion, and the deposit balance, interest rate and other terms of such deposit accounts will not change as a result of the conversion. Each such account will be insured by the FDIC to the same extent as before the conversion. Depositors will continue to hold their existing certificates, passbooks and other evidences of their accounts.

***Effect on Loans.*** No loan outstanding from Mercer Savings Bank will be affected by the conversion, and the amount, interest rate, maturity and security for each loan will remain as it was contractually fixed before the conversion.

***Effect on Voting Rights of Members.*** All of our depositors and borrowers are members of and have voting rights in Mercer Savings Bank as to all matters requiring membership action. Upon completion of the conversion, Mercer Savings Bank will cease to have members and former members will no longer have voting rights in Mercer Savings Bank. Upon completion of the conversion, all voting rights in Mercer Savings Bank will be vested in Mercer Bancorp as the sole stockholder of Mercer Savings Bank. The stockholders of Mercer Bancorp will possess exclusive voting rights with respect to Mercer Bancorp common stock.

***Tax Effects.*** We have received opinions of our counsel and our tax advisors with regard to the federal and state income tax consequences of the conversion to the effect that the conversion will not be taxable for federal or Ohio state income tax purposes to Mercer Savings Bank or its members. See " – Material Income Tax Consequences."

***Effect on Liquidation Rights.*** Each depositor of Mercer Savings Bank has both a deposit account in Mercer Savings Bank and a pro rata ownership interest in the net worth of Mercer Savings Bank based upon the deposit balance in the depositor's account. This ownership interest is tied to the depositor's account and has no tangible market value separate from the deposit account. This interest may only be realized in the event of a complete liquidation of Mercer Savings Bank. Any depositor who opens a deposit account obtains a pro rata ownership interest in Mercer Savings Bank without any additional payment beyond the amount of the deposit. A depositor who reduces or closes their account receives a portion or all, respectively, of the balance in the deposit account upon such withdrawal, but nothing in exchange for their ownership interest in the net worth of Mercer Savings Bank, which is lost to the extent that the balance in the account is reduced or closed.

Consequently, depositors in a mutual bank normally have no way of realizing the value of their ownership interest, which has realizable value only in the unlikely event that the institution is completely liquidated. If this occurs, the depositors of record at that time, as owners, would share pro rata in any residual surplus and reserves of Mercer Savings Bank after other claims, including claims of depositors to the amounts of their deposits, are paid.

In the unlikely event that Mercer Savings Bank were to liquidate after the conversion, all claims of creditors, including those of depositors, would be paid first, followed by distribution of a "liquidation account" to depositors as of February 28, 2022 who continue to maintain their deposit accounts as of the date of liquidation, with any assets remaining thereafter distributed to Mercer Bancorp as the sole owner of Mercer Savings Bank's capital stock. A post-conversion merger, consolidation, sale of bulk assets or similar combination or transaction with another insured savings institution would not be considered a liquidation and, in such a transaction, the liquidation account would be assumed by the surviving institution. See " – Liquidation Rights."

**Determination of Share Price and Number of Shares to be Issued**

The plan of conversion and federal regulations require that the aggregate purchase price of the common stock sold in the stock offering be based on the appraised pro forma market value of the common stock, as determined by an independent valuation. We have retained FinPro Capital Advisors, Inc. ("FinPro"), an independent appraisal firm, to prepare an independent valuation appraisal. For its services in preparing the initial valuation and one final update valuation, FinPro will receive a fee of $35,000, and will be reimbursed for its expenses up to $5,000.

We are not affiliated with FinPro, and neither we nor FinPro has an economic interest in, or is held in common with, the other. FinPro represents and warrants that it is not aware of any fact or circumstance that would cause it not to be "independent" within the meaning of the conversion regulations or the applicable regulatory valuation guidelines or otherwise prohibit or restrict in anyway FinPro from serving in the role of our independent appraiser.

We have agreed to indemnify FinPro and its employees and affiliates against specified losses, including any losses in connection with claims under the federal securities laws, arising out of its services as independent appraiser, except where such liability results from its gross negligence, bad faith or willful misconduct.

The independent valuation appraisal considered the pro forma impact of the stock offering. Consistent with applicable federal appraisal guidelines, the appraisal applied three primary methodologies: the pro forma price-to-book value approach applied to both reported book value and tangible book value; the pro forma price-to-earnings approach applied to reported and core earnings; and the pro forma price-to-assets approach. The market value ratios applied in the remaining two methodologies were based upon the current market valuations of the comparable group companies identified by FinPro, subject to valuation adjustments applied by FinPro to account for differences between us and our peer group. Because FinPro concluded that asset size is not a strong determinant of market value, FinPro did not place significant weight on the pro forma price-to-assets approach in reaching its conclusions. FinPro placed the greatest emphasis on the price-to-book value approach in estimating pro forma market value.

The independent valuation was prepared by FinPro in reliance upon the information contained in this prospectus, including our financial statements. FinPro also considered the following factors, among others:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· our present and projected operating results and financial condition;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the economic and demographic conditions in our existing market area;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· certain historical, financial and other information relating to us;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· a comparative evaluation of our operating and financial characteristics with those of other similarly situated publicly traded savings
institutions;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the impact of the conversion and stock offering on our equity and earnings potential; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the trading market for securities of comparable institutions and general conditions in the market for such securities.

The independent valuation is also based on an analysis of a peer group of twelve publicly traded bank and savings and loan holding companies that FinPro considered comparable to us under regulatory guidelines applicable to the independent valuation. Under these guidelines, a minimum of ten peer group companies are selected from the universe of all publicly traded savings institutions with relatively comparable resources, strategies and financial and other operating characteristics. Such companies must also be traded on an exchange (such as Nasdaq or the New York Stock Exchange). Because of the initial and continuing listing standards of Nasdaq and the New York Stock Exchange, including public float and round lot holders requirements, as well as the fact that many of the smaller converted thrifts ultimately de-list their shares from Nasdaq and/or are acquired by larger companies, each of the peer group companies has a comparatively larger asset size than Mercer Savings Bank. The peer group companies selected also consisted of fully converted stock institutions that were not subject to an actual or rumored acquisition and that had been in fully converted form for at least one year. In addition, the peer group companies were limited to the following selection criteria:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· selected all fully converted thrifts located in the Midwest, Northeast and Mid-Atlantic Regions;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· excluded institutions that have recently converted, as the earnings of newly converted institutions do not reflect a full year's
benefit from the reinvestment of proceeds, and thus the price/earnings multiples and return on equity measures for these institutions
tend to be skewed upward and downward, respectively;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· eliminated institutions with assets in excess of $2.25 billion as these entities have greater financial and managerial resources and
a broader branch network; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· eliminated minority focused institutions.

Included in the independent valuation were certain assumptions as to our pro forma earnings after the conversion that were utilized in determining the appraised value. These assumptions included estimated expenses, an assumed after-tax rate of return on the net offering proceeds of 3.95% and purchases in the open market of 4.0% of the common stock sold in the stock offering and contributed to the charitable foundation by the stock-based benefit plan at the $10.00 purchase price. See "Pro Forma Data" for additional information concerning these assumptions. The use of different assumptions may yield different results.

The independent valuation states that at February 28, 2023, the estimated pro forma market value of Mercer Bancorp ranged from $11.6 million to $15.5 million, with a midpoint of $13.5 million (including the value of the 50,000 shares of Mercer Bancorp common stock to be contributed to the charitable foundation at the offering price of $10.00 per share). Our board of directors decided to offer the shares of common stock for a price of $10.00 per share primarily because it is the price most commonly used in mutual-to-stock conversions of financial institutions. The number of shares offered for sale in the stock offering equals to the aggregate offering price of the shares divided by the price per share. Based on the valuation range and the $10.00 price per share, and excluding the 50,000 shares to be contributed to the charitable foundation, the minimum of the offering range is 1,105,000 shares, the midpoint of the offering range is 1,300,000 shares and the maximum of the offering range is 1,495,000 shares, or 1,719,250 shares if the maximum amount is increased by 15% because of demand for shares or changes in market conditions.

In applying each of the valuation methods, FinPro considered adjustments to our pro forma market value based on a comparison of Mercer Bancorp with the peer group. FinPro made downward adjustments for: financial condition, balance sheet growth, market area, and liquidity of the issue. FinPro made no upward adjustments. FinPro made no adjustments for earnings quality, predictability and growth, dividends, recent regulatory matters, management, and marketing of issuance. The downward adjustment for financial condition took into consideration smaller size of Mercer Savings Bank's balance sheet compared to the comparable group. The downward adjustment for balance sheet took into consideration the lower levels of percentage growth compared to the comparable group. The downward adjustment for Mercer Savings Bank's market area took into consideration the lower household income levels to the comparable group. The downward adjustment for liquidity took into consideration the lower size of the potential issuance compared to the comparable group.

The following table presents a summary of selected pricing ratios for the peer group companies and for Mercer Bancorp (on a pro forma basis) that FinPro utilized in its appraisal. These ratios are based on Mercer Bancorp's book value, tangible book value and core earnings as of and for the three months ended December 31, 2022, annualized. The peer group ratios are based on the latest date for which complete financial data are publicly available and stock prices as of February 17, 2022. Compared to the average pricing of the peer group, our pro forma pricing ratios at the midpoint of the offering range indicate a discount of 55.1% on a core earnings value basis, 41.1% on a price-to-book value basis and a discount of 42.1% on a price-to-tangible book value basis.

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| | | | |
|:---|:---|:---|:---|
|  | **Price-to-core earnings multiple <sup>(1)</sup>** | **Price-to-book value ratio** | **Price-to-tangible book value ratio** |
| **Mercer Bancorp (pro forma basis, assuming completion of the conversion and stock offering):** |  |  |  |
| &nbsp;&nbsp;&nbsp;Adjusted Maximum | 10.75 x | 63.49% | 63.49% |
| &nbsp;&nbsp;&nbsp;Maximum | 9.62 x | 59.67% | 59.67% |
| &nbsp;&nbsp;&nbsp;Midpoint | 8.62 x | 55.83% | 55.83% |
| &nbsp;&nbsp;&nbsp;Minimum | 7.58 x | 51.41% | 51.41% |
| **Valuation of peer group companies, all of which are fully converted (historical basis):** |  |  |  |
| &nbsp;&nbsp;&nbsp;Average | 33.40 x | 94.40% | 97.40% |
| &nbsp;&nbsp;&nbsp;Median | 19.20 x | 94.80% | 96.40% |

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(1) Price-to-earnings multiples calculated by FinPro are based on an estimate of "core" or recurring earnings. These ratios
are different from those presented in "Pro Forma Data."

The following table presents information regarding the peer group companies utilized by FinPro in its appraisal.

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| | | | | |
|:---|:---|:---|:---|:---|
| **Company Name** | <br>**Ticker Symbol** | **Exchange** | **Headquarters** | **Total Assets at December 31, 2022**<br> **($ in millions)** |
| 1895 Bancorp of Wisconsin, Inc. | BCOW | NASDAQCM | Greenfield, WI | 529317 |
| Blue Foundry Bancorp | BLFY | NASDAQGS | Rutherford, NJ | 2043338 |
| Finward Bancorp | FNWD | NASDAQCM | Munster, IN | 2070339 |
| First Seacoast Bancorp, Inc. | FSEA | NASDAQCM | Dover, NH | 523801 |
| Generations Bancorp NY, Inc. | GBNY | NASDAQCM | Seneca Falls, NY | 373612 |
| HMN Financial, Inc. | HMNF | NASDAQCM | Rochester, NY | 1096202 |
| Mid-Southern Bancorp, Inc. | MSVB | NASDAQCM | Salem, IN | 264548 |
| Northeast Community Bancorp, Inc. | NECB | NASDAQCM | White Plains, NY | 1425037 |
| PB Bankshares, Inc. | PBBK | NASDAQCM | Coatesville, PA | 376739 |
| Provident Bancorp, Inc. | PVBC | NASDAQCM | Amesbury, MA | 1636381 |
| Waterstone Financial, Inc. | WSBF | NASDAQGS | Wauwatosa, WI | 2031672 |
| William Penn Bancorporation | WMPN | NASDAQCM | Bristol, PA | 870944 |

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Our board of directors reviewed the independent valuation and, in particular, considered the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· our financial condition and results of operations;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· comparison of our financial performance ratios to those of other financial institutions of similar size; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· market conditions generally and, in particular, for financial institutions.

All of these factors are set forth in the independent valuation. Our board of directors also reviewed the methodology and the assumptions used by FinPro in preparing the independent valuation and believes that such assumptions were reasonable. The offering range may be amended with the approval of the FDIC, if required, as a result of subsequent developments in our financial condition or market conditions generally. If the independent valuation is updated to amend our pro forma market value to less than $11.6 million or more than $17.7 million (including the value of the 50,000 shares contributed to the charitable foundation), the appraisal will be filed with the Securities and Exchange Commission by a post-effective amendment to our registration statement.

**The independent valuation is not intended, and must not be construed, as a recommendation of any kind as to the advisability of purchasing shares of our common stock. FinPro did not independently verify our financial statements and other information that we provided to them, nor did FinPro independently value our assets or liabilities. The independent valuation considers Mercer Savings Bank as a going concern and should not be considered as an indication of its liquidation value. Moreover, because the valuation is necessarily based upon estimates and projections of a number of matters, all of which may change from time to time, no assurance can be given that persons purchasing our common stock in the stock offering will thereafter be able to sell their shares at prices at or above the $10.00 offering price per share.**

Following commencement of the subscription offering, the maximum of the valuation range may be increased by up to 15%, or up to $17.2 million, which would result in a corresponding increase of up to 15% in the maximum of the offering range to up to 1,719,250 shares, to reflect changes in the market and financial conditions or demand for the shares. We will not increase the offering range above this level or decrease the minimum of the offering range without a resolicitation of subscribers. The subscription price of $10.00 per share will remain fixed. See " – Limitations on Common Stock Purchases" as to the method of distribution and allocation of additional shares that may be issued in the event of an increase in the offering range to fill unfilled orders in the stock offering.

If the update to the independent valuation at the conclusion of the stock offering results in an increase in the maximum of the valuation range to more than $17.2 million, and a corresponding increase in the offering range to more than 1,719,250 shares, or a decrease in the minimum of the valuation range to less than $11.1 million and a corresponding decrease in the offering range to fewer than 1,105,000 shares, then we will promptly return, with interest at a rate of 0.05% per annum, all funds received in the stock offering and cancel deposit account withdrawal authorizations. After consulting with the ODFI and FDIC, we may terminate the plan of conversion. Alternatively, we may establish a new offering range and commence a resolicitation of subscribers or take other actions as permitted by the ODFI and FDIC in order to complete the conversion and stock offering. If we conduct a resolicitation, we will notify subscribers of their rights to place a new stock order for a specified period of time. If a person does not respond, we will cancel their stock order and return their subscription funds, with interest, and cancel any authorization to withdraw funds from deposit accounts for the purchase of shares of common stock. Any resolicitation following the conclusion of the subscription and community offerings would not exceed 45 days unless further extended with the approval, to the extent approval is required, of the ODFI and the FDIC, for periods of up to 90 days.

An increase in the number of shares to be issued in the stock offering would decrease both a subscriber's ownership interest and our pro forma earnings and stockholders' equity on a per share basis while increasing pro forma earnings and stockholders' equity on an aggregate basis. A decrease in the number of shares to be issued in the stock offering would increase both a subscriber's ownership interest and our pro forma earnings and stockholders' equity on a per share basis, while decreasing pro forma earnings and stockholders' equity on an aggregate basis. For a presentation of the effects of these changes, see "Pro Forma Data."

A copy of FinPro's independent valuation appraisal report was filed as an exhibit to the registration statement of which this prospectus forms a part, as specified under "Where You Can Find Additional Information."

**Subscription Offering and Subscription Rights**

According to the plan of conversion, rights to subscribe for shares of common stock in the subscription offering have been granted in the following descending order of priority. The filling of all subscriptions that we receive will depend on the availability of common stock after satisfaction of all subscriptions of all persons having prior rights in the subscription offering and will be subject to the minimum, maximum and overall purchase limitations set forth in the plan of conversion and as described below under " – Limitations on Common Stock Purchases."

***Priority 1: Eligible Account Holders.*** Each depositor with aggregate deposit account balances of $50.00 or more (a "Qualifying Deposit") on February 28, 2022 (an "Eligible Account Holder") will receive, without payment therefor, nontransferable subscription rights to purchase, subject to the overall purchase limitations, up to the greater of 20,000 shares ($200,000) of our common stock, 0.10% of the total number of shares of common stock issued in the stock offering, or 15 times the number of shares offered multiplied by a fraction of which the numerator is the Qualifying Deposit of the Eligible Account Holder and the denominator is the aggregate Qualifying Deposits of all Eligible Account Holders, subject to the overall purchase limitations. See " – Limitations on Common Stock Purchases." If there are not sufficient shares available to satisfy all subscriptions, shares will first be allocated so as to permit each Eligible Account Holder to purchase a number of shares sufficient to make their total allocation equal to the lesser of 100 shares or the number of shares for which they subscribed. Thereafter, unallocated shares will be allocated to each Eligible Account Holder whose subscription remains unfilled in the proportion that the amount of their Qualifying Deposit bears to the total amount of Qualifying Deposits of all subscribing Eligible Account Holders whose subscriptions remain unfilled. If an amount so allocated exceeds the amount subscribed for by any one or more Eligible Account Holders, the excess shall be reallocated (one or more times as necessary) among those Eligible Account Holders whose subscriptions are not fully satisfied until all available shares have been allocated.

To ensure proper allocation of shares of our common stock, each Eligible Account Holder must list on their stock order form all deposit accounts in which they had an ownership interest on February 28, 2022. In the event of oversubscription, failure to list an account, or including incomplete or incorrect information, could result in fewer shares being allocated than if all information had been disclosed. In the event of an oversubscription, the subscription rights of Eligible Account Holders who are also our directors or senior officers or their associates will be subordinated to the subscription rights of other Eligible Account Holders to the extent of such portion of their subscription rights attributable to their increased deposits during the year preceding February 28, 2022.

***Priority 2: Tax-Qualified Plans.*** Our tax-qualified employee benefit plans, specifically our employee stock ownership plan which we are establishing in connection with the conversion, will receive, without payment therefor, nontransferable subscription rights to purchase in the aggregate up to 10% of the shares of common stock sold in the stock offering and contributed to the charitable foundation. Our employee stock ownership plan intends to purchase up to 8% of the total number of shares of common stock sold in the stock offering and contributed to the charitable foundation. Alternatively, subject to market conditions and receipt of regulatory approval, the employee stock ownership plan may instead elect to purchase shares of common stock in the open market following the completion of the stock offering in order to fill all or a portion of the employee stock ownership plan's intended subscription.

***Priority 3: Other Members.*** To the extent that there are shares of common stock remaining after satisfaction of subscriptions by Eligible Account Holders and our tax-qualified employee benefit plans, each depositor and borrower as of the close of business on [voting record date] who is not an Eligible Account Holder ("Other Members") will receive, without payment therefor, nontransferable subscription rights to purchase up to the greater of 20,000 shares ($200,000) of common stock or 0.10% of the total number of shares of common stock issued in the stock offering, subject to the overall purchase limitations. See " – Limitations on Common Stock Purchases." If there are not sufficient shares available to satisfy all subscriptions, available shares will be allocated so as to permit each Other Member to purchase a number of shares sufficient to make their total allocation equal to the lesser of 100 shares of common stock or the number of shares for which they subscribed. Thereafter, unallocated shares will be allocated to each Other Member whose subscription remains unfilled in the proportion that the amount of their subscription bears to the total amount of subscriptions of all Other Members whose subscriptions remain unfilled.

To ensure proper allocation of common stock, each Other Member must list on the stock order form all deposit accounts and eligible loan accounts in which they had an ownership interest at [voting record date]. In the event of oversubscription, failure to list an account, or including incomplete or incorrect information, could result in fewer shares being allocated than if all accounts had been disclosed.

***Expiration Date*.** The Subscription Offering will expire at 5:00 p.m., Eastern time, on [expiration date], unless extended by us for up to 45 days or additional periods of up to 90 days with the approval of the ODFI and FDIC, if necessary. Subscription rights will expire whether or not each person eligible to subscribe in the subscription offering can be located. We may decide to extend the expiration date of the subscription offering for any reason, whether or not subscriptions have been received for shares at the minimum, midpoint or maximum of the offering range. Subscription rights that have not been exercised before the expiration date will become void.

We will not execute orders in the stock offering until we have received orders to purchase at least the minimum number of shares of common stock. If we have not received orders to purchase at least 1,105,000 shares within 45 days after the [expiration date] expiration date, and the ODFI and FDIC have not consented to an extension, the stock offering will be terminated and all funds delivered to purchase shares of common stock in the stock offering will be returned promptly to the subscribers with interest at a rate of 0.05% per annum, and all deposit account withdrawal authorizations will be cancelled. If an extension beyond [extended expiration date] is granted by the ODFI and FDIC, we will resolicit subscribers as described under " – Procedure for Purchasing Shares in the Subscription Offering and any Community Offering – Expiration Date."

**Community Offering**

To the extent that shares of common stock remain available for purchase after satisfaction of all subscriptions of the Eligible Account Holders, our tax-qualified employee benefit plans, and Other Members, we may offer shares pursuant to the plan of conversion to the public in a community offering, with a preference given to natural persons (and trusts of natural persons) residing in Mercer and Darke Counties in Ohio and Adams and Jay Counties in Indiana.

Persons who place orders in any community offering may purchase up to 20,000 shares ($200,000) of common stock, subject to the overall purchase limitations. See " – Limitations on Common Stock Purchases." **The opportunity to purchase shares of common stock in any community offering category is subject to our right, in our sole discretion, to accept or reject any such orders in whole or in part either at the time of receipt of an order or as soon as practicable following the expiration date of the stock offering.**

If we do not have sufficient shares of common stock available to fill the orders of natural persons (and trusts of natural persons) residing in Mercer and Darke Counties in Ohio and Adams and Jay Counties in Indiana, we will allocate the available shares among those persons in a manner that permits each of them, to the extent possible, to purchase the lesser of 100 shares, or the number of shares subscribed for by such person. Thereafter, unallocated shares will be allocated among such persons whose orders remain unsatisfied on an equal number of shares basis per order. If, instead, we do not have sufficient shares of common stock available to fill the orders of other members of the public, we will allocate the available shares among those persons in the manner described above for persons residing in Mercer and Darke Counties in Ohio and Adams and Jay Counties in Indiana. In connection with the allocation process, orders received for shares of common stock in the community offering will first be filled up to a maximum of 2% of the shares sold in the stock offering, and thereafter any remaining shares will be allocated on an equal number of shares basis per order until all shares have been allocated.

The term "residing" or "resident" as used in this prospectus means any person who occupies a dwelling within Mercer and Darke Counties in Ohio and Adams and Jay Counties in Indiana, has a present intent to remain there for a period of time and manifests the genuineness of that intent by establishing an ongoing physical presence there, together with an indication that this presence within Mercer and Darke Counties in Ohio and Adams and Jay Counties in Indiana is something other than merely transitory in nature. We may use our deposit or loan records or other evidence provided to us to decide whether a person is a resident of Mercer and Darke Counties in Ohio and Adams and Jay Counties in Indiana. In all cases, however, the determination shall be in our sole discretion.

***Expiration Date.*** The community offering, if any, may begin at the same time as, during or after the subscription offering. We will not execute stock orders until we have received orders to purchase at least the minimum number of shares of common stock. The community offering, if any, is expected to conclude at 5:00 p.m., Eastern time, on [expiration date], but must terminate no more than 45 days following the expiration of the subscription offering, unless extended with regulatory approval. We may decide to extend the community offering, if any, for any reason and are not required to give purchasers notice of any such extension unless such period extends beyond [extended expiration date]. If an extension beyond [extended expiration date] is granted by the required regulatory agencies, we will resolicit persons whose orders we accept in the community offering, giving them an opportunity to confirm, change or cancel their orders. If a person does not respond, we will cancel their stock order and return funds, with interest, and cancel any authorization to withdraw funds from deposit accounts for the purchase of shares of common stock. These extensions may not go beyond [special meeting date], which is two years after the date of the special meeting of members.

**Syndicated Community Offering**

Our board of directors may decide to offer for sale shares of common stock not subscribed for in the subscription and community offerings in a syndicated community offering in a manner that will achieve a widespread distribution of our shares of common stock to the general public. If a syndicated community offering is held, Performance Trust will serve as sole book running manager and will assist us in selling our common stock on a best efforts basis. In such capacity, Performance Trust may form a syndicate of other broker-dealers who are FINRA member firms. Neither Performance Trust nor any registered broker-dealer will have any obligation to take or purchase any shares of the common stock in any syndicated community offering.

In any syndicated community offering, any person may purchase up to 20,000 shares ($200,000) of common stock, subject to the overall purchase limitations. See " – Limitations on Common Stock Purchases." We retain the right to accept or reject in whole or in part any orders in the syndicated community offering. Unless the ODFI and the FDIC permit otherwise, accepted orders for our common stock in the syndicated community offering will first be filled up to a maximum of 2% of the shares sold in the stock offering. Thereafter any remaining shares will be allocated on an equal number of shares per order basis until all shares have been allocated. Unless the syndicated community offering begins during the subscription offering or the community offering, the syndicated community offering will begin as soon as possible after the expiration of the subscription and community offerings. The syndicated community offering must terminate no more than 45 days following the expiration of the subscription offering.

The syndicated community offering will be conducted according to certain Securities and Exchange Commission rules applicable to best efforts "min/max" offerings. Orders in the syndicated community offering will be submitted in substantially the same manner as utilized in the subscription and community offerings. Payments in the syndicated offering, however, must be made in immediately available funds (bank checks, money orders, Mercer Savings Bank deposit account withdrawal authorizations or wire transfers). Personal checks will not be accepted. If the closing of the stock offering does not occur, either as a result of not confirming receipt of at least $11.1 million in gross proceeds (the minimum of the offering range) or the inability to satisfy other closing conditions to the stock offering, the funds will be promptly returned with interest at a rate of 0.05% per annum.

The closing of the syndicated community offering, which will be simultaneous with the closing of the subscription and community offerings, is subject to conditions set forth in an agency agreement among Mercer Savings Bank and Mercer Bancorp, on one hand, and Performance Trust, on the other hand.

***Expiration Date.*** The syndicated community offering may begin concurrently with, during or after the subscription offering, and may terminate at the same time as the subscription offering, but must terminate no more than 45 days following the expiration of the subscription offering, unless extended with regulatory approval. If held, the syndicated community offering is expected to conclude at 5:00 p.m., Eastern time, on [expiration date], but must terminate no more than 45 days following the expiration of the subscription offering, unless extended with regulatory approval. We may decide to extend the syndicated community offering for any reason and are not required to give purchasers notice of any such extension unless such period extends beyond [extended expiration date]. If an extension beyond [extended expiration date] is granted by the required regulatory agencies, we will resolicit persons whose orders we accept in the syndicated community offering, giving them an opportunity to confirm, change or cancel their orders. If a person does not respond, we will cancel their stock order and return funds, with interest, and cancel any authorization to withdraw funds from deposit accounts for the purchase of shares of common stock. These extensions may not go beyond [final extension date], which is two years after the date of the special meeting of members.

If for any reason we cannot conduct a syndicated community offering of shares of common stock, or if we are unable to find purchasers from the general public to reach the minimum of the offering range, we will try to make other arrangements for the sale of unsubscribed shares, including an underwritten public offering, if possible. The ODFI, FDIC and FINRA must approve any such arrangements.

**Limitations on Common Stock Purchases**

In addition to limitations on individual purchases described above, the plan of conversion includes the following limitations on the number of shares of common stock that may be purchased in the stock offering:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· No person or entity, together with any associate or group of persons acting in concert, may purchase more than 40,000 shares ($400,000)
of common stock sold in all categories of the stock offering combined, except that our tax-qualified employee benefit plans may purchase
in the aggregate up to 10% of the shares of common stock sold in the stock offering and contributed to the charitable foundation (including
shares issued in the event of an increase in the offering range of up to 15%);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· The maximum number of shares of common stock that may be purchased in all categories of the stock offering by our senior officers
and directors and their associates, in the aggregate, may not exceed 33% of the shares sold in the stock offering; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· The minimum purchase by each person purchasing shares in the stock offering is 25 shares, to the extent those shares are available.

Depending upon market or financial conditions, with the receipt of any required regulatory approvals, we may increase the individual or aggregate purchase limitations to an amount generally not to exceed 5.0% of the common stock sold in the stock offering. If a purchase limitation is increased, subscribers in the subscription offering who ordered the maximum amount of common stock and who indicated a desire on their stock order form to be resolicited, will be, and, in our sole discretion some other large subscribers may be, given the opportunity to increase their subscriptions up to the then-applicable limit. The effect of this type of resolicitation will be to increase the number of shares of common stock owned by subscribers who choose to increase their subscriptions. If a purchase limitation is increased to 5% of the stock sold in the stock offering, such limitation may be further increased to 9.99%, provided that orders for shares of common stock exceeding 5% of the shares of common stock sold in the stock offering do not exceed in the aggregate 10% of the total shares of the common stock sold in the stock offering. Any such requests to purchase additional shares of common stock in the event that a purchase limitation is so increased will be determined by our board of directors in its sole discretion.

In the event of an increase in the offering range of up to 15% of the total number of shares of common stock offered in the stock offering, shares will be allocated in the following order of priority according to the plan of conversion:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) if there is an oversubscription at the Eligible Account Holder, tax-qualified employee benefit plans, or Other Member levels, to fill
unfulfilled subscriptions of these subscribers according to their respective priorities; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) to fill unfulfilled subscriptions in the community offering, with preference given to natural persons (and trusts of natural persons)
residing in Mercer and Darke Counties in Ohio and Adams and Jay Counties in Indiana.

The term "associate" of a person means:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) any corporation or organization, other than Mercer Savings Bank, Mercer Bancorp or a majority-owned subsidiary of these entities,
of which the person is a senior officer, partner or 10% or greater beneficial stockholder;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) any trust or other estate in which the person has a substantial beneficial interest or serves as a trustee or in a fiduciary capacity,
excluding any employee stock benefit plan in which the person has a substantial beneficial interest or serves as trustee or in a fiduciary
capacity; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) any blood or marriage relative of the person, who either resides with the person or who is a director or officer of Mercer Savings
Bank or Mercer Bancorp.

The term "acting in concert" means:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) knowing participation in a joint activity or interdependent conscious parallel action towards a common goal whether or not pursuant
to an express agreement; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) a combination or pooling of voting or other interests in the securities of an issuer for a common purpose pursuant to any contract,
understanding, relationship, agreement or other arrangement, whether written or otherwise.

In general, a person or company that acts in concert with another person or company ("other party") shall also be deemed to be acting in concert with any person or company who is also acting in concert with that other party, except that any tax-qualified employee stock benefit plan will not be deemed to be acting in concert with its trustee or a person who serves in a similar capacity solely for the purpose of determining whether common stock held by the trustee and common stock held by the employee stock benefit plan will be aggregated. Persons having the same address or exercising subscription rights through qualifying accounts registered to the same address at either the February 28, 2022 eligibility record date or [voting record date] generally will be assumed to be associates of, and acting in concert with, each other. We have the right to determine, in our sole discretion, whether purchasers are associates or acting in concert.

Our directors are not treated as associates of each other solely because of their membership on the board of directors. Shares of common stock purchased in the stock offering will be freely transferable except for shares purchased by our senior officers and directors and except as described below. Any purchases made by any associate of Mercer Savings Bank or Mercer Bancorp for the explicit purpose of meeting the minimum number of shares of common stock required to be sold in order to complete the stock offering shall be made for investment purposes only and not with a view toward redistribution. In addition, under the guidelines of FINRA, members of FINRA and their associates are subject to certain restrictions on transfer of securities purchased according to subscription rights and to certain reporting requirements upon purchase of these securities. For a further discussion of limitations on purchases of shares of our common stock at the time of conversion and thereafter, see " – Restrictions on Transfer of Subscription Rights and Shares," " – Other Restrictions" and "Restrictions on Acquisition of Mercer Bancorp."

**Plan of Distribution; Selling Agent and Underwriter Compensation**

***Subscription and Community Offerings*.** To assist in the marketing of our shares of common stock, we have retained Performance Trust, which is a broker-dealer registered with FINRA. In its role as marketing agent, Performance Trust will:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· consult with us as to the marketing implications of the plan of conversion;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· review the financial impact of the stock offering on Mercer Bancorp and Mercer Savings Bank, based upon the independent appraisal;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· review all offering documents, including the prospectus, stock order forms and related offering materials (we are responsible for
the preparation and filing of such documents);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· assist us in the design and implementation of a marketing strategy for the stock offering;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· assist in the design and implementation of a marketing strategy for the offering, including assisting management in scheduling and
preparing for meetings with potential investors and other broker-dealers; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· provide general advice and assistance as may be reasonably requested by us to promote the successful completion of the stock offering.

For these services, Performance Trust received a management fee of $25,000, which was paid at the time of execution of its engagement letter, and will receive a selling agent fee equal to the greater of (i) $250,000 and (ii) 1% of the aggregate purchase price of the shares of common stock sold in the subscription offering and any community offering, excluding shares sold to the employee stock ownership plan and to our directors, officers and employees and their immediate family members and shares contributed to the charitable foundation. The $25,000 management fee will be credited against the selling agent fee.

***Syndicated Community Offering.*** If any shares of common stock are sold through a group of broker-dealers in a syndicated community offering, we will pay fees of 5.0% of the aggregate dollar amount of shares of common stock sold in the syndicated community offering by Performance Trust and any other broker-dealers included in the syndicated community offering. Any syndicated offering will be on a best efforts basis, and Performance Trust will serve as sole book-running manager in such an offering. All fees payable with respect to a syndicated community offering will be in addition to fees payable with respect to the subscription offering and any community offering.

***Expenses.*** In its role as financial advisor, Performance Trust also will be reimbursed for its legal fees and expenses up to a maximum of $100,000 and for its other out-of-pocket expenses up to $10,000 (which may be increased to up to $20,000 in the aggregate in the event of a resolicitation of subscribers).

***Other.*** Performance Trust has not prepared any report or opinion constituting a recommendation or advice to us or to persons who subscribe for shares of Mercer Bancorp common stock, nor has it prepared an opinion as to the fairness to us of the purchase price or the terms of the common stock to be sold in the stock offering. Performance Trust expresses no opinion as to the prices at which the shares of common stock to be issued may trade.

**Records Agent and Stock Information Center Management**

In addition to engaging Performance Trust to assist in the marketing of shares of our common stock, we have engaged Performance Trust to act as our records agent and stock information center manager in connection with the stock offering. In its role as records agent and stock information center manager, Performance Trust will, among other things, assist with:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· coordinating vote solicitation and the special meetings of members;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· designing stock order forms;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· organization and supervision of the Stock Information Center; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· providing employee training.

For these services Performance Trust will receive fees totaling $30,000, with $10,000 payable upon the mailing of offering materials to prospective subscribers and the remainder payable upon closing of the stock offering. These fees can be increased by up to $10,000 if there are unusual or additional items or duplication of service required as a result of a material change in the regulations or the plan of conversion or a material delay or other similar events. In its role as records agent and stock information center manager, Performance Trust will also be reimbursed for its reasonable out-of-pocket expenses not to exceed $25,000.

**Indemnity**

We will generally indemnify Performance Trust against liabilities and expenses (including legal fees) incurred in connection with certain claims or litigation arising out of or based upon untrue statements or omissions contained in the offering material for the common stock, including liabilities under the Securities Act of 1933.

**Solicitation of Offers by Our Officers and Directors**

Some of our directors and executive officers may participate in the solicitation of offers to purchase common stock. These persons will be reimbursed for their reasonable out-of-pocket expenses incurred in connection with the solicitation. Other regular employees of Mercer Savings Bank may assist in the stock offering, but only in ministerial capacities, and may provide clerical work in effecting a sales transaction. No offers or sales may be made by tellers or at the teller counters. Investment-related questions of prospective purchasers will be directed to executive officers or registered representatives of Performance Trust. Our other employees have been instructed not to solicit offers to purchase shares of common stock or provide advice regarding the purchase of common stock. We will rely on Rule 3a4-1 under the Securities Exchange Act of 1934, as amended, and sales of common stock will be conducted within the requirements of Rule 3a4-1, so as to permit officers, directors and employees to participate in the sale of common stock. None of our officers, directors or employees will be compensated in connection with their participation in the stock offering.

**Prospectus Delivery**

To ensure that each purchaser in the subscription offering and any community offering receives a prospectus at least 48 hours before the expiration of the stock offering according to Rule 15c2-8 of the Securities Exchange Act of 1934, we may not mail a prospectus any later than five days before the expiration date or hand deliver a prospectus any later than two days before that date. We are not obligated to deliver a prospectus or stock order form by means other than U.S. Mail. Execution of a stock order form will confirm receipt of delivery of a prospectus according to Rule 15c2-8. Stock order forms will be distributed only if preceded or accompanied by a prospectus.

In any syndicated community offering, a prospectus and stock order form in electronic format may be made available on Internet sites or through other online services maintained by Performance Trust or one or more other members of the syndicate, or by their respective affiliates. In those cases, prospective investors may view offering terms online and, depending upon the syndicate member, prospective investors may be allowed to place orders online. The members of the syndicate may agree with us to allocate a specific number of shares for sale to online brokerage account holders. Any such allocation for online distributions will be made on the same basis as other allocations.

Other than the prospectus in electronic format, the information on the Internet sites referenced in the preceding paragraph and any information contained in any other Internet site maintained by any member of the syndicate is not part of this prospectus or the registration statement of which this prospectus forms a part, has not been approved and/or endorsed by us or by Performance Trust or any other member of the syndicate in its capacity as selling agent or syndicate member and should not be relied upon by investors.

**Procedure for Purchasing Shares in the Subscription Offering and any Community Offering**

***Expiration Date.*** The subscription offering and any community offering will expire at 5:00 p.m., Eastern time, on [expiration date], unless we extend one or both for up to 45 days, with the approval of the ODFI and FDIC, if required. This extension may be approved by us, in our sole discretion, without notice to purchasers in the stock offering. Any extension of the subscription offering and/or any community offering beyond [extended expiration date] would require the ODFI and the FDIC's approval. If the stock offering is so extended, all subscribers will be notified and given an opportunity to confirm, change or cancel their orders. If you do not respond to the notice of extension, we will promptly return your funds, with interest at 0.05% per annum, or cancel your deposit account withdrawal authorization. If the offering range is decreased below the minimum of the offering range or is increased above the adjusted maximum of the offering range, all subscribers' stock orders will be cancelled, their deposit account withdrawal authorizations will be cancelled, and funds submitted to us will be returned promptly, with interest at 0.05% per annum, for funds received in the subscription offering and any community offering. We will then resolicit the subscribers, giving them an opportunity to place a new stock order for a period of time.

To ensure each purchaser receives a prospectus at least 48 hours before the [expiration date] expiration date of the stock offering, according to Rule 15c2-8 of the Securities Exchange Act of 1934, as amended, no prospectus will be mailed any later than five days before the expiration date or hand delivered any later than two days before the expiration date. Execution of a stock order form will confirm receipt of delivery according to Rule 15c2-8. Stock order forms will be distributed only with, or preceded by, a prospectus.

We reserve the right in our sole discretion to terminate the stock offering at any time and for any reason, in which case we will cancel any deposit account withdrawal authorizations and promptly return all funds submitted, with interest at 0.10% per annum, from the date of receipt as described above.

***Use of Order Forms in the Subscription and Community Offerings.*** To purchase shares of common stock in the subscription and community offerings, you must properly complete an original stock order form and remit full payment. We will not accept orders submitted on photocopied or facsimiled stock order forms. All stock order forms must be *received* (not postmarked) on or before 5:00 p.m., Eastern time, on [expiration date]. We are not required to accept stock order forms that are not received by that time, are not signed or are otherwise executed defectively or are received without full payment or without appropriate deposit account withdrawal instructions. We are not required to notify subscribers of incomplete or improperly executed stock order forms. We have the right to waive or permit the correction of incomplete or improperly executed stock order forms. We do not represent, however, that we will do so and we have no affirmative duty to notify any prospective subscriber of any such defects. You may submit your stock order form and payment by mail using the stock order reply envelope provided or by overnight delivery to the address listed on the stock order form. You may hand-deliver your stock order form to our office located at 1100 Irmscher Blvd, Celina, Ohio. Our office is open on Monday, Tuesday, Wednesday and Friday from 9:00 a.m. to 5:00 p.m., Eastern time, excluding bank holidays, and on Thursday and Saturday from 9:00 a.m. to 12:00 p.m., Eastern time, excluding bank holidays. Hand-delivered stock order forms will be accepted only at this location.

Once tendered, an order form cannot be modified or revoked without our consent. We reserve the absolute right, in our sole discretion, to reject orders received in the community offering, in whole or in part, at the time of receipt or at any time before completion of the stock offering. If you are ordering shares in the stock offering, you must represent that you are purchasing shares for your own account and that you have no agreement or understanding with any person for the sale or transfer of the shares. We have the right to reject any order submitted in the stock offering by a person who we believe is making false representations or who we otherwise believe, either alone or acting in concert with others, is violating, evading, circumventing, or intends to violate, evade or circumvent the terms and conditions of the plan of conversion. Our interpretation of the terms and conditions of the plan of conversion and of the acceptability of the order forms will be final.

By signing the order form, you will be acknowledging that the common stock is not a deposit or savings account and is not federally insured or otherwise guaranteed by Mercer Savings Bank, the Federal Deposit Insurance Corporation, the federal government or any state government or agency, and that you received a copy of this prospectus. However, signing the order form will not result in you waiving your rights under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.

***Payment for Shares.*** Payment for all shares of common stock must accompany all completed order forms for the purchase to be valid. Payment for shares in the subscription and community offerings may be made by:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) personal check, bank check or money order, made payable to Mercer Bancorp, Inc.;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) authorization of withdrawal of available funds from your Mercer Savings Bank deposit account(s); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) cash.

Appropriate means for designating withdrawals from deposit account(s) at Mercer Savings Bank are provided on the stock order form. The funds designated must be available in the account(s) at the time the stock order form is received. A hold will be placed on these funds, making them unavailable to the depositor. Funds authorized for withdrawal will continue to earn interest within the account at the contractual rate until the stock offering is completed, at which time the designated withdrawal will be made. Interest penalties for early withdrawal applicable to certificate of deposit accounts will not apply to withdrawals authorized for the purchase of shares of common stock; however, if a withdrawal results in a certificate of deposit account with a balance less than the applicable minimum balance requirement, the certificate of deposit will be canceled at the time of withdrawal without penalty and the remaining balance will earn interest at the current statement savings rate after the withdrawal. In the case of payments made by personal check, these funds must be available in the account(s) on the day the order form is received by us. Checks and money orders received in the subscription and community offerings will be immediately cashed and placed in a segregated account at Mercer Savings Bank and will earn interest at 0.05% per annum from the date payment is processed until the stock offering is completed or terminated.

You may not remit any type of third-party checks (including those payable to you and endorsed over to Mercer Bancorp) or a Mercer Savings Bank line of credit check. You may not designate on your stock order form direct withdrawal from a retirement account at Mercer Savings Bank. See "—Using Individual Retirement Account Funds." Additionally, you may not designate on your stock order form a direct withdrawal from Mercer Savings Bank deposit accounts with check-writing privileges. Instead, a check should be provided. If you request a withdrawal from an account with check-writing privileges, we reserve the right to interpret that as your authorization to treat those funds as if we had received a check for the designated amount, and will immediately withdraw the amount from your checking account(s). If permitted by the FDIC, if we resolicit persons who subscribed for the maximum purchase amount, as described above in "—Limitations on Common Stock Purchases," such purchasers who wish to increase their purchases will not be able to use personal checks to pay for the additional shares, but instead must pay for the additional shares using immediately available funds. Wire transfers will not otherwise be accepted, except as described below.

Once we receive your executed stock order form, it may not be modified, amended or rescinded without our consent, unless the stock offering is not completed by [extended expiration date]. If the subscription offering and any community offering are extended past [extended expiration date], all subscribers will be notified and given an opportunity to confirm, change or cancel their orders. If you do not respond to the notice of extension, we will promptly return your funds, with interest at 0.05% per annum, or cancel your deposit account withdrawal authorization. We may resolicit purchasers for a specified period of time.

Regulations prohibit Mercer Savings Bank from lending funds or extending credit to any persons to purchase shares of common stock in the stock offering.

We have the right, in our sole discretion, to permit institutional investors to submit irrevocable orders together with the legally binding commitment for payment and to thereafter pay for the shares of common stock for which they subscribe in the community offering at any time before 48 hours before the completion of the conversion. This payment may be made by wire transfer.

If our employee stock ownership plan purchases shares in the stock offering, it will not be required to pay for such shares until completion of the stock offering, provided that there is a loan commitment from an unrelated financial institution or Mercer Bancorp to lend to the employee stock ownership plan the necessary amount to fund the purchase.

***Using Individual Retirement Account Funds.*** If you are interested in using funds held in a retirement account to purchase shares of common stock in the stock offering, you must do so through an account offered by a custodian that can hold common stock. By regulation, Mercer Savings Bank's IRAs are not capable of holding common stock. Therefore, if you wish to use funds that are currently in an IRA held at Mercer Savings Bank, you may not designate on the order form that you wish funds to be withdrawn from the account for the purchase of common stock. The funds you wish to use for the purchase of common stock will instead have to be transferred to an independent trustee or custodian, such as a brokerage firm, which offers the type of retirement accounts that can hold common stock. The purchase must be made through that account. If you do not have such an account, you will need to establish one before placing a stock order. A one-time and/or annual administrative fee may be payable to the independent trustee or custodian. There will be no early withdrawal or Internal Revenue Service interest penalties for these transfers. Individuals interested in using funds in an individual retirement account or any other retirement account, whether held at Mercer Savings Bank or elsewhere, to purchase shares of common stock should contact our Stock Information Center for guidance as soon as possible, but in no event less than two weeks before the [expiration date] offering deadline. You may select the independent trustee or custodian of your choice. However, processing these transactions takes additional time, and whether such funds can be used may depend on limitations imposed by the institutions where such funds are currently held or the independent trustee or custodian you select. We cannot guarantee that you will be able to use such funds.

***Delivery of Shares of Common Stock.*** All shares of common stock sold will be issued in book entry form. Stock certificates will not be issued. A book entry statement reflecting ownership of shares of common stock issued in the subscription offering and any community offering will be mailed by our transfer agent to the persons entitled thereto at the registration address noted by them on their stock order forms as soon as practicable following consummation of the conversion and stock offering. We expect trading in the stock to begin on the day of completion of the conversion and stock offering or the next business day. **You may not be able to sell the shares of common stock that you purchased until a statement reflecting your ownership of shares of common stock is available and delivered to you, even though the shares of common stock will have begun trading.** Your ability to sell the shares of common stock before receiving your statement will depend on arrangements you may make with a brokerage firm.

***Other Restrictions.*** Notwithstanding any other provision of the plan of conversion, no person is entitled to purchase any shares of common stock to the extent the purchase would be illegal under any federal or state law or regulation, including state "blue sky" regulations, or would violate regulations or policies of the Financial Industry Regulatory Authority, particularly those regarding free riding and withholding. We may ask for an acceptable legal opinion from any purchaser as to the legality of their purchase and we may refuse to honor any purchase order if an opinion is not timely furnished. In addition, we are not required to offer shares of common stock to any person who resides in a foreign country, or in a state of the United States with respect to which any of the following apply:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) a small number of persons otherwise eligible to subscribe for shares under the plan of conversion reside in such state;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the offer or sale of shares of common stock to such persons would require us or our employees to register, under the securities laws
of such state, as a broker or dealer or to register or otherwise qualify our securities for sale in such state; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) such registration or qualification would be impracticable for reasons of cost or otherwise.

**Restrictions on Transfer of Subscription Rights and Shares**

**Applicable banking regulations prohibit any person with subscription rights, including the Eligible Account Holders and Other Members, from transferring or entering into any agreement or understanding to transfer the legal or beneficial ownership of the subscription rights issued under the plan of conversion or the shares of common stock to be issued upon their exercise. These rights may be exercised only by the person to whom they are granted and only for their account. When registering your stock purchase on the stock order form, you cannot add the name(s) of others for joint stock registration unless they are also named on the qualifying deposit or loan account. Taking this action may jeopardize your subscription rights. Each person exercising subscription rights will be required to certify that they are purchasing shares solely for their own account and that they has no agreement or understanding regarding the sale or transfer of such shares. The regulations also prohibit any person from offering or making an announcement of an offer or intent to make an offer to purchase subscription rights or shares of common stock to be issued upon their exercise before completion of the stock offering.**

**We will pursue any and all legal and equitable remedies if we become aware of the transfer of subscription rights, and we will not honor orders that we believe involve the transfer of subscription rights.**

**Stock Information Center**

Our banking office personnel may not, by law, assist with investment-related questions about the stock offering. If you have questions regarding the conversion or stock offering, call our Stock Information Center at [information center number]. The Stock Information Center is accepting telephone calls Monday through Friday, between 10:00 a.m. and 5:00 p.m., Eastern time, excluding bank holidays.

**Liquidation Rights**

In the unlikely event of a complete liquidation of Mercer Savings Bank before the completion of the conversion and stock offering, all claims of creditors of Mercer Savings Bank, including those of its depositors (to the extent of their deposit balances), would be paid first. Then, if there were any assets of Mercer Savings Bank remaining, depositors of Mercer Savings Bank would receive those remaining assets, pro rata, based upon the deposit balances in their deposit accounts in Mercer Savings Bank immediately before liquidation.

The plan of conversion provides for the establishment, upon the completion of the conversion and stock offering, of a "liquidation account" for the benefit of Eligible Account Holders in an amount equal to the total equity of Mercer Savings Bank as of the date of its latest balance sheet contained in this prospectus. In the unlikely event that Mercer Savings Bank were to liquidate after the conversion and stock offering, all claims of creditors, including those of depositors, would be paid first, followed by distribution of the "liquidation account" to certain depositors, with any assets remaining thereafter distributed to Mercer Bancorp in its capacity as the sole holder of Mercer Savings Bank capital stock. Pursuant to applicable rules and regulations, a post-conversion merger, consolidation, sale of bulk assets or similar combination or transaction with another insured savings institution would not be considered a liquidation and, in these types of transactions, the liquidation account would be assumed by the surviving institution.

The plan of conversion provides for the establishment, upon the completion of the conversion and stock offering, of a "liquidation account" for the benefit of Eligible Account Holders in an amount equal to the total equity of Mercer Savings Bank as of the date of its latest balance sheet contained in this prospectus.

The purpose of the liquidation account is to provide Eligible Account Holders who maintain their deposit accounts with Mercer Savings Bank after the conversion and stock offering with a liquidation interest in the unlikely event of the complete liquidation of Mercer Savings Bank after the conversion and stock offering. Each Eligible Account Holder that continues to maintain their deposit account at Mercer Savings Bank, would be entitled, on a complete liquidation of Mercer Savings Bank after the conversion and stock offering, to an interest in the liquidation account before any payment to the stockholders of Mercer Bancorp. Each Eligible Account Holder would have an initial interest in the liquidation account for each deposit account, including savings accounts, transaction accounts such as negotiable order of withdrawal accounts, money market deposit accounts, and certificates of deposit, with a balance of $50 or more held in Mercer Savings Bank as of the close of business on February 28, 2022. Each Eligible Account Holder would have a pro rata interest in the total liquidation account for each such deposit account, based on the proportion that the balance of each such deposit account as of the close of business on February 28, 2022 bears to the balance of all such deposit accounts in Mercer Savings Bank on such date.

If, however, on any September 30 annual closing date commencing on or after the effective date of the conversion and stock offering, the amount in any such deposit account is less than the amount in the deposit account as of the close of business on February 28, 2022 or any other annual closing date, then the interest in the liquidation account relating to such deposit account would be reduced from time to time by the proportion of any such reduction, and such interest will cease to exist if such deposit account is closed. In addition, no interest in the liquidation account would ever be increased despite any subsequent increase in the related deposit account. Payment pursuant to liquidation rights of Eligible Account Holders would be separate and apart from the payment of any insured deposit accounts to such depositor. Any assets remaining after the above liquidation rights of Eligible Account Holders are satisfied would be distributed to Mercer Bancorp in its capacity as the sole stockholder of Mercer Savings Bank.

**Material Income Tax Consequences**

Consummation of the conversion is subject to the prior receipt of an opinion of counsel or tax advisor with respect to federal and state income taxation that the conversion will not be a taxable transaction to Mercer Savings Bank, Mercer Bancorp, Eligible Account Holders, and Other Members. Unlike private letter rulings, opinions of counsel or tax advisors are not binding on the Internal Revenue Service or any state taxing authority, and such authorities may disagree with such opinions. In the event of such disagreement, there can be no assurance that Mercer Savings Bank or Mercer Bancorp would prevail in a judicial proceeding.

Mercer Savings Bank and Mercer Bancorp have received an opinion from its counsel, Luse Gorman, PC, regarding the material federal income tax consequences of the conversion and stock offering, which includes the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The conversion of Mercer Savings Bank to an Ohio state-chartered stock bank will qualify as a tax-free reorganization within the meaning
of Section 368(a)(1)(F) of the Internal Revenue Code.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Mercer Savings Bank will not recognize any gain or loss upon the receipt of money from Mercer Bancorp in exchange for shares of common
stock of Mercer Savings Bank.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. The basis and holding period of the assets received by Mercer Savings Bank, in stock form, from Mercer Savings Bank, in mutual form,
will be the same as the basis and holding period in such assets immediately before the conversion.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. No gain or loss will be recognized by account holders of Mercer Savings Bank, including Eligible Account Holders and Other Members,
upon the issuance to them of withdrawable deposit accounts in Mercer Savings Bank, in stock form, in the same dollar amount and under
the same terms as held at Mercer Savings Bank, in mutual form. In addition, Eligible Account Holders will not recognize gain or loss upon
receipt of an interest in a liquidation account in Mercer Savings Bank, in stock form, in exchange for their ownership interests in Mercer
Savings Bank, in mutual form.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. The basis of the account holders' deposit accounts in Mercer Savings Bank, in stock form, will be the same as the basis of their
deposit accounts in Mercer Savings Bank, in mutual form. The basis of the Eligible Account Holders' interests in the liquidation
account will be zero, which is the cost of such interest to such persons.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. It is more likely than not that the fair market value of the nontransferable subscription rights will be zero, based on the fact that
these rights are acquired by the recipients without cost, are nontransferable and of short duration, and afford the recipients the right
only to purchase the common stock at a price equal to its estimated fair market value, which will be the same price as the subscription
price for the shares of common stock in the stock offering. Accordingly, no gain or loss will be recognized by Eligible Account Holders
or Other Members upon distribution to them of nontransferable subscription rights to purchase shares of Mercer Bancorp common stock, provided
that the amount to be paid for Mercer Bancorp common stock is equal to the fair market value of Mercer Bancorp common stock.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. It is more likely than not that the basis of the shares of Mercer Bancorp common stock purchased in the stock offering will be the
purchase price. The holding period of the Mercer Bancorp common stock purchased pursuant to the exercise of nontransferable subscription
rights will commence on the date on which the right to acquire such stock was exercised.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. No gain or loss will be recognized by Mercer Bancorp on the receipt of money in exchange for shares of Mercer Bancorp common stock
sold in the stock offering.

In the view of FinPro (which is acting as independent appraiser of the value of the shares of Mercer Bancorp common stock), the subscription rights do not have any value for the reasons set forth above. FinPro's view is not binding on the Internal Revenue Service. If the subscription rights granted to Eligible Account Holders and Other Members are deemed to have an ascertainable value, receipt of these rights could result in taxable gain to those Eligible Account Holders and Other Members who exercise the subscription rights in an amount equal to their value, and Mercer Bancorp could recognize gain on a distribution. Eligible Account Holders and Other Members are encouraged to consult with their own tax advisors as to the tax consequences in the event that subscription rights are deemed to have an ascertainable value.

The opinion as to the basis in the liquidation account set forth in item 4 above is based on the position that: (i) no holder of an interest in a liquidation account has ever received any payment attributable to a liquidation of a solvent bank (other than as set forth below); (ii) the interests in the liquidation account are not transferable; (iii) the amounts due under the liquidation account with respect to each Eligible Account Holder will be reduced as their deposits in Mercer Savings Bank are reduced; and (iv) holders of an interest in a liquidation account have received payments of their interests in very few instances (out of hundreds of transactions involving mergers, acquisitions and the purchase of assets and assumption of liabilities of holding companies and subsidiary banks) and these instances involved the purchase and assumption of a bank's assets and liabilities by a credit union. In addition, we have received a letter from FinPro stating its belief that the benefit provided by the Mercer Savings Bank liquidation account does not have any economic value as of the effective time of the conversion and stock offering. Based on the foregoing, Luse Gorman, PC believes it is more likely than not that such rights in the Mercer Savings Bank liquidation account have no value. If such rights are subsequently found to have an economic value as of the effective time of the conversion and stock offering, income may be recognized by each Eligible Account Holder in the amount of such fair market value as of the effective date of the conversion and stock offering.

The Internal Revenue Service will not issue private letter rulings with respect to the issue of whether nontransferable rights have value. Unlike private letter rulings, an opinion of counsel or the view of an independent appraiser is not binding on the Internal Revenue Service and the Internal Revenue Service could disagree with the conclusions reached therein. Depending on the conclusion or conclusions with which the Internal Revenue Service disagrees, the Internal Revenue Service may take the position that the transaction is taxable to any one or more of Mercer Savings Bank, its members, Mercer Bancorp, Eligible Account Holders and Other Members who exercise their subscription rights. In the event of a disagreement, there can be no assurance that Mercer Bancorp or Mercer Savings Bank would prevail in a judicial or administrative proceeding.

The federal income tax opinion has been filed with the Securities and Exchange Commission as an exhibit to Mercer Bancorp's registration statement. An opinion regarding the Ohio income tax consequences consistent with the federal income tax opinion has been issued by Snodgrass.

**Restrictions on Purchase or Transfer of Our Shares after the Conversion and Stock Offering**

The shares of common stock being acquired by the directors, executive officers of Mercer Savings Bank, and their associates, are being acquired for investment purposes, and not with a view towards resale. All shares of common stock purchased in the stock offering by a director or an executive officer of Mercer Bancorp or Mercer Savings Bank generally may not be sold for a period of one year following the closing of the conversion and stock offering, except in the event of the death of the director or executive officer. Each statement of ownership or certificate for restricted shares will bear a legend giving notice of this restriction on transfer, and instructions will be issued to the effect that any transfer within this time period of any certificate or ownership of the shares other than as provided above is a violation of the restriction. Any shares of common stock issued at a later date as a stock dividend, stock split or otherwise with respect to the restricted stock will be similarly restricted. The directors and executive officers of Mercer Bancorp also will be restricted by the insider trading rules under the Securities Exchange Act of 1934, as amended.

Purchases of shares of our common stock by any of our directors, executive officers and their associates, during the three-year period following the closing of the conversion and stock offering, may be made only through a broker or dealer registered with the Securities and Exchange Commission, except with the prior written approval of the FDIC. This restriction does not apply, however, to negotiated transactions involving more than 1% of our outstanding common stock, to purchases of our common stock to fund stock options by one or more stock-based benefit plans or to any of our tax-qualified employee stock benefit plans or nontax-qualified employee stock benefit plans, including any stock-based benefit plans.

Applicable conversion regulations prohibit Mercer Bancorp from repurchasing its shares of common stock during the first year following the conversion unless compelling business reasons exist for such repurchases, or to fund management recognition plans that have been ratified by stockholders (with any applicable regulatory approval) or tax-qualified employee stock benefit plans.

**CHARITABLE FOUNDATION**

**General**

In furtherance of our commitment to the communities in our market area, the plan of conversion provides that we will establish a new charitable foundation, the Mercer Savings Charitable Foundation, as a non-stock, nonprofit Delaware corporation in connection with the conversion and stock offering. The charitable foundation will be funded with cash and shares of our common stock, as described below. By further enhancing our visibility and reputation in the communities within our market area, we believe that the charitable foundation will enhance the long-term value of Mercer Savings Bank's community banking franchise. The conversion and stock offering present a unique opportunity to provide a substantial and continuing benefit to our community through the charitable foundation. The establishment and funding of the charitable foundation is subject to regulatory approval and approval by Mercer Savings Bank's members.

**Purpose of the Charitable Foundation**

In connection with the closing of the conversion and stock offering, we intend to contribute to the charitable foundation $100,000 in cash and 50,000 shares of our common stock, for an aggregate contribution of $600,000 based on the $10.00 per share offering price.

The purpose of the charitable foundation is to provide financial support to charitable organizations in our market area and to enable the communities that we serve to share in our long-term growth. The charitable foundation will be dedicated completely to community activities and the promotion of charitable causes and may be able to support these activities in ways that are not presently available to us.

Funding the charitable foundation with shares of our common stock is also intended to allow our communities to share in our potential growth and success after the conversion and stock offering is completed because the charitable foundation will benefit directly from any increases in the value of our shares of common stock. In addition, the charitable foundation will maintain close ties with Mercer Savings Bank, forming a partnership within the communities in which Mercer Savings Bank operates.

**Structure of the Charitable Foundation**

The charitable foundation will be incorporated under Delaware law as a non-stock, nonprofit corporation. The certificate of incorporation of the charitable foundation will provide that the corporation is organized exclusively for charitable purposes as set forth in Section 501(c)(3) of the Internal Revenue Code. The certificate of incorporation will further provide that no part of the net earnings of the charitable foundation will inure to the benefit of, or be distributable to, its members, directors or officers or to private individuals.

The charitable foundation will be governed by a board of directors, initially consisting of Kristin M. Fee, a director of Mercer Savings Bank, and two other individuals. We are required to select one person to serve on the initial board of directors who is not one of our officers or directors and who should have experience with local charitable organizations and grant making. This requirement will last for five years from the conversion and stock offering. As of the date of this prospectus, we have not selected the individual to serve as the director to satisfy these requirements. For five years after the conversion and stock offering, at least one seat on the charitable foundation's board of directors will also be reserved for a director of Mercer Savings Bank.

The board of directors of the charitable foundation will be responsible for establishing its grant and donation policies, consistent with the purposes for which it was established. As directors of a nonprofit corporation, the directors of the charitable foundation will be bound by their fiduciary duty to advance the charitable foundation's charitable goals, to protect its assets and to act in a manner consistent with the charitable purposes for which the charitable foundation is established. The directors also will be responsible for directing the activities of the charitable foundation, including the management and voting of the shares of our common stock held by the charitable foundation. However, as required by applicable regulations, all shares of our common stock held by the charitable foundation must be voted in the same ratio as all other shares of our common stock on all proposals considered by our stockholders.

The charitable foundation's place of business will be located at Mercer Savings Bank's main office. The board of directors of the charitable foundation will appoint such officers and employees as may be necessary to manage its operations. To the extent applicable, we will comply with the affiliate restrictions set forth in Sections 23A and 23B of the Federal Reserve Act and applicable banking regulations governing transactions between Mercer Savings Bank and the charitable foundation.

The charitable foundation will receive working capital from the initial cash contribution and:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any dividends that may be paid on our shares of common stock in the future to the extent that it continues to own shares of our common
stock;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) within the limits of applicable federal and state laws, loans collateralized by the shares of common stock; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) the proceeds of the sale of any of the shares of common stock in the open market from time to time.

As a private foundation under Section 501(c)(3) of the Internal Revenue Code, the charitable foundation will generally be required to distribute annually in grants or donations a minimum of 5% of the average fair market value of its net investment assets.

**Income Tax Considerations**

We believe that an organization created for the above purposes should qualify as a Section 501(c)(3) tax exempt organization under the Internal Revenue Code and should be classified as a private foundation. As long as the charitable foundation files an application for tax-exempt status within 27 months of the last day of the month in which it was organized, and provided the Internal Revenue Service approves the application, its effective date as a Section 501(c)(3) organization will be the date of its organization. We have not received a tax opinion as to whether the charitable foundation's tax-exempt status will be affected by the regulatory requirement that all shares of our common stock held by it must be voted in the same ratio as all other outstanding shares of our common stock on all proposals considered by our stockholders.

We believe that our contribution of shares of our common stock to the charitable foundation should not constitute an act of self-dealing and that we should be entitled to a deduction in the amount of the fair market value of the stock at the time of the contribution less the nominal amount that the charitable foundation is required to pay us for such stock. We are permitted to deduct for charitable purposes only an amount equal to 10% of our annual taxable income in any one year. We are permitted under the Internal Revenue Code to carry the excess contribution over the five-year period following the contribution to the charitable foundation. We estimate that the contribution should be deductible over the six-year period (i.e., the year in which the contribution is made and the succeeding five-year period). However, we do not have any assurance that the Internal Revenue Service will grant tax-exempt status to the charitable foundation. In that event, our contribution to the charitable foundation would be expensed without a tax benefit, resulting in a reduction in earnings in the year in which the Internal Revenue Service makes the determination. Furthermore, even if the contribution is deductible, we may not have sufficient earnings to be able to use the deduction in full. Any decision to continue to make additional contributions to the charitable foundation in the future would be based on an assessment of, among other factors, our financial condition at that time, the interests of our stockholders and depositors, and the financial condition and operations of the foundation.

As a private foundation, earnings and gains, if any, from the sale of common stock or other assets are exempt from federal and state income taxation. However, investment income, such as interest, dividends and capital gains, is generally taxed at a rate of 1%. The charitable foundation will be required to file an annual return with the Internal Revenue Service within four and one-half months after the close of its fiscal year. The charitable foundation will be required to make its annual return available for public inspection. The annual return for a private foundation includes, among other things, an itemized list of all grants made or approved, showing the amount of each grant, the recipient, any relationship between a grant recipient and the foundation's managers and a concise statement of the purpose of each grant.

**Regulatory Requirements Imposed on the Charitable Foundation**

Applicable regulations require that, before Mercer Savings Bank's board of directors adopted the plan of conversion, the board of directors had to identify its member(s) that will serve on the charitable foundation's board of directors, and these director(s) could not participate in the discussions of Mercer Savings Bank's board of directors concerning contributions to the charitable foundation and could not vote on the matter. Mercer Savings Bank's board of directors complied with this regulation in adopting the plan of conversion.

The ODFI and FDIC will generally not object if a well-capitalized bank contributes to a charitable foundation an aggregate amount of 8% or less of the shares or proceeds issued in a conversion stock offering. Mercer Savings Bank qualifies as a well-capitalized savings association for purposes of this limitation, and the contribution to the charitable foundation will not exceed this limitation.

The ODFI and the FDIC impose the following additional requirements on the establishment of the charitable foundation:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the charitable foundation's primary purpose must be to serve and make grants in our local community;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the ODFI and the FDIC may examine the charitable foundation at the foundation's expense;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the charitable foundation must comply with all supervisory directives imposed by the ODFI and FDIC;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the charitable foundation must provide annually to the ODFI and the FDIC a copy of the annual report that the charitable foundation
submits to the Internal Revenue Service;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the charitable foundation must operate according to written policies adopted by its board of directors, including a conflict of interest
policy;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the charitable foundation may not engage in self-dealing and must comply with all laws necessary to maintain its tax-exempt status
under the Internal Revenue Code; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the charitable foundation must vote its shares of our common stock in the same ratio as all of the other shares voted on each proposal
considered by our stockholders.

**Approvals Required**

Mercer Savings Bank's plan of conversion, including the establishment and funding of the charitable foundation, must be approved by the ODFI and the FDIC. Additionally, the Federal Reserve Board must approve Mercer Bancorp's holding company application for us to execute the plan of conversion. If any required regulatory approvals are not received, we will not establish and fund the charitable foundation.

Additionally, the affirmative vote of two-thirds of the total eligible votes of members of Mercer Savings Bank is required to approve the plan of conversion and the affirmative vote of a majority of the total eligible votes of members of Mercer Savings Bank is required to approve the establishment and funding of the charitable foundation. A special meeting of members to consider and vote upon the plan of conversion and the establishment and funding of the charitable foundation has been set for [special meeting date]. If the plan of conversion is not approved by the members of Mercer Savings Bank, we will not proceed with the conversion and stock offering or the establishment and funding of the charitable foundation. If the plan of conversion is approved by the members but the establishment and funding of the charitable foundation is not, we will proceed with the conversion and stock offering, but will not establish and fund the charitable foundation.

**RESTRICTIONS ON ACQUISITION OF MERCER BANCORP**

Although the board of directors of Mercer Bancorp is not aware of any effort that might be made to obtain control of Mercer Bancorp after the conversion and stock offering, the board of directors believes that it is appropriate to include certain provisions in Mercer Bancorp's articles of incorporation and bylaws to protect the interests of Mercer Bancorp and its stockholders from takeovers which our board of directors might conclude are not in the best interests of Mercer Savings Bank, Mercer Bancorp or its stockholders.

The following discussion is a general summary of the material provisions of Mercer Bancorp's articles of incorporation and bylaws, Mercer Savings Bank's federal stock charter and bylaws, Maryland corporation law and certain other regulatory provisions that may be deemed to have an "anti-takeover" effect. The following description of certain of these provisions is necessarily general and, with respect to provisions contained in Mercer Bancorp's articles of incorporation and bylaws and Mercer Savings Bank's federal stock charter and bylaws, reference should be made in each case to the document in question, each of which is part of Mercer Savings Bank's application for conversion filed with the FDIC, and except for Mercer Savings Bank's federal stock charter and bylaws, Mercer Bancorp's registration statement filed with the Securities and Exchange Commission. See "Where You Can Find Additional Information."

**Mercer Bancorp's Articles of Incorporation and Bylaws**

Mercer Bancorp's articles of incorporation and bylaws contain a number of provisions relating to corporate governance and rights of stockholders that might discourage future takeover attempts. As a result, stockholders who might desire to participate in such transactions may not have an opportunity to do so. In addition, these provisions will also render the removal of the board of directors or management of Mercer Bancorp more difficult.

***Directors****.* The board of directors will be divided into three classes. The members of each class will be elected for a term of three years and only one class of directors will be elected annually. Therefore, it would take at least two annual elections to replace a majority of our directors. The bylaws establish qualifications for board members, including:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· a prohibition on service as a director by a person who is a director, officer, employee or a 10% stockholder of a competitor of Mercer
Savings Bank;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· a prohibition on service as a director by a person (i) who has been convicted of a crime involving dishonesty or breach of trust
that is punishable by imprisonment for a term exceeding one year under state or federal law, (ii) who is currently charged in an
information, indictment or other complaint with the commission of or participation in such a crime, or (iii) against whom a financial
or securities regulatory agency has, within the past ten years, issued a cease and desist, consent or other formal order, other than a
civil money penalty, which order is subject to public disclosure by such agency;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· a prohibition on service as a director by a person who is party to any agreement or understanding that (i) provides such person
with material benefits that are contingent upon Mercer Bancorp entering into a merger or similar transaction in which it is not the surviving
entity, (ii) materially limits such person's voting discretion with respect to Mercer Bancorp's strategic direction,
or (iii) materially impairs such person's ability to discharge their fiduciary duties with respect to the fundamental strategic
direction of Mercer Bancorp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· a requirement that any person proposed to serve as a director (other than the initial directors and other than directors who are also
officers of Mercer Bancorp or Mercer Savings Bank) has maintained their principal residence for a period of at least one year immediately
before their nomination or appointment to the Board of Directors within a county in which Mercer Savings Bank maintains an office, or
in a contiguous county; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· a prohibition on service as a director by a person who has lost more than one election for service as a director of Mercer Bancorp.

Further, the bylaws impose notice and information requirements in connection with the nomination by stockholders of candidates for election to the board of directors or the proposal by stockholders of business to be acted upon at an annual meeting of stockholders. Such notice and information requirements are applicable to all stockholder business proposals and nominations, and are in addition to any requirements under the federal securities laws.

***Evaluation of Offers.*** The articles of incorporation of Mercer Bancorp provide that its board of directors, when evaluating a transaction that would or may involve a change in control of Mercer Bancorp (whether by purchases of its securities, merger, consolidation, share exchange, dissolution, liquidation, sale of all or substantially all of its assets, proxy solicitation or otherwise), may, in connection with the exercise of its business judgment in determining what is in the best interests of Mercer Bancorp and its stockholders and in making any recommendation to the stockholders, give due consideration to all relevant factors, including, but not limited to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the economic effect, both immediate and long-term, upon Mercer Bancorp's stockholders, including stockholders, if any, who do
not participate in the transaction;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the social and economic effect on the present and future employees, creditors and customers of, and others dealing with, Mercer Bancorp
and its subsidiaries and on the communities in which it and its subsidiaries operate or are located;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· whether the proposal is acceptable based on the historical, current or projected future operating results or financial condition of
Mercer Bancorp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· whether a more favorable price could be obtained for Mercer Bancorp's stock or other securities in the future;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the reputation and business practices of the other entity to be involved in the transaction and its management and affiliates as they
would affect the employees of Mercer Bancorp and its subsidiaries;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the future value of the stock or any other securities of Mercer Bancorp or the other entity to be involved in the proposed transaction;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· any antitrust or other legal and regulatory issues that are raised by the proposal;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the business and historical, current or expected future financial condition or operating results of the other entity to be involved
in the transaction, including, but not limited to, debt service and other existing financial obligations, financial obligations to be
incurred in connection with the proposed transaction, and other likely financial obligations of the other entity to be involved in the
proposed transaction; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the
 ability of Mercer Bancorp to fulfill its objectives as a financial institution holding company
 and on the ability of its subsidiary financial institution(s) to fulfill the objectives
 of a federally-insured financial institution(s) under applicable statutes and regulations.

If the board of directors determines that any proposed transaction should be rejected, it may take any lawful action to defeat such transaction.

***Restrictions on Calling Special Meetings.*** The bylaws provide that special meetings of stockholders can be called by only the President, Chief Executive Officer or Chairperson of the board of directors, a majority of the total number of directors that Mercer Bancorp would have if there were no vacancies on the board of directors, or the Secretary upon the written request of stockholders entitled to cast at least a majority of all votes entitled to vote at the meeting.

***Prohibition of Cumulative Voting.*** The articles of incorporation prohibit cumulative voting for the election of directors.

***Limitation of Voting Rights.*** The articles of incorporation provide that in no event will any person who beneficially owns more than 10% of the then-outstanding shares of common stock be entitled or permitted to vote any of the shares of common stock held in excess of the 10% limit. The 10% limit shall not apply if, before the stockholder acquires shares in excess of the 10% limit, the acquisition is approved by a majority of the directors who are not affiliated with the holder and who were members of the board of directors before the time of the acquisition (or who were chosen to fill any vacancy of an otherwise unaffiliated director by a majority of the unaffiliated directors).

***Restrictions on Removing Directors from Office.*** The articles of incorporation provide that directors may be removed only for cause, and only by the affirmative vote of the holders of at least two-thirds of the voting power of all of our then-outstanding capital stock entitled to vote generally in the election of directors (after giving effect to the limitation on voting rights discussed above in " – Limitation of Voting Rights"), voting together as a single class.

***Stockholder Nominations and Proposals.*** The bylaws provide that any stockholder desiring to make a nomination for the election of directors or a proposal for new business at an annual meeting of stockholders must submit written notice to Mercer Bancorp at least 90 days before and not earlier than 100 days before the anniversary date of the previous year's annual meeting. However, if the date of the annual meeting is advanced by more than 30 days from the anniversary date of the preceding year's annual meeting then stockholders must submit written notice to Mercer Bancorp no later than 10 days following the day on which public disclosure of the date of the meeting is first made or mailed to stockholders.

***Authorized but Unissued Shares*.** After the conversion and stock offering, Mercer Bancorp will have authorized but unissued shares of common and preferred stock. The articles of incorporation authorize 1,000,000 shares of serial preferred stock. Mercer Bancorp is authorized to issue preferred stock from time to time in one or more series subject to applicable provisions of law, and the board of directors is authorized to fix the preferences, conversion and other rights, voting powers, restrictions, limitations as to dividends, qualifications and terms and conditions of redemption of such shares. In addition, the articles of incorporation provide that a majority of the total number of directors that Mercer Bancorp would have if there were no vacancies on the board of directors may, without action by the stockholders, amend the articles of incorporation to increase or decrease the aggregate number of shares of stock of any class or series that Mercer Bancorp has the authority to issue. In the event of a proposed merger, tender offer or other attempt to gain control of Mercer Bancorp that the board of directors does not approve, it would be possible for the board of directors to authorize the issuance of a series of preferred stock with rights and preferences that would impede the completion of the transaction. An effect of the possible issuance of preferred stock therefore may be to deter a future attempt to gain control of Mercer Bancorp. The board of directors has no present plan or understanding to issue any preferred stock.

***Amendments to Articles of Incorporation and Bylaws.*** Except as provided under " – Authorized but Unissued Shares," above, regarding the amendment of the articles of incorporation by the board of directors to increase or decrease the number of shares authorized for issuance, or as otherwise allowed by law, any amendment to the articles of incorporation must be approved by our board of directors and also by two-thirds of the outstanding shares of our voting stock (or a majority of the outstanding shares of our voting stock if the amendment is approved by two-thirds of our board of directors); provided, however, that approval by at least 80% of the outstanding voting stock is generally required to amend the following provisions:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the
 limitation on voting rights of persons who directly or indirectly beneficially own more than
 10% of the outstanding shares of common stock;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) the
 division of the board of directors into three staggered classes;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) the
 ability of the board of directors to fill vacancies on the board;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) the
 requirement that at least two-thirds of the voting power of the stockholders must vote to
 remove directors, and can only remove directors for cause;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) the
 ability of the board of directors to amend and repeal the bylaws and the required stockholder
 vote to amend or repeal the bylaws;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) the
 ability of the board of directors to evaluate a variety of factors in evaluating offers to
 purchase or otherwise acquire Mercer Bancorp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) the
 authority of the board of directors to provide for the issuance of preferred stock;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) the
 validity and effectiveness of any action lawfully authorized by the affirmative vote of the
 holders of a majority of the total number of outstanding shares of common stock;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix) the
 number of stockholders constituting a quorum or required for stockholder consent;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x) the
 provision regarding stockholder proposals and nominations;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xi) the
 indemnification of current and former directors and officers, as well as employees and other
 agents, by Mercer Bancorp;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xii) the
 limitation of liability of officers and directors to Mercer Bancorp for money damages; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xiii) the
 provision of the articles of incorporation requiring approval of at least 80% of the outstanding
 voting stock to amend the provisions of the articles of incorporation set forth in (i) through
 (xii) of this list and the provisions related to amendment of the articles of incorporation.

The articles of incorporation also provide that the bylaws may be amended by the affirmative vote of a majority of the total number of directors that Mercer Bancorp would have if there were no vacancies on the board of directors or by the stockholders by the affirmative vote of at least 80% of the votes entitled to be cast in the election of directors (after giving effect to the limitation on voting rights discussed above in " – Limitation of Voting Rights").

**Maryland Corporate Law**

Under Maryland law, "business combinations" between a Maryland corporation and an interested stockholder or an affiliate of an interested stockholder are prohibited for five years after the most recent date on which the interested stockholder becomes an interested stockholder. These business combinations include a merger, consolidation, statutory share exchange or, in circumstances specified in the statute, certain transfers of assets, certain stock issuances and transfers, liquidation plans and reclassifications involving interested stockholders and their affiliates or issuance or reclassification of equity securities. Maryland law defines an interested stockholder as: (i) any person who beneficially owns 10% or more of the voting power of a corporation's voting stock after the date on which the corporation had 100 or more beneficial owners of its stock; or (ii) an affiliate or associate of the corporation at any time after the date on which the corporation had 100 or more beneficial owners of its stock who, within the two-year period before the date in question, was the beneficial owner of 10% or more of the voting power of the then-outstanding voting stock of the corporation. A person is not an interested stockholder under the statute if the board of directors approved in advance the transaction by which the person otherwise would have become an interested stockholder. However, in approving a transaction, the board of directors may provide that its approval is subject to compliance, at or after the time of approval, with any terms and conditions determined by the Board.

After the five-year prohibition, any business combination between the Maryland corporation and an interested stockholder generally must be recommended by the board of directors of the corporation and approved by the affirmative vote of at least: (i) 80% of the votes entitled to be cast by holders of outstanding shares of voting stock of the corporation; and (ii) two-thirds of the votes entitled to be cast by holders of voting stock of the corporation other than shares held by the interested stockholder with whom or with whose affiliate the business combination is to be effected or held by an affiliate or associate of the interested stockholder. These super-majority vote requirements do not apply if the corporation's common stockholders receive a minimum price, as defined under Maryland law, for their shares in the form of cash or other consideration in the same form as previously paid by the interested stockholder for its shares.

**Mercer Savings Bank's Stock Charter**

Following the conversion, the articles of incorporation of Mercer Savings Bank will provide that for a period of five years from the closing of the conversion and stock offering, no person (including a group acting in concert) other than Mercer Bancorp may offer directly or indirectly to acquire the beneficial ownership of more than 10% of any class of equity security of Mercer Savings Bank. This provision does not apply to any tax-qualified employee benefit plan of Mercer Savings Bank or Mercer Bancorp, or to an underwriter or member of an underwriting or selling group involving the public sale or resale of securities of Mercer Savings Bank or any of its subsidiaries, so long as after the sale or resale, no underwriter or member of the selling group is a beneficial owner, directly or indirectly, of more than 10% of any class of equity securities of Mercer Savings Bank. In addition, during this five-year period, all shares owned over the 10% limit may not be voted on any matter submitted to stockholders for a vote.

**Conversion Regulations**

Federal regulations prohibit any person from making an offer, announcing an intent to make an offer or participating in any other arrangement to purchase stock or acquiring stock or subscription rights in a converting institution or its holding company from another person before completion of its conversion. Further, without the FDIC's prior written approval, no person may make an offer or announcement of an offer to purchase shares or actually acquire shares of a converted institution or its holding company for a period of three years from the date of the completion of the conversion if, upon the completion of such offer, announcement or acquisition, the person would become the beneficial owner of more than 10% of the outstanding stock of the institution or its holding company. The FDIC has defined "person" to include any individual, group acting in concert, corporation, partnership, association, joint stock company, trust, unincorporated organization or similar company, a syndicate or any other group formed for the purpose of acquiring, holding or disposing of securities of an insured institution. However, offers made exclusively to a bank or its holding company, or an underwriter or member of a selling group acting on the converting institution's or its holding company's behalf for resale to the general public are excepted. The regulation also provides civil penalties for willful violation or assistance in any such violation of the regulation by any person connected with the management of the converting institution or its holding company or who controls more than 10% of the outstanding shares or voting rights of a converted institution or its holding company.

**Change in Control Laws and Regulations**

Under the Change in Bank Control Act, no person, or group of persons acting in concert, may acquire control of a bank holding company such as Mercer Bancorp unless the Federal Reserve Board has been given 60 days' prior written notice and not disapproved the proposed acquisition. The Federal Reserve Board considers several factors in evaluating a notice, including the financial and managerial resources of the acquirer and competitive effects. Control, as defined under the Change in Bank Control Act and applicable regulations, means the power, directly or indirectly, to direct the management or policies of the company or to vote 25% or more of any class of voting securities of the company. Acquisition of more than 10% of any class of a bank holding company's voting securities constitutes a rebuttable presumption of control under certain circumstances, including where, as will be the case with Mercer Bancorp, the issuer has registered securities under Section 12 of the Securities Exchange Act of 1934.

In addition, federal regulations provide that no company may acquire control of a bank holding company without the prior approval of the Federal Reserve Board. Control, as defined under the Bank Holding Company Act and Federal Reserve Board regulations, means ownership, control or power to vote 25% or more of any class of voting stock, control in any manner over the election of a majority of the company's directors, or a determination by the Federal Reserve Board that the acquiror has the power to exercise, directly or indirectly, a controlling influence over the management or policies of the company. Any company that acquires such control becomes a "bank holding company" subject to registration, examination and regulation by the Federal Reserve Board. Relevant factors concerning when a company exercises a controlling influence over a bank or bank holding company include the company's voting and nonvoting equity investment in the bank or bank holding company, director, officer and employee overlap and the scope of business relationships between the company and bank or bank holding company.

**DESCRIPTION OF CAPITAL STOCK OF MERCER BANCORP**

**General**

Mercer Bancorp is authorized to issue 9,000,000 shares of common stock, par value of $0.01 per share, and 1,000,000 shares of preferred stock, par value $0.01 per share. Mercer Bancorp currently expects to issue in the stock offering up to 1,495,000 shares of common stock and contribute 50,000 shares of common stock to the charitable foundation. It will not issue shares of preferred stock in the stock offering or contribute shares of preferred stock to the charitable foundation. Each share of Mercer Bancorp common stock will have the same relative rights as, and will be identical in all respects to, each other share of common stock. Upon payment of the subscription price for the common stock according to the plan of conversion all of the shares of common stock will be duly authorized, fully paid and nonassessable.

The shares of common stock of Mercer Bancorp will represent non-withdrawable capital, will not be an account of an insurable type, and will not be insured by the FDIC or any other government agency.

**Common Stock**

***Dividends.*** Mercer Bancorp can pay dividends on its common stock if, after giving effect to such distribution, (i) it would be able to pay its indebtedness as the indebtedness comes due in the usual course of business and (ii) its total assets exceed the sum of its liabilities and the amount needed, if it were to be dissolved at the time of the distribution, to satisfy the preferential rights upon dissolution of any holders of capital stock who have a preference in the event of dissolution. The holders of common stock of Mercer Bancorp will be entitled to receive and share equally in dividends as may be declared by the board of directors out of funds legally available therefor. If Mercer Bancorp issues shares of preferred stock, the holders of preferred stock may have a priority over the holders of the common stock with respect to dividends.

***Voting Rights.*** Upon consummation of the conversion and stock offering, the holders of common stock of Mercer Bancorp will have exclusive voting rights in Mercer Bancorp. They will elect its board of directors and act on other matters as are required to be presented to them under Maryland law or as are otherwise presented to them by the board of directors. Generally, each holder of common stock will be entitled to one vote per share and will not have any right to cumulate votes in the election of directors. Any person who beneficially owns more than 10% of the then-outstanding shares of Mercer Bancorp's common stock, however, will not be entitled or permitted to vote any shares of common stock held in excess of the 10% limit. If Mercer Bancorp issues shares of preferred stock, holders of the preferred stock may also possess voting rights. Amendments to the articles of incorporation generally require a two-thirds vote, and certain amendments require an 80% stockholder vote.

As a stock bank, corporate powers and control of Mercer Savings Bank will be vested in its board of directors, who elect the officers of Mercer Savings Bank and who fill any vacancies on the board of directors. Voting rights of Mercer Savings Bank will be vested exclusively in the owner of the shares of capital stock of Mercer Savings Bank, which will be Mercer Bancorp, and voted at the direction of Mercer Bancorp's board of directors. Consequently, the holders of the common stock of Mercer Bancorp will not have direct control of Mercer Savings Bank.

***Liquidation.*** In the event of any liquidation, dissolution or winding up of Mercer Savings Bank, Mercer Bancorp, as the holder of all of Mercer Savings Bank's capital stock, would be entitled to receive all assets of Mercer Savings Bank available for distribution, after payment or provision for payment of all debts and liabilities of Mercer Savings Bank, including all deposit accounts and accrued interest thereon, and after distribution of the balance in the liquidation account to Eligible Account Holders. In the event of liquidation, dissolution or winding up of Mercer Bancorp, the holders of its common stock would be entitled to receive, after payment or provision for payment of all its debts and liabilities, all of the assets of Mercer Bancorp available for distribution. If preferred stock is issued by Mercer Bancorp, the holders thereof may have a priority over the holders of the common stock in the event of liquidation or dissolution.

***Preemptive Rights; Redemption.*** Holders of the common stock of Mercer Bancorp will not be entitled to preemptive rights with respect to any shares that may be issued, unless such preemptive rights are approved by the board of directors. The common stock is not subject to redemption.

**Preferred Stock**

None of the shares of Mercer Bancorp's authorized preferred stock will be issued as part of the conversion and stock offering. Preferred stock may be issued with preferences and designations as our board of directors may from time to time determine. Our board of directors may, without stockholder approval, issue shares of preferred stock with voting, dividend, liquidation and conversion rights that could dilute the voting strength of the holders of the common stock and may assist management in impeding an unfriendly takeover or attempted change in control.

**TRANSFER AGENT**

The transfer agent and registrar for Mercer Bancorp's common stock will be [transfer agent].

**EXPERTS**

The financial statements of Mercer Savings Bank at September 30, 2022 and 2021 and for each of the years ended September 30, 2022 and 2021 have been included herein in reliance upon the report of S.R. Snodgrass, P.C., independent registered public accounting firm, which is included in this prospectus and upon the authority of said firm as experts in accounting and auditing.

FinPro Capital Advisors, Inc. has consented to the publication in this prospectus of the summary of its report to Mercer Bancorp setting forth its opinion as to the estimated pro forma market value of the shares of common stock upon completion of the conversion and stock offering and of its letter with respect to subscription rights.

**CHANGE IN AUDITOR**

On April 19, 2022, Mercer Savings Bank dismissed its previous independent auditors, Crowe LLP, and engaged Dixon, Davis, Bagent & Company ("Dixon Davis") as its independent auditor. This change in auditors was approved by Mercer Savings Bank's board of directors. Dixon Davis was engaged to audit the financial statements of Mercer Savings Bank for the year ended September 30, 2022 according to auditing standards of the American Institute of Certified Public Accountants.

Before the engagement of Dixon Davis, Mercer Savings Bank did not consult with Dixon Davis regarding the application of accounting principles to a specific completed or proposed transaction or regarding the type of audit opinion that might be rendered by Dixon Davis on Mercer Savings Bank's financial statements, and Dixon Davis did not provide any written or oral advice that was an important factor considered by Mercer Savings Bank in reaching a decision as to any such accounting, auditing or financial reporting issue, and Mercer Savings Bank did not consult with Dixon Davis regarding any of the matters or events set forth in Item 304(a)(2)(ii) of Regulation S-K.

The report of Crowe LLP on its audit of the financial statements of Mercer Savings Bank for the years ended September 30, 2021 and 2020, which was conducted in accordance with auditing standards generally accepted in the United States of America, did not contain an adverse opinion or disclaimer of opinion and was not qualified or modified as to uncertainty, audit scope or accounting principle. In connection with its audit of the financial statements of Mercer Savings Bank for the years ended September 30, 2021 and 2020 and during the interim period ended April 19, 2022, there were no disagreements with Crowe LLP on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of Crowe LLP, would have caused them to make reference thereto in their reports, and there have been no reportable events as described in Item 304(a)(1)(v) of Regulation S-K.

Mercer Savings Bank provided Crowe LLP with a copy of this disclosure before its filing with the Securities and Exchange Commission and requested that Crowe LLP furnish Mercer Savings Bank with a letter addressed to the Securities and Exchange Commission stating whether it agrees with the above statements and, if it does not agree, the respects in which it does not agree. A copy of the letter is filed as an exhibit to the registration statement of Mercer Bancorp, of which this prospectus is a part.

On January 17, 2023, Mercer Savings Bank dismissed Dixon Davis and engaged Snodgrass as its independent auditor. This change in auditors was approved by Mercer Savings Bank's board of directors in connection with Mercer Savings Bank's determination to proceed with the conversion and stock offering. Snodgrass was engaged to audit the financial statements of Mercer Savings Bank for the years ended September 30, 2022 and 2021 according to auditing standards of the Public Company Accounting Oversight Board.

Before the engagement of Snodgrass, Mercer Savings Bank did not consult with Snodgrass regarding the application of accounting principles to a specific completed or proposed transaction or regarding the type of audit opinion that might be rendered by Snodgrass on Mercer Savings Bank's financial statements, and Snodgrass did not provide any written or oral advice that was an important factor considered by Mercer Savings Bank in reaching a decision as to any such accounting, auditing or financial reporting issue, and Mercer Savings Bank did not consult with Snodgrass regarding any of the matters or events set forth in Item 304(a)(2)(ii) of Regulation S-K.

The report of Dixon Davis on its audit of the financial statements of Mercer Savings Bank for the year ended September 30, 2022 did not contain an adverse opinion or disclaimer of opinion and was not qualified or modified as to uncertainty, audit scope or accounting principle. In connection with its audit of the financial statements of Mercer Savings Bank for the year ended September 30, 2022, and during the interim period ended January 17, 2023, there were no disagreements with Dixon Davis on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of Dixon Davis, would have caused them to make reference thereto in their reports, and there have been no reportable events as described in Item 304(a)(1)(v) of Regulation S-K.

Mercer Savings Bank provided Dixon Davis with a copy of this disclosure before its filing with the Securities and Exchange Commission and requested that Dixon Davis furnish Mercer Savings Bank with a letter addressed to the Securities and Exchange Commission stating whether it agrees with the above statements and, if it does not agree, the respects in which it does not agree. A copy of the letter is filed as an exhibit to the registration statement of Mercer Bancorp, of which this prospectus is a part.

**LEGAL MATTERS**

Luse Gorman, PC, Washington, D.C., counsel to Mercer Bancorp and Mercer Savings Bank, has issued to Mercer Bancorp its opinion regarding the legality of the common stock and has issued to Mercer Bancorp and Mercer Savings Bank its opinion regarding the federal income tax consequences of the conversion and stock offering. S.R. Snodgrass, P.C., Cranberry Township, PA, has issued its opinion to Mercer Bancorp and Mercer Savings Bank regarding the Ohio state income tax consequences of the conversion and stock offering. Certain legal matters will be passed upon for Performance Trust by Nelson Mullins Riley & Scarborough LLP, Atlanta, GA.

**WHERE YOU CAN FIND ADDITIONAL INFORMATION**

Mercer Bancorp has filed with the Securities and Exchange Commission a registration statement under the Securities Act of 1933, as amended, with respect to the shares of common stock offered hereby. As permitted by the rules and regulations of the Securities and Exchange Commission, this prospectus does not contain all the information set forth in the registration statement. Such information, including the appraisal report which is an exhibit to the registration statement, may be found at the web site of the Securities and Exchange Commission (www.sec.gov) that contains reports, proxy and information statements and other information regarding registrants that file electronically with the Securities and Exchange Commission, including Mercer Bancorp. The statements contained in this prospectus as to the contents of any contract or other document filed as an exhibit to the registration statement are, of necessity, brief descriptions of the material terms of, and should be read in conjunction with, such contract or document.

Mercer Savings Bank has filed an application with the ODFI and a notice with the FDIC with respect to the conversion. This prospectus omits certain information contained in the application. Non-confidential portions of the conversion application may be examined at the FDIC Central District Office located at 425 S. Financial Place, Suite 1700, Chicago, Illinois 60605. A copy of the plan of conversion is available for review at Mercer Savings Bank's office.

In connection with the conversion and stock offering, Mercer Bancorp will register its common stock under Section 12 of the Securities Exchange Act of 1934. Upon registration, Mercer Bancorp and the holders of its common stock will become subject to the proxy solicitation rules, reporting requirements and restrictions on common stock purchases and sales by directors, officers and greater than 10% stockholders, the annual and periodic reporting and certain other requirements of the Securities Exchange Act of 1934. Under the plan of conversion, Mercer Bancorp has undertaken that it will not terminate such registration for a period of at least three years following the consummation of the conversion and stock offering.

**INDEX TO FINANCIAL STATEMENTS OF MERCER SAVINGS BANK**

---

| | |
|:---|:---|
| [Report of Independent Registered Public Accounting Firm](#sub_008) | [F-2](#sub_008) |
| [Balance Sheets at December 31, 2022 (unaudited) and September 30, 2022 and 2021](#sub_009) | [F-3](#sub_009) |
| [Statements of Income for the Three Months Ended December 31, 2022 and 2021 (unaudited) and the Years Ended September 30, 2022 and 2021](#sub_010) | [F-4](#sub_010) |
| [Statements of Comprehensive Income (Loss) for the Three Months Ended December 31, 2022 and 2021 (unaudited) and the Years Ended September 30, 2022 and 2021](#sub_011) | [F-5](#sub_011) |
| [Statements of Changes in Equity for the Three Months Ended December 31, 2022 (unaudited) and the Years Ended September 30, 2022 and 2021](#sub_012) | [F-6](#sub_012) |
| [Statements of Cash Flows for the Three Months Ended December 31, 2022 and 2021 (unaudited) and the Years Ended September 30, 2022 and 2021](#sub_013) | [F-7](#sub_013) |
| [Notes to Financial Statements](#sub_014) | [F-8](#sub_014) |

---

\# \# \#

Separate financial statements for Mercer Bancorp have not been included in this prospectus because it has not engaged in any significant activities, has no significant assets, and has no contingent liabilities, revenue or expenses.

All financial statement schedules have been omitted as the required information either is not applicable or is included in the financial statements or related notes.

<u>REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM</u>

![](tm238570d1_s1-img06.jpg)

To the Board of Directors of Mercer Savings Bank

**Opinion on the Financial Statements**

We have audited the accompanying balance sheets of Mercer Savings Bank (the "Bank") as of September 30, 2022 and 2021; the related statements of income, comprehensive income, changes in equity, and cash flows for the years then ended; and the related notes to the consolidated financial statements (collectively, the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Bank as of September 30, 2022 and 2021, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.

**Basis for Opinion**

These financial statements are the responsibility of the Bank's management. Our responsibility is to express an opinion on the Bank's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent, with respect to the Bank, in accordance with U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Bank is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Bank's internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

We have served as the Bank's auditor since 2023.

![](tm238570d1_s1-img07.jpg)

Cranberry Township, Pennsylvania

March 10, 2023

---

| | | | |
|:---|:---|:---|:---|
| PITTSBURGH, PA | PHILADELPHIA, PA | WHEELING, WV | STEUBENVILLE, OH |
| 2009 Mackenzie Way • Suite 340 | 2100 Renaissance Blvd. • Suite 110 | 980 National Road | 511 N. Fourth Street |
| Cranberry Township, PA 16066 | King of Prussia, PA 19406 | Wheeling, WV 26003 | Steubenville, OH 43952 |
| (724) 934-0344 | (610) 278-9800 | (304) 233-5030 | (304) 233-5030 |

---

S.R. Snodgrass, P.C. d/b/a S.R. Snodgrass, A.C. in West Virginia

**Mercer Savings Bank**

**Balance Sheets**

**December 31, 2022 (Unaudited) and September 30, 2022 and 2021**

---

| | | | |
|:---|:---|:---|:---|
|  | | **September 30,** | **September 30,** |
|  | **December 31,**<br>**2022** | **2022** | **2021** |
| **Assets** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash and due from banks | $1368868 | $1361198 | $1175770 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest-bearing deposits in other financial institutions | 5833893 | 13015520 | 16824820 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash and cash equivalents | 7202761 | 14376718 | 18000590 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest-bearing time deposits | 100000 | 100000 | 100000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Available-for-sale securities | 13321073 | 12572195 | 8585390 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Held-to-maturity securities | 212348 | 233388 | 338736 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loans held for sale | 281500 |  | 399000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loans receivable | 118791045 | 118654254 | 113468982 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Allowance for loan losses | (960875) | (983654) | (957903) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net loans | 117830170 | 117670600 | 112511079 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Premises and equipment | 2602787 | 2608291 | 2415845 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Federal Home Loan Bank stock | 1390200 | 1390200 | 1605300 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Bank owned life insurance | 1752562 | 1742464 | 2066444 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued interest receivable | 368976 | 376903 | 319688 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Federal Home Loan Bank lender risk account | 516457 | 516457 | 558222 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred federal income taxes | 230518 | 272051 | 17509 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other assets | 380275 | 1023484 | 427020 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total assets | $146189627 | $152882751 | $147344823 |
| **Liabilities and Equity** |  |  |  |
| &nbsp;&nbsp;&nbsp;**Liabilities** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deposits |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Demand | $59534317 | $65323642 | $56237432 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Savings and money market | 45075093 | 44168770 | 41415704 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Time | 23089438 | 25266231 | 30592154 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total deposits | 127698848 | 134758643 | 128245290 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Advances from the Federal Home Loan Bank | 3000000 | 3000000 | 4000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Directors plan liability | 560888 | 565181 | 554907 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued interest payable and other liabilities | 404222 | 502597 | 481894 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities | 131663958 | 138826421 | 133282091 |
| &nbsp;&nbsp;&nbsp;**Commitments and Contingencies** |  |  |  |
| &nbsp;&nbsp;&nbsp;**Equity** |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Retained earnings | 15288471 | 14959892 | 14016304 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accumulated other comprehensive (loss) income | (762802) | (903562) | 46428 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total equity | 14525669 | 14056330 | 14062732 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities and equity | $146189627 | $152882751 | $147344823 |

---

*See Notes to Financial Statements*

**Mercer Savings Bank**

**Statements of Income**

**Three Months Ended December 31, 2022 and 2021 (Unaudited) and Years Ended**

**September 30, 2022 and 2021**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Year Ended** | **Year Ended** |
|  | **December 31,** | **December 31,** | **September 30,** | **September 30,** |
|  | **2022** | **2021** | **2022** | **2021** |
| **Interest Income** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Loans | $1222045 | $1072473 | $4322281 | $4342946 |
| &nbsp;&nbsp;&nbsp;Investment securities | 66310 | 22574 | 120146 | 82135 |
| &nbsp;&nbsp;&nbsp;Interest-bearing deposits and other | 105406 | 10487 | 152532 | 35632 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total interest income | 1393761 | 1105534 | 4594959 | 4460713 |
| **Interest Expense** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Deposits | 48609 | 63515 | 232587 | 362530 |
| &nbsp;&nbsp;&nbsp;Federal Home Loan Bank advances | 7209 | 9074 | 32292 | 38913 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total interest expense | 55818 | 72589 | 264879 | 401443 |
| **Net Interest Income** | 1337943 | 1032945 | 4330080 | 4059270 |
| **Provision for Loan Losses** | - | 15000 | 25000 | 180000 |
| **Net Interest Income After Provision <br> for Loan Losses** | 1337943 | 1017945 | 4305080 | 3879270 |
| **Noninterest Income** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Service fees on deposits | 75915 | 81848 | 327785 | 318490 |
| &nbsp;&nbsp;&nbsp;Late charges and fees on loans | 24941 | 29232 | 122729 | 141835 |
| &nbsp;&nbsp;&nbsp;Gain on sale of loans |  | 36440 | 52605 | 99797 |
| &nbsp;&nbsp;&nbsp;Loan servicing fees | 10066 | 24381 | 48030 | 30086 |
| &nbsp;&nbsp;&nbsp;Loss on sale of investments | (8049) |  |  |  |
| &nbsp;&nbsp;&nbsp;Bank owned life insurance | 14381 | 11313 | 53126 | 44860 |
| &nbsp;&nbsp;&nbsp;Life insurance death benefits | 4515 |  | 169069 |  |
| &nbsp;&nbsp;&nbsp;Other income | 5552 | 5142 | 21057 | 21238 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total noninterest income | 127321 | 188356 | 794401 | 656306 |
| **Noninterest Expense** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Salaries and employee benefits | 535960 | 505377 | 2074632 | 1923858 |
| &nbsp;&nbsp;&nbsp;Directors fees | 20175 | 18825 | 84250 | 77800 |
| &nbsp;&nbsp;&nbsp;Occupancy and equipment | 112993 | 84629 | 340113 | 360862 |
| &nbsp;&nbsp;&nbsp;Data processing fees | 130564 | 108225 | 454061 | 426736 |
| &nbsp;&nbsp;&nbsp;Franchise taxes | 19999 | 21712 | 87945 | 85214 |
| &nbsp;&nbsp;&nbsp;FDIC insurance premiums | 10264 | 10114 | 41510 | 39496 |
| &nbsp;&nbsp;&nbsp;Professional services | 51353 | 51647 | 148424 | 165688 |
| &nbsp;&nbsp;&nbsp;Deposit account services expense | 60997 | 57434 | 239797 | 232918 |
| &nbsp;&nbsp;&nbsp;Advertising | 21939 | 22959 | 101346 | 94930 |
| &nbsp;&nbsp;&nbsp;Loan expenses | 19880 | 21168 | 77210 | 113017 |
| &nbsp;&nbsp;&nbsp;Loss on sale of foreclosed real estate |  |  |  | 35486 |
| &nbsp;&nbsp;&nbsp;Other | 76161 | 74584 | 313551 | 265567 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total noninterest expense | 1060285 | 976674 | 3962839 | 3821572 |
| **Income before income taxes** | 404979 | 229627 | 1136642 | 714004 |
| **Provision for income taxes** | 76400 | 50300 | 193054 | 142745 |
| **Net Income** | $328579 | $179327 | $943588 | $571259 |

---

*See Notes to Financial Statements*

**Mercer Savings Bank**

**Statements of Comprehensive Income (Loss)**

**Three Months Ended December 31, 2022 and 2021 (Unaudited) and Years Ended**

**September 30, 2022 and 2021**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Year Ended** | **Year Ended** |
|  | **December 31,** | **December 31,** | **September 30,** | **September 30,** |
|  | **2022** | **2021** | **2022** | **2021** |
| Net income | $328579 | $179327 | $943588 | $571259 |
| Other comprehensive income (loss): |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Net unrealized gains (losses) on available-for-sale securities | 170128 | (67267) | (1202519) | (45192) |
| &nbsp;&nbsp;&nbsp;Reclassification adjustment for realized loss on sales of securities | 8049 |  |  |  |
| &nbsp;&nbsp;&nbsp;Tax (expense) benefit | (37417) | 14126 | 252529 | 9490 |
| Other comprehensive income (loss) | 140760 | (53141) | (949990) | (35702) |
| Comprehensive income | $469339 | $126186 | $(6402) | $535557 |

---

*See Notes to Financial Statements*

**Mercer Savings Bank**

**Statements of Changes in Equity**

**Three Months Ended December 31, 2022 (Unaudited) and Years Ended**

**September 30, 2022 and 2021**

---

| | | | |
|:---|:---|:---|:---|
|  |<br>**Retained**<br>**Earnings** | **Accumulated**<br>**Other**<br>**Comprehensive**<br>**Income (Loss)** |<br><br>**Total** |
| Balance at October 1, 2020 | $13445045 | $82130 | $13527175 |
| Net income | 571259 |  | 571259 |
| Other comprehensive loss | - | (35702) | (35702) |
| Balance at September 30, 2021 | 14016304 | 46428 | 14062732 |
| Net income | 943588 |  | 943588 |
| Other comprehensive loss | - | (949990) | (949990) |
| Balance at September 30, 2022 | $14959892 | $(903562) | $14056330 |
| Balance at October 1, 2021 | $14016304 | $46428 | $14062732 |
| Net income | 179327 |  | 179327 |
| Other comprehensive loss | - | (53141) | (53141) |
| Balance at December 31, 2021 | $14195631 | $(6713) | $14188918 |
| Balance at October 1, 2022 | $14959892 | $(903562) | $14056330 |
| Net income | 328579 |  | 328579 |
| Other comprehensive income | - | 140760 | 140760 |
| Balance at December 31, 2022 | $15288471 | $(762802) | $14525669 |

---

*See Notes to Financial Statements*

**Mercer Savings Bank**

**Statements of Cash Flows**

**Three Months Ended December 31, 2022 and 2021 (Unaudited) and Years Ended**

**September 30, 2022 and 2021**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three Months Ended** | **Three Months Ended** | **Year Ended** | **Year Ended** |
|  | **December 31,** | **December 31,** | **September 30,** | **September 30,** |
|  | **2022** | **2021** | **2022** | **2021** |
| **Operating Activities** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Net income | $328579 | $179327 | $943588 | $571259 |
| &nbsp;&nbsp;&nbsp;Items not requiring (providing) cash: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 74463 | 55780 | 212098 | 264799 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization of premiums and discounts | 15962 | 18524 | 113250 | 55139 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization of deferred loan fees | (17635) | (31395) | (109681) | (157017) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred income taxes | 4116 | (1) | (2013) | (71302) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Provision for loan losses |  | 15000 | 25000 | 180000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gain on sale of loans |  | (36440) | (52605) | (99797) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proceeds from sales of loans |  | 1778378 | 2501171 | 3335741 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loans originated for sale | (281500) | (1353100) | (2063850) | (2532436) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loss on sale of investment securities | 8049 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loss on sale of foreclosed real estate |  |  |  | 35486 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Life insurance death benefits | (4515) |  | (169069) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Increase in cash surrender value of bank-owned life insurance | (14381) | (11313) | (53126) | (44860) |
| &nbsp;&nbsp;&nbsp;Changes in: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued interest receivable | 7927 | 21813 | (57215) | 29651 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other assets | 102613 | 75178 | (24745) | 36190 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other liabilities | (98385) | (122821) | 39680 | (21674) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash provided by operating activities | 125293 | 588930 | 1302483 | 1581179 |
| **Investing Activities** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Purchases of available-for-sale securities | (1273478) | (1005500) | (6402241) | (7236702) |
| &nbsp;&nbsp;&nbsp;Proceeds from sales of available-for-sale securites | 519438 |  |  |  |
| &nbsp;&nbsp;&nbsp;Proceeds from calls, maturities and paydowns <br> of available-for-sale securities | 160050 | 135707 | 1103763 | 1391482 |
| &nbsp;&nbsp;&nbsp;Principal repayments on securities held-to-maturity | 20318 | 32090 | 101252 | 148978 |
| &nbsp;&nbsp;&nbsp;Net change in loans | (159935) | (534079) | (5074840) | (4917279) |
| &nbsp;&nbsp;&nbsp;Purchase of premises and equipment | (65835) | (1285) | (382742) | (30684) |
| &nbsp;&nbsp;&nbsp;Proceeds from redemption of FHLB stock |  |  | 215100 |  |
| &nbsp;&nbsp;&nbsp;Proceeds from sale of foreclosed real estate | 18000 |  |  | 29678 |
| &nbsp;&nbsp;&nbsp;Proceeds from death benefit of life insurance policies | 541987 | - | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash used in investing activities | (239455) | (1373067) | (10439708) | (10614527) |
| **Financing Activities** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Net increase (decrease) in deposit accounts | (7059795) | 3285511 | 6513353 | 12513318 |
| &nbsp;&nbsp;&nbsp;Repayment of FHLB advances | - | - | (1000000) | (1000000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash (used in) provided by financing activities | (7059795) | 3285511 | 5513353 | 11513318 |
| **(Decrease) Increase in Cash and Cash Equivalents** | (7173957) | 2501374 | (3623872) | 2479970 |
| **Cash and Cash Equivalents, Beginning of Period** | 14376718 | 18000590 | 18000590 | 15520620 |
| **Cash and Cash Equivalents, End of Period** | $7202761 | $20501964 | $14376718 | $18000590 |
| **Supplemental Disclosure of Cash Flow Information** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Cash paid during the period for: |  |  |  |  |
| &nbsp;&nbsp;&nbsp; Interest on deposits and borrowings | $55894 | $72857 | $265929 | $402222 |
| &nbsp;&nbsp;&nbsp; Income taxes |  |  | 211663 | 217000 |
| **Supplemental Disclosure of Noncash Investing Activities** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Transfers from loans to real estate acquired through foreclosure | $- | $- | $- | $65164 |

---

*See Notes to Financial Statements*

 

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

---

| | |
|:---|:---|
| **Note 1:** | **Nature of Operations and Summary of Significant Accounting Policies** |

---

***Inclusion of Unaudited Information***

The financial information included herein as of December 31, 2022 and for the interim three month periods ended December 31, 2022 and 2021 is unaudited. However, in management's opinion, the information reflects all normal, recurring adjustments that are necessary for a fair presentation. The results shown for the three months ended December 31, 2022 and 2021 are not necessarily indicative of the results to be obtained for a full year.

***Nature of Operations***

Mercer Savings Bank ("Bank") is an Ohio chartered mutual thrift engaged primarily in the business of providing a variety of deposit and lending services to individual customers in western Ohio. Its primary deposit products are checking, savings, and term certificate accounts, and its primary lending products are residential and commercial mortgage, commercial, home equity lines of credit and installment loans. Its operations are conducted through its four office locations in Celina, Ft. Recovery and Greenville, Ohio. The Bank faces competition from other financial institutions and is subject to the regulation of certain federal and state agencies and undergoes periodic examinations by those regulatory authorities.

***Use of Estimates***

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for loan losses, valuation of real estate acquired in connection with foreclosures or in satisfaction of loans, valuation of mortgage servicing rights and deferred tax assets and fair values of financial instruments.

***Cash Equivalents***

The Bank considers all liquid investments with original maturities of three months or less to be cash equivalents. At December 31, 2022, (unaudited) September 30, 2022 and 2021, none of the Bank's cash accounts at nonfederal government or nongovernmental agencies exceeded FDIC insurance limits.

In March 2020, the Federal Reserve's board of directors approved reducing the required reserve requirement ratios to zero percent, effectively eliminating the requirement to maintain reserve balances in cash or on deposit with the Federal Reserve Bank. This reduction in the required reserves does not have a defined timeframe and may be revised by the Federal Reserve's board in the future.

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

***Interest-bearing Time Deposits in Banks***

Interest-bearing time deposits have original maturities greater than one year and are carried at cost.

***Debt Securities***

Debt securities held by the Bank generally are classified and recorded in the financial statements as follows:

---

| | | |
|:---|:---|:---|
| Classified as | Description | Recorded at |
| Held to maturity (HTM) | Certain debt securities that management has the positive intent and ability to hold to maturity | Amortized cost |
| Trading | Securities that are bought and held principally for the purpose of selling in the near term and, therefore, held for only a short period of time | Fair value, with changes in fair value included in earnings |
| Available for sale (AFS) | Securities not classified as HTM or trading | Fair value, with urealized gains and losses excluded from earnings and reported in other comprehensive income |

---

Purchase premiums and discounts are recognized in interest income using the interest method over the terms of the securities, identified as the call date as to premiums and maturity date as to discounts. Gains and losses on the sale of securities are recorded on the trade date and are determined using the specific identification method.

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

When the fair value of securities is below amortized cost, the Bank's accounting treatment for an other-than-temporary impairment ("OTTI") is as follows:

---

| | | |
|:---|:---|:---|
|  | Accounting Treatment for OTTI <br> Components | Accounting Treatment for OTTI <br> Components |
| Circumstances of Impairment | Credit | Remaining |
| Considerations | Component | Portion |
| Not intended for sale and more likely than not that the Bank will not have to sell before recovery of cost basis | Recognized in earnings | Recognized in other comprehensive income |
| Intended for sale or more likely than not that the Bank will be required to sell before recovery of cost basis | Recognized in earnings | Recognized in earnings |

---

For held-to-maturity debt securities, the amount of OTTI recorded in other comprehensive income for the noncredit portion of a previous OTTI is amortized prospectively over the remaining life of the security on the basis of the timing of future estimated cash flows of the security.

When a credit loss component is separately recognized in earnings, the amount is identified as the total of principal cash flows not expected to be received over the remaining term of the security, as projected based on cash flow projections.

The Bank recognized no other-than-temporary impairments on debt securities in the three-month periods ended December 31, 2022 and 2021 (unaudited) and the years ended September 30, 2022 or 2021.

***Loans Held for Sale***

Mortgage loans originated and intended for sale in the secondary market are carried at the lower of cost or fair value in the aggregate. Net unrealized losses, if any, are recognized through a valuation allowance by charges to noninterest income. Gains and losses on loan sales are recorded in noninterest income, and direct loan origination costs and fees are deferred at origination of the loan and are recognized in noninterest income upon sale of the loan.

***Lender Risk Account (LRA)***

The Federal Home Loan Bank (FHLB) requires institutions participating in its mortgage loan sales program to place a portion of the sale proceeds in a lender risk account. The LRA is maintained to offset any credit losses associated with loans sold to the FHLB by the participating institution as well as losses experienced by the overall loan pool should an individual institution's LRA be fully exhausted. The LRA funds will begin to be distributed to participating institutions after loan pools have had five years of payment history.

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

After five years, the required LRA balance is recalculated at least annually and excess amounts are returned to the participating institutions.

***Loans***

Loans that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are reported at their outstanding principal balances, adjusted for unearned income, charge-offs, the allowance for loan losses and any unamortized deferred fees or costs on originated loans and unamortized premiums or discounts on purchased loans.

For loans amortized at cost, interest income is accrued based on the unpaid principal balance. Loan origination fees, net of certain direct origination costs, as well as premiums and discounts, are deferred and amortized as a level yield adjustment over the respective term of the loan. For all loan portfolio segments except residential and consumer loans, the Bank promptly charges-off loans, or portions thereof, when available information confirms that specific loans are uncollectible based on information that includes, but is not limited to, (1) the deteriorating financial condition of the borrower, (2) declining collateral values, and/or (3) legal action, including bankruptcy, that impairs the borrower's ability to adequately meet its obligations. For impaired loans that are considered to be solely collateral dependent, a partial charge-off is recorded when a loss has been confirmed by an updated appraisal or other appropriate valuation of the collateral.

The Bank charges-off loans, or portions thereof, when the Bank reasonably determines the amount of the loss. The Bank adheres to delinquency thresholds established by applicable regulatory guidance to determine the charge-off timeframe for these loans. Loans at these delinquency thresholds for which the Bank can clearly document that the loan is both well-secured and in the process of collection, such that collection will occur regardless of delinquency status, need not be charged off.

For all classes, all interest accrued but not collected for loans that are placed on nonaccrual or charged off is reversed against interest income. The interest on these loans is accounted for on the cash basis or cost recovery method, until qualifying for return to accrual. Loans are returned to accrual status when all the principal and interest amounts contractually due are brought current and future payments are reasonably assured. Nonaccrual loans are returned to accrual status when, in the opinion of management, the financial position of the borrower indicates there is no longer any reasonable doubt as to the timely collection of interest or principal. The Bank requires a period of satisfactory performance of not less than six months before returning a nonaccrual loan to accrual status.

When cash payments are received on impaired loans, the Bank records the payment as interest income unless collection of the remaining recorded principal amount is doubtful, at which time payments are used to reduce the principal balance of the loan. Troubled debt restructured loans recognize interest income on an accrual basis at the renegotiated rate if the loan is in compliance with the modified terms, no principal reduction has been granted and the loan has demonstrated the ability to perform in accordance with the renegotiated terms for a period of at least six months.

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

***Allowance for Loan Losses***

The allowance for loan losses is a valuation allowance for probable incurred credit losses. Loan losses are charged against the allowance when management believes the collectibility of a loan balance is doubtful. Subsequent recoveries, if any, are credited to the allowance.

The allowance for loan losses is evaluated on a quarterly basis by management and is based upon management's periodic review of the collectability of the loans in light of historical experience, the nature and volume of the loan portfolio, adverse situations that may affect the borrower's ability to repay, estimated value of any underlying collateral and prevailing economic conditions. This evaluation is inherently subjective as it requires estimates that are susceptible to significant revision as more information becomes available. The allowance consists of allocated and general components. The allocated component relates to loans that are classified as impaired. For those loans that are classified as impaired, an allowance is established when the discounted cash flows (or collateral value or observable market price) of the impaired loan is lower than the carrying value of that loan. The general component covers nonimpaired loans and is based on historical charge-off experience by segment. The historical loss experience is determined by portfolio segment and is based on the actual loss history experienced by the Bank over the prior three years. Management believes the three-year historical loss experience methodology is appropriate in the current economic environment. Other adjustments (qualitative/environmental considerations) for each segment may be added to the allowance for each loan segment after an assessment of internal or external influences on credit quality that are not fully reflected in the historical loss or risk rating data.

A loan is considered impaired when, based on current information and events, it is probable that the Bank will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the loan agreement. Factors considered by management in determining impairment include payment history, collateral value and the probability of collecting scheduled principal and interest payments when due, based on the loan's current payment status and the borrower's financial condition, including available sources of cash flows. Loans that experience insignificant payment delays and payment shortfalls generally are not classified as impaired. Management determines the significance of payment delays and payment shortfalls on a case-by-case basis, taking into consideration all of the circumstances surrounding the loan and the borrower, including the length of the delay, the reasons for the delay, the borrower's prior payment record and the amount of the shortfall in relation to the principal and interest owed. Impairment is generally measured on a loan-by-loan basis by either the present value of expected future cash flows discounted at the loan's effective interest rate, the loan's obtainable market price or the fair value of the collateral if the loan is collateral dependent. For impaired loans where the Bank utilizes the discounted cash flows to determine the level of impairment, the Bank includes the entire change in the present value of cash flows as a provision for loan losses.

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

The fair values of collateral dependent impaired loans are based on independent appraisals of the collateral. In general, the Bank acquires an updated appraisal upon identification of impairment and annually thereafter for commercial, commercial real estate and multi-family loans. If the most recent appraisal is over a year old, and a new appraisal is not performed, due to lack of comparable values or other reasons, the existing appraisal is utilized and discounted based on the age of the appraisal, condition of the subject property and overall economic conditions. After determining the collateral value as described, the fair value is calculated based on the determined collateral value less selling expenses. The potential for outdated appraisal values is considered in our determination of the allowance for loan losses through our analysis of various trends and conditions including the local economy, trends in charge-offs and delinquencies and the related qualitative adjustments assigned by the Bank. Segments of loans with similar risk characteristics are collectively evaluated for impairment based on the segment's historical loss experience adjusted for changes in trends, conditions and other relevant factors that affect repayment of the loans.

In the course of working with borrowers, the Bank may choose to restructure the contractual terms of certain loans. In this scenario, the Bank attempts to work out an alternative payment schedule with the borrower in order to optimize collectibility of the loan. Any loans that are modified are reviewed by the Bank to identify if a troubled debt restructuring ("TDR") has occurred, which is when, for economic or legal reasons related to a borrower's financial difficulties, the Bank grants a concession to the borrower that it would not otherwise consider. Terms may be modified to fit the ability of the borrower to repay in line with the borrower's current financial status, and the restructuring of the loan may include the transfer of assets from the borrower to satisfy the debt, a modification of loan terms or a combination of the two. If such efforts by the Bank do not result in a satisfactory arrangement, the loan is referred to legal counsel, at which time foreclosure proceedings are initiated. At any time prior to a sale of the property at foreclosure, the Bank may terminate foreclosure proceedings if the borrower is able to work out a satisfactory payment plan.

It is the Bank's policy that any restructured loans on nonaccrual status prior to being restructured remain on nonaccrual status until six months of satisfactory borrower performance, at which time management would consider its return to accrual status. If a loan was accruing at the time of restructuring, the Bank reviews the loan to determine if it is appropriate to continue the accrual of interest on the restructured loan.

With regard to determination of the amount of the allowance for loan losses, troubled debt restructured loans are considered to be impaired. As a result, the determination of the amount of impaired loans for each portfolio segment within troubled debt restructurings is the same as detailed previously.

***Transfers of Financial Assets***

Transfers of financial assets are accounted for as sales, when control over the assets has been relinquished. Control over transferred assets is deemed to be surrendered when the assets have been isolated from the Bank, the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets, and the Bank does not maintain effective control over the transferred assets through an agreement to repurchase them before maturity.

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

***Premises and Equipment***

Depreciable assets are stated at cost less accumulated depreciation. Depreciation is charged to expense using the straight-line method over the estimated useful lives of the assets. The estimated useful lives of depreciable assets are as follows: building and improvements are 5-40 years; furniture and fixtures are 5-10 years; information technology-related equipment is 3-5 years.

***Servicing Assets***

When mortgage loans are sold with servicing retained, servicing rights are initially recorded at fair value with the income statement effect recorded in gains on sales of loans. Fair value is based on market prices for comparable mortgage servicing contracts, when available or alternatively, is based on a valuation model that calculates the present value of estimated future net servicing income. All classes of servicing assets are subsequently measured using the amortization method which requires servicing rights to be amortized into non-interest income in proportion to, and over the period of, the estimated future net servicing income of the underlying loans. Servicing assets are included in other assets on the balance sheets.

Servicing assets are evaluated for impairment based upon the fair value of the rights as compared to carrying amount. Impairment is determined by stratifying rights into groupings based on predominant risk characteristics, such as interest rate, loan type and investor type. Impairment is recognized through a valuation allowance for an individual grouping, to the extent that fair value is less than the carrying amount. If the Bank later determines that all or a portion of the impairment no longer exists for a particular grouping, a reduction of the allowance may be recorded as an increase to income. No changes in valuation allowances have been reported on the income statements. The fair values of servicing rights are subject to significant fluctuations as a result of changes in estimated and actual prepayment speeds and default rates and losses.

Servicing fee income, which is reported on the income statement as other noninterest income, is recorded for fees earned for servicing loans. The fees are based on a contractual percentage of the outstanding principal; or a fixed amount per loan and are recorded as income when earned. The amortization of mortgage servicing rights is netted against loan servicing fee income.

***Federal Home Loan Bank Stock***

Federal Home Loan Bank ("FHLB") stock is a required investment for institutions that are members of the FHLB system and the transfer of the stock is substantially restricted. The required investment in the common stock is based on a predetermined formula. FHLB stock is carried at cost. FHLB stock is evaluated for impairment on an annual basis. The Bank's investment in FHLB stock was not impaired at December 31, 2022 and September 30, 2022 and 2021.

***Bank Owned Life Insurance***

The Bank has purchased life insurance on directors. Bank owned life insurance is recorded at the amount that can be realized under the insurance contract at the balance sheet date, which is the cash surrender value adjusted for other charges or other amounts due that are probable at settlement.

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

***Foreclosed Assets Held for Sale***

Assets acquired through, or in lieu of, loan foreclosure are held for sale and are initially recorded at fair value less cost to sell at the date of foreclosure, establishing a new cost basis. Subsequent to foreclosure, valuations are periodically performed by management and the assets are carried at the lower of carrying amount or fair value less cost to sell. Revenue and expenses from operations and changes in the valuation allowance are included in net income or expense from foreclosed assets.

At December 31, 2022, (unaudited) and September 30, 2022 and 2021, the Bank had no foreclosed residential real estate properties.

At December 31, 2022, (unaudited) and September 30, 2022 and 2021, the Bank had no consumer mortgage loans secured by residential real estate properties for which formal foreclosure proceeds are in process.

***Income Taxes***

The Bank accounts for income taxes in accordance with income tax accounting guidance (Accounting Standards Codification ("ASC") 740, *Income Taxes*). The income tax accounting guidance results in two components of income tax expense: current and deferred. Current income tax expense reflects taxes to be paid or refunded for the current period by applying the provisions of the enacted tax law to the taxable income or excess of deductions over revenues. The Bank determines deferred income taxes using the liability (or balance sheet) method. Under this method, the net deferred tax asset or liability is based on the tax effects of the differences between the book and tax basis of assets and liabilities, and enacted changes in tax rates and laws are recognized in the period in which they occur.

Deferred income tax expense results from changes in deferred tax assets and liabilities between periods. Deferred tax assets are reduced by a valuation allowance if, based on the weight of evidence available, it is more likely than not that some portion or all of a deferred tax asset will not be realized.

Tax positions are recognized if it is more likely than not, based on the technical merits, that the tax position will be realized or sustained upon examination. The term more likely than not means a likelihood of more than 50 percent; the terms examined and upon examination also include resolution of the related appeals or litigation processes, if any. A tax position that meets the more-likely-than-not recognition threshold is initially and subsequently measured as the largest amount of tax benefit that has a greater than 50 percent likelihood of being realized upon settlement with a taxing authority that has full knowledge of all relevant information.

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

The determination of whether or not a tax position has met the more-likely-than-not recognition threshold considers the facts, circumstances and information available at the reporting date and is subject to management's judgment.

If necessary, the Bank recognizes interest and penalties on income taxes as a component of income tax expense.

With a few exceptions, the Bank is no longer subject to examination by tax authorities for calendar years before 2019. As of December 31, 2022, (unaudited) and September 30, 2022 and 2021, the Bank had no material uncertain income tax positions.

***Comprehensive Income***

Comprehensive income consists of net income and other comprehensive income (loss), net of applicable income taxes. Other comprehensive income (loss) includes unrealized appreciation (depreciation) on available-for-sale securities and, if necessary, unrealized appreciation (depreciation) on available-for-sale securities for which a portion of an other-than-temporary impairment has been recognized in income.

Accumulated other comprehensive (loss) income consists solely of the cumulative unrealized gains and losses on available-for-sale securities, net of tax.

***Revenue Recognition***

The Bank accounts for certain revenues in accordance with Accounting Standards Update ("ASU") 2014-09 *Revenue from Contracts with Customers* (ASC 606) and all subsequent ASUs that modified ASC 606. ASC 606 provides that an entity should recognize revenue to depict the transfer of promised goods and services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Interest income, net securities gains (losses), gain on sale of loans and income from bank-owned life insurance are not included within the scope of ASC 606. For the revenue streams in the scope of ASC 606, service charges on deposits and electronic banking fees, there are no significant judgments related to the amount and timing of revenue recognition. All of the Bank's in scope revenue from contracts with customers is recognized within other noninterest income.

*Deposit Services.* The Bank generates revenues through fees charged to depositors related to deposit account maintenance fees, overdrafts, ATM fees, wire transfers and additional miscellaneous services provided at the request of the depositor.

For deposit-related services, revenue is recognized when performance obligations are satisfied, which is, generally, at a point in time.

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

---

| | |
|:---|:---|
| **Note 2:** | **Future Change in Accounting Principle** |

---

The FASB issued ASU No. 2016-13, *Financial Instruments—Credit Losses (Topic 326)*. The ASU introduced a new credit loss model, the current expected credit loss model ("CECL"), which requires earlier recognition of credit losses, while also providing additional transparency about credit risk.

The CECL model utilizes a lifetime "expected credit loss" measurement objective for the recognition of credit losses for loans, held-to-maturity securities and other receivables at the time the financial asset is originated or acquired. The expected credit losses are adjusted each period for changes in expected lifetime credit losses. For available-for-sale securities where fair value is less than cost, credit-related impairment, if any, will be recognized in an allowance for credit losses and adjusted each period for changes in expected credit risk. This model replaces the existing impairment models, which generally require that a loss be incurred before it is recognized. The CECL model represents a significant change from existing practice and may result in material changes to the Bank's accounting for financial instruments. The Bank is evaluating the effect ASU 2016-13 will have on its financial statements and related disclosures. The impact of the ASU will depend upon the state of the economy and the nature of our portfolios at the date of adoption. The new standard is effective for fiscal years beginning after December 15, 2022, or October 1, 2023 as to the Bank, including interim periods within those fiscal years. Management is continuing to evaluate the provisions of the ASU.

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

---

| | |
|:---|:---|
| **Note 3:** | **Debt Securities** |

---

The amortized cost and fair values, together with gross unrealized gains and losses of securities are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Amortized <br> Cost** | **Gross<br> Unrealized<br> Gains** | **Gross<br> Unrealized<br> Losses** | **Approximate Fair <br> Value** |
| **Available-for-sale Securities:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;**December 31, 2022** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;U.S. Treasury securities | $2005144 | $- | $76589 | $1928555 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;U.S. Government agencies | 4021871 |  | 221434 | 3800437 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Mortgage-backed Government Sponsored Enterprises (GSEs) | 4032954 |  | 360598 | 3672356 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;State and political subdivisions | 4226676 | 23329 | 330280 | 3919725 |
|  | $14286645 | $23329 | $988901 | $13321073 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Amortized <br> Cost** | **Gross <br> Unrealized<br> Gains** | **Gross<br> Unrealized<br> Losses** | **Approximate Fair <br> Value** |
| **Available-for-sale Securities:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;**September 30, 2022** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;U.S. Treasury securities | $2008695 | $- | $84242 | $1924453 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;U.S. Government agencies | 4025948 |  | 227874 | 3798074 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Mortgage-backed Government Sponsored Enterprises (GSEs) | 4191085 |  | 395205 | 3795880 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;State and political subdivisions | 3490216 | 201 | 436629 | 3053788 |
|  | $13715944 | $201 | $1143950 | $12572195 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Amortized <br> Cost** | **Gross<br> Unrealized<br> Gains** | **Gross<br> Unrealized<br> Losses** | **Approximate Fair <br> Value** |
| **September 30, 2021** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;U.S. Treasury securities | $2022776 | $- | $1604 | $2021172 |
| &nbsp;&nbsp;&nbsp;U.S. Government agencies | 2005130 |  | 10741 | 1994389 |
| &nbsp;&nbsp;&nbsp;Mortgage-backed Government Sponsored Enterprises (GSEs) | 3370537 | 27349 | 12975 | 3384911 |
| &nbsp;&nbsp;&nbsp;State and political subdivisions | 1128177 | 56741 | - | 1184918 |
|  | $8526620 | $84090 | $25320 | $8585390 |

---

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Amortized <br> Cost** | **Gross<br> Unrealized<br> Gains** | **Gross<br> Unrealized <br> Losses** | **Approximate Fair <br> Value** |
| **Held-to-maturity Securities:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;**December 31, 2022** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Mortgage-backed Government Sponsored Enterprises (GSEs) | $212348 | $- | $4487 | $207861 |
| &nbsp;&nbsp;&nbsp;**September 30, 2022** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Mortgage-backed Government Sponsored Enterprises (GSEs) | $233388 | $- | $5304 | $228084 |
| &nbsp;&nbsp;&nbsp;**September 30, 2021** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Mortgage-backed Government Sponsored Enterprises (GSEs) | $338736 | $10598 | $- | $349334 |

---

The amortized cost and fair value of available-for-sale securities at December 31, 2022 and September 30, 2022, by contractual maturity, are shown below. Expected maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties:

---

| | | |
|:---|:---|:---|
|  | **Amortized**<br>**Cost** | **Fair**<br>**Value** |
| **December 31, 2022** |  |  |
| &nbsp;&nbsp;&nbsp;Within one year | $2260161 | $2193679 |
| &nbsp;&nbsp;&nbsp;One to five years | 4461105 | 4203423 |
| &nbsp;&nbsp;&nbsp;Five to ten years |  |  |
| &nbsp;&nbsp;&nbsp;After ten years | 3532425 | 3251615 |
|  | 10253691 | 9648717 |
| &nbsp;&nbsp;&nbsp;Mortgage-backed GSEs | 4032954 | 3672356 |
| &nbsp;&nbsp;&nbsp;Totals | $14286645 | $13321073 |
| **September 30, 2022** |  |  |
| &nbsp;&nbsp;&nbsp;Within one year | $1264601 | $1234656 |
| &nbsp;&nbsp;&nbsp;One to five years | 5998258 | 5686873 |
| &nbsp;&nbsp;&nbsp;Five to ten years |  |  |
| &nbsp;&nbsp;&nbsp;After ten years | 2262000 | 1854786 |
|  | 9524859 | 8776315 |
| &nbsp;&nbsp;&nbsp;Mortgage-backed GSEs | 4191085 | 3795880 |
| &nbsp;&nbsp;&nbsp;Totals | $13715944 | $12572195 |

---

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

The carrying value of securities pledged as collateral, to secure public deposits and for other purposes, was approximately $460,000, $460,000 and $498,000 at December 31, 2022 (unaudited), September 30, 2022 and 2021, respectively.

Proceeds from sales of available for sale securities totaled $519,000 during the three months ended December 31, 2022, resulting in a gross realized loss of $8,049. There were no sales of securities during the three-month period ended December 31, 2021, and the fiscal years ended September 30, 2022 and 2021.

Certain investments in debt securities are reported in the financial statements at an amount less than their historical cost. Total fair value of these investments, comprised of 29 securities at December 31, 2022 (unaudited), and 30 and 7 securities at September 30, 2022 and 2021, respectively, was approximately $12,232,000, $12,569,000 and $5,483,000, which is approximately 90 percent, 98 percent and 61 percent, respectively, of the fair value of the Bank's total investment portfolio. These declines primarily resulted from changes in market interest rates.

Based on evaluation of available evidence, including recent changes in market interest rates and information obtained from regulatory filings, management believes the declines in fair value for these securities are temporary.

Should the impairment of any of these securities become other than temporary, the cost basis of the investment will be reduced and the resulting loss recognized in net income in the period the other-than-temporary impairment is identified.

The following tables show the Bank's investments' gross unrealized losses and fair value of the Bank's investments with unrealized losses that are not deemed to be other-than-temporarily impaired, aggregated by investment class and length of time that individual securities have been in a continuous unrealized loss position at December 31, 2022 (unaudited), September 30, 2022 and 2021:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **December 31, 2022** | **December 31, 2022** | **December 31, 2022** | **December 31, 2022** | **December 31, 2022** | **December 31, 2022** |
| | **Less than 12 Months** | **Less than 12 Months** | **12 Months or More** | **12 Months or More** | **Total** | **Total** |
| <br>**Description of Securities** | **Fair <br> Value** | **Unrealized<br> Losses** | **Fair <br> Value** | **Unrealized<br> Losses** | **Fair <br> Value** | **Unrealized<br> Losses** |
| **Available for sale** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;U.S. Treasury securities | $- | $- | $1928555 | $76589 | $1928555 | $76589 |
| &nbsp;&nbsp;&nbsp;U.S. Government agencies | 1923017 | 96025 | 1877420 | 125409 | 3800437 | 221434 |
| &nbsp;&nbsp;&nbsp;Mortgage-backed Government Sponsored Enterprises (GSEs) | 2085784 | 142213 | 1586572 | 218385 | 3672356 | 360598 |
| &nbsp;&nbsp;&nbsp;State and political subdivisions | 2623116 | 330280 | - | - | 2623116 | 330280 |
|  | 6631917 | 568518 | 5392547 | 420383 | 12024464 | 988901 |
| **Held to maturity** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Mortgage-backed Government Sponsored Enterprises (GSEs) | 207853 | 4487 | - | - | 207853 | 4487 |
| &nbsp;&nbsp;&nbsp;Total temporarily impaired securities | $6839770 | $573005 | $5392547 | $420383 | $12232317 | $993388 |

---

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **September 30, 2022** | **September 30, 2022** | **September 30, 2022** | **September 30, 2022** | **September 30, 2022** | **September 30, 2022** |
| | **Less than 12 Months** | **Less than 12 Months** | **12 Months or More** | **12 Months or More** | **Total** | **Total** |
| <br>**Description of Securities** | **Fair <br> Value** | **Unrealized<br> Losses** | **Fair <br> Value** | **Unrealized<br> Losses** | **Fair <br> Value** | **Unrealized<br> Losses** |
| **Available for sale** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;U.S. Treasury securities | $- | $- | $1924453 | $84242 | $1924453 | $84242 |
| &nbsp;&nbsp;&nbsp;U.S. Government agencies | 1924522 | 98137 | 1873552 | 129737 | 3798074 | 227874 |
| &nbsp;&nbsp;&nbsp;Mortgage-backed Government Sponsored Enterprises (GSEs) | 3110636 | 291370 | 685244 | 103835 | 3795880 | 395205 |
| &nbsp;&nbsp;&nbsp;State and political subdivisions | 2822544 | 436629 | - | - | 2822544 | 436629 |
|  | 7857702 | 826136 | 4483249 | 317814 | 12340951 | 1143950 |
| **Held to maturity** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Mortgage-backed Government Sponsored Enterprises (GSEs) | 228071 | 5304 | - | - | 228071 | 5304 |
| &nbsp;&nbsp;&nbsp;Total temporarily impaired securities | $8085773 | $831440 | $4483249 | $317814 | $12569022 | $1149254 |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **September 30, 2021** | **September 30, 2021** | **September 30, 2021** | **September 30, 2021** | **September 30, 2021** | **September 30, 2021** |
| | **Less than 12 Months** | **Less than 12 Months** | **12 Months or More** | **12 Months or More** | **Total** | **Total** |
| <br>**Description of Securities** | **Fair <br> Value** | **Unrealized<br> Losses** | **Fair <br> Value** | **Unrealized<br> Losses** | **Fair <br> Value** | **Unrealized<br> Losses** |
| **Available for sale** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;U.S. Treasury securities | $2021172 | $1604 | $- | $- | $2021172 | $1604 |
| &nbsp;&nbsp;&nbsp;U.S. Government agencies | 1994389 | 10741 |  |  | 1994389 | 10741 |
| &nbsp;&nbsp;&nbsp;Mortgage-backed Government Sponsored Enterprises (GSEs) | 1467827 | 12975 | - | - | 1467827 | 12975 |
| &nbsp;&nbsp;&nbsp;Total temporarily impaired securities | $5483388 | $25320 | $- | $- | $5483388 | $25320 |

---

*U.S. Government Treasuries and Agencies and State and Political Subdivisions*

Unrealized losses on these securities have not been recognized because the issuers' bonds are of high credit quality, values have only been impacted by changes in interest rates since the securities were purchased, and the Bank has the intent and ability to hold the securities for the foreseeable future. The fair value is expected to recover as the bonds approach the maturity date. Because the decline in market value was attributable to changes in interest rates, and not credit quality, and because the Bank typically does not intend to sell the investments and it is not more likely than not the Bank will be required to sell the investments before recovery of their amortized cost basis, which may be maturity, the Bank does not consider those investments to be other-than-temporarily impaired at December 31, 2022, (unaudited) and September 30, 2022 and 2021.

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

*Mortgage-backed GSEs*

The unrealized losses on the Bank's investment in residential mortgage-backed government sponsored enterprises were caused primarily by changes in interest rates. The Bank expects to recover the amortized cost basis over the term of the securities. Because the decline in market value is attributable to changes in interest rates, and not credit quality, and because the Bank typically does not intend to sell the investments and it is not more likely than not the Bank will be required to sell the investments before recovery of their amortized cost basis, which may be maturity, the Bank does not consider those investments to be other-than-temporarily impaired at December 31, 2022 (unaudited), September 30, 2022 and 2021.

---

| | |
|:---|:---|
| **Note 4:** | **Loans and Allowance for Loan Losses** |

---

Categories of loans were as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | | **September 30,** | **September 30,** |
|  | **December 31,**<br>**2022** | **2022** | **2021** |
|  | (In thousands) | (In thousands) | (In thousands) |
| Real estate loans: |  |  |  |
| &nbsp;&nbsp;&nbsp;Residential | $76582 | $78312 | $73808 |
| &nbsp;&nbsp;&nbsp;Multi-family | 1346 | 1356 | 1173 |
| &nbsp;&nbsp;&nbsp;Agricultural | 30987 | 28516 | 27290 |
| &nbsp;&nbsp;&nbsp;Commercial | 1780 | 1790 | 1792 |
| &nbsp;&nbsp;&nbsp;Construction and land | 4228 | 3610 | 3631 |
| &nbsp;&nbsp;&nbsp;Home equity line of credit (HELOC) | 4716 | 5175 | 4220 |
| Commercial and industrial | 1767 | 1833 | 2170 |
| Consumer | 868 | 926 | 921 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total loans | 122274 | 121518 | 115005 |
| &nbsp;&nbsp;&nbsp;Less: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Undisbursed loans in process | 3151 | 2530 | 1202 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net deferred loan fees | 332 | 334 | 334 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Allowance for loan losses | 961 | 984 | 958 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net loans | $117830 | $117670 | $112511 |

---

Mortgage loans serviced for others are not included in the accompanying balance sheets. The unpaid principal balances of these loans at December 31, 2022 (unaudited) and September 30, 2022 and 2021, were approximately $20,621,000, $21,123,000 and $22,069,000, respectively. At December 31, 2022 (unaudited), September 30, 2021 and 2021, the mortgage-servicing rights included in other assets on the balance sheet were approximately $137,000, $140,000 and $147,000, respectively.

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

The following tables present the activity in the allowance for loan losses based on portfolio segment for the three months ended December 31, 2022 and 2021 and the years ended September 30, 2022 and 2021.

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Three Months Ended December 31, 2022** | **Three Months Ended December 31, 2022** | **Three Months Ended December 31, 2022** | **Three Months Ended December 31, 2022** | **Three Months Ended December 31, 2022** |
|  | **Balance**<br>**October 1, 2022** | **Provision (credit)**<br>**for loan losses** |<br>**Charge-offs** |<br>**Recoveries** | **Balance**<br>**December 31, 2022** |
|  | (In thousands) | (In thousands) | (In thousands) | (In thousands) | (In thousands) |
| Real estate loans: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Residential | $624 | $59 | $(23) | $- | $660 |
| &nbsp;&nbsp;&nbsp;Multi-family | 11 | 1 |  |  | 12 |
| &nbsp;&nbsp;&nbsp;Agricultural | 199 | (45) |  |  | 154 |
| &nbsp;&nbsp;&nbsp;Commercial | 11 | (2) |  |  | 9 |
| &nbsp;&nbsp;&nbsp;Construction and land | 35 | 4 |  |  | 39 |
| &nbsp;&nbsp;&nbsp;Home equity line of credit (HELOC) | 69 | (22) |  |  | 47 |
| Commercial and industrial | 12 | (3) |  |  | 9 |
| Consumer | 23 | 8 | - | - | 31 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total loans | $984 | $- | $(23) | $- | $961 |

---

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| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Three Months Ended December 31, 2021** | **Three Months Ended December 31, 2021** | **Three Months Ended December 31, 2021** | **Three Months Ended December 31, 2021** | **Three Months Ended December 31, 2021** |
|  | **Balance**<br>**October 1, 2021** | **Provision (credit)**<br>**for loan losses** |<br>**Charge-offs** |<br>**Recoveries** | **Balance**<br>**December 31, 2021** |
|  | (In thousands) | (In thousands) | (In thousands) | (In thousands) | (In thousands) |
| Real estate loans: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Residential | $627 | $32 | $- | $- | $659 |
| &nbsp;&nbsp;&nbsp;Multi-family | 10 |  |  |  | 10 |
| &nbsp;&nbsp;&nbsp;Agricultural | 211 | 5 |  |  | 216 |
| &nbsp;&nbsp;&nbsp;Commercial | 12 |  |  |  | 12 |
| &nbsp;&nbsp;&nbsp;Construction and land | 32 | (20) |  |  | 12 |
| &nbsp;&nbsp;&nbsp;Home equity line of credit (HELOC) | 40 | (2) |  |  | 38 |
| Commercial and industrial | 12 | (1) |  |  | 11 |
| Consumer | 14 | 1 | - | - | 15 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total loans | $958 | $15 | $- | $- | $973 |

---

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Year Ended September 30, 2022** | **Year Ended September 30, 2022** | **Year Ended September 30, 2022** | **Year Ended September 30, 2022** | **Year Ended September 30, 2022** |
|  | **Balance**<br>**October 1, 2021** | **Provision (credit)**<br>**for loan losses** | <br>**Charge-offs** | <br>**Recoveries** | **Balance**<br>**September 30, 2022** |
|  | (In thousands) | (In thousands) | (In thousands) | (In thousands) | (In thousands) |
| Real estate loans: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Residential | $627 | $(3) | $- | $- | $624 |
| &nbsp;&nbsp;&nbsp;Multi-family | 10 | 1 |  |  | 11 |
| &nbsp;&nbsp;&nbsp;Agricultural | 211 | (12) |  |  | 199 |
| &nbsp;&nbsp;&nbsp;Commercial | 12 | (1) |  |  | 11 |
| &nbsp;&nbsp;&nbsp;Construction and land | 32 | 3 |  |  | 35 |
| &nbsp;&nbsp;&nbsp;Home equity line of credit (HELOC) | 40 | 29 |  |  | 69 |
| Commercial and industrial | 12 |  |  |  | 12 |
| Consumer | 14 | 8 | - | 1 | 23 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total loans | $958 | $25 | $- | $1 | $984 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Year Ended September 30, 2021** | **Year Ended September 30, 2021** | **Year Ended September 30, 2021** | **Year Ended September 30, 2021** | **Year Ended September 30, 2021** |
|  | **Balance**<br>**October 1, 2020** | **Provision (credit)**<br>**for loan losses** | <br>**Charge-offs** | <br>**Recoveries** | **Balance**<br>**September 30, 2021** |
|  | (In thousands) | (In thousands) | (In thousands) | (In thousands) | (In thousands) |
| Real estate loans: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Residential | $534 | $155 | $(62) | $- | $627 |
| &nbsp;&nbsp;&nbsp;Multi-family | 9 | 1 |  |  | 10 |
| &nbsp;&nbsp;&nbsp;Agricultural | 206 | 5 |  |  | 211 |
| &nbsp;&nbsp;&nbsp;Commercial | 25 | (13) |  |  | 12 |
| &nbsp;&nbsp;&nbsp;Construction and land | 11 | 21 |  |  | 32 |
| &nbsp;&nbsp;&nbsp;Home equity line of credit (HELOC) | 19 | 21 |  |  | 40 |
| Commercial and industrial | 10 | 2 |  |  | 12 |
| Consumer | 26 | (12) | - | - | 14 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total loans | $840 | $180 | $(62) | $- | $958 |

---

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

The following tables present the balance in the allowance for loan losses and the recorded investment in loans based on portfolio segment and impairment method as of December 31, 2022 and September 30, 2022 and 2021:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Allowance for loan losses** | **Allowance for loan losses** | **Loans** | **Loans** |
|  | **Ending balance, evaluated for impairment** | **Ending balance, evaluated for impairment** | **Ending balance, evaluated for impairment** | **Ending balance, evaluated for impairment** |
|  | **Individually** | **Collectively** | **Individually** | **Collectively** |
|  | (In thousands) | (In thousands) | (In thousands) | (In thousands) |
| **December 31, 2022** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Real estate loans: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Residential | $- | $660 | $- | $76582 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Multi-family |  | 12 |  | 1346 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Agricultural |  | 154 |  | 30987 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Commercial |  | 9 |  | 1780 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Construction and land |  | 39 |  | 4228 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Home equity line of credit (HELOC) |  | 47 |  | 4716 |
| &nbsp;&nbsp;&nbsp;Commercial and industrial |  | 9 |  | 1767 |
| &nbsp;&nbsp;&nbsp;Consumer | - | 31 | - | 868 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total loans | $- | $961 | $- | $122274 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Allowance for loan losses** | **Allowance for loan losses** | **Loans** | **Loans** |
|  | **Ending balance, evaluated for impairment** | **Ending balance, evaluated for impairment** | **Ending balance, evaluated for impairment** | **Ending balance, evaluated for impairment** |
|  | **Individually** | **Collectively** | **Individually** | **Collectively** |
|  | (In thousands) | (In thousands) | (In thousands) | (In thousands) |
| **September 30, 2022** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Real estate loans: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Residential | $- | $624 | $- | $78312 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Multi-family |  | 11 |  | 1356 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Agricultural |  | 199 |  | 28516 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Commercial |  | 11 |  | 1790 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Construction and land |  | 35 |  | 3610 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Home equity line of credit (HELOC) |  | 69 |  | 5175 |
| &nbsp;&nbsp;&nbsp;Commercial and industrial |  | 12 |  | 1833 |
| &nbsp;&nbsp;&nbsp;Consumer | - | 23 | - | 926 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total loans | $- | $984 | $- | $121518 |

---

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Allowance for loan losses** | **Allowance for loan losses** | **Loans** | **Loans** |
|  | **Ending balance, evaluated for impairment** | **Ending balance, evaluated for impairment** | **Ending balance, evaluated for impairment** | **Ending balance, evaluated for impairment** |
|  | **Individually** | **Collectively** | **Individually** | **Collectively** |
|  | (In thousands) | (In thousands) | (In thousands) | (In thousands) |
| **September 30, 2021** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Real estate loans: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Residential | $- | $627 | $- | $73808 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Multi-family |  | 10 |  | 1173 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Agricultural |  | 211 |  | 27290 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Commercial |  | 12 |  | 1792 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Construction and land |  | 32 |  | 3631 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Home equity line of credit (HELOC) |  | 40 |  | 4220 |
| &nbsp;&nbsp;&nbsp;Commercial and industrial |  | 12 |  | 2170 |
| &nbsp;&nbsp;&nbsp;Consumer | - | 14 | - | 921 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total loans | $- | $958 | $- | $115005 |

---

The Bank has adopted a standard loan grading system for all loans, as follows:

**Pass.** Loans of sufficient quality, which generally are protected by the current net worth and paying capacity of the obligor or by the value of the asset or underlying collateral.

**Special Mention.** Loans have potential weaknesses that deserve management's close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the asset or in the Bank's credit position at some future date.

**Substandard.** Loans which are inadequately protected by the current sound worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified must have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the Bank will sustain some loss if the deficiencies are not corrected. Usually, this classification includes all 90 days or more, non-accrual, and past due loans.

**Doubtful.** Loans which have all the weaknesses inherent in those classified substandard with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

**Loss** Loans considered uncollectible and of such little value that continuance as an asset without the establishment of a specific reserve is not warranted.

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

Risk characteristics of each loan portfolio segment are described as follows:

<u>Residential Real Estate</u>

These loans include first liens and junior liens on 1-4 family residential real estate (both owner and non-owner occupied). The main risks for these loans are changes in the value of the collateral and stability of the local economic environment and its impact on the borrowers' employment. Management specifically considers unemployment and changes in real estate values in the Bank's market area.

<u>Multi-family Real Estate</u>

These loans include loans on residential real estate secured by property with five or more units. The main risks are changes in the value of the collateral, ability of borrowers to collect rents, vacancy and changes in the tenants' employment status. Management specifically considers unemployment and changes in real estate values in the Bank's market area.

<u>Agriculture Real Estate</u>

These loans are primarily loans on farm ground and include loans secured by residential properties located on farm ground, but agricultural activities may not be the primary occupation of the borrowers. The main risks are changes in the value of the collateral and changes in the economy or borrowers' business operations. Management specifically considers unemployment and changes in real estate values in the Bank's market area.

<u>Commercial Real Estate</u>

These loans are generally secured by owner-occupied commercial real estate including warehouses and offices. The main risks are changes in the value of the collateral and ability of borrowers to successfully conduct their business operations. Management specifically considers unemployment and changes in real estate values in the Bank's market area.

<u>Construction and Land Real Estate</u>

These loans include construction loans for 1-4 family residential and commercial properties (both owner and non-owner occupied) and first liens on land. The main risks for construction loans include uncertainties in estimating costs of construction and in estimating the market value of the completed project. The main risks for land loans are changes in the value of the collateral and stability of the local economic environment. Management specifically considers unemployment and changes in real estate values in the Bank's market area.

<u>HELOC</u>

These loans are generally secured by owner-occupied 1-4 family residences. The main risks for these loans are changes in the value of the collateral and stability of the local economic environment and its impact on the borrowers' employment. Management specifically considers unemployment and changes in real estate values in the Bank's market area.

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

<u>Commercial and Industrial</u>

The commercial and industrial portfolio includes loans to commercial customers for use in financing working capital needs, equipment purchases and expansions. The loans in this category are repaid primarily from the cash flow of a borrower's principal business operation. Credit risk in these loans is driven by creditworthiness of the borrower and the economic conditions that impact the cash flow stability from business operations.

<u>Consumer Loans</u>

These loans include vehicle loans, share loans and unsecured loans. The main risks for these loans are the depreciation of the collateral values (vehicles) and the financial condition of the borrowers. Major employment changes are specifically considered by management.

Information regarding the credit quality indicators most closely monitored for other than residential real estate loans by class as of December 31, 2022, (unaudited), September 30, 2022 and 2021, follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Pass** | **Special Mention** | **Substandard** | **Doubtful** | **Total** |
|  | (In thousands) | (In thousands) | (In thousands) | (In thousands) | (In thousands) |
| **December 31, 2022** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Real estate loans: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Residential | $75933 | $- | $649 | $- | $76582 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Multi-family | 1346 |  |  |  | 1346 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Agricultural | 30987 |  |  |  | 30987 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Commercial | 1780 |  |  |  | 1780 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Construction and land | 4228 |  |  |  | 4228 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Home equity line of credit (HELOC) | 4572 |  | 144 |  | 4716 |
| &nbsp;&nbsp;&nbsp;Commercial and industrial | 1767 |  |  |  | 1767 |
| &nbsp;&nbsp;&nbsp;Consumer | 868 | - | - | - | 868 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total loans | $121481 | $- | $793 | $- | $122274 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Pass** | **Special Mention** | **Substandard** | **Doubtful** | **Total** |
|  | (In thousands) | (In thousands) | (In thousands) | (In thousands) | (In thousands) |
| **September 30, 2022** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Real estate loans: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Residential | $77965 | $- | $347 | $- | $78312 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Multi-family | 1356 |  |  |  | 1356 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Agricultural | 28516 |  |  |  | 28516 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Commercial | 1790 |  |  |  | 1790 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Construction and land | 3610 |  |  |  | 3610 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Home equity line of credit (HELOC) | 5175 |  |  |  | 5175 |
| &nbsp;&nbsp;&nbsp;Commercial and industrial | 1833 |  |  |  | 1833 |
| &nbsp;&nbsp;&nbsp;Consumer | 923 | - | 3 | - | 926 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total loans | $121168 | $- | $350 | $- | $121518 |

---

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | **Pass** | **Special Mention** | **Substandard** | **Doubtful** | **Total** |
|  | (In thousands) | (In thousands) | (In thousands) | (In thousands) | (In thousands) |
| **September 30, 2021** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Real estate loans: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Residential | $73642 | $- | $166 | $- | $73808 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Multi-family | 1173 |  |  |  | 1173 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Agricultural | 27290 |  |  |  | 27290 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Commercial | 1792 |  |  |  | 1792 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Construction and land | 3631 |  |  |  | 3631 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Home equity line of credit (HELOC) | 4192 |  | 28 |  | 4220 |
| &nbsp;&nbsp;&nbsp;Commercial and industrial | 2170 |  |  |  | 2170 |
| &nbsp;&nbsp;&nbsp;Consumer | 902 | - | 19 | - | 921 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total loans | $114792 | $- | $213 | $- | $115005 |

---

The Bank evaluates the loan risk grading system definitions and allowance for loan losses methodology on an ongoing basis. No significant changes were made to either during the three months ended December 31, 2022, (unaudited) or the years ended September 30, 2022 and 2021.

The following tables present the Bank's loan portfolio aging analysis of the recorded investment in loans as of December 31, 2022, September 30, 2022 and 2021:

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **December 31, 2022** | **December 31, 2022** | **December 31, 2022** | **December 31, 2022** | **December 31, 2022** | **December 31, 2022** | **December 31, 2022** |
|  |<br>**30-59 Days**<br>**Past Due** |<br>**60-89 Days**<br>**Past Due** | **Greater Than**<br>**90 Days**<br>**Past Due** |<br>**Total**<br>**Past Due** |<br>**Current** |<br>**Total Loans**<br>**Receivable** | **Total Loans >**<br>**90 Days &**<br>**Accruing** |
|  | (In thousands) | (In thousands) | (In thousands) | (In thousands) | (In thousands) | (In thousands) | (In thousands) |
| Real estate loans: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Residential | $534 | $413 | $288 | $1235 | $75347 | $76582 | $- |
| &nbsp;&nbsp;&nbsp;Multi-family |  |  |  |  | 1346 | 1346 |  |
| &nbsp;&nbsp;&nbsp;Agricultural |  |  |  |  | 30987 | 30987 |  |
| &nbsp;&nbsp;&nbsp;Commercial |  |  |  |  | 1780 | 1780 |  |
| &nbsp;&nbsp;&nbsp;Construction and land |  |  |  |  | 4228 | 4228 |  |
| &nbsp;&nbsp;&nbsp;Home equity line of credit (HELOC) |  |  | 144 | 144 | 4572 | 4716 |  |
| Commercial and industrial |  |  |  |  | 1767 | 1767 |  |
| Consumer | - | - | - | - | 868 | 868 | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total** | $534 | $413 | $432 | $1379 | $120895 | $122274 | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;- |

---

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **September 30, 2022** | **September 30, 2022** | **September 30, 2022** | **September 30, 2022** | **September 30, 2022** | **September 30, 2022** | **September 30, 2022** |
|  |<br>**30-59 Days**<br>**Past Due** |<br>**60-89 Days**<br>**Past Due** | **Greater Than**<br>**90 Days**<br>**Past Due** |<br>**Total**<br>**Past Due** |<br>**Current** |<br>**Total Loans**<br>**Receivable** | **Total Loans >**<br>**90 Days &**<br>**Accruing** |
|  | (In thousands) | (In thousands) | (In thousands) | (In thousands) | (In thousands) | (In thousands) | (In thousands) |
| Real estate loans: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Residential | $271 | $65 | $347 | $683 | $77629 | $78312 | $- |
| &nbsp;&nbsp;&nbsp;Multi-family |  |  |  |  | 1356 | 1356 |  |
| &nbsp;&nbsp;&nbsp;Agricultural |  |  |  |  | 28516 | 28516 |  |
| &nbsp;&nbsp;&nbsp;Commercial |  |  |  |  | 1790 | 1790 |  |
| &nbsp;&nbsp;&nbsp;Construction and land |  |  |  |  | 3610 | 3610 |  |
| &nbsp;&nbsp;&nbsp;Home equity line of credit (HELOC) | 144 |  |  | 144 | 5031 | 5175 |  |
| Commercial and industrial |  |  |  |  | 1833 | 1833 |  |
| Consumer | - | - | 3 | 3 | 923 | 926 | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total** | $415 | $65 | $350 | $830 | $120688 | $121518 | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;- |

---

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **September 30, 2021** | **September 30, 2021** | **September 30, 2021** | **September 30, 2021** | **September 30, 2021** | **September 30, 2021** | **September 30, 2021** |
|  |<br>**30-59 Days**<br>**Past Due** |<br>**60-89 Days**<br>**Past Due** | **Greater Than**<br>**90 Days**<br>**Past Due** |<br>**Total**<br>**Past Due** |<br>**Current** |<br>**Total Loans**<br>**Receivable** | **Total Loans >**<br>**90 Days &**<br>**Accruing** |
|  | (In thousands) | (In thousands) | (In thousands) | (In thousands) | (In thousands) | (In thousands) | (In thousands) |
| Real estate loans: |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Residential | $543 | $45 | $166 | $754 | $73054 | $73808 | $- |
| &nbsp;&nbsp;&nbsp;Multi-family |  |  |  |  | 1173 | 1173 |  |
| &nbsp;&nbsp;&nbsp;Agricultural |  |  |  |  | 27290 | 27290 |  |
| &nbsp;&nbsp;&nbsp;Commercial |  |  |  |  | 1792 | 1792 |  |
| &nbsp;&nbsp;&nbsp;Construction and land |  |  |  |  | 3631 | 3631 |  |
| &nbsp;&nbsp;&nbsp;Home equity line of credit (HELOC) |  |  |  |  | 4220 | 4220 |  |
| Commercial and industrial | 20 |  | 28 | 48 | 2122 | 2170 |  |
| Consumer | - | - | 19 | 19 | 902 | 921 | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total** | $563 | $45 | $213 | $821 | $114184 | $115005 | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;- |

---

The Bank had no loans identified as impaired as of December 31, 2022, September 30, 2022 and 2021, and no loans identified as impaired during the three months ended December 31, 2022 and 2021, and during the years ended September 30, 2022 and 2021.

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

Nonaccrual loans at December, 31, 2022, September 30, 2022 and 2021, were as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | | **September 30,** | **September 30,** |
|  | **December 31,**<br>**2022** | **2022** | **2021** |
|  | (In thousands) | (In thousands) | (In thousands) |
| Residential real estate loans | $288 | $347 | $166 |
| Home equity line of credit | 144 |  | 28 |
| Consumer | - | 3 | 19 |
|  | $432 | $350 | $213 |

---

There were no loans modified in a troubled debt restructuring during the three months ended December 31, 2022 (unaudited) and during the years ending September 30, 2022 and 2021. There were no troubled debt restructurings modified in the past 12 months that subsequently defaulted during the three months ended December 31, 2021 (unaudited) and for the years ended September 30, 2022 and 2021.

---

| | |
|:---|:---|
| **Note 5:** | **Premises and Equipment** |

---

Major classifications of premises and equipment, stated at cost, at December 31, 2022, September 30, 2022 and 2021, are as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | | **September 30,** | **September 30,** |
|  | **December 31,**<br>**2022** | **2022** | **2021** |
| Land | $483570 | $483570 | $483570 |
| Buildings and improvements | 4251686 | 4247815 | 4247815 |
| Furniture and equipment | 1596088 | 1534124 | 1154919 |
| Construction in progress | - | - | 2969 |
|  | 6331344 | 6265509 | 5889273 |
| Less accumulated depreciation | 3728557 | 3657218 | 3473428 |
| &nbsp;&nbsp;&nbsp;Net premises and equipment | $2602787 | $2608291 | $2415845 |

---

Depreciation expense was approximately $71,000 and $49,000 (unaudited), for the three months ended December 31, 2022 and 2021, respectively, and $190,000 and $207,000 for the years ended September 30, 2022 and 2021, respectively.

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

---

| | |
|:---|:---|
| **Note 6:** | **Time Deposits** |

---

Time deposits in denominations of $250,000 or more were $1,394,000, $2,195,000 and $2,464,000 at December 31, 2022 (unaudited), September 30, 2022 and 2021, respectively.

At December 31, 2022 and September 30, 2022, the scheduled maturities of time deposits were as follows:

---

| | | |
|:---|:---|:---|
|  | **December 31,**<br>**2022** | **September 30,**<br>**2022** |
| Within one year | $14479156 | $13738887 |
| One year to two years | 4916133 | 6550386 |
| Two years to three years | 2470999 | 2878318 |
| Three years to four years | 734871 | 1490070 |
| Four years to five years | 488279 | 608570 |
|  | $23089438 | $25266231 |

---

---

| | |
|:---|:---|
| **Note 7:** | **Borrowings** |

---

The Bank had Federal Home Loan Bank (FHLB) advances outstanding totaling $3,000,000, $3,000,000 and $4,000,000 as of December 31, 2022, (unaudited) September 30, 2022 and 2021, respectively.

The Bank has made a collateral pledge to the FHLB consisting of all shares of FHLB stock owned by the Bank and a blanket pledge of approximately $77,511,000 (unaudited), and $75,914,000 of its qualifying mortgage assets as of December 31, 2022 and September 30, 2022, respectively.

Based on this collateral, the Bank was eligible to borrow up to a total of approximately $53,860,000 (unaudited) and $52,689,000 as of December 31, 2022 and September 30, 2022, respectively.

Maturities of FHLB advances were as follows at December 31, 2022 (unaudited) and September 30, 2022:

---

| | | |
|:---|:---|:---|
|  | **December 31,**<br>**2022** | **September 30,**<br>**2022** |
| Within one year | $1000000 | $1000000 |
| One year to two years | 1000000 | 1000000 |
| Two years to three years | 1000000 | 1000000 |
|  | $3000000 | $3000000 |

---

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

At December 31, 2022, September 30 2022 and 2021, the Bank had a cash management line of credit agreement with the FHLB providing for additional borrowing of $10 million. The Bank had no outstanding borrowings on this line at December 31, 2022, September 30 2022 and 2021.

---

| | |
|:---|:---|
| **Note 8:** | **Income Taxes** |

---

The provision for income taxes includes these components:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended** | **For the Three Months Ended** | **For the Year Ended** | **For the Year Ended** |
|  | **December 31,** | **December 31,** | **September 30,** | **September 30,** |
|  | **2022** | **2021** | **2022** | **2021** |
| Taxes currently payable | $72284 | $51448 | $195067 | $213645 |
| Deferred income taxes | 4116 | (1148) | (2013) | (70900) |
| &nbsp;&nbsp;&nbsp;Income tax expense | $76400 | $50300 | $193054 | $142745 |

---

A reconciliation of the federal income tax expense at the statutory rate to the Bank's actual income tax expense is shown below:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended** | **For the Three Months Ended** | **For the Year Ended** | **For the Year Ended** |
|  | **December 31,** | **December 31,** | **September 30,** | **September 30,** |
|  | **2022** | **2021** | **2022** | **2021** |
| Computed at statutory rate (21%) | $85046 | $48222 | $238695 | $149941 |
| Increase (decrease) resulting from: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Bank-owned life insurance | (3020) | (2376) | (11156) | (9421) |
| &nbsp;&nbsp;&nbsp;Nontaxable interest income on municipal securities | (5191) | (1919) | (11130) | (4583) |
| &nbsp;&nbsp;&nbsp;Nontaxable life insurance death benefit | (948) |  | (35504) |  |
| &nbsp;&nbsp;&nbsp;Other | 513 | 6373 | 12150 | 6808 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Actual income tax expense | $76400 | $50300 | $193054 | $142745 |

---

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

The composition of the Bank's net deferred tax assets and liabilities at December 31, 2022 (unaudited), September 30, 2022 and 2021, is as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | | **September 30,** | **September 30,** |
|  | **December 31,**<br>**2022** | **2022** | **2021** |
| Deferred tax assets |  |  |  |
| &nbsp;&nbsp;&nbsp;Allowance for loan losses | $208702 | $213650 | $208036 |
| &nbsp;&nbsp;&nbsp;Accrued benefits | 121825 | 122757 | 121253 |
| &nbsp;&nbsp;&nbsp;Unrealized losses on available-for-sale securities | 202770 | 240187 |  |
| &nbsp;&nbsp;&nbsp;Other | 51007 | 52094 | 58832 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred tax assets | 584304 | 628688 | 388121 |
| Deferred tax liabilities |  |  |  |
| &nbsp;&nbsp;&nbsp;Depreciation | (61746) | (62832) | (67176) |
| &nbsp;&nbsp;&nbsp;Federal Home Loan Bank stock dividends | (244098) | (244098) | (244098) |
| &nbsp;&nbsp;&nbsp;Mortgage servicing rights | (29724) | (30402) | (32035) |
| &nbsp;&nbsp;&nbsp;Unrealized gains on available-for-sale securities |  |  | (12342) |
| &nbsp;&nbsp;&nbsp;Other | (18218) | (19305) | (14961) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred tax liabilities | (353786) | (356637) | (370612) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net deferred tax asset | $230518 | $272051 | $17509 |

---

Retained earnings at each of December 31, 2022 (unaudited), September 30, 2022 and 2021, includes approximately $909,000 for which no deferred federal income tax liability has been recognized. This amount represents an allocation of income to bad debt deductions for tax purposes only. Reduction of amounts so allocated for purposes other than tax bad debt losses or adjustments arising from carryback of net operating losses would create income for tax purposes only, which would be subject to the then-current corporate income tax rate. The deferred income tax liability on the preceding amount that would have been recorded if it was expected to reverse into taxable income in the foreseeable future was approximately $191,000 at December 31, 2022 (unaudited), September 30, 2022 and 2021.

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

---

| | |
|:---|:---|
| **Note 9:** | **Regulatory Matters** |

---

The Bank is subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Bank's financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines that involve quantitative measures of the Bank's assets, liabilities and certain off-balance-sheet items as calculated under U.S. GAAP reporting requirements and regulatory capital standards. The Bank's capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings and other factors. Furthermore, the Bank's regulators could require adjustments to regulatory capital not reflected in these financial statements.

Quantitative measures established by regulatory reporting standards to ensure capital adequacy require the Bank to maintain minimum amounts and ratios (set forth in the table below) of total and Tier I capital (as defined) to risk-weighted assets (as defined), common equity Tier I capital (as defined) to total risk-weighted assets (as defined) and of Tier I capital (as defined) to average assets (as defined). Management believes, as of December 31, 2022, September 30, 2022 and 2021, that the Bank met all capital adequacy requirements to which it is subject.

As of December 31, 2022, the most recent notification from the regulators categorized the Bank as well capitalized under the regulatory framework for prompt corrective action. To be categorized as well capitalized, the Bank must maintain minimum total risk-based capital, Tier I risk-based capital, common equity Tier I risk-based capital and Tier I leverage ratios as set forth in the table.

There are no conditions or events since that notification that management believes have changed the Bank's category.

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

The Bank's actual and required capital amounts and ratios are as follows (table amounts in thousands):

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Actual** | **Actual** | **For Capital Adequacy<br> Purposes** | **For Capital Adequacy<br> Purposes** | **To Be Well Capitalized Under<br> Prompt Corrective Action<br> Provisions** | **To Be Well Capitalized Under<br> Prompt Corrective Action<br> Provisions** |
|  | **Amount** | **Ratio** | **Amount** | **Ratio** | **Amount** | **Ratio** |
|  | (Dollars in thousands) | (Dollars in thousands) | (Dollars in thousands) | (Dollars in thousands) | (Dollars in thousands) | (Dollars in thousands) |
| **As of December 31, 2022** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Total Capital |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;(to Risk-Weighted Assets) | $16142 | 16.8% | $7673 | 8.0% | $9591 | 10.0% |
| &nbsp;&nbsp;&nbsp;Tier 1 Capital |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;(to Risk-Weighted Assets) | $15181 | 15.8% | $5755 | 6.0% | $7673 | 8.0% |
| &nbsp;&nbsp;&nbsp;Common Equity Tier I Capital |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;(to Risk-Weighted Assets) | $15181 | 15.8% | $4316 | 4.5% | $6234 | 6.5% |
| &nbsp;&nbsp;&nbsp;Tier I Capital |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;(to Average Total Assets) | $15181 | 10.2% | $5979 | 4.0% | $7473 | 5.0% |
| **As of September 30, 2022** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Total Capital |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;(to Risk-Weighted Assets) | $15800 | 16.6% | $7613 | 8.0% | $9516 | 10.0% |
| &nbsp;&nbsp;&nbsp;Tier 1 Capital |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;(to Risk-Weighted Assets) | $14816 | 15.6% | $5710 | 6.0% | $7613 | 8.0% |
| &nbsp;&nbsp;&nbsp;Common Equity Tier I Capital |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;(to Risk-Weighted Assets) | $14816 | 15.6% | $4282 | 4.5% | $6185 | 6.5% |
| &nbsp;&nbsp;&nbsp;Tier I Capital |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;(to Average Total Assets) | $14816 | 9.7% | $6106 | 4.0% | $7632 | 5.0% |
| **As of September 30, 2021** |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Total Capital |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;(to Risk-Weighted Assets) | $14974 | 16.4% | $7324 | 8.0% | $9155 | 10.0% |
| &nbsp;&nbsp;&nbsp;Tier 1 Capital |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;(to Risk-Weighted Assets) | $14016 | 15.3% | $5493 | 6.0% | $7324 | 8.0% |
| &nbsp;&nbsp;&nbsp;Common Equity Tier I Capital |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;(to Risk-Weighted Assets) | $14016 | 15.3% | $4120 | 4.5% | $5951 | 6.5% |
| &nbsp;&nbsp;&nbsp;Tier I Capital |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;(to Average Total Assets) | $14016 | 9.3% | $6009 | 4.0% | $7511 | 5.0% |

---

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

---

| | |
|:---|:---|
| **Note 10:** | **Related Party Transactions** |

---

The Bank had loans outstanding to certain of its executive officers, directors and their related interests. Activity in these loans for the three months ended December 31, 2022, (unaudited) and for the years ended September 30, 2022 and 2021, is presented in the following table. Loan balances that are no longer considered part of a related party relationship are shown as other activity.

---

| | | | |
|:---|:---|:---|:---|
|  | | **For the Year Ended** | **For the Year Ended** |
|  | | **September 30,** | **September 30,** |
|  | **For the Three**<br>**Months Ended**<br>**December 31, 2022** | **2022** | **2021** |
| Balance at beginning of period | $1111400 | $1160700 | $748600 |
| New borrowings |  | 464800 | 546300 |
| Repayments | (15900) | (238100) | (134200) |
| Other | - | (276000) | - |
| Balance at end of period | $1095500 | $1111400 | $1160700 |

---

In management's opinion, such loans and other extensions of credit and deposits were made in the ordinary course of business and were made on substantially the same terms (including interest rates and collateral) as those prevailing at the time for comparable transactions with other persons. Further, in management's opinion, these loans did not involve more than normal risk of collectability or present other unfavorable features.

Deposits from related parties held by the Bank at December 31, 2022 (unaudited), September 30, 2022 and 2021 totaled approximately $833,000, $640,000 and $1,084,000, respectively.

---

| | |
|:---|:---|
| **Note 11:** | **Employee Benefits** |

---

<u>401(k) Plan</u>

The Bank has a defined contribution 401(k) and profit sharing benefit plan covering substantially all employees. Employees are eligible to participate once they have reached age 21 and have completed one year of service. The Bank will make matching contributions up to 4 percent of an employee's compensation once the employee has completed 12 months of service. The Bank may make a discretionary profit sharing contribution to the plan each year. The Bank's expense for this plan totaled approximately $58,000 and $50,000 for the three months ended December 31, 2022 and 2021, respectively (unaudited), and $167,000 and $130,000 for the years ended September 30, 2022 and 2021, respectively.

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

<u>Director Retirement Plan</u>

The Bank maintains a plan to provide specified retirement benefits to each director upon their retirement from the Board. The director retirement plan expense for the three months ended December 31, 2022 and 2021 (unaudited) was $11,000 and $12,000, respectively, and for the years ended September 31, 2022 and 2021, was $72,000 and $50,000, respectively. The related accrued liability as of December 31, 2022 (unaudited) and September 30, 2022 and 2021 was $561,000, $565,000 and $555,000, respectively. The Bank purchased Flexible Premium Universal Life Insurance Policies to use as an informal funding vehicle for the expected future payments. The cash surrender value of these policies is reflected on the Bank's balance sheets.

---

| | |
|:---|:---|
| **Note 12:** | **Disclosures about Fair Value of Assets and Liabilities** |

---

Fair value is the exchange price that would be received to sell an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. Fair value measurements must maximize the use of observable inputs and minimize the use of unobservable inputs. There is a hierarchy of three levels of inputs that may be used to measure fair value:

---

| | |
|:---|:---|
| **Level 1** | Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date. |

---

---

| | |
|:---|:---|
| **Level 2** | Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data. |

---

---

| | |
|:---|:---|
| **Level 3** | Significant unobservable inputs that reflect an entity's own assumptions about the assumptions that market participants would use in pricing an asset or liability. |

---

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

***Recurring Measurements***

The following table presents the fair value measurements of assets recognized in the accompanying balance sheets measured at fair value on a recurring basis and the level within the fair value hierarchy in which the fair value measurements fall at December 31, 2022 (unaudited), September 30, 2022 and 2021:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | | **Fair Value Measurements Using** | **Fair Value Measurements Using** | **Fair Value Measurements Using** |
|  |<br>**Fair <br> Value** | **Quoted Prices in<br> Active Markets for<br> Identical Assets <br> (Level 1)** | **Significant Other<br> Observable Inputs<br> (Level 2)** | **Significant<br> Unobservable<br> Inputs <br> (Level 3)** |
| **December 31, 2022** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;U.S. Treasury securities | $1928555 | $1928555 | $- | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;- |
| &nbsp;&nbsp;&nbsp;U.S. Government agencies | 3800437 |  | 3800437 |  |
| &nbsp;&nbsp;&nbsp;Mortgage-backed Government Sponsored Enterprises (GSEs) | 3672356 |  | 3672356 |  |
| &nbsp;&nbsp;&nbsp;State and political subdivisions | 3919725 |  | 3919725 |  |
| **September 30, 2022** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;U.S. Treasury securities | $1924453 | $1924453 | $- | $- |
| &nbsp;&nbsp;&nbsp;U.S. Government agencies | 3798074 |  | 3798074 |  |
| &nbsp;&nbsp;&nbsp;Mortgage-backed Government Sponsored Enterprises (GSEs) | 3795880 |  | 3795880 |  |
| &nbsp;&nbsp;&nbsp;State and political subdivisions | 3053788 |  | 3053788 |  |
| **September 30, 2021** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;U.S. Treasury securities | $2021172 | $2021172 | $- | $- |
| &nbsp;&nbsp;&nbsp;U.S. Government agencies | 1994389 |  | 1994389 |  |
| &nbsp;&nbsp;&nbsp;Mortgage-backed Government Sponsored Enterprises (GSEs) | 3384911 |  | 3384911 |  |
| &nbsp;&nbsp;&nbsp;State and political subdivisions | 1184918 |  | 1184918 |  |

---

Following is a description of the valuation methodologies used for assets measured at fair value on a recurring basis and recognized in the accompanying balance sheets, as well as the general classification of such assets pursuant to the valuation hierarchy. There are no liabilities measured at fair value on a recurring basis. There have been no significant changes in the valuation techniques during the three months ended December 31, 2022 (unaudited) and the years ended September 30, 2022 and 2021.

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

***Available-for-sale Securities***

Where quoted market prices are available in an active market, securities are classified within Level 1 of the valuation hierarchy. If quoted market prices are not available, then fair values are estimated by using quoted prices of securities with similar characteristics or independent asset pricing services and pricing models, the inputs of which are market-based or independently sourced market parameters, including, but not limited to, yield curves, interest rates, volatilities, prepayments, defaults, cumulative loss projections and cash flows. Such securities are classified in Level 2 of the valuation hierarchy. In certain cases where Level 1 or Level 2 are not available, securities are classified within Level 3 of the hierarchy. The Bank had no Level 3 securities.

***Nonrecurring Measurements***

The Bank had no assets or liabilities measured at fair value on a nonrecurring basis at December 31, 2022 (unaudited) and September 30, 2022 and 2021.

The estimated fair values of the Bank's financial instruments not carried at fair value on the balance sheets are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | | | **Fair Value Measurements Using** | **Fair Value Measurements Using** | **Fair Value Measurements Using** |
|  | **Carrying**<br>**Value** | **Fair**<br>**Value** | **Level 1** | **Level 2** | **Level 3** |
| **December 31, 2022** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;**Financial assets:** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash and cash equivalents | $7202761 | $7202761 | $7202761 | $- | $- |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest-bearing time deposits | 100000 | 100000 | 100000 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loans, net | 117830170 | 108738000 |  |  | 108738000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;FHLB Stock | 1390200 | 1390200 |  | 1390200 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Bank owned life insurance | 1752562 | 1752562 | 1752562 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued interest receivable | 368976 | 368976 | 368976 |  |  |
| &nbsp;&nbsp;&nbsp;**Financial liabilities:** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deposits | 127698848 | 127775410 | 104609410 |  | 23166000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;FHLB advances | 3000000 | 3003000 |  | 3003000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued interest payable | 2702 | 2702 | 2702 |  |  |

---

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | | | **Fair Value Measurements Using** | **Fair Value Measurements Using** | **Fair Value Measurements Using** |
|  | **Carrying**<br>**Value** | **Fair**<br>**Value** | **Level 1** | **Level 2** | **Level 3** |
| **September 30, 2022** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;**Financial assets:** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash and cash equivalents | $14376718 | $14376718 | $14376718 | $- | $- |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest-bearing time deposits | 100000 | 100000 | 100000 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loans, net | 117670600 | 106895000 |  |  | 106895000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;FHLB Stock | 1390200 | 1390200 |  | 1390200 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Bank owned life insurance | 1742464 | 1742464 | 1742464 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued interest receivable | 376903 | 376903 | 376903 |  |  |
| &nbsp;&nbsp;&nbsp;**Financial liabilities:** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deposits | 134758643 | 134834412 | 109492412 |  | 25342000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;FHLB advances | 3000000 | 3003000 |  | 3003000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued interest payable | 2778 | 2778 | 2778 |  |  |
| **September 30, 2021** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;**Financial assets:** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash and cash equivalents | $18000590 | $18000590 | $18000590 | $- | $- |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest-bearing time deposits | 100000 | 100000 | 100000 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loans, net | 112511079 | 111461000 |  |  | 111461000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;FHLB Stock | 1605300 | 1605300 |  | 1605300 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Bank owned life insurance | 2066444 | 2066444 | 2066444 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued interest receivable | 319688 | 319688 | 319688 |  |  |
| &nbsp;&nbsp;&nbsp;**Financial liabilities:** |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deposits | 128245290 | 128377136 | 97653136 |  | 30724000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;FHLB advances | 4000000 | 4026000 |  | 4026000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued interest payable | 3828 | 3828 | 3828 |  |  |

---

*Limitations:* Fair value estimates are made at a specific point in time, based on relevant market information and information about the financial instrument. These estimates do not reflect any premium or discount that could result from offering for sale at one time the Bank's entire holdings of a particular financial instrument. Fair value estimates may not be realizable in an immediate settlement of the instrument. In some instances, there are no quoted market prices for the Bank's various financial instruments, in which case fair values may be based on estimates using present value or other valuation techniques, or based on judgments regarding future expected loss experience, current economic conditions, risk characteristic of the financial instruments, or other factors. Those techniques are significantly affected by the assumptions used, including the discount rate and estimate of future cash flows. Subsequent changes in assumptions could significantly affect the estimates.

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

---

| | |
|:---|:---|
| **Note 13:** | **Commitments and Credit Risks** |

---

Commitments to originate loans are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since a portion of the commitments may expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. Each customer's creditworthiness is evaluated on a case-by-case basis. The amount of collateral obtained, if deemed necessary, is based on management's credit evaluation of the counterparty. Collateral held varies, but may include accounts receivable, inventory, property, plant and equipment, commercial real estate and residential real estate.

Lines of credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Lines of credit generally have fixed expiration dates. Since a portion of the line may expire without being drawn upon, the total unused lines do not necessarily represent future cash requirements. Each customer's creditworthiness is evaluated on a case-by-case basis. The amount of collateral obtained, if deemed necessary, is based on management's credit evaluation of the counterparty. Collateral held varies but may include accounts receivable, inventory, property, plant and equipment, commercial real estate and residential real estate.

Management uses the same credit policies in granting lines of credit as it does for on-balance-sheet instruments.

Commitments outstanding were as follows:

---

| | | | |
|:---|:---|:---|:---|
|  | | **September 30,** | **September 30,** |
|  | **December 31,**<br>**2022** | **2022** | **2021** |
|  | (In thousands) | (In thousands) | (In thousands) |
| Commitments to originate loans | $3027 | $3796 | $4464 |
| Undisbursed balance of loans closed | 10081 | 8975 | 9095 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total | $13108 | $12771 | $13559 |

---

---

| | |
|:---|:---|
| **Note 14:** | **Risks and Uncertainties** |

---

As a result of the spread of the COVID-19 coronavirus, economic uncertainties have arisen which may negatively affect the financial position, results of operations and cash flows of the Bank and in particular the collectability of the loan portfolio. The duration of these uncertainties and the ultimate financial effects cannot fully be reasonably estimated at this time.

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

---

| | |
|:---|:---|
| **Note 15:** | **Accumulated Other Comprehensive Income (Loss)** |

---

The components of accumulated other comprehensive income (loss), included in equity, are as follows at December 31, 2022 (unaudited), September 30, 2022 and 2021:

---

| | |
|:---|:---|
|  | Unrealized Gains<br>and Losses on<br>Available-for-<br>Sale Securities |
| Accumulated other comprehensive loss at October 1, 2022 | $(903562) |
| &nbsp;&nbsp;&nbsp;Other comprehensive income | 134401 |
| &nbsp;&nbsp;&nbsp;Reclassification adjustment for realized loss on sale of securities | 6359 |
| Accumulated other comprehensive loss at December 31, 2022 | $(762802) |
| Accumulated other comprehensive income at October 1, 2021 | $46428 |
| &nbsp;&nbsp;&nbsp;Other comprehensive loss | (53141) |
| Accumulated other comprehensive loss at December 31, 2021 | $(6713) |
| Accumulated other comprehensive income at October 1, 2021 | $46428 |
| &nbsp;&nbsp;&nbsp;Other comprehensive loss | (949990) |
| Accumulated other comprehensive loss at September 30, 2022 | $(903562) |
| Accumulated other comprehensive income at October 1, 2020 | $82130 |
| &nbsp;&nbsp;&nbsp;Other comprehensive loss | (35702) |
| Accumulated other comprehensive income at September 30, 2021 | $46428 |

---

**Mercer Savings Bank**

**Notes to Financial Statements**

**December 31, 2022 and 2021 (Unaudited) and September 30, 2022 and 2021**

---

| | |
|:---|:---|
| **Note 16:** | **Subsequent Events** |

---

*Plan of Conversion and Change in Corporate Form*

On March 3, 2023, the Board of Directors of the Bank adopted a plan of conversion (Plan). The Plan is subject to the approval of the Federal Deposit Insurance Corporation and the State of Ohio Division of Financial Institutions and must be approved by the affirmative vote of at least two-thirds of the total votes eligible to be cast by the voting members of the Bank at a special meeting. The Plan sets forth that the Bank proposes to convert into a stock savings bank structure with the establishment of a stock holding company (Mercer Bancorp, Inc.), as parent of the Bank. The Bank will convert to the stock form of ownership, followed by the issuance of all of the Bank's outstanding stock to Mercer Bancorp, Inc. Pursuant to the Plan, the Bank will determine the total offering value and number of shares of common stock based upon an independent appraiser's valuation. The stock will be priced at $10.00 per share. In addition, the Bank's Board of Directors will adopt an employee stock ownership plan (ESOP) which will subscribe for up to 8% of the common stock sold in the offering.

Mercer Bancorp, Inc. is organized as a corporation under the laws of the State of Maryland and will own all of the outstanding common stock of the Bank upon completion of the conversion.

The costs of issuing the common stock will be deferred and deducted from the sales proceeds of the offering. If the conversion is unsuccessful, all deferred costs will be charged to operations. The Bank had incurred no deferred conversion costs as of December 31, 2022 (unaudited) and September 30, 2022.

At the completion of the conversion to stock form, the Bank will establish a liquidation account in the amount of retained earnings contained in the final prospectus. The liquidation account will be maintained for the benefit of eligible savings account holders who maintain deposit accounts in the Bank after conversion.

The conversion will be accounted for as a change in corporate form with the historic basis of the Bank's assets, liabilities and equity unchanged as a result. Mercer Bancorp, Inc.is an emerging growth company, and, for as long as it continues to be an emerging growth company, it may choose to take advantage of exemptions from various reporting requirements applicable to other public companies but not to "emerging growth companies." Mercer Bancorp, Inc. intends to use the extended transition period to delay adoption of new or revised accounting pronouncements applicable to public companies until such pronouncements are made applicable to private companies. Accordingly, its financial statements may not be comparable to the financial statements of public companies that comply with such new or revised accounting standards.

Subsequent events have been evaluated through March 10, 2023, which is the date the financial statements were available to be issued.

**No person has been authorized to give any information or to make any representation other than as contained in this prospectus and, if given or made, such other information or representation must not be relied upon as having been authorized by Mercer Bancorp, Inc. or Mercer Savings Bank. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any of the securities offered hereby to any person in any jurisdiction in which such offer or solicitation is not authorized or in which the person making such offer or solicitation is not qualified to do so, or to any person to whom it is unlawful to make such offer or solicitation in such jurisdiction. Neither the delivery of this prospectus nor any sale hereunder shall under any circumstances create any implication that there has been no change in the affairs of Mercer Bancorp, Inc. or Mercer Savings Bank since any date as of which information is furnished herein or since the date of this prospectus.**

**Up to 1,495,000 Shares**

**(Subject to Increase to up to 1,719,250 Shares)**

![](tm238570d1_s1-img05.jpg)

**(Proposed Holding Company for Mercer Savings Bank)**

**COMMON STOCK**

**par value $0.01 per share**

**PROSPECTUS**

**PERFORMANCE TRUST**

**CAPITAL PARTNERS**

**[prospectus date]**

**These securities are not deposits or accounts and are not federally insured or guaranteed.**

**Until [date], all dealers that effect transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the obligation of dealers to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.**

------

**PART II**

**INFORMATION NOT REQUIRED IN PROSPECTUS**

**Item 13.** **Other Expenses of Issuance and Distribution**

---

| | |
|:---|:---|
|  | Estimated Amount |
| Registrant's Legal Fees and Expenses | $475000 |
| Registrant's Accounting Fees and Expenses | 240000 |
| Marketing Agent's Fees and Expenses | 385000 |
| Records Management Agent's Fees and Expenses | 55000 |
| Independent Appraiser's Fees and Expenses | 40000 |
| Printing, Postage, Mailing and EDGAR Fees and Expenses | 150000 |
| Filing Fees (NASDAQ, FINRA, SEC) | 10000 |
| Transfer Agent's Fees and Expenses | 35000 |
| Business Plan Consultant's Fees and Expenses | 50000 |
| Accounting Consultant's Fees and Expenses | 35000 |
| Proxy Solicitation Fees and Expenses | 20000 |
| Other | 50000 |
| Total | $1545000 |

---

(1) Estimated at the adjusted maximum of the offering range, assuming 100% of the shares are sold in the subscription
offering.

**Item 14.** **Indemnification of Directors and Officers**

Article 10 of the Articles of Incorporation of Mercer Bancorp, Inc. (the "Corporation") sets forth the circumstances under which directors, officers, employees and agents of the Corporation may be insured or indemnified against liability which they may incur in their capacities as such:

**<u>ARTICLE 10. Indemnification, etc. of Directors and Officers.</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**A. Indemnification.** The Corporation shall indemnify (1) its current and former directors and officers, whether serving the Corporation or at its request any other entity, to the fullest extent required or permitted by the Maryland General Corporation Law (the "MGCL") now or hereafter in force, including the advancement of expenses under the procedures and to the fullest extent permitted by law, and (2) other employees and agents to such extent as shall be authorized by the Board of Directors and permitted by law; provided, however, that, except as provided in Section B of this Article 10 with respect to proceedings to enforce rights to indemnification, the Corporation shall indemnify any such indemnitee in connection with a proceeding (or part thereof) initiated by such indemnitee only if such proceeding (or part thereof) was authorized by the Board of Directors of the Corporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**B. Procedure.** If a claim under Section A of this Article 10 is not paid in full by the Corporation within sixty (60) days after a written claim has been received by the Corporation, except in the case of a claim for an advancement of expenses, in which case the applicable period shall be twenty (20) days, the indemnitee may at any time thereafter bring suit against the Corporation to recover the unpaid amount of the claim. If successful in whole or in part in any such suit, or in a suit brought by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the indemnitee shall also be entitled to be reimbursed the expense of prosecuting or defending such suit. It shall be a defense to any action for advancement of expenses that the Corporation has not received both (i) an undertaking as required by law to repay such advances if it shall ultimately be determined that the standard of conduct has not been met and (ii) a written affirmation by the indemnitee of his good faith belief that the standard of conduct necessary for indemnification by the Corporation has been met. In (i) any suit brought by the indemnitee to enforce a right to indemnification hereunder (but not in a suit brought by the indemnitee to enforce a right to an advancement of expenses) it shall be a defense that, and (ii) any suit by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking the Corporation shall be entitled to recover such expenses upon a final adjudication that, the indemnitee has not met the applicable standard for indemnification set forth in the MGCL. Neither the failure of the Corporation (including its Board of Directors, independent legal

counsel, or its stockholders) to have made a determination before the commencement of such suit that indemnification of the indemnitee is proper in the circumstances because the indemnitee has met the applicable standard of conduct set forth in the MGCL, nor an actual determination by the Corporation (including its Board of Directors, independent legal counsel, or its stockholders) that the indemnitee has not met such applicable standard of conduct, shall create a presumption that the indemnitee has not met the applicable standard of conduct or, in the case of such a suit brought by the indemnitee, be a defense to such suit. In any suit brought by the indemnitee to enforce a right to indemnification or to an advancement of expenses hereunder, or by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the burden of proving that the indemnitee is not entitled to be indemnified, or to such advancement of expenses, under this Article 10 or otherwise shall be on the Corporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**C. Non-Exclusivity.** The rights to indemnification and to the advancement of expenses conferred in this Article 10 shall not be exclusive of any other right that any Person may have or hereafter acquire under any statute, these Articles, the Corporation's Bylaws, any agreement, any vote of stockholders or the Board of Directors, or otherwise.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**D. Insurance.** The Corporation may maintain insurance, at its expense, to insure itself and any director, officer, employee or agent of the Corporation or another corporation, partnership, joint venture, trust or other enterprise against any expense, liability or loss, whether or not the Corporation would have the power to indemnify such Person against such expense, liability or loss under the MGCL.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**E. Miscellaneous.** The Corporation shall not be liable for any payment under this Article 10 in connection with a claim made by any indemnitee to the extent such indemnitee has otherwise actually received payment under any insurance policy, agreement, or otherwise, of the amounts otherwise indemnifiable hereunder. The rights to indemnification and to the advancement of expenses conferred in Sections A and B of this Article 10 shall be contract rights and such rights shall continue as to an indemnitee who has ceased to be a director or officer and shall inure to the benefit of the indemnitee's heirs, executors and administrators.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**F. Limitations Imposed by Federal Law.** Notwithstanding any other provision set forth in this Article 10, in no event shall any payments made by the Corporation pursuant to this Article 10 exceed the amount permissible under applicable federal law, including, without limitation, Section 18(k) of the Federal Deposit Insurance Act and the regulations promulgated thereunder.

Any repeal or modification of this Article 10 shall not in any way diminish any rights to indemnification or advancement of expenses of such director or officer or the obligations of the Corporation arising hereunder with respect to events occurring, or claims made, while this Article 10 is in force.

**Item 15.** **Recent Sales of Unregistered Securities**

Not applicable.

**Item 16.** **Exhibits and Financial Statement Schedules**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) List of Exhibits

[1.1](tm238570d1_ex1-1.htm) [Engagement Letter between Mercer Savings Bank and Performance Trust Capital Partners, LLC (Marketing Agent Services)](tm238570d1_ex1-1.htm)

[1.2](tm238570d1_ex1-2.htm) [Engagement Letter between Mercer Savings Bank and Performance Trust Capital Partners, LLC (Records Agent and Stock Information Center Manager Services)](tm238570d1_ex1-2.htm)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3 Form of Agency Agreement by and among Mercer Bancorp, Inc., Mercer Savings Bank and Performance Trust Capital
Partners, LLC\*

[2](tm238570d1_ex2.htm) [Plan of Conversion](tm238570d1_ex2.htm)

[3.1](tm238570d1_ex3-1.htm) [Articles of Incorporation of Mercer Bancorp, Inc.](tm238570d1_ex3-1.htm)

[3.2](tm238570d1_ex3-2.htm) [Bylaws of Mercer Bancorp, Inc.](tm238570d1_ex3-2.htm)

[4](tm238570d1_ex4.htm) [Form of Common Stock Certificate of Mercer Bancorp, Inc.](tm238570d1_ex4.htm)

[5](tm238570d1_ex5.htm) [Opinion of Luse Gorman, PC regarding legality of securities being registered](tm238570d1_ex5.htm)

[8.1](tm238570d1_ex8-1.htm) [Form of Federal Income Tax Opinion of Luse Gorman, PC](tm238570d1_ex8-1.htm)

[8.2](tm238570d1_ex8-2.htm) [Form of State Income Tax Opinion of S.R. Snodgrass, P.C.](tm238570d1_ex8-2.htm)

[10.1](tm238570d1_ex10-1.htm) [Employment Agreement between Mercer Savings Bank and Alvin B. Parmiter](tm238570d1_ex10-1.htm)

[10.2](tm238570d1_ex10-2.htm) [Director Retirement Agreement between Mercer Savings Bank and Kristin M. Fee](tm238570d1_ex10-2.htm)

[10.3](tm238570d1_ex10-3.htm) [Director Retirement Agreement between Mercer Savings Bank and David L. Keiser](tm238570d1_ex10-3.htm)

[10.4](tm238570d1_ex10-4.htm) [Director Retirement Agreement between Mercer Savings Bank and Richard A. Mosier](tm238570d1_ex10-4.htm)

[10.5](tm238570d1_ex10-5.htm) [First Amendment to the Director Agreement between Mercer Savings Bank and Richard A. Mosier](tm238570d1_ex10-5.htm)

[10.6](tm238570d1_ex10-6.htm) [Form of Amendment to the Director Retirement Agreements](tm238570d1_ex10-6.htm)

[16.1](tm238570d1_ex16-1.htm) [Letter of Crowe LLP regarding change in accountants](tm238570d1_ex16-1.htm)

[16.2](tm238570d1_ex16-2.htm) [Letter of Dixon, Davis, Bagent & Company regarding change in accountants](tm238570d1_ex16-2.htm)

[21](tm238570d1_ex21.htm) [Subsidiaries of Mercer Bancorp, Inc.](tm238570d1_ex21.htm)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;23.1 Consent of Luse Gorman, PC (contained in Opinions included as [Exhibits 5](tm238570d1_ex5.htm) and [8.1](tm238570d1_ex8-1.htm))

[23.2](tm238570d1_ex23-2.htm) [Consent of FinPro, Inc.](tm238570d1_ex23-2.htm)

[23.3](tm238570d1_ex23-3.htm) [Consent of S.R. Snodgrass, P.C.](tm238570d1_ex23-3.htm)

---

| | |
|:---|:---|
| [24](#ss_020) | [Power of Attorney (set forth on signature page)](#ss_020) |

---

[99.1](tm238570d1_ex99-1.htm) [Engagement letter between Mercer Savings Bank and FinPro, Inc. with respect to independent appraisal services](tm238570d1_ex99-1.htm)

[99.2](tm238570d1_ex99-2.htm) [Letter of FinPro, Inc. with respect to value of subscription rights](tm238570d1_ex99-2.htm)

[99.3](tm238570d1_ex99-3.htm) [Appraisal Report of FinPro, Inc.](tm238570d1_ex99-3.htm)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;99.4 Marketing Materials\*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;99.5 Stock Order and Certification Form\*

[107](tm238570d1_ex-filingfees.htm) [Filing fees exhibit](tm238570d1_ex-filingfees.htm)

\* To be filed by amendment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Financial Statement Schedules

Financial statement schedules are not filed because the required information is inapplicable or is included in the consolidated financial statements and related notes.

**Item 17.** **Undertakings**

The undersigned Registrant hereby undertakes:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. 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 percent change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(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.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(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.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(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.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities:

The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424 (§230.424 of this chapter);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) That, for purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(6) That, for the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus 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.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(7) The undersigned registrant hereby undertakes to provide to the underwriter at the closing specified in the underwriting agreement, certificates in such denominations and registered in such names as required by the underwriter to permit prompt delivery to each purchaser.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(8) 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 foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act, and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the

registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question 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.

**SIGNATURES**

Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of Celina, State of Ohio, on March 10, 2023.

---

| | |
|:---|:---|
|  | **MERCER BANCORP, INC.** |
| By: | /s/ Alvin B. Parmiter |
|  | Alvin B. Parmiter |
|  | President and Chief Executive Officer |
|  | (Duly Authorized Representative) |

---

**POWER OF ATTORNEY**

We, the undersigned directors and officers of Mercer Bancorp, Inc. (the "Corporation") hereby severally constitute and appoint Alvin B. Parmiter, as our true and lawful attorney and agent, each to do any and all things in our names in the capacities indicated below which one or both said individuals may deem necessary or advisable to enable the Corporation to comply with the Securities Act of 1933, as amended, and any rules, regulations and requirements of the Securities and Exchange Commission, in connection with the registration statement on Form S-1 relating to the offering of the Corporation's common stock, including specifically, but not limited to, power and authority to sign for us in our names in the capacities indicated below the registration statement and any and all amendments (including post-effective amendments) thereto; and we hereby approve, ratify and confirm all that one or more of said individuals shall do or cause to be done by virtue thereof.

Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.

---

| | | |
|:---|:---|:---|
| <u>Signature</u> | <u>Title</u> | <u>Date</u> |
| /s/ Alvin B. Parmiter | President and Chief Executive Officer | March 10, 2023 |
| Alvin B. Parmiter | (Principal Executive Officer) |  |
| /s/ Rick L. Ross | Treasurer | March 10, 2023 |
| Rick L. Ross | (Principal Financial and Accounting Officer) |  |
| /s/ David L. Keiser | Chairman of the Board of Directors | March 10, 2023 |
| David L. Keiser |  |  |
| /s/ Kristin M. Fee | Vice Chair of the Board of Directors | March 10, 2023 |
| Kristin M. Fee |  |  |
| /s/ Michael J. Boley | Director | March 10, 2023 |
| Michael J. Boley |  |  |
| /s/ Jose W. Faller | Director | March 10, 2023 |
| Jose W. Faller |  |  |
| /s/ Richard A. Mosier | Director | March 10, 2023 |
| Richard A. Mosier |  |  |

---

## Exhibit 1.1

**Exhibit 1.1**

![](tm238570d1_ex1-1img01.jpg)

January 25, 2023

Barry Parmiter

President & CEO

Mercer Savings Bank

1100 Irmscher Blvd.

Celina, OH 45822

Dear Mr. Parmiter:

We understand that the Board of Directors of Mercer Savings Bank (the "<u>Bank</u>") is considering the adoption of a Plan of Conversion (the "<u>Plan</u>") pursuant to which the Bank will convert to stock form and in connection therewith (A) reorganize into the holding company form (the "Conversion") and (B) issue shares (the "<u>Shares</u>") of common stock (the "<u>Common Stock</u>") of a to-be-organized stock holding company (the "<u>Holding Company</u>") to be offered and sold in a public offering. The Holding Company and the Bank are sometimes collectively referred to herein as the "Company" and their respective boards of directors are sometimes collectively referred to as the "<u>Boards</u>." Performance Trust Capital Partners, LLC ("<u>Performance Trust</u>") is pleased to assist the Company on a best efforts basis with the Offering (as defined below), and this letter (the "<u>Agreement</u>") shall confirm the terms and conditions of our engagement as exclusive marketing agent to the Company.

Under the terms of the Plan and applicable regulations, the Shares will be offered first to eligible members of the Bank and the Bank's tax-qualified employee stock benefit plans (the "<u>Subscription Offering</u>"). Subject to the prior rights of subscribers in the Subscription Offering, the Shares may be offered in a community offering, with a preference given in the community offering to residents of the communities served by the Bank (the "<u>Community Offering</u>," and together with the Subscription Offering, the "<u>Subscription and Community Offering</u>"). Shares not subscribed for in the Subscription and Community Offering, if any, may be offered to the general public by Performance Trust on a best efforts basis (the "<u>Syndicated Offering</u>" and together with the Subscription and Community Offering, the "<u>Offering</u>"). Performance Trust may, in consultation with the Company, form a syndicate of registered dealers to assist in any Syndicated Offering.

<u>SERVICES</u>

Performance Trust will act as exclusive marketing agent for the Company in the Offering. We will work with the Company and its management, counsel, accountants and other advisors on the Offering and anticipate that our services (the "Services") will include the following, each as may be necessary and as the Company may reasonably request:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Consulting as to the marketing implications of any aspect of the Plan;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Reviewing with the Boards the financial impact of the Offering on the Company, based upon an independent
appraiser's appraisal of the common stock;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Reviewing all offering documents, including the prospectus, stock order forms and related offering materials
(it being understood that preparation and filing of such documents will be the responsibility of the Company and its counsel);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. Assisting in the design and implementation of a marketing strategy for the Offering;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. Assisting Company management in scheduling and preparing for meetings with potential investors and/or other broker-dealers in connection
with the Offering; and

![](tm238570d1_ex1-1img02.jpg)

![](tm238570d1_ex1-1img01.jpg)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. Providing such other general advice and assistance as may be reasonably requested to promote the successful
completion of the Offering.

<u>SUBSCRIPTION AND COMMUNITY OFFERING FEES</u>

If the Offering is consummated, the Company agrees to pay Performance Trust a Success Fee equal to the greater of (a) Two Hundred and Fifty Thousand Dollars ($250,000) and (b) one percent (1.00%) of the aggregate Actual Purchase Price of the Shares sold in the Subscription and Community Offering, excluding Shares purchased by or on behalf of (i) any employee benefit plan or trust of the Company established for the benefit of its directors, officers and employees, (ii) any charitable foundation established by the Company (or any shares contributed to such a charitable foundation); and (iii) any director, trustee, corporator, officer or employee of the Company ("Insiders") or members of the Immediate Family of such persons (whether directly or through a personal trust) (the "Selling Agent Fee"). "Immediate Family" includes the spouse, parents, siblings and children of Insiders who live in the same house as the Insiders. For purposes of this letter, the term "Actual Purchase Price" shall mean the price at which the Shares of Common Stock are sold in the Offering.

If (a) Performance Trust's engagement hereunder is terminated for any of the reasons provided for under the second paragraph of the section of this letter captioned "Definitive Agreement," or (b) the Offering is terminated by the Company, no fees shall be payable by the Company to Performance Trust hereunder; however, the Company shall reimburse Performance Trust for the reasonable out-of-pocket expenses (including legal fees) incurred by or on behalf of Performance Trust in connection with its engagement hereunder and for any fees and expenses incurred by Performance Trust on behalf of the Company pursuant to the second paragraph under the section captioned "Costs and Expenses" below.

All fees and expense reimbursements payable to Performance Trust hereunder shall be payable in immediately available funds at the time of the closing of the Offering, or upon the termination of Performance Trust's engagement hereunder or termination of the Offering, as the case may be. In recognition of the long lead times involved in the stock offering process, the Company has agreed to make an advance payment (the "Management Fee") to Performance Trust in the amount of Twenty-Five Thousand Dollars ($25,000). In the event that the Management Fee exceeds the amount due in payment of fees and reimbursement of expenses hereunder, the excess shall be promptly refunded to the Company. The Management Fee will be credited against any payment hereunder of the Selling Agent Fee.

<u>SYNDICATED OFFERING</u>

If any shares of the Common Stock remain available after the expiration of the Subscription and Community Offering, at the request of the Company and subject to the continued satisfaction of the conditions set forth in the second paragraph under the section captioned "Definitive Agreement" below, Performance Trust will seek to sell such Common Stock in a Syndicated Offering on a best efforts basis, subject to the terms and conditions to be set forth in a selected dealers agreement, and may, in consultation with the Company, form a syndicate of registered dealers to assist in such efforts. With respect to any Shares of Common Stock sold by Performance Trust or any other FINRA member firm under any selected dealers agreements in a Syndicated Offering, the Company agrees to pay a commission of five percent (5.00%) of the aggregate Actual Purchase Price of the Shares of Common Stock sold in such Syndicated Offering. Performance Trust will endeavor to distribute the Common Stock among dealers in a fashion that best meets the distribution objectives of the Company and the requirements of the Plan, which may result in limiting the allocation of stock to certain selected dealers. It is understood that in no event shall Performance Trust or any other member of the syndicate be obligated to take or purchase any shares of the Common Stock in the Offering.

![](tm238570d1_ex1-1img02.jpg)

![](tm238570d1_ex1-1img01.jpg)

<u>COSTS AND EXPENSES</u>

In addition to any fees that may be payable to Performance Trust hereunder and the expenses to be borne by the Company pursuant to the following paragraph, the Company agrees to reimburse Performance Trust, upon request made from time to time, for its reasonable out-of-pocket expenses incurred in connection with its engagement hereunder, regardless of whether the Offering is consummated, including, without limitation, legal fees and expenses, communications, syndication and travel expenses, up to a maximum of One Hundred Thousand Dollars ($100,000) for legal fees and expenses, and Ten Thousand Dollars ($10,000) for all other out-of-pocket expenses, which may be increased to Twenty Thousand Dollars ($20,000) in the aggregate in the event of resolicitation of subscribers; *provided, however*, that Performance Trust shall document such expenses to the reasonable satisfaction of the Company. The provisions of this paragraph are not intended to apply to or in any way impair the indemnification provisions of this letter.

As is customary, the Company will bear all other expenses incurred in connection with the Offering, including, without limitation, (i) the cost of obtaining all securities and bank regulatory approvals, including any required FINRA filing fees; (ii) the cost of printing and distributing the offering materials; (iii) the costs of blue sky qualification (including fees and expenses of blue sky counsel) of the Shares in the various states; (iv) listing fees; (v) all fees and disbursements of the Company's counsel, accountants, records management agent, proxy tabulators and solicitors, transfer agent and other advisors; and (vi) the establishment and operational expenses for the Stock Information Center (e.g., postage, telephones, supplies, temporary employees, etc.). In the event Performance Trust incurs any such fees and expenses on behalf of the Company, the Company will reimburse Performance Trust for such fees and expenses whether or not the Offering is consummated, provided, however, that Performance Trust shall not incur any substantial expenses on behalf of the Company without prior approval.

<u>DUE DILIGENCE REVIEW</u>

Performance Trust's obligation to perform the services contemplated by this letter shall be subject to the satisfactory completion of such investigation and inquiries relating to the Company and its directors, trustees, officers, agents and employees, as Performance Trust and its counsel in their sole discretion may deem appropriate under the circumstances. In this regard, the Company agrees that, at its expense, it will make available to Performance Trust all information that Performance Trust requests, and will allow Performance Trust the opportunity to discuss with the management of the Company the financial condition, business and operations of the Company. The Company acknowledges that Performance Trust will rely upon the accuracy and completeness of all information received from the Company and its directors, trustees, officers, employees, agents, independent accountants and counsel.

<u>BLUE SKY MATTERS</u>

Performance Trust and the Company agree that the Company's counsel shall serve as counsel with respect to blue sky matters in connection with the Offering. The Company will cause such counsel to prepare a Blue Sky Memorandum related to the Offering, including Performance Trust 's participation therein, and shall furnish Performance Trust a copy thereof addressed to the Company and Performance Trust.

<u>CONFIDENTIALITY</u>

Except as contemplated in connection with the performance of its services under this agreement, as authorized by the Company or as required by law, regulation, legal process or order of any court or governmental or regulatory authority, Performance Trust agrees that it will treat as confidential all material, non-public information relating to the Company obtained in connection with its engagement hereunder (the "<u>Confidential Information</u>"); *provided, however*, that Performance Trust may disclose such information to its employees, consultants, agents and advisors who are assisting or advising Performance Trust in performing its services hereunder and who have been directed to observe the terms and conditions of this section or are subject to requirements substantially equivalent thereto. As used in this paragraph, the term "Confidential Information" shall not include information that (a) is or becomes generally available to the public other than as a result of a disclosure by Performance Trust in breach of the confidentiality obligations contained herein, (b) was available to Performance Trust on a non-confidential basis prior to its disclosure to Performance Trust by the Company, (c) becomes available to Performance Trust on a non-confidential basis from a person other than the Company who is not otherwise known to Performance Trust to be bound not to disclose such information pursuant to a contractual, legal or fiduciary obligation owed to the Company, or (d) is independently developed by Performance Trust without use of or reference to the Confidential Information disclosed hereunder.

![](tm238570d1_ex1-1img02.jpg)

![](tm238570d1_ex1-1img01.jpg)

Upon the written request of the Company, Performance Trust will promptly, but in any event within ten (10) business days after receipt of such request, return, destroy or cause the return or destruction of all Confidential Information in written form or set forth in other tangible media provided to it by or on behalf of the Company (in each case including all copies); *provided, however*, that nothing herein will be construed to limit Performance Trust's ability to retain archival or backup copies of Confidential Information as may be required to fulfill its legal and regulatory obligations or its compliance and recordkeeping obligations, policies or procedures. Performance Trust shall promptly confirm to the Company in writing any destruction of materials. Confidential Information not returned or destroyed (including, without limitation, any oral Confidential Information) shall remain subject to the confidentiality obligations set forth in this Agreement. The Company represents that it has all rights necessary to disclose or provide Confidential Information to Performance Trust under the terms hereof and that such Confidential Information will not contain or reflect any material inaccuracies or omissions.

If Performance Trust is requested or required under applicable law or regulation, or by questions, interrogatories, requests for information or documents, subpoena, civil investigative demand or other legally binding process, to disclose any Confidential Information relating to the Company, Performance Trust (if practicable and legally permitted to do so) will provide the Company with prompt notice (written, if practicable) of any such request or requirement and otherwise provide commercially reasonable cooperation to the Company (at the Company's expense) so that the Company may seek an appropriate protective order or other appropriate remedy or waive, in writing, compliance with the provisions of this Agreement. Notwithstanding the foregoing, no such notice shall be required in the case of a routine audit or regulatory or administrative exam or review of Performance Trust not specifically related to the Company. In the event that such protective order or other remedy is not obtained, or to the extent that the Company grants a written waiver hereunder, Performance Trust (A) may furnish that portion (and only that portion) of the Confidential Information that it is legally compelled to disclose and agrees to exercise its commercially reasonable efforts to request that confidential treatment will be accorded to such information by the party compelling such disclosure, and (B) will not oppose action by the Company to obtain an appropriate protective order or other reliable assurance that confidential treatment will be accorded the Confidential Information.

The Company hereby acknowledges and agrees that the financial models and presentations used by Performance Trust in performing its services hereunder have been developed by and are proprietary to Performance Trust and are protected under applicable law, and agrees that it will not reproduce or distribute all or any portion of such models or presentations without the prior written consent of Performance Trust.

![](tm238570d1_ex1-1img02.jpg)

![](tm238570d1_ex1-1img01.jpg)

<u>INDEMNIFICATION</u>

Each of the Bank and the Holding Company, jointly and severally, agrees to indemnify and hold Performance Trust and its affiliates and their respective partners, directors, officers, employees, agents and controlling persons within the meaning of Section 15 of the Securities Act of 1933, as amended, or Section 20 of the Securities Exchange Act of 1934, as amended (collectively the "<u>Performance Trust Indemnified Parties</u>" and each such person being an "<u>Performance Trust Indemnified Party</u>") harmless from and against any and all losses, claims, damages and liabilities, joint or several, to which such Performance Trust Indemnified Party may become subject under applicable federal or state law, or otherwise, (i) arising out of or based upon any untrue statement or alleged untrue statement of a material fact contained in the offering documents, including documents described or incorporated by reference therein, or in any other written or oral communication provided by or on behalf of the Holding Company or the Bank to any actual or prospective purchaser of the Shares or arising out of or based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading, (ii) arising out of or based in whole or in part on any inaccuracy in the representations or warranties of the Holding Company or the Bank contained in any agency agreement, or any failure of the Holding Company or the Bank to perform its respective obligations thereunder or (iii) related to or arising out of the Offering or the engagement of Performance Trust pursuant to, or the performance by Performance Trust of the services contemplated by, this letter, and will reimburse any Performance Trust Indemnified Party for all expenses (including reasonable legal fees and expenses) as they are incurred, including expenses incurred in connection with the investigation of, preparation for or defense of any pending or threatened claim or any action or proceeding arising therefrom, whether or not such Indemnified Party is a party; *provided, however*, that the Company will not be liable to Performance Trust in its capacity as marketing agent (a) to the extent that any such loss, claim, damage, liability or expense arises out of or is based upon any untrue statement of a material fact or the omission of a material fact required to be stated therein or necessary to make not misleading any statements contained in any final prospectus, or any amendment or supplement thereto, made in reliance on and in conformity with written information furnished to the Company by Performance Trust expressly for use therein, or (b) under clause (iii) of this paragraph to the extent that it is finally determined by the non-appealable decision of a court of competent jurisdiction that any such loss, claim, damage, liability or expense is primarily attributable to the gross negligence, bad faith or willful misconduct of Performance Trust. If the foregoing indemnification is unavailable for any reason other than for the reasons stated in subparagraph (a) or (b) above, the Company agrees to contribute to such losses, claims, damages, liabilities and expenses in the proportion that its financial interest in the Offering bears to that of Performance Trust; *provided, however,* in no event shall Performance Trust's aggregate contribution to the amount paid or payable exceed the aggregate amount of fees actually received by Performance Trust pursuant to the provisions of this Agreement. The Company further agrees that neither Performance Trust nor any of its controlling persons, affiliates, partners, directors, officers, employees or consultants shall have any liability to the Holding Company or the Bank or any person asserting claims on behalf of or in right of the Holding Company or the Bank for any losses, claims, damages, liabilities or expenses arising out of or relating to this agreement or the services to be rendered by Performance Trust hereunder, unless it is finally judicially determined by the non-appealable decision of a court of competent jurisdiction, that such losses, claims, damages, liabilities or expenses are primarily attributable to the gross negligence, bad faith or willful misconduct of Performance Trust.

Each of the Bank and the Holding Company agrees to notify Performance Trust promptly of the assertion against it or any other person of any claim or the commencement of any action or proceeding relating to any transaction contemplated by this Agreement. Each of the Bank and the Holding Company will not, without Performance Trust's prior written consent, settle, compromise, consent to the entry of any judgment in or otherwise seek to terminate any claim, action or proceeding in respect of which indemnity may be sought hereunder, whether or not any Performance Trust Indemnified Party is an actual or potential party thereto, unless such settlement, compromise, consent or termination (i) includes an explicit and unconditional release of each Performance Trust Indemnified Party from any liabilities arising out of such claim, action or proceeding and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any Performance Trust Indemnified Party. If the Holding Company or the Bank enters into any agreement or arrangement with respect to, or effects, any proposed sale, exchange, dividend or other distribution or liquidation of all or substantially all of its assets in one or a series of transactions, the Bank or the Holding Company, as the case may be, shall provide for the assumption of its obligations under this section by the purchaser or transferee of such assets or another party reasonably satisfactory to Performance Trust.

In no event shall a Performance Trust Indemnified Party be liable for any consequential, indirect, incidental, or special damages. The defense, indemnity, reimbursement, contribution and other obligations and agreements of Bank and the Holding Company set forth herein shall apply to any modifications of this Agreement, and shall be in addition to any liability which Performance Trust may otherwise have. The rights of the indemnified parties under this Agreement shall be in addition to any rights that any Performance Trust Indemnified Party may have at common law, in equity, or otherwise. For the sole purpose of enforcing and otherwise giving effect to the provisions of this Agreement, the Bank and the Holding Company hereby consent to personal jurisdiction and service and venue in any court in which any claim which is subject to this Agreement is brought against the Performance Trust Indemnified Parties.

![](tm238570d1_ex1-1img02.jpg)

![](tm238570d1_ex1-1img01.jpg)

The reimbursement, indemnity and contribution obligations of each of the Bank and the Holding Company set forth herein shall apply to any modification of this Agreement and shall remain in full force and effect regardless of any termination of, or the completion of any indemnified person's services hereunder.

Notwithstanding any other provision set forth in this Agreement, in no event shall any payments made by the Bank or the Holding Company pursuant to this Agreement exceed the amount permissible under applicable federal law, including, without limitation, Section 18(k) of the Federal Deposit Insurance Act and the regulations promulgated thereunder.

<u>MATTERS RELATING TO ENGAGEMENT</u> 

The Company acknowledges and agrees that, except as set forth in the separate engagement letter with the Company dated as of the date hereof, Performance Trust has been engaged solely as an independent contractor to provide the Services set forth herein. In rendering such Services, Performance Trust will be acting solely pursuant to a contractual relationship on an arm's length basis with respect to such Services (including in connection with determining the terms of each Investment) and not as a fiduciary to the Company or any other person. Additionally, the Company acknowledges that Performance Trust is not advising the Company or any other person as to any legal, tax, investment, accounting or regulatory matters in any jurisdiction. The Company shall consult with its own advisors concerning such matters and Performance Trust shall have no responsibility or liability to the Company with respect thereto. The Company also acknowledges that nothing in this Agreement is intended to create duties to the Company beyond those expressly provided for in this Agreement or to create duties of any kind to the Company's creditors or security holders, and Performance Trust and the Company specifically disclaim the creation of any fiduciary relationship between, or the imposition of any fiduciary duties on, either party. Finally, the Company agrees that Performance Trust may perform the Services contemplated hereby in conjunction with its affiliates, and that any affiliates of Performance Trust performing Services hereunder shall be entitled to the benefits and be subject to the terms of this Agreement.

The Company acknowledges that Performance Trust is a securities firm engaged in securities, trading and brokerage activities and providing investment banking and financial advisory services. In addition, Performance Trust and its affiliates may from time to time perform various investment banking and financial advisory services for other clients and customers who may have conflicting interests with respect to you. The Company also acknowledges that Performance Trust and its affiliates have no obligation to use in connection with this engagement or to furnish the Company, confidential information obtained from other persons.

It is understood that the provisions herein relating to the payment of fees and expenses and those relating to governing law and submission to jurisdiction, and those contained under the captions "Confidentiality" and "Indemnification" will survive any termination of this Agreement.

<u>REPRESENTATIONS</u>

The Bank represents and warrants that it has all requisite power and authority to enter into and carry out the terms and provisions of this Agreement, the execution, delivery and performance of this Agreement does not breach or conflict with any agreement, document or instrument to which it is a party or bound and this Agreement has been duly authorized, executed and delivered by it.

<u>DEFINITIVE AGREEMENT</u>

Performance Trust and the Company agree that (a) except as set forth in clause (b), the foregoing represents the general intention of the Company and Performance Trust with respect to the Services to be provided by Performance Trust in connection with the Offering, which will serve as a basis for Performance Trust commencing activities, and (b) the only legal and binding obligations of the Company and Performance Trust with respect to the Offering shall be (1) the Company's obligation to reimburse costs and expenses pursuant to the section captioned "Costs and Expenses," (2) those set forth under the captions "Confidentiality", "Representations" and "Indemnification," and (3) as set forth in a duly negotiated and executed definitive agency agreement (the "Agency Agreement") to be entered into prior to the commencement of the Offering relating to the services of Performance Trust in connection with the Offering. Such Agency Agreement shall be in form and content satisfactory to Performance Trust and the Company and their respective counsel and shall contain standard indemnification and contribution provisions consistent herewith.

![](tm238570d1_ex1-1img02.jpg)

![](tm238570d1_ex1-1img01.jpg)

Performance Trust's execution of such Agency Agreement shall also be subject to (i) Performance Trust's satisfaction with its investigation of the Company's business, financial condition and results of operations, (ii) preparation of offering materials that are satisfactory to Performance Trust and its counsel, (iii) compliance with all relevant legal and regulatory requirements to the reasonable satisfaction of Performance Trust, (iv) agreement that the price established by the independent appraiser is reasonable, and (v) market conditions at the time of the commencement of the proposed Offering. Performance Trust may terminate this agreement if such Agency Agreement is not entered into prior to September 30, 2023.

This Agreement and any claim, controversy or dispute arising under or related to this Agreement shall be governed by and construed in accordance with the laws of the State of Illinois, without giving effect to the conflicts of laws principles thereof. The Company and Performance Trust irrevocably agree to waive trial by jury in any action, proceeding, claim or counterclaim brought by or on behalf of either party related to or arising out of this Agreement or the performance of services hereunder.

Each of the parties hereto irrevocably agrees that, except as otherwise set forth in this paragraph, any state or federal court sitting in the City of Chicago shall have exclusive jurisdiction to hear and determine any suit, action or proceeding and to settle any dispute arising out of or relating to this Agreement and, for such purposes, irrevocably submits to the jurisdiction of such courts. The Company hereby agrees that service of any process, summons, notice or document by hand delivery or registered mail addressed to the Company, shall be effective service of process for any suit, action or proceeding brought in any such court. The Company irrevocably and unconditionally waives any objection to the laying of venue of any such suit, action or proceeding brought in any such court and any claim that any such suit, action or proceeding has been brought in an inconvenient forum. The Company agrees that a final judgment in any such suit, action or proceeding brought in any such court shall be conclusive and binding upon the Company and may be enforced in any other court to whose jurisdiction the Company is or may in the future be subject, by suit upon judgment. The Company further agrees that nothing herein shall affect Performance Trust's right to effect service of process in any other manner permitted by law or to bring a suit, action or proceeding (including a proceeding for enforcement of a judgment) in any other court or jurisdiction in accordance with applicable law. This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and can be altered only by written consent signed by the parties.

*(Remainder of Page Intentionally Left Blank)*

 

 

 

Please confirm that the foregoing correctly sets forth our agreement by signing and returning to Performance Trust the duplicate copy of this letter enclosed herewith.

---

| | | | |
|:---|:---|:---|:---|
| | | Very truly yours, | Very truly yours, |
| | | **PERFORMANCE TRUST CAPITAL PARTNERS, LLC** | **PERFORMANCE TRUST CAPITAL PARTNERS, LLC** |
| | | By: | /s/ R. Lee Burrows |
| | | Lee Burrows Vice Chairman of Investment Banking | Lee Burrows Vice Chairman of Investment Banking |
| Accepted and agreed to as of the date first above written: | Accepted and agreed to as of the date first above written: |  |  |
| **Mercer Savings Bank** | **Mercer Savings Bank** |  |  |
| By: | /s/ Alvin B. Parmiter |  |  |
| Barry Parmiter | Barry Parmiter |  |  |
| President & CEO | President & CEO |  |  |

---

![](tm238570d1_ex1-1img02.jpg)

## Exhibit 1.2

**Exhibit 1.2**

![](tm238570d1_ex1-2img01.jpg)

January 23, 2023

Barry Parmiter

President & CEO

Mercer Savings Bank

1100 Irmscher Blvd.

Celina, OH 45822

Dear Mr. Parmiter:

We understand that the Board of Directors of Mercer Savings Bank (the "<u>Bank</u>") is considering the adoption of a Plan of Conversion (the "<u>Plan</u>") pursuant to which the Bank will convert to stock form and in connection therewith (A) reorganize into the holding company form (the "Conversion") and (B) issue shares (the "<u>Shares</u>") of common stock (the "<u>Common Stock</u>") of a to-be-organized stock holding company (the "<u>Holding Company</u>") to be offered and sold in a public offering. The Holding Company and the Bank are sometimes collectively referred to herein as the "Company" and their respective boards of directors are sometimes collectively referred to as the "<u>Boards</u>." Performance Trust Capital Partners, LLC ("<u>Performance Trust</u>") is pleased to assist the Company on a best efforts basis with the Offering (as defined below), and this letter (the "<u>Agreement</u>") shall confirm the terms and conditions of our engagement as records agent and stock information center manager to the Company.

Under the terms of the Plan and applicable regulations, the Shares will be offered first to eligible members of the Bank and the Bank's tax-qualified employee stock benefit plans (the "<u>Subscription Offering</u>"). Subject to the prior rights of subscribers in the Subscription Offering, the Shares may be offered in a community offering, with a preference given in the community offering to residents of the communities served by the Bank (the "<u>Community Offering</u>," and together with the Subscription Offering, the "<u>Subscription and Community Offering</u>"). Shares not subscribed for in the Subscription and Community Offering, if any, may be offered to the general public by Performance Trust on a best efforts basis (the "<u>Syndicated Offering</u>" and together with the Subscription and Community Offering, the "<u>Offering</u>"). Performance Trust may, in consultation with the Company, form a syndicate of registered dealers to assist in any Syndicated Offering.

**<u>SERVICES AND FEES</u>**

In our role as Records Agent and Stock Information Center Manager in relation to the transaction contemplated by this Agreement, we anticipate that our services will include the services outlined below, each as may be necessary and as the Company may reasonably request.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Records Agent services including but not limited to -

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Consolidation of customer accounts for voting and offering purposes;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Coordination with the Company's financial printer for labeling and mailing of all proxy and offering
materials;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Provide supporting account information to the Company's legal counsel for "blue sky"
research and applicable registration;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Assist the Company's transfer agent with the generation and mailing of statements of ownership,
interest and refund checks, and 1099-INT statements as required;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Coordinate proxy tabulation and solicitation efforts to be provided by third parties; and

![](tm238570d1_ex1-2img02.jpg)

![](tm238570d1_ex1-2img01.jpg)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Subscription Services

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Stock Information Center Manager services including but not limited to -

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Coordinating vote solicitation and the special meeting of members (if applicable);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Design of the stock order forms;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Organization and supervision of the Stock Information Center;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;• Employee training.

Performance Trust will provide the records agent services contemplated hereby. The parties hereto expressly acknowledge and agree that Performance Trust may, in its discretion as it sees fit, subcontract certain records agent services, including without limitation certain integral data processing functions, to any one or more of its affiliates or any non-affiliate third parties. Performance Trust shall exercise due care in selecting any non-affiliate third parties. For its services hereunder, the Company agrees to pay Performance Trust a fee of Thirty Thousand Dollars ($30,000), with Ten Thousand Dollars ($10,000) payable upon the mailing of Offering materials to prospective subscribers and the balance paid on the day of the closing of the Offering. This fee is based upon the requirements of current regulations and the Plan as currently contemplated. Any unusual or additional items or duplication of service required as a result of a material change in the regulations or the Plan, a material delay, required resolicitation of the Offering or other similar events may result in extra charges that will be covered in a separate agreement if and when they occur and shall not exceed Ten Thousand Dollars ($10,000). The Company will inform Performance Trust within a reasonable period of any changes in the Plan that require changes in Performance Trust's services. Fees under this Agreement shall be payable in immediately available funds when invoiced.

It is understood that all expenses associated with the operation of the Stock Information Center will be borne by the Company. The Company also agrees to reimburse Performance Trust, upon request made from time to time, for its reasonable out-of-pocket expenses incurred in connection with its engagement hereunder, regardless of whether the Offering is consummated, including, without limitation, travel, lodging, food, telephone, postage, data processing and data entry services, communications and other similar expenses, up to a maximum of Twenty-Five Thousand Dollars ($25,000); *provided, however,* that Performance Trust shall document such expenses to the reasonable satisfaction of the Company. The provisions of this paragraph are not intended to apply to or in any way impair the indemnification provisions of this Agreement.

**<u>RELIANCE ON INFORMATION PROVIDED</u>**

The Company will provide Performance Trust with such information as Performance Trust may reasonably require to carry out its duties hereunder. The Company recognizes and confirms that Performance Trust (a) will use and rely on such information in performing the services contemplated by this Agreement without having independently verified the same, and (b) does not assume responsibility for the accuracy or completeness of the information provided by the Company.

To help the United States government fight the funding of terrorism and money laundering activities, the federal law of the United States requires all financial institutions to obtain, verify and record information that identifies each person with whom they do business. This means Performance Trust may ask the Company and its significant shareholders or equity holders for certain identifying information and documents, including a government-issued identification number (e.g., a U.S. taxpayer identification number) and copies of documents containing personal identifying information, and such other information or documents that Performance Trust and its counsel consider appropriate to verify the bona fide existence of the Company (e.g., certified articles of incorporation, a government-issued business license, a partnership agreement or a trust instrument) and the identities of its significant shareholders or equity holders.

![](tm238570d1_ex1-2img02.jpg)

![](tm238570d1_ex1-2img01.jpg)

**<u>CONFIDENTIALITY</u>**

Except as contemplated in connection with the performance of its services under this agreement, as authorized by the Company or as required by law, regulation, legal process or order of any court or governmental or regulatory authority, Performance Trust agrees that it will treat as confidential all material, non-public information relating to the Company obtained in connection with its engagement hereunder (the "Confidential Information"); provided, however, that Performance Trust may disclose such information to its affiliates, partners, directors, employees, agents and advisors who are assisting or advising Performance Trust in performing its services hereunder and who have been directed to comply with the terms and conditions of this section. As used in this section, the term "Confidential Information" shall not include information which (a) is or becomes generally available to the public other than as a result of a disclosure by Performance Trust in breach of the confidentiality obligations contained herein, (b) was available to Performance Trust on a non-confidential basis prior to its disclosure to Performance Trust by the Company, (c) becomes available to Performance Trust on a non-confidential basis from a person other than the Company who is not otherwise known to Performance Trust to be bound not to disclose such information pursuant to a contractual, legal or fiduciary obligation owed to the Company, or (d) is independently developed by Performance Trust without use of or reference to the Confidential Information disclosed hereunder.

Upon the written request of the Company, Performance Trust will promptly, but in any event within ten (10) business days after receipt of such request, return, destroy (to the extent technically practicable) or cause the return or destruction of all Confidential Information in written form or set forth in other tangible media provided to it by or on behalf of the Company (in each case including all copies); *provided, however*, that nothing herein will be construed to limit Performance Trust's ability to retain archival copies of Confidential Information as may be required to fulfill its legal and regulatory obligations and its compliance and recordkeeping obligations policies or procedures. Any destruction of materials shall be verified promptly to the Company by Performance Trust in writing. Any Confidential Information that has not been returned or destroyed, including, without limitation, any oral Confidential Information, shall remain subject to the confidentiality obligations set forth in this Agreement.

If Performance Trust is requested or required under applicable law or by oral questions, interrogatories, requests for information or documents, subpoena, civil investigative demand or other legally binding process, to disclose any Confidential Information relating to the Company, it is agreed that Performance Trust (if legally permitted to do so) will provide the Company with prompt notice of any such request or requirement (written, if practical) and otherwise provide reasonable cooperation the Company (at the Company's expense) in order to enable the Company to seek an appropriate protective order or other appropriate remedy or to waive compliance with the provisions of this Agreement. Notwithstanding the foregoing, no such notice shall be required in the case of a routine audit or regulatory or administrative review of Performance Trust not specifically related to the Company. In the event that such protective order or other remedy is not obtained, or to the extent that the Company grants a written waiver hereunder, Performance Trust may furnish that portion (and only that portion) of the Confidential Information, which it is legally compelled to disclose and with respect to which it agrees to exercise its commercially reasonable efforts to obtain reliable assurance that confidential treatment will be accorded to such information by the receiving party compelling such disclosure. In any event, Performance Trust will not oppose action by the Company to obtain an appropriate protective order or other reliable assurance that confidential treatment will be accorded the Confidential Information.

**<u>LIMITATIONS</u>**

Performance Trust, as Records Agent and Stock Information Center Manager hereunder, (a) shall have no duties or obligations other than those specifically set forth herein; (b) will be regarded as making no representations and having no responsibilities as to the validity, sufficiency, value or genuineness of any order form or any stock certificates or statements of ownership or the shares represented thereby, and will not be required to and will make no representations as to the validity, value or genuineness of the Offering; (c) shall not be liable to any person or entity, including the Company, by reason of any error of judgment or for any act done by it in good faith, or for any mistake of law or fact in connection with this Agreement and the performance hereof; (d) will not be obliged to take any legal action hereunder which might in its judgment involve any expense or liability, unless it shall have been furnished with reasonable indemnity satisfactory to it (as provided for in the Indemnification section below); and (e) may reasonably rely on and shall be protected in acting in reasonable reliance upon any certificate, instrument, opinion, notice, letter, telex, telegram, or other document or security delivered to it and in good faith believed by it to be genuine and to have been signed by the proper party or parties.

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Anything in this Agreement to the contrary notwithstanding, in no event shall Performance Trust be liable for special, indirect or consequential loss or damage of any kind whatsoever (including but not limited to lost profits), even if Performance Trust has been advised of the likelihood of such loss or damage and regardless of the form of action.

**<u>INDEMNIFICATION</u>**

In connection with Performance Trust's engagement to advise and assist the Company as provided herein, each of the Bank and the Holding Company jointly and severally agrees to indemnify and hold Performance Trust and its affiliates and their respective partners, directors, officers, employees, agents and controlling persons within the meaning of Section 15 of the Securities Act of 1933 or Section 20 of the Securities Exchange Act of 1934 (Performance Trust and each such person being an "Indemnified Party") harmless, to the fullest extent permitted by law, from and against any and all losses, direct or class action claims, damages, costs and liabilities, joint or several, to which such Indemnified Party may become subject under applicable federal or state law, or otherwise, related to or arising out of Performance Trust's role as Records Agent and Stock Information Center Manager or the Offering or the engagement of Performance Trust pursuant to, or the performance by Performance Trust of the services contemplated by, this Agreement, and will reimburse any Indemnified Party for all expenses (including reasonable legal fees and expenses and costs of production or response) as they are incurred, including expenses incurred in connection with the investigation, responding, preparation for or defense of any pending or threatened regulatory inquiry, subpoena or discovery response, claim or any action or other proceeding arising therefrom, whether or not in connection with pending or threatened litigation in which Indemnified Party is a party or inquiry of which Indemnified Party is subject; *provided, however,* that the Company will not be liable in any such case to the extent that any such loss, claim, damage, liability or expense is finally judicially determined by the non-appealable decision of a court of competent jurisdiction to be primarily attributable to Performance Trust's gross negligence, bad faith or willful misconduct.

If the foregoing indemnification is determined to be unavailable for any reason (other than the applicability of the proviso to the immediately preceding sentence), then, in lieu of indemnifying such Indemnified Party, the Company agrees to contribute to such losses, claims, damages, costs, liabilities and expenses (a) in such proportion as is appropriate to reflect the relative benefits to the Company, on the one hand, and Performance Trust, on the other hand, of the engagement provided for in this Agreement or (b) if the allocation provided for in clause (a) above is not available, in such proportion as is appropriate to reflect not only the relative benefits referred to in such clause (a) but also the relative fault of each of the Company and Performance Trust, as well as any other relevant equitable consideration; *provided, however*, in no event shall Performance Trust's aggregate contribution to the amount paid or payable exceed the aggregate amount of fees actually received by Performance Trust under this Agreement. For the purposes of this Agreement, the relative benefits to the Company and to Performance Trust of the engagement under this Agreement shall be deemed to be in the same proportion as (a) the total value paid or contemplated to be paid or received or contemplated to be received by the Company or the Company's members or other stakeholders, as the case may be, in the Offering that is the subject of the engagement hereunder, whether or not any such Offering is consummated, bears to (b) the fees paid or to be paid to Performance Trust under this Agreement.

The Company agrees to notify Performance Trust promptly of the assertion against it or any other person of any claim or the commencement of any action or proceeding relating to any transaction contemplated by this Agreement. The Company will not, without Performance Trust's prior written consent, settle, compromise, consent to the entry of any judgment in or otherwise seek to terminate any claim, action or proceeding in respect of which indemnity may be sought hereunder, whether or not any Indemnified Party is an actual or potential party thereto, unless such settlement, compromise, consent or termination (a) includes an explicit and unconditional release of each Indemnified Party from any liabilities arising out of such claim, action or proceeding and (b) does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any Indemnified Party.

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Notwithstanding any other provision set forth in this Agreement, in no event shall any payments made by the Bank or the Holding Company pursuant to this Agreement exceed the amount permissible under applicable federal law, including, without limitation, Section 18(k) of the Federal Deposit Insurance Act and the regulations promulgated thereunder.

This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and can be altered only by written consent signed by the parties. This Agreement and any claim, controversy or dispute arising under or related to this Agreement shall be governed by and construed in accordance with the laws of the State of Illinois, without giving effect to the conflicts of laws principles thereof. The Company and Performance Trust irrevocably agree to waive trial by jury in any action, proceeding, claim or counterclaim brought by or on behalf of either party related to or arising out of this Agreement or the performance of services hereunder.

Each of the parties hereto irrevocably agrees that, except as otherwise set forth in this paragraph, any state or federal court sitting in the City of Chicago shall have exclusive jurisdiction to hear and determine any suit, action or proceeding and to settle any dispute arising out of or relating to this Agreement and, for such purposes, irrevocably submits to the jurisdiction of such courts. The Company hereby agrees that service of any process, summons, notice or document by hand delivery or registered mail addressed to the Company, shall be effective service of process for any suit, action or proceeding brought in any such court. The Company irrevocably and unconditionally waives any objection to the laying of venue of any such suit, action or proceeding brought in any such court and any claim that any such suit, action or proceeding has been brought in an inconvenient forum. The Company agrees that a final judgment in any such suit, action or proceeding brought in any such court shall be conclusive and binding upon the Company and may be enforced in any other court to whose jurisdiction the Company is or may in the future be subject, by suit upon judgment. The Company further agrees that nothing herein shall affect Performance Trust's right to effect service of process in any other manner permitted by law or to bring a suit, action or proceeding (including a proceeding for enforcement of a judgment) in any other court or jurisdiction in accordance with applicable law. This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and can be altered only by written consent signed by the parties.

If the Holding Company or the Bank enters into any agreement or arrangement with respect to, or effects, any proposed sale, exchange, dividend or other distribution or liquidation of all or substantially all of its assets in one or a series of transactions, the Bank or the Holding Company shall provide for the assumption of its obligations under this section by the purchaser or transferee of such assets or another party in substance and manner reasonably satisfactory to Performance Trust.

It is understood that the provisions herein relating to the payment of fees and expenses and those relating to governing law and submission to jurisdiction, and those contained under the captions "Reliance on Information Provided", "Confidentiality", "Limitations" and "Indemnification," will survive any termination of this Agreement.

*(Remainder of Page Intentionally Left Blank)*

 

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Please confirm that the foregoing correctly sets forth our agreement by signing and returning to Performance Trust the duplicate copy of this Agreement enclosed herewith.

---

| | | | |
|:---|:---|:---|:---|
| | | Very truly yours, | Very truly yours, |
| | | PERFORMANCE TRUST CAPITAL PARTNERS, LLC | PERFORMANCE TRUST CAPITAL PARTNERS, LLC |
| | | By: | /s/ R. Lee Burrows |
| | | Lee Burrows | Lee Burrows |
| | | Vice Chairman of Investment Banking | Vice Chairman of Investment Banking |
| Accepted and agreed to as of the date first above written: | Accepted and agreed to as of the date first above written: |  |  |
| **Mercer Savings Bank** | **Mercer Savings Bank** |  |  |
| By: | /s/ Alvin B. Parmiter |  |  |
| Barry Parmiter | Barry Parmiter |  |  |
| President & CEO | President & CEO |  |  |

---

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## Ex-2

**Exhibit 2**

**PLAN OF CONVERSION**

**OF**

**MERCER SAVINGS BANK**

**TABLE OF CONTENTS**

1. INTRODUCTION 1

2. DEFINITIONS 1

3. PROCEDURES FOR CONVERSION 7

4. APPLICATIONS AND APPROVALS 9

5. SALE OF SUBSCRIPTION SHARES 9

6. PURCHASE PRICE AND NUMBER OF SUBSCRIPTION SHARES 9

7. RETENTION OF OFFERING PROCEEDS BY THE HOLDING COMPANY 10

8. SUBSCRIPTION RIGHTS OF ELIGIBLE ACCOUNT HOLDERS (FIRST PRIORITY) 10

9. SUBSCRIPTION RIGHTS OF EMPLOYEE PLANS (SECOND PRIORITY) 11

10. SUBSCRIPTION RIGHTS OF SUPPLEMENTAL ELIGIBLE ACCOUNT HOLDERS (THIRD PRIORITY) 12

11. SUBSCRIPTION RIGHTS OF OTHER MEMBERS (FOURTH PRIORITY) 12

12. COMMUNITY OFFERING 13

13. SYNDICATED COMMUNITY OFFERING OR FIRM COMMITMENT UNDERWRITTEN OFFERING 13

14. LIMITATIONS ON PURCHASES 14

15. PAYMENT FOR SUBSCRIPTION SHARES 15

16. MANNER OF EXERCISING SUBSCRIPTION RIGHTS THROUGH ORDER FORMS 16

17. UNDELIVERED, DEFECTIVE OR LATE ORDER FORM; INSUFFICIENT PAYMENT 17

18. RESIDENTS OF FOREIGN COUNTRIES AND CERTAIN STATES 18

19. CONTRIBUTION TO THE FOUNDATION 18

20. ESTABLISHMENT OF LIQUIDATION ACCOUNT 19

21. VOTING RIGHTS OF STOCKHOLDERS 20

22. RESTRICTIONS ON RESALE OR SUBSEQUENT DISPOSITION 20

23. REQUIREMENTS FOR STOCK PURCHASES BY DIRECTORS AND OFFICERS FOLLOWING THE CONVERSION 21

24. TRANSFER OF DEPOSIT ACCOUNTS 21

25. REGISTRATION AND MARKETING 21

26. TAX RULINGS OR OPINIONS 21

27. STOCK BENEFIT PLANS AND EMPLOYMENT AGREEMENTS 22

28. RESTRICTIONS ON ACQUISITION OF BANK AND HOLDING COMPANY 22

29. PAYMENT OF DIVIDENDS AND REPURCHASE OF STOCK 23

30. CONSUMMATION OF CONVERSION AND EFFECTIVE DATE 23

31. EXPENSES OF CONVERSION 23

32. AMENDMENT OR TERMINATION OF PLAN 24

33. CONDITIONS TO CONVERSION 24

34. INTERPRETATION 24

(i) **AMENDED AND RESTATED PLAN OF CONVERSION**

**OF**

**MERCER SAVINGS BANK**

1. INTRODUCTION

This Plan of Conversion (the "Plan") provides for the conversion of Mercer Savings Bank, an Ohio state-chartered mutual bank (the "Bank"), into the capital stock form of organization. A new stock holding company (the "Holding Company") will be established as part of the Conversion and will issue Common Stock in connection with the Conversion. The purpose of the Conversion is to convert the Bank to the capital stock form of organization and to raise capital in the Offering. The Holding Company will offer its Common Stock in the Offering upon the terms and conditions set forth in this Plan. The subscription rights granted to Participants in the Subscription Offering are set forth in Sections 8 through 11 hereof. All sales of Common Stock in the Community Offering, the Syndicated Community Offering or the Firm Commitment Underwritten Offering will be at the sole discretion of the Boards of Directors of the Bank and the Holding Company. The Conversion will have no impact on depositors, borrowers or other customers of the Bank (other than as to voting and liquidation rights as set forth in this Plan). After the Conversion, the Bank's insured deposits will continue to be insured by the FDIC to the fullest extent provided by applicable law.

In furtherance of the Bank's commitment to its community, the Plan provides for a contribution of Holding Company Common Stock and/or cash, subject to regulatory limitations, to the Foundation. The funding of the Foundation is intended to enhance the Bank's existing community reinvestment activities by allowing the Bank's local communities to share in the expected growth and profitability of the Holding Company and the Bank over the long term.

This Plan has been approved by the Board of Directors of the Bank. This Plan must be approved by two-thirds of the total number of votes entitled to be cast by Voting Members and the establishment of the Foundation must be approved by a majority of the total number of votes entitled to be cast by Voting Members of the Bank at a Meeting of Members to be called for that purpose. The Bank Regulators must approve this Plan and the transactions contemplated by it before it is presented to Voting Members for their approval. In addition, the Holding Company will make any and all filings in a timely manner with the Federal Reserve and the SEC to obtain any requisite regulatory approvals to complete the Conversion.

2. DEFINITIONS

For the purposes of this Plan, the following terms have the following respective meanings:

**Account Holder** – Any Person holding a Deposit Account in the Bank.

**Acting in Concert** – The term Acting in Concert means (i) knowing participation in a joint activity or interdependent conscious parallel action towards a common goal whether or not pursuant to an express agreement; or (ii) a combination or pooling of voting or other interests in the securities of an issuer for a common purpose pursuant to any contract, understanding, relationship, agreement or other arrangement, whether written or otherwise. A person or company that acts in concert with another person or company ("other party") shall also be deemed to be acting in concert with any person or company that is also acting in concert with that other party, except that any Tax-Qualified Employee Stock Benefit Plan will not be deemed to be acting in concert with its trustee or a Person who serves in a similar capacity solely for the purpose of determining whether stock held by the trustee and stock held by the plan will be aggregated.

**Affiliate** – When applied to a specified Person, includes any Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such specified Person.

**Appraised Value Range** – The range of the estimated consolidated pro forma market value of the Holding Company, which shall also be equal to the estimated pro forma market value of the total number of Subscription Shares to be issued in the Conversion, as determined by the Independent Appraiser before the Subscription Offering and as it may be amended from time to time thereafter. The maximum and minimum of the Appraised Value Range may vary as much as 15% above and 15% below, respectively, the midpoint of the Appraised Value Range. The maximum of the Appraised Value Range may be increased by up to 15% after the commencement of the Subscription Offering to reflect changes in market or financial conditions or demand for the Common Stock.

**Associate** – When used to indicate a relationship with any Person, means (i) any corporation or organization (other than the Holding Company, the Bank or a majority-owned subsidiary of the Bank) if the Person is a senior officer or partner or beneficially owns, directly or indirectly, 10% or more of any class of equity securities of the corporation or organization, (ii) any trust or other estate, if the Person has a substantial beneficial interest in the trust or estate or is a trustee or fiduciary of the trust or estate, except that for the purposes of this Plan relating to subscriptions in the Offering and the sale of Subscription Shares following the Conversion, a Person who has a substantial beneficial interest in any Non-Tax-Qualified Employee Stock Benefit Plan or any Tax-Qualified Employee Stock Benefit Plan, or who is a trustee or fiduciary of such plan, is not an associate of such plan, and except that for purposes of aggregating total shares that may be held by Officers and Directors, the term "Associate" does not include any Tax-Qualified Employee Stock Benefit Plan, and (iii) any Person who is related by blood or marriage to such Person and who (A) lives in the same home as such Person or (B) is a Director or Officer of the Bank, the Holding Company or a subsidiary of the Bank or the Holding Company.

**Bank** – Mercer Savings Bank, Celina, Ohio.

**Bank Regulators** – The ODFI, the FDIC and, where applicable, the Federal Reserve.

**Code** – The Internal Revenue Code of 1986, as amended.

**Common Stock** – The common stock, par value $0.01 per share, of the Holding Company.

**Community** – Mercer and Darke Counties in Ohio and Adams and Jay Counties in Indiana.

**Community Offering** – The offering for sale to certain members of the general public directly by the Holding Company of Subscription Shares not subscribed for in the Subscription Offering. The Community Offering may occur concurrently with the Subscription Offering and any Syndicated Community Offering, or upon conclusion of the Subscription Offering.

**Control** – (including the terms "controlling," "controlled by," and "under common control with") means the direct or indirect power to direct or exercise a controlling influence over the management or policies of a Person, whether through the ownership of voting securities, by contract or otherwise as described in 12 C.F.R. §5.50.

**Conversion** – The conversion of the Bank to stock form pursuant to this Plan, and all steps incident or necessary thereto including the Offering.

**Conversion Applications** – Applications for approval to effect the Conversion, in such forms as may be prescribed by the FDIC and the ODFI, which the Bank will file with the FDIC and the ODFI, respectively.

**Deposit Account** – Any withdrawable account, including, without limitation, savings accounts, time accounts, demand accounts, NOW accounts, money market accounts, certificate accounts and passbook accounts.

**Director** – A member of the Board of Directors of the Bank or the Holding Company, as appropriate in the context.

**Eligible Account Holder** – Any Person holding a Qualifying Deposit as of the close of business on the Eligibility Record Date, for purposes of determining subscription rights and establishing subaccount balances in the Liquidation Account.

**Eligibility Record Date** – The date for determining Eligible Account Holders of the Bank, which is February 28, 2022.

**Employees** – All Persons who are employed by the Bank or the Holding Company.

**Employee Plans** – Any one or more Tax-Qualified Employee Stock Benefit Plans of the Bank or the Holding Company, including any ESOP and 401(k) Plan.

**ESOP** – The Bank's Employee Stock Ownership Plan and related trust.

**FDIC** – The Federal Deposit Insurance Corporation.

**Federal Reserve** – The Board of Governors of the Federal Reserve System, including the Federal Reserve Bank of Cleveland.

**Firm Commitment Underwritten Offering** – The offering, at the sole discretion of the Holding Company, of Subscription Shares not subscribed for in the Subscription Offering and any Community Offering, to members of the general public through one or more underwriters. A Firm Commitment Underwritten Offering may occur following the Subscription Offering and the Community Offering as an alternative to a Syndicated Community Offering.

**Foundation**: A new charitable foundation intended to qualify as an exempt organization under Section 501(c)(3) of the Code that will receive Foundation Shares and/or cash in connection with the Conversion.

**Foundation Shares**: Shares of Common Stock issued to the Foundation in connection with the Conversion.

**Holding Company** – The corporation formed for the purpose of acquiring all of the outstanding shares of capital stock of the Bank to be issued in connection with the Conversion, which shall be incorporated in such State as shall be designated by the Board of Directors. Shares of Common Stock of the Holding Company will be issued in the Conversion to Participants, and possibly others, in the Offering.

**Holding Company Application** – The application on such form as may be prescribed by the Federal Reserve, which will be filed by the Holding Company with the Federal Reserve in connection with the Conversion and the formation of the Holding Company.

**Independent Appraiser** – The independent appraiser retained by the Holding Company and the Bank to prepare an appraisal of the pro forma market value of the Subscription Shares.

**Liquidation Account** – The account established by the Bank representing the liquidation interests received by Eligible Account Holders and Supplemental Eligible Account Holders in connection with the Conversion in exchange for their interests in the Bank immediately before the Conversion.

**Meeting of Members** – The special meeting or annual meeting of Voting Members, and any adjournments thereof, held to consider and vote upon this Plan.

**Member** – Any Person that qualifies as a member of the Bank pursuant to its articles of incorporation, constitution and bylaws.

**ODFI** – The Ohio Division of Financial Institutions, including the Superintendent of the Division of Financial Institutions.

**Offering** – The offering, sale and issuance, pursuant to this Plan, of Common Stock in the Subscription Offering, Community Offering, Syndicated Community Offering or Firm Commitment Underwritten Offering, as the case may be.

**Offering Range** – The range of the number of shares of Common Stock offered for sale in the Offering. The Offering Range shall equal the quotient of the Appraised Value Range divided by the Subscription Price.

**Officer** – The chief executive officer, president, any vice president (but not an assistant vice president, second vice president, or other vice president having authority similar to an assistant or second vice president), the secretary, the treasurer, the comptroller, and any other person performing similar functions with respect to any organization whether incorporated or unincorporated. The term Officer also includes the Chairman of the Board of Directors if the Chairman is authorized by the articles of incorporation, constitution or bylaws of the organization to participate in its operating management or if the Chairman in fact participates in such management.

**Order Form** – Any form (together with any cover letter and acknowledgment) sent to any Participant or other Person containing, among other things, a description of the alternatives available to such Person under this Plan and by which any such Person may make elections regarding subscriptions for Subscription Shares.

**Other Member** – Any Member as of the close of business on the Voting Record Date who is not an Eligible Account Holder or a Supplemental Eligible Account Holder.

**Participant** – Any Eligible Account Holder, Employee Plan, Supplemental Eligible Account Holder or Other Member.

**Person** – An individual, a corporation, a partnership, an association, a joint-stock company, a limited liability company, a trust, an unincorporated organization, or a government or political subdivision of a government.

**Plan** – This Plan of Conversion, as it exists on the date hereof and as it may hereafter be amended in accordance with its terms.

**Prospectus** – The one or more documents used in offering for sale the Subscription Shares.

**Qualifying Deposit** – The aggregate balance of all Deposit Accounts in the Bank of (i) an Eligible Account Holder as of the close of business on the Eligibility Record Date, provided the aggregate balance is not less than $50.00, or (ii) a Supplemental Eligible Account Holder as of the close of business on the Supplemental Eligibility Record Date, provided the aggregate balance is not less than $50.00.

**Resident** – Any Person who occupies a dwelling within the Community, has a present intent to remain within the Community for a period of time, and manifests the genuineness of that intent by establishing an ongoing physical presence within the Community together with an indication that such presence within the Community is something other than merely transitory in nature. For a corporation or other business entity to be a Resident, the principal place of business or headquarters of such entity must be in the Community. To the extent a Person is a personal benefit plan, the circumstances of the beneficiary shall apply with respect to this definition. In the case of all other benefit plans, circumstances of the trustee shall be examined for purposes of this definition. The Bank may utilize deposit or loan records or such other evidence provided to it to make a determination as to whether a Person is a resident of the Community. In all cases, however, such a determination shall be in the sole discretion of the Bank. A Person must be a "Resident" for purposes of determining whether such Person "resides" in the Community as such term is used in this Plan.

**SEC** – The U.S. Securities and Exchange Commission.

**Subscription Offering** – The offering of Subscription Shares for sale to Participants.

**Subscription Price** – The price per Subscription Share to be paid by Participants and others in the Offering. The Subscription Price will be determined by the Board of Directors of the Holding Company and fixed before the commencement of the Subscription Offering. The Subscription Price shall be between $5.00 per share and $50.00 per share.

**Subscription Shares** – Shares of Common Stock offered for sale in the Offering.

**Supplemental Eligible Account Holder** – Any Person, other than Directors and Officers of the Bank and the Holding Company and their Associates (unless the applicable Bank Regulators grant a waiver permitting a Director or Officer to be included), holding a Qualifying Deposit as of the close of business on the Supplemental Eligibility Record Date, who is not an Eligible Account Holder.

**Supplemental Eligibility Record Date** – The date for determining Supplemental Eligible Account Holders, which shall be the last day of the calendar quarter preceding approval of the Conversion by the Bank Regulators. The Supplemental Eligibility Record Date will only occur if Bank Regulators have not approved the Conversion within 15 months after the Eligibility Record Date.

**Syndicated Community Offering** – The offering, at the sole discretion of the Holding Company, of Subscription Shares not subscribed for in the Subscription Offering and the Community Offering, to members of the general public through a syndicate of broker-dealers. The Syndicated Community Offering may occur concurrently with the Subscription Offering and any Community Offering, or upon conclusion of the Subscription Offering and any Community Offering.

**Tax-Qualified Employee Stock Benefit Plan** – Any defined benefit plan or defined contribution plan, such as an employee stock ownership plan, stock bonus plan, profit-sharing plan or other plan, which, with its related trust, meets the requirements to be "qualified" under Section 401 of the Code. The Bank may make scheduled discretionary contributions to a tax-qualified employee stock benefit plan, *provided* such contributions do not cause the Bank to fail to meet its regulatory capital requirements. A "Non-Tax-Qualified Employee Stock Benefit Plan" is any defined benefit plan or defined contribution plan that is not so qualified.

**Voting Member** – Any Person who at the close of business on the Voting Record Date is entitled to vote as a Member of the Bank pursuant to its articles of incorporation, constitution and bylaws.

**Voting Record Date** – The date fixed by the Board of Directors of the Bank for determining eligibility to vote at the Meeting of Members.

3. PROCEDURES FOR CONVERSION

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. After approval of this Plan by the Bank's Board of Directors, this Plan and the transactions contemplated hereby, together with all other requisite material, shall be submitted to the Bank Regulators for approval. Notice of the adoption of this Plan by the Bank's Board of Directors shall be published in a newspaper having general circulation in each community in which an office of the Bank is located, and copies of this Plan will be made available at each office of the Bank for inspection by Members. The Bank also shall publish any required notices of the filing of the Conversion Applications with the FDIC and the ODFI and of the filing of the Holding Company Application with the Federal Reserve.

Promptly following approval by the Bank Regulators, this Plan and the transactions contemplated by it will be submitted to a vote of the Voting Members at the Meeting of Members. The Bank will mail to all Voting Members, at their address appearing on the records of the Bank as of the close of business on the Voting Record Date, a proxy statement in either long or summary form describing this Plan. The Holding Company also will mail to all Participants a Prospectus and Order Form for the purchase of Subscription Shares, subject to other provisions of this Plan. In addition, all Participants will receive, or will be given the opportunity to request by telephone or by letter addressed to the Bank's Secretary, a copy of this Plan. Upon approval of this Plan by two-thirds of the total number of votes entitled to be cast by Voting Members, the Holding Company and the Bank will take all other necessary steps pursuant to applicable laws and regulations to consummate the Conversion, including amendment of the Bank's articles of incorporation, constitution and bylaws. The Conversion must be completed within 24 months of the approval of this Plan by Voting Members, unless a longer time period is permitted by governing laws and regulations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. The period for the Subscription Offering will be not less than 20 days nor more than 45 days from the date Participants are first mailed a Prospectus and Order Form, unless extended. Any shares of Common Stock for which subscriptions have not been received in the Subscription Offering may be issued in a Community Offering, a Syndicated Community Offering or a Firm Commitment Underwritten Offering, or in any other manner permitted by the Bank Regulators and the SEC. All sales of shares of Common Stock must be completed within 45 days after the last day of the Subscription Offering, unless the offering period is extended by the Holding Company with the approval of the Bank Regulators. No single extension of more than 90 days will be granted.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;C. The Conversion will be effected as follows, or in any other manner that is consistent with the purposes of this Plan and applicable laws and regulations. Each of the steps set forth below shall be deemed to occur in such order as is necessary to consummate the Conversion pursuant to this Plan, the intent of the Board of Directors of the Holding Company and the Board of Directors of the Bank, and applicable federal and state regulations and policy.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) The Bank will amend and restate its Ohio articles of incorporation, constitution and bylaws to authorize
the issuance of capital stock;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) The Holding Company will purchase all of the capital stock issued by the Bank in connection with its conversion
from mutual to stock form, for at least 50% of the net proceeds of the Offering; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) The Holding Company will issue the Common Stock sold in the Offering as provided in this Plan. The Holding
Company shall have registered the issuance of the Subscription Shares and the Foundation Shares with the SEC and any appropriate state
securities authorities.

Approval of this Plan by Voting Members shall constitute approval of each of the transactions necessary to implement this Plan, including the adoption of the Bank's amended and restated articles of incorporation, constitution and bylaws.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;D. The Board of Directors of the Bank may determine for any reason at any time before the issuance of the Subscription Shares not to utilize a holding company form of organization in the Conversion. If the Board of Directors determines not to complete the Conversion utilizing a holding company form of organization, the common stock of the Bank will be issued and sold in accordance with this Plan. In such case, the Holding Company's registration statement will be withdrawn from the SEC, the Holding Company's Holding Company Application will be withdrawn from the Federal Reserve, and the Bank will take steps necessary to complete the Conversion, including filing any necessary documents with the Bank Regulators and any other applicable state or federal regulatory agencies and will issue and sell the Subscription Shares in accordance with this Plan. In such event, any subscriptions or orders received for Subscription Shares of the Holding Company shall be deemed to be subscriptions or orders for common stock of the Bank, and the Bank shall take such steps as permitted or required by the Bank Regulators and any other applicable state or federal regulatory agencies.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;E. Upon completion of the Conversion, the legal existence of the Bank shall not terminate but the Bank (in stock form) shall be a continuation of the entity of the Bank (in mutual form) and all property of the Bank (in mutual form), including its right, title and interest in and to all property of whatever kind and nature, whether real, personal, or mixed, and things, and choses in action, and every right, privilege, interest and asset of every conceivable value or benefit then existing or pertaining to it, or which would inure to it, immediately by operation of law and without the necessity of any conveyance or transfer and without any further act or deed shall vest in the Bank (in stock form). The Bank (in stock form) shall have, hold, and enjoy the same in its own right as fully and to the same extent as the same was possessed, held and enjoyed by the Bank (in mutual form). The Bank (in stock form) at the time and the taking effect of the Conversion shall continue to have and succeed to all the rights, obligations and relations of the Bank (in mutual form). All pending actions and other judicial or administrative proceedings to which the Bank was a party shall not be discontinued by reason of the Conversion, but may be prosecuted to final judgment or order in the same manner as if the Conversion had not been made and the Bank (in stock form) resulting from the Conversion may continue the actions in its name notwithstanding the Conversion. Upon completion of the Conversion, each Person having a Deposit Account at the Bank before the Conversion will continue to have a Deposit Account, without further payment therefor, in the same amount and subject to the same terms and conditions (except for voting and liquidation rights) as in effect before the Conversion. All of the Bank's insured Deposit Accounts will continue to be insured by the FDIC to the extent provided by applicable law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;F. The home office and the branch offices of the Bank shall be unaffected by the Conversion. The executive offices of the Holding Company shall be located at the main office of the Bank.

4. APPLICATIONS AND APPROVALS

The Boards of Directors of the Holding Company and the Bank will take all necessary steps to convert the Bank to stock form, form the Holding Company, and complete the Conversion. The Bank shall file the Conversion Applications with the FDIC and the ODFI, and the Holding Company shall file the Holding Company Application with the Federal Reserve and a registration statement with the SEC. The Bank and Holding Company intend to make any additional filings necessary to obtain all approvals required to complete the Conversion.

In addition, the Boards of Directors of the Holding Company and the Bank intend to take all necessary steps to establish the Foundation and to fund the Foundation in the manner set forth in Section 19.

5. SALE OF SUBSCRIPTION SHARES

The Subscription Shares will be offered for sale simultaneously in the Subscription Offering to the Participants in the respective priorities set forth in this Plan. The Subscription Offering may begin as early as the mailing of the Prospectus and the Proxy Statement for the Meeting of Members. The Common Stock will not be insured by the FDIC or any government agency. The Bank will not extend credit to any Person to purchase shares of Common Stock.

Any shares of Common Stock for which subscriptions have not been received in the Subscription Offering may be issued in the Community Offering. The Subscription Offering may begin before the Meeting of Members and, in that event, the Community Offering also may begin before the Meeting of Members. The sale of Common Stock offered for sale before the Meeting of Members, however, is subject to the approval of this Plan by Voting Members.

If feasible, any shares of Common Stock remaining available for sale after the Subscription Offering, and the Community Offering, if conducted, will be sold in a Syndicated Community Offering or a Firm Commitment Underwritten Offering, or in any other manner approved by the Bank Regulators that will achieve the widest distribution of the Common Stock. The issuance of Common Stock in the Subscription Offering and any Community Offering will be consummated simultaneously on the date of the sale of Common Stock in any Syndicated Community Offering or Firm Commitment Underwritten Offering, and only if the required minimum number of shares of Common Stock has been issued.

6. PURCHASE PRICE AND NUMBER OF SUBSCRIPTION SHARES

The total number of shares, or range of number, of Subscription Shares to be offered for sale in the Offering will be determined jointly by the Boards of Directors of the Bank and the Holding Company immediately before the commencement of the Subscription Offering, and will be based on the Appraised Value Range and the Subscription Price. The Offering Range will equal the quotient of the Appraised Value Range divided by the Subscription Price. The estimated pro forma consolidated market value of the Holding Company will be subject to adjustment within the Appraised Value Range if necessitated by market or financial conditions, with the receipt of any required approvals of the Bank Regulators, and the maximum of the Appraised Value Range may be increased by up to 15% after the commencement of the Subscription Offering to reflect changes in market and financial conditions or demand for the shares.

If the product of the Subscription Price multiplied by the number of shares of Common Stock to be sold in the Offering is below the minimum of the Appraised Value Range, or materially above the maximum of the Appraised Value Range, a resolicitation of subscribers may be required, *provided* that up to a 15% increase above the maximum of the Appraised Value Range shall be deemed not material and thus shall not require a resolicitation. Any such resolicitation shall be effected in such manner and within such time as the Bank and the Holding Company shall establish, provided that all required regulatory approvals are obtained.

Notwithstanding the foregoing, Subscription Shares will not be issued unless, before the consummation of the Offering, the Independent Appraiser confirms to the Bank, the Holding Company and the Bank Regulators, that, to the best knowledge of the Independent Appraiser, nothing of a material nature has occurred which, taking into account all relevant factors, would cause the Independent Appraiser to conclude that the number of shares of Common Stock to be sold in the Offering multiplied by the Subscription Price is incompatible with its estimate of the aggregate consolidated pro forma market value of the Holding Company. If such confirmation is not received, the Holding Company may cancel the Offering, extend the Offering and establish a new Subscription Price and/or Appraised Value Range, hold a new Offering, or take such other action as the Bank Regulators may permit.

The Common Stock to be issued in the Offering shall be fully paid and non-assessable.

7. RETENTION OF OFFERING PROCEEDS BY THE HOLDING COMPANY

The Holding Company may retain up to 50% of the net proceeds of the Offering. The Offering proceeds will provide additional capital to the Holding Company and the Bank for future growth of the Bank's assets, products and services in a highly competitive and regulated financial services environment, and would facilitate expansion through acquisitions of financial service organizations, diversification into other related businesses and for other business and investment purposes, including the possible payment of dividends and possible future repurchases of the Common Stock as permitted by applicable federal and state regulations and policy. Following the Conversion, the Bank may distribute additional capital to the Holding Company from time to time, subject to applicable regulations governing capital distributions.

8. SUBSCRIPTION RIGHTS OF ELIGIBLE ACCOUNT HOLDERS (FIRST PRIORITY)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. Each Eligible Account Holder shall have nontransferable subscription rights to subscribe for in the Subscription Offering up to the greater of 20,000 shares ($200,000) of Common Stock, 0.10% of the total number of shares of Common Stock issued in the Offering, or fifteen times the product (rounded down to the next whole number) obtained by multiplying the number of Subscription Shares offered in the Offering by a fraction of which the numerator is the amount of the Eligible Account Holder's Qualifying Deposit and the denominator is the total amount of Qualifying Deposits of all Eligible Account Holders, in each case on the Eligibility Record Date, subject to the provisions of Section 14.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. If Eligible Account Holders exercise subscription rights for a number of Subscription Shares in excess of the total number of such shares eligible for subscription, the Subscription Shares shall be allocated among the subscribing Eligible Account Holders so as to permit each subscribing Eligible Account Holder to purchase a number of shares sufficient to make their total allocation of Subscription Shares equal to the lesser of 100 shares or the number of shares for which such Eligible Account Holder has subscribed. Any remaining shares will be allocated among the subscribing Eligible Account Holders whose subscriptions remain unsatisfied in the proportion that the amount of the Qualifying Deposit of each Eligible Account Holder whose subscription remains unsatisfied bears to the total amount of the Qualifying Deposits of all Eligible Account Holders whose subscriptions remain unsatisfied. If the amount so allocated exceeds the amount subscribed for by any one or more Eligible Account Holders, the excess shall be reallocated (one or more times as necessary) among those Eligible Account Holders whose subscriptions are still not fully satisfied on the same principle until all available shares have been allocated.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;C. Subscription rights as Eligible Account Holders received by Directors and Officers and their Associates that are based on increased deposits made by such persons during the 12 months preceding the Eligibility Record Date shall be subordinated to the subscription rights of all other Eligible Account Holders, except as permitted by the Bank Regulators.

9. SUBSCRIPTION RIGHTS OF EMPLOYEE PLANS (SECOND PRIORITY)

The Employee Plans of the Holding Company and the Bank shall have subscription rights to purchase in the aggregate up to 10% of the shares of Common Stock issued and outstanding as of the consummation of the Conversion, including any Subscription Shares to be issued as a result of an increase in the maximum of the Offering Range after commencement of the Subscription Offering and before the completion of the Conversion and the Foundation Shares contributed to the Foundation. Consistent with applicable laws and regulations and practices and policies, the Employee Plans may use funds contributed by the Holding Company or the Bank and/or borrowed from an independent financial institution to exercise such subscription rights, and the Holding Company and the Bank may make scheduled discretionary contributions thereto, provided that such contributions do not cause the Holding Company or the Bank to fail to meet any applicable regulatory capital requirements. The Employee Plans shall not be deemed to be Associates or Affiliates of or Persons Acting in Concert with any Director or Officer of the Holding Company or the Bank. Alternatively, if permitted by the Bank Regulators, the Employee Plans may purchase all or a portion of such shares in the open market after the Conversion.

10. SUBSCRIPTION RIGHTS OF SUPPLEMENTAL ELIGIBLE ACCOUNT HOLDERS (THIRD PRIORITY)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. Each Supplemental Eligible Account Holder shall have nontransferable subscription rights to subscribe for in the Subscription Offering up to the greater of 20,000 shares ($200,000), 0.10% of the total number of shares of Common Stock issued in the Offering, or fifteen times the product (rounded down to the next whole number) obtained by multiplying the number of Subscription Shares offered in the Offering by a fraction of which the numerator is the amount of the Supplemental Eligible Account Holder's Qualifying Deposit and the denominator is the total amount of Qualifying Deposits of all Supplemental Eligible Account Holders, in each case on the Supplemental Eligibility Record Date, subject to the availability of sufficient shares after filling in full all subscription orders of the Eligible Account Holders and Employee Plans and to the purchase limitations specified in Section 14.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. If Supplemental Eligible Account Holders exercise subscription rights for a number of Subscription Shares in excess of the total number of such shares eligible for subscription, the Subscription Shares shall be allocated among the subscribing Supplemental Eligible Account Holders so as to permit each such subscribing Supplemental Eligible Account Holder, to the extent possible, to purchase a number of shares sufficient to make their total allocation of Subscription Shares equal to the lesser of 100 shares or the number of shares for which each such Supplemental Eligible Account Holder has subscribed. Any remaining shares will be allocated among the subscribing Supplemental Eligible Account Holders whose subscriptions remain unsatisfied in the proportion that the amount of the Qualifying Deposit of each such Supplemental Eligible Account Holder bears to the total amount of the Qualifying Deposits of all Supplemental Eligible Account Holders whose subscriptions remain unsatisfied. If the amount so allocated exceeds the amount subscribed for by any one or more Supplemental Eligible Account Holders, the excess shall be reallocated (one or more times as necessary) among those Supplemental Eligible Account Holders whose subscriptions are still not fully satisfied on the same principle until all available shares have been allocated.

11. SUBSCRIPTION RIGHTS OF OTHER MEMBERS (FOURTH PRIORITY)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. Each Other Member shall have nontransferable subscription rights to subscribe for in the Subscription Offering up to the greater of 20,000 shares ($200,000) of Common Stock or 0.10% of the total number of shares of Common Stock issued in the Offering, subject to the availability of sufficient shares after filling in full all subscription orders of Eligible Account Holders, Employee Plans and Supplemental Eligible Account Holders and to the purchase limitations specified in Section 14.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. If Other Members subscribe for a number of Subscription Shares which, when added to the Subscription Shares subscribed for by the Eligible Account Holders, Employee Plans and Supplemental Eligible Account Holders, is in excess of the total number of Subscription Shares to be issued, the available shares will be allocated to Other Members so as to permit each such subscribing Other Member, to the extent possible, to purchase a number of shares sufficient to make their total allocation of Subscription Shares equal to the lesser of 100 shares or the number of shares for which each such Other Member has subscribed. Any remaining shares will be allocated among the subscribing Other Members whose subscriptions remain unsatisfied in the proportion that the amount of the subscription of each such Other Member bears to the total amount of the subscriptions of all Other Members whose subscriptions remain unsatisfied.

12. COMMUNITY OFFERING

If subscriptions are not received for all Subscription Shares offered for sale in the Subscription Offering, shares for which subscriptions have not been received may be offered for sale in the Community Offering through a direct community marketing program that may use a broker, dealer, consultant or investment banking firm experienced and expert in the sale of savings institutions securities. Such entities may be compensated on a fixed fee basis or on a commission basis, or a combination thereof. In the event orders for Common Stock in the Community Offering exceed the number of shares available for sale, shares may be allocated (to the extent shares remain available) first to cover orders of natural persons (including trusts of natural persons) residing in the Community, and thereafter to satisfy orders of other members of the general public, so that each Person in such category of the Community Offering may receive, to the extent possible, the lesser of 100 shares or the number of shares they ordered. In addition, orders received for shares in the Community Offering from natural persons (including trusts of natural persons) residing in the Community will be filled up to a maximum of two percent (2%) of the shares sold in the Offering, and thereafter any remaining shares will be allocated to Persons in such category of the Community Offering on an equal number of shares basis per order.

The Holding Company shall use its best efforts consistent with this Plan to distribute Common Stock sold in the Community Offering in such a manner as to promote the widest distribution practicable of such stock. The Holding Company reserves the right to reject any or all orders, in whole or in part, that are received in the Community Offering. Any Person may purchase up to 20,000 shares ($200,000) of Common Stock in the Community Offering, subject to the purchase limitations specified in Section 14.

13. SYNDICATED COMMUNITY OFFERING OR FIRM COMMITMENT UNDERWRITTEN OFFERING

If feasible, the Board of Directors may determine to offer Subscription Shares not sold in the Subscription Offering or the Community Offering, if any, in a Syndicated Community Offering, subject to such terms, conditions and procedures as may be determined by the Holding Company, in a manner that will achieve the widest distribution of the Common Stock, subject to the right of the Holding Company to accept or reject in whole or in part any orders in the Syndicated Community Offering. In the Syndicated Community Offering, any Person may purchase up to 20,000 shares ($200,000) of Common Stock, subject to the purchase limitations specified in Section 14. Unless otherwise permitted by the Bank Regulators, orders received for shares in a Syndicated Community Offering will first be filled up to a maximum of two percent (2%) of the shares sold in the Offering, and thereafter any remaining shares will be allocated on an equal number of shares basis per order. Provided that the Subscription Offering has begun, the Holding Company may begin the Syndicated Community Offering at any time (including as soon as practicable after the termination of the Subscription Offering and any Community Offering), *provided* that the completion of the offer and sale of the Common Stock will be conditioned upon the approval of this Plan by Voting Members.

Alternatively, if feasible, the Board of Directors may determine to offer Subscription Shares not sold in the Subscription Offering and any Community Offering for sale in a Firm Commitment Underwritten Offering subject to such terms, conditions and procedures as may be determined by the Holding Company, subject to the right of the Holding Company to accept or reject in whole or in part any orders in the Firm Commitment Underwritten Offering. Provided the Subscription Offering has begun, the Holding Company may begin the Firm Commitment Underwritten Offering at any time.

If, for any reason, a Syndicated Community Offering or Firm Commitment Underwritten Offering of shares of Common Stock not sold in the Subscription and Community Offerings cannot be effected, or if any insignificant residue of shares of Common Stock is not sold in the Subscription and Community Offerings or in a Syndicated Community Offering or Firm Commitment Underwritten Offering, the Holding Company, if possible, will make other arrangements for the disposition of unsubscribed shares aggregating at least the minimum of the Offering Range. Such other purchase arrangements will be subject to receipt of any required approval of the Bank Regulators.

14. LIMITATIONS ON PURCHASES

The following limitations shall apply to all purchases and issuances of shares of Subscription Shares:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. The maximum number of shares of Common Stock that may be subscribed for or purchased in all categories in the Offering by any Person or Participant together with any Associate or group of Persons Acting in Concert ("In Concert Group") is the lesser of 40,000 shares ($400,000) or 5% of the Subscription Shares sold, except that the Employee Plans may subscribe for up to 10% of the Subscription Shares sold (including shares issued in the event of an increase in the maximum of the Offering Range of 15%) and contributed to the Foundation. If the number of shares of Common Stock otherwise allocable pursuant to Sections 8 through 13, inclusive, would be in excess of the maximum number of shares permitted to be allocated to any In Concert Group as set forth in this section, the number of shares of Common Stock allocated to each Person that makes up such In Concert Group shall first be reduced to the lowest limitation applicable to each such Person and then the number of shares of Common Stock allocated to each such Person shall be reduced until the aggregate allocation to the In Concert Group complies with the limits of this Section 14. The method of reducing the allocation of each Person in any In Concert Group shall be determined by the Holding Company in its sole discretion.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. The maximum number of shares of Common Stock that may be issued to or purchased in all categories of the Offering by Officers and Directors and their Associates in the aggregate, shall not exceed 33% of the shares of Common Stock sold in the Offering and contributed to the Foundation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;C. A minimum of 25 shares of Common Stock must be purchased by each Person purchasing shares in the Offering to the extent those shares are available; *provided, however*, that in the event the minimum number of shares of Common Stock purchased times the Subscription Price exceeds $500, then such minimum purchase requirement shall be reduced to such number of shares which when multiplied by the price per share shall not exceed $500, as determined by the Board.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;D. Depending upon market or financial conditions, the Board of Directors of the Holding Company, with the receipt of any required approvals of the Bank Regulators and without further approval of Voting Members, may decrease or increase any of the purchase limitations in this Plan, *provided* that the maximum purchase limitations may not be increased to a percentage in excess of 5.0% of the shares sold in the Offering, except as provided below. If the Holding Company increases the maximum purchase limitation(s), the Holding Company is only required to resolicit Persons who subscribed for the maximum purchase amount in the Subscription Offering and who indicated a desire to be resolicited on the Order Form. In the event of such a resolicitation, the Holding Company shall have the right, in its sole discretion, to require such persons to supply immediately available funds for the purchase of additional shares of Common Stock. Such persons will be prohibited from paying with a personal check, but the Holding Company may allow payment by wire transfer. If a maximum purchase limitation is increased to 5.0% of the shares sold in the Offering, such limitation may be further increased to 9.99% of the shares of Common Stock sold in the Offering; *provided*, that orders for Common Stock exceeding 5.0% of the shares of Common Stock sold in the Offering shall not exceed in the aggregate 10.0% of the total shares of Common Stock sold in the Offering. Whether to fill any requests to purchase additional Subscription Stock in the event that the purchase limitation is so increased will be determined by the Board of Directors of the Holding Company in its sole discretion.

For purposes of this Section 14, (i) Directors, Officers and employees of the Bank and the Holding Company or any of their subsidiaries shall not be deemed to be Associates or a group affiliated with each other or otherwise Acting in Concert solely as a result of their capacities as such, (ii) shares purchased by Tax-Qualified Employee Stock Benefit Plans shall not be attributable to the individual trustees or beneficiaries of any such plan for purposes of determining compliance with the limitations set forth in paragraphs A. and B. of this Section 14, and (iii) shares purchased by a Tax-Qualified Employee Stock Benefit Plan pursuant to instructions of an individual in an account in such plan in which the individual has the right to direct the investment, including any plan of the Bank qualified under Section 401(k) of the Code, shall be aggregated and included in that individual's purchases and not attributed to the Tax-Qualified Employee Stock Benefit Plan.

Each Person purchasing Common Stock in the Offering shall be deemed to confirm that such purchase does not conflict with the above purchase limitations contained in this Plan.

15. PAYMENT FOR SUBSCRIPTION SHARES

All payments for Common Stock subscribed for in the Subscription Offering and Community Offering must be delivered in full to the Bank, the Holding Company or an agent of the Bank or the Holding Company, as described in the Order Form, together with a properly completed and executed Order Form, on or before the expiration date of the Offering; *provided, however*, that if the Employee Plans subscribe for shares in the Subscription Offering, then the Employee Plans shall not be required to pay for the shares of Common Stock at the time they subscribe for them but rather may pay for such shares of Common Stock at the Subscription Price upon consummation of the Offering. Subscription funds will be held in a segregated account at the Bank.

Except as set forth in Section 14.D., payment for Common Stock subscribed for in the Subscription Offering and any Community Offering shall be made by cash, personal check, money order or bank draft. Alternatively, subscribers in the Subscription and Community Offerings may pay for the shares for which they have subscribed by authorizing the Bank on the Order Form to make a withdrawal from designated types of Deposit Accounts at the Bank in an amount equal to the aggregate Subscription Price of such shares. Such authorized withdrawal shall be without penalty as to premature withdrawal. If the authorized withdrawal is from a certificate account, and the remaining balance does not meet the applicable minimum balance requirement, the certificate shall be canceled at the time of withdrawal, without penalty, and the remaining balance will earn interest at the passbook rate. Funds for which a withdrawal is authorized will remain in the subscriber's Deposit Account and will continue to earn interest therein, but may not be used by the subscriber during the Subscription and Community Offerings. Thereafter, the withdrawal will be given effect only to the extent necessary to satisfy the subscription (to the extent it can be filled) at the Subscription Price per share. Interest will continue to be earned on any amounts authorized for withdrawal until such withdrawal is given effect. Interest on funds received by cash, personal check, bank draft or money order will be paid by the Bank at not less than the passbook rate. Such interest will be paid from the date payment is processed by the Bank until consummation or termination of the Offering. If for any reason the Offering is not consummated, all payments made by subscribers in the Subscription and Community Offerings will be refunded to them with interest. In case of amounts authorized for withdrawal from Deposit Accounts, refunds will be made by canceling the authorization for withdrawal. The Bank is prohibited by regulation from making any loans or granting any lines of credit for the purchase of stock in the Offering, and therefore, will not do so.

16. MANNER OF EXERCISING SUBSCRIPTION RIGHTS THROUGH ORDER FORMS

As soon as practicable after the registration statement prepared by the Holding Company and the Bank has been declared effective by the SEC, and the Bank Regulators have approved the Conversion, cleared the proxy statement to be provided to Voting Members, and cleared the Prospectus and other offering materials for distribution, Order Forms will be distributed to the Eligible Account Holders, Employee Plans, Supplemental Eligible Account Holders and Other Members at their addresses appearing on the records of the Bank as of the Voting Record Date for the purpose of subscribing for shares of Common Stock in the Subscription Offering and will be made available for use by those other Persons to whom a Prospectus is delivered.

Each Order Form will be preceded or accompanied by a Prospectus describing the Holding Company, the Bank, the Common Stock and the Offering. Each Order Form will contain, among other things, the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. A specified date by which all Order Forms must be received by the Bank or the Holding Company or its agent, which date shall be at least 20 days but not more than 45 days following the date on which the Order Forms are mailed to Participants by the Holding Company, and which date will constitute the termination of the Subscription Offering unless extended;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. The Subscription Price per share for shares of Common Stock to be sold in the Offering;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;C. A description of the minimum and maximum number of Subscription Shares that may be subscribed for pursuant to the exercise of subscription rights or otherwise purchased in the Subscription and Community Offering;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;D. Instructions as to how the recipient of the Order Form is to indicate thereon the number of Subscription Shares for which such person elects to subscribe and the available alternative methods of payment therefor;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;E. An acknowledgment that the recipient of the Order Form has received a final copy of the Prospectus before execution of the Order Form;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;F. A statement to the effect that all subscription rights are nontransferable, will be void at the end of the Subscription Offering, and can only be exercised by delivering to the Bank or the Holding Company or its agent within the subscription period such properly completed and executed Order Form, together with payment in the full amount of the aggregate purchase price as specified in the Order Form for the shares of Common Stock for which the recipient elects to subscribe in the Subscription Offering (or by authorizing on the Order Form that the Bank withdraw said amount from the subscriber's Deposit Account at the Bank);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;G. A statement to the effect that the executed Order Form, once received by the Holding Company, may not be modified or amended by the subscriber without the consent of the Holding Company; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;H. Certain legends stating that subscription rights may not be transferred and that shares of the Common Stock are not deposits and are not insured or guaranteed by the federal government, and a certification stating that the subscriber is purchasing the shares for their own account.

Notwithstanding the above, the Holding Company reserves the right in its sole discretion to accept or reject orders received on photocopied or facsimilied order forms.

17. UNDELIVERED, DEFECTIVE OR LATE ORDER FORM; INSUFFICIENT PAYMENT

In the event Order Forms (a) are not delivered or are not timely delivered by the United States Postal Service, (b) are not received back by the Holding Company or its agent or are received by the Holding Company or its agent after the expiration date specified thereon, (c) are defectively filled out or executed, (d) are not accompanied by the full required payment, unless waived by the Holding Company, for the shares of Common Stock subscribed for (including cases in which deposit accounts from which withdrawals are authorized are insufficient to cover the amount of the required payment), or (e) are not mailed pursuant to a "no mail" order placed in effect by the account holder, the subscription rights of the Participant to whom such rights have been granted will lapse as though such Participant failed to return the completed Order Form within the time period specified thereon; *provided, however*, that the Holding Company may, but will not be required to, waive any immaterial irregularity on any Order Form or require the submission of a corrected Order Form or the remittance of full payment for subscribed shares by such date as the Holding Company may specify. The interpretation of the Holding Company of terms and conditions of this Plan and of the Order Forms will be final, subject to the authority of the Bank Regulators.

18. RESIDENTS OF FOREIGN COUNTRIES AND CERTAIN STATES

The Holding Company will make reasonable efforts to comply with the securities laws of all States in the United States in which Persons entitled to subscribe for shares of Common Stock pursuant to this Plan reside. However, no such Person will be issued subscription rights or be permitted to purchase shares of Common Stock in the Subscription Offering if such Person resides in a foreign country; or in a State of the United States with respect to which any of the following apply: (A) a small number of Persons otherwise eligible to subscribe for shares under this Plan reside in such state; (B) the issuance of subscription rights or the offer or sale of shares of Common Stock to such Persons would require the Holding Company under the securities laws of such state, to register as a broker, dealer, salesman or agent or to register or otherwise qualify its securities for sale in such state; and (C) such registration or qualification would be impracticable for reasons of cost or otherwise.

19. CONTRIBUTION TO THE FOUNDATION

As part of the Conversion, the Holding Company and the Bank intend to contribute the Foundation Shares and/or cash to the Foundation, in such amounts, subject to regulatory limits, as shall be approved by the Bank's Board of Directors. The contribution to the Foundation is intended to enhance the Bank's existing community reinvestment activities, and to share with the communities in which the Bank conducts business a part of the Bank's financial success as a community minded, financial services institution. The contribution of the Foundation Shares to the Foundation may further this goal as it may enable the community to share in the growth and profitability of the Holding Company and the Bank over the long term.

The Foundation will be dedicated to the promotion of charitable purposes including community development, grants or donations to support housing assistance, not-for-profit community groups and other types of organizations or civic-minded projects. The Foundation will annually distribute total grants to assist charitable organizations or to fund projects within its local community of not less than 5% of the average fair market value of Foundation assets each year, less certain expenses. In order to serve the purposes for which it was formed and to maintain its qualification under Section 501(c)(3) of the Code, the Foundation may sell, on an annual basis, a portion of the Foundation Shares.

For five years following the consummation of the Conversion, except for temporary periods resulting from death, resignation, removal or disqualification, (i) at least one director of the Foundation must be an independent director unaffiliated with the Holding Company and the Bank, must be from the Bank's local community, and must have experience with local community charitable organizations and grant making, and (ii) at least one director of the Foundation must also be a director of the Bank. The Foundation's Board of Directors will be responsible for establishing the Foundation's policies, including a conflicts of interest policy, consistent with the stated purposes of the Foundation.

The contribution to the Foundation as part of the Conversion must be approved by a majority of the total number of votes eligible to be cast by the Voting Members. If the contribution to the Foundation is not approved by the requisite vote of the Voting Members, then the shares of Common Stock consisting of the Foundation Shares that would have been contributed to the Foundation will not be issued and any cash that would have been contributed to the Foundation will be retained the Holding Company and/or the Bank. The decision to proceed with the formation of the Foundation and the grant of Foundation Shares and/or cash to the Foundation will be at the sole discretion of the Bank's Board of Directors.

20. ESTABLISHMENT OF LIQUIDATION ACCOUNT

The Bank shall establish, at the time of the Conversion, a Liquidation Account in an amount equal to the Bank's total equity as reflected in the latest statement of financial condition contained in the final Prospectus used in the Offering. Following the Conversion, the Liquidation Account will be maintained by the Bank for the benefit of the Eligible Account Holders and Supplemental Eligible Account Holders who continue to maintain their Deposit Accounts at the Bank. Each Eligible Account Holder and Supplemental Eligible Account Holder shall, with respect to their Deposit Account, hold a related inchoate interest in a portion of the Liquidation Account balance, in relation to their Deposit Account balance at the Eligibility Record Date or Supplemental Eligibility Record Date, respectively, or to such balance as it may be subsequently reduced, as hereinafter provided.

In the unlikely event of a complete liquidation of the Bank (and only in such event), following all liquidation payments to creditors (including those to Account Holders to the extent of their Deposit Accounts) each Eligible Account Holder and Supplemental Eligible Account Holder shall be entitled to receive a liquidating distribution from the Liquidation Account, in the amount of the then adjusted subaccount balance for their Deposit Account then held, before any liquidation distribution may be made to any holders of the Bank's capital stock. No merger, consolidation, purchase of bulk assets with assumption of Deposit Accounts and other liabilities, or similar transactions with an FDIC-insured institution, in which the Bank is not the surviving institution, shall be deemed to be a complete liquidation for this purpose. In such transactions, the Liquidation Account shall be assumed by the surviving institution.

The initial subaccount balance for a Deposit Account held by an Eligible Account Holder and Supplemental Eligible Account Holder shall be determined in accordance with 12 C.F.R. §192.460. Such initial subaccount balance shall not be increased, but shall be subject to downward adjustment as described in 12 C.F.R. §192.470. In the event of such downward adjustment, the subaccount balance shall not be subsequently increased, notwithstanding any subsequent increase in the deposit balance of the related Deposit Account. If any such Deposit Account is closed, the related subaccount shall be reduced to zero.

The establishment and maintenance of the Liquidation Account shall not operate to restrict the use or application of any of the equity accounts of the Bank, except that the Bank shall not declare or pay a cash dividend on, or repurchase any of, its capital stock if the effect thereof would cause its equity to be reduced below the amount required for the Liquidation Account.

21. VOTING RIGHTS OF STOCKHOLDERS

Following consummation of the Conversion, the holders of the voting capital stock of the Holding Company shall have the exclusive voting rights with respect to the Holding Company.

22. RESTRICTIONS ON RESALE OR SUBSEQUENT DISPOSITION

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. All shares of Common Stock purchased by Directors or Officers of the Holding Company or the Bank in the Offering shall be subject to the restriction that, except as provided in this Section 22 or as may be approved by the Bank Regulators, no interest in such shares may be sold or otherwise disposed of for value for a period of one year following the date of purchase in the Offering.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. The restriction on disposition of Subscription Shares set forth above in this Section 22 shall not apply to the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Any exchange of such shares in connection with a merger or acquisition involving the Bank or the Holding
Company, as the case may be, which has been approved by the appropriate Federal regulatory agency; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Any disposition of such shares following the death of the person to whom such shares were initially sold
under the terms of this Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;C. With respect to all Subscription Shares subject to restrictions on resale or subsequent disposition, each of the following provisions shall apply:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Each certificate representing shares restricted by this Section 22 shall bear a legend giving notice of
the restriction;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) Instructions shall be issued to the stock transfer agent for the Holding Company not to recognize or effect
any transfer of any certificate or record of ownership of any such shares in violation of the restriction on transfer; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Any shares of capital stock of the Holding Company issued with respect to a stock dividend, stock split,
or otherwise with respect to ownership of outstanding Subscription Shares subject to the restriction on transfer hereunder shall be subject
to the same restriction as is applicable to such Subscription Shares.

23. REQUIREMENTS FOR STOCK PURCHASES BY DIRECTORS AND OFFICERS FOLLOWING THE CONVERSION

For a period of three years from the date of consummation of the Conversion, no Officer, Director or their Associates shall purchase, without the prior written approval of the Bank Regulators, any outstanding shares of Common Stock except from a broker-dealer registered with the SEC. This provision shall not apply to negotiated transactions involving more than 1% of the outstanding shares of Common Stock, the exercise of any options pursuant to a stock option plan or purchases of Common Stock made by or held by any Tax-Qualified Employee Stock Benefit Plan or Non-Tax-Qualified Employee Stock Benefit Plan of the Bank or the Holding Company (including the Employee Plans) which may be attributable to any Officer or Director. As used herein, the term "negotiated transaction" means a transaction in which the securities are offered and the terms and arrangements relating to any sale are arrived at through direct communications between the seller or any person acting on its behalf and the purchaser or their investment representative. The term "investment representative" shall mean a professional investment advisor acting as agent for the purchaser and independent of the seller and not acting on behalf of the seller in connection with the transaction.

24. TRANSFER OF DEPOSIT ACCOUNTS

Each person holding a Deposit Account at the Bank at the time of Conversion shall retain an identical Deposit Account at the Bank following Conversion in the same amount and subject to the same terms and conditions (except as to voting and liquidation rights).

25. REGISTRATION AND MARKETING

Within the time period required by applicable laws and regulations, the Holding Company will register the securities issued in connection with the Conversion pursuant to the Securities Exchange Act of 1934, as amended, and will not deregister such securities for a period of at least three years thereafter, except that the requirement that registration be maintained for three years may be fulfilled by any successor to the Holding Company. In addition, the Holding Company will use its best efforts to encourage and assist a market maker to establish and maintain a market for the Common Stock and to list those securities on a national or regional securities exchange.

26. TAX RULINGS OR OPINIONS

Consummation of the Conversion is expressly conditioned upon prior receipt by the Bank of either a ruling or an opinion of counsel with respect to federal tax laws, and either a ruling, an opinion of counsel, or a letter of advice from their tax advisor with respect to applicable state tax laws, to the effect that consummation of the transactions contemplated by the Conversion and this Plan will not result in a taxable reorganization under the provisions of the applicable codes or otherwise result in any adverse tax consequences to the Holding Company or the Bank, or to the account holders receiving subscription rights before or after the Conversion, except in each case to the extent, if any, that subscription rights are deemed to have value on the date such rights are issued.

27. STOCK BENEFIT PLANS AND EMPLOYMENT AGREEMENTS

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. The Holding Company and the Bank are authorized to adopt Tax-Qualified Employee Stock Benefit Plans in connection with the Conversion, including without limitation, an ESOP. Existing as well as any newly created Tax-Qualified Employee Stock Benefit Plans may purchase shares of Common Stock in the Offering, to the extent permitted by the terms of such benefit plans and this Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. The Holding Company and the Bank are authorized to enter into employment and other compensation agreements with their executive officers.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;C. The Holding Company and the Bank are authorized to adopt stock option plans, restricted stock plans and other Non-Tax-Qualified Employee Stock Benefit Plans no sooner than six months after the completion of the Conversion and Offering, provided that such stock plans conform to any applicable requirements of federal regulations, including 12 C.F.R. §192.500. The Holding Company intends to implement such stock plans after the completion of the Conversion and Offering, subject to any necessary stockholder approvals. 12 C.F.R. §192.500 includes provisions regarding plan size, size of grants, vesting requirements for grants, and stockholder approval requirements, which shall be disclosed in the Prospectus.

28. RESTRICTIONS ON ACQUISITION OF BANK AND HOLDING COMPANY

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. For a period of three years from the date of consummation of the Conversion, no person, other than the Holding Company, may directly or indirectly offer to acquire or acquire the beneficial ownership of more than 10% of any class of an equity security of the Bank without the prior written consent of the Bank Regulators. Nothing in this Plan shall prohibit the Holding Company from repurchasing its shares in compliance with applicable regulations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. In connection with the Conversion, the Bank will amend and restate its articles of incorporation, constitution and bylaws. The Bank's amended articles of incorporation, constitution and bylaws may contain approved anti-takeover provisions, such as a provision stipulating that no person, except the Holding Company, for a period of five years following the closing date of the Conversion, may directly or indirectly acquire or offer to acquire the beneficial ownership of more than 10% of any class of equity security of the Bank, without the prior written approval of the Bank Regulators. The Bank's amended articles of incorporation or constitution may also provide that for a period of five years following the closing date of the Conversion, shares beneficially owned in violation of the above-described charter provision shall not be entitled to vote and shall not be voted by any person or counted as voting stock in connection with any matter submitted to stockholders for a vote. In addition, the Bank's amended articles of incorporation or constitution may also provide that special meetings of the stockholders relating to changes in control or amendment of the articles of incorporation or constitution may only be called by the Board of Directors, and shareholders shall not be permitted to cumulate their votes for the election of Directors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;C. The articles of incorporation of the Holding Company may contain a provision stipulating that in no event shall the record owners of any outstanding shares of Common Stock that are beneficially owned by a person who beneficially owns in excess of 10% of such outstanding shares be entitled or permitted to any vote with respect to any shares held in excess of 10%. In addition, the articles of incorporation and bylaws of the Holding Company may contain provisions that prohibit cumulative voting for the election of directors, provide for staggered terms for directors, limit the calling of special meetings, require supermajority shareholder votes to amend certain provisions of the articles of incorporation, allow the Board of Directors to issue preferred stock and increase the amount of authorized capital stock without shareholder approval, provide certain qualifications and restrictions for election as director, certain advance notice requirements for shareholder proposals and nominations and a fair price provision for certain business combinations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;D. For the purposes of this Section 28:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) The term "person" includes an individual, a firm, a corporation or other entity;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) The term "offer" includes every offer to buy or acquire, solicitation of an offer to sell,
tender offer for, or request or invitation for tenders of, a security or interest in a security for value;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) The term "acquire" includes every type of acquisition, whether effected by purchase, exchange,
operation of law or otherwise; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) The term "security" includes non-transferable subscription rights issued pursuant to a plan
of conversion as well as a "security" as defined in Section 2(a)(1) of the Securities Act of 1933, as amended.

29. PAYMENT OF DIVIDENDS AND REPURCHASE OF STOCK

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. The Holding Company shall comply with any applicable regulation in connection with the repurchase of any shares of its capital stock following consummation of the Conversion.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. The Bank shall not declare or pay a cash dividend on, or repurchase any of, its capital stock if the effect thereof would cause its regulatory capital to be reduced below (i) the amount required for the Liquidation Account, or (ii) applicable federal regulatory capital requirements.

30. CONSUMMATION OF CONVERSION AND EFFECTIVE DATE

The effective date of the Conversion shall be the date of closing of the sale of all shares of the Common Stock after all requisite regulatory and Member approvals have been obtained, all applicable waiting periods have expired, and sufficient subscriptions and orders for Subscription Shares have been received. The closing of the sale of all shares of Common Stock sold in the Offering shall occur simultaneously on the effective date of the closing.

31. EXPENSES OF CONVERSION

The Bank and the Holding Company may retain and pay for the services of legal, financial and other advisors to assist in connection with any or all aspects of the Conversion, including the Offering and contribution to the Foundation, and such parties shall use their best efforts to assure that such expenses are reasonable.

32. AMENDMENT OR TERMINATION OF PLAN

If deemed necessary or desirable, this Plan may be substantively amended as a result of comments from the Bank Regulators or the SEC or otherwise at any time before the solicitation of proxies from Voting Members to vote on this Plan by the Board of Directors of the Bank, and at any time thereafter by the Board of Directors of the Bank with the concurrence of the Bank Regulators. Any amendment to this Plan made after approval by Voting Members with the approval of the Bank Regulators shall not require further approval by Voting Members unless otherwise required by the Bank Regulators. The Board of Directors of the Bank may terminate this Plan at any time before the Meeting of Members to vote on this Plan, and at any time thereafter with the concurrence of the Bank Regulators.

By adopting this Plan, Voting Members of the Bank authorize the Board of Directors of the Bank to amend or terminate this Plan under the circumstances set forth in this Section 32.

33. CONDITIONS TO CONVERSION

Consummation of the Conversion pursuant to this Plan is expressly conditioned upon the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. Prior receipt by the Bank of rulings of the U.S. Internal Revenue Service and the state taxing authorities, or opinions of counsel or tax advisers as described in Section 25;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. The issuance of at least the minimum number of Subscription Shares offered for sale in the Offering; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;C. The completion of the Conversion within the time period specified in Section 3.

34. INTERPRETATION

All interpretations of this Plan, and the application of its provisions to particular circumstances, by a majority of the Board of Directors of the Bank or Holding Company, as applicable, shall be final, subject to the authority of the Bank Regulators.

Adopted: March 3, 2023

## Exhibit 3.1

**Exhibit 3.1**

**ARTICLES OF INCORPORATION**

**MERCER BANCORP, INC.**

The undersigned, Alvin B. Parmiter, whose address is 1100 Irmscher Blvd, Celina, Ohio 45822, being at least eighteen years of age, acting as incorporator, does hereby form a corporation under the general laws of the State of Maryland, having the following Articles of Incorporation (the "Articles"):

**ARTICLE 1. Name.** The name of the corporation is Mercer Bancorp, Inc. (herein, the "Corporation").

**ARTICLE 2. Principal Office.** The address of the principal office of the Corporation in the State of Maryland is c/o CSC-Lawyers Incorporating Service Company, 7 St. Paul Street, Suite 820, Baltimore, Maryland 21202.

**ARTICLE 3. Purpose.** The purpose for which the Corporation is formed is to engage in any lawful act or activity for which corporations may be organized under the general laws of the State of Maryland as now or hereafter in force.

**ARTICLE 4. Resident Agent.** The name and address of the registered agent of the Corporation in the State of Maryland is CSC-Lawyers Incorporating Service Company, 7 St. Paul Street, Suite 820, Baltimore, Maryland 21202. Said resident agent is a Maryland corporation.

**ARTICLE 5. Capital Stock**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**A.** **Authorized Stock.** The total number of shares of capital stock of all classes that the Corporation has authority to issue is ten million (10,000,000) shares, consisting of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Nine million (9,000,000) shares of common stock, par value one cent ($0.01) per share (the "Common Stock"); and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. One million (1,000,000) shares of preferred stock, par value one cent ($0.01) per share (the "Preferred Stock").

The aggregate par value of all the authorized shares of capital stock is one hundred thousand dollars ($100,000.00). Except to the extent required by governing law, rule or regulation, the shares of capital stock may be issued from time to time by the Board of Directors without further approval of the stockholders of the Corporation. The Corporation shall have the authority to purchase its capital stock out of funds lawfully available therefor, which funds shall include, without limitation, the Corporation's unreserved and unrestricted capital surplus. The Board of Directors, pursuant to a resolution approved by a majority of the Whole Board (rounded up to the nearest whole number), and without action by the stockholders, may amend these Articles to increase or decrease the aggregate number of shares of stock or the number of shares of stock of any class or series that the Corporation has authority to issue. For the purposes of these Articles, the term "Whole Board" shall mean the total number of directors that the Corporation would have if there were no vacancies on the Board of Directors at the time any such resolution is presented to the Board of Directors for adoption.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**B.** **Common Stock.** Except as provided under the terms of any series of Preferred Stock and as limited by Section D of this Article 5, the exclusive voting power shall be vested in the Common Stock. Except as otherwise provided in these Articles, each holder of the Common Stock shall be entitled to one vote for each share of Common Stock standing in the holder's name on the books of the Corporation. Subject to any rights and preferences of any series of Preferred Stock, holders of Common Stock shall be entitled to such dividends as may be declared by the Board of Directors out of funds lawfully available therefor. Upon the liquidation, dissolution or winding up of the affairs of the Corporation, whether voluntary or involuntary, holders of Common Stock shall be entitled to receive all the remaining assets of the Corporation available for distribution to its stockholders ratably in proportion to the number of shares held by them, respectively, after: (i) payment or provision for payment of the Corporation's debts and liabilities; and (ii) distributions or provisions for distributions to holders of any class or series of stock having a preference over the Common Stock in the liquidation, dissolution or winding up of the Corporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**C.** **Preferred Stock.** The Board of Directors is hereby expressly authorized, subject to any limitations prescribed by law, to provide for the issuance of the shares of Preferred Stock in series, to establish from time to time the number of shares to be included in each such series, and to fix the preferences, conversion and other rights, voting powers, restrictions, limitations as to dividends, qualifications and terms and conditions of redemption of the shares of each such series. The number of authorized shares of the Preferred Stock may be increased or decreased (but not below the number of shares thereof then outstanding) by the affirmative vote of the holders of a majority of the Common Stock, without a vote of the holders of the Preferred Stock, or of any series thereof, unless a vote of any such holders is required by law or pursuant to the terms of such Preferred Stock. The power of the stockholders to increase or decrease the authorized shares of the Preferred Stock shall not limit any of the powers of the Board of Directors provided under these Articles.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**D.** **Restrictions on Voting Rights of the Corporation's Equity Securities.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Notwithstanding any other provision of these Articles, in no event shall the record owner (or if more than one record owner, all such record owners taken as a group) of any outstanding Common Stock that is beneficially owned, directly or indirectly, by a Person who, as of any record date for the determination of stockholders entitled to vote on any matter, beneficially owns in excess of 10% of the then-outstanding shares of Common Stock (the "Limit"), be entitled, or permitted to any vote in respect of the shares held in excess of the Limit. The number of votes that may be cast by any particular record owner by virtue of the provisions hereof in respect of Common Stock beneficially owned by such Person owning shares in excess of the Limit (a "Holder in Excess") shall be a number equal to the total number of votes that a single record owner of all Common Stock owned by such Holder in Excess would be entitled to cast after giving effect to the provisions hereof, multiplied by a fraction, the numerator of which is the number of shares of such class or series that are both (i) beneficially owned by such Holder in Excess and (ii) owned of record by such particular record owner, and the denominator of which is the total number of shares of Common Stock beneficially owned by such Holder in Excess. The provisions of this Section D of this Article 5 shall not be applicable if, before the Holder in Excess acquired beneficial ownership of such shares in excess of the Limit, such acquisition was approved by a majority of the "Unaffiliated Directors." For this purpose, the term "Unaffiliated Director" means any member of the Board of Directors who is unaffiliated with the Holder in Excess and was a member of the Board of Directors before the time that the Holder in Excess became such, and any director who is thereafter chosen to fill any vacancy on the Board of Directors and who is elected and who, in either event, is unaffiliated with the Holder in Excess and in connection with their initial assumption of office is recommended for appointment or election by a majority of the Unaffiliated Directors then serving on the Board of Directors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. The following definitions shall apply to this Section D of this Article 5.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) An "affiliate" of a specified Person shall mean a Person that directly, or indirectly through one or more intermediaries,
controls, or is controlled by, or is under common control with, the Person specified.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) "Beneficial ownership" shall be determined pursuant to Rule 13d-3 of the General Rules and Regulations under
the Securities Exchange Act of 1934 (or any successor rule or statutory provision), or, if said Rule 13d-3 shall be rescinded
and there shall be no successor rule or statutory provision thereto, pursuant to said Rule 13d-3 as in effect on December 31,
2022; provided, however, that a Person shall, in any event, also be deemed the "beneficial owner" of any Common Stock:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) that such Person or any of its affiliates beneficially owns, directly or indirectly; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) that such Person or any of its affiliates has (i) the right to acquire (whether such right is exercisable immediately or only
after the passage of time), pursuant to any agreement, arrangement or understanding (but shall not be deemed to be the beneficial owner
of any voting shares solely by reason of an agreement, contract, or other arrangement with the Corporation to effect any transaction of
the type described in clause (i) or (ii) of the first sentence of Article 9 hereof) or upon the exercise of conversion
rights, exchange rights, warrants, or options or otherwise, or (ii) sole or shared voting or investment power with respect thereto
pursuant to any agreement, arrangement, understanding, relationship or otherwise (but shall not be deemed to be the beneficial owner of
any voting shares solely by reason of a revocable proxy granted for a particular meeting of stockholders, pursuant to a public solicitation
of proxies for such meeting, with respect to shares of which neither such Person nor any such affiliate is otherwise deemed the beneficial
owner); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) that are beneficially owned, directly or indirectly, by any other Person with which such first mentioned Person or any of its affiliates
acts as a partnership, limited partnership, syndicate or other group pursuant to any agreement, arrangement or understanding for the purpose
of acquiring, holding, voting or disposing of any shares of capital stock of the Corporation; and provided further, however, that (i) no
director or officer of the Corporation (or any affiliate of any such director or officer) shall, solely by reason of any or all of such
directors or officers acting in their capacities as such, be deemed, for any purposes hereof, to beneficially own any Common Stock beneficially
owned by any other such director or officer (or any affiliate thereof), and (ii) neither any employee stock ownership or similar
plan of the Corporation or any subsidiary of the Corporation nor any trustee with respect thereto (or any affiliate of such trustee) shall,
solely by reason of such capacity of such trustee, be deemed, for any purposes hereof, to beneficially own any Common Stock held under
any such plan. For purposes of computing the percentage of beneficial ownership of Common Stock of a Person, the outstanding Common Stock
shall include shares deemed owned by such Person through application of this subsection but shall not include any other shares of Common
Stock that may be issuable by the Corporation pursuant to any agreement, or upon exercise of conversion rights, warrants or options, or
otherwise. For all other purposes, the outstanding Common Stock shall include only Common Stock then outstanding and shall not include
any Common Stock that may be issuable by the Corporation pursuant to any agreement, or upon the exercise of conversion rights, warrants
or options, or otherwise.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) A "Person" shall mean any individual, firm, corporation, or other entity.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The Board of Directors shall have the power to construe and apply the provisions of this Section D and to make all determinations
necessary or desirable to implement such provisions including, but not limited to, matters with respect to (i) the number of shares
of Common Stock beneficially owned by any Person, (ii) whether a Person is an affiliate of another, (iii) whether a Person has
an agreement, arrangement, or understanding with another as to the matters referred to in the definition of beneficial ownership, (iv) the
application of any other definition or operative provision of this Section D to the given facts, or (v) any other matter relating
to the applicability or effect of this Section D.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. The Board of Directors shall have the right to demand that any Person reasonably believed by the Board of Directors to be a Holder in Excess (or holder of record of Common Stock beneficially owned by any Holder in Excess) supply the Corporation with complete information as to (i) the record owner(s) of all shares beneficially owned by such Holder in Excess, and (ii) any other factual matter relating to the applicability or effect of this section as may reasonably be requested of such Holder in Excess. The Board of Directors shall further have the right to receive from any Holder in Excess reimbursement for all expenses incurred by the Board in connection with its investigation of any matters relating to the applicability or effect of this section on such Holder in Excess, to the extent such investigation is deemed appropriate by the Board of Directors as a result of the Holder in Excess refusing to supply the Corporation with the information described in the previous sentence.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. Any constructions, applications, or determinations made by the Board of Directors pursuant to this Section D in good faith and on the basis of such information and assistance as was then reasonably available for such purpose, shall be conclusive and binding upon the Corporation and its stockholders.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. If any provision (or portion thereof) of this Section D shall be found to be invalid, prohibited or unenforceable for any reason, the remaining provisions (or portions thereof) of this Section D shall remain in full force and effect, and shall be construed as if such invalid, prohibited or unenforceable provision had been stricken herefrom or otherwise rendered inapplicable, it being the intent of the Corporation and its stockholders that each such remaining provision (or portion thereof) of this Section D remain, to the fullest extent permitted by law, applicable and enforceable as to all stockholders, including Holders in Excess, notwithstanding any such finding.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**E.** **Majority Vote for Certain Actions.** With respect to those actions as to which any provision of the Maryland General Corporation Law (the "MGCL") requires stockholder authorization by a greater proportion than a majority of the total number of shares of all classes of capital stock or of the total number of shares of any class of capital stock, any such action shall be valid and effective if authorized by the affirmative vote of the holders of a majority of the total number of shares of all classes outstanding and entitled to vote thereon, except as otherwise provided in these Articles.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**F.** **Quorum.** Except as otherwise provided by law or expressly provided in these Articles, the presence, in person or by proxy, of the holders of record of shares of capital stock of the Corporation entitling the holders thereof to cast a majority of the votes (after giving effect, if required, to the provisions of Article 5, Section D) entitled to be cast by the holders of shares of capital stock of the Corporation entitled to vote shall constitute a quorum at all meetings of the stockholders, and every reference in these Articles to a majority or other proportion of capital stock (or the holders thereof) for purposes of determining any quorum requirement or any requirement for stockholder consent or approval shall be deemed to refer to such majority or other proportion of the votes (or the holders thereof) then entitled to be cast in respect of such capital stock.

**ARTICLE 6. Preemptive Rights and Appraisal Rights.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**A.** **Preemptive Rights.** Except for preemptive rights approved by the Board of Directors pursuant to a resolution approved by a majority of the directors then in office, no holder of the capital stock of the Corporation or series of stock or of options, warrants or other rights to purchase shares of any class or series of stock or of other securities of the Corporation shall have any preemptive right to purchase or subscribe for any unissued capital stock of any class or series, or any unissued bonds, certificates of indebtedness, debentures or other securities convertible into or exchangeable for capital stock of any class or series or carrying any right to purchase stock of any class or series.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**B.** **Appraisal Rights.** Holders of shares of stock shall not be entitled to exercise any rights of an objecting stockholder provided for under Title 3, Subtitle 2 of the MGCL or any successor statute unless the Board of Directors, pursuant to a resolution approved by a majority of the directors then in office, shall determine that such rights apply with respect to all or any classes or series of stock, to one or more transactions occurring after the date of such determination in connection with which holders of such shares would otherwise be entitled to exercise such rights.

**ARTICLE 7. Directors.** The following provisions are made a part of these Articles for the management of the business and the conduct of the affairs of the Corporation, and for further definition, limitation and regulation of the powers of the Corporation and of its directors and stockholders:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**A.** **Management of the Corporation.** The business and affairs of the Corporation shall be managed under the direction of the Board of Directors. All powers of the Corporation may be exercised by or under the authority of the Board of Directors, except as conferred on or as reserved to the stockholders by law or by these Articles or the Bylaws of the Corporation; provided, however, that any limitations on the Board of Directors' management or direction of the affairs of the Corporation shall reserve the directors' full power to discharge their fiduciary duties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**B.** **Number, Class and Terms of Directors; No Cumulative Voting.** The number of directors constituting the Board of Directors of the Corporation shall initially be six (6), which number may be increased or decreased in the manner provided in the Bylaws of the Corporation; provided, however, that such number shall never be less than the minimum number of directors required by the MGCL now or hereafter in force. The directors, other than those who may be elected by the holders of any series of Preferred Stock, shall be divided into three classes, with the term of office of the first class ("Class I") to expire at the conclusion of the first annual meeting of stockholders, the term of office of the second class ("Class II") to expire at the conclusion of the annual meeting of stockholders one year thereafter and the term of office of the third class ("Class III") to expire at the conclusion of the annual meeting of stockholders two years thereafter, with each director to hold office until their successor shall have been duly elected and qualified. At each annual meeting of stockholders, directors elected to succeed those directors whose terms expire shall be elected for a term of office to expire at the third succeeding annual meeting of stockholders after their election or for such shorter period of time as the Board of Directors may determine, with each director to hold office until their term expires and until their successor shall have been duly elected and qualified.

The names of the individuals who will serve as the initial directors of the Corporation until their successors are elected and qualify are as follows:

---

| |
|:---|
| **Term to Expire in 2024:** |
| Jose W. Faller |
| Richard A. Mosier |
| **Term to Expire in 2025**: |
| Michael J. Boley |
| Kristin M. Fee |
| **Term to Expire in 2026**: |
| David L. Keiser |
| Alvin B. Parmiter |

---

Stockholders shall not be permitted to cumulate their votes in the election of directors. A plurality of all the votes cast at a meeting at which a quorum is present is sufficient to elect a director.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**C.** **Vacancies.** Any vacancies in the Board of Directors may be filled in the manner provided in the Bylaws of the Corporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**D.** **Removal.** Subject to the rights of the holders of any series of Preferred Stock then outstanding, any director, or the entire Board of Directors, may be removed from office at any time, but only for cause and only by the affirmative vote of the holders of at least two-thirds (2/3) of the voting power of all of the then-outstanding shares of capital stock of the Corporation entitled to vote generally in the election of directors (after giving effect to the provisions of Article 5 hereof) voting together as a single class.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**E.** **Stockholder Proposals and Nominations of Directors.** Advance notice of stockholder nominations for the election of directors and of business to be brought by stockholders before any meeting of the stockholders of the Corporation shall be given in the manner provided in the Bylaws of the Corporation. Stockholder proposals to be presented in connection with a special meeting of stockholders shall be presented by the Corporation only to the extent required by Section 2-502 of the MGCL and the Bylaws of the Corporation.

**ARTICLE 8. Bylaws.** The Board of Directors is expressly empowered to adopt, amend or repeal the Bylaws of the Corporation. Any adoption, amendment or repeal of the Bylaws of the Corporation by the Board of Directors shall require the approval of a majority of the Whole Board. The stockholders shall also have power to adopt, amend or repeal the Bylaws of the Corporation. In addition to any vote of the holders of any class or series of stock of the Corporation required by law or by these Articles, the affirmative vote of the holders of at least 80% of the voting power of all of the then-outstanding shares of the capital stock of the Corporation entitled to vote generally in the election of directors (after giving effect to the provisions of Article 5 hereof), voting together as a single class, shall be required for the adoption, amendment or repeal of any provisions of the Bylaws of the Corporation by the stockholders.

**ARTICLE 9. Evaluation of Certain Offers.** The Board of Directors, when evaluating (i) any offer of another Person (as defined below) to (A) make a tender or exchange offer for any equity security of the Corporation, (B) merge or consolidate the Corporation with another corporation or entity, or (C) purchase or otherwise acquire all or substantially all of the properties and assets of the Corporation or (ii) any other actual or proposed transaction that would or may involve a change in control of the Corporation (whether by purchases of shares of stock or any other securities of the Corporation in the open market or otherwise, tender offer, merger, consolidation, share exchange, dissolution, liquidation, sale of all or substantially all of the assets of the Corporation, proxy solicitation or otherwise), may, in connection with the exercise of its business judgment in determining what is in the best interests of the Corporation and its stockholders and in making any recommendation to the Corporation's stockholders, give due consideration to all relevant factors, including, but not limited to: (A) the economic effect, both immediate and long-term, upon the Corporation's stockholders, including stockholders, if any, who do not participate in the transaction; (B) the social and economic effect on the present and future employees, creditors and customers of, and others dealing with, the Corporation and its subsidiaries and on the communities in which the Corporation and its subsidiaries operate or are located; (C) whether the proposal is acceptable based on the historical, current or projected future operating results or financial condition of the Corporation; (D) whether a more favorable price could be obtained for the Corporation's stock or other securities in the future; (E) the reputation and business practices of the other entity to be involved in the transaction and its management and affiliates as they would affect the employees of the Corporation and its subsidiaries; (F) the future value of the stock or any other securities of the Corporation or the other entity to be involved in the proposed transaction; (G) any antitrust or other legal and regulatory issues that are raised by the proposal; (H) the business and historical, current or expected future financial condition or operating results of the other entity to be involved in the transaction, including, but not limited to, debt service and other existing financial obligations, financial obligations to be incurred in connection with the proposed transaction, and other likely financial obligations of the other entity to be involved in the proposed transaction; and (I) the ability of the Corporation to fulfill its objectives as a financial institution holding company and on the ability of its subsidiary financial institution(s) to fulfill the objectives of a federally insured financial institution under applicable statutes and regulations. If the Board of Directors determines that any proposed transaction of the type described in clause (i) or (ii) of the immediately preceding sentence should be rejected, it may take any lawful action to defeat such transaction, including, but not limited to, any or all of the following: advising stockholders not to accept the proposal; instituting litigation against the party making the proposal; filing complaints with governmental and regulatory authorities; acquiring the stock or any of the securities of the Corporation; selling or otherwise issuing authorized but unissued stock or other securities or granting options or rights with respect thereto; and obtaining a more favorable offer from another individual or entity. This Article 9 sets forth certain factors that may be considered by the Board of Directors, but does not create any implication concerning the factors that must be considered, or any other factors that may or may not be considered, by the Board of Directors regarding any proposed transaction of the type described in clause (i) or (ii) of the first sentence of this Article 9.

For purposes of this Article 9, a "Person" shall include an individual, a group acting in concert, a corporation, a partnership, an association, a joint venture, a pool, a joint stock company, a trust, an unincorporated organization or similar company, a syndicate or any other group or entity formed for the purpose of acquiring, holding or disposing of securities.

**ARTICLE 10. Indemnification, etc. of Directors and Officers.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**A.** **Indemnification.** The Corporation shall indemnify (1) its current and former directors and officers, whether serving the Corporation or at its request any other entity, to the fullest extent required or permitted by the MGCL now or hereafter in force, including the advancement of expenses under the procedures and to the fullest extent permitted by law, and (2) other employees and agents to such extent as shall be authorized by the Board of Directors and permitted by law; provided, however, that, except as provided in Section B of this Article 10 with respect to proceedings to enforce rights to indemnification, the Corporation shall indemnify any such indemnitee in connection with a proceeding (or part thereof) initiated by such indemnitee only if such proceeding (or part thereof) was authorized by the Board of Directors of the Corporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**B.** **Procedure.** If a claim under Section A of this Article 10 is not paid in full by the Corporation within sixty (60) days after a written claim has been received by the Corporation, except in the case of a claim for an advancement of expenses, in which case the applicable period shall be twenty (20) days, the indemnitee may at any time thereafter bring suit against the Corporation to recover the unpaid amount of the claim. If successful in whole or in part in any such suit, or in a suit brought by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the indemnitee shall also be entitled to be reimbursed the expense of prosecuting or defending such suit. It shall be a defense to any action for advancement of expenses that the Corporation has not received both (i) an undertaking as required by law to repay such advances if it shall ultimately be determined that the standard of conduct has not been met and (ii) a written affirmation by the indemnitee of his good faith belief that the standard of conduct necessary for indemnification by the Corporation has been met. In (i) any suit brought by the indemnitee to enforce a right to indemnification hereunder (but not in a suit brought by the indemnitee to enforce a right to an advancement of expenses) it shall be a defense that, and (ii) any suit by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking the Corporation shall be entitled to recover such expenses upon a final adjudication that, the indemnitee has not met the applicable standard for indemnification set forth in the MGCL. Neither the failure of the Corporation (including its Board of Directors, independent legal counsel, or its stockholders) to have made a determination before the commencement of such suit that indemnification of the indemnitee is proper in the circumstances because the indemnitee has met the applicable standard of conduct set forth in the MGCL, nor an actual determination by the Corporation (including its Board of Directors, independent legal counsel, or its stockholders) that the indemnitee has not met such applicable standard of conduct, shall create a presumption that the indemnitee has not met the applicable standard of conduct or, in the case of such a suit brought by the indemnitee, be a defense to such suit. In any suit brought by the indemnitee to enforce a right to indemnification or to an advancement of expenses hereunder, or by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the burden of proving that the indemnitee is not entitled to be indemnified, or to such advancement of expenses, under this Article 10 or otherwise shall be on the Corporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**C.** **Non-Exclusivity.** The rights to indemnification and to the advancement of expenses conferred in this Article 10 shall not be exclusive of any other right that any Person may have or hereafter acquire under any statute, these Articles, the Corporation's Bylaws, any agreement, any vote of stockholders or the Board of Directors, or otherwise.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**D.** **Insurance.** The Corporation may maintain insurance, at its expense, to insure itself and any director, officer, employee or agent of the Corporation or another corporation, partnership, joint venture, trust or other enterprise against any expense, liability or loss, whether or not the Corporation would have the power to indemnify such Person against such expense, liability or loss under the MGCL.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**E.** **Miscellaneous.** The Corporation shall not be liable for any payment under this Article 10 in connection with a claim made by any indemnitee to the extent such indemnitee has otherwise actually received payment under any insurance policy, agreement, or otherwise, of the amounts otherwise indemnifiable hereunder. The rights to indemnification and to the advancement of expenses conferred in Sections A and B of this Article 10 shall be contract rights and such rights shall continue as to an indemnitee who has ceased to be a director or officer and shall inure to the benefit of the indemnitee's heirs, executors and administrators.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**F.** **Limitations Imposed by Federal Law.** Notwithstanding any other provision set forth in this Article 10, in no event shall any payments made by the Corporation pursuant to this Article 10 exceed the amount permissible under applicable federal law, including, without limitation, Section 18(k) of the Federal Deposit Insurance Act and the regulations promulgated thereunder.

Any repeal or modification of this Article 10 shall not in any way diminish any rights to indemnification or advancement of expenses of such director or officer or the obligations of the Corporation arising hereunder with respect to events occurring, or claims made, while this Article 10 is in force.

**ARTICLE 11. Limitation of Liability.** An officer or director of the Corporation, as such, shall not be liable to the Corporation or its stockholders for money damages, except (A) to the extent that it is proved that the Person actually received an improper benefit or profit in money, property or services, for the amount of the benefit or profit in money, property or services actually received; or (B) to the extent that a judgment or other final adjudication adverse to the Person is entered in a proceeding based on a finding in the proceeding that the Person's action, or failure to act, was the result of active and deliberate dishonesty and was material to the cause of action adjudicated in the proceeding; or (C) to the extent otherwise provided by the MGCL. If the MGCL is amended to further eliminate or limit the personal liability of officers and directors, then the liability of officers and directors of the Corporation shall be eliminated or limited to the fullest extent permitted by the MGCL, as so amended.

Any repeal or modification of the foregoing paragraph by the stockholders of the Corporation shall not adversely affect any right or protection of a director or officer of the Corporation existing at the time of such repeal or modification.

**ARTICLE 12**: **Selection of Forum.** Unless the Corporation consents in writing to the selection of an alternative forum, the sole and exclusive forum for (i) any derivative action or proceeding brought on behalf of the Corporation, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of the Corporation to the Corporation or the Corporation's stockholders, (iii) any action asserting a claim arising pursuant to any provision of the MGCL, or (iv) any action asserting a claim governed by the internal affairs doctrine shall be a state or federal court located within the State of Maryland, in all cases subject to the court's having personal jurisdiction over the indispensable parties named as defendants. The provisions of this Article 12 shall not apply to claims arising under the federal securities laws. Any person or entity purchasing or otherwise acquiring any interest in shares of capital stock of the Corporation shall be deemed to have notice of and consented to the provisions of this Article 12.

**ARTICLE 13. Amendment of the Articles of Incorporation.** The Corporation reserves the right to amend or repeal any provision contained in these Articles in the manner prescribed by the MGCL, including any amendment altering the terms or contract rights, as expressly set forth in these Articles, of any of the Corporation's outstanding stock by classification, reclassification or otherwise, and no stockholder approval shall be required if the approval of stockholders is not required for the proposed amendment or repeal by the MGCL, and all rights conferred upon stockholders are granted subject to this reservation.

The Board of Directors, pursuant to a resolution approved by a majority of the Whole Board (rounded up to the nearest whole number), and without action by the stockholders, may amend these Articles to increase or decrease the aggregate number of shares of stock or the number of shares of stock of any class or series that the Corporation has authority to issue.

No proposed amendment or repeal of any provision of these Articles shall be submitted to a stockholder vote unless the Board of Directors shall have (1) approved the proposed amendment or repeal, (2) determined that it is advisable, and (3) directed that it be submitted for consideration at either an annual or special meeting of the stockholders pursuant to a resolution approved by the Board of Directors. Any proposed amendment or repeal of any provision of these Articles may be abandoned by the Board of Directors at any time before its effective time upon the adoption of a resolution approved by a majority of the Whole Board (rounded up to the nearest whole number).

The amendment or repeal of any provision of these Articles shall be approved by at least two-thirds (2/3) of all votes entitled to be cast by the holders of shares of capital stock of the Corporation entitled to vote on the matter (after giving due effect to the provisions of Article 5 of these Articles), except that the proposed amendment or repeal of any provision of these Articles need only be approved by the vote of a majority of all the votes entitled to be cast by the holders of shares of capital stock of the Corporation entitled to vote on the matter (after giving due effect to the provisions of Article 5 of these Articles) if the amendment or repeal of such provision is approved by the Board of Directors pursuant to a resolution approved by at least two-thirds (2/3) of the Whole Board (rounded up to the nearest whole number).

Notwithstanding any other provision of these Articles or any provision of law that might otherwise permit a lesser vote or no vote, but in addition to any vote of the holders of any class or series of the stock of the Corporation required by law or by these Articles, the affirmative vote of the holders of at least 80% of the voting power of all of the then-outstanding shares of the capital stock of the Corporation entitled to vote generally in the election of directors (after giving effect to the provisions of Article 5), voting together as a single class, shall be required to amend or repeal this Article 13, Section C, D, E or F of Article 5, Article 7 (other than the removal of the list of initial directors), Article 8, Article 9, Article 10, Article 11 or Article 12.

**ARTICLE 14. Name and Address of Incorporator.** The name and mailing address of the sole incorporator are as follows:

Alvin B. Parmiter

1100 Irmscher Blvd

Celina, Ohio 45822

*[Signature Page Immediately Follows]*

I, THE UNDERSIGNED, being the incorporator, for the purpose of forming a corporation under the laws of the State of Maryland, do make, file and record these Articles of Incorporation, do certify that the facts herein stated are true, and, accordingly, have hereto set my hand this 6th day of March, 2023.

---

| |
|:---|
| /s/ Alvin B. Parmiter |
| Alvin B. Parmiter |
| Incorporator |

---

## Exhibit 3.2

**Exhibit 3.2**

**MERCER BANCORP, INC.**

**BYLAWS**

**ARTICLE I**

**STOCKHOLDERS**

**Section 1. Annual Meeting.**

Mercer Bancorp, Inc. (the "Corporation") shall hold an annual meeting of its stockholders to elect directors and to transact any other business within its powers, at such place, on such date and at such time as the Board of Directors shall fix. Failure to hold an annual meeting does not invalidate the Corporation's existence or affect any otherwise valid corporate act.

**Section 2. Special Meetings.**

Special meetings of stockholders of the Corporation may be called by the President, the Chief Executive Officer or the Chairperson of the Board or by the Board of Directors pursuant to a resolution adopted by a majority of the total number of directors that the Corporation would have if there were no vacancies on the Board of Directors (hereinafter the "Whole Board"). Special meetings of the stockholders shall be called by the Secretary at the request of stockholders only on the written request of stockholders entitled to cast at least a majority of all the votes entitled to be cast at the meeting. Such written request shall state the purpose or purposes of the meeting and the matters proposed to be acted upon at the meeting, and shall be delivered at the principal office of the Corporation addressed to the President or the Secretary. The Secretary shall inform the stockholders who make the request of the reasonably estimated cost of preparing and mailing a notice of the meeting and, upon payment of these costs to the Corporation, notify each stockholder entitled to notice of the meeting. The Board of Directors shall have the sole power to fix (i) the record date for determining stockholders entitled to request a special meeting of stockholders and the record date for determining stockholders entitled to notice of and to vote at the special meeting and (ii) the date, time and place of the special meeting and the means of remote communication, if any, by which stockholders and proxy holders may be considered present in person and may vote at the special meeting.

**Section 3. Notice of Meetings; Adjournment or Postponement.**

Not less than ten (10) nor more than ninety (90) days before each stockholders' meeting, the Secretary shall give notice of the meeting in writing or by electronic transmission to each stockholder entitled to vote at the meeting and to each other stockholder entitled to notice of the meeting. The notice shall state the time and place of the meeting, the means of remote communication, if any, by which stockholders and proxy holders may be deemed to be present in person and may vote at the meeting, and, if the meeting is a special meeting, or notice of the purpose is required by statute, the purpose of the meeting. Notice is given to a stockholder when it is personally delivered to the stockholder, left at the stockholder's residence or usual place of business, mailed to the stockholder at the stockholder's address as it appears on the records of the Corporation, or transmitted to the stockholder by an electronic transmission to any address or number of the stockholder at which the stockholder receives electronic transmissions. If the Corporation has received a request from a stockholder that notice not be sent by electronic transmission, the Corporation may not provide notice to the stockholder by electronic transmission. Notwithstanding the foregoing provisions, each person who is entitled to notice waives notice if such person, before or after the meeting, delivers a written waiver or waiver by electronic transmission which is filed with the records of the stockholders' meetings, or if such person is present at the meeting in person or by proxy.

A meeting of stockholders convened on the date for which it was called may be adjourned from time to time without further notice to a date not more than one hundred twenty (120) days after the original record date. A meeting may be adjourned by a resolution adopted by a majority of the Whole Board or by the vote of a majority of the stockholders present at the meeting, whether or not a quorum is present at such meeting. At any adjourned meeting, any business may be transacted that might have been transacted at the original meeting.

A meeting of stockholders may be postponed to a date not more than one hundred twenty (120) days after the original record date. A meeting may be postponed by a resolution adopted by a majority of the Whole Board. Notice of the date, time and place to which the meeting is postponed shall be given not less than ten (10) days before such date and otherwise in the manner set forth in this Section 3. At any postponed meeting, any business may be transacted that might have been transacted at the meeting as originally scheduled.

If a meeting shall be adjourned or postponed to a date not more than one hundred twenty (120) days after the original record date, a new record date need not be established, and the original record date may be used for the purpose of determining which stockholders are entitled to notice of, and to vote at, the adjourned or postponed meeting. Any writing authorizing another person to act as proxy at a meeting of stockholders shall remain valid for use at any adjournment or postponement of such meeting unless such proxy is revoked or a later dated proxy is provided by such stockholder.

As used in these Bylaws, the term "electronic transmission" shall have the meaning given to such term by Section 1-101 of the Maryland General Corporation Law (the "MGCL") or any successor provision.

**Section 4. Quorum.**

Unless the Articles of Incorporation provide otherwise, where a separate vote by a class or classes is required, a majority of the shares of such class or classes, present in person or represented by proxy, shall constitute a quorum entitled to take action with respect to that vote on that matter.

If a quorum shall fail to attend any meeting, the chairperson of the meeting or the holders of a majority of the shares of stock who are present at the meeting, in person or by proxy, may, in accordance with Section 3 of this Article I, adjourn the meeting to another place, date or time.

**Section 5. Organization and Conduct of Business.**

The Chairperson of the Board of Directors or the Vice Chairperson of the Board, if any, or in their absence, the Chief Executive Officer, or in their absence, such other person as may be designated by a majority of the Whole Board, shall call to order any meeting of the stockholders and act as chairperson of the meeting. In the absence of the Secretary, the secretary of the meeting shall be such person as the chairperson of the meeting appoints. The chairperson of any meeting of stockholders shall determine the order of business and the procedure at the meeting, including such regulation of the manner of voting and the conduct of discussion as seem to them to be in order.

**Section 6. Advance Notice Provisions for Business to be Transacted at Annual Meetings and Elections of Directors.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) At any annual meeting of the stockholders, unless otherwise required by law, only such business shall be conducted as shall have been brought before the meeting: (i) as specified in the Corporation's notice of the meeting; (ii) by or at the direction of the Board of Directors; or (iii) by any stockholder of the Corporation who (a) is a stockholder of record on the date such stockholder gives the notice provided for in this Section 6(a) and on the record date for the determination of stockholders entitled to vote at such annual meeting, and (b) complies with the notice procedures set forth in this Section 6(a). For business to be properly brought before an annual meeting by a stockholder pursuant to clause (iii) of the immediately preceding sentence, the stockholder must have given timely notice thereof in writing to the Secretary of the Corporation and such business must otherwise be a proper matter for action by stockholders.

To be timely, a stockholder's notice must be delivered or mailed to and received by the Secretary at the principal executive office of the Corporation not less than ninety (90) days nor more than one hundred (100) days before the anniversary of the prior year's annual meeting of stockholders; *provided*, *however,* that if the date of the annual meeting is advanced more than thirty (30) days before the anniversary of the prior year's annual meeting of stockholders, such written notice shall be timely only if delivered or mailed to and received by the Secretary of the Corporation at the principal executive office of the Corporation no earlier than the day on which public disclosure of the date of such annual meeting is first made and not later than the 10<sup>th</sup> day following the earlier of the day notice of the meeting was mailed to stockholders or such public disclosure was made.

With respect to the first annual meeting of stockholders of the Corporation following the Corporation becoming the sole stockholder of Mercer Savings Bank, notice by a stockholder shall be timely if delivered or mailed to and received by the Secretary of the Corporation not later than the close of business on the later of (i) the 100<sup>th</sup> day before the date of the annual meeting and (ii) the 10<sup>th</sup> day following the day on which public disclosure of the date of the annual meeting is first made.

The advance notice periods provided in this Section 6(a), once established by the initial notice or public disclosure of a date for the annual meeting of stockholders, shall remain in effect regardless of whether a subsequent notice or public disclosure shall provide that the meeting shall have been adjourned or that the date of the meeting shall have been postponed or otherwise changed from the date provided in the initial notice or public disclosure.

A stockholder's notice to the Secretary must set forth as to each matter such stockholder proposes to bring before the annual meeting: (i) a brief description of the business desired to be brought before the annual meeting and the reasons for conducting such business at the annual meeting; (ii) the name and address of such stockholder as they appear on the Corporation's books and of the beneficial owner, if any, on whose behalf the proposal is made; (iii) the class or series and number of shares of capital stock of the Corporation which are owned beneficially or of record by such stockholder and such beneficial owner; (iv) a description of all arrangements or understandings between such stockholder and any other person or persons (including their names) in connection with the proposal of such business by such stockholder and any material interest of such stockholder in such business; and (v) a representation that such stockholder intends to appear in person or by proxy at the annual meeting to bring such business before the meeting.

Notwithstanding anything in these Bylaws to the contrary, no business shall be brought before or conducted at an annual meeting except in accordance with the provisions of this Section 6(a). The chairperson of the meeting shall, if the facts so warrant, determine and declare to the meeting that business was not properly brought before the meeting in accordance with the provisions of this Section 6(a) and, if they should so determine, they shall so declare to the meeting and any such business so determined to be not properly brought before the meeting shall not be transacted.

At any special meeting of the stockholders, only such business shall be conducted as shall have been brought before the meeting pursuant to the Corporation's notice of the meeting.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Only persons who are nominated in accordance with the following procedures shall be eligible for election as directors of the Corporation. Nominations of persons for election to the Board of Directors of the Corporation may be made at a meeting of stockholders at which directors are to be elected only: (i) by or at the direction of the Board of Directors or (ii) by any stockholder of the Corporation who (1) is a stockholder of record on the date such stockholder gives the notice provided for in this Section 6(b) and on the record date for the determination of stockholders entitled to vote at such meeting and (2) complies with the notice procedures set forth in this Section 6(b) and the requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the rules and regulations promulgated thereunder. Such nominations, other than those made by or at the direction of the Board of Directors, shall be made by timely notice in writing to the Secretary of the Corporation.

To be timely, a stockholder's notice must be delivered or mailed to and received by the Secretary at the principal executive office of the Corporation not less than ninety (90) days nor more than one hundred (100) days before the anniversary of the prior year's annual meeting of stockholders; *provided*, *however,* that if the date of the annual meeting is advanced more than thirty (30) days before the anniversary of the prior year's annual meeting of stockholders, such written notice shall be timely only if delivered or mailed to and received by the Secretary of the Corporation at the principal executive office of the Corporation no earlier than the day on which public disclosure of the date of such annual meeting is first made and not later than the tenth (10<sup>th</sup>) day following the earlier of the day notice of the meeting was mailed to stockholders or such public disclosure was made.

With respect to the first annual meeting of stockholders of the Corporation following the Corporation becoming the sole stockholder of Mercer Savings Bank, notice by the stockholder shall be timely if delivered or mailed to and received by the Secretary of the Corporation not later than the close of business on the later of (i) the 100<sup>th</sup> day before the date of the annual meeting and (ii) the 10<sup>th</sup> day following the day on which public disclosure of the date of the annual meeting is first made.

The advance notice periods provided in this Section 6(b), once established by the initial notice or public disclosure of a date for the annual meeting of stockholders, shall remain in effect regardless of whether a subsequent notice or public disclosure shall provide that the meeting shall have been adjourned or that the date of the meeting shall have been postponed or otherwise changed from the date provided in the initial notice or public disclosure.

A stockholder's notice must be in writing and set forth (i) as to each person whom the stockholder proposes to nominate for election as a director, (a) all information relating to such person that would indicate such person's qualification to serve on the Board of Directors of the Corporation; (b) an affidavit that such person would not be disqualified under the provisions of Article II, Section 12 of these Bylaws; (c) such information relating to such person that is required to be disclosed in connection with solicitations of proxies for election of directors, or is otherwise required, in each case pursuant to Regulation 14A under the Exchange Act, or any successor rule or regulation; and (d) a written consent of each proposed nominee to be named as a nominee, including in proxy materials relating to the meeting to nominate the nominee(s), and to serve as a director if elected; and (ii) as to the stockholder giving the notice: (a) the name and address of such stockholder as they appear on the Corporation's books and of the beneficial owner, if any, on whose behalf the nomination is made; (b) the class or series and number of shares of capital stock of the Corporation which are owned beneficially or of record by such stockholder and such beneficial owner; (c) a description of all arrangements or understandings between such stockholder and each proposed nominee and any other person or persons (including their names) pursuant to which the nomination(s) are to be made by such stockholder; (d) a representation that such stockholder intends to appear in person or by proxy at the meeting to nominate the persons named in its notice; (e) whether such stockholder intends to solicit proxies in support of director nominees other than the Corporation's nominees in accordance with the Exchange Act and the rules and regulations promulgated thereunder; and (f) any other information relating to such stockholder that would be required to be disclosed in a proxy statement or other filings required to be made in connection with solicitations of proxies for election of directors pursuant to Regulation 14A under the Exchange Act or any successor rule or regulation. Upon request by the Corporation, if a stockholder provides notice of its intent to solicit proxies in support of director nominees other than the Corporation's nominees in accordance with the Exchange Act and the rules and regulations promulgated thereunder, the stockholder shall deliver to the Corporation, no later than five (5) business days prior to the applicable meeting of stockholders, reasonable evidence that it has met the requirements of the Exchange Act and the rules and regulations promulgated thereunder. No person shall be eligible for election as a director of the Corporation unless nominated in accordance with the provisions of this Section 6(b). The chairperson of the meeting shall, if the facts so warrant, determine that a nomination was not made in accordance with such provisions and, if they should so determine, they shall so declare to the meeting and the defective nomination shall be disregarded. Furthermore, unless otherwise required by law, if any stockholder (i) provides notice pursuant to Rule 14a-19(b) under the Exchange Act and (ii) subsequently fails to comply with any requirements of Rule 14a-19 under the Exchange Act or any other rules or regulations thereunder, then the Corporation shall disregard any proxies or votes solicited for such nominees and such nomination shall be disregarded.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) For purposes of subsections (a) and (b) of this Section 6, the term "public disclosure" shall mean disclosure (i) in a press release issued through a nationally-recognized news service, (ii) in a document publicly filed or furnished by the Corporation with the United States Securities and Exchange Commission or (iii) on a website maintained by the Corporation. The timely notice requirements provided in subsections (a) and (b) of this Section 6 shall apply to all stockholder nominations for election as a director and all stockholder proposals for business to be conducted at an annual meeting regardless of whether such proposal is submitted for inclusion in the Corporation's proxy materials pursuant to Rule 14a-8 of Regulation 14A under the Exchange Act or whether such nomination is submitted for inclusion in the Corporation's proxy materials pursuant to Rule 14a-19 of Regulation 14A under the Exchange Act.

**Section 7. Proxies and Voting.**

Unless the Articles of Incorporation provide for a greater or lesser number of votes per share or limits or denies voting rights, each outstanding share of capital stock, regardless of class, is entitled to one vote on each matter submitted to a vote at a meeting of stockholders; however, a share is not entitled to be voted if any installment payable on it is overdue and unpaid. In all elections for directors, directors shall be determined by a plurality of the votes cast, and except as otherwise required by law or as provided in the Articles of Incorporation, all other matters voted on by stockholders shall be determined by a majority of the votes cast on the matter.

A stockholder may vote the capital stock the stockholder owns of record either in person or by proxy. A stockholder may sign a writing authorizing another person to act as proxy. Signing may be accomplished by the stockholder or the stockholder's authorized agent signing the writing or causing the stockholder's signature to be affixed to the writing by any reasonable means, including facsimile signature. A stockholder may authorize another person to act as proxy by transmitting, or authorizing the transmission of, an authorization for the person to act as the proxy to the person authorized to act as proxy or to any other person authorized to receive the proxy authorization on behalf of the person authorized to act as the proxy, including a proxy solicitation firm or proxy support service organization. The authorization may be transmitted by electronic mail or any other electronic or telephonic means. Unless a proxy provides otherwise, a proxy is not valid more than 11 months after its date. A proxy is revocable by a stockholder at any time without condition or qualification unless the proxy states that it is irrevocable and the proxy is coupled with an interest. A proxy may be made irrevocable for as long as it is coupled with an interest. The interest with which a proxy may be coupled includes an interest in the capital stock to be voted under the proxy or another general interest in the Corporation or its assets or liabilities.

**Section 8. Conduct of Voting**

The Board of Directors shall, in advance of any meeting of stockholders, appoint one or more persons as inspectors of election, to act at the meeting or any adjournment thereof and make a written report thereof, in accordance with applicable law. If one or more inspectors are not so elected, the chairperson of the meeting shall make such appointment at the meeting of stockholders. At all meetings of stockholders, the proxies and ballots shall be received, and all questions relating to the qualification of voters and the validity of proxies and the acceptance or rejection of votes shall be decided or determined by the inspector of election. All voting, including on the election of directors but excepting where otherwise required by law, may be by a voice vote; provided, however, that upon demand therefor by a stockholder entitled to vote or their proxy or the chairperson of the meeting, a written vote shall be taken. Every written vote shall be taken by ballot, each of which shall state the name of the stockholder or proxy voting and such other information as may be required under the procedure established for the meeting. No candidate for election as a director at a meeting shall serve as an inspector at such meeting.

**Section 9. Control Share Acquisition Act.**

Notwithstanding any other provision of the Articles of Incorporation or these Bylaws, Title 3, Subtitle 7 of the MGCL (or any successor statute) shall not apply to any acquisition by any person of shares of capital stock of the Corporation. This Section 9 may be repealed by a majority of the Whole Board, in whole or in part, at any time, whether before or after an acquisition of Control Shares (as defined in Section 3-701(d) of the MGCL, or any successor provision) and, upon such repeal, may, to the extent provided by any successor bylaw, apply to any prior or subsequent Control Share Acquisition (as defined in Section 3-701(d) of the MGCL, or any successor provision).

**ARTICLE II<br> BOARD OF DIRECTORS**

**Section 1. General Powers, Number and Term of Office.**

The business and affairs of the Corporation shall be managed under the direction of the Board of Directors. The number of directors of the Corporation shall, by virtue of the Corporation's election made hereby to be governed by Section 3-804(b) of the MGCL, be fixed from time to time exclusively by vote of the Board of Directors; provided, however, that such number shall never be less than the minimum number of directors required by the MGCL now or hereafter in force. The Board of Directors shall annually elect a Chairperson of the Board from among its members and shall designate the Chairperson of the Board or their designee to preside at its meetings. The Board of Directors may also annually elect a Vice Chairperson. In the absence of the Chairperson of the Board, the Vice Chairperson of the Board shall preside at the meetings of the Board of Directors, and in their absence such other person as may be designated by a majority of the Whole Board shall preside at the meetings of the Board of Directors.

The directors, other than those who may be elected by the holders of any series of preferred stock of the Corporation, shall be divided into three classes, as nearly equal in number as reasonably possible, with the term of office of the first class to expire at the first annual meeting of stockholders, the term of office of the second class to expire at the annual meeting of stockholders one year thereafter and the term of office of the third class to expire at the annual meeting of stockholders two years thereafter, with each director to hold office until their successor shall have been duly elected and qualified. At each annual meeting of stockholders, commencing with the first annual meeting, directors elected to succeed those directors whose terms expire shall be elected for a term of office to expire at the third succeeding annual meeting of stockholders after their election or for such shorter period of time as the Board of Directors may determine, with each director to hold office until their successor shall have been duly elected and qualified.

**Section 2. Vacancies and Newly Created Directorships.**

By virtue of the Corporation's election made hereby to be subject to Section 3-804(c) of the MGCL, any vacancies in the Board of Directors resulting from an increase in the size of the Board of Directors or the death, resignation or removal of a director may be filled only by the affirmative vote of two-thirds (2/3) of the remaining directors in office, even if the remaining directors do not constitute a quorum, and any director elected to fill a vacancy shall hold office for the remainder of the full term of the class of directors in which the vacancy occurred and until a successor is elected and qualifies. No decrease in the number of directors constituting the Board of Directors shall shorten the term of any incumbent director.

**Section 3. Regular Meetings.**

Regular meetings of the Board of Directors shall be held at such place or places or by means of remote communication, on such date or dates, and at such time or times as shall have been established by the Board of Directors and publicized among all directors. A notice of each regular meeting shall not be required. Any regular meeting of the Board of Directors may adjourn from time to time to reconvene at the same or some other place, and no notice need be given of any such adjourned meeting other than by announcement.

**Section 4. Special Meetings.**

Special meetings of the Board of Directors may be called by one-third (1/3) of the directors then in office (rounded up to the nearest whole number), by the Chairperson of the Board, by the Vice Chairperson of the Board or by the Chief Executive Officer, and shall be held at such place or by means of remote communication, on such date, and at such time as they or they shall fix. Notice of the place, date, and time of each such special meeting shall be given to each director who has not waived notice by mailing and post-marking written notice not less than five (5) days before the meeting, or by facsimile or other electronic transmission of the same not less than twenty four (24) hours before the meeting. Any director may waive notice of any special meeting, either before or after such meeting, by delivering a written waiver or a waiver by electronic transmission that is filed with the records of the meeting. Attendance of a director at a special meeting shall constitute a waiver of notice of such meeting, except where the director attends the meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted nor the purpose of any special meeting of the Board of Directors need be specified in the notice of such meeting. Any special meeting of the Board of Directors may adjourn from time to time to reconvene at the same or some other place, and no notice need be given of any such adjourned meeting other than by announcement.

**Section 5. Quorum.**

At any meeting of the Board of Directors, a majority of the Whole Board shall constitute a quorum for all purposes. If a quorum shall fail to attend any meeting, a majority of those present may adjourn the meeting to another place, date, or time, without further notice or waiver thereof.

**Section 6. Participation in Meetings By Conference Telephone or by Other Electronic Communications Equipment.**

Members of the Board of Directors, or of any committee thereof, may participate in a meeting of such Board or committee by means of a conference telephone or by means of other electronic communications equipment if all persons participating in the meeting can hear each other at the same time. Such participation shall constitute presence in person at such meeting.

**Section 7. Conduct of Business.**

At any meeting of the Board of Directors, business shall be transacted in such order and manner as the Board may from time to time determine, and all matters shall be determined by the vote of a majority of the directors present, except as otherwise provided in these Bylaws or the Articles of Incorporation or required by law. Action may be taken by the Board of Directors without a meeting if a unanimous consent which sets forth the action is given in writing or by electronic transmission by each member of the Board of Directors and filed in paper or electronic form with the minutes of proceedings of the Board of Directors.

**Section 8. Powers.**

All powers of the Corporation may be exercised by or under the authority of the Board of Directors except as provided by the Articles of Incorporation. Consistent with the foregoing, the Board of Directors shall have, among other powers, the unqualified power:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) To declare dividends from time to time in accordance with law;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) To purchase or otherwise acquire any property, rights or privileges on such terms as it shall determine;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) To authorize the creation, making and issuance, in such form as it may determine, of written obligations of every kind, negotiable
or non-negotiable, secured or unsecured, and to do all things necessary in connection therewith;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) To remove any officer of the Corporation with or without cause, and from time to time to devolve the powers and duties of any officer
upon any other person for the time being;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) To confer upon any officer of the Corporation the power to appoint, remove and suspend subordinate officers, employees and agents;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) To adopt from time to time such stock, option, stock purchase, bonus or other compensation plans for directors, officers, employees
and agents of the Corporation and its subsidiaries as it may determine;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) To adopt from time to time such insurance, retirement, and other benefit plans for directors, officers, employees and agents of the
Corporation and its subsidiaries as it may determine; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) To adopt from time to time regulations, not inconsistent with these Bylaws, for the management of the Corporation's business
and affairs.

**Section 9. Compensation of Directors.**

Directors, as such, may receive, pursuant to resolution of the Board of Directors, fixed fees and other compensation for their services as directors, including, without limitation, their services as members of committees of the Board of Directors.

**Section 10. Resignation.**

Any director may resign at any time by giving written notice of such resignation to the Chairperson, the President or the Secretary at the principal office of the Corporation. Unless otherwise specified therein, such resignation shall take effect upon receipt thereof.

**Section 11. Presumption of Assent.**

A director of the Corporation who is present at a meeting of the Board of Directors at which action on any corporate matter is taken shall be presumed to have assented to such action unless such director announces their dissent at the meeting and (a) such director's dissent is entered in the minutes of the meeting, (b) such director files their written dissent to such action with the secretary of the meeting before the adjournment thereof, or (c) such director forwards their written dissent within twenty four (24) hours after the meeting is adjourned, by certified mail, return receipt requested, bearing a postmark from the United States Postal Service, to the secretary of the meeting or the Secretary of the Corporation. Such right to dissent shall not apply to a director who voted in favor of such action or failed to make their dissent known at the meeting.

**Section 12. Director Qualifications.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) No person shall be eligible for election or appointment to the Board of Directors: (i) if a financial or securities regulatory agency has, within the past ten years, issued a cease and desist, consent or other formal order, other than a civil money penalty, against such person, which order is subject to public disclosure by such agency; (ii) if such person has been convicted of a crime involving dishonesty or breach of trust which is punishable by imprisonment for a term exceeding one year under state or federal law; (iii) if such person is currently charged in any information, indictment, or other complaint with the commission of or participation in such a crime; or (iv) other than the persons appointed as initial directors in connection with the formation of the Corporation and other than persons who are also executive officers of the Corporation or of the Corporation's banking subsidiary, Mercer Savings Bank, if such person did not, at the time of their first election or appointment to the Board of Directors, maintain their principal residence (as determined by reference to such person's most recent tax returns, copies of which shall be provided to the Corporation for the sole purpose of determining compliance with this clause (iv)) within a county in which the Corporation or any subsidiary thereof maintains an office (including a loan production office), or in any county contiguous to a county in which the Corporation or any subsidiary thereof maintains an office (including a loan production office) for a period of at least one (1) year before the date of their purported nomination, election or appointment to the Board of Directors. No person may serve on the Board of Directors if such person is: (w) at the same time, a director, officer, employee or 10% or more stockholder of a bank, savings institution, credit union, mortgage banking company, consumer loan company or similar organization, other than a subsidiary of the Corporation, that engages in financial services related business activities or solicits customers, whether through a physical presence or electronically, in the same market area as the Corporation or any of its subsidiaries; (x) does not agree in writing to comply with all of the Corporation's policies applicable to directors including but not limited to its confidentiality policy and confirm in writing their qualifications hereunder; (y) is a party to any agreement, understanding or arrangement with a party other than the Corporation or a subsidiary that (1) provides them with material benefits which are tied to or contingent on the Corporation entering into a merger, sale of control or similar transaction in which it is not the surviving institution, (2) materially limits their voting discretion as a member of the Board of Directors of the Corporation, or (3) materially impairs their ability to discharge their fiduciary duties with respect to the fundamental strategic direction of the Corporation; or (z) has lost more than one election for service as a director of the Corporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) No person seventy (70) years of age or older shall be eligible for election, reelection, appointment, or reappointment as a director of the Corporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The Board of Directors shall have the power to construe and apply the provisions of this Section 12 and to make all determinations necessary or desirable to implement such provisions.

**Section 13. Attendance at Board Meetings.**

The Board of Directors shall have the right to remove any director from the board upon a director's unexcused absence from (i) three consecutive regularly scheduled meetings of the Board of Directors, or (ii) three regularly scheduled meetings of the Board of Directors in any fiscal year of the Corporation.

**ARTICLE III<br> COMMITTEES**

**Section 1. Committees of the Board of Directors.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) *General Provisions.* The Board of Directors may appoint from among its members an audit committee, a compensation committee, a nominating and corporate governance committee, and such other committees as the Board of Directors deems necessary or desirable. The Board of Directors may delegate to any committee so appointed any of the powers and authorities of the Board of Directors to the fullest extent permitted by the MGCL and any other applicable law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) *Composition.* Each committee shall be composed of one or more directors or any other number of members specified in these Bylaws or required by applicable regulations or stock exchange rules. The Chairperson of the Board may recommend committees, committee memberships, and committee chairs to the Board of Directors. The Board of Directors shall have the power at any time to appoint the chairperson and the members of any committee, change the membership of any committee, to fill all vacancies on committees, to designate alternate members to replace or act in the place of any absent or disqualified member of a committee, or to dissolve any committee. A member of a committee may resign from that committee at any time by giving written notice of such resignation to the Chairperson of the Board. Unless otherwise specified therein, such resignation from the committee shall take effect upon receipt thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) *Issuance of Capital Stock.* If the Board of Directors has given general authorization for the issuance of capital stock providing for or establishing a method or procedure for determining the maximum number of shares to be issued, a committee of the Board of Directors, in accordance with that general authorization or any stock option or other plan or program adopted by the Board of Directors, may authorize or fix the terms of stock subject to classification or reclassification and the terms on which any capital stock may be issued, including all terms and conditions required or permitted to be established or authorized by the Board of Directors. Any committee so designated may exercise the power and authority of the Board of Directors if the resolution that designated the committee or a supplemental resolution of the Board of Directors shall so provide.

**Section 2. Conduct of Business.**

Each committee may determine the procedural rules for meeting and conducting its business and shall act in accordance therewith, except as otherwise provided herein or required by law. Adequate provision shall be made for notice to members of all meetings; one-third (1/3) of the members shall constitute a quorum unless the committee shall consist of one or two members, in which event one member shall constitute a quorum; and all matters shall be determined by a majority vote of the members present. Action may be taken by any committee without a meeting if a unanimous consent which sets forth the action is given in writing or by electronic transmission by each member of the committee and filed in paper or electronic form with the minutes of the proceedings of such committee. The members of any committee may conduct any meeting thereof by conference telephone or other communications equipment in accordance with the provisions of Section 6 of Article II.

**ARTICLE IV<br> OFFICERS**

**Section 1. Generally.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Board of Directors as soon as may be practicable after the annual meeting of stockholders shall choose a Chairperson of the Board, a President, a Secretary and a Chief Financial Officer/Treasurer and from time to time may choose such other officers as it may deem proper. Any number of offices may be held by the same person, except that no person may concurrently serve as both President and Vice President of the Corporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The term of office of all officers shall be until the next annual election of officers and until their respective successors are chosen, but any officer may be removed from office at any time by the affirmative vote of a majority of the Whole Board.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) All officers chosen by the Board of Directors shall each have such powers and duties as generally pertain to their respective offices, subject to the specific provisions of this Article IV. Such officers shall also have such powers and duties as from time to time may be conferred by the Board of Directors or by any committee thereof.

**Section 2. Chairperson of the Board of Directors.**

The Chairperson of the Board of Directors of the Corporation shall perform all duties and have all powers which are commonly incident to the office of Chairperson of the Board or which are delegated to them by the Board of Directors. They shall have power to sign all stock certificates, contracts and other instruments of the Corporation that are authorized.

**Section 3. Vice Chairperson of the Board of Directors.**

If appointed, the Vice Chairperson of the Board of Directors of the Corporation shall perform all duties and have all powers which are commonly incident to the office of Chairperson of the Board, with such duties to be performed and powers to be held in the absence of the Chairperson of the Board, or which are delegated to them by the Board of Directors.

**Section 4. Chief Executive Officer.**

If appointed, the Chief Executive Officer, subject to the control of the Board of Directors, shall serve in general executive capacity and have general power over the management and oversight of the administration and operation of the Corporation's business and general supervisory power and authority over its policies and affairs. The Chief Executive Officer shall see that all orders and resolutions of the Board of Directors and of any committee thereof are carried into effect.

**Section 5. President.**

The President shall perform the duties of the Chief Executive Officer in the Chief Executive Officer's absence or during their disability to act. In addition, the President shall perform the duties and exercise the powers usually incident to their respective office and/or such other duties and powers as may be properly assigned to the President from time to time by the Board of Directors, the Chairperson of the Board or the Chief Executive Officer.

**Section 6. Vice President.**

The Vice President or Vice Presidents (including Executive Vice Presidents or other levels of Vice President designated by the Board of Directors), if any, shall perform the duties of the Chief Executive Officer in the absence of both the Chief Executive Officer and the President, or during their disability to act. In addition, the Vice Presidents shall perform the duties and exercise the powers usually incident to their respective office and/or such other duties and powers as may be properly assigned to the Vice Presidents from time to time by the Board of Directors, the Chairperson of the Board or the Chief Executive Officer.

**Section 7. Secretary.**

The Secretary or an Assistant Secretary shall issue notices of meetings, shall keep the minutes of meetings, shall have charge of the seal and the corporate books, shall perform such other duties and exercise such other powers as are usually incident to such offices and/or such other duties and powers as are properly assigned thereto by the Board of Directors, the Chairperson of the Board or the Chief Executive Officer.

**Section 8. Chief Financial Officer/Treasurer.**

The Chief Financial Officer/Treasurer shall have charge of all monies and securities of the Corporation, other than monies and securities of any division of the Corporation that has a treasurer or financial officer appointed by the Board of Directors, and shall keep regular books of account. The funds of the Corporation shall be deposited in the name of the Corporation by the Chief Financial Officer/Treasurer with such banks or trust companies or other entities as the Board of Directors from time to time shall designate. The Chief Financial Officer/Treasurer shall sign or countersign such instruments as require their signature, shall perform all such duties and have all such powers as are usually incident to such office and/or such other duties and powers as are properly assigned to them by the Board of Directors, the Chairperson of the Board or the Chief Executive Officer, and may be required to give bond for the faithful performance of their duties in such sum and with such surety as may be required by the Board of Directors.

**Section 9. Other Officers.**

The Board of Directors may designate and fill such other offices in its discretion and the persons holding such other offices shall have such powers and shall perform such duties as the Board of Directors or Chief Executive Officer may from time to time assign.

**Section 10. Action with Respect to Securities of Other Corporations.**

Securities of other corporations or associations registered in the name of the Corporation may be voted by the Chief Executive Officer, the President, a Vice President, or a proxy appointed by either of them. The Board of Directors, however, may by resolution appoint some other person to vote such shares, in which case such person shall be entitled to vote such shares upon the production of a certified copy of such resolution.

**ARTICLE V<br> STOCK**

**Section 1. Certificates of Stock.**

The Board of Directors may determine to issue certificated or uncertificated shares of capital stock and other securities of the Corporation. For certificated stock, each stockholder is entitled to certificates which represent and certify the shares of stock the stockholder holds in the Corporation. Each stock certificate shall include on its face the name of the Corporation, the name of the stockholder or other person to whom it is issued, and the class of stock and number of shares it represents. It shall also include on its face or back (a) a statement of any restrictions on transferability and a statement of the designations and any preferences, conversion and other rights, voting powers, restrictions, limitations as to dividends, qualifications, and terms and conditions of redemption of the stock of each class which the Corporation is authorized to issue, of the differences in the relative rights and preferences between the shares of each series of preferred stock which the Corporation is authorized to issue, to the extent they have been set, and of the authority of the Board of Directors to set the relative rights and preferences of subsequent series of preferred stock or (b) a statement which provides in substance that the Corporation will furnish a full statement of such information to any stockholder on request and without charge. Such request may be made to the Secretary or to the Corporation's transfer agent. Upon the issuance of uncertificated shares of capital stock, the Corporation shall send the stockholder a written statement of the same information required above with respect to stock certificates. Each stock certificate shall be in such form, not inconsistent with law or with the Articles of Incorporation, as shall be approved by the Board of Directors or any officer or officers designated for such purpose by resolution of the Board of Directors. Each stock certificate shall be signed by the Chairperson of the Board, the President, or a Vice-President, and countersigned by the Secretary, an Assistant Secretary, the Treasurer, or an Assistant Treasurer. Each certificate may be sealed with the actual corporate seal or a facsimile of it or in any other form and the signatures may be either manual or facsimile signatures. A certificate is valid and may be issued whether or not an officer who signed it is still an officer when it is issued. A certificate may not be issued until the stock represented by it is fully paid.

**Section 2. Transfers of Stock.**

Transfers of capital stock shall be made only upon the transfer books of the Corporation kept at an office of the Corporation or by transfer agents designated to transfer shares of the capital stock of the Corporation. Except where a certificate is issued in accordance with Section 4 of Article V of these Bylaws, an outstanding certificate for the number of shares involved shall be surrendered for cancellation before a new certificate is issued therefor.

**Section 3. Record Dates or Closing of Transfer Books.**

The Board of Directors may, and shall have the power to, set a record date or direct that the stock transfer books be closed for a stated period for the purpose of making any proper determination with respect to stockholders, including which stockholders are entitled to notice of a meeting, vote at a meeting, receive a dividend, or be allotted other rights. The record date may not be before the close of business on the day the record date is fixed nor, subject to Section 3 of Article I of these Bylaws, more than ninety (90) days before the date on which the action requiring the determination will be taken; the transfer books may not be closed for a period longer than twenty (20) days; and, in the case of a meeting of stockholders, the record date or the closing of the transfer books shall be at least ten (10) days before the date of the meeting. Any shares of the Corporation's own stock acquired by the Corporation between the record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders and the time of the meeting may be voted at the meeting by the holder of record as of the record date and shall be counted in determining the total number of outstanding shares entitled to be voted at the meeting.

**Section 4. Lost, Stolen or Destroyed Certificates.**

The Board of Directors of the Corporation may determine the conditions for issuing a new stock certificate in place of one which is alleged to have been lost, stolen, or destroyed, or the Board of Directors may delegate such power to any officer or officers of the Corporation or to the transfer agent designated to transfer shares of the stock of the Corporation. In their discretion, the Board of Directors or such officer or officers may require the owner of the certificate to give a bond, with sufficient surety, to indemnify the Corporation against any loss or claim arising as a result of the issuance of a new certificate. In their discretion, the Board of Directors or such officer or officers may refuse to issue such new certificate without the order of a court having jurisdiction over the matter.

**Section 5. Stock Ledger.**

The Corporation shall maintain a stock ledger which contains the name and address of each stockholder and the number of shares of stock of each class which the stockholder holds. The stock ledger may be in written form or in any other form which can be converted within a reasonable time into written form for visual inspection. The original or a duplicate of the stock ledger shall be kept at the offices of a transfer agent for the particular class of stock or, if none, at the principal executive office of the Corporation.

**Section 6. Regulations.**

The issue, transfer, conversion and registration of certificates of stock shall be governed by such other regulations as the Board of Directors may establish.

**ARTICLE VI<br> MISCELLANEOUS**

**Section 1. Facsimile Signatures.**

In addition to the provisions for use of facsimile signatures elsewhere specifically authorized in these Bylaws, facsimile signatures of any officer or officers of the Corporation may be used whenever and as authorized by the Board of Directors or a committee thereof.

**Section 2. Corporate Seal.**

The Board of Directors may provide a suitable seal, bearing the name of the Corporation, which shall be in the charge of the Secretary. The Board of Directors may authorize one or more duplicate seals and provide for the custody thereof. If the Corporation is required to place its corporate seal to a document, it is sufficient to meet the requirement of any law, rule, or regulation relating to a corporate seal to place the word "(seal)" adjacent to the signature of the person authorized to sign the document on behalf of the Corporation.

**Section 3. Books and Records.**

The Corporation shall keep correct and complete books and records of its accounts and transactions and minutes of the proceedings of its stockholders and Board of Directors and of any committee when exercising any of the powers of the Board of Directors. The books and records of the Corporation may be in written form or in any other form which can be converted within a reasonable time into written form for visual inspection. Minutes shall be recorded in written form but may be maintained in the form of a reproduction. The original or a certified copy of these Bylaws shall be kept at the principal office of the Corporation.

**Section 4. Reliance Upon Books, Reports and Records.**

Each director, each member of any committee designated by the Board of Directors, and each officer and agent of the Corporation shall, in the performance of their duties, in addition to any protections conferred upon them by law, be fully protected in relying in good faith upon the books of account or other records of the Corporation and upon such information, opinions, reports or statements presented to the Corporation by any of its officers or employees, or committees of the Board of Directors so designated, or by any other person as to matters which such director, committee member, officer or agent reasonably believes are within such other person's professional or expert competence and who has been selected with reasonable care by or on behalf of the Corporation.

**Section 5. Fiscal Year.**

The fiscal year of the Corporation shall commence on the first day of January and end on the last day of December in each year.

**Section 6. Time Periods.**

In applying any provision of these Bylaws that requires that an act be done or not be done a specified number of days before an event or that an act be done during a period of a specified number of days before an event, calendar days shall be used, the day of the doing of the act shall be excluded and the day of the event shall be included.

**Section 7. Checks, Drafts, Etc.**

All checks, drafts and orders for the payment of money, notes and other evidences of indebtedness, issued in the name of the Corporation, shall be signed by any officer, employee or agent of the Corporation that is authorized by the Board of Directors.

**Section 8. Mail.**

Any notice or other document that is required by these Bylaws to be mailed shall be deposited in the United States mail, postage prepaid.

**Section 9. Contracts and Agreements.**

To the extent permitted by applicable law, and except as otherwise prescribed by the Articles of Incorporation or these Bylaws, the Board of Directors may authorize any officer, employee or agent of the Corporation to enter into any contract or execute and deliver any instrument in the name of and on behalf of the Corporation. Such authority may be general or confined to specific instances. A person who holds more than one office in the Corporation may not act in more than one capacity to execute, acknowledge, or verify an instrument required by law to be executed, acknowledged, or verified by more than one officer.

**ARTICLE VII<br> AMENDMENTS**

These Bylaws may be adopted, amended or repealed as provided in the Articles of Incorporation.

\# \# \#

Adopted: March 7, 2023

## Ex-4

**Exhibit 4**

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| | | |
|:---|:---|:---|
| ![](tm238570d1_ex4-img01.jpg) | **MERCER BANCORP, INC.<br>**INCORPORATED UNDER THE LAWS OF THE STATE OF MARYLAND** | ![](tm238570d1_ex4-img02.jpg) |
|  |  | **CUSIP:** |

---

THE SHARES REPRESENTED BY THIS

CERTIFICATE ARE SUBJECT TO

RESTRICTIONS, SEE REVERSE SIDE

THIS CERTIFIES that is the owner of

FULLY-PAID AND NON-ASSESSABLE SHARES OF COMMON STOCK, PAR VALUE $0.01 PER SHARE

The shares evidenced by this certificate are transferable only on the books of Mercer Bancorp, Inc. by the holder hereof, in person or by attorney, upon surrender of this certificate properly endorsed. **The capital stock evidenced hereby is not an account of an insurable type and is not insured by the Federal Deposit Insurance Corporation or any other Federal or state governmental agency.**

IN WITNESS WHEREOF, Mercer Bancorp, Inc. has caused this certificate to be executed by the facsimile signatures of its duly authorized officers and has caused a facsimile of its seal to be hereunto affixed.

Dated: ________________, 2023

By:   [SEAL] By:   <br> Jose W. Faller Alvin B. Parmiter <br> Corporate Secretary President and Chief Executive Officer

The Board of Directors of Mercer Bancorp, Inc. (the "Company") is authorized by resolution or resolutions, from time to time adopted, to provide for the issuance of more than one class of stock, including preferred stock in series, and to fix and state the voting powers, designations, preferences, limitations and restrictions thereof. The Company will furnish to any stockholder upon request and without charge a full description of each class of stock and any series thereof.

The shares evidenced by this certificate are subject to a limitation contained in the Articles of Incorporation to the effect that in no event shall any record owner of any outstanding common stock which is beneficially owned, directly or indirectly, by a person who beneficially owns in excess of 10% of the outstanding shares of common stock (the "Limit") be entitled or permitted to any vote in respect of shares held in excess of the Limit.

The shares represented by this certificate may not be cumulatively voted on any matter. The Articles of Incorporation requires that, with limited exceptions, no amendment, addition, alteration, change or repeal of the Articles of Incorporation shall be made, unless such is first approved by the Board of Directors of the Company and approved by the stockholders by a majority of the total shares entitled to vote, or in certain circumstances approved by the affirmative vote of up to 80% of the shares entitled to vote.

The following abbreviations when used in the inscription on the face of this certificate shall be construed as though they were written out in full according to applicable laws or regulations.

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| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;TEN COM | - as tenants in common | UNIF GIFT MIN ACT | - _________ Custodian __________ |
|  |  |  | *(Cust) (Minor)* |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;TEN ENT | - as tenants by the entireties |  |  |
|  |  |  | Under Uniform Gifts to Minors Act |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;JT TEN | - as joint tenants with right |  |  |
|  | of survivorship and not as |  | |
|  | tenants in common |  | *(State)* |

---

Additional abbreviations may also be used though not in the above list

For value received,<u> </u> hereby sell, assign and transfer unto

PLEASE INSERT SOCIAL SECURITY NUMBER OR OTHER IDENTIFYING NUMBER

*(please print or typewrite name and address including postal zip code of assignee)*

------

___________________________________________________________________________________ Shares of the Common Stock represented by the within Certificate, and do hereby irrevocably constitute and appoint _________________________________________________________________ Attorney to transfer the said shares on the books of the within named corporation with full power of substitution in the premises.

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| | |
|:---|:---|
| Dated, ___________________________ |  |
| In the presence of | Signature: |

---

NOTE: THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME OF THE STOCKHOLDER(S) AS WRITTEN UPON THE FACE OF THE CERTIFICATE, IN EVERY PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT, OR ANY CHANGE WHATSOEVER.

## Ex-5

**Exhibit 5**

**LUSE GORMAN, PC**

ATTORNEYS AT LAW

5335 Wisconsin Avenue, NW, Suite 780

Washington, D.C. 20015

Telephone (202) 274-2000

Facsimile (202) 362-2902

www.luselaw.com

March 10, 2023

The Board of Directors

Mercer Bancorp, Inc.

1100 Irmscher Blvd

Celina, Ohio 45822

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| | |
|:---|:---|
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Re:** | **Mercer Bancorp, Inc.** |
|  | **<u>Common Stock, Par Value $0.01 Per Share</u>** |

---

Ladies and Gentlemen:

You have requested the opinion of this firm as to certain matters in connection with the offer, sale and issuance of the shares of common stock, par value $0.01 per share ("Common Stock"), of Mercer Bancorp, Inc. (the "Company").

We have reviewed the Company's Articles of Incorporation and its Registration Statement on Form S-1 (the "Form S-1"), the Plan of Conversion of Mercer Savings Bank (the "Plan"), and applicable statutes and regulations governing the Company and the offer, sale and issuance of the Common Stock. The opinion expressed below is limited to the laws of the State of Maryland (which includes applicable provisions of the Maryland General Corporation Law, the Maryland Constitution and reported judicial decisions interpreting the Maryland General Corporation Law and the Maryland Constitution).

We are of the opinion that upon the declaration of effectiveness of the Form S-1, the Common Stock, when issued and sold in accordance with the Plan, will be legally issued, fully paid and non-assessable.

This opinion has been prepared solely for the use of the Company in connection with the preparation and filing of the Form S-1, and shall not be used for any other purpose without our prior express written consent. We hereby consent to our firm being referenced under the caption "Legal Matters" in the Prospectus contained in the Form S-1 and to the filing of this opinion as an exhibit to the Form S-1. By giving such consent, we do not hereby admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act of 1933, as amended.

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| |
|:---|
| Very truly yours, |
| /s/ Luse Gorman, PC |
| Luse Gorman, PC |

---

## Exhibit 8.1

**Exhibit 8.1**

**LUSE GORMAN, PC**

**ATTORNEYS AT LAW**

**5335 WISCONSIN AVENUE, N.W., SUITE 780**

**WASHINGTON, D.C. 20015**

**TELEPHONE (202) 274-2000**

**FACSIMILE (202) 362-2902**

**<u>www.luselaw.com</u>**

March 7, 2023

Board of Directors

Mercer Savings Bank

1100 Irmscher Boulevard

Celina, Ohio 45822

Board of Directors:

You have requested this firm's opinion regarding the material federal income tax consequences of the proposed conversion (the "<u>Conversion</u>") of Mercer Savings Bank (the "<u>Bank</u>") from an Ohio-chartered mutual bank to an Ohio-chartered stock bank ("<u>Stock Bank</u>"), pursuant to a Plan of Conversion of Mercer Savings Bank adopted by the Board of Directors of the Bank on March 3, 2023 (the "<u>Plan</u>"). In the Conversion, all of the Bank's to-be-issued stock will be acquired by Mercer Bancorp, Inc., a Maryland corporation (the "<u>Holding Company</u>"). All capitalized terms used but not defined herein shall have the same meaning as set forth in the Plan.

For purposes of this opinion, we have examined such documents and questions of law as we have considered necessary or appropriate, including but not limited to: (1) the Holding Company's Registration Statement on Form S-1 filed with the Securities and Exchange Commission under the Securities Act of 1933, as amended (the "<u>Registration Statement</u>") relating to the proposed issuance of up to 1,719,250 shares (at the adjusted maximum of the offering range) of common stock, par value $0.01 per share; (2) applications or notices for approval/non-objection of the Conversion and the formation of a new bank holding company filed with the Ohio Division of Financial Institutions, the Federal Deposit Insurance Corporation and the Board of Governors of the Federal Reserve System (the "<u>Applications</u>"); (3) the Plan; (4) the Articles of Incorporation and Bylaws of the Bank; and (5) the Articles of Incorporation and Bylaws of the Holding Company. We have also relied upon, without independent verification, the representations of the Bank contained in its letter to us dated as of the date hereof. We have assumed and have not independently verified the authenticity of all original documents, the accuracy of all copies, and the genuineness of all signatures. We have further assumed the absence of adverse facts not apparent from the face of the instruments and documents we examined.

In issuing our opinion, we have assumed that the Bank will comply with the terms and conditions of the Plan, and that the various representations and warranties that are provided to us are accurate, complete, true and correct. Accordingly, we express no opinion concerning the effect, if any, of variations from the foregoing. We specifically express no opinion concerning tax matters relating to the Plan under state and local tax laws and under federal income tax laws except on the basis of the documents and assumptions described above.

Board of Directors

Mercer Savings Bank

March 7, 2023

In issuing the opinion set forth below, we have relied solely on existing provisions of the Internal Revenue Code of 1986, as amended (the "<u>Code</u>"), existing and proposed Treasury regulations (the "<u>Regulations</u>") thereunder, current administrative rulings, notices and procedures, and court decisions. These laws, regulations, administrative rulings, notices and procedures and court decisions are subject to change at any time. Any such change could affect the continuing validity of the opinions set forth below. These opinions are as of the date hereof, and we disclaim any obligation to advise you of any change in any matter considered herein after the date hereof.

In rendering our opinions, we have assumed that the persons and entities identified in the Plan will at all times comply with applicable state and federal laws and the factual representations of the Bank. In addition, we have assumed that the activities of the persons and entities identified in the Plan will be conducted strictly in accordance with the Plan. Any variations may affect the opinions we are rendering. For purposes of this opinion letter, we are relying on the factual representations provided to us by the Bank, which are incorporated herein by reference.

We emphasize that the outcome of litigation cannot be predicted with certainty and, although we have attempted in good faith to opine as to the probable outcome of the merits of each tax issue with respect to which an opinion was requested, there can be no assurance that our conclusions are correct or that they would be adopted by the Internal Revenue Service or a court.

**<u>BACKGROUND</u>**

The Bank is a mutual bank organized under the laws of the State of Ohio that is in the process of converting to an Ohio-chartered stock bank. As an Ohio-chartered mutual bank, the Bank has no authorized capital stock. Instead, the Bank, in mutual form, has a unique equity structure. A depositor in the Bank is entitled to payment of interest on his or her account balance as declared and paid by the Bank. A depositor has no right to a distribution of any earnings of the Bank, except for interest paid on the deposit balance, and such earnings become retained earnings of the Bank. However, a depositor has a pro-rata ownership interest in the net worth of the Bank based upon the deposit balance in his or her account. This interest may only be realized in the event of a complete liquidation of the Bank. A depositor who reduces or closes his or her deposit account with the Bank receives solely the balance of his or her deposit account. In connection with and at the time of the Conversion, Eligible Account Holders and, if applicable, Supplemental Eligible Account Holders will exchange their liquidation rights in the Bank for an interest in a liquidation account ("<u>Liquidation Account</u>") established at the Stock Bank.

Board of Directors

Mercer Savings Bank

March 7, 2023

**<u>PROPOSED TRANSACTION</u>**

The Holding Company has been formed under the laws of the State of Maryland for the purpose of the proposed transactions described herein, to engage in business as a bank holding company and to hold all of the stock of the Stock Bank. The Holding Company will issue shares of its voting common stock ("<u>Common Stock</u>"), upon completion of the mutual-to-stock conversion of the Bank, to persons purchasing such shares as described in greater detail below.

Following regulatory approval, the Plan provides for the offer and sale of shares of Common Stock in a Subscription Offering pursuant to nontransferable subscription rights on the basis of the following preference categories: (1) Eligible Account Holders; (2) the Bank's tax-qualified employee stock benefit plans, including the newly formed employee stock ownership plan; if applicable, (3) Supplemental Eligible Account Holders; and (4) Other Members, all as described in the Plan. The amount of shares at the minimum of the offering range must be sold. If shares remain after all orders are filled in the categories described above, the Plan calls for a community offering to the general public with a preference for members of the general public residing in Mercer and Darke Counties in Ohio and Adams and Jay Counties in Indiana ("<u>Community Offering</u>"), followed by a syndicated community offering ("<u>Syndicated Community Offering</u>") for the shares not sold in the Community Offering.

Pursuant to the Plan, all such shares will be issued and sold at a uniform price per share. The aggregate purchase price at which all shares of Common Stock will be offered and sold pursuant to the Plan will be equal to the estimated *pro forma* market value of the Bank, as converted. The estimated *pro forma* market value will be determined by FinPro, Inc., an independent appraiser. The conversion of the Bank from mutual-to-stock form and the sale of newly issued shares of the stock of the Stock Bank to the Holding Company will be deemed effective concurrently with the closing of the sale of Common Stock.

Board of Directors

Mercer Savings Bank

March 7, 2023

**<u>OPINION OF COUNSEL</u>**

Based solely upon the foregoing information, we render the following opinion:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The change in the form of operation of the Bank from an Ohio-chartered mutual bank to an Ohio-chartered stock bank, as described above, will constitute a reorganization within the meaning of Code Section 368(a)(1)(F), and no gain or loss will be recognized to either the Bank or to Stock Bank as a result of the Conversion. <u>See</u> Rev. Rul. 80-105, 1980-1 C.B. 78. The Bank and Stock Bank will each be a party to a reorganization within the meaning of Code Section 368(b). Rev. Rul. 72-206, 1972-1 C.B. 104.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. No gain or loss will be recognized by Stock Bank on the receipt of money from Holding Company in exchange for its shares of common stock or by Holding Company upon the receipt of money from the sale of Common Stock. Code Section 1032(a).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. The assets of the Bank will have the same basis in the hands of Stock Bank as they had in the hands of the Bank immediately prior to the Conversion. Code Section 362(b).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. The holding period of the Bank's assets to be received by Stock Bank will include the period during which the assets were held by the Bank prior to the Conversion. Code Section 1223(2).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. No gain or loss will be recognized by the account holders of the Bank upon the issuance to them of withdrawable deposit accounts in Stock Bank in the same dollar amount and under the same terms as their deposit accounts in the Bank and no gain or loss will be recognized by Eligible Account Holders or Supplemental Eligible Account Holders upon receipt by them of an interest in the Liquidation Account of Stock Bank, in exchange for their ownership interests in the Bank. Code Section 354(a).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. The basis of the account holders' deposit accounts in the Stock Bank will be the same as the basis of their deposit accounts in the Bank surrendered in exchange therefor. The basis of each Eligible Account Holder's and Supplemental Eligible Account Holder's interests in the Liquidation Account of the Stock Bank will be zero, that being the cost of such property.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. It is more likely than not that the fair market value of the nontransferable subscription rights to purchase Common Stock will be zero. Accordingly, no gain or loss will be recognized by Eligible Account Holders or Supplemental Eligible Account Holders or Other Depositors upon the distribution to them of the nontransferable subscription rights to purchase Common Stock. No taxable income will be realized by the Eligible Account Holders, Supplemental Eligible Account Holders or Other Depositors as a result of the exercise of the nontransferable subscription rights. Rev. Rul. 56-572, 1956-2 C.B. 182.

Board of Directors

Mercer Savings Bank

March 7, 2023

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. It is more likely than not that the basis of the Common Stock to the holders of the Common Stock will be the purchase price thereof. (Section 1012 of the Code). The stockholder's holding period will commence upon the exercise of the subscription rights. (Section 1223(5) of the Code).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9. For purposes of Code Section 381, the Stock Bank will be treated as if there had been no reorganization. Accordingly, the taxable year of the Bank will not end on the effective date of the Conversion merely because of the transfer of assets of the Bank to the Stock Bank, and the tax attributes of the Bank will be taken into account by the Stock Bank as if there had been no reorganization. (Treas. Reg. Section 1.381(b)-1(a)(2)).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10. The part of the taxable year of the Bank before the reorganization and the part of the taxable year of Stock Bank after the reorganization will constitute a single taxable year of Stock Bank. <u>See</u> Rev. Rul. 57-276, 1957-1 C.B. 126. Consequently, the Bank will not be required to file a federal income tax return for any portion of such taxable year solely by reason of the Conversion. Treas. Reg. Section 1.381(b)-1(a)(2).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11. The tax attributes of the Bank enumerated in Code Section 381(c) will be taken into account by Stock Bank. Treas. Reg. Section 1.381(b)-1(a)(2).

Notwithstanding any reference to Code Section 381 above, no opinion is expressed or intended to be expressed herein as to the effect, if any, of this transaction on the continued existence of, the carryover or carryback of, or the limitation on, any net operating losses of the Bank or its successor, Stock Bank, under the Code.

Board of Directors

Mercer Savings Bank

March 7, 2023

Our opinion under paragraph 5 above is based on the premise that the benefit provided by the Liquidation Account in the Stock Bank has a fair market value of zero at the time of the Conversion. The Stock Bank Liquidation Account payment obligation arises only in a liquidation of the Stock Bank including if the Stock Bank enters into a transaction to transfer its assets and liabilities to a credit union. We understand that: (i) no holder of an interest in a liquidation account has ever received payment of an interest in a liquidation account attributable to the liquidation of a solvent bank (other than as set forth below); (ii) the interests in the Stock Bank Liquidation Account are not transferable by an Eligible Account Holder or Supplemental Eligible Account Holder; (iii) the amounts due under the Stock Bank Liquidation Account with respect to each Eligible Account Holder and Supplemental Eligible Account Holder will be reduced as their deposits in the Bank are reduced, as described in the Plan; and (iv) holders of an interest in a liquidation account have received payments of their interest in only a limited number of instances (out of hundreds of transactions involving mergers, acquisitions and the purchase of assets and assumptions of liabilities of holding companies and subsidiary banks). These instances involved the purchase and assumption of a bank's assets by a credit union. However, not all states permit the sale of a bank's assets to credit unions, further limiting the opportunity for this type of transaction. We also note that the U.S. Supreme Court in *Paulsen v. Commissioner,* 469 U.S. 131 (1985) stated the following:

The right to participate in the net proceeds of a solvent liquidation is also not a significant part of the value of the shares. Referring to the possibility of a solvent liquidation of a mutual savings association, this Court observed: "It stretches the imagination very far to attribute any real value to such a remote contingency, and when coupled with the fact that it represents nothing which the depositor can readily transfer, any theoretical value reduces almost to the vanishing point." *Society for Savings v. Bowers,* 349 U.S. 143, 150 (1955).

In the present case, we believe that the same analysis as was applied in *Paulsen* and *Society for Savings* can be applied to the extremely remote contingency that a depositor will, at some undetermined time in the future, realize value from the sale of the a bank's assets to a credit union. First, some states prohibit a credit union from acquiring a bank's assets through a purchase and assumption transaction. Second, although others do, as noted above, there have been only a limited number of instances where a credit union has acquired the assets of a bank where an amount representing the then-value of a liquidation account has been (or will be) paid to the bank's eligible depositors. These instances all involved former mutual banks that were required to establish liquidation accounts in a conversion to a stock bank and that later engaged in a purchase and assumption transaction with a credit union. We believe that less than ten instances out of hundreds of converted former mutual banks since 1816 (the date the first mutual bank was chartered, in Massachusetts) have engaged in purchase and assumption transactions with credit unions and have been required to distribute to their depositors the remains of any liquidation accounts. Under these circumstances, we agree with the statement by the Supreme Court in *Society for Savings* that "any theoretical value reduces almost to the vanishing point."

In addition, we are relying on a letter from FinPro, Inc., dated March 7, 2023, to you stating its belief that the benefit provided by the Stock Bank Liquidation Account does not have any economic value at the time of the Conversion. Based on the foregoing, we believe it is more likely than not that liquidation rights in the Stock Bank Liquidation Account have no value.

Board of Directors

Mercer Savings Bank

March 7, 2023

If the IRS were to subsequently find that the Stock Bank Liquidation Account had economic value as of the time of the Conversion, each Eligible Account Holder and Supplemental Eligible Account Holder may need to recognize income in the amount of the fair market value of their interest in the Stock Bank Liquidation Account as of the effective date of the Conversion. However, we are not aware of any situation where rights in a bank liquidation account have been found to have an economic value at the time of a mutual-to-stock conversion or a second-step conversion.

Our opinion under paragraph 7 above is predicated on the representation that no person will receive any payment, whether in money or property, in lieu of the issuance of subscription rights. Our opinion under paragraphs 7 and 8 is based on the facts that the subscription rights will be granted at no cost to the recipients, will be legally non-transferable and of short duration, and will provide the recipient with the right only to purchase shares of Common Stock at the same price to be paid by members of the general public in any Community Offering. We also note that FinPro, Inc. has issued a letter dated March 7, 2023, stating that the subscription rights will have no ascertainable market value. We further note that the Internal Revenue Service has not in the past reached a different conclusion with respect to the value of nontransferable subscription rights. If the subscription rights are subsequently found to have value, income may be recognized by various recipients of the subscription rights (in certain cases, whether or not the rights are exercised) and the Holding Company and/or Stock Bank may be taxable on the distribution of the subscription rights.

**<u>CONSENT</u>**

We hereby consent to the filing of the opinion as an exhibit to the Registration Statement, and as an exhibit to the Applications with respect to the Conversion, as applicable. We also hereby consent to the references to this firm in the prospectus which is a part of the Registration Statement and the Applications.

**<u>USE OF OPINION</u>**

We expressly consent to the use of and reliance on this opinion by S.R. Snodgrass, P.C. in issuing its state tax opinion to the Bank related to the Conversion.

Board of Directors

Mercer Savings Bank

March 7, 2023

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| |
|:---|
| Very truly yours, |
| /s/ Luse Gorman, PC |
| LUSE GORMAN, PC |

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## Exhibit 8.2

**Exhibit 8.2**

![](tm238570d1_ex8-2img01.jpg)

March 7, 2023

Board of Directors

Mercer Savings Bank

1100 Irmscher Boulevard

Celina, OH 45822

Board of Directors:

You have requested our opinion regarding certain Ohio tax consequences of the proposed conversion (the "Conversion") of Mercer Savings Bank (the "Bank") from an Ohio-chartered mutual bank to an Ohio-chartered stock bank, pursuant to a Plan of Conversion adopted by the Board of Directors of the Bank on March 3, 2023 (the "Plan"). Capitalized terms used but not identified herein will have the same meaning as set forth in the Plan.

**<u>BACKGROUND</u>**

Our Ohio tax opinion is in addition to the Federal Tax Opinion of Luse Gorman, PC dated March 7, 2023 (the "Federal Opinion"), which we have reviewed. The proposed transactions and the facts, assumptions, and representations outlined and set forth in the Federal Opinion are also used herein.

Our opinion is based upon: (1) the facts and circumstances of the Plan, including the representations of the parties involved, as described in the Federal Opinion; (2) current provisions of Ohio law; (3) the Federal Opinion; (4) the understanding that only the specific issues and tax consequences opined upon herein are covered by this tax opinion, and no other federal, state, or local taxes of any kind were considered; and (5) your understanding that this opinion is not binding on the state revenue authorities or the courts and should not be considered a representation, warranty, or guarantee that the state revenue authorities or the courts will concur with our opinion.

**<u>STATEMENT OF FACTS</u>**

The Bank is a mutual bank organized under the laws of the State of Ohio that is in the process of converting to an Ohio-chartered stock bank. In connection with and at the time of the Conversion, Eligible Account Holders and, if applicable, Supplemental Eligible Account Holders will exchange their liquidation rights in the Bank for an interest in a liquidation account ("Liquidation Account") established at the Bank.

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|:---|:---|:---|:---|
| <br> PITTSBURGH, PA | PHILADELPHIA, PA | WHEELING, WV | STEUBENVILLE, OH |
| 2009 Mackenzie Way • Suite 340 | 2100 Renaissance Blvd. • Suite 110 | 980 National Road | 511 N. Fourth Street |
| Cranberry Township, PA 16066 | King of Prussia, PA 19406 | Wheeling, WV 26003 | Steubenville, OH 43952 |
| (724) 934-0344 | (610) 278-9800 | (304) 233-5030 | (304) 233-5030 |

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S.R. Snodgrass, P.C. d/b/a S.R. Snodgrass, A.C. in West Virginia

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| ![](tm238570d1_ex8-2img02.jpg) | Mercer Savings Bank<br> Page 2<br> March 7, 2023 |

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**<u>STATEMENT OF FACTS</u> (Continued)**

In the Conversion, all of the Bank's to-be-issued stock will be acquired by Mercer Bancorp, Inc., a Maryland corporation (the "Holding Company"). The Holding Company has been formed under the laws of the State of Maryland for the purpose of the proposed transactions described herein, to engage in business as a bank holding company and to hold all of the stock of the Stock Bank. The Holding Company will issue shares of its voting common stock ("Common Stock"), upon completion of the mutual-to-stock conversion of the Bank, to persons purchasing such shares as described in greater detail below.

Following regulatory approval, the Plan provides for the offer and sale of shares of Common Stock in a Subscription Offering pursuant to nontransferable subscription rights on the basis of the following preference categories: (1) Eligible Account Holders; (2) the Bank's tax-qualified employee stock benefit plans, including the newly formed employee stock ownership plan; (3) if applicable, Supplemental Eligible Account Holders; and (4) Other Members, all as described in the Plan. The minimum amount of shares in the offering range must be sold. If shares remain after all orders are filled in the categories described above, the Plan calls for a community offering to the general public with a preference for members of the general public residing in Darke County in Ohio and Adams and Jay Counties in Indiana ("Community Offering"), followed by a syndicated community offering ("Syndicated Community Offering") for the shares not sold in the Community Offering.

Pursuant to the Plan, all such shares will be issued and sold at a uniform price per share. The aggregate purchase price at which all shares of Common Stock will be offered and sold pursuant to the Plan will be equal to the estimated pro forma market value of the Bank, as converted. The estimated pro forma market value will be determined by FinPro, Inc., an independent appraiser. The conversion of the Bank from mutual to stock form and the sale of newly issued shares of the stock of the Stock Bank to the Holding Company will be deemed effective concurrently with the closing of the sale of Common Stock.

**<u>STATE TAX LAW</u>**

OHIO FINANCIAL INSTITUTIONS TAX (FIT)

Ohio levies the FIT on the privilege of doing business in Ohio measured by total Ohio equity capital of financial institutions in proportion to the gross receipts sitused to Ohio. The tax levied on a financial institution shall be the greater of:

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|:---|:---|
| 1.) | a minimum tax equal to $1,000, or |

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|:---|:---|
| 2.) | a three-tiered tax rate structure of total Ohio equity capital of the financial institution multiplied by: |

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&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. eight mills for each dollar of the first $200 million of total Ohio equity capital;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. four mills for each dollar of total Ohio equity capital greater than $200 million and less than $1.3 billion;
and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c. two and one-half mills for each dollar of total Ohio equity capital equal to or greater than $1.3 billion.

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| ![](tm238570d1_ex8-2img02.jpg) | Mercer Savings Bank<br> Page 3<br> March 7, 2023 |

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**<u>STATE TAX LAW</u> (Continued)**

OHIO FINANCIAL INSTITUTIONS TAX (FIT) (Continued)

If the reporting person for a financial institution files an FR Y-9 or call report, the total equity capital of the financial institution shall equal the total equity capital shown on the reporting person's FR Y-9 or call report as of the end of the taxable year. The total equity capital of all other financial institutions shall be reported as of the end of the taxable year in accordance with generally accepted accounting principles. (Sec. 5726.04, Ohio R.C.)

"Financial institution" is defined as a bank organization, a holding company of a bank organization, or a nonbank financial organization when consolidated for the purposes of filing an FR Y-9 or when all entities are included in the call report. (Sec. 5726.01(H), Ohio R.C.)

"FR Y-9" means the consolidated or parent-only financial statements that a holding company is required to file with the Federal Reserve Board pursuant to 12 U.S.C. 1844. In the case of a holding company required to file both consolidated and parent-only financial statements, "FR Y-9" means the consolidated financial statements that the holding company is required to file. (Sec. 5726.01(I), Ohio R.C.)

"Total equity capital" means the sum of the common stock at par value, perpetual preferred stock and related surplus, other surplus not related to perpetual preferred stock, retained earnings, accumulated other comprehensive income, treasury stock, unearned employee stock ownership plan shares, and other equity components of a financial institution. "Total equity capital" shall not include any noncontrolling (minority) interests as reported on an FR Y-9 or call report, unless such interests are in a bank organization or a bank holding company. (Sec. 5726.01(S), Ohio R.C.)

"Total Ohio equity capital" means the product of (a) the total equity capital of a financial institution as of the end of a taxable year to the extent that the total equity capital does not exceed 14 percent of the financial institution's total assets multiplied by (b) the Ohio apportionment ratio calculated for the financial institutions. (Sec. 5726.04(C)(1), Ohio R.C).

"Gross receipts" means all items of income, without deduction for expenses. If the reporting person for a taxpayer is a holding company, "gross receipts" includes all items of income reported on the FR Y-9 filed by the holding company. If the reporting person for a taxpayer is a bank organization, "gross receipts" includes all items of income reported on the call report filed by the bank organization. If the reporting person for a taxpayer is a nonbank financial organization, "gross receipts" includes all items of income reported in accordance with generally accepted accounting principles. (Sec. 5726.01(K) Ohio R.C.)

OHIO COMMERCIAL ACTIVITY TAX (CAT)

Ohio levies the CAT on each person with taxable gross receipts for the privilege of doing business in Ohio, including individuals and entities having more than $150,000 in taxable gross receipts in a calendar year. The tax applies whether the business is operated in Ohio or located outside the state if the taxpayer has enough presence in Ohio.

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| ![](tm238570d1_ex8-2img02.jpg) | Mercer Savings Bank<br> Page 4<br> March 7, 2023 |

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**<u>STATE TAX LAW</u> (Continued)**

OHIO COMMERCIAL ACTIVITY TAX (CAT) (Continued)

Ohio imposes the CAT at a rate of 0.26 percent on annual gross receipts as follows:

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|:---|:---|
| 1.) | For taxpayers with annual taxable gross receipts of $1 million or less for the calendar year, the annual minimum tax is $150; |

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|:---|:---|
| 2.) | For taxpayers with annual taxable gross receipts greater than $1 million, but less than or equal to $2 million for the calendar year, the annual minimum tax is $800; |

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|:---|:---|
| 3.) | For taxpayers with annual taxable gross receipts greater than $2 million, but less than or equal to $4 million for the calendar year, the annual minimum tax is $2,100; |

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|:---|:---|
| 4.) | For taxpayers with annual taxable gross receipts greater than $4 million for the calendar year, the annual minimum tax is $2,600. (Sec. 5751.03, Ohio R.C.) |

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A financial institution, as defined in section 5726.01 of the Revised Code, that paid the tax imposed by section 5726.02 of the Revised Code based on one or more taxable years and/or a person directly or indirectly owned by one or more financial institutions, as defined in section 5726.01 of the Revised Code, that paid the tax imposed by section 5726.02 of the Revised Code based on one or more taxable years, is exempt from the CAT. (Sec. 5751.01(E), Ohio R.C)

OHIO INDIVIDUAL INCOME TAX

The statutory provisions levying the Ohio personal income tax are codified as Chapter 5747, Ohio Revised Code. The Ohio personal income tax is a graduated tax on the modified federal adjusted gross income, less exemptions, of every Ohio resident and nonresident (individual, trust, and estate) earning or receiving income in Ohio.

The computational starting point for the taxable income of individuals is federal "adjusted gross income." (Sec. 5747.01(A), Ohio R.C.) Taxpayers must adjust the federal base with various additions and deductions to arrive at Ohio adjusted gross income. Since there is no specific Ohio provision for gain or loss, federal provisions for gain or loss will apply to Ohio.

**<u>OPINION</u>**

It is our opinion that:

&nbsp;&nbsp;&nbsp;&nbsp;A. The Plan will not result in any additional tax liabilities under the Ohio FIT, provided there is no change
in equity or basis of assets solely as a result of the Conversion. The Holding Company will likely have a greater amount of common stock
and additional paid in capital as a result of issuance of its common stock upon completion of the mutual-to-stock conversion, resulting
in an increase in total equity capital subject to the Ohio FIT.

&nbsp;&nbsp;&nbsp;&nbsp;B. The Plan will not result in any Ohio CAT. This is provided the Conversion does not result in forming a
company other than the Holding Company or a nonbank financial organization not owned by the Bank or Holding Company.

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| ![](tm238570d1_ex8-2img02.jpg) | Mercer Savings Bank<br> Page 5<br> March 7, 2023 |

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**<u>OPINION</u> (Continued)**

&nbsp;&nbsp;&nbsp;&nbsp;C. The issuance of nontransferable subscription rights to the recipients will not result in any Ohio Personal
Income Tax. This is provided there is no ascertainable value assigned to the rights.

&nbsp;&nbsp;&nbsp;&nbsp;D. There will be no additional Ohio Personal Income Tax on Eligible Account Holders, Supplemental Eligible
Account Holders, if applicable, or Other Depositors upon the distribution to them of the nontransferable subscription rights to purchase
Common Stock.

&nbsp;&nbsp;&nbsp;&nbsp;E. There will be no additional Ohio Personal Income Tax on Eligible Account Holders, Supplemental Eligible
Account Holders, if applicable, or Other Depositors as a result of the exercise of the nontransferable subscription rights.

The state income tax opinion expressed above is limited to those taxes specified in this opinion letter and specifically does not include any opinions with respect to any other taxes. In addition, the opinions herein do not include any opinion with respect to tax liabilities attributable to events occurring after the Plan is enacted or to any assets held or acquired by the Holding Company other than stock of the Bank.

Our opinion is based on the facts and circumstances as stated herein, whether directly or by reference to the Federal Opinion. If any of the facts and conditions are not entirely complete or accurate, it is imperative that we are informed immediately, since the inaccuracy or incompleteness could have a material effect on our conclusions. In rendering our opinion, we are relying upon the laws of the State of Ohio, which are subject to change or modification by subsequent legislative, regulatory, administrative, or judicial decisions. We undertake no responsibility to update or supplement our opinion. Our opinion is not binding on the Internal Revenue Service or the State of Ohio, nor can any assurance be given that any of the foregoing parties will not take a contrary position or that our opinion will be upheld if challenged by such parties.

**<u>USE OF OPINION</u>**

This opinion is given solely for the benefit of the parties to the Plan, the depositors of the Bank, and other investors who purchase stock pursuant to the Plan, and may not be relied upon by any other person or entity or referred to in any document without our express written consent.

**<u>CONSENT</u>**

We hereby consent to the filing of this opinion as an exhibit to the Registration Statement, and as an exhibit to the Applications with respect to the Conversion, as applicable. We also hereby consent to the references to this firm in the prospectus that is a part of the Registration Statement and the Applications.

Very truly yours,

/s/ S.R. Snodgrass, P.C.

S.R. Snodgrass, P.C.

Cranberry Township, Pennsylvania

## Exhibit 10.1

**Exhibit 10.1**

**MERCER SAVINGS BANK**

**EMPLOYMENT AGREEMENT**

This Amended and Restated Agreement (this "Agreement") is made effective as of the 1<sup>st</sup> day of March, 2023 (the "Effective Date"), by and between Mercer Savings Bank (the "Bank"), a state-chartered institution with its principal offices at 1100 Irmscher Blvd, Celina, OH 45822 and Alvin B. Parmiter ("Executive"). References to the "Company" in this Agreement means Mercer Bancorp, Inc., the proposed holding company of the Bank.

**WITNESSETH:**

WHEREAS, the Bank wishes to assure itself of the services of Executive for the period provided in this Agreement; and

WHEREAS, Executive is willing to serve in the employ of the Bank on a full-time basis as its President and Chief Executive Officer on the terms and conditions set forth in this Agreement.

NOW, THEREFORE, in consideration of the mutual promises and covenants contained in this Agreement, and upon the other terms and conditions hereinafter provided, the parties hereby agree as follows:

1. POSITION AND RESPONSIBILITIES

During the term of Executive's employment hereunder, Executive agrees to serve as the President and Chief Executive Officer of the Bank. Executive shall perform administrative and management services for the Bank which are customarily performed by persons in a similar executive officer capacity. Executive shall be responsible for the overall management of the Bank and shall be responsible for establishing the business objectives, policies and strategic plan of the Bank. Executive shall also be responsible for providing leadership and direction to all departments or divisions of the Bank, and shall be the primary contact between the Board of Directors and the staff of the Bank. During the term of this Agreement, Executive also agrees to serve as a director of the Bank and, if elected, as an officer and director of any subsidiary of the Bank. Executive's principal place of employment shall be at the Bank's principal executive offices. The Bank shall provide Executive, at his principal place of employment, with support services and facilities suitable to his position with the Bank and necessary or appropriate in connection with the performance of his duties under this Agreement.

2. TERM OF EMPLOYMENT

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The term of this Agreement and the period of Executive's employment under this Agreement will begin as of the Effective Date and will continue for a period of thirty-six (36) full calendar months thereafter. As of January 1<sup>st</sup> each year (the "Renewal Date"), beginning with the first January 1<sup>st</sup> following the Effective Date, this Agreement shall renew for an additional year such that the remaining term shall again be thirty-six (36) full calendar months provided, however, that the disinterested members of the Board of Directors of the Bank (the "Board of Directors") shall at least thirty (30) days before the Renewal Date conduct a comprehensive performance evaluation and review of Executive for purposes of determining whether to extend this Agreement.

The Board of Directors shall give Executive notice of its decision whether or not to renew this Agreement at least ten (10) days prior to the Renewal Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Change in Control</u>. Notwithstanding the foregoing, in the event the Bank or the Company has entered into an agreement to effect a transaction that would be considered a Change in Control, as defined in this Agreement, the Term of this Agreement will automatically extend so that it expires no less than two (2) years beyond the effective date of the Change in Control, subject to extensions as set forth in Section 1(a).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Notwithstanding anything contained in this Agreement to the contrary, either Executive or the Bank may terminate Executive's employment with the Bank at any time during the term of this Agreement, subject to the terms and conditions of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) In the event of the Executive's termination of employment under this Agreement for any reason, such termination shall also constitute the Executive's resignation from the Board of Directors of the Bank and the Board of Directors of the Company.

3. COMPENSATION AND REIMBURSEMENT

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The compensation specified under this Agreement shall constitute consideration paid by the Bank in exchange for duties described in Section 1 of this Agreement. The Bank shall pay Executive, as compensation, a salary of not less than $195,000 per year ("Base Salary"). Base Salary shall include any amounts of compensation deferred by Executive under any employee benefit plan or deferred compensation arrangement maintained by the Bank. Base Salary shall be payable bi-weekly or, if different, in accordance with the Bank's customary payroll practices. During the term of this Agreement, Executive's Base Salary shall be reviewed at least annually by December 31<sup>st</sup> of each year. The review shall be conducted by the Board of Directors or by a committee designated by the Board of Directors. The committee or the Board of Directors may increase, but not decrease, Executive's Base Salary at any time, except for a decrease not in excess of any decrease generally applicable to all officers of the Bank. Any increase in Base Salary shall become the "Base Salary" for purposes of this Agreement. The Board of Directors may engage the services of an independent consultant to assist in the determination of the appropriate Base Salary. In addition to the Base Salary provided in this Section 3, the Bank shall also provide Executive with all other benefits as are provided uniformly to full-time employees of the Bank, on a basis (including cost) no less favorable than the benefits provided to other senior officers of the Bank.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In addition to the Base Salary provided for in Section 3(a), the Bank will provide Executive with the opportunity to participate in employee benefit plans, arrangements and perquisites substantially equivalent to those in which Executive was participating or otherwise deriving a benefit from immediately prior to the Effective Date, and any other employee benefit plans, arrangements and perquisites suitable for the Bank's senior executives adopted by the Bank subsequent to the Effective Date, and the Bank will not, without Executive's prior written consent, make any changes in the plans, arrangements or perquisites which would adversely affect Executive's rights or benefits thereunder, without separately providing for an arrangement that ensures Executive receives or will receive the economic value that Executive would otherwise lose as a result of such adverse effect, unless the changes apply equally to all other employees or senior officers of the Bank. Without limiting the generality of the foregoing provisions of this Section 3(b), Executive shall be entitled to participate in or receive benefits under any employee benefit plans, whether tax-qualified or otherwise, including, but not limited to, retirement plans, supplemental retirement plans, deferred compensation plans, pension plans, profit-sharing plans, employee stock ownership plans, stock award or stock option plans, health-and-accident plans, medical coverage or any other employee benefit plan or arrangement made available by the Bank in the future to its senior executives and key management employees, subject to and on a basis consistent with the terms, conditions and overall administration of the plans and arrangements (including designation by the Board of Directors of eligibility to participate, if applicable). Executive shall also be entitled to participate in any incentive compensation or bonus plan or arrangement of the Bank in which Executive is eligible to participate (and he shall be entitled to a pro rata distribution under any incentive compensation or bonus plan as to any year in which a termination of employment occurs, other than Termination for Just Cause). Nothing paid to Executive under the plans or arrangements will be deemed to be in lieu of other compensation to which Executive is entitled under this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) In addition, Executive will participate in the Bank's incentive compensation plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) In addition to the Base Salary provided for by Section 3(a) and other compensation and benefits provided for by Sections 3(b) and 3(c), the Bank shall pay or reimburse Executive for all reasonable expenses incurred by Executive in performing his obligations under this Agreement in accordance with the Bank's reimbursement policies, provided that the reimbursement is made within one calendar year following the date on which the expense was incurred and provided further that the right to reimbursement is not exchanged for another benefit. The amount of expenses eligible for reimbursement during the calendar year may not affect the expenses eligible for reimbursement in any other calendar year.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Executive shall be entitled to paid time off in accordance with the standard policies of the Bank for senior executive officers, but in no event less than 20 days paid time off during each year of employment. Executive shall receive his Base Salary and other benefits during periods of paid leave. Executive shall also be entitled to paid legal holidays in accordance with the policies of the Bank. Executive shall also be entitled to a minimum of 15 days sick leave and then additional days as accrued in accordance with the policies of the Bank, but in no event less than the number of days of sick leave per year to which Executive was entitled at the Effective Date.

4. OUTSIDE ACTIVITIES

During the term of his employment under this Agreement, except for periods of absence occasioned by illness, reasonable vacation periods and reasonable leaves of absence approved by the Board of Directors, Executive shall devote substantially all his business time, attention, skill, and efforts to the faithful performance of his duties hereunder. Executive also may serve as a member of the board of directors of business organizations, trade associations, and community and charitable organizations, subject to the annual approval of the Board of Directors; provided that in each case the service shall not materially interfere with the performance of his duties under this Agreement, adversely affect the reputation of the Bank or present any conflict of interest. Executive shall provide to the Board of Directors annually a list of all organizations for which Executive serves as a director or in a similar capacity for purposes of obtaining the approval of the Board of Directors of Executive's service on the boards of such organizations (it being understood that membership in social, religious, charitable or similar organizations does not require approval of the Board of Directors pursuant to this Section 4).

5. PAYMENTS TO EXECUTIVE UPON AN EVENT OF TERMINATION

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Upon the occurrence of an Event of Termination (as herein defined) during Executive's term of employment under this Agreement, the provisions of this Section 5 shall apply. As used in this Agreement, an "Event of Termination" shall mean and include any of the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the termination by the Bank of Executive's full-time employment hereunder for any reason other than termination governed by Section 6 (Termination for Just Cause), or termination governed by Section 7 (Termination For Disability or Death), or termination governed by Section 8 (Termination Upon Retirement); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Executive's resignation from the Bank's employ for any of the following reasons (each shall be deemed a "Good Reason"):

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) the failure to elect or reelect or to appoint or reappoint Executive to the position set forth under Section
1 of this Agreement or the failure to nominate or re-nominate Executive as a director of the Bank;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) a material change in Executive's functions, duties, or responsibilities with the Bank, which change
would cause Executive's position to become one of lesser responsibility, importance, or scope from the position and attributes described
in Section 1 of this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C) a relocation of Executive's principal place of employment by more than 30 miles from the main office
of the Bank;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(D) a material reduction in the benefits and perquisites of Executive from those being provided as of the
Effective Date, other than a reduction pursuant to Section 3(a) of this Agreement or a reduction that is part of a Bank-wide reduction
in pay or benefits;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(E) a liquidation or dissolution of the Bank, other than a liquidation or dissolution which does not affect
the status of Executive; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(F) a material breach of this Agreement by the Bank.

Upon the occurrence of any event described in clauses (ii)(A), (B), (C), (D), (E) or (F), above, Executive shall have the right to elect to terminate his employment under this Agreement by resignation upon not less than thirty (30) days prior written Notice of Termination, as defined in Section 9(a), given within ninety (90) days after the event giving rise to said right to elect. Notwithstanding the preceding sentence, Executive, after giving due notice within the prescribed time frame of an initial event specified above, shall not waive any of his rights under this Agreement by virtue of the fact that Executive has submitted his resignation but has remained in the employ of the Bank, provided Executive is engaged in good faith discussions to resolve the occurrence of any event described in clauses (ii)(A), (B), (C), (D), (E) or (F) above. During this thirty (30) day period, the Bank shall have the right to cure the Good Reason, and in the event that the Bank cures said Good Reason, Executive shall no longer have the right to terminate employment and receive a payment under this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) The termination of Executive's employment (other than Termination for Just Cause) by the Bank (or any successor thereto) on the effective date of, or at any time following a Change in Control, or Executive's resignation from the Bank's employ due to Good Reason (subject to Executive's notice of Good Reason and the Bank's right to cure, as set forth in Section 5(a)(ii)) on the effective date of, or at any time following a Change in Control, during the term of this Agreement. For purposes of this Agreement, the term "<u>Change in Control</u>" means: (i) a change in the ownership of the Corporation; (ii) a change in the effective control of the Corporation; or (iii) a change in the ownership of a substantial portion of the assets of the Corporation as defined in accordance with Code Section 409A. For purposes of this provision, the term "<u>Corporation</u>" means the Bank, the Company or any of their successors, as applicable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A) A
change in the ownership of a Corporation occurs on the date that any one person, or more than one person acting as a group (as defined
in Treasury Regulation 1.409A-3(i)(5)(v)(B)), acquires ownership of stock of the Corporation that, together with stock held by such person
or group, constitutes more than fifty (50) percent of the total fair market value or total voting power of the stock of the Corporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B) A change in the effective control of the Corporation occurs on the date
that either (A) any one person, or more than one person acting as a group (as defined in Treasury Regulation 1.409A-3(i)(5)(vi)(D)) acquires
(or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) ownership of
stock of the Corporation possessing thirty (30) percent or more of the total voting power of the stock of the Corporation, or (B) a majority
of the members of the board of directors is replaced during any twelve (12) month period by directors whose appointment or election is
not endorsed by a majority of the members of the board of directors prior to the date of the appointment or election, provided that this
subsection "(B)" is inapplicable where a majority stockholder of the Corporation is another corporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C) change in a substantial portion of the Corporation's assets occurs
on the date that any one person or more than one person acting as a group (as defined in Treasury Regulation 1.409A-3(i)(5)(vii)(C)) acquires
(or has acquired during the twelve (12) month period ending on the date of the most recent acquisition by such person or persons) assets
from the Corporation that have a total gross fair market value equal to or more than forty (40) percent of the total gross fair market
value of (A) all of the assets of the Corporation, or (B) the value of the assets being disposed of, either of which is determined without
regard to any liabilities associated with such assets.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(D) For all purposes hereunder, the definition of Change in Control shall be
construed to be consistent with the requirements of Treasury Regulation 1.409A-3(i)(5), except to the extent that such regulations are
superseded by subsequent guidance.

Notwithstanding anything in this Agreement to the contrary, in no event shall the conversion of the Bank from mutual to stock form (including, without limitation, through the formation of a stock holding company), the reorganization of the Bank into the mutual holding company form of organization or the issuance of stock by a parent mutual holding company in connection with a conversion or minority stock offering constitute a Change in Control for purposes of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Upon the occurrence of an Event of Termination under Sections 5(a)(i) or 5(a)(ii) above, on the Date of Termination, as defined in Section 9(b) of this Agreement, the Bank shall be obligated to pay Executive, or, in the event of his subsequent death, his beneficiary or beneficiaries, or his estate, as the case may be, as severance pay or liquidated damages, or both, an amount equal to the sum of: (i) his earned but unpaid salary as of the date of his termination of employment with the Bank; (ii) the benefits, if any, to which he is entitled as a former employee under the employee benefit plans and programs and compensation plans and programs maintained for the benefit of the Bank's officers and employees; and (iii) the remaining payments of Base Salary that Executive would have earned, in accordance with Section 3(a) if he had continued his employment with the Bank for the remaining term of this Agreement plus the bonus or incentive award Executive would have received in each year during the remaining term in an amount equal to the average bonus and/or incentive award earned by him over the three calendar years preceding the year in which the termination occurs. (In determining the bonus and/or incentive portion of the payment, the total amount will be determined by: Adding the bonuses and/or incentives earned in each of the last three years; dividing the total by 36; and then multiplying the result by the number of whole months in the remaining unexpired term of this Agreement). Any payments hereunder shall be made in a lump sum within thirty (30) days after the Date of Termination, or if Section 409A of the Internal Revenue Code of 1986, as amended ("Code") applies to the payment, and Executive is considered a "Specified Employee" under Code Section 409A, on the first day of the seventh month following the Date of Termination. The payments shall not be reduced in the event Executive obtains other employment following termination of employment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Upon the occurrence of an Event of Termination under Section 5(a)(iii), on the Date of Termination, as defined in Section 9(b) of this Agreement, the Bank shall be obligated to pay Executive, or, in the event of his subsequent death, his beneficiary or beneficiaries, or his estate, as the case may be, as severance pay or liquidated damages, or both, an amount equal to the sum of: (i) his earned but unpaid salary as of the date of his termination of employment with the Bank; (ii) the benefits, if any, to which he is entitled as a former employee under the employee benefit plans and programs and compensation plans and programs maintained for the benefit of the Bank's officers and employees; and (iii) an amount equal to three (3) times Executive's "base amount," as that term is defined for purposes of Code Section 280G. Any payments hereunder shall be made in a lump sum within five (5) days after the Date of Termination, or in the event that Code Section 409A applies to the payment and Executive is considered a "Specified Employee" under Code Section 409A, on the first day of the seventh month following the Date of Termination. The payments shall not be reduced in the event Executive obtains other employment following termination of employment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Upon the occurrence of an Event of Termination, the Bank will cause to be continued at its expense non-taxable medical and dental coverage substantially identical to the coverage maintained by the Bank for Executive and his family prior to Executive's termination. The coverage shall continue for the remaining term of this Agreement in the case of an Event of Termination under Sections 5(a)(i) or 5(a)(ii), and for a period of twenty-four (24) months from the Date of Termination in the case of an Event of Termination under Section 5(a)(iii) of this Agreement. If the Bank cannot provide the benefits set forth in this Section 5(d) because Executive is no longer an employee, applicable rules and regulations prohibit the benefits in the manner contemplated, or it would subject the Bank to penalties, then the Bank shall pay Executive a cash lump sum payment reasonably estimated to be equal to the value of such benefits or the value of the remaining benefits at the time of such determination. The cash payment shall be made in a lump sum within thirty (30) days after the later of Executive's date of termination or the effective date of the rules or regulations prohibiting the benefits or subjecting the Bank to penalties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Executive shall be entitled to voluntarily terminate his employment other than for Good Reason at any time during the term of this Agreement, provided, however, that Executive shall not be entitled to any compensation or benefits under this Section 5 as a result of such termination (other than compensation and benefits earned but not yet paid as of the time of his termination of employment).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Any payments or benefits under Sections 5(a)(i) or 5(a)(ii) of the Agreement shall be contingent on Executive's execution and non-revocation of a mutual release (the "Mutual Release"), satisfactory to the Bank, of all claims that Executive or any of Executive's affiliates or beneficiaries may have against the Bank or any affiliate, and their officers, directors, successors and assigns, releasing said persons from any and all claims, rights, demands, causes of action, suits, arbitrations or grievances relating to Executive's employment relationship, including claims under the Age Discrimination in Employment Act ("ADEA"), but not including claims for benefits under tax-qualified plans or other benefit plans in which Executive is vested, claims for benefits required by applicable law or claims with respect to obligations set forth in this Agreement that survive the termination of this Agreement. The Bank shall also execute the Mutual Release, which shall release Executive, his affiliates and beneficiaries from any and all claims rights, demands, causes of action, suits, arbitrations or grievances relating to Executive's employment relationship, provided, however, that if the Bank refuses to execute the Mutual Release in the time frame set forth below, Executive's obligation to execute and not revoke the Mutual Release as a precondition to receiving such payments or benefits under Sections 5(a)(i) or 5(a)(ii) shall terminate. Notwithstanding the foregoing sentence, the Mutual Release shall not release Executive for (i) acts of fraud; (ii) felonious acts for which Executive is convicted, enters a plea of nolo contendere, or enters into a pre-trial diversion or similar program; (iii) intentional misconduct resulting in financial harm to the Bank; or (iv) willful violation of any material federal banking law or regulation. In order to comply with the requirements of Section 409A of the Code and the ADEA, the release must be provided to Executive no later than the date of his Separation from Service and Executive and the Bank must execute the Mutual Release within twenty-one (21) days after the date of termination without subsequent revocation by Executive within seven (7) days after execution of the release. This Section 5(f) shall not apply with respect to payments or benefits under Section 5(a)(iii) of this Agreement.

6. TERMINATION FOR JUST CAUSE

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The term "Termination for Just Cause" shall mean termination because of Executive's personal dishonesty, incompetence, willful misconduct, breach of fiduciary duty involving personal profit, intentional failure to perform stated duties, willful violation of any law, rule or regulation (other than traffic violations or similar offenses) or final cease-and-desist order, conduct by Executive that results in the removal of Executive as an officer or employee of the Bank pursuant to a written order by any regulatory agency with authority or jurisdiction over the Bank, or material breach of any provision of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Notwithstanding Section 6(a), the Bank may not terminate Executive for Just Cause unless and until there shall have been delivered to him a Notice of Termination which shall include a copy of a resolution duly adopted by the affirmative vote of not less than a majority of the entire membership of the Board of Directors at a meeting of the Board of Directors called and held for that purpose, finding that in the good faith opinion of the Board of Directors, Executive was guilty of conduct justifying Termination for Just Cause. Executive shall not have the right to receive compensation or other benefits for any period after Termination for Just Cause. Executive shall not, as a result of Termination for Just Cause, forfeit any rights to compensation or benefits, including benefits under qualified or non-qualified retirement or deferred compensation plans or programs, earned and vested as of the date of termination.

7. TERMINATION FOR DISABILITY OR DEATH

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Bank or Executive may terminate Executive's employment after having established Executive's Disability. For purposes of this Agreement, "Disability" means a physical or mental infirmity that impairs Executive's ability to substantially perform his duties under this Agreement and that results in Executive's becoming eligible for long-term disability benefits under a long-term disability plan of the Bank (or, if the Bank has no such plan in effect, that impairs Executive's ability to substantially perform his duties under this Agreement for a period of one hundred eighty (180) consecutive days), provided, however, that in order to receive the payments from the Bank under Section 7(b) of this Agreement, Executive's "Disability" shall also satisfy the requirements of Code Section 409A. The Board of Directors shall determine in good faith, based upon competent medical advice and other factors that they reasonably believe to be relevant, whether or not Executive is and continues to be disabled for purposes of this Agreement. As a condition to any benefits, the Board of Directors may require Executive to submit to such physical or mental evaluations and tests as it deems reasonably appropriate, at the Bank's expense.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In the event of Disability, Executive's obligation to perform services under this Agreement will terminate. In the event of such termination, Executive shall be entitled to receive benefits under any disability program sponsored by the Bank.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) In the event of Executive's death during the term of this Agreement, his estate, legal representatives or named beneficiary or beneficiaries (as directed by Executive in writing) shall be paid Executive's Base Salary, as defined in Section 3(a), at the rate in effect at the time of Executive's death through the end of the calendar month in which Executive's death occurs, and the Bank will continue to provide Executive's family the same medical, dental, and other health benefits that were provided by the Bank to Executive's family immediately prior to Executive's death, on the same terms, including cost, as if Executive were actively employed by the Bank, except to the extent the terms (including cost) of such benefits are changed in their application to all continuing employees of the Bank, such coverage to continue for a period of one (1) year after the date of Executive's death. If the Bank cannot provide the benefits set forth in this paragraph because Executive is no longer an employee, applicable rules and regulations prohibit the benefits in the manner contemplated, or it would subject the Bank to penalties, then the Bank shall pay Executive's family a cash lump sum payment reasonably estimated to be equal to the value of the benefits or the value of the remaining benefits at the time of the determination. The cash payment shall be made in a lump sum within thirty (30) days after the later of Executive's date of death or the effective date of the rules or regulations prohibiting the benefits or subjecting the Bank to penalties.

8. TERMINATION UPON RETIREMENT

Termination of Executive's employment based on "Retirement" shall mean termination of Executive's employment by the Bank on or after age 65, Executive's voluntary termination at any time after Executive reaches age 75, or retirement at any time as agreed upon by the Board of Directors and Executive. Upon termination of Executive based on Retirement, no amounts or benefits shall be due Executive under this Agreement, and Executive shall be entitled to all benefits under any retirement plan of the Bank and other plans to which Executive is a party, or in accordance with any other retirement arrangements approved by the Board of Directors.

9. NOTICE

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Any notice required under this Agreement shall be in writing and hand-delivered to the other party. Any termination by the Bank or by Executive shall be communicated by Notice of Termination to the other party hereto. For purposes of this Agreement, a "Notice of Termination" shall mean a written notice which shall indicate the specific termination provision in this Agreement relied upon.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) "Date of Termination" shall mean (i) if Executive's employment is terminated for Disability, thirty (30) days after a Notice of Termination is given (provided that he shall not have returned to the performance of his duties on a full-time basis during the thirty (30) day period), and (ii) if his employment is terminated for any other reason, the date specified in the Notice of Termination, provided however, in either case, the "Date of Termination" shall not occur prior to the date on which Executive has a "Separation from Service" within the meaning of Code Section 409A.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) If the party receiving a Notice of Termination desires to dispute or contest the basis or reasons for termination, the party receiving the Notice of Termination must notify the other party within thirty (30) days after receiving the Notice of Termination that the a dispute exists, and shall pursue the resolution of the dispute in good faith and with reasonable diligence pursuant to Section 20 of this Agreement. During the pendency of any dispute, neither the Bank shall be obligated to pay Executive compensation or other payments beyond the Date of Termination.

10. POST-TERMINATION OBLIGATIONS

Executive shall, upon reasonable notice, furnish any information and assistance honestly and in good faith to the Bank as may reasonably be required by the Bank in connection with any litigation in which it or any of its subsidiaries or affiliates is, or may become, a party. All payments and benefits to Executive under this Agreement shall be subject to Executive's compliance with this Section 10 for one (1) full year after the earlier of the expiration of this Agreement or termination of Executive's employment with the Bank.

11. NON-COMPETITION AND NON-DISCLOSURE

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) As a material inducement of the Bank to enter into this Agreement, upon any termination of Executive's employment hereunder pursuant to the terms of this Agreement, other than a termination of Executive's employment under Section 5(a)(iii) of this Agreement or a termination for Just Cause, Executive agrees not to compete with the Bank or any affiliate of the Bank (collectively said entities are referred to as the "Bank" for purposes of this Section 11) for a period of twelve (12) months following such termination within a forty-five (45) mile radius of the main office of the Bank. Executive agrees that during this period and within a forty-five (45) mile radius of the main office of the Bank, Executive shall not work for or advise, consult or otherwise serve with, directly or indirectly, any entity whose business materially competes with the depository, lending or other business activities of the Bank. Executive further agrees that for a period of twelve (12) months following any termination of employment, he shall not directly or indirectly, solicit, hire, or entice any of the following persons or entities to cease, terminate, or reduce any relationship with the Bank or to divert any business from the Bank: (i) any person who was an employee of the Bank during the term of this Agreement; or (ii) any customer or client of the Bank. Further, Executive will not directly or indirectly disclose the names, addresses, telephone numbers, compensation, or other arrangements between the Bank and any person or entity described in (a)(i) and (a)(ii) of this Section 11. The parties hereto, recognizing that irreparable injury will result to the Bank, its business and property in the event of Executive's breach of this Section 11(a), agree that in the event of any such breach by Executive, the Bank will be entitled, in addition to any other remedies and damages available, to an injunction to restrain the violation hereof by Executive, Executive's partners, agents, servants, employees and all persons acting for or under the direction of Executive. Nothing herein will be construed as prohibiting the Bank from pursuing any other remedies available to the Bank for such breach or threatened breach, including the recovery of damages from Executive.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Executive recognizes and acknowledges that the knowledge of the business activities, plans for business activities, and all other proprietary information of the Bank as it may exist from time to time, are valuable, special and unique assets of the business of the Bank. Executive will not, during or after the term of his employment, disclose any knowledge of the past, present, planned or considered business activities or any other similar proprietary information of the Bank to any person, firm, corporation, or other entity for any reason or purpose whatsoever unless expressly authorized by the Board of Directors or required by law. Notwithstanding the foregoing, Executive may disclose any knowledge of banking, financial and/or economic principles, concepts or ideas which are not solely and exclusively derived from the business plans and activities of the Bank. Further, Executive may disclose information regarding the business activities of the Bank to any bank regulator having regulatory jurisdiction over the activities of the Bank, pursuant to a formal regulatory request. In the event of a breach or threatened breach by Executive of the provisions of this Section 11, the Bank will be entitled to an injunction restraining Executive from disclosing, in whole or in part, the knowledge of the past, present, planned or considered business activities of the Bank, or any other similar proprietary information, or from rendering any services to any person, firm, corporation, or other entity to whom such knowledge, in whole or in part, has been disclosed or is threatened to be disclosed. Nothing herein will be construed as prohibiting the Bank from pursuing any other remedies available to the Bank for such breach or threatened breach, including the recovery of damages from Executive.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The provisions of this Section 11 are intended to protect the business, operations and assets of the Bank, and are a material inducement to the Bank to enter into this Agreement. Executive acknowledges that the provisions of this Section 11 are an essential part of this Agreement and are reasonably necessary for the protection of the business, operations and assets of the Bank.

12. SOURCE OF PAYMENTS

All payments provided in this Agreement shall be timely paid in cash or check from the general funds of the Bank.

13. EFFECT ON PRIOR AGREEMENTS AND EXISTING BENEFITS PLANS

This Agreement contains the entire understanding between the parties hereto and supersedes any prior employment agreement between the Bank or any predecessor of the Bank and Executive, except that this Agreement shall not affect or operate to reduce any benefit, compensation, tax indemnification or other provision inuring to the benefit of Executive under any agreement between Executive and the Bank. No provision of this Agreement shall be interpreted to mean that Executive is subject to receiving fewer benefits than those available to him without reference to this Agreement.

14. NO ATTACHMENT

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Except as required by law, no right to receive payments under this Agreement shall be subject to anticipation, commutation, alienation, sale, assignment, encumbrance, charge, pledge, or hypothecation, or to execution, attachment, levy, or similar process or assignment by operation of law, and any attempt, voluntary or involuntary, to effect any such action shall be null, void, and of no effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) This Agreement shall be binding upon, and inure to the benefit of, Executive and the Bank and their respective successors and assigns.

15. MODIFICATION AND WAIVER

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) This Agreement may not be modified or amended except by an instrument in writing signed by the parties hereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) No term or condition of this Agreement shall be deemed to have been waived, nor shall there be any estoppel against the enforcement of any provision of this Agreement, except by written instrument of the party charged with such waiver or estoppel. No written waiver shall be deemed a continuing waiver unless specifically stated therein, and each waiver shall operate only as to the specific term or condition waived and shall not constitute a waiver of such term or condition for the future as to any act other than that specifically waived.

16. REQUIRED PROVISIONS

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Bank may terminate Executive's employment at any time, but any termination by the Board of Directors other than Termination for Just Cause as defined in Section 5 of this Agreement shall not prejudice Executive's right to compensation or other benefits under this Agreement. Executive shall have no right to receive compensation or other benefits for any period after Termination for Just Cause.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Any payments made to Executive pursuant to this Agreement or otherwise are subject to and conditioned upon compliance with 12 U.S.C. Section 1828(k) and any rules and regulations promulgated thereunder, including 12 C.F.R. Part 359, and to the extent applicable, 12 C.F.R. §563.39.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Notwithstanding anything else in this Agreement to the contrary, Executive's employment shall not be deemed to have been terminated unless and until Executive has a Separation from Service within the meaning of Code Section 409A. For purposes of this Agreement, a "Separation from Service" shall have occurred if the Bank and Executive reasonably anticipate that either no further services will be performed by Executive after the date of termination (whether as an employee or as an independent contractor) or the level of further services performed is less than fifty (50) percent of the average level of bona fide services in the thirty-six (36) months immediately preceding the termination. For all purposes hereunder, the definition of Separation from Service shall be interpreted consistent with Treasury Regulation Section 1.409A-1(h)(ii).

17. SEVERABILITY

If, for any reason, any provision of this Agreement, or any part of any provision, is held invalid, such invalidity shall not affect any other provisions of this Agreement or any part of such provision not held so invalid, and each such other provision and part thereof shall to the full extent consistent with law continue in full force and effect.

18. HEADINGS FOR REFERENCE ONLY

The headings of sections and paragraphs herein are included solely for convenience of reference and shall not control the meaning or interpretation of any of the provisions of this Agreement.

19. GOVERNING LAW

This Agreement shall be governed by the laws of the State of Ohio, without regard to its conflict of law principles, unless superseded by federal law or otherwise specified herein.

20. ARBITRATION

Any dispute or controversy arising under or in connection with this Agreement shall be settled exclusively by binding arbitration, as an alternative to civil litigation and without any trial by jury to resolve such claims, conducted by a single arbitrator sitting in a location selected by Executive and the Bank within fifty (50) miles from the main office of the Bank, in accordance with the rules of the American Arbitration Bank's National Rules for the Resolution of Employment Disputes ("National Rules") then in effect. The Bank shall provide a list of three or more arbitrators to Executive from which Executive shall select the arbitrator. If the parties are unable to agree within fifteen (15) days from the date the Bank presents the list to Executive, the arbitrator shall be appointed for them from a panel of arbitrators selected in accordance with the National Rules. Judgment may be entered on the arbitrator's award in any court having jurisdiction.

21. PAYMENT OF COSTS AND LEGAL FEES AND REINSTATEMENT OF BENEFITS

In the event any dispute or controversy arising under or in connection with Executive's termination is resolved in favor of Executive, whether by judgment, arbitration or settlement, Executive shall be entitled to the payment of: (i) all legal fees incurred by Executive in resolving the dispute or controversy; (ii) any back-pay, including salary, bonuses and any other cash compensation, fringe benefits and any compensation and benefits due Executive under this Agreement; and (iii) any other compensation otherwise due Executive as a result of a breach of this Agreement by the Bank. In the event any dispute or controversy arising under or in connection with Executive's termination is resolved in favor of the Bank, whether by judgment, arbitration or settlement, each party shall be responsible for its own legal fees incurred in resolving such dispute or controversy.

22. INDEMNIFICATION

The Bank shall provide Executive (including his heirs, executors, and administrators) with coverage under a standard directors' and officers' liability insurance policy at its expense. The Bank shall indemnify Executive (and his heirs, executors and administrators) to the fullest extent permitted under its Articles of Incorporation, Bylaws and applicable law against all expenses and liabilities reasonably incurred by him in connection with or arising out of any action, suit or proceeding in which he may be involved by reason of his having been a director or officer of the Bank (whether or not he continues to be a director or officer at the time of incurring the expenses or liabilities), the expenses and liabilities to include, but not be limited to, advancement of legal fees and expenses, judgments, court costs and attorneys' fees and the cost of reasonable settlements. Any such indemnification shall be made consistent with Section 18(k) of the Federal Deposit Insurance Act, 12 U.S.C. §1828(k), and the regulations issued thereunder in 12 C.F.R. Part 359.

23. SUCCESSOR TO THE BANK

The Bank shall require any successor or assignee, whether direct or indirect, by purchase, merger, consolidation or otherwise, to all or substantially all the business or assets of the Bank, expressly and unconditionally to assume and agree to perform the Bank's obligations under this Agreement, in the same manner and to the same extent that the Bank would be required to perform if no such succession or assignment had taken place.

24. NON-WAIVER

The failure of one party to insist upon or enforce strict performance by the others of any provision of this Agreement or to exercise any right, remedy or provision of this Agreement will not be interpreted or construed as a waiver or relinquishment to any extent of such party's right to enforce or rely upon same in that or any other instance.

IN WITNESS WHEREOF the Bank and Executive have signed (or caused to be signed) this Agreement on the day and year set forth above.

---

| | |
|:---|:---|
| Attest: | **Mercer Savings Bank** |
|  | By: |
| Secretary | Title: Chairman of the Board of Directors |
| Attest: | **EXECUTIVE** |
| Secretary | Alvin B. Parmiter |

---

## Exhibit 10.2

**Exhibit 10.2**

Mercer Savings Bank

Director Retirement Agreement

**MERCER SAVINGS BANK**

**DIRECTOR RETIREMENT AGREEMENT**

THIS DIRECTOR RETIREMENT AGREEMENT (the "Agreement") is adopted this 18th day of October, 2013, by and between Mercer Savings Bank, a savings association located in Celina, Ohio (the "Bank") and Kristin Fee (the "Director").

The purpose of this Agreement is to provide specified benefits to the Director, a member of the Board of Directors who contributes materially to the continued growth, development and future business success of the Bank.

**Article 1**

**Definitions**

Whenever used in this Agreement, the following words and phrases shall have the meanings specified:

1.1 " <u>Accrual Balance</u> " means the liability that should be accrued by the Bank, under Generally
 Accepted Accounting Principles ("GAAP"), for the Bank's obligation to the
 Director under this Agreement, by applying Accounting Principles Board Opinion Number 12
 ("APB 12") as amended by Statement of Financial Accounting Standards Number 106
 ("FAS 106") and the Discount Rate. Any one of a variety of amortization methods
 may be used to determine the Accrual Balance. However, once chosen, the method must be consistently
 applied. The Accrual Balance shall be reported annually by the Bank to the Director.

1.2 " <u>Beneficiary</u> "
 means each designated person, or the estate of the deceased Director, entitled to benefits,
 if any, upon the death of the Director determined pursuant to Article 4.

1.3 " <u>Beneficiary Designation Form</u> " means the form established from time to time by the Plan Administrator
 that the Director completes, signs, and returns to the Plan Administrator to designate one
 or more Beneficiaries.

1.4 " <u>Board</u> "
 means the Board of Directors of the Bank as from time to time constituted.

1.5 " <u>Change of Control</u> " means the transfer of shares of the Bank's voting common stock
 such that one entity or one person acquires (or is deemed to acquire when applying Section
 318 of the Code) more than fifty percent (50%) of the Bank's outstanding voting common
 stock followed within twelve (12) months by the Director's Separation from Service
 for reasons other than death, Disability or retirement. Since the Bank is chartered under
 the mutual form of ownership, refer to Section 9.7 for guidance in the event of a merger
 or consolidation into or with another company, reorganization, or the sale of substantially
 all of its assets to another form or person.

Mercer Savings Bank

Director Retirement Agreement

1.6 " <u>Code</u> "
 means the Internal Revenue Code of 1986, as amended.

1.7 " <u>Disability</u> "
 means the Director: (i) is unable to engage in any substantial gainful activity by reason
 of any medically determinable physical or mental impairment which can be expected to result
 in death or can be expected to last for a continuous period of not less than twelve (12)
 months; or (ii) is, by reason of any medically determinable physical or mental impairment
 which can be expected to result in death or can be expected to last for a continuous period
 of not less than twelve (12) months, receiving income replacement benefits for a period of
 not less than three (3) months under an accident and health plan covering employees or directors
 of the Bank. Medical determination of Disability may be made by either the Social Security
 Administration or by the provider of an accident or health plan covering employees or directors
 of the Bank provided that the definition of "disability" applied under such disability
 insurance program complies with the requirements of the preceding sentence. Upon the request
 of the Plan Administrator, the Director must submit proof to the Plan Administrator of the
 Social Security Administration's or the provider's determination.

1.8 " <u>Early Termination</u> " means Separation from Service prior to Normal Retirement Age for reasons
 other than death, Disability, Termination for Cause or within twenty four (24) months following
 a Change of Control.

1.9 " <u>Effective Date</u> " means July 24, 2013.

1.10 " <u>Fees</u> "
 means the total fees payable to the Director during a Plan Year.

1.11 " <u>Normal Retirement Age</u> " means the first January Board meeting after the Director attains
 age seventy one (71).

1.12 " <u>Normal Retirement Date</u> " means the later of Normal Retirement Age or Separation from Service
 or end of current term.

1.13 " <u>Plan Administrator</u> " means the plan administrator described in Article 8.

1.14 " <u>Plan Year</u> " means each twelve (12) month period commencing on January 1 and ending on
 December 31 of each year. The initial Plan Year shall commence on the Effective Date of this
 Agreement and end on the following December 31.

1.15 " <u>Schedule A</u> " means the schedule attached to this Agreement and made a part hereof. Schedule
 A shall be updated upon a change in any of the benefits under Articles 2 or 3.

1.16 " <u>Separation from Service</u> " means the termination of the Director's service with the Bank
 for reasons other than death. Whether a Separation from Service takes place is determined
 based on the facts and circumstances surrounding the termination of the Director's
 service and whether the Bank and the Director intended for the Director to provide significant
 services for the Bank following such termination.

Mercer Savings Bank

Director Retirement Agreement

1.17 " <u>Specified Employee</u> " means a key employee (as defined in Section 416(i) of the Code without
 regard to paragraph 5 thereof) of the Bank if any stock of the Bank is publicly traded on
 an established securities market or otherwise.

1.18 " <u>Termination for Cause</u> " means the definition as stated in Section 5.2.

1.19 " <u>Years of Service</u> " means a period of twelve (12) consecutive months during which the Director
 has been a member of the Board. The Director's first Year of Service shall begin with
 the month of the Director's election to the Board and end twelve (12) months later.
 Additional Years of Service, if any, will be counted for each consecutive twelve (12) month
 period thereafter that begins on the same month as the Director's first Year of Service.
 If there are any approved leaves of absences, the Director shall be considered continuously
 a member of the Board for purposes of this Agreement. The Director's appointment to
 the Board was May 21, 2013.

**Article 2**

**Lifetime Benefits**

2.1 <u>Normal Retirement Annual Benefit</u>. Upon Separation from Service on or after the Normal Retirement
 Age for reasons other than death, the Bank shall distribute to the Director the benefit described
 in this Section 2.1 in lieu of any other benefit under this Article.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1.1 <u>Amount of Benefit</u>. The benefit under this Section 2.1 is the amount set forth on Schedule A
 for the Plan Year ending immediately prior to the Normal Retirement Date, determined be vesting
 the Director in thirty-three percent (33%) of the Normal Retirement Annual Benefit after
 six Years of Service to the Board through Year 10, sixty-six percent (66%) of the Normal
 Retirement Annual Benefit after year 10 and through Year 18 and one hundred percent (100%)
 of the Normal Retirement Annual Benefit after Year 18. Service on the Board prior to the
 Effective Date of this Agreement shall be credited for the purposes of defining the benefit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1.2 <u>Distribution of Benefit</u>. The Bank shall distribute the benefit to the Director in twelve (12) equal
 monthly installments commencing on the first day of the month following Normal Retirement
 Date. The annual benefit shall be distributed to the Director for ten (10) years.

2.2 <u>Early Termination Benefit</u>. Upon Early Termination, the Bank shall distribute to the Director
 the benefit described in this Section 2.2 in lieu of any other benefit under this Article.

Mercer Savings Bank

Director Retirement Agreement

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2.1 <u>Amount of Benefit</u>. The annual benefit under this Section 2.2 is the amount set forth on Schedule
 A for the Plan Year ending immediately prior to the Separation from Service, determined be
 vesting the Director in thirty-three percent (33%) of the Accrual Balance after six Years
 of Service to the Board through Year 10, sixty-six percent (66%) of the Accrual Balance after
 year 10 and through Year 18 and one hundred percent (100%) of the Accrual Balance after Year
 18. Service on the Board prior to the Effective Date of this Agreement shall be credited
 for the purposes of defining the benefit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2.2 <u>Distribution of Benefit</u>. The Bank shall distribute the benefit to the Director in a lump sum within
 sixty (60) days after Separation from Service.

2.3 <u>Disability Benefit</u>. If the Director experiences a Disability prior to Normal Retirement Age, the
 Bank shall distribute to the Director the benefit described in this Section 2.3 in lieu of
 any other benefit under this Article.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3.1 <u>Amount of Benefit</u>. The annual benefit under this Section 2.3 is the Fees for the Plan Year ending
 immediately prior to the date in which the Disability occurs. The Director will be one hundred
 percent (100%) vested in the benefit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3.2 <u>Distribution of Benefit</u>. The Bank shall distribute the benefit to the Director in twelve (12) equal
 monthly installments commencing on the first day of the month following the Disability. The
 annual benefit shall be distributed to the Director for ten (10) years.

2.4 <u>Change of Control Benefit</u>. Upon a Change of Control followed within twenty-four (24) months
 by a Separation from Service, the Bank shall distribute to the Director the benefit described
 in this Section 2.4 in lieu of any other benefit under this Article.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4.1 <u>Amount of Benefit</u>. The benefit under this Section 2.4 is the amount set forth on Schedule A
 for the Plan Year ending immediately prior to the date in which the Separation from Service
 occurs (except during the first Plan Year, the benefit is the amount set forth for Plan Year
 1), except by vesting the Director one hundred percent (100%) in the Normal Retirement Benefit
 described in Section 2.1.1.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4.2 <u>Distribution of Benefit</u>. The Bank shall distribute the benefit to the Director in a lump sum within
 sixty (60) days after Separation from Service.

2.5 <u>Restriction on Timing of Distribution</u>. Notwithstanding any provision of this Agreement to the contrary,
 if the Director is considered a Specified Employee at Separation from Service under such
 procedures as established by the Bank in accordance with Section 409A of the Code, benefit
 distributions that are made upon Separation from Service may not commence earlier than six
 (6) months after the date of such Separation from Service. Therefore, in the event this
 Section 2.5 is applicable to the Director, any distribution which would otherwise be paid
 to the Director within the first six months following the Separation from Service shall be
 accumulated and paid to the Director in a lump sum on the first day of the seventh month
 following the Separation from Service. All subsequent distributions shall be paid in the
 manner specified.

Mercer Savings Bank

Director Retirement Agreement

2.6 <u>Distributions Upon Income Inclusion Under Section 409A of the Code</u>. Upon the inclusion of any portion
 of the Accrual Balance into the Director's income as a result of the failure of this
 non-qualified deferred compensation plan to comply with the requirements of Section 409A
 of the Code, to the extent such tax liability can be covered by the Accrual Balance, a distribution
 shall be made as soon as is administratively practicable following the discovery of the plan
 failure.

2.7 <u>Change in Form or Timing of Distributions</u>. For distribution of benefits under this Article 2,
 the Director and the Bank may, subject to the terms of Section 8.1, amend the Agreement to
 delay the timing or change the form of distributions. Any such amendment:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) may
 not accelerate the time or schedule of any distribution, except as provided in Section 409A
 of the Code and the regulations thereunder;

(b) must,
 for benefits distributable under Sections 2.1, 2.2, 2.3 and 2.4, delay the commencement of
 distributions for a minimum of five (5) years from the date the first distribution was originally
 scheduled to be made; <u>and</u> 

(c) must
 take effect not less than twelve (12) months after the amendment is made.

**Article 3**

**Distribution at Death**

3.1 <u>Death During Active Service</u>. If the Director dies while in the active service of the Bank,
 the Bank shall distribute to the Beneficiary the benefit described in this Section 3 .1.
 This benefit shall be distributed in lieu of the Lifetime Benefits of Article 2.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1.1 <u>Amount of Benefit</u>. The annual benefit under this Section 3.1 is the Normal Retirement Benefit.
 The Director is one hundred (100%) vested in the benefit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1.2 <u>Distribution of Benefit</u>. The Bank shall distribute the benefit to the Beneficiary in twelve (12) equal
 monthly installments for ten (10) years commencing the first day of the fourth month following
 the Director's Death. The Beneficiary shall be required to provide to the Bank the
 Director's death certificate.

3.2 <u>Death During Distribution of a Benefit</u>. If the Director dies after any benefit distributions
 have commenced under this Agreement but before receiving all such distributions, the Bank
 shall distribute to the Beneficiary the remaining benefits at the same time and in the same
 amounts that would have been distributed to the Director had the Director survived.

3.3 <u>Death After Separation from Service But Before Benefit Distributions Commence</u>. If the Director
 is entitled to benefit distributions under this Agreement, but dies prior to the commencement
 of said benefit distributions, the Bank shall distribute to the Beneficiary the same benefits
 that the Director was entitled to prior to death except that the benefit payments shall commence
 on the first day of the month following the date of the Director's death.

Mercer Savings Bank

Director Retirement Agreement

**Article 4**

**Beneficiaries**

4.1 <u>Beneficiary</u>.
 The Director shall have the right, at any time, to designate a Beneficiary to receive any
 benefit distributions under this Agreement upon the death of the Director. The Beneficiary
 designated under this Agreement may be the same as or different from the beneficiary designated
 under any other plan of the Bank in which the Director participates.

4.2 <u>Beneficiary Designation: Change</u>. The Director shall designate a Beneficiary by completing and signing
 the Beneficiary Designation Form, and delivering it to the Plan Administrator or its designated
 agent. The Director's beneficiary designation shall be deemed automatically revoked
 if the Beneficiary predeceases the Director or if the Director names a spouse as Beneficiary
 and the marriage is subsequently dissolved. The Director shall have the right to change a
 Beneficiary by completing, signing and otherwise complying with the terms of the Beneficiary
 Designation Form and the Plan Administrator's rules and procedures, as in effect from
 time to time. Upon the acceptance by the Plan Administrator of a new Beneficiary Designation
 Form, all Beneficiary designations previously filed shall be cancelled. The Plan Administrator
 shall be entitled to rely on the last Beneficiary Designation Form filed by the Director
 and accepted by the Plan Administrator prior to the Director's death.

4.3 <u>Acknowledgment</u>.
 No designation or change in designation of a Beneficiary shall be effective until received,
 accepted and acknowledged in writing by the Plan Administrator or its designated agent.

4.4 <u>No Beneficiary Designation</u>. If the Director dies without a valid beneficiary designation,
 or if all designated Beneficiaries predecease the Director, then the Director's spouse
 shall be the designated Beneficiary. If the Director has no surviving spouse, the benefits
 shall be made to the personal representative of the Director's estate.

4.5 <u>Facility of Distribution</u>. If the Plan Administrator determines in its discretion that a benefit
 is to be distributed to a minor, to a person declared incompetent, or to a person incapable
 of handling the disposition of that person's property, the Plan Administrator may direct
 distribution of such benefit to the guardian, legal representative or person having the care
 or custody of such minor, incompetent person or incapable person. The Plan Administrator
 may require proof of incompetence, minority or guardianship as it may deem appropriate prior
 to distribution of the benefit. Any distribution of a benefit shall be a distribution for
 the account of the Director and the Director's Beneficiary, as the case may be, and
 shall be a complete discharge of any liability under the Agreement for such distribution
 amount.

Mercer Savings Bank

Director Retirement Agreement

**Article 5**

**General Limitations**

5.1 <u>Parachute Payments</u>. Notwithstanding any provision of this Agreement to the contrary, the Bank shall
 not pay any benefit under this Agreement to the extent the benefit would create an excise
 tax under the excess parachute rules of Section 280G of the Code.

5.2 <u>Termination for Cause</u>. Notwithstanding any provision of this Agreement to the contrary, the Bank
 shall not distribute any benefit under this Agreement if the Bank terminates the Director's
 service for:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Gross
 negligence or gross neglect of duties to the Bank; or

(b) Commission
 of a felony or of a gross misdemeanor involving moral turpitude in connection with the Director's
 service with the Bank; or

(c) Fraud,
 disloyalty, dishonesty or willful violation of any law or significant Bank policy committed
 in connection with the Director's service and resulting in a material adverse effect
 on the Bank.

5.3 <u>Suicide or Misstatement</u>. No benefits shall be distributed if the Director commits suicide within
 two years after the Effective Date of this Agreement, or if an insurance company which issued
 a life insurance policy covering the Director and owned by the Bank denies coverage (i) for
 material misstatements of fact made by the Director on an application for such life insurance,
 or (ii) for any other reason.

5.4 <u>Removal</u>.
 Notwithstanding any provision of this Agreement to the contrary, the Bank shall not distribute
 any benefit under this Agreement if the Director is subject to a final removal or prohibition
 order issued by an appropriate federal banking agency pursuant to Section 8(e) of the Federal
 Deposit Insurance Act.

**Article 6**

**Claims And Review Procedures**

6.1 <u>Claims Procedure</u>. A Director or Beneficiary ("claimant") who has not received benefits
 under the Agreement that he or she believes should be distributed shall make a claim for
 such benefits as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1.1 <u>Initiation - Written Claim</u>. The claimant initiates a claim by submitting to the Plan Administrator
 a written claim for the benefits. If such a claim relates to the contents of a notice received
 by the claimant, the claim must be made within sixty (60) days after such notice was received
 by the claimant. All other claims must be made within one hundred eighty (180) days of the
 date on which the event that caused the claim to arise occurred. The claim must state with
 particularity the determination desired by the claimant.

Mercer Savings Bank

Director Retirement Agreement

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1.2 <u>Timing of Plan Administrator Response</u>. The Plan Administrator shall respond to such claimant
 within ninety (90) days after receiving the claim. If the Plan Administrator determines that
 special circumstances require additional time for processing the claim, the Plan Administrator
 can extend the response period by an additional ninety (90) days by notifying the claimant
 in writing, prior to the end of the initial ninety (90) day period, that an additional period
 is required. The notice of extension must set forth the special circumstances and the date
 by which the Plan Administrator expects to render its decision.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1.3 <u>Notice of Decision</u>. If the Plan Administrator denies part or all of the claim, the Plan Administrator
 shall notify the claimant in writing of such denial. The Plan Administrator shall write the
 notification in a manner calculated to be understood by the claimant. The notification shall
 set forth:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The
 specific reasons for the denial;

(b) A
 reference to the specific provisions of the Agreement on which the denial is based;

(c) A
 description of any additional information or material necessary for the claimant to perfect
 the claim and an explanation of why it is needed; and

(d) An
 explanation of the Agreement's review procedures and the time limits applicable to
 such procedures.

6.2 <u>Review Procedure</u>. If the Plan Administrator denies part or all of the claim, the claimant shall
 have the opportunity for a full and fair review by the Plan Administrator of the denial,
 as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2.1 <u>Initiation - Written Request</u>. To initiate the review, the claimant, within 60 days after receiving
 the Plan Administrator's notice of denial, must file with the Plan Administrator a
 written request for review.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2.2 <u>Additional Submissions - Information Access</u>. The claimant shall then have the opportunity to submit
 written comments, documents, records and other information relating to the claim. The Plan
 Administrator shall also provide the claimant, upon request and free of charge, reasonable
 access to, and copies of, all documents, records and other information relevant to the claimant's
 claim for benefits.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2.3 <u>Considerations on Review</u>. In considering the review, the Plan Administrator shall take into account
 all materials and information the claimant submits relating to the claim, without regard
 to whether such information was submitted or considered in the initial benefit determination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2.4 <u>Timing of Plan Administrator Response</u>. The Plan Administrator shall respond in writing to such
 claimant within sixty (60) days after receiving the request for review. If the Plan Administrator
 determines that special circumstances require additional time for processing the claim, the
 Plan Administrator can extend the response period by an additional sixty (60) days by notifying
 the claimant in writing, prior to the end of the initial sixty (60) day period, that an additional
 period is required. The notice of extension must set forth the special circumstances and
 the date by which the Plan Administrator expects to render its decision.

Mercer Savings Bank

Director Retirement Agreement

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2.5 <u>Notice of Decision</u>. The Plan Administrator shall notify the claimant in writing of its decision
 on review. The Plan Administrator shall write the notification in a manner calculated to
 be understood by the claimant. The notification shall set forth:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The
 specific reasons for the denial;

(b) A
 reference to the specific provisions of the Agreement on which the denial is based;

(c) A
 statement that the claimant is entitled to receive, upon request and free of charge, reasonable
 access to, and copies of, all documents, records and other information relevant to the claimant's
 claim for benefits; and

(d) A
 statement of the claimant's right to bring a civil action.

**Article 7**

**Amendments and Termination**

7.1 <u>Amendments</u>.
 This Agreement may be amended only by a written agreement signed by the Bank and the Director.
 However, the Bank may unilaterally amend this Agreement (i) to conform with written directives
 to the Bank from its auditors or banking regulators or to comply with legislative changes
 or tax law, including without limitation Section 409A of the Code and any and all Treasury
 regulations and guidance promulgated thereunder or (ii) if pursuant to legislative, judicial
 or regulatory action, continuation of the Agreement would (a) cause benefits to be taxable
 to the Director prior to actual receipt, or (b) result in significant financial penalties
 or other significantly detrimental ramifications to the Bank (other than the financial impact
 of paying the benefits).

7.2 <u>Plan Termination Generally</u>. The Bank and Director may terminate this Agreement at any time.
 However, the Bank may unilaterally terminate this Agreement if pursuant to legislative, judicial
 or regulatory action, continuation of the Agreement would (a) cause benefits to be taxable
 to the Director prior to actual receipt, or (b) result in significant financial penalties
 or other significantly detrimental ramifications to the Bank (other than the financial impact
 of paying the benefits). Except as provided in Section 7.3, the termination of this Agreement
 shall not cause a distribution of benefits under this Agreement. Rather, upon such termination
 benefit distributions will be made at the earliest distribution event permitted under Article
 2 or Article 3.

Mercer Savings Bank

Director Retirement Agreement

7.3 <u>Plan Terminations Under Section 409A</u>. Notwithstanding anything to the contrary in Section
 7.2, if the Bank terminates this Agreement in the following circumstances:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Within
 thirty (30) days before, or twelve (12) months after a change in the ownership or effective
 control of the Bank, or in the ownership of a substantial portion of the assets of the Bank
 as described in Section 409A(2)(A)(v) of the Code, provided that all distributions are made
 no later than twelve (12) months following such termination of the Agreement and further
 provided that all the Bank's arrangements which are substantially similar to the Agreement
 are terminated so the Director and all participants in the similar arrangements are required
 to receive all amounts of compensation deferred under the terminated arrangements within
 twelve (12) months of the termination of the arrangements;

(b) Upon
 the Bank's dissolution or with the approval of a bankruptcy court provided that the
 amounts deferred under the Agreement are included in the Director's gross income in
 the latest of (i) the calendar year in which the Agreement terminates; (ii) the calendar
 year in which the amount is no longer subject to a substantial risk of forfeiture; or (iii)
 the first calendar year in which the distribution is administratively practical; or

(c) Upon
 the Bank's termination of this and all other arrangements that would be aggregated
 with this Agreement pursuant to Treasury Regulations Section l.409A-l(c) if the Director
 participated in such arrangements ("Similar Arrangements"), provided that (i)
 the termination and liquidation does not occur proximate to a downturn in the financial health
 of the Bank, (ii) all termination distributions are made no earlier than twelve (12) months
 and no later than twenty-four (24) months following such termination, and (iii) the Bank
 does not adopt any new arrangement that would be a Similar Arrangement for a minimum of three
 (3) years following the date the Bank takes all necessary action to irrevocably terminate
 and liquidate the Agreement;

the Bank may distribute the vested Accrual Balance, determined as of the date of the termination of the Agreement, to the Director in a lump sum subject to the above terms.

**Article 8**

**Administration of Agreement**

8.1 <u>Plan Administrator Duties</u>. This Agreement shall be administered by a Plan Administrator which
 shall consist of the Board, or such committee or person(s) as the Board shall appoint. The
 Plan Administrator shall administer this Agreement according to its express terms and shall
 also have the discretion and authority to (i) make, amend, interpret and enforce all appropriate
 rules and regulations for the administration of this Agreement and (ii) decide or resolve
 any and all questions including interpretations of this Agreement, as may arise in connection
 with the Agreement to the extent the exercise of such discretion and authority does not conflict
 with Section 409 A of the Code and regulations thereunder.

8.2 <u>Agents</u>.
 In the administration of this Agreement, the Plan Administrator may employ agents and delegate
 to them such administrative duties as it sees fit, (including acting through a duly appointed
 representative), and may from time to time consult with counsel who may be counsel to the
 Bank.

Mercer Savings Bank

Director Retirement Agreement

8.3 <u>Binding Effect of Decisions</u>. The decision or action of the Plan Administrator with respect to
 any question arising out of or in connection with the administration, interpretation and
 application of the Agreement and the rules and regulations promulgated hereunder shall be
 final and conclusive and binding upon all persons having any interest in the Agreement.

8.4 <u>Indemnity of Plan Administrator</u>. The Bank shall indemnify and hold harmless the members of the
 Plan Administrator against any and all claims, losses, damages, expenses or liabilities arising
 from any action or failure to act with respect to this Agreement, except in the case of willful
 misconduct by the Plan Administrator or any of its members.

8.5 <u>Bank Information</u>. To enable the Plan Administrator to perform its functions, the Bank shall
 supply full and timely information to the Plan Administrator on all matters relating to the
 date and circumstances of the retirement, Disability, death, or Separation from Service of
 the Director, and such other pertinent information as the Plan Administrator may reasonably
 require.

8.6 <u>Annual Statement</u>. The Plan Administrator shall provide to the Director, within one hundred twenty
 (120) days after the end of each Plan Year, a statement setting forth the benefits to be
 distributed under this Agreement.

**Article 9**

**Miscellaneous**

9.1 <u>Binding Effect</u>. This Agreement shall bind the Director and the Bank, and their beneficiaries,
 survivors, executors, administrators and transferees.

9.2 <u>No Guarantee of Service</u>. This Agreement is not a contract for service. It does not give
 the Director the right to remain as a director of the Bank, nor does it interfere with the
 Bank's right to discharge the Director. It also does not require the Director to remain
 a director nor interfere with the Director's right to terminate service at any time.

9.3 <u>Non-Transferability</u>.
 Benefits under this Agreement cannot be sold, transferred, assigned, pledged, attached or
 encumbered in any manner.

9.4 <u>Tax Withholding and Reporting</u>. The Bank shall withhold any taxes that are required to be
 withheld, including but not limited to taxes owed under Section 409 A of the Code and regulations
 thereunder, from the benefits provided under this Agreement. The Director acknowledges that
 the Bank's sole liability regarding taxes is to forward any amounts withheld to the
 appropriate taxing authority(ies). Further, the Bank shall satisfy all applicable reporting
 requirements, including those under Section 409A of the Code and regulations thereunder.

Mercer Savings Bank

Director Retirement Agreement

9.5 <u>Applicable Law</u>. The Agreement and all rights hereunder shall be governed by the laws of the State
 of Ohio, except to the extent preempted by the laws of the United States of America.

9.6 <u>Unfunded Arrangement</u>. The Director and the Beneficiary are general unsecured creditors of the
 Bank for the distribution of benefits under this Agreement. The benefits represent the mere
 promise by the Bank to distribute such benefits. The rights to benefits are not subject in
 any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance,
 attachment, or garnishment by creditors. Any insurance on the Director's life or other
 informal funding asset is a general asset of the Bank to which the Director and Beneficiary
 have no preferred or secured claim.

9.7 <u>Reorganization</u>.
 The Bank shall not merge or consolidate into or with another bank, or reorganize, or sell
 substantially all of its assets to another bank, firm, or person unless such succeeding or
 continuing bank, firm, or person agrees to assume and discharge the obligations of the Bank
 under this Agreement. Upon the occurrence of such event, the term "Bank" as used
 in this Agreement shall be deemed to refer to the successor or survivor bank.

9.8 <u>Entire Agreement</u>. This Agreement constitutes the entire agreement between the Bank and the Director
 as to the subject matter hereof. No rights are granted to the Director by virtue of this
 Agreement other than those specifically set forth herein.

9.9 <u>Interpretation</u>.
 Wherever the fulfillment of the intent and purpose of this Agreement requires, and the context
 will permit, the use of the masculine gender includes the feminine and use of the singular
 includes the plural.

9.10 <u>Alternative Action</u>. In the event it shall become impossible for the Bank or the Plan Administrator
 to perform any act required by this Agreement, the Bank or Plan Administrator may in its
 discretion perform such alternative act as most nearly carries out the intent and purpose
 of this Agreement and is in the best interests of the Bank, provided that such alternative
 acts do not violate Section 409A of the Code.

9.11 <u>Headings</u>.
 Article and section headings are for convenient reference only and shall not control or affect
 the meaning or construction of any of its provisions.

9.12 <u>Validity</u>.
 In case any provision of this Agreement shall be illegal or invalid for any reason, said
 illegality or invalidity shall not affect the remaining parts hereof, but this Agreement
 shall be construed and enforced as if such illegal and invalid provision has never been inserted
 herein.

Mercer Savings Bank

Director Retirement Agreement

9.13 <u>Notice</u>.
 Any notice or filing required or permitted to be given to the Bank or Plan Administrator
 under this Agreement shall be sufficient if in writing and hand-delivered, or sent by registered
 or certified mail, to the address below:

<u>Mercer Savings Bank</u> <br> <u>1100 Irmscher Blvd.</u> <br> <u>Celina, OH 45822</u>

Such notice shall be deemed given as of the date of delivery or, if delivery is made by mail, as of the date shown on the postmark on the receipt for registration or certification.

Any notice or filing required or permitted to be given to the Director under this Agreement shall be sufficient if in writing and hand-delivered, or sent by mail, to the last known address of the Director.

---

| | |
|:---|:---|
| 9.14 | <u>Compliance with Section 409A</u>. This Agreement shall at all times be administered and the provisions of this Agreement shall be interpreted consistent with the requirements of Section 409A of the Code and any and all regulations thereunder, including such regulations as may be promulgated after the Effective Date of this Agreement. |
|  | IN WITNESS WHEREOF, the Director and a duly authorized representative of the Bank have signed this Agreement. |

---

---

| | | |
|:---|:---|:---|
| **DIRECTOR:** | **BANK:** | **BANK:** |
|  | **Mercer Savings Bank** | **Mercer Savings Bank** |
| /s/ Kristin Fee | **By** | /s/ William U. Martin |
| **Kristin Fee** |  |  |
|  | **Title** | PRESIDENT / CEO |

---

## Exhibit 10.3

**Exhibit 10.3**

**MERCER SAVINGS BANK**

**DIRECTOR RETIREMENT AGREEMENT**

THIS DIRECTOR RETIREMENT AGREEMENT (the "Agreement") is adopted this 20th day of May, 2014, by and between Mercer Savings Bank, a savings association located in Celina, Ohio (the "Bank") and David L. Keiser (the "Director").

The purpose of this Agreement is to provide specified benefits to the Director, a member of the Board of Directors who contributes materially to the continued growth, development and future business success of the Bank.

**Article 1**

**Definitions**

Whenever used in this Agreement, the following words and phrases shall have the meanings specified:

1.1 " <u>Accrual Balance</u> " means the liability that should be accrued by the Bank, under Generally
Accepted Accounting Principles ("GAAP"), for the Bank's obligation to the Director under this Agreement, by applying
Accounting Principles Board Opinion Number 12 ("APB 12") as amended by Statement of Financial Accounting Standards Number
106 ("FAS 106") and the Discount Rate. Any one of a variety of amortization methods may be used to determine the Accrual Balance.
However, once chosen, the method must be consistently applied. The Accrual Balance shall be reported annually by the Bank to the Director.

1.2 " <u>Beneficiary</u> " means each designated person, or the estate of the deceased Director,
entitled to benefits, if any, upon the death of the Director determined pursuant to Article 4.

1.3 " <u>Beneficiary Designation Form</u> " means the form established from time to time by the
Plan Administrator that the Director completes, signs, and returns to the Plan Administrator to designate one or more Beneficiaries.

1.4 " <u>Board</u> " means the Board of Directors of the Bank as from time to time constituted.

1.5 " <u>Change of Control</u> " means the transfer of shares of the Bank's voting common
stock such that one entity or one person acquires (or is deemed to acquire when applying Section 318 of the Code) more than fifty percent
(50%) of the Bank's outstanding voting common stock followed within twelve (12) months by the Director's Separation from Service
for reasons other than death, Disability or retirement. Since the Bank is chartered under the mutual form of ownership, refer to Section
9.7 for guidance in the event of a merger or consolidation into or with another company, reorganization, or the sale of substantially
all of its assets to another form or person.

1.6 " <u>Code</u> " means the Internal Revenue Code of 1986, as amended.

 

 

1.7 " <u>Disability</u> *"* means the Director:
(i) is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which
can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months; or (ii) is,
by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to
last for a continuous period of not less than twelve (12) months, receiving income replacement benefits for a period of not less than
three (3) months under an accident and health plan covering employees or directors of the Bank. Medical determination of Disability may
be made by either the Social Security Administration or by the provider of an accident or health plan covering employees or directors
of the Bank provided that the definition of "disability" applied under such disability insurance program complies with the
requirements of the preceding sentence. Upon the request of the Plan Administrator, the Director must submit proof to the Plan Administrator
of the Social Security Administration's or the provider's determination.

1.8 " <u>Early Termination</u> " means Separation from Service prior to Normal Retirement Age for
reasons other than death, Disability, Termination for Cause or within twenty four (24) months following a Change of Control.

1.9 " <u>Effective Date</u> " means May 1, 2014.

1.10 " <u>Fees</u> " means the total fees payable to the Director during a Plan Year.

1.11 " <u>Normal Retirement Age</u> " means the first January Board meeting after the Director attains
age seventy two (72).

1.12 " <u>Normal Retirement Date</u> " means the later of Normal Retirement Age or Separation from
Service or end of current term.

1.13 " <u>Plan Administrator</u> " means the plan administrator described in Article 8.

1.14 " <u>Plan Year</u> " means each twelve (12) month period commencing on January 1 and ending
on December 31 of each year. The initial Plan Year shall commence on the Effective Date of this Agreement and end on the following December
31. 1.15 " <u>Schedule A</u> " means the schedule attached to this Agreement and made a part hereof.
Schedule A shall be updated upon a change in any of the benefits under Articles 2 or 3.

1.16 " <u>Separation from Service</u> " means the termination of the Director's
service with the Bank for reasons other than death. Whether
a Separation from Service takes place is determined based on the facts and circumstances surrounding the termination of the Director's
service and whether the Bank and the Director intended for the Director to provide significant services for the Bank following such termination.

1.17 " <u>Specified Employee</u> " means a key employee (as defined in Section 416(i) of the Code
without regard to paragraph 5 thereof) of the Bank if any stock of the Bank is publicly traded on an established securities market or
otherwise.

1.18 " <u>Termination for Cause</u> " means the definition as stated in Section 5.2.

1.19 " <u>Years of Service</u> " means a period of twelve (12) consecutive months during which the
Director has been a member of the Board. The Director's first Year of Service shall begin with the month of the Director's
appointment to the Board and end twelve (12) months later. Additional Years of Service, if any, will be counted for each consecutive twelve
(12) month period thereafter that begins on the same month as the Director's first Year of Service. If there are any approved leaves
of absences, the Director shall be considered continuously a member of the Board for purposes of this Agreement. The Director's
appointment to the Board was January 21, 2014.

**Article 2**

**Lifetime Benefits<br>** 

<br> 2.1 <u>Normal Retirement Annual Benefit</u>. Upon Separation from Service on or after the Normal Retirement
Age for reasons other than death, the Bank shall distribute to the Director the benefit described in this Section 2.1 in lieu of any other
benefit under this Article.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1.1 <u>Amount of Benefit</u>. The benefit under this Section 2.1 is the amount set forth on Schedule A for
the Plan Year ending immediately prior to the Normal Retirement Date, determined be vesting the Director in thirty-three percent (33%)
of the Normal Retirement Annual Benefit after six Years of Service to the Board through Year 10, sixty-six percent (66%) of the Normal
Retirement Annual Benefit after year 10 and through Year 18 and one hundred percent (100%) of the Normal Retirement Annual Benefit after
Year 18. Service on the Board prior to the Effective Date of this Agreement shall be credited for the purposes of defining the benefit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1.2 <u>Distribution of Benefit</u>. The Bank shall distribute the benefit to the Director in twelve (12) equal
monthly installments commencing on the first day of the month following Normal Retirement Date. The annual benefit shall be distributed
to the Director for ten (10) years.

2.2 <u>Early Termination Benefit</u>. Upon Early Termination, the Bank shall distribute to the Director the
benefit described in this Section 2.2 in lieu of any other benefit under this Article.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2.1 <u>Amount of Benefit</u>. The annual benefit under this Section 2.2 is the amount set forth on Schedule
A for the Plan Year ending immediately prior to the Separation from Service, determined be vesting the Director in thirty-three percent
(33%) of the Accrual Balance after six Years of Service to the Board through Year 10, sixty-six percent (66%) of the Accrual Balance after
year 10 and through Year 18 and one hundred percent (100%) of the Accrual Balance after Year 18. Service on the Board prior to the Effective
Date of this Agreement shall be credited for the purposes of defining the benefit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2.2 <u>Distribution of Benefit</u>. The Bank shall distribute the benefit to the Director in a lump sum within
sixty (60) days after Separation from Service.

2.3 <u>Disability Benefit</u> *.* If the Director experiences a Disability prior to Normal
 Retirement Age, the Bank shall distribute to the
Director the benefit described in this Section 2.3 in lieu of any other benefit under this Article.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3.1 <u>Amount of Benefit</u> *.* The annual benefit under this Section 2.3 is the Fees for the Plan Year
ending immediately prior to the date in which the Disability occurs. The Director will be one hundred percent (100%) vested in the benefit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3.2 <u>Distribution of Benefit</u> *.* The Bank shall distribute the benefit to the Director in twelve
(12) equal monthly installments commencing on the first day of the month following the Disability. The annual benefit shall be distributed
to the Director for ten (10) years.

2.4 <u>Change of Control Benefit</u>. Upon a Change of Control followed within twenty-four (24) months by
a Separation from Service, the Bank shall distribute to the Director the benefit described in this Section 2.4 in lieu of any other benefit
under this Article.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4.1 <u>Amount of Benefit</u>. The benefit under this Section 2.4 is the amount set forth on Schedule A for
the Plan Year ending immediately prior to the date in which the Separation from Service occurs (except during the first Plan Year, the
benefit is the amount set forth for Plan Year 1), except by vesting the Director one hundred percent (100%) in the Normal Retirement Benefit
described in Section 2.1.1.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4.2 <u>Distribution of Benefit</u>. The Bank shall distribute the benefit to the Director in a lump sum within
sixty (60) days after Separation from Service.

2.5 <u>Restriction on Timing of Distribution</u>. Notwithstanding any provision of this Agreement to
the contrary, if the Director is considered a Specified Employee at Separation from Service under such procedures as established by the
Bank in accordance with Section 409A of the Code, benefit distributions that are made upon Separation from Service may not commence earlier
than six (6) months after the date of such Separation from Service. Therefore, in the event this Section 2.5 is applicable to
the Director, any distribution which would otherwise be paid to the Director within the first six months following the Separation from
Service shall be accumulated and paid to the Director in a lump sum on the first day of the seventh month following the Separation from
Service. All subsequent distributions shall be paid in the manner specified.

2.6 <u>Distributions Upon Income Inclusion Under Section 409A of the Code</u>. Upon the inclusion of any portion
of the Accrual Balance into the Director's income as a result of the failure of this non-qualified deferred compensation plan to
comply with the requirements of Section 409A of the Code, to the extent such tax liability can be covered by the Accrual Balance, a distribution
shall be made as soon as is administratively practicable following the discovery of the plan failure.

2.7 <u>Change in Form or Timing of Distributions</u>. For distribution of benefits under this Article
2, the Director and the Bank may, subject to the terms of Section 8.1, amend the Agreement to delay the timing or change the form of distributions. 
Any such amendment:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) may not accelerate the time or schedule of any distribution, except as provided in Section 409A of the Code
and the regulations thereunder;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) must, for benefits distributable under Sections 2.1, 2.2, 2.3 and 2.4, delay the commencement of distributions
for a minimum of five (5) years from the date the first distribution was originally scheduled to be made; <u>and</u> 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) must take effect not less than twelve (12) months after the amendment is made.

**Article 3**

**Distribution at Death**

3.1 <u>Death During Active Service</u>. If the Director dies while in the active service of the Bank, the
Bank shall distribute to the Beneficiary the benefit described in this Section 3.1. This benefit shall be distributed in lieu of the Lifetime
Benefits of Article 2.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1.1 <u>Amount of Benefit</u>. The annual benefit under this Section 3.1 is the Normal Retirement Benefit.
The Director is one hundred (100%) vested in the benefit, except by vesting the Director one hundred percent (100%) in the Normal Retirement
Benefit described in Section 2.1.1.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1.2 <u>Distribution of Benefit</u>. The Bank shall distribute the benefit to the Beneficiary in twelve (12)
equal monthly installments for ten (10) years commencing the first day of the fourth month following the Director's Death. The Beneficiary
shall be required to provide to the Bank the Director's death certificate.

3.2 <u>Death During Distribution of a Benefit</u>. If the Director dies after any benefit distributions have
commenced under this Agreement but before receiving all such distributions, the Bank shall distribute to the Beneficiary the remaining
benefits at the same time and in the same amounts that would have been distributed to the Director had the Director survived.

3.3 <u>Death After Separation from Service But Before Benefit Distributions Commence</u>. If the Director
is entitled to benefit distributions under this Agreement, but dies prior to the commencement of said benefit distributions, the Bank
shall distribute to the Beneficiary the same benefits that the Director was entitled to prior to death except that the benefit payments
shall commence on the first day of the month following the date of the Director's death.

**Article 4**

**Beneficiaries**

4.1 <u>Beneficiary</u>. The Director shall have the right, at any time, to designate a Beneficiary to receive
any benefit distributions under this Agreement upon the death of the Director. The Beneficiary designated under this Agreement may be
the same as or different from the beneficiary designated under any other plan of the Bank in which the Director participates.

4.2 <u>Beneficiary Designation: Change</u>. The Director shall
designate a Beneficiary by completing and signing the Beneficiary Designation Form, and delivering it to the Plan Administrator or its
designated agent. The Director's beneficiary designation shall be deemed automatically revoked if the Beneficiary predeceases the Director
or if the Director names a spouse as Beneficiary and the marriage is subsequently dissolved. The Director shall have the right to change
a Beneficiary by completing, signing and otherwise complying with the terms of the Beneficiary Designation Form and the Plan Administrator's
rules and procedures, as in effect from time to time. Upon the acceptance by the Plan Administrator of a new Beneficiary Designation
Form, all Beneficiary designations previously filed shall be cancelled. The Plan Administrator shall be entitled to rely on the last
Beneficiary Designation Form filed by the Director and accepted by the Plan Administrator prior to the Director's death.

4.3 <u>Acknowledgment</u>. No designation or change in designation of a Beneficiary shall be effective until
received, accepted and acknowledged in writing by the Plan Administrator or its designated agent.

4.4 <u>No Beneficiary Designation</u>. If the Director dies without a valid beneficiary designation, or if
all designated Beneficiaries predecease the Director, then the Director's spouse shall be the designated Beneficiary. If the Director
has no surviving spouse, the benefits shall be made to the personal representative of the Director's estate.

4.5 <u>Facility of Distribution</u>. If the Plan Administrator determines in its discretion that a benefit
is to be distributed to a minor, to a person declared incompetent, or to a person incapable of handling the disposition of that person's
property, the Plan Administrator may direct distribution of such benefit to the guardian, legal representative or person having the care
or custody of such minor, incompetent person or incapable person. The Plan Administrator may require proof of incompetence, minority or
guardianship as it may deem appropriate prior to distribution of the benefit. Any distribution of a benefit shall be a distribution for
the account of the Director and the Director's Beneficiary, as the case may be, and shall be a complete discharge of any liability
under the Agreement for such distribution amount.

**Article 5**

**General Limitations**

5.1 <u>Parachute Payments</u>. Notwithstanding any provision of this Agreement to the contrary, the Bank shall
not pay any benefit under this Agreement to the extent the benefit would create an excise tax under the excess parachute rules of Section
280G of the Code.

5.2 <u>Termination for Cause</u>. Notwithstanding any provision of this Agreement to the contrary, the Bank
shall not distribute any benefit under this Agreement if the Bank terminates the Director's service for:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Gross negligence or gross neglect of duties to the Bank; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Commission of a felony or of a gross misdemeanor involving moral turpitude in connection with the Director's
service with the Bank; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Fraud, disloyalty, dishonesty or willful violation of any law or significant Bank policy committed in
connection with the Director's service and resulting in a material adverse effect on the Bank.

5.3 <u>Suicide or Misstatement</u>. No benefits shall be distributed if the Director commits suicide within
two years after the Effective Date of this Agreement, or if an insurance company which issued a life insurance policy covering the Director
and owned by the Bank denies coverage (i) for material misstatements of fact made by the Director on an application for such life insurance,
or (ii) for any other reason.

5.4 <u>Removal</u>. Notwithstanding any provision of this Agreement to the contrary, the Bank shall not distribute
any benefit under this Agreement if the Director is subject to a final removal or prohibition order issued by an appropriate federal banking
agency pursuant to Section 8(e) of the Federal Deposit Insurance Act.

**Article 6**

**Claims And Review Procedures**

6.1 <u>Claims Procedure</u>. A Director or Beneficiary ("claimant") who has not received benefits
under the Agreement that he or she believes should be distributed shall make a claim for such benefits as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1.1 <u>Initiation – Written Claim</u>. The claimant initiates a claim by submitting to the Plan Administrator
a written claim for the benefits. If such a claim relates to the contents of a notice received by the claimant, the claim must be made
within sixty (60) days after such notice was received by the claimant. All other claims must be made within one hundred eighty (180) days
of the date on which the event that caused the claim to arise occurred. The claim must state with particularity the determination desired
by the claimant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1.2 <u>Timing of Plan Administrator Response</u>. The Plan Administrator shall respond to such claimant within
ninety (90) days after receiving the claim. If the Plan Administrator determines that special circumstances require additional time for
processing the claim, the Plan Administrator can extend the response period by an additional ninety (90) days by notifying the claimant
in writing, prior to the end of the initial ninety (90) day period, that an additional period is required. The notice of extension must
set forth the special circumstances and the date by which the Plan Administrator expects to render its decision.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1.3 <u>Notice of Decision</u>. If the Plan Administrator denies part or all of the claim, the Plan Administrator
shall notify the claimant in writing of such denial. The Plan Administrator shall write the notification in a manner calculated to be
understood by the claimant. The notification shall set forth:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The specific reasons for the denial;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) A reference to the specific provisions of the Agreement on which the denial is based;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) A description of any additional information or material necessary for the claimant to perfect the claim
and an explanation of why it is needed; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) An explanation of the Agreement's review procedures and the time limits applicable to such procedures.

6.2 <u>Review Procedure</u>. If the Plan Administrator denies part or all of the claim, the claimant shall
have the opportunity for a full and fair review by the Plan Administrator of the denial, as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2.1 <u>Initiation – Written Request</u>. To initiate the review, the claimant, within 60 days after
receiving the Plan Administrator's notice of denial, must file with the Plan Administrator a written request for review.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2.2 <u>Additional Submissions – Information Access</u>. The claimant shall then have the opportunity
to submit written comments, documents, records and other information relating to the claim. The Plan Administrator shall also provide
the claimant, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant
to the claimant's claim for benefits.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2.3 <u>Considerations on Review</u>. In considering the review, the Plan Administrator shall take into account
all materials and information the claimant submits relating to the claim, without regard to whether such information was submitted or
considered in the initial benefit determination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2.4 <u>Timing of Plan Administrator Response</u>. The Plan Administrator shall respond in writing to such
claimant within sixty (60) days after receiving the request for review. If the Plan Administrator determines that special circumstances
require additional time for processing the claim, the Plan Administrator can extend the response period by an additional sixty (60) days
by notifying the claimant in writing, prior to the end of the initial sixty (60) day period, that an additional period is required. The
notice of extension must set forth the special circumstances and the date by which the Plan Administrator expects to render its decision.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2.5 <u>Notice of Decision</u>. The Plan Administrator shall notify the claimant in writing of its decision
on review. The Plan Administrator shall write the notification in a manner calculated to be understood by the claimant. The notification
shall set forth:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The specific reasons for the denial;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) A reference to the specific provisions of the Agreement on which the denial is based;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) A statement that the claimant is entitled to receive, upon request and free of charge, reasonable access
to, and copies of, all documents, records and other information relevant to the claimant's claim for benefits; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) A statement of the claimant's right to bring a civil action.

**Article 7**

**Amendments and Termination**

7.1 <u>Amendments.</u> This Agreement may be amended only by a written agreement signed by the Bank and the
Director. However, the Bank may unilaterally amend this Agreement (i) to conform with written directives to the Bank from its auditors
or banking regulators or to comply with legislative changes or tax law, including without limitation Section 409A of the Code and any
and all Treasury regulations and guidance promulgated thereunder or (ii) if pursuant to legislative, judicial or regulatory action, continuation
of the Agreement would (a) cause benefits to be taxable to the Director prior to actual receipt, or (b) result in significant financial
penalties or other significantly detrimental ramifications to the Bank (other than the financial impact of paying the benefits).

7.2 <u>Plan Termination Generally</u>. The Bank and Director may terminate this Agreement at any time. However,
the Bank may unilaterally terminate this Agreement if pursuant to legislative, judicial or regulatory action, continuation of the Agreement
would (a) cause benefits to be taxable to the Director prior to actual receipt, or (b) result in significant financial penalties or other
significantly detrimental ramifications to the Bank (other than the financial impact of paying the benefits). Except as provided in Section
7.3, the termination of this Agreement shall not cause a distribution of benefits under this Agreement. Rather, upon such termination
benefit distributions will be made at the earliest distribution event permitted under Article 2 or Article 3.

7.3 <u>Plan Terminations Under Section 409A</u>. Notwithstanding anything to the contrary in Section 7.2,
if the Bank terminates this Agreement in the following circumstances:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Within thirty (30) days before, or twelve (12) months after a change in the ownership or effective control
of the Bank, or in the ownership of a substantial portion of the assets of the Bank as described in Section 409A(2)(A)(v) of the Code,
provided that all distributions are made no later than twelve (12) months following such termination of the Agreement and further provided
that all the Bank's arrangements which are substantially similar to the Agreement are terminated so the Director and all participants
in the similar arrangements are required to receive all amounts of compensation deferred under the terminated arrangements within
twelve (12) months of the termination of the arrangements;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Upon the Bank's dissolution or with the approval of a bankruptcy court provided that the amounts
deferred under the Agreement are included in the Director's gross income in the latest of (i) the calendar year in which the Agreement
terminates; (ii) the calendar year in which the amount is no longer subject to a substantial risk of forfeiture; or (iii) the first calendar
year in which the distribution is administratively practical; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Upon the Bank's termination of this and all other arrangements that would be aggregated with this
Agreement pursuant to Treasury Regulations Section 1.409A-1(c) if the Director participated in such arrangements ("Similar Arrangements"),
provided that (i) the termination and liquidation does not occur proximate to a downturn in the financial health of the Bank, (ii) all
termination distributions are made no earlier than twelve (12) months and no later than twenty-four (24) months following such termination,
and (iii) the Bank does not adopt any new arrangement that would be a Similar Arrangement for a minimum of three (3) years following the
date the Bank takes all necessary action to irrevocably terminate and liquidate the Agreement;

the Bank may distribute the vested Accrual Balance, determined as of the date of the termination of the Agreement, to the Director in a lump sum subject to the above terms.

**Article 8**

**Administration of Agreement**

8.1 <u>Plan Administrator Duties</u>. This Agreement shall be administered
by a Plan Administrator which shall consist of the Board, or such committee or person(s) as the Board shall appoint. The Plan Administrator
shall administer this Agreement according to its express terms and shall
also have the discretion and authority to (i) make, amend, interpret and enforce all appropriate rules and regulations for the administration
of this Agreement and (ii) decide or resolve any and all questions including interpretations of this Agreement, as may arise in connection
with the Agreement to the extent the exercise of such discretion and authority does not conflict with Section
409A of the Code and regulations thereunder.

8.2 <u>Agents</u>. In the administration of this Agreement, the Plan Administrator
may employ agents and delegate to them such administrative duties as it sees fit, (including acting through a duly appointed representative),
and may from time to time consult with counsel who may be counsel to the Bank.

8.3 <u>Binding Effect of Decisions</u>. The decision or action of the Plan
Administrator with respect to any question arising out of or in connection with the administration, interpretation and application of
the Agreement and the rules and regulations promulgated hereunder shall be final and conclusive and binding upon all persons having any
interest in the Agreement.

8.4 <u>Indemnity of Plan Administrator</u>. The Bank shall indemnify and
hold harmless the members of the Plan Administrator against any and all claims, losses, damages, expenses or liabilities arising from
any action or failure to act with respect to this Agreement, except in the case of willful misconduct by the Plan Administrator or any
of its members.

8.5 <u>Bank Information</u>. To enable the Plan Administrator to perform its functions, the Bank shall supply
full and timely information to the Plan Administrator on all matters relating to the date and circumstances of the retirement, Disability,
death, or Separation from Service of the Director, and such other pertinent information as the Plan Administrator may reasonably require.

8.6 <u>Annual Statement</u>. The Plan Administrator shall provide to the Director, within one hundred twenty
(120) days after the end of each Plan Year, a statement setting forth the benefits to be distributed under this Agreement.

**Article 9**

**Miscellaneous**

9.1 <u>Binding Effect</u>. This Agreement shall bind the Director and the Bank, and their beneficiaries, survivors,
executors, administrators and transferees.

9.2 <u>No Guarantee of Service</u>. This Agreement is not a contract for service. It does not give the Director
the right to remain as a director of the Bank, nor does it interfere with the Bank's right to discharge the Director. It also does not
require the Director to remain a director nor interfere with the Director's right to terminate service at any time.

9.3 <u>Non-Transferability</u>. Benefits under this Agreement cannot be sold, transferred, assigned, pledged,
attached or encumbered in any manner.

9.4 <u>Tax Withholding and Reporting</u>. The Bank shall withhold any taxes that are required to be withheld, including but not limited
to taxes owed under Section 409A of the Code and regulations thereunder, from the benefits provided under this Agreement. The Director
acknowledges that the Bank's sole liability regarding taxes is to forward any amounts withheld to the appropriate taxing authority(ies).
Further, the Bank shall satisfy all applicable reporting requirements, including those under Section 409A of the Code and regulations
thereunder.

9.5 <u>Applicable Law</u>. The Agreement and all rights hereunder shall be governed by the laws of the State
of Ohio, except to the extent preempted by the laws of the United States of America.

9.6 <u>Unfunded Arrangement</u>. The Director and the Beneficiary are general unsecured creditors of the Bank
for the distribution of benefits under this Agreement. The benefits represent the mere promise by the Bank to distribute such benefits.
The rights to benefits are not subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, attachment,
or garnishment by creditors. Any insurance on the Director's life or other informal funding asset is a general asset of the Bank to which
the Director and Beneficiary have no preferred or secured claim.

9.7 <u>Reorganization</u>. The Bank shall not merge or consolidate into or with another bank, or reorganize,
or sell substantially all of its assets to another bank, firm, or person unless such succeeding or continuing bank, firm, or person agrees
to assume and discharge the obligations of the Bank under this Agreement. Upon the occurrence of such event, the term "Bank"
as used in this Agreement shall be deemed to refer to the successor or survivor bank.

9.8 <u>Entire Agreement</u>. This Agreement constitutes the entire agreement between the Bank and the Director
as to the subject matter hereof. No rights are granted to the Director by virtue of this Agreement other than those specifically set forth
herein.

9.9 <u>Interpretation</u>. Wherever the fulfillment of the intent and purpose of this Agreement requires,
and the context will permit, the use of the masculine gender includes the feminine and use of the singular includes the plural.

9.10 <u>Alternative Action</u>. In the event it shall become impossible for the Bank or the Plan Administrator
to perform any act required by this Agreement, the Bank or Plan Administrator may in its discretion perform such alternative act as most
nearly carries out the intent and purpose of this Agreement and is in the best interests of the Bank, provided that such alternative acts
do not violate Section 409A of the Code.

9.11 <u>Headings</u>. Article and section headings are for convenient reference only and shall not control
or affect the meaning or construction of any of its provisions.

9.12 <u>Validity</u>. In case any provision of this Agreement shall be illegal or invalid for any reason, said
illegality or invalidity shall not affect the remaining parts hereof, but this Agreement shall be construed and enforced as if such illegal
and invalid provision has never been inserted herein.

9.13 <u>Notice</u>. Any notice or filing required or permitted to be given to the Bank or Plan Administrator under this Agreement shall
be sufficient if in writing and hand-delivered, or sent by registered or certified mail, to the address below:

<u>Mercer Savings Bank</u> <br> <u>1100 Irmscher Blvd.</u> <br> <u>Celina, OH 45822</u>

Such notice shall be deemed given as of the date of delivery or, if delivery is made by mail, as of the date shown on the postmark on the receipt for registration or certification.

Any notice or filing required or permitted to be given to the Director under this Agreement shall be sufficient if in writing and hand-delivered, or sent by mail, to the last known address of the Director.

9.14 <u>Compliance with Section 409A</u>. This Agreement shall at all times be administered and the provisions
of this Agreement shall be interpreted consistent with the requirements of Section 409A of the Code and any and all regulations thereunder,
including such regulations as may be promulgated after the Effective Date of this Agreement.

IN WITNESS WHEREOF, the Director and a duly authorized representative of the Bank have signed this Agreement.

---

| | | |
|:---|:---|:---|
| **DIRECTOR:** | **BANK:** | **BANK:** |
|  | **Mercer Savings Bank** | **Mercer Savings Bank** |
| /s/ David L. Keiser | **By** | /s/ William U. Martin |
| **David L. Keiser** |  |  |
|  | **Title** | President/CEO |

---

## Exhibit 10.4

**Exhibit 10.4**

Mercer Savings Bank

Director Retirement Agreement

**MERCER SAVINGS BANK**

**DIRECTOR RETIREMENT AGREEMENT**

THIS DIRECTOR RETIREMENT AGREEMENT (the "Agreement") is adopted this 10<sup>th</sup> day of October, 2006, by and between Mercer Savings Bank, a savings association located in Celina, Ohio (the "Bank") and Richard A. Mosier (the "Director").

The purpose of this Agreement is to provide specified benefits to the Executive, a member of a select group of management or highly compensated employees who contribute materially to the continued growth, development and future business success of the Bank. This Agreement shall be unfunded for tax purposes and for purposes of Title I of the Employee Retirement Income Security Act ("ERISA").

**Article 1**

**Definitions**

Whenever used m this Agreement, the following words and phrases shall have the meanings specified:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1 " <u>Accrual Balance</u> " means the liability that should be accrued by the Bank, under Generally
 Accepted Accounting Principles ("GAAP"), for the Bank's obligation to the
 Executive under this Agreement, by applying Accounting Principles Board Opinion Number 12
 ("APB 12") as amended by Statement of Financial Accounting Standards Number 106
 ("FAS 106") and the Discount Rate. Any one of a variety of amortization methods
 may be used to determine the Accrual Balance. However, once chosen, the method must be consistently
 applied. The Accrual Balance shall be reported annually by the Bank to the Executive.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2 " <u>Beneficiary</u> "
 means each designated person, or the estate of the deceased Director, entitled to benefits,
 if any, upon the death of the Director determined pursuant to Article 4.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3 " <u>Beneficiary Designation Form</u> " means the form established from time to time by the Plan Administrator
 that the Director completes, signs, and returns to the Plan Administrator to designate one
 or more Beneficiaries.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.4 " <u>Board</u> " means the
 Board of Directors of the Bank as from time to time constituted.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.5 " <u>Change of Control</u> "
 means the transfer of shares of the Bank's voting common stock such that one entity
 or one person acquires (or is deemed to acquire when applying Section 318 of the Code) more
 than fifty percent (50%) of the Bank's outstanding voting common stock followed within
 twelve (12) months by the Director's Separation fiom Service for reasons other than
 death, Disability or retirement. Since the Bank is chartered under the mutual form of ownership,
 refer to Section 9.7 for guidance in the event of a merger or consolidation into or with
 another company, reorganization, or the sale of substantially all of its assets to another
 form or person.

Mercer Savings Bank

Director Retirement Agreement

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.6 " <u>Code</u> "
 means the Internal Revenue Code of 1986, as amended.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.7 " <u>Disability</u> "
 means the Director's suffering a sickness, accident or injury which has been determined
 by the carrier of any individual or group disability insurance policy covering the Director,
 or by the Social Security Administration, to be a disability rendering the Director totally
 and permanently disabled. The Director must submit proof to the company of the carrier's
 or Social Security Administration's determination upon the request of the Bank.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.8 " <u>Early Termination</u> "
 means Separation from Service prior to Normal Retirement Age for reasons other than death,
 Disability, Termination for Cause or following a Change of Control.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.9 " <u>Effective Date</u> " means **June 1, 2006.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.10 " <u>Fees</u> " means the
 total fees payable to the Director during a Plan Year.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.11 " <u>Normal Retirement Age</u> "
 means the Director attaining age seventy (70).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.12 " <u>Normal Retirement Date</u> " means the later of Normal Retirement Age or Separation from Service
 or end of current term.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.13 " <u>Plan Administrator</u> "
 means the plan administrator described in Article 8.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.14 " <u>Plan Year</u> " means each twelve (12) month period commencing on January 1 and ending on
 December 31 of each year. The initial Plan Year shall commence on the Effective Date of this
 Agreement and end on the following December 31.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.15 " <u>Schedule A</u> " means the schedule attached to this Agreement and made a part hereof. Schedule
 A shall be updated upon a change in any of the benefits under Articles 2 or 3.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.16 " <u>Separation from Service</u> " means the termination of the Director's service with the **Bank** for reasons other than death. Whether a Separation from
 Service takes place is determined based on the facts and circumstances surrounding the termination
 of the Director's service and whether the Bank and the Director intended for the Director
 to provide significant services for the Bank following such termination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.17 " <u>Specified Employee</u> "
 means a key employee (as defined in Section 416(i) of the Code without regard to paragraph
 5 thereof) of the Bank if any stock of the Bank is publicly traded on an established securities
 market or otherwise.

Mercer Savings Bank

Director Retirement Agreement

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.18 " <u>Termination for Cause</u> "
 means the definition as stated in Section 5.2.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.19 " <u>Years of Service</u> " means a period of twelve (12) consecutive months during which the Director
 has been a member of the Board. The Director's first Year of Service shall begin with
 the month of the Director's election to the Board and end twelve (12) months later.
 Additional Years of Service, if any, will be counted for each consecutive twelve (12) month
 period thereafter that begins on the same month as the Director's first Year of Service. If there are any approved leaves of absences, the Director
 shall be considered continuously a member of the Board for purposes of this Agreement. The
 Director's election to the Board was January, 2006.

**Article 2**

**Lifetime Benefits**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1 <u>Normal Retirement Annual Benefit</u>. Upon Separation from Service on or after the Normal Retirement Age for
 reasons other than death, the Bank shall distribute to the Director the benefit described
 in this Section 2.1 in lieu of any other benefit under this Article.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1.1 <u>Amount of Benefit</u>. The benefit under this Section 2.1 is the amount set forth on Schedule A for
 the Plan Year ending immediately prior to the Normal Retirement Date, determined be vesting
 the Director in thirty-three percent (33%) of the Normal Retirement Annual Benefit after
 six years of service to the Board through Year 10, sixty-six percent (66%) of the Normal
 Retirement Annual Benefit after year 10 and through Year 18 and one hundred percent (100%)
 of the Normal Retirement Annual Benefit after Year 18. Service on the Board prior to the
 Effective Date of this Agreement shall be credited for the purposes of defining the benefit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1.2 <u>Distribution of Benefit</u>. The Bank shall distribute the benefit to the Director in twelve (12) equal
 monthly installments commencing on the first day of the month following Normal Retirement
 Date. The annual benefit shall be distributed to the Director for ten (10) years.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2 <u>Early Termination Benefit</u>. Upon Early Termination, the Bank shall distribute to the Director the benefit
 described in this Section 2.2 in lieu of any other benefit under this Article.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2.1 <u>Amount of Benefit</u>. The annual
 benefit under this Section 2.2 is the amount set forth on Schedule A for the Plan Year ending
 immediately prior to the Separation from Service, determined be vesting the Director in thirty-three
 percent (33%) of the Accrual Balance after six years of service to the Board through Year
 10, sixty-six percent (66%) of the Accrual Balance after year 10 and through Year 18 and
 one hundred percent (100%) of the Accrual Balance after Year 18. Service on the Board prior
 to the Effective Date of this Agreement shall be credited for the purposes of defining the
 benefit.

Mercer Savings Bank

Director Retirement Agreement

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2.2 <u>Distribution of Benefit</u>. The Bank shall distribute the benefit to the Director in a lump sum within
 sixty (60) days after Separation from Service.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3 <u>Disability Benefit</u>. If the Director experiences a Disability
 which results in a Separation from Service prior to Normal Retirement Age, the Bank shall
 distribute to the Director the benefit described in this Section 2.3 in lieu of any other
 benefit under this Article.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3.1 <u>Amount of Benefit</u>. The annual benefit under this Section 2.3 is the Director Fees for the Plan
 Year ending immediately prior to the date in which the Separation from Service occurs. The
 Director will be one hundred (100%) vested in the benefit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3.2 <u>Distribution of Benefit</u>. The Bank shall distribute the benefit to the Director in twelve (12) equal
 monthly installments commencing on the first day of the month following Separation from Service.
 The annual benefit shall be distributed to the Director for ten (10) years.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4 <u>Change of Control Benefit</u>. Upon a Change of Control followed within by a Separation from Service, the Bank
 shall distribute to the Director the benefit described in this Section 2.4 in lieu of any
 other benefit under this Article.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4.1 <u>Amount of Benefit</u>. The annual
 benefit under this Section 2.4 is the amount set forth on Schedule A for the Plan Year ending
 immediately prior to the date in which the Separation from Service occurs (except during
 the first Plan Year, the benefit is the amount set forth for Plan Year 1), except by vesting
 the Director one hundred percent (100%) in the Normal Retirement Benefit described in Section
 2.1.1.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4.2 <u>Distribution of Benefit</u>.
 The Bank shall distribute the benefit to the Director in a lump sum within sixty (60) days
 after Separation from Service.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.5 <u>Restriction on Timing of Distribution</u>.
 Notwithstanding any provision of this Agreement to the contrary, if the Director is considered
 a Specified Employee at Separation from Service under such procedures as established by the
 Bank in accordance with Section 409A of the Code, benefit distributions that are made upon
 Separation from Service may not commence earlier than six (6) months after the date of such
 Separation from Service. Therefore, in the event this Section 2.5 is applicable to the Director,
 any distribution which would otherwise be paid to the Director within the first six months
 following the Separation from Service shall be accumulated and paid to the Director in a
 lump sum on the first day of the seventh month following the Separation from Service. All
 subsequent distributions shall be paid in the manner specified.

Mercer Savings Bank

Director Retirement Agreement

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.6 <u>Distributions Upon Income Inclusion Under Section 409A of the Code</u>. Upon the inclusion of any portion of the Accrual Balance
 into the Director's income as a result of the failure of this non-qualified deferred
 compensation plan to comply with the requirements of Section 409A of the Code, to the extent
 such tax liability can be covered by the Accrual Balance, a distribution shall be made as
 soon as is administratively practicable following the discovery of the plan failure.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.7 <u>Change in Form or Timing of Distributions</u>. For distribution of benefits under this Article 2, the Director
 and the Bank may, subject to the terms of Section 8.1, amend the Agreement to delay the timing
 or change the form of distributions. Any such amendment:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) may not accelerate the time or schedule of any distribution, except as provided in
Section 409A of the Code and the regulations thereunder;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) must, for benefits distributable under Sections 2.1, 2.2, 2.3 and 2.4, delay the commencement
of distributions for a minimum of five (5) years from the date the first distribution was originally scheduled to be made; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) must take effect not less than twelve (12) months after the amendment is made.

**Article 3**

**Distribution at Death**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1 <u>Death During Active Service</u>. If the Director dies while
 in the active service of the Bank, the Bank shall distribute to the Beneficiary the benefit
 described in this Section 3.1. This benefit shall be distributed in lieu of the Lifetime
 Benefits of Article 2.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1.1 <u>Amount of Benefit</u>.
 The annual benefit under this Section 3.1 is the Normal Retirement Benefit. The Director
 is one hundred (100%) vested in the benefit.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1.2 <u>Distribution of Benefit</u>. The Bank shall distribute the benefit to the Beneficiary in twelve (12) equal
 monthly installments for ten (10) years commencing the first day of the month following receipt
 by the Bank of the Director's death certificate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2 <u>Death During Distribution of a Benefit</u>. If the Director
 dies after any benefit distributions have commenced under this Agreement but before receiving
 all such distributions, the Bank shall distribute to the Beneficiary the remaining benefits
 at the same time and in the same amounts that would have been distributed to the Director
 had the Director survived.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3 <u>Death After Separation from Service But Before Benefit Distributions Commence</u>. If the Director is entitled to benefit distributions
 under this Agreement, but dies prior to the commencement of said benefit distributions, the
 Bank shall distribute to the Beneficiary the same benefits that the Director was entitled
 to prior to death except that the benefit payments shall commence on the first day of the
 month following the date of the Director's death.

Mercer Savings Bank

Director Retirement Agreement

**Article 4**

**Beneficiaries**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1 <u>Beneficiary</u>. The Director shall
 have the right, at any time, to designate a Beneficiary to receive any benefit distributions
 under this Agreement upon the death of the Director. The Beneficiary designated under this
 Agreement may be the same as or different from the beneficiary designated under any other
 plan of the Bank in which the Director participates.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2 <u>Beneficiary Designation: Change</u>.
 The Director shall designate a Beneficiary by completing and signing the Beneficiary Designation
 Form, and delivering it to the Plan Administrator or its designated agent. The Director's
 beneficiary designation shall be deemed automatically revoked if the Beneficiary predeceases
 the Director or if the Director names a spouse as Beneficiary and the marriage is subsequently
 dissolved. The Director shall have the right to change a Beneficiary by completing, signing
 and otherwise complying with the terms of the Beneficiary Designation Form and the Plan Administrator's
 rules and procedures, as in effect from time to time. Upon the acceptance by the Plan Administrator
 of a new Beneficiary Designation Form, all Beneficiary designations previously filed shall
 be cancelled. The Plan Administrator shall be entitled to rely on the last Beneficiary Designation
 Form filed by the Director and accepted by the Plan Administrator prior to the Director's
 death.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3 <u>Acknowledgment</u>. No designation
 or change in designation of a Beneficiary shall be effective until received, accepted and
 acknowledged in writing by the Plan Administrator or its designated agent.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4 <u>No Beneficiary Designation</u>. If the Director dies without a valid beneficiary designation,
 or if all designated Beneficiaries predecease the Director, then the Director's spouse
 shall be the designated Beneficiary. If the
 Director has no surviving spouse, the benefits shall be made to the personal representative
 of the Director's estate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.5 <u>Facility of Distribution</u>. If the Plan Administrator determines
 in its discretion that a benefit is to be distributed to a minor, to a person declared incompetent,
 or to a person incapable of handling the disposition of that person's property, the
 Plan Administrator may direct distribution of such benefit to the guardian, legal representative
 or person having the care or custody of such minor, incompetent person or incapable person.
 The Plan Administrator may require proof of incompetence, minority or guardianship as it
 may deem appropriate prior to distribution of the benefit. Any distribution of a benefit
 shall be a distribution for the account of the Director and the Director's Beneficiary,
 as the case may be, and shall be a complete discharge of any liability under the Agreement
 for such distribution amount.

Mercer Savings Bank

Director Retirement Agreement

**Article 5**

**General Limitations**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1 <u>Parachute Payments</u>.
 Notwithstanding any provision of this Agreement to the contrary, the Bank shall not pay any
 benefit under this Agreement to the extent the benefit would create an excise tax under the
 excess parachute rules of Section 280G of the Code.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2 <u>Termination for Cause</u>. Notwithstanding any provision of this Agreement to the contrary, the Bank
 shall not distribute any benefit under this Agreement if the Bank terminates the Director's
 service for:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Gross negligence or gross neglect of duties to the Bank; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Commission of a felony or of a gross misdemeanor involving moral turpitude in connection
with the Director's service with the Bank; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Fraud, disloyalty, dishonesty or willful violation of any law or significant Bank
policy committed in connection with the Director's service and resulting in a material adverse effect on the Bank.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3 <u>Suicide or Misstatement</u>. No
 benefits shall be distributed if the Director commits suicide within two years after the
 Effective Date of this Agreement, or if an insurance company which issued a life insurance
 policy covering the Director and owned by the Bank denies coverage (i) for material misstatements
 of fact made by the Director on an application for such life insurance, or (ii) for any other
 reason.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.4 <u>Removal</u>. Notwithstanding any
 provision of this Agreement to the contrary, the Bank shall not distribute any benefit under
 this Agreement if the Director is subject to a final removal or prohibition order issued
 by an appropriate federal banking agency pursuant to Section 8(e) of the Federal Deposit
 Insurance Act.

**Article 6**

**Claims And Review Procedures**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1 <u>Claims Procedure</u>. A Director
 or Beneficiary ("claimant") who has not received benefits under the Agreement
 that he or she believes should be distributed shall make a claim for such benefits as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1.1 <u>Initiation - Written Claim</u>.
 The claimant initiates a claim by submitting to the Plan Administrator a written claim for
 the benefits. If such a claim relates to the contents of a notice received by the claimant,
 the claim must be made within sixty (60) days after such notice was received by the claimant.
 All other claims must be made within one hundred eighty (180) days of the date on which the
 event that caused the claim to arise occurred. The claim must state with particularity the
 determination desired by the claimant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1.2 <u>Timing of Plan Administrator Response</u>.
 The Plan Administrator shall respond to such claimant within ninety (90) days after receiving
 the claim. If the Plan Administrator determines that special circumstances require additional
 time for processing the claim, the Plan Administrator can extend the response period by an
 additional ninety (90) days by notifying the claimant in writing, prior to the end of the
 initial ninety (90) day period, that an additional period is required. The notice of extension
 must set forth the special circumstances and the date by which the Plan Administrator expects
 to render its decision.

Mercer Savings Bank

Director Retirement Agreement

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1.3 <u>Notice of Decision</u>. If the Plan Administrator denies part or all of the claim, the Plan Administrator
 shall notify the claimant in writing of such denial. The Plan Administrator shall write the
 notification in a manner calculated to be understood by the claimant. The notification shall
 set forth:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The specific reasons for the denial;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) A reference to the specific provisions of the Agreement on which the denial is based;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) A description of any additional information or material necessary for the claimant
to perfect the claim and an explanation of why it is needed; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) An explanation of the Agreement's review procedures and the time limits applicable
to such procedures.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2 <u>Review Procedure</u>.
 If the Plan Administrator denies part or all of the claim, the claimant shall have the opportunity
 for a full and fair review by the Plan Administrator of the denial, as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2.1 <u>Initiation - Written Request</u>. To initiate the review, the claimant, within 60 days after receiving
 the Plan Administrator's notice of denial, must file with the Plan Administrator a
 written request for review.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2.2 <u>Additional Submissions - Information Access</u>. The claimant shall then have the opportunity to submit
 written comments, documents, records and other information relating to the claim. The Plan
 Administrator shall also provide the claimant, upon request and free of charge, reasonable
 access to, and copies of, all documents, records and other information relevant to the claimant's
 claim for benefits.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2.3 <u>Considerations on Review</u>. In
 considering the review, the Plan Administrator shall take into account all materials and
 information the claimant submits relating to the claim, without regard to whether such information
 was submitted or considered in the initial benefit determination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2.4 <u>Timing of Plan Administrator Response</u>. The Plan Administrator shall respond in writing to such
 claimant within sixty (60) days after receiving the request for review. If the Plan Administrator
 determines that special circumstances require additional time for processing the claim, the
 Plan Administrator can extend the response period by an additional sixty (60) days by notifying
 the claimant in writing, prior to the end of the initial sixty (60) day period, that an additional
 period is required. The notice of extension must set forth the special circumstances and
 the date by which the Plan Administrator expects to render its decision.

Mercer Savings Bank

Director Retirement Agreement

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2.5 <u>Notice of Decision</u>. The Plan
 Administrator shall notify the claimant in writing of its decision on review. The Plan Administrator
 shall write the notification in a manner calculated to be understood by the claimant. The
 notification shall set forth:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The specific reasons for the denial;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) A reference to the specific provisions of the Agreement on which the denial is based;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) A statement that the claimant is entitled to receive, upon request and free of charge,
reasonable access to, and copies of, all documents, records and other information relevant to the claimant's claim for benefits; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) A statement of the claimant's right to bring a civil action.

**Article 7**

**Amendments and Termination**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1 <u>Amendments</u>.
 This Agreement may be amended only by a written agreement signed by the Bank and the Director.
 However, the Bank may unilaterally amend this Agreement (i) to conform with written directives
 to the Bank from its auditors or banking regulators or to comply with legislative changes
 or tax law, including without limitation Section 409A of the Code and any and all Treasury
 regulations and guidance promulgated thereunder or (ii) if pursuant to legislative, judicial
 or regulatory action, continuation of the Agreement would (a) cause benefits to be taxable
 to the Director prior to actual receipt, or (b) result in significant financial penalties
 or other significantly detrimental ramifications to the Bank (other than the financial impact
 of paying the benefits).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2 <u>Plan Termination Generally</u>. The Bank and Director may terminate this Agreement at any time. However, the
 Bank may unilaterally terminate this Agreement if pursuant to legislative, judicial or regulatory
 action, continuation of the Agreement would (a) cause benefits to be taxable to the Director
 prior to actual receipt, or (b) result in significant financial penalties or other significantly
 detrimental ramifications to the Bank (other than the financial impact of paying the benefits).
 Except as provided in Section 7.3, the termination of this Agreement shall not cause a distribution
 of benefits under this Agreement. Rather, upon such termination benefit distributions will
 be made at the earliest distribution event permitted under Article 2 or Article 3.

Mercer Savings Bank

Director Retirement Agreement

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.3 <u>Plan Terminations Under Section 409A</u>. Notwithstanding anything to the contrary in Section 7.2, if the Bank
 terminates this Agreement in the following circumstances:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Within thirty (30) days before, or twelve (12) months after
a change in the ownership or effective control of the Bank, or in the ownership of a substantial portion of the assets of the Bank as
described in Section 409A(2)(A)(v) of the Code, provided that all distributions are made no later than twelve (12) months following such
termination of the Agreement and further provided that all the Bank's arrangements which are substantially similar to the Agreement
are terminated so the Director and all participants in the similar arrangements are required to receive all amounts of compensation deferred
under the terminated arrangements within twelve (12) months of the termination of the arrangements;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Upon the Bank's dissolution or with the approval of a bankruptcy court provided that
the amounts deferred under the Agreement are included in the Director's gross income in the latest of (i) the calendar year in which the
Agreement terminates; (ii) the calendar year in which the amount is no longer subject to a substantial risk of forfeiture; or (iii) the
first calendar year in which the distribution is administratively practical; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Upon the Bank's termination of this and all other non-account balance plans (as referenced
in Section 409A of the Code or the regulations thereunder), provided that all distributions are made no earlier than twelve (12) months
and no later than twenty-four (24) months following such termination, and the Bank does not adopt any new non-account balance plans for
a minimum of five (5) years following the date of such termination;

the Bank may distribute the Accrual Balance, determined as of the date of the termination of the Agreement, to the Director in a lump sum subject to the above terms.

**Article 8**

**Administration of Agreement**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1 <u>Plan Administrator Duties</u>. This Agreement shall be administered by a Plan Administrator which shall consist
 of the Board, or such committee or person(s) as the Board shall appoint. The Plan Administrator
 shall administer this Agreement according to its express terms and shall also have the discretion
 and authority to (i) make, amend, interpret and enforce all appropriate rules and regulations
 for the administration of this Agreement and (ii) decide or resolve any and all questions
 including interpretations of this Agreement, as may arise in connection with the Agreement
 to the extent the exercise of such discretion and authority does not conflict with Section
 409A of the Code and regulations thereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2 <u>Agents</u>. In the administration of this Agreement, the Plan Administrator
 may employ agents and delegate to them such administrative duties as it sees fit, (including
 acting through a duly appointed representative), and may from time to time consult with counsel
 who may be counsel to the Bank.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3 <u>Binding Effect of Decisions</u>. The decision or action of the Plan Administrator with respect to any question
 arising out of or in connection with the administration, interpretation and application of
 the Agreement and the rules and regulations promulgated hereunder shall be final and conclusive
 and binding upon all persons having any interest in the Agreement.

Mercer Savings Bank

Director Retirement Agreement

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.4 <u>Indemnity of Plan Administrator</u>. The Bank shall indemnify and hold harmless the members of the Plan
 Administrator against any and all claims, losses, damages, expenses or liabilities arising
 from any action or failure to act with respect to this Agreement, except in the case of willful
 misconduct by the Plan Administrator or any of its members.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.5 <u>Bank Information</u>.
 To enable the Plan Administrator to perform its functions, the Bank shall supply full and
 timely information to the Plan Administrator on all matters relating to the date and circumstances
 of the retirement, Disability, death, or Separation from Service of the Director, and such
 other pertinent information as the Plan Administrator may reasonably require.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.6 <u>Annual Statement</u>.
 The Plan Administrator shall provide to the Director, within one hundred twenty (120) days
 after the end of each Plan Year, a statement setting forth the benefits to be distributed
 under this Agreement.

**Article 9**

**Miscellaneous**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1 <u>Binding Effect</u>.
 This Agreement shall bind the Director and the Bank, and their beneficiaries, survivors,
 executors, administrators and transferees.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.2 <u>No Guarantee of Service</u>. This Agreement is not a contract for service. It does
 not give the Director the right to remain as a director of the Bank, nor does it interfere
 with the Bank's right to discharge the Director. It also
 does not require the Director to remain a director nor interfere with the Director's
 right to terminate service at any time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.3 <u>Non-Transferability</u>.
 Benefits under this Agreement cannot be sold, transferred, assigned, pledged, attached or
 encumbered in any manner.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.4 <u>Tax Withholding and Reporting</u>. The Bank shall withhold any taxes that are required to be withheld, including
 but not limited to taxes owed under Section 409A of the Code and regulations thereunder,
 from the benefits provided under this Agreement. The Director acknowledges that the Bank's
 sole liability regarding taxes is to forward any amounts withheld to the appropriate taxing
 authority(ies). Further, the Bank shall satisfy all applicable reporting requirements, including
 those under Section 409A of the Code and regulations thereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.5 <u>Applicable Law</u>. The Agreement
 and all rights hereunder shall be governed by the laws of the State of Ohio, except to the
 extent preempted by the laws of the United States of America.

Mercer Savings Bank

Director Retirement Agreement

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.6 <u>Unfunded Arrangement</u>.
 The Director and the Beneficiary are general unsecured creditors of the Bank for the distribution
 of benefits under this Agreement. The benefits represent the mere promise by the Bank to
 distribute such benefits. The rights to benefits are not subject in any manner to anticipation,
 alienation, sale, transfer, assignment, pledge, encumbrance, attachment, or garnishment by
 creditors. Any insurance on the Director's life or other informal funding asset is
 a general asset of the Bank to which the Director and Beneficiary have no preferred or secured
 claim.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.7 <u>Reorganization</u>.
 The Bank shall not merge or consolidate into or with another bank, or reorganize, or sell
 substantially all of its assets to another bank, firm, or person unless such succeeding or
 continuing bank, firm, or person agrees to assume and discharge the obligations of the Bank
 under this Agreement. Upon the occurrence of such event, the term "Bank" as used
 in this Agreement shall be deemed to refer to the successor or survivor bank.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.8 <u>Entire Agreement</u>. This Agreement
 constitutes the entire agreement between the Bank and the Director as to the subject matter
 hereof. No rights are granted to the Director by virtue of this Agreement other than those
 specifically set forth herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.9 <u>Interpretation</u>.
 Wherever the fulfillment of the intent and purpose of this Agreement masculine gender includes
 the requires, and the context will permit, the use of the feminine and use of the singular
 includes the plural.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.10 <u>Alternative Action</u>. In the
 event it shall become impossible for the Bank or the Plan Administrator to perform any act
 required by this Agreement, the Bank or Plan Administrator may in its discretion perform
 such alternative act as most nearly carries out the intent and purpose of this Agreement
 and is in the best interests of the Bank, provided that such alternative acts do not violate
 Section 409A of the Code.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.11 <u>Headings</u>.
 Article and section headings are for convenient reference only and shall not control or affect
 the meaning or construction of any of its provisions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.12 <u>Validity</u>. In case any provision
 of this Agreement shall be illegal or invalid for any reason, said illegality or invalidity
 shall not affect the remaining parts hereof, but this Agreement shall be construed and enforced
 as if such illegal and invalid provision has never been inserted herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.13 <u>Notice</u>. Any
 notice or filing required or permitted to be given to the Bank or Plan Administrator under
 this Agreement shall be sufficient if in writing and hand-delivered, or sent by registered
 or certified mail, to the address below:

<u>Mercer Savings Bank</u> <br> <u>217 West Market Street</u> <br> <u>Celina, OH 45822</u>

Mercer Savings Bank

Director Retirement Agreement

Such notice shall be deemed given as of the date of delivery or, if delivery is made by mail, as of the date shown on the postmark on the receipt for registration or certification.

Any notice or filing required or permitted to be given to the Director under this Agreement shall be sufficient if in writing and hand-delivered, or sent by mail, to the last known address of the Director.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.14 <u>Compliance with Section 409A</u>.
 This Agreement shall at all times be administered and the provisions of this Agreement shall
 be interpreted consistent with the requirements of Section 409A of the Code and any and all
 regulations thereunder, including such regulations as may be promulgated after the Effective
 Date of this Agreement.

IN WITNESS WHEREOF, the Director and a duly authorized representative of the Bank have signed this Agreement.

---

| | | |
|:---|:---|:---|
| **Director:** | **BANK:** | **BANK:** |
|  | **Mercer Savings Bank** | **Mercer Savings Bank** |
| /s/ Richard A. Mosier | **By** | /s/ J. Douglas Temple |
| **Richard A. Mosier** |  |  |
|  | **Title** | Pres/CEO |

---

 

---

| | | |
|:---|:---|:---|
| Clark Consulting | *4-06 DRP - S2 Cover Liability at Death* | **Plan Year Reporting** |
|  | **Hypothetical Termination Benefits Schedule** | |

---

**Richard A. Mosier**

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | | | | **Early Voluntary Termination** | **Early Voluntary Termination** | **Disability** | **Disability** | **Change in Control** | **Change in Control** | **Pre-retire.<br> Death<br> Benefit** |
| Birth Date: 12/1/1953<br> Plan Anniversary Date: 1/1/2007<br> Normal Retirement: 1/1/2024, Age 70<br> Normal Retirement Payment: Monthly for 10 years | Birth Date: 12/1/1953<br> Plan Anniversary Date: 1/1/2007<br> Normal Retirement: 1/1/2024, Age 70<br> Normal Retirement Payment: Monthly for 10 years | Birth Date: 12/1/1953<br> Plan Anniversary Date: 1/1/2007<br> Normal Retirement: 1/1/2024, Age 70<br> Normal Retirement Payment: Monthly for 10 years | Birth Date: 12/1/1953<br> Plan Anniversary Date: 1/1/2007<br> Normal Retirement: 1/1/2024, Age 70<br> Normal Retirement Payment: Monthly for 10 years | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Annual Benefit <sup>3</sup> Amount Payable at<br> Separation from Service | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Annual Benefit <sup>3</sup> Amount Payable at<br> Separation from Service | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Annual Benefit <sup>3</sup> Amount Payable at<br> Separation from Service | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Annual Benefit <sup>3</sup> Amount Payable at<br> Separation from Service | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Annual Benefit <sup>3</sup> Amount Payable at<br> Separation from Service | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Annual Benefit <sup>3</sup> Amount Payable at<br> Separation from Service | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Annual <sup>3</sup> Benefit |
| **Values** | **Discount <br> Rate** | **Benefit<br> Level <sup>2</sup>** | **Account <br> Value** | Vesting | Based On<br> Account Value | Vesting | Based On<br> Benefit | Vesting | Based On<br> Benefit | Based On <br> Benefit |
| **as of** | (1) | (2) | (3) | (4) | (5) | (6) | (7) | (8) | (9) | (10) |
| Jun 2006 <sup>1</sup> |  | 10440 |  | 0% | 0 | 100% | 10440 | 100% | 18736 | 18736 |
| Dec 2006 | 6.00% | 10440 | 2673 | 0% | 0 | 100% | 10440 | 100% | 18736 | 18736 |
| Dec 2007 | 6.00% | 10805 | 7478 | 0% | 0 | 100% | 10805 | 100% | 18736 | 18736 |
| Dec 2008 | 6.00% | 11184 | 12579 | 0% | 0 | 100% | 11184 | 100% | 18736 | 18736 |
| Dec 2009 | 6.00% | 11575 | 17995 | 0% | 0 | 100% | 11575 | 100% | 18736 | 18736 |
| Dec 2010 | 6.00% | 11980 | 23745 | 0% | 0 | 100% | 11980 | 100% | 18736 | 18736 |
| Dec 2011 | 6.00% | 12399 | 29850 | 33% | 1338 | 100% | 12399 | 100% | 18736 | 18736 |
| Dec 2012 | 6.00% | 12833 | 36331 | 33% | 1629 | 100% | 12833 | 100% | 18736 | 18736 |
| Dec 2013 | 6.00% | 13283 | 43212 | 33% | 1937 | 100% | 13283 | 100% | 18736 | 18736 |
| Dec 2014 | 6.00% | 13747 | 50517 | 33% | 2265 | 100% | 13747 | 100% | 18736 | 18736 |
| Dec 2015 | 6.00% | 14229 | 58273 | 33% | 2613 | 100% | 14229 | 100% | 18736 | 18736 |
| Dec 2016 | 6.00% | 14727 | 66507 | 66% | 5964 | 100% | 14727 | 100% | 18736 | 18736 |
| Dec 2017 | 6.00% | 15242 | 75249 | 66% | 6748 | 100% | 15242 | 100% | 18736 | 18736 |
| Dec 2018 | 6.00% | 15776 | 84531 | 66% | 7580 | 100% | 15776 | 100% | 18736 | 18736 |
| Dec 2019 | 6.00% | 16328 | 94384 | 66% | 8464 | 100% | 16328 | 100% | 18736 | 18736 |
| Dec 2020 | 6.00% | 16899 | 104846 | 66% | 9402 | 100% | 16899 | 100% | 18736 | 18736 |
| Dec 2021 | 6.00% | 17491 | 115953 | 66% | 10398 | 100% | 17491 | 100% | 18736 | 18736 |
| Dec 2022 | 6.00% | 18103 | 127744 | 66% | 11455 | 100% | 18103 | 100% | 18736 | 18736 |
| Dec 2023 | 6.00% | 18736 | 140263 | 66% | 12578 | 100% | 18736 | 100% | 18736 | 18736 |
| Jan 2024 | 6.00% | 18736 | 141341 | 100% | 19204 | 100% | 18736 | 100% | 18736 | 18736 |

---

<sup>1</sup> The first line reflects just the initial values as of June 1, 2006.

<sup>2</sup> The benefit amount is based on a $10,440 beginning benefit, inflating at 3.50% each year to $18,736 at retirement.

<sup>3</sup> The annual benefit amount will be paid for 10 years.

<sup>\*</sup> The purpose of this hypothetical illustration is to show the participant's annual benefit based on various termination assumptions. Actual benefits are based on the terms and provisions of the plan agreement. Consequently, actual benefits may differ from those shown on this Hypothetical Termination Benefits Schedule.

Director Retirement Plan for Mercer Savings Bank - Celina, OH Securities offered through Clark Securities, Inc. <br> 831158 38395 298001 v5.43 09/05/2006:16 SCP-D,Ret NB Member NASD & SIPC, Los Angeles, CA 90071, (213) 438-6300

## Exhibit 10.5

**Exhibit 10.5**

MERCER SAVINGS BANK

Director Retirement Agreement

**FIRST AMENDMENT**

**TO THE**

**MERCER SAVINGS BANK**

**DIRECTOR RETIREMENT AGREEMENT**

**DATED OCTOBER 10, 2006**

**FOR**

**RICHARD A. MOSIER**

THIS FIRST AMENDMENT is adopted this 23<sup>rd</sup> day of October, 2007, effective as of January 1, 2005, by and between Mercer Savings Bank located in Celina, Ohio (the "Bank"), and Richard A. Mosier (the "Director").

The Bank and the Director executed the Director Retirement Agreement on October 10, 2006, effective June 1, 2006 (the "Agreement").

The undersigned hereby amend the Agreement to reflect the final 409A Treasury Regulations. Therefore, the following changes shall be made:

*Section 1. 7 of the Agreement shall be deleted in its entirety and replaced by the following:*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.7 *"Disability"* means the Director: (i) is unable to engage in any substantial
 gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or
 can be expected to last for a continuous period of not less than twelve (12) months; or (ii) is, by reason of any medically
 determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous
 period of not less than twelve (12) months, receiving income replacement benefits for a period of not less than three (3) months
 under an accident and health plan covering employees or directors of the Company. Medical determination of Disability may be made by
 either the Social Security Administration or by the provider of an accident or health plan covering employees or directors of the
 Bank provided that the definition of "disability" applied under such disability insurance program complies with the
 requirements of the preceding sentence. Upon the request of the Plan Administrator, the Executive must submit proof to the Plan
 Administrator of the Social Security Administration' s or the provider's determination.

*Sections 2.3, 2.3.1 and 2.3.2 of the Agreement shall be deleted in their entirety and replaced by the following:*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3 *Disability Benefit.* If the
Director experiences a Disability prior to Normal Retirement Age, the Bank shall distribute to the Director the benefit described in this
Section 2 .3 in lieu of any other benefit under this Article.

MERCER SAVINGS BANK

Director Retirement Agreement

---

| | |
|:---|:---|
| 2.3.l | *Amount of Benefit.* The annual benefit under this Section 2.3 is the Director Fees for the Plan Year ending immediately prior to the date in which the Disability occurs. The Director will be one hundred percent (100%) vested in the benefit. |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3.2 *Distribution of Benefit.* The Bank shall distribute
the benefit to the Director in twelve (12) equal monthly installments commencing on the first day of the month following the Disability.
The annual benefit shall be distributed to the Director for ten (10) years.

*Section 7.3 of the Agreement shall be deleted in its entirety and replaced by the following:*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.3 *Plan Terminations Under Section 409A.* Notwithstanding anything to the contrary in Section 7.2,
if the Bank terminates this Agreement in the following circumstances:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Within thirty (30) days before, or twelve (12) months after a change in the ownership or effective control
of the Bank, or in the ownership of a substantial portion of the assets of the Bank as described in Section 409A(2)(A)(v) of the Code,
provided that all distributions are made no later than twelve (12) months following such termination of the Agreement and further provided
that all the Bank's arrangements which are substantially similar to the Agreement are terminated so the Director and all participants
in the similar arrangements are required to receive all amounts of compensation deferred under the terminated arrangements within twelve
(12) months of the termination of the arrangements;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Upon the Bank's dissolution or with the approval of a bankruptcy court provided that the amounts deferred
under the Agreement are included in the Director's gross income in the latest of (i) the calendar year in which the Agreement terminates;
(ii) the calendar year in which the amount is no longer subject to a substantial risk of forfeiture; or (iii) the first calendar year
in which the distribution is administratively practical; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Upon the Bank's termination of this and all other arrangements that would be aggregated with this Agreement
pursuant to Treasury Regulations Section l.409A-l(c) if the Director participated in such arrangements ("Similar Arrangements"),
provided that (i) the termination and liquidation does not occur proximate to a downturn in the financial health of the Company, (ii)
all termination distributions are made no earlier than twelve (12) months and no later than twenty-four (24) months following such termination,
and (iii) the Bank does not adopt any new arrangement that would
be a Similar Arrangement for a minimum of three (3) years following the date the Bank takes all necessary action to irrevocably terminate
and liquidate the Agreement;

the Bank may distribute the vested Accrual Balance, determined as of the date of the termination of the Agreement, to the Director in a lump sum subject to the above terms.

MERCER SAVINGS BANK

Director Retirement Agreement

**IN WITNESS OF THE ABOVE,** the Director and the Bank hereby consent to this First Amendment.

---

| | | |
|:---|:---|:---|
| Director: | Mercer Savings Bank | Mercer Savings Bank |
| /s/ Richard A. Mosier | By | /s/ J. Douglas Temple |
| Richard A. Mosier | Title | Pres/CEO |

---

## Exhibit 10.6

**Exhibit 10.6**

**AMENDMENT** 

**TO THE**

**MERCER SAVINGS BANK** 

**DIRECTOR RETIREMENT** 

**THIS AMENDMENT** to the Director Retirement Agreement (the "Agreement") is entered into by and between Mercer Savings Bank, a savings association located in Celina, Ohio (the "Bank") and [Name] (the "Director"), on this<u> </u>day of<u> </u> 2023.

**WHEREAS,** the Agreement was entered into on [date]; and

**WHEREAS,** pursuant to Section 7.1 of the Agreement, the Agreement may be amended in certain respects at any time by written agreement between the Bank and the Director; and

**WHEREAS,** the Bank and the Director desire to amend the Agreement to convert it into a defined contribution, account balance plan and to allow the Director to instruct the Bank with respect to the investment of the account balance into certain investment alternatives and to make certain other administerial changes; and

**WHEREAS,** no part of this Amendment is intended to accelerate the timing, or change the form, of any payment due under the Agreement.

**NOW THEREFORE,** the Plan is hereby amended, effective as of [date], 2023, as follows:

**First** 

Section 1.1 of the Agreement is deleted in its entirety and replaced with the following new Section 1.1:

"Account" means a bookkeeping account maintained by the Bank in the name of the Director. The Director's Account shall consist of the following sub-Accounts: (i) Cash Account, a sub-account that is credited with all investments other than assets credited to the Stock Units Account; (ii) Stock Units Account, a sub-account that is credited with Stock Units; and (iii) such other sub-accounts as the Board of Directors of the Bank may deem necessary. The Stock Units Account (i) may not be diversified; (ii) must remain at all times credited with units that represent Common Stock; and (iii) must be distributed solely in the form of Common Stock. A Director's Account shall be utilized solely as a device for the measurement and determination of any benefits payable to a Participant pursuant to this Plan. A Participant shall have no interest in his Account, nor shall it constitute or be treated as a trust fund of any kind. As of [date], the value of the Director's Account (all of which shall be credited to the Cash Account) shall equal [amount]. Each year during the Director's service with the Bank, the Bank shall contribute to the Director's Account equal to the amount set forth on Schedule A to the Agreement."

**Second**

Section 1.5 is deleted in its entirety and replaced with the following new Section 1.5:

"<u>Change in Control</u> means: (i) a change in the ownership of the Bank or Mercer Bancorp, Inc. (the "Company"); (ii) a change in the effective control of the Bank or the Company; or (iii) a change in the ownership of a substantial portion of the assets of the Bank or the Company as defined in accordance with Code Section 409A; provided, however, that notwithstanding anything herein to the contrary, a Change in Control will not be deemed to have occurred for purposes of this Agreement as a result of the conversion of the Bank from the mutual to stock form and the related stock offering of the Company.

**Third**

Section 2.1.1 of the Agreement is deleted in its entirety and replaced with the following new Section 2.1.1:

"<u>Amount of Benefit</u>. The benefit under this Section 2.1 is the amount of the Director's Account immediately prior to Normal Retirement Date, determined by vesting the Director in thirty-three percent (33%) of the Account balance after six Years of Service to the Board through year 10, sixty-six percent (66%) of the Account balance after Year 10 and through Year 18 and one hundred percent (100%) of the Account balance after Year 18. Service on the Board prior to the Effective Date of this Agreement shall be credited for the purposes of determining the vested benefit."

**Fourth**

Section 2.1.2 shall be deleted in its entirety and replaced with the following new Section 2.1.2:

"<u>Distribution of Benefit</u>. The Bank shall distribute the benefit to the Director in twelve (12) approximately equal monthly installments commencing on the first day of the month following Normal Retirement Date. The annual benefit shall be distributed to the Director for ten (10) years. During the period of benefit distributions, the Account shall continue to be credit with earnings until the entire vested benefit has been distributed to the Director."

**Fifth**

Section 2.2.1 of the Agreement is deleted in its entirety and replaced with the following new Section 2.2.1:

"<u>Amount of Benefit</u>. The benefit under this Section 2.2 is the amount of the Director's Account immediately prior to Separation from Service, determined by vesting the Director in thirty-three percent (33%) of the Account balance after six Years of Service to the Board through year 10, sixty-six percent (66%) of the Account balance after Year 10 and through Year 18 and one hundred percent (100%) of the Account balance after Year 18. Service on the Board prior to the Effective Date of this Agreement shall be credited for the purposes of determining the vested benefit."

**Sixth**

Section 2.4.1 of the Agreement is deleted in its entirety and replaced with the following new Section 2.4.1:

"<u>Amount of Benefit</u>. The benefit under this Section 2.4 is the amount of the Director's Account immediately prior to date on which the Separation from Service occurs, except by vesting the Director one hundred percent (100%) in the Account balance."

**Seventh**

Section 3.1.1 of the Agreement is deleted in its entirety and replaced with the following new Section 3.1.1:"<u>Amount of Benefit</u>. The benefit under this Section 3.1 is the Account balance. The Director is one hundred percent (100%) vested in the benefit."

**Eighth**

The following new Article 10 shall be added to the Agreement:

**"Article 10**

**Investment of Account**

10.1  **<u>General</u>** . Amounts credited to the Account under this Agreement will be credited to one or
more bookkeeping accounts (including the Cash Account and/or the Stock Units Account) for a Director in accordance with a Director's
investment election (subject to the ability of the Board to override the investment election at its sole discretion) on an investment
election form supplied by the Bank (the "Investment Election Form"), a copy of which is attached as Exhibit 1. All amounts
credited to the Account as of [date] shall be credited to the Cash Account. The Director's ultimate deferred compensation payments
shall be based on the aggregate value of the Cash Account and the aggregate number of Stock Units accrued in the Stock Units. For purposes
of this provision, the term "Stock Units" mean shares of Common Stock (as defined in Section 10.2), with each Stock Unit representing
one share of Common Stock.

10.2  **<u>Stock Units Account – One-Time Election/Opportunity</u>** . In connection with the initial
stock offering of Mercer Bancorp, Inc. (the "Offering"), the Director may elect that all or any part of amounts contributed
to the Director's Account, which is vested, be credited to the Stock Units Account ("Amount Invested"). The Director
may not make any such election following the Offering. All amounts credited to the Stock Units Account shall be applied to the crediting
of Stock Units. The number of Stock Units credited to the Director's Stock Units Account shall equal the Amount Invested divided
by the fair market value of one share of common stock as of Mercer Bancorp, Inc. (the "Common Stock") on the date of the Offering.
Fractional Stock Units will be used. Each Stock Unit shall be deemed to pay dividends as if it were one share of Common Stock, and any
such deemed dividends will result in the crediting of additional Stock Units to the Stock Units Account as of the date the dividend is
paid with the number of Stock Units so credited to be calculated based on the fair market value of one share of Common Stock as of the
date the dividend is paid. After the crediting of Stock Units to the Stock Units Account, subsequent fluctuations in the fair market value
of the Common Stock shall not result in any change in the number of such Stock Units then credited to the Stock Units Account.

10.3  **<u>Cash Account</u>** . Any amount that the Director does not elect to be credited to the Stock Units
Account shall remain in the Director's Cash Account and such amounts shall continue to be credited with an determined from time
to time by the Board.

10.4  **<u>Adjustments</u>** . In the event of any change in the outstanding Common Stock by reason of any
stock dividend or split, recapitalization, merger, consolidation, spin-off, reorganization, combination or exchange of shares or other
similar corporate change, then the Stock Units Account of shall be adjusted by the Board in a reasonable manner to compensate for the
change, and any such adjustment by the Board shall be conclusive and binding for all purposes of the Plan.

10.5  **<u>Transfers</u>** . Neither the Director nor the Board are permitted to transfer amounts
 between the Cash Account and the Stock Units Account, with the exception that the Director will be given the ability in connection
 with the mutual to stock conversion of the Bank to transfer amounts from the Cash Account to the Stock Units Account, as provided
 for in Section 10.2."

10.6  **<u>Distributions</u>** . "Any distribution from the Stock Units Account must be solely in
 the form of whole shares of Common Stock and cash will not be distributed in lieu of fractional shares."

**Ninth**

This Amendment is intended to comply with Section 409A of the Internal Revenue Code of 1986, as amended, and this Amendment does not change the time or form of any distribution under the Agreement.

**Tenth**

Notwithstanding anything to the contrary contained herein, this Amendment shall be subject to the consummation of the Conversion of the Bank and the Stock Offering of Mercer Bancorp, Inc. In the event the Conversion and Offering do not occur, this Amendment shall be deemed null and void.

[signature page to follow]

**IN WITNESS WHEREOF,** the Bank and the Director have caused this Amendment to be executed on the date first written above.

---

| | |
|:---|:---|
| **DIRECTOR** | **MERCER SAVINGS BANK** |
| Director | By: Alvin B. Parmiter |
|  | Title: President and Chief Executive Officer |

---

## Exhibit 16.1

**Exhibit 16.1**

![](tm238570d1_ex16-1img01.jpg)

Crowe LLP <br> Independent Member Crowe Global

Securities and Exchange Commission

Washington, D.C. 20549

Commissioners:

We have read the statements of Mercer Bancorp, Inc., included in the prospectus under the heading "Change in Auditor," contained within its Registration Statement on Form S-1 filed on March 10, 2023, and we agree with such statements concerning our firm.

![](tm238570d1_ex16-1img02.jpg)

Crowe LLP

March 10, 2023

Columbus, Ohio

## Exhibit 16.2

**Exhibit 16.2**

![](tm238570d1_ex16-2img01.jpg)

Securities and Exchange Commission

Washington, D.C. 20549

Commissioners:

We have read the statements of Mercer Bancorp, Inc., included in the prospectus under the heading "Change in Auditor," contained within its Registration Statement on Form S-1 filed on March 10, 2023, and we agree with such statements concerning our firm.

/s/ Dixon, Davis, Bagent & Co.

Dixon, Davis, Bagent & Co.

March 10, 2023

Granville, Ohio

![](tm238570d1_ex16-2img02.jpg)

## Ex-21

**Exhibit 21**

**Subsidiaries of the Registrant**

The following is a list of the subsidiaries of Mercer Bancorp, Inc.:

<u>Name</u> <u>State/Jurisdiction of Incorporation</u> <br>Mercer Savings Bank Ohio

## Exhibit 23.2

**Exhibit 23.2**

![](tm238570d1_ex23-2img01.jpg)

March 10, 2023

The Boards of Directors

Mercer Savings Bank

Mercer Bancorp, Inc.

1100 Irmscher Blvd

Celina, Ohio 45822

Members of the Boards:

We hereby consent to the use of our firm's name in the Registration Statement on Form S-1 and any amendments thereto, to be filed by Mercer Bancorp, Inc., with the Securities and Exchange Commission. We also hereby consent to the inclusion of, summary of and references to our appraisal and our statement concerning subscription rights and liquidation rights in such filings, including the prospectus of Mercer Bancorp, Inc. and being named as an expert in the Prospectus.

Sincerely,

FINPRO CAPITAL ADVISORS, INC.

![](tm238570d1_ex23-2img02.jpg)

**46 East Main Street ● Suite 303 ● Somerville, NJ 08876 ● 908.234.9398 ● <u>www.finprocapitaladvisors.com</u>**

FinPro Capital Advisors, Inc. (Member FINRA/SIPC) is a wholly owned subsidiary of FinPro, Inc.

## Exhibit 23.3

**Exhibit 23.3**

![](tm238570d1_ex23-3img01.jpg)

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the use of our audit report in this Registration Statement on Form S-1 of Mercer Bancorp, Inc. of our report dated March 10, 2023, relating to our audit of Mercer Savings Bank's balance sheets as of September 30, 2022 and 2021, and the related statements of income, comprehensive income, changes in equity, and cash flows for the years then ended, appearing in the Prospectus that is part of this Registration Statement.

We also consent to the reference to our firm under the heading "Experts" in the Prospectus that is part of the Registration Statement.

![](tm238570d1_ex23-3img02.jpg)

Cranberry Township, Pennsylvania

March 10, 2023

---

| | | | |
|:---|:---|:---|:---|
| PITTSBURGH, PA | PHILADELPHIA, PA | WHEELING, WV | STEUBENVILLE, OH |
| 2009 Mackenzie Way • Suite 340 | 2100 Renaissance Blvd. • Suite 110 | 980 National Road | 511 N. Fourth Street |
| Cranberry Township, PA 16066 | King of Prussia, PA 19406 | Wheeling, WV 26003 | Steubenville, OH 43952 |
| (724) 934-0344 | (610) 278-9800 | (304) 233-5030 | (304) 233-5030 |

---

S.R. Snodgrass, P.C. d/b/a S.R. Snodgrass, A.C. in West Virginia

## Exhibit 99.1

**Exhibit 99.1**

**Professional Services Agreement**

This Professional Services Agreement (this "**Agreement**") is by and between FinPro, Inc., a New Jersey corporation, with offices located at 46 East Main Street, Somerville, New Jersey, 08876 (the "**Service Provider**") and the undersigned client (the "**Client**"), whose address is set forth in the accompanying Statement of Work. This Agreement is effective when signed by both parties (the "**Effective Date**").

WHEREAS, Service Provider has the capability and capacity to provide certain consulting services; and

WHEREAS, Client desires to retain Service Provider to provide the said services, and Service Provider is willing to perform such services under the terms and conditions hereinafter set forth;

NOW, THEREFORE, in consideration of the mutual covenants and agreements hereinafter set forth and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Service Provider and Customer agree as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. <u>Services</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1 Service Provider shall provide to Client the services (the "**Services**") set out in one or more statements of work with specific service sheets to be issued by Service Provider and accepted by Client (each, a "**SOW**"). Service Provider shall provide the Services to Client as described in more detail in each SOW and service sheets in accordance with the terms and conditions of this Agreement. Any SOW entered into shall be deemed to be entered into hereunder unless such SOW explicitly recites that it is entered into pursuant to another professional services agreement. If there is a conflict between the terms of this Agreement and the terms of any SOW, the terms of the SOW control and take precedence.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2 Each SOW shall include the following information, if applicable:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) a detailed description of the Services to be performed pursuant to the SOW and/or Service Sheets;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the date upon which the Services will commence and the term of such SOW;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) the fees and expenses to be paid to Service Provider under the SOW;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) deliverables and payment schedules;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) any criteria for specific completion of the Services; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) any other terms and conditions agreed upon by the parties in connection with the Services to be performed pursuant to such SOW.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. <u>Client's Obligations</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1 Client shall:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) provide Service Provider with all financial and other information, whether or not publicly available, necessary to familiarize Service Provider with the business and operations of the Client. The Client recognizes that Service Provider will rely upon such information and data received from the Client and its advisors without independent verification. Service Provider does not assume responsibility for the accuracy or completeness of such information received from the Client;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) allow Service Provider the opportunity, from time to time, to discuss the material business and operations of the Client with the appropriate Client personnel for the purposes of performing the Services;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) cooperate with Service Provider in all matters relating to the Services and provide such access to Client's premises, and such office accommodation and other facilities as may reasonably be requested by Service Provider, for the purposes of performing the Services;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) promptly review all work products of Service Provider and respond promptly to any Service Provider request to provide direction, information, approvals, authorizations or decisions that are reasonably necessary for Service Provider to perform Services in accordance with the requirements of this Agreement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) in the format requested by the Service Provider, provide such materials, data or information as Service Provider may request to carry out the Services in a timely manner and ensure that such Client materials or information are complete and accurate in all material respects;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) promptly advise Service Provider of any material or contemplated material transactions which may have an effect on the day-to-day operations of the Client;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) have system download capability and, when applicable provide pertinent downloads and other data which tie to trial balances; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) obtain and maintain all necessary licenses and consents and comply with all applicable laws in relation to the Services before the date on which the Services are to start.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2 If Service Provider's performance of its obligations under this Agreement is prevented or delayed by any act or omission of Client or its agents, subcontractors, consultants or employees, Service Provider shall not be deemed in breach of its obligations under this Agreement or otherwise liable for any costs, charges or losses sustained or incurred by Client, in each case, to the extent arising directly or indirectly from such prevention or delay.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3 If Client data, materials or other information provided to the Service Provider is incomplete, inaccurate, or does not conform to the format required by the Service Provider, and Client is unable to remedy any such issue in a timely fashion, Service Provider may extend the timeline for delivery of Services outlined in a given SOW, or in the alternative, may charge additional fees of a minimum of $2,000 for the additional time and effort required to resolve the data issues.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. <u>Change Orders</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1 The scope of services and fees contained in the SOW are based on current laws and regulations. If changes in law or regulations change the Client's requirements or the scope of the work, the fees under the SOW will be modified to a mutually agreed upon amount to reflect the changed level of Service Provider's effort in accordance with the procedures set forth below.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2 If either party wishes to change the scope or performance of the Services, it shall submit details of the requested change to the other party in writing. Service Provider shall, within a reasonable time after such request, provide a written estimate to Client of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the likely time required to implement the change;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) any necessary variations to the fees and other charges for the Services arising from the change;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) the likely effect of the change on the Services; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) any other impact the change might have on the performance of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.3 Promptly after receipt of the written estimate, the parties shall agree in writing on the terms of such change (a "**Change Order**"). Neither party shall be bound by any Change Order unless mutually agreed upon in writing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4. <u>Performance Dates and Term</u>.

Service Provider shall use reasonable efforts to meet any performance dates specified in the SOW, and any such dates shall be estimates only. This Agreement shall commence as of the Effective Date and shall continue thereafter until the completion of the Services under all Statements of Work, unless sooner terminated pursuant to this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5. <u>Fees and Expenses; Payment Terms</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1 In consideration of the provision of the Services by the Service Provider and the rights granted to Client under this Agreement, Client shall pay the fees set forth in the SOW, including any reimbursement all reasonable travel and out-of-pocket or pass-through expenses incurred by Service Provider in connection with the performance of the Services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2 All fees and expenses shall be paid to Service Provider as set out in the applicable SOW. Service Provider shall issue invoices to Client only in accordance with the terms of this Section and the applicable SOW, and Client shall pay all properly invoiced amounts due to Service Provider within 30 days after Client's receipt of such invoice, except for any amounts disputed by Client in good faith. All payments hereunder shall be in US dollars and made by check or wire transfer. Service Provider utilizes an electronic billing and collection procedure. Upon execution of this Agreement, Client shall indicate the appropriate e-mail address to direct wire instructions and any future correspondence regarding billing and collections.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3 In the event payments are not received by Service Provider within thirty (30) days after becoming due, Service Provider may:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) charge interest on any such unpaid amounts at a rate of 7% per annum or, if lower, the maximum amount permitted under applicable law, from the date such payment was due until the date paid; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) suspend performance for all Services until payment has been made in full.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.4 Client shall be responsible for all sales, use and excise taxes, and any other similar taxes, duties and charges of any kind imposed by any federal, state or local governmental entity on any amounts payable by Client hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6. <u>Intellectual Property Rights; Ownership</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1 All intellectual property rights, including copyrights, patents, patent disclosures and inventions (whether patentable or not), trademarks service marks, trade secrets, know-how and other confidential information, trade dress, trade names, logos, corporate names and domain names, together with all of the goodwill associated therewith, derivative works and all other rights (collectively, "**Intellectual Property Rights**") of Service Provider shall be owned by Service Provider, and Service Provider hereby grants to Client a license to use all Intellectual Property Rights free of additional charge on a non-exclusive, worldwide, non-transferable, non-sublicensable, fully paid-up, royalty-free and perpetual basis to the extent necessary to enable Client to make reasonable use of the Deliverables (as defined below) and the Services. All documents and other materials that are delivered to Client under this Agreement in the course of performing the Services, including any items identified as such in the SOW (collectively, the "**Deliverables**"), including any Confidential Information of Client or Client materials, but excluding any Intellectual Property Rights or other proprietary work product of the Service Provider contained in such Deliverables and licensed to Client pursuant to this Section 6.1, shall be owned by Client.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2 With the exception of Resultant Data, Client and its licensors are, and shall remain, the sole and exclusive owner of all right, title and interest in and to Client data, including all Intellectual Property Rights therein. "**Resultant Data**" means information, data and other content that is derived by or through the Services from processing Client data and is sufficiently different from such Client data that such Client data cannot be reverse engineered or otherwise identified from the inspection, analysis or further processing of such information, data or content. Service Provider retains all Intellectual Property Rights in the Resultant Data.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7. <u>Confidential Information</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1 Service Provider has executed a Confidentiality Agreement (the "**Confidentiality Agreement**") with the Client. The Client acknowledges that all opinions, valuations and advice (written or oral) given by Service Provider to the Client in connection with Service Provider's engagement are intended solely for the benefit and use of the Client (and its directors, management, and advisors) and the Client's regulators in connection with the matters contemplated hereby. Client agrees that no such opinion, valuation, or advice shall be used for any other purpose, except with respect to the opinion and valuation which may be used for the proper corporate purposes of the Client, or reproduced, or disseminated, quoted or referred to at any time, in any manner or for any purpose, nor shall any public references to Service Provider be made by the Client (or such persons), without the prior written consent of Service Provider, which consent shall not be unreasonably withheld.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2 All Confidential Information, as defined in the Confidentiality Agreement, shall be subject to the terms and conditions of the Confidentiality Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.3 Client agrees to use the Confidential Information only to make use of the Services and Deliverables.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. <u>Data Security</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1 The Service Provider acknowledges that the Client is subject to federal, state and foreign law, rules, regulations, directives and governmental or data protection authority decisions applicable to the collection, use, processing, storage, destruction and or disclosure of Personal Information, including but not limited to the Gramm-Leach-Bliley Act of 1999, as amended (the **"GLBA"**), and its implementing regulations and guidelines, Federal Trade Commission Financial Privacy Rule, 16 C.F.R. § 313.1 et seq., and regulatory and other agency standards and guidance for information security, privacy and confidentiality (sometimes collectively referred to herein as the **"Privacy Laws"**).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2 Service Provider has established and will maintain an information security program that complies in all material respects with the objectives outlined in the Interagency Guidelines Establishing Standards for Safeguarding Customer Information (12 CFR Part 364) (the **"Guidelines"**), and any other applicable Privacy Laws that address the protection of all nonpublic personal information as defined by Title V of the GLBA, including, but not limited to information provided by or obtained about a person with respect to name, sex, date of birth, age, income, address, telephone number, Social Security number, account information, health or medical information, and/or credit information (**"Customer Data"**). Service Provider's information security program will include administrative, technical and physical safeguards designed to achieve the following objectives in compliance with the Guidelines: (i) to protect the security and confidentiality of Customer Data; (ii) to protect against any anticipated threats or hazards to the security or integrity of Customer Data; (iii) to protect against unauthorized access to or use of such information that could result in substantial harm or inconvenience to Client's customers; (iv) to implement and maintain an active incident response program; and (v) to ensure the proper disposal of Customer Data. If a breach of security or other unauthorized intrusion or access to Customer Data occurs while in the possession of Service Provider, Service Provider will promptly report to Client regarding the nature and extent of the information security incident and the corrective action taken by Service Provider in response.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3 Service Provider agrees that any Customer Data of the Client shall be subject to the Confidentiality Agreement and shall be maintained in confidence and not disclosed, sold, transferred, or brokered for marketing except as permitted in the Agreement or as otherwise permitted by the Client.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.4 Service Provider will maintain all original Client data to the extent required for applicable legal or regulatory purposes or established document retention policies, and shall not be required to destroy, alter or modify any automated backup or other archival processes.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9. <u>Representations, Warranties and Vendor Management</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1 Service Provider represents and warrants to Client that it shall perform the Services using personnel of required skill, experience and qualifications and in a professional and workmanlike manner in accordance with generally recognized industry standards for similar services and shall devote adequate resources to meet its obligations under this Agreement. Service Provider and Client are not affiliated, and neither Service Provider nor Client has an economic interest in, or is held in common with, the other or has derived a significant portion of its gross revenues, receipts, or net income for any period from transactions with the other. Service Provider represents and warrants that it is not aware of any fact or circumstance that would cause it not to be "independent" within the meaning of the conversion regulations of the federal banking agencies or otherwise prohibit or restrict it in anyway from serving in the role of independent appraiser for Client. Service Provider makes no other warranties whatsoever.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.2 In the event that Service Provider utilizes a third-party to assist it in performing its duties under the Agreement or any related agreement, such third-party will be held to the same standard of service as the Service Provider and will be required to maintain the same level of data security and confidentiality as the Service Provider.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.3 Service Provider understands that in some cases the Client may be obligated by regulation to perform a certain level of due diligence regarding its vendors. To that end, in addition to the previously executed Confidentiality Agreement with the Client, the Service Provider agrees to provide the Client on an annual basis copies of: (i) FinPro's Data Security Policy, (ii) most recent SOC-1/Type II report for Microsoft Azure for online data transmission and storage, and where applicable, the most recent Bridge Letter from Microsoft regarding the same; (iii) most recent SSAE 18 SOC II Report for Microsoft Office 365 for secure online communication and productivity tools, and where applicable, the most recent Bridge Letter from Microsoft regarding the same; (iv) most recent SOC-2/Type II report for FinPro' applications and cloud-based systems/environment; (v) FinPro's Business Continuity Plan; (vi) FinPro's Acceptable Use Policy; (vii) FinPro's Terms of Use (which can be found at <u>https://www.finpro.us/terms-of-use.html</u>); (viii) FinPro's Privacy Policy (which can be found at <u>https://www.finpro.us/privacy.html</u>); (ix) general vendor management questionnaire; (x) Certificate of Insurance for cyber liability; (xi) most recent Certificate of Good Standing for New Jersey; and (xii) most recent W-9 for FinPro, Inc. The Client and the Service Provider agree that the foregoing documents shall be sufficient to meet any regulatory requirements for vendor management.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10. <u>Indemnification and Reimbursement</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1 Service Provider shall defend, indemnify and hold harmless Client and its officers, directors, employees, agents, successors and permitted assigns (each, a "**Client Indemnitee**") from and against all costs, fees, expenses, damages, and liabilities, including defense costs and legal fees associated with such third-party claim arising out of or resulting from any third-party claim, suit, action or proceeding (each, an "**Action**") resulting from:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) bodily injury, death of any person or damage to real or tangible, personal property resulting from the willful, bad faith, fraudulent or grossly negligent acts or omissions of Service Provider or Service Provider Personnel; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Service Provider's material breach of any representation, warranty or obligation of Service Provider set forth in this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2 Client shall defend, indemnify and hold harmless Service Provider and Service Provider's Affiliates and their officers, directors, employees, agents, successors and permitted assigns from and against all costs, fees, expenses, damages, and liabilities, including defense costs and legal fees associated with such third-party claim arising out of or resulting from any third-party Action arising out of or resulting from:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) bodily injury, death of any person or damage to real or tangible, personal property resulting from the grossly negligent, bad faith, or willful acts or omissions of Client; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Client's material breach of any representation, warranty or obligation of Client in this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.3 In addition to the indemnification set forth above, the Client shall reimburse Service Provider promptly for any legal or other expenses reasonably incurred by it in connection with investigating, preparing to defend or defending, or providing evidence in or preparing to serve or serving as a witness with respect to, any lawsuits, investigations, claims or other proceedings arising in any manner out of or in connection with the rendering of services by Service Provider hereunder or the rendering of additional services by Service Provider as requested by the Client that are related to the services rendered hereunder (including, without limitation, in connection with the enforcement of this Agreement and the indemnification obligations set forth herein); unless it is finally judicially determined that such losses, claims, damages or liabilities resulted directly from the gross negligence, bad faith, or willful misconduct of Service Provider. In the event Service Provider becomes aware of any such claim or possible claim, it shall notify the Client as soon as possible. This indemnification shall apply to the full extent allowed by law. Notwithstanding any other provision of this Agreement, any payments made by the Bank shall be in accordance with federal banking law and regulations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11. <u>LIMITATION OF LIABILITY</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.1 IN NO EVENT SHALL SERVICE PROVIDER BE LIABLE TO CLIENT OR TO ANY THIRD PARTY FOR ANY LOSS OF USE, REVENUE OR PROFIT OR LOSS OF DATA OR DIMINUTION IN VALUE, OR FOR ANY CONSEQUENTIAL, INCIDENTAL, INDIRECT, EXEMPLARY, SPECIAL OR PUNITIVE DAMAGES WHETHER ARISING OUT OF BREACH OF CONTRACT, TORT (INCLUDING NEGLIGENCE) OR OTHERWISE, REGARDLESS OF WHETHER SUCH DAMAGES WERE FORESEEABLE AND WHETHER OR NOT SERVICE PROVIDER HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, AND NOTWITHSTANDING THE FAILURE OF ANY AGREED OR OTHER REMEDY OF ITS ESSENTIAL PURPOSE.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.2 IN NO EVENT SHALL SERVICE PROVIDER'S AGGREGATE LIABILITY ARISING OUT OF OR RELATED TO THIS AGREEMENT, WHETHER ARISING OUT OF OR RELATED TO BREACH OF CONTRACT, TORT (INCLUDING NEGLIGENCE) OR OTHERWISE, EXCEED THE AGGREGATE AMOUNTS PAID OR PAYABLE TO SERVICE PROVIDER PURSUANT TO THIS AGREEMENT.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.3 The limitation of liability set forth in this Section shall not apply to (i) liability resulting from Service Provider's gross negligence, bad faith, or willful misconduct and (ii) death or bodily injury resulting from Service Provider's negligent acts or omissions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12. <u>Termination; Acceleration</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.1 Either party may terminate this Agreement, effective upon written notice to the other party (the "**Defaulting Party**"), if the Defaulting Party:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) materially breaches this Agreement, and such breach is incapable of cure, or with respect to a material breach capable of cure, the Defaulting Party does not cure such breach within thirty (30) days after receipt of written notice of such breach.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) (i) becomes insolvent or admits its inability to pay its debts generally as they become due; (ii) becomes subject, voluntarily or involuntarily, to any proceeding under any domestic or foreign bankruptcy or insolvency law, which is not fully stayed within seven business days or is not dismissed or vacated within 45 days after filing; (iii) is dissolved or liquidated or takes any corporate action for such purpose; (iv) makes a general assignment for the benefit of creditors; or (v) has a receiver, trustee, custodian or similar agent appointed by order of any court of competent jurisdiction to take charge of or sell any material portion of its property or business.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.2 If at any time during the term of this Agreement the Client undergoes a change of control, or terminates this Agreement for any other reason than failure to perform by the Service Provider, then the remaining fees under the Agreement will be accelerated and become due in full at the time of closing of the change of control or termination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13. <u>NON-SOLICITATION</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.1 Both parties understand and acknowledge that the other party has expended and continues to expend significant time and expense in recruiting and training its employees and that the loss of employees would cause significant and irreparable harm to either party, respectively. Both parties agree and covenant not to solicit directly or indirectly, hire, recruit, attempt to hire or recruit, or induce the termination of employment of any employee of the other party during the term of this Agreement or any SOW, or within twelve (12) months from the termination of this Agreement or any SOW, to run consecutively, beginning on the last day of the Agreement. A general advertisement or notice of a job listing or opening or other similar general publication of a job search or availability to fill employment positions, including on the internet, shall not be construed as a solicitation or inducement for the purposes of this Section, and the hiring of any such employees or independent contractor who freely responds thereto shall not be a breach of this Section.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.2 Both parties agree that any breach of the foregoing obligation would result in harm to the non-breaching party and that the amount of legal damages would be difficult to determine. Accordingly, both parties agree that for each such employee retained in breach of this Section, the breaching party shall pay the non-breaching party a sum of two (2) times the annual compensation to be paid by the breaching party to such employee as liquidated damages. Both parties agree that such liquidated damages constitute a reasonable estimate of the damages that would accrue to the non-breaching party and do not constitute a penalty.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14. <u>Miscellaneous</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.1 Neither party may assign, transfer or delegate any or all of its rights or obligations under this Agreement, without the prior written consent of the other party, which consent shall not be unreasonably withheld or delayed; provided, that, upon prior written notice to the other party, either party may assign the Agreement to an Affiliate of such party or to a successor of all or substantially all of the assets of such party through merger, reorganization, consolidation or acquisition. No assignment shall relieve the assigning party of any of its obligations hereunder. Any attempted assignment, transfer or other conveyance in violation of the foregoing shall be null and void. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and permitted assigns.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.2 The relationship between the parties is that of independent contractors. Nothing contained in this Agreement shall be construed as creating any agency, partnership, joint venture or other form of joint enterprise, employment or fiduciary relationship between the parties, and neither party shall have authority to contract for or bind the other party in any manner whatsoever.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.3 This Agreement is for the sole benefit of the parties hereto and their respective successors and permitted assigns and nothing herein, express or implied, is intended to or shall confer upon any other person or entity any legal or equitable right, benefit or remedy of any nature whatsoever under or by reason of this Agreement or any SOW.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.4 No Party shall be liable or responsible to the other party, nor be deemed to have defaulted or breached this Agreement, for any failure or delay in fulfilling or performing any term of this Agreement when and to the extent such failure or delay is caused by or results from acts or circumstances beyond the reasonable control of that party including, without limitation, acts of God, flood, fire, earthquake, explosion, governmental actions, war, invasion or hostilities (whether war is declared or not), terrorist threats or acts, riot, or other civil unrest, national emergency, revolution, insurrection, epidemic, lock-outs, strikes or other labor disputes (whether or not relating to either party's workforce), pandemic or restraints or delays affecting carriers or inability or delay in obtaining supplies of adequate or suitable materials, materials or telecommunication breakdown or power outage, provided that, if the event in question continues for a continuous period in excess of fifteen (15) days, each party shall be entitled to give notice in writing to the other party to terminate this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.5 All notices, requests, consents, claims, demands, waivers and other communications hereunder (each, a "**Notice**") shall be in writing and addressed to the parties at the addresses set forth in the SOW or to such other address that may be designated by the receiving party in writing. All Notices shall be delivered by personal delivery, nationally recognized overnight courier (with all fees pre-paid), facsimile (with confirmation of transmission) or certified or registered mail (in each case, return receipt requested, postage prepaid). Except as otherwise provided in this Agreement, a Notice is effective only (a) upon receipt of the receiving party, and (b) if the party giving the Notice has complied with the requirements of this Section.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.6 This Agreement, together with any Confidentiality Agreement, and all Schedules, Exhibits and Statements of Work and any other documents incorporated herein by reference, constitutes the sole and entire agreement of the parties to this Agreement with respect to the subject matter contained herein, and supersedes all prior and contemporaneous understandings and agreements, both written and oral, with respect to such subject matter. In the event of any conflict between the terms and provisions of this Agreement and those of any Schedule, Exhibit or SOW, the following order of precedence shall govern: (a) first, the applicable SOW; (b) second, this Agreement, exclusive of its Exhibits and Schedules; and (c) third, any Exhibits and Schedules to this Agreement; and (d) fourth, the Confidentiality Agreement, if any.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.7 The headings in this Agreement are for reference only and shall not affect the interpretation of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.8 This Agreement may only be amended, modified or supplemented by an agreement in writing signed by each party hereto. No waiver by any party of any of the provisions hereof shall be effective unless explicitly set forth in writing and signed by the party so waiving. Except as otherwise set forth in this Agreement, no failure to exercise, or delay in exercising, any rights, remedy, power or privilege arising from this Agreement shall operate or be construed as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.9 If any term or provision of this Agreement is invalid, illegal or unenforceable in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render unenforceable such term or provision in any other jurisdiction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.10 This Agreement shall be governed by and construed in accordance with the internal laws of the State of New Jersey without giving effect to any choice or conflict of law provision or rule (whether of the State of New Jersey or any other jurisdiction) that would cause the application of Laws of any jurisdiction other than those of the State of New Jersey. Any legal suit, action or proceeding arising out of or related to this Agreement or the Services provided hereunder shall be instituted in the federal courts of the United States or the courts of the State of New Jersey in each case located in the city of Somerville and County of Somerset, and each party irrevocably submits to the exclusive jurisdiction of such courts in any such suit, action or proceeding. Service of process, summons, notice or other document by mail to such party's address set forth herein shall be effective service of process for any suit, action or other proceeding brought in any such court.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.11 Each party irrevocably and unconditionally waives any right it may have to a trial by jury in respect of any legal action arising out of or relating to this Agreement or the transactions contemplated hereby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.12 In the event that any action, suit, or other legal or administrative proceeding is instituted or commenced by either party hereto against the other party arising out of or related to this Agreement, the prevailing party shall be entitled to recover its reasonable attorneys' fees and court costs from the non-prevailing party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.13 Provisions of this Agreement, which by their nature should apply beyond their terms, will remain in force after any termination or expiration of this Agreement, including, but not limited to, the provision related to non-solicitation, confidentiality, indemnification, governing law and jurisdiction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.14 This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall be deemed to be one and the same agreement. A signed copy of this Agreement delivered by facsimile, e-mail or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.

[Remainder of page intentionally left blank. Signature page follows.]

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date last written below.

---

| | | | |
|:---|:---|:---|:---|
| **ACCEPTED BY:** | FinPro Inc. | **SIGNED BY:** | Mercer Savings Bank |
|  | 46 East Main Street, Suite 303 |  | 1100 Irmscher Boulevard |
|  | Somerville, NJ 08876 |  | Celina, OH 45822 |
| Signature: | /s/ Scott Martorana | Signature: | /s/ Alvin B. Parmiter |
| Print Name: | Scott Martorana | Print Name: | Alvin B. Parmiter |
| Title: | Executive Managing Director | Title: | CEO |
| Date: | 2/1/2023 | Date: | 2/1/2023 |

---

**APPRAISAL SCOPE OF WORK**

FinPro, Inc. is pleased to assist the Client and the financial institution ("the Company") by providing appraisal services for the planned offering.

**SCOPE OF WORK:**

*FinPro will perform each of the activities listed below as needed or requested by the Client.*

&nbsp;&nbsp;&nbsp;&nbsp;▪ Conduct
 financial due diligence, including interviews of senior management and reviews of financial
 and other records

&nbsp;&nbsp;&nbsp;&nbsp;▪ Gather
 an understanding of the Bank's current and projected financial condition, profitability,
 risk characteristics, operations and external factors that might influence or impact the
 Bank

&nbsp;&nbsp;&nbsp;&nbsp;▪ Prepare
 a detailed written valuation report of the Bank and the Company, that is consistent with
 applicable regulatory guidelines and standard valuation practices

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o Include
 an in-depth analysis of the operating results and financial condition of the Bank and the
 Company

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o Assess
 the interest rate risk, credit risk and liquidity risk

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o Describe
 the business strategies of the Bank and the Company, the market area, competition and potential
 for the future

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o Include
 a detailed peer analysis of publicly traded savings institutions for use in determining appropriate
 valuation adjustments based upon multiple factors

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o Include
 a midpoint pro forma valuation along with a range of value around the midpoint value

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o Comply,
 in form and substance with all appropriate requirements of regulatory authorities for purposes
 of its use to establish the estimate pro forma market value of the common stock of the Company
 following the Conversion and Stock Offering

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;o The
 valuation report may be periodically updated throughout the Conversion process and will be
 updated at the time of the closing of the Stock Offering

&nbsp;&nbsp;&nbsp;&nbsp;▪ Prepare
 and deliver an opinion, in form and substance acceptable to legal and tax counsel of the
 Bank and the Company, to the effect that the subscription rights granted to eligible account
 holders, the applicable stock benefit plans and others in connection with the stock offering,
 have no value

**INFORMATION REQUIREMENTS OF THE BOARD:**

*To accomplish the tasks set forth above, the following minimum information is requested to be made available during the course of the review. This list is not exhaustive and other items may be requested.* 

 

&nbsp;&nbsp;&nbsp;&nbsp;▪ Provide
 FinPro with all financial and other information, whether or not publicly available, necessary
 to familiarize FinPro with the business and operations of the Bank and the Company

&nbsp;&nbsp;&nbsp;&nbsp;▪ Allow
 FinPro the opportunity, from time to time, to discuss the operations of the Bank and the
 Company with Bank and Company personnel

&nbsp;&nbsp;&nbsp;&nbsp;▪ Promptly
 advise FinPro of any material or contemplated material transactions that may have an effect
 on the day-to-day operations of the Bank and Company

&nbsp;&nbsp;&nbsp;&nbsp;▪ Provide
 FinPro with all support schedules required to compile Regulatory, Board and Management reports

---

| | |
|:---|:---|
| FinPro \| 46 East Main Street \| Suite 303 \| Somerville, NJ 08876 \| 908-234-9398 \| | Initials <u>/s/ BP</u> |

---

&nbsp;&nbsp;&nbsp;&nbsp;▪ Provide
 FinPro with offering circular, prospectus and all other materials relevant to the appraisal
 function for the Conversion

**DELIVERABLES:**

*The following is a list of deliverables that will result from FinPro's effort.*

 

&nbsp;&nbsp;&nbsp;&nbsp;▪ Appraisal
 document

&nbsp;&nbsp;&nbsp;&nbsp;▪ Final
 Appraisal document

---

| | |
|:---|:---|
| FinPro \| 46 East Main Street \| Suite 303 \| Somerville, NJ 08876 \| 908-234-9398 \| | Initials <u>/s/ BP</u> |

---

![](tm238570d1_ex99-1img02.jpg)

**STATEMENT OF WORK**

The undersigned client (the "**Client**" or "**Bank**") hereby requests FinPro, Inc. (the "**Service Provider**" or "**FinPro**") to assist the Client by providing the scope of services detailed on the Service Sheets attached to this Statement of Work (the "**SOW**"). This SOW adopts and incorporates by reference the attached Scope, Service Sheets, and the terms and conditions of the Professional Services Agreement (the "**PSA**") between the Bank and FinPro that was previously entered into on the date set forth below. Please review this SOW and indicate your acceptance where appropriate. We look forward to furthering our relationship with the Bank.

**TERM, FEES & EXPENSES**

**TERM**

This SOW is effective as of the date set forth below (the "**Effective Date**"). Any future work that would require extra expense to the Bank will be proposed on separately from this engagement prior to any work being performed.

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp;**Approximate Timeframe for Completion:** | &nbsp;&nbsp;Six months | &nbsp;&nbsp;Elapsed time to complete all of the tasks outlined in the SOW |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;**Effective Date of PSA:** | &nbsp;&nbsp;2/01/2023 |
| &nbsp;&nbsp;**Effective Date of SOW:** | &nbsp;&nbsp;2/01/2023 |

---

**FEES & EXPENSES**

FinPro's fees for this engagement are set forth below. This fee shall be payable in installments based on the schedule set forth below.

In the event that the Bank needs to be set up on FinPro's systems as part of this engagement, there is also a one-time set-up fee for the Bank and the Bank's users on FinPro's systems which will be invoiced upon signing of this SOW. To the extent that the Bank makes significant changes to its systems (e.g. core conversion) such that FinPro is tasked with resetting the Client on its systems, an additional set up fee will be charged on each such occurrence. A separate e-mail or request will be sent to establish the initial Bank users and permissions.

***\*Please note****: If account level download files and general ledger files are provided in the incorrect format, FinPro is tasked with making corrections to these files, or the report is rerun at the Client's request after the results have been provided to the Client (not due to any error by FinPro), a data/download correction fee will be applied.*

---

| | | |
|:---|:---|:---|
| &nbsp;&nbsp;**Total Fee:** | &nbsp;&nbsp;$35000 | &nbsp;&nbsp;Payable according to the Payment Milestones below |
| &nbsp;&nbsp;**Payment Milestones:** | &nbsp;&nbsp;$10000 | &nbsp;&nbsp;Non-refundable retainer |
|  | &nbsp;&nbsp;$10000 | &nbsp;&nbsp;Payable upon submission of the appraisal to regulators |
|  | &nbsp;&nbsp;$10000 | &nbsp;&nbsp;Payable upon completion of the stock offering |
|  | &nbsp;&nbsp;$5000 | &nbsp;&nbsp;For each appraisal update, this includes the final appraisal |
| &nbsp;&nbsp;**Initial or Subsequent Set-up Fee:** | &nbsp;&nbsp;N/A | &nbsp;&nbsp;If applicable |
| &nbsp;&nbsp;*(if applicable)* |  |  |
| &nbsp;&nbsp;**Data/Download Correction Fee:** | &nbsp;&nbsp;N/A | &nbsp;&nbsp;If applicable |
| &nbsp;&nbsp;*(if applicable)* |  |  |

---

FinPro \| 46 East Main Street \| Suite 303 \| Somerville, NJ 08876 \| 908-234-9398 \| www.finpro.us

![](tm238570d1_ex99-1img02.jpg)

In addition to any fees that may be payable to FinPro hereunder, the Bank hereby agrees to promptly reimburse FinPro for the following:

---

| | |
|:---|:---|
| &nbsp;&nbsp;**OUT-OF-POCKET EXPENSES** | &nbsp;&nbsp;All of FinPro's reasonable travel and other out-of-pocket expenses incurred in connection with FinPro's engagement, not to exceed $5,000 without the prior written consent of the Bank. It is FinPro policy to itemize expenses for each project so that the client can review, by line item, each expense. |
| &nbsp;&nbsp;**DATA COST** | &nbsp;&nbsp;There is a pass-through cost for competitor financial/regulatory data. |
|  | &nbsp;&nbsp;There is a pass-through cost for competitor financial/regulatory data. |
|  | &nbsp;&nbsp;There is a pass-through cost for competitor financial/regulatory data. |
| &nbsp;&nbsp;**BONDS** | &nbsp;&nbsp;There is a pass-through cost for bond and MBS market pricing, CMO cash flows, and MBS prepayment speeds. |
|  | &nbsp;&nbsp;There is a pass-through cost for bond and MBS market pricing, CMO cash flows, and MBS prepayment speeds. |
|  | &nbsp;&nbsp;There is a pass-through cost for bond and MBS market pricing, CMO cash flows, and MBS prepayment speeds. |
| &nbsp;&nbsp;**MARKET DATA** | &nbsp;&nbsp;A market is defined as each branch market or zip code for which specific market data is provided. The purchase of any real estate data will be passed through. |
|  | &nbsp;&nbsp;A market is defined as each branch market or zip code for which specific market data is provided. The purchase of any real estate data will be passed through. |
| &nbsp;&nbsp;*(if necessary)* | &nbsp;&nbsp;A market is defined as each branch market or zip code for which specific market data is provided. The purchase of any real estate data will be passed through. |
| &nbsp;&nbsp;**CYBERSECURITY CONTROLS** | &nbsp;&nbsp;There is a partial pass-through cost for requisite cybersecurity controls. These cybersecurity elements are necessary under an effective vendor management program. |
|  | &nbsp;&nbsp;There is a partial pass-through cost for requisite cybersecurity controls. These cybersecurity elements are necessary under an effective vendor management program. |
|  | &nbsp;&nbsp;There is a partial pass-through cost for requisite cybersecurity controls. These cybersecurity elements are necessary under an effective vendor management program. |

---

&nbsp;&nbsp;This SOW will expire 30 days from this date unless accepted by you in accordance with the terms set forth above and in the PSA. Any changes to this SOW will require approval of the Service Provider. Please sign and return a copy of this SOW to indicate acceptance.

---

| | | | |
|:---|:---|:---|:---|
| **ACCEPTED BY:** | FinPro, Inc. | **SIGNED BY:** | Mercer Savings Bank |
|  | 46 East Main Street, Suite 303 |  | 1100 Irmscher Boulevard |
|  | Somerville, NJ 08876 |  | Celina, OH 45822 |
| Signature: | /s/ Scott Martorana | Signature: | /s/ Alvin B. Parmiter |
| Print Name: | Scott Martorana | Print Name: | Alvin B. Parmiter |
| Title: | Executive Managing Director | Title: | CEO |
| Date: | 2/1/2023 | Date: | 2/1/2023 |

---

FinPro \| 46 East Main Street \| Suite 303 \| Somerville, NJ 08876 \| 908-234-9398 \| www.finpro.us

## Exhibit 99.2

**Exhibit 99.2**

![](tm238570d1_ex99-2img01.jpg)

Boards of Directors

March 7, 2023

Mercer Bancorp, Inc.

Mercer Savings Bank

1100 Irmscher Boulevard

Celina, OH 45822

Re:

Plan of Conversion Subscription Rights

Mercer Bancorp, Inc.

Members of the Boards of Directors:

The purpose of this letter is to provide an opinion of the value of the subscription rights of the "to be issued" common stock of Mercer Bancorp, Inc. (the "Corporation"), with regard to the stock offering of the Corporation.

Because the subscription rights to purchase shares of common stock in the Corporation, which are to be issued to certain depositors of Mercer Savings Bank and will be acquired by such recipients without cost, will be nontransferable and of short duration and will afford the recipients the right only to purchase shares of common stock at the same price as will be paid by members of the general public in a direct community offering, we are of the opinion that:

(1) The subscription rights will have no ascertainable fair market value, and;

(2) The price at which the subscription rights are exercisable will not be more or less than the fair market value of the shares on the date of the exercise.

Further, it is our opinion that the subscription rights will have no economic value on the date of distribution or at the time of exercise, whether or not a community offering takes place.

Sincerely,

FinPro Capital Advisors

![](tm238570d1_ex99-2img02.jpg)

**46 East Main Street • Suite 303 • Somerville, NJ 08876 • 908.234.9398 ● <u>www.finprocapitaladvisors.com</u>**

FinPro Capital Advisors, Inc. (Member FINRA/SIPC) is a wholly owned subsidiary of FinPro, Inc.

## Exhibit 99.3

**Exhibit 99.3**

![](tm238570d1_ex99-3img01.jpg)

Conversion Valuation Appraisal Report Page 1

**Table of Contents**

Mercer Savings Bank

---

| | | |
|:---|:---|:---|
| **Table of Contents** | **Table of Contents** | **1** |
| **Introduction** | **Introduction** | **3** |
| **1.** | **Overview and Financial Analysis** | **6** |
|  | **General Overview** | **6** |
|  | **History and overview** | **6** |
|  | **Strategic Direction** | **7** |
|  | **balance sheet trends** | **7** |
|  | **Loan Portfolio** | **11** |
|  | **investments** | **13** |
|  | **asset quality** | **15** |
|  | **Funding composition** | **16** |
|  | **Asset liability management** | **16** |
|  | **Capital** | **18** |
|  | **income and expense trends** | **18** |
|  | **Legal proceedings** | **21** |
|  | **subsidiaries** | **21** |
| **2.** | **Market Area Analysis** | **22** |
| **3.** | **Comparisons with Publicly Traded Thrifts** | **23** |
|  | **Overview of the Comparables** | **26** |
| **4.** | **Market Value Determination** | **28** |
|  | **Financial Condition** | **29** |
|  | **Balance Sheet Growth** | **34** |
|  | **Earnings Quality, Predictability and Growth** | **35** |
|  | **Market area** | **39** |
|  | **Cash Dividends** | **43** |
|  | **Recent Regulatory Matters** | **44** |
| **5.** | **Other Factors** | **45** |
|  | **Management** | **45** |
|  | **Liquidity of the shares** | **46** |
|  | **marketing of the issuance** | **47** |

---

Conversion Valuation Appraisal Report Page 2

---

| | | |
|:---|:---|:---|
|  | | **49** |
| **6.** | **Valuation Adjustments**<br>**Valuation** | **50** |
|  | **Discussion of Weight Given to Valuation Multiples** | **50** |
|  | **Offering Value in Relation to Comparables** | **53** |
|  | **Comparison to Recent Standard Conversions** | **55** |
|  | **Valuation Conclusion** | **56** |
| **7.** | **Exhibits** | **57** |

---

Conversion Valuation Appraisal Report Page 3

Introduction

February 28, 2023

Board of Directors

Mercer Savings Bank

1100 Irmscher Blvd.

Celina, OH 45822

Members of the Board Directors:

At your request, FinPro Capital Advisors, Inc. ("FinPro" or "FCA") has completed and hereby provides an independent appraisal ("Appraisal") of the estimated pro forma market value of the common stock which is to be issued in connection with the mutual-to-stock conversion transaction described below.

This Appraisal is furnished pursuant to the requirements stipulated in the Code of Federal Regulations and has been prepared in accordance with the "Guidelines for Appraisal Reports for the Valuation of Savings and Loan Associations Converting from Mutual to Stock Form of Organization" (the "Valuation Guidelines") of originally issued by the Office of Thrift Supervision ("OTS") and accepted by the Federal Reserve Board ("FRB"), the Office of the Comptroller of the Currency ("OCC"), the Federal Deposit Insurance Corporation ("FDIC"), The Ohio Division of Financial Institutions (the "ODFI") and other state banking regulatory agencies, and applicable regulatory interpretations thereof.

<u>Description of Plan of Conversion</u>

The Board of Directors of Mercer Savings Bank ("Mercer" or the "Bank") has adopted the plan of conversion (the "Plan"); whereby the Bank will convert to stock form. As a result of the conversion, the Bank will convert to the stock form of ownership and issue all of its common stock to a to-be-formed holding company called Mercer Bancorp, a newly formed Maryland corporation, ("the Company"). It is our understanding that the Bank will offer its stock in a subscription and community offering to Eligible Account Holders, to the Employee Plans and to Supplemental Eligible Account Holders of the Bank. To the extent that shares remain available for purchase after satisfaction of all subscriptions received in the subscription offering, the shares may be offered for sale to members of the general public in a direct community offering and/or a syndicated community offering. A portion of the net proceeds received from the sale of the common stock will be used to purchase all of the then to be issued and outstanding capital stock of Mercer and the balance of the net proceeds will be retained by the Company.

At this time, no other activities are contemplated for the Company other than the ownership of the Bank, a loan to the newly formed ESOP and reinvestment of the proceeds that are retained by the Bank. In the future, the Company may acquire or organize other operating subsidiaries, diversify into other banking-related activities, pay dividends, or repurchase its stock, although there are no specific plans to undertake such activities at the present time. The plan of conversion will provide for the establishment of a new charitable foundation (the "Foundation"). On a preliminary basis, the Foundation contribution is expected to consist of $100 thousand of cash and 50 thousand shares of Company common stock.

Conversion Valuation Appraisal Report Page 4

In compiling the pro formas, FinPro relied upon the assumptions provided by the Bank and its agents.

The pro forma assumptions are as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· 100.00%
 of the total shares will be sold to the depositors and public,

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the
 stock will be issued at $10.00 per share,

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the
 fixed conversion expenses will be $1.5 million at the midpoint,

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· placement
 agent fee greater of 1% of issuance or $250 thousand,

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· there
 will be an ESOP equal to 8.00% of the shares sold, funded internally, and amortized over
 15 years straight-line,

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· there
 will be an MRP equal to 4.00% of the shares sold, amortized over 5 years straight-line,

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· there
 will be a Stock Option Plan equal to 10% of the shares sold, expensed at $3.72 per option
 over 5 years straight-line,

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the
 tax rate is assumed at 21%, and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the
 net proceeds will be invested at the one-year treasury rate of 5.00%, pre-tax.

In the course of preparing our report, we reviewed the Bank's financials for the years ended December 31, 2022, and December 31, 2021. We also reviewed the registration statement as filed with the Securities and Exchange Commission ("SEC"). We have conducted due diligence analysis of the Bank and held due diligence related discussions with the Bank's Management and Board and Luse Gorman, PC (the Bank's counsel). The valuation parameters set forth in the appraisal were predicated on these discussions, but all conclusions related to the valuation were reached and made independent of such discussions.

Where appropriate, we considered information based upon other publicly available sources, which we believe to be reliable; however, we cannot guarantee the accuracy or completeness of such information. We reviewed the Bank's primary market area and reviewed the market area's economic condition. We also reviewed the competitive environment in which the Bank operates and its relative strengths and weaknesses. We compared the Bank's performance with selected publicly traded institutions. We reviewed conditions in the securities markets in general and in the market for similar institutions in particular. Our analysis included a review of the estimated effects of the Conversion of the Bank on the operations and expected financial performance as they related to the Bank's estimated pro forma value.

In preparing our valuation, we relied upon and assumed the accuracy and completeness of financial and other information provided to us by the Bank and its independent accountants. We did not independently verify the financial statements and other information provided by the Bank and its independent accountants, nor did we independently value any of the Bank's assets or liabilities. This estimated valuation considers the Bank only as a going concern and should not be considered as an indication of its liquidation value.

**Our valuation is not intended, and must not be construed, to be a recommendation of any kind as the advisability of purchasing shares of Common Stock in the stock issuance. Moreover, because such valuation is necessarily based upon estimates and projections of a number of matters, all of which are subject to change from time to time, no assurance can be given that persons who purchase shares of Common Stock in the stock issuance will thereafter be able to sell such shares at prices related to the foregoing valuation of the pro forma market value thereof. FinPro is not a seller of securities within the meaning of any federal or state securities laws. Any report prepared by FinPro shall not be used as an offer or solicitation with respect to the purchase or sale of any securities.**

Conversion Valuation Appraisal Report Page 5

The estimated valuation herein will be updated as appropriate. These updates will consider, among other factors, any developments or changes in the Bank's financial condition, operating performance, management policies and procedures and current conditions in the securities market for thrift institution common stock. Should any such developments or changes, in our opinion, be material to the estimated pro forma market value of the Bank, appropriate adjustments to the estimated pro forma market value will be made. The reasons for any such adjustments will be explained at that time.

<u>Valuation Conclusion</u>

It is, FinPro's opinion that as of February 23, 2023, the estimated aggregate pro forma market value of the Bank was $13,000,000 at the midpoint of a range (excluding foundation shares) with a minimum of $11,050,000 to a maximum of $14,950,000 at 15% below and 15% above the midpoint of the range respectively. Assuming an adjusted maximum value of 15% above the maximum value, the adjusted maximum value or super maximum value is $17,192,500. The stock will be issued at $10.00 per share.

<u>FinPro Capital Advisors</u>

FinPro Capital Advisors, Inc. ("FCA" or "FinPro") is a registered broker dealer and is a wholly owned subsidiary of FinPro, Inc. FCA addresses numerous areas of capital markets in the heavily regulated financial institution industry including M&A advisory, capital raising, strategic advice, valuation, due diligence, accounting, mark-to-market, enterprise risk management, business planning and regulatory advice. FCA further specializes in financial valuations and analyses of business enterprises and securities, including the pro forma valuation for savings institutions converting from mutual-to-stock form. We believe that, except for the fee we will receive for the Appraisal to assist in the stock conversion process, we are independent of the Bank, Mercer Savings Bank and the other parties engaged by Mercer Savings Bank.

Conversion Valuation Appraisal Report Page 6

1. Overview and Financial Analysis

**General Overview**

As of December 31, 2022, the Bank had $147.0 million in total assets, $128.5 million in deposits, $118.7 million in net loans and $14.5 million in equity. The following table shows the Bank's facilities.

**Figure– List of Branch Offices**

**US Branch List for Mercer SB**

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| | | | **2022** | **2021** | **2017** | **2021-2022** | **2017-2022** |
| <br>**Street Address** | <br>**City** | <br>**State** | **Deposits ($000)** | **Deposits ($000)** | **Deposits ($000)** | **Growth Rate (%)** | **Growth Rate (%)** |
| 1100 Irmscher Blvd | Celina | OH | 25281 | 26473 | 13988 | (4.50) | 80.73 |
| 120 N Wayne St | Fort Recovery | OH | 41144 | 32005 | 22898 | 28.55 | 79.68 |
| 125 E Main St | Greenville | OH | 27221 | 26820 | 20126 | 1.50 | 35.25 |
| 217 W Market St | Celina | OH | 45231 | 48183 | 44732 | (6.13) | 1.12 |

---

Source: S&P Global

**History And Overview**

Mercer Savings Bank is a bank. The company was founded in 1888 and is based in Celina, Ohio. Mercer Savings has been a trusted community bank for more than 130 years. The Bank offers the financial products and services that make their customers life easier and money work harder for them. Mercer Savings Bank is a community-first financial partner that shares the values of the customers it serves. The Bank understands the importance of hard work, doing the right thing, and supporting local endeavors.

The Bank considers its primary market area for loan originations and deposit gathering to be Mercer and Darke Counties in western Ohio and contiguous areas, including Adams and Jay Counties in eastern Indiana. The Bank conducts its operations from its main office in Celina, Ohio and three branch offices in Celina, Fort Recovery and Greenville, Ohio. In addition to the branch network, the Bank offers online and mobile banking.

The Bank's business consists primarily of taking deposits from the general public and investing those deposits, together with funds generated from operations and borrowings, in one- to four-family residential mortgage loans and agricultural real estate loans secured by properties located in the Bank's primary market area. To a lesser extent, the Bank also originates multifamily real estate loans, commercial real estate loans, construction and land loans, home equity lines of credit, commercial and industrial loans, and consumer loans, and purchase investment securities. The Bank offers a variety of deposit accounts including checking accounts, savings accounts, and certificates of deposit. The primary source of funding is core deposits. The Bank also utilize advances from the Federal Home Loan Bank of Cincinnati and brokered deposits for liquidity and asset/liability management purposes and may attempt to attract municipal deposits to a lesser extent.

Conversion Valuation Appraisal Report Page 7

**Strategic Direction**

The Bank's mission is to operate and further expand a profitable and diversified community banking franchise. It plans to achieve this by executing its strategy of:

&nbsp;&nbsp;&nbsp;&nbsp;· establishing
 a fifth branch office during 2024 in Adams or Jay County in eastern Indiana, where the Bank
 has active lending operations.

&nbsp;&nbsp;&nbsp;&nbsp;· continuing
 to transform its balance sheet to emphasize assets and liabilities that allow it to increase
 its net interest margin while reducing its exposure to risk from interest rate fluctuations.

**balance sheet trends**

The Bank's balance sheet decreased by $6.6 million, or -4.35%, from $152.8 million on September 30, 2022, to $146.2 million as of December 31, 2022.

The Bank's equity increased by $479 thousand, or 3.42%, from $14.0 million on September 30, 2022, to $14.5 million as of December 31, 2022.

**Figure– Balance Sheet Trends**

---

| | | | |
|:---|:---|:---|:---|
|  | | **At September 30,** | **At September 30,** |
|  | **At December 31,**<br>**2022** | **2022** | **2021** |
|  | **(In thousands)** | **(In thousands)** | **(In thousands)** |
| **Selected Financial Condition Data:** |  |  |  |
| Total assets | $146190 | $152883 | $147345 |
| Cash and cash equivalents | 7203 | 14377 | 18001 |
| Interest-bearing time deposits | 100 | 100 | 100 |
| Securities available for sale | 13321 | 12572 | 8585 |
| Securities held to maturity | 212 | 233 | 339 |
| Loans held for sale | 282 |  | 399 |
| Loans, net of allowance for loan losses | 117830 | 117671 | 112511 |
| Premises and equipment, net | 2603 | 2608 | 2416 |
| Federal Home Loan Bank stock | 1390 | 1390 | 1605 |
| Bank-owned life insurance | 1753 | 1742 | 2066 |
| Total deposits | 127699 | 134759 | 128245 |
| Federal Home Loan Bank advances | 3000 | 3000 | 4000 |
| Total equity | 14526 | 14056 | 14063 |

---

Source: Offering Prospectus

Conversion Valuation Appraisal Report Page 8

**Figure– Key Ratio Trends**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **At or For the**<br> **Three Months Ended**<br> **December 31,** | **At or For the**<br> **Three Months Ended**<br> **December 31,** | **At or For the**<br> **Year Ended**<br> **September 30,** | **At or For the**<br> **Year Ended**<br> **September 30,** |
|  | **2022** | **2021** | **2022** | **2021** |
| **Performance Ratios:** |  |  |  |  |
| Return on average assets (1) (2) | 0.88% | 0.48% | 0.62% | 0.39% |
| Return on average equity (1) (3) | 9.29% | 5.10% | 6.76% | 4.15% |
| Interest rate spread (4) | 3.68% | 2.84% | 2.92% | 2.84% |
| Net interest margin (1) (5) | 3.71% | 2.88% | 2.95% | 2.89% |
| Noninterest expense to average assets (1) | 2.84% | 2.61% | 2.60% | 2.60% |
| Efficiency ratio (6) | 72.35% | 80.02% | 77.33% | 81.04% |
| Average interest-earning assets to average interest-bearing liabilities | 122.74% | 118.91% | 120.53% | 119.31% |
| **Capital Ratios:** |  |  |  |  |
| Average equity to average assets | 9.49% | 9.39% | 9.17% | 9.37% |
| Total capital to risk-weighted assets | 16.80% | 16.60% | 16.60% | 16.40% |
| Tier 1 capital to risk-weighted assets | 15.80% | 15.50% | 15.60% | 15.30% |
| Common equity Tier 1 capital to risk-weighted assets | 15.80% | 15.50% | 15.60% | 15.30% |
| Tier 1 capital to average assets | 10.20% | 9.50% | 9.70% | 9.30% |
| **Asset Quality Ratios:** |  |  |  |  |
| Allowance for loan losses to total loans | 0.79% | 0.84% | 0.81% | 0.83% |
| Allowance for loan losses to non-performing loans | 222.45% | 926.67% | 281.14% | 449.77% |
| Allowance for loan losses to non-accrual loans | 222.45% | 1.09% | 281.14% | 449.77% |
| Net (charge-offs) recoveries to average outstanding loans | (0.02)% |  |  | (0.06)% |
| Non-accrual loans to total loans | 0.35% | 0.13% | 0.29% | 0.19% |
| Non-performing loans to total loans | 0.35% | 0.13% | 0.29% | 0.19% |
| Non-performing loans to total assets | 0.30% | 0.07% | 0.23% | 0.14% |
| Total non-performing assets to total assets | 0.30% | 0.07% | 0.23% | 0.14% |
| **Other:** |  |  |  |  |
| Number of offices | 4 | 4 | 4 | 4 |
| Number of full-time employees | 28 | 31 | 28 | 31 |
| Number of part-time employees | 2 | 3 | 3 | 3 |

---

(1) Annualized where appropriate.

(2) Represents net income divided by average total assets.

(3) Represents net income divided by average equity.

(4) Represents the difference between the weighted average yield on average interest-earning assets and the weighted average cost of average interest-bearing liabilities.

(5) Represents net interest income divided by average interest-earning assets.

(6) Represents noninterest expense divided by the sum of net interest and dividend income and noninterest income.

Conversion Valuation Appraisal Report Page 9

Source: Offering Prospectus

**Figure– Average Balances**

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | | **For the Three Months Ended December 31,** | **For the Three Months Ended December 31,** | **For the Three Months Ended December 31,** | **For the Three Months Ended December 31,** | **For the Three Months Ended December 31,** | **For the Three Months Ended December 31,** |
|  | **At**<br>**December 31. 2022** | **2022** | **2022** | **2022** | **2021** | **2021** | **2021** |
|  | **Weighted-<br> Average<br> Yield/Rate** | **Average <br> Outstanding<br> Balance** | **Interest** | **Average <br> Yield/Rate** | **Average <br> Outstanding <br> Balance** | **Interest** | **Average <br> Yield/Rate** |
|  | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** |
| **Interest-earning assets:** |  |  |  |  |  |  |  |
| Loans (1) | 4.09% | $118826 | $1222 | 4.11% | $114461 | $1072 | 3.75% |
| Taxable securities | 1.51% | 10366 | 41 | 1.58% | 7644 | 14 | 0.73% |
| Tax-exempt securities | 2.83% | 4047 | 25 | 2.47% | 1881 | 9 | 1.91% |
| Interest-earning deposits and other | 4.18% | 10834 | 106 | 3.91% | 19713 | 11 | 0.22% |
| &nbsp;&nbsp;&nbsp;&nbsp;Total interest-earning assets | 3.87% | 144073 | 1394 | 3.87% | 143699 | 1106 | 3.08% |
| Noninterest-earning assets |  | 6193 |  |  | 6883 |  |  |
| Allowance for loan losses |  | (972) |  |  | (965) |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Total assets |  | $149294 |  |  | $149617 |  |  |
| **Interest-bearing liabilities:** |  |  |  |  |  |  |  |
| Interest-bearing demand deposits | 0.05% | $44897 | 3 | 0.03% | $44408 | 4 | 0.04% |
| Savings deposits | 0.05% | 45272 | 8 | 0.07% | 42356 | 7 | 0.07% |
| Certificates of deposit | 0.78% | 24208 | 38 | 0.63% | 30078 | 53 | 0.70% |
| &nbsp;&nbsp;&nbsp;&nbsp;Total interest-bearing deposits | 0.20% | 114377 | 49 | 0.17% | 116842 | 64 | 0.22% |
| Federal Home Loan Bank advances | 0.95% | 3000 | 7 | 0.93% | 4000 | 9 | 0.90% |
| &nbsp;&nbsp;&nbsp;&nbsp;Total interest-bearing liabilities | 0.22% | 117377 | 56 | 0.19% | 120842 | 73 | 0.24% |
| Noninterest-bearing demand deposits |  | 16655 |  |  | 13453 |  |  |
| Other noninterest-bearing liabilities |  | 1094 |  |  | 1273 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Total liabilities |  | 135126 |  |  | 135568 |  |  |
| Equity |  | 14168 |  |  | 14049 |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Total liabilities and equity |  | $149294 |  |  | $149617 |  |  |
| Net interest income |  |  | $1338 |  |  | $1033 |  |
| Net interest rate spread (2) | 3.65% |  |  | 3.68% |  |  | 2.84% |
| Net interest-earning assets (3) |  | $26696 |  |  | $22857 |  |  |
| Net interest margin (4) |  |  |  | 3.71% |  |  | 2.88% |
| Average interest-earning assets to interest-bearing liabilities |  | 122.74% |  |  | 118.91% |  |  |

---

*(footnotes on following page)*

Conversion Valuation Appraisal Report Page 10

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | | **For the Year Ended September 30**,** | **For the Year Ended September 30**,** | **For the Year Ended September 30**,** | **For the Year Ended September 30**,** | **For the Year Ended September 30**,** | **For the Year Ended September 30**,** |
|  | **At**<br>**September 30. 2022** | **2022** | **2022** | **2022** | **2021** | **2021** | **2021** |
|  | **Weighted-<br> Average<br> Yield/Rate** | **Average<br> Outstanding<br> Balance** | **Interest** | **Average<br> Yield/Rate** | **Average <br> Outstanding<br> Balance** | **Interest** | **Average <br> Yield/Rate** |
|  | | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** |
| **Interest-earning assets:** |  |  |  |  |  |  |  |
| Loans (1) | 3.94% | $114595 | $4322 | 3.77% | $110023 | $4343 | 3.95% |
| Taxable securities | 1.50% | 9190 | 67 | 0.73% | 5762 | 60 | 1.04% |
| Tax-exempt securities | 2.22% | 2548 | 53 | 2.08% | 1072 | 22 | 2.05% |
| Interest-earning deposits and other | 3.06% | 20266 | 153 | 0.75% | 23429 | 36 | 0.15% |
| &nbsp;&nbsp;&nbsp;Total interest-earning assets | 3.64% | 146599 | 4595 | 3.13% | 140286 | 4461 | 3.18% |
| Noninterest-earning assets |  | 6514 |  |  | 7311 |  |  |
| Allowance for loan losses |  | (977) |  |  | (904) |  |  |
| &nbsp;&nbsp;&nbsp;Total assets |  | $152136 |  |  | $146693 |  |  |
| **Interest-bearing liabilities:** |  |  |  |  |  |  |  |
| Interest-bearing demand deposits | 0.05% | $45854 | 14 | 0.03% | $41916 | 15 | 0.04% |
| Savings deposits | 0.05% | 44129 | 30 | 0.07% | 38427 | 32 | 0.08% |
| Certificates of deposit | 0.68% | 28181 | 189 | 0.67% | 32774 | 316 | 0.96% |
| &nbsp;&nbsp;&nbsp;Total interest-bearing deposits | 0.20% | 118164 | 233 | 0.20% | 113117 | 363 | 0.32% |
| Federal Home Loan Bank advances | 0.95% | 3462 | 32 | 0.92% | 4462 | 39 | 0.87% |
| &nbsp;&nbsp;&nbsp;Total interest-bearing <br> liabilities | 0.22% | 121626 | 265 | 0.22% | 117579 | 402 | 0.34% |
| &nbsp;&nbsp;Noninterest-bearing demand <br>deposits |  | 15540 |  |  | 14105 |  |  |
| Other noninterest-bearing liabilities |  | 1014 |  |  | 1260 |  |  |
| &nbsp;&nbsp;&nbsp;Total liabilities |  | 138180 |  |  | 132944 |  |  |
| Equity |  | 13956 |  |  | 13749 |  |  |
| &nbsp;&nbsp;&nbsp;Total liabilities and equity |  | $152136 |  |  | $146693 |  |  |
| Net interest income |  |  | $4330 |  |  | $4059 |  |
| Net interest rate spread (2) | 3.42% |  |  | 2.92% |  |  | 2.84% |
| Net interest-earning assets (3) |  | $24973 |  |  | $22707 |  |  |
| Net interest margin (4) |  |  |  | 2.95% |  |  | 2.89% |
| Average interest-earning assets to interest-bearing liabilities |  | 120.53% |  |  | 119.31% |  |  |

---

(1) Net deferred fee income included in interest earned on loans totaled
 $18,000 and $31,000 for the three months ended December 31, 2022 and 2021, respectively,
 and $110,000 and $157,000 for the year ended September 30, 2022 and 2021, respectively.

(2) Net interest rate spread represents the difference between the weighted
 average yield on interest-earning assets and the weighted average rate of interest-bearing
 liabilities.

(3) Net interest-earning assets represent total interest-earning assets less
 total interest-bearing liabilities.

(4) Net interest
 margin represents net interest income divided by average total interest-earning assets.

Source: Offering Prospectus

Conversion Valuation Appraisal Report Page 11

**Loan Portfolio**

As of December 31, 2022, the Bank had $76.6 million of loans secured by one- to four-family residential real estate, representing 62.6% of total loans. As of December 31, 2022, the Bank had $31.0 million in agricultural real estate loans, representing 25.3% of total loans. As of December 31, 2022, the Bank had $4.2 million in construction and land loans, representing 3.5% of our total loan portfolio. Net loans increased by $160 thousand, or 0.1%, to $117.8 million as of December 31, 2022 from $117.7 million at September 30, 2022.

Additionally, in 2023, the Bank began implementing an indirect automobile lending program. The management team has experience with indirect automobile lending and the Bank intend to prudently grow that segment of our loan portfolio.

During the three months ended December 31, 2022, agricultural real estate loans increased $2.5 million, or 8.7%, to a total of $31.0 million at December 31, 2022 and construction and land loans increased $618,000, or 17.1%, to $4.2 million at December 31, 2022, while residential real estate loans decreased $1.7 million, or 2.2%, to $76.6 million at December 31, 2022, from $78.3 million at September 30, 2022. Changes in loan balances reflect the Bank's strategic focus on diversification of the loan portfolio amid strong competition loans in the Bank's market area.

Conversion Valuation Appraisal Report Page 12

**Figure – Loan Composition**

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  |  |  | **At September 30,** | **At September 30,** | **At September 30,** | **At September 30,** |
|  | **At December 31, 2022** | **At December 31, 2022** | **2022** | **2022** | **2021** | **2021** |
|  | **Amount** | **Percent** | **Amount** | **Percent** | **Amount** | **Percent** |
|  | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** |
| Real estate loans: |  |  |  |  |  |  |
| &nbsp;&nbsp;One- to four-family | $76582 | 62.6% | $78312 | 64.4% | $73808 | 64.2% |
| &nbsp;&nbsp;Multifamily | 1346 | 1.1 | 1356 | 1.1 | 1173 | 1 |
| &nbsp;&nbsp;Agricultural | 30987 | 25.3 | 28516 | 23.5 | 27290 | 23.7 |
| &nbsp;&nbsp;Commercial | 1780 | 1.5 | 1790 | 1.5 | 1792 | 1.6 |
| &nbsp;&nbsp;Construction and land | 4228 | 3.5 | 3610 | 3 | 3631 | 3.2 |
| &nbsp;&nbsp;Home equity lines of credit | 4716 | 3.9 | 5175 | 4.3 | 4220 | 3.7 |
| Commercial and industrial loans | 1767 | 1.4 | 1833 | 1.5 | 2170 | 1.9 |
| Consumer loans | 868 | 0.7 | 926 | 0.8 | 921 | 0.8 |
| &nbsp;&nbsp; Total | 122274 | 100.0% | 121518 | 100.0% | 115005 | 100.0% |
| Less: |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Undisbursed loans in process | 3151 |  | 2530 |  | 1202 |  |
| &nbsp;&nbsp;&nbsp;Net deferred loan fees | 332 |  | 334 |  | 334 |  |
| &nbsp;&nbsp;&nbsp;Allowance for loan losses | 961 |  | 984 |  | 958 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loans, net | $117830 |  | $117670 |  | $112511 |  |

---

Source: Offering Prospectus

Conversion Valuation Appraisal Report Page 13

**investments**

The Bank's investment portfolio generally consists of mortgage-backed securities, treasury securities and agency bonds. The Bank holds the vast majority of securities as available for sale.

Investment securities increased $728 thousand, or 5.7%, to $13.5 million at December 31, 2022, from $12.7 million at September 30, 2022. During the three-month period ended December 31, 2022, securities purchases of $1.3 million were partially offset by sales, calls, maturities and repayments of $700 thousand.

The average balance of investment securities increased $4.9 million to $11.7 million for the year ended September 30, 2022 from $6.8 million for the year ended September 30, 2021, while the average yield on investment securities decreased by 18 basis points to 1.02% for the year ended September 30, 2022 from 1.20% for the year ended September 30, 2021. Interest income on interest-earning deposits and other interest-earning assets, comprised primarily of certificates of deposit in other financial institutions, overnight deposits and stock in the Federal Home Loan Bank, increased $117,000, or 328.1%, for the year ended September 30, 2022 , due to an increase in the average yield of 60 basis points, to 0.75% for the year ended September 30, 2022 from 0.15% for the year ended September 30, 2021, partially offset by a decrease in the average balance of $3.2 million. The increase in average yield was due to the increase in interest rates in the overall economy during the periods.

Conversion Valuation Appraisal Report Page 14

**Figure– Investment Composition**

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **One Year or Less** | **One Year or Less** | **More than One Year to <br> Five Years** | **More than One Year to <br> Five Years** | **More than Five Years to <br> Ten Years** | **More than Five Years to <br> Ten Years** | **More than Ten Years** | **More than Ten Years** |
|  | **Amortized<br> Cost** | **Weighted<br> Average<br> Yield** | **Amortized<br> Cost** | **Weighted<br> Average<br> Yield** | **Amortized<br> Cost** | **Weighted<br> Average<br> Yield** | **Amortized<br> Cost** | **Weighted<br> Average<br> Yield** |
|  | (Dollars in thousands) | (Dollars in thousands) | (Dollars in thousands) | (Dollars in thousands) | (Dollars in thousands) | (Dollars in thousands) | (Dollars in thousands) | (Dollars in thousands) |
| **December 31, 2022** |  |  |  |  |  |  |  |  |
| **Held-to-maturity:** |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Mortgage-backed Government Sponsored Enterprises (GSEs) | $1 | 2.99% | $83 | 2.18% | $128 | 3.08% | $— | —% |
| &nbsp;&nbsp;&nbsp;**Available-for-sale:** |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;U.S. Treasury Securities | $1006 | 0.14% | $999 | 0.32% | $— | —% | $— | —% |
| &nbsp;&nbsp;&nbsp;U.S. Government Agencies | $1001 | 0.17% | $3021 | 1.92% | $— | —% | $— | —% |
| &nbsp;&nbsp;&nbsp;Mortgage-backed GSEs | $— | —% | $— | —% | $221 | 1.75% | $3812 | 1.92% |
| &nbsp;&nbsp;&nbsp;State and political subdivisions | $253 | 0.68% | $441 | 3.23% | $— | —% | $3533 | 3.66% |

---

Source: Offering Prospectus

Conversion Valuation Appraisal Report Page 15

**asset quality**

Over the past year the Bank has seen a decline in the allowance for loan losses to total loans, declining to 0.79% as of December 31, 2022. The Bank has strong coverage to both non-performing loans and non-accrual loans as measured by the allowance for loan losses. The Bank has further had no material charge offs since 2021. Please see the Key Ratio Trends table for further details.

**Figure– Non-Performing Asset Composition**

---

| | | | |
|:---|:---|:---|:---|
|  | | **At September 30,** | **At September 30,** |
|  | **At December 31,**<br>**2022** | **2022** | **2021** |
|  | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** |
| Non-accrual loans: |  |  |  |
| Real estate loans: |  |  |  |
| &nbsp;&nbsp;&nbsp;One- to four-family | $288 | $347 | $166 |
| &nbsp;&nbsp;&nbsp;Multifamily |  |  |  |
| &nbsp;&nbsp;&nbsp;Agricultural |  |  |  |
| &nbsp;&nbsp;&nbsp;Commercial |  |  |  |
| &nbsp;&nbsp;&nbsp;Construction and land |  |  |  |
| &nbsp;&nbsp;&nbsp;Home equity lines of credit | 144 |  | 28 |
| Commercial and industrial loans |  |  |  |
| Consumer loans | - | 3 | 19 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total non-performing loans | 432 | 350 | 213 |
| Total non-performing assets | $432 | $350 | $213 |
| Total non-performing loans to total loans | 0.35% | 0.29% | 0.19% |
| Total non- performing loans to total assets | 0.30% | 0.23% | 0.14% |
| Total non-performing assets to total assets | 0.30% | 0.23% | 0.14% |

---

Conversion Valuation Appraisal Report Page 16

**Funding composition**

Deposits decreased by $7.1 million, or 5.2%, to $127.7 million at December 31, 2022 from $134.8 million at September 30, 2022. Core deposits decreased $4.9 million, or 4.5%, to $104.6 million at December 31, 2022 from $109.5 million at September 30, 2022. Certificates of deposit decreased $2.2 million, or 8.6%, to $23.1 million at December 31, 2022 from $25.3 million at September 30, 2022. The decrease in certificates of deposit was primarily the result of an outflow of brokered deposits. The decrease in core deposits was due to migration to higher rate alternatives at investment brokerages, as well as normal seasonal declines in transactional accounts.

During the three months ended December 31, 2022, management continued its strategy of pursuing growth in demand accounts and other lower cost core deposits, in part by enhancing products and services offered and increased marketing. Management intends to continue its efforts to increase core deposits, with an emphasis on growth in consumer and business demand deposits, and may attempt to attract municipal deposits to a lesser extent.

At December 31, 2022, the Bank had $3.0 million of outstanding borrowings from the Federal Home Loan Bank of Cincinnati. At December 31, 2022, the Bank had the capacity to borrow $53.9 million from the Federal Home Loan Bank of Cincinnati. At December 31, 2022, September 30 2022 and 2021, the Bank had a cash management line of credit agreement with the FHLB providing for additional borrowing of $10 million.

**Asset liability management**

The following chart provides the Bank's estimated net portfolio value at various interest rate shock scenarios.

Conversion Valuation Appraisal Report Page 17

**Figure– EVE Results as of December 31, 2022**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **At December 31, 2022** | **At December 31, 2022** | **At December 31, 2022** | **At December 31, 2022** | **At December 31, 2022** | **At December 31, 2022** |
| | | | | **EVE as a Percentage of Present Value of**<br> **Assets <sup>(3)</sup>** | **EVE as a Percentage of Present Value of**<br> **Assets <sup>(3)</sup>** |
| | | **Estimated Increase (Decrease) in EVE** | **Estimated Increase (Decrease) in EVE** | | |
|<br>**Change in Interest** <br> **Rates (basis points)** <sup>(1)</sup>** |<br>**Estimated EVE**<br> **<sup>(2)</sup>** | **Amount** | **Percent** |<br>**EVE Ratio <sup>(4)</sup>** |<br>**Increase<br> (Decrease) (basis<br> points)** |
| **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** | **(Dollars in thousands)** |
| 300 | $32543 | $(10123) | (23.73)% | 23.33% | (726) |
| 200 | 36828 | (5838) | (13.68)% | 26.41% | (418) |
| 100 | 39812 | (2854) | (6.69)% | 28.55% | (204) |
|  | 42666 |  |  | 30.59% |  |
| (100) | 41828 | (838) | (1.96)% | 29.99% | (60) |
| (200) | 38606 | (4060) | (9.52)% | 27.68% | (291) |
| (300) | 32078 | (10588) | (24.82)% | 23.00% | (759) |

---

(1) Assumes an immediate uniform change in interest rates at all maturities.

(2) EVE is the discounted present value of expected cash flows from assets, liabilities and off-balance sheet contracts.

(3) Present value of assets represents the discounted present value of incoming cash flows on interest-earning assets.

(4) EVE Ratio represents EVE divided by the present value of assets.

Source: Offering Prospectus

Conversion Valuation Appraisal Report Page 18

**Figure– NII Results as of December 31, 2022**

---

| | | |
|:---|:---|:---|
| **At December 31, 2022** | **At December 31, 2022** | **At December 31, 2022** |
| **Change in Interest Rates <br> (basis points) <sup>(1)</sup>** | **NII Year 1 Forecast** | **Year 1 Change from Level** |
| | **(Dollars in thousands)** | |
| +300 | $5275 | (2.33)% |
| +200 | 5308 | (1.72)% |
| +100 | 5334 | (1.24)% |
| Level | 5401 |  |
| (100) | 5414 | 0.24% |
| (200) | 5630 | 4.24% |
| (300) | 5513 | 2.03% |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Assumes
 an immediate uniform change in interest rates at all maturities.

Source: Offering Prospectus

**Capital**

Total equity increased $469 thousand, or 3.3%, to $14.5 million at December 31, 2022 from $14.0 million at September 30, 2022. The increase resulted from net income of $329,000 during the three months ended December 31, 2022 and a $140 thousand increase in accumulated other comprehensive income.

**income and expense trends**

The Bank's net income has trended upward between the twelve months ended September 30, 2022 and September 30, 2021. The increase is predominately attributable to higher net interest income, which was a function of both higher interest income and lower interest expense. During this time frame net interest income rose from $4.5 million for the twelve months ended September 30, 2021 to $4.6 million for the twelve months ended September 30, 2022.

The net income for the three months ended December 31, 2022 was $150 thousand above the net income for the three months ended December 31, 2021. The growth in net income is attributable to a $305 thousand increase in net interest income. This growth is partially offset by the increase in noninterest expenses over the past year.

Conversion Valuation Appraisal Report Page 19

**Figure– Income Statement Trends**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **For the Three Months Ended <br>December 31,** | **For the Three Months Ended <br>December 31,** | **For the Year Ended <br>September 30,** | **For the Year Ended <br>September 30,** |
|  | **2022** | **2021** | **2022** | **2021** |
|  | **(In thousands)** | **(In thousands)** | **(In thousands)** | **(In thousands)** |
| **Selected Operating Data:** |  |  |  |  |
| Interest income | $1394 | $1106 | $4595 | $4461 |
| Interest expense | 56 | 73 | 265 | 402 |
| Net interest income | 1338 | 1033 | 4330 | 4059 |
| Provision for loan losses |  | 15 | 25 | 180 |
| Net interest income after provision for loan losses | 1338 | 1018 | 4305 | 3879 |
| Noninterest income | 127 | 188 | 795 | 656 |
| Noninterest expense | 1060 | 977 | 3963 | 3821 |
| Income before income taxes | 405 | 229 | 1137 | 714 |
| Income tax expense | 76 | 50 | 193 | 143 |
| Net income | $329 | $179 | $944 | $571 |

---

Source: Offering Prospectus

Conversion Valuation Appraisal Report Page 20

**Figure– Rate Volume Analysis**

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | **Three Months Ended<br> December 31, 2022 vs. 2021** | **Three Months Ended<br> December 31, 2022 vs. 2021** | **Three Months Ended<br> December 31, 2022 vs. 2021** | **Year Ended<br> September 30, 2022 vs. 2021** | **Year Ended<br> September 30, 2022 vs. 2021** | **Year Ended<br> September 30, 2022 vs. 2021** |
|  | **Increase (Decrease) Due to** | **Increase (Decrease) Due to** | | **Increase (Decrease) Due to** | **Increase (Decrease) Due to** | |
|  | **Volume** | **Rate** |<br>**Total Increase<br> (Decrease)** | **Volume** | **Rate** |<br>**Total Increase<br> (Decrease)** |
|  | **(In thousands)** | **(In thousands)** | **(In thousands)** | **(In thousands)** | **(In thousands)** | **(In thousands)** |
| **Interest-earning assets:** |  |  |  |  |  |  |
| Loans | $42 | $108 | $150 | $176 | $(197) | $(21) |
| Taxable securities | 6 | 21 | 27 | 29 | (22) | 7 |
| Tax exempt-securities | 12 | 4 | 16 | 30 | 1 | 31 |
| Interest-earning deposits and other | (3) | 98 | 95 | (6) | 123 | 117 |
| &nbsp;&nbsp;&nbsp;Total interest-earning assets | 57 | 231 | 288 | 229 | (95) | 134 |
| **Interest-bearing liabilities:** |  |  |  |  |  |  |
| Interest-bearing demand deposits |  | (1) | (1) | 1 | (2) | (1) |
| Savings deposits | 1 |  | 1 | 5 | (7) | (2) |
| Certificates of deposit | (9) | (6) | (15) | (40) | (87) | (127) |
| &nbsp;&nbsp;&nbsp;Total interest-bearing deposits | (8) | (7) | (15) | (34) | (96) | (130) |
| Federal Home Loan Bank Advances | (2) | - | (2) | (9) | 2 | (7) |
| &nbsp;&nbsp;&nbsp;Total interest-bearing liabilities | (10) | (7) | (17) | (43) | (94) | (137) |
| Change in net interest income | $67 | $238 | $305 | $272 | $(1) | $271 |

---

Source: Offering Prospectus

Conversion Valuation Appraisal Report Page 21

**Legal proceedings**

As of December 31, 2022, the Bank was not party to any pending legal proceedings that management believes would have a material adverse effect on the Bank's financial condition, results of operations or cash flows.

**subsidiaries**

The Bank does not have any subsidiaries.

Conversion Valuation Appraisal Report Page 22

2. Market Area Analysis

The following tables provide deposit and demographic data for the counties in which the Bank has branches.

**Figure– Deposit Market Share**

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| **Mercer Savings Bank \| Deposit Market Share** | **Mercer Savings Bank \| Deposit Market Share** | **Mercer Savings Bank \| Deposit Market Share** | **Mercer Savings Bank \| Deposit Market Share** | **Mercer Savings Bank \| Deposit Market Share** | **Mercer Savings Bank \| Deposit Market Share** | **Mercer Savings Bank \| Deposit Market Share** | **Mercer Savings Bank \| Deposit Market Share** |
| **Market Share Data\*** | **Market Share Data\*** | **Market Share Data\*** | **Market Share Data\*** | **Market Share Data\*** | **Market Share Data\*** | **Market Share Data\*** | **Market Share Data\*** |
|  |  |  | **2022** | **2022** | **2021** | **2021** | **2021** |
| **Institution (ST)** | **2022<br> Rank** | **2021<br> Rank** | **Number <br> of<br> Branches** | **Total <br> Deposits In <br> Market ($000)** | **Total <br> Market <br> Share (%)** | **Total Deposits <br> In Market <br> ($000)** | **Total <br> Market <br> Share (%)** |
| **Mercer, OH** |  |  |  |  |  |  |  |
| Peoples Holding Co. (OH) | 1 | 1 | 6 | 580320 | 34.36 | 545822 | 33.51 |
| St Henry Bancorp Inc (OH) | 2 | 3 | 3 | 350665 | 20.76 | 308909 | 18.96 |
| First Financial Bancorp. (OH) | 3 | 2 | 3 | 344841 | 20.42 | 352725 | 21.65 |
| **Mercer SB (OH)** | **4** | **5** | **3** | **111656** | **6.61** | **106661** | **6.55** |
| Park National Corp. (OH) | 5 | 4 | 2 | 106749 | 6.32 | 121622 | 7.47 |
| Citizens Bancshares Inc. (OH) | 6 | 6 | 1 | 83234 | 4.93 | 86817 | 5.33 |
| OSB Bancorp Inc. (OH) | 7 | 7 | 1 | 57299 | 3.39 | 55047 | 3.38 |
| JPMorgan Chase & Co. (NY) | 8 | 8 | 1 | 52066 | 3.08 | 49195 | 3.02 |
| Woodforest Financial Group (TX) | 9 | 9 | 1 | 2018 | 0.12 | 2073 | 0.13 |
| **Total For Institutions In Market** |  |  | **21** | **1688848** |  | **1628871** |  |
| **Darke, OH** |  |  |  |  |  |  |  |
| Greenville National Bancorp (OH) | 1 | 1 | 7 | 463342 | 28.67 | 437034 | 28.63 |
| Park National Corp. (OH) | 2 | 2 | 5 | 350225 | 21.67 | 314358 | 20.59 |
| Greenville Fed Finl Corp (OH) | 3 | 3 | 2 | 174441 | 10.79 | 172769 | 11.32 |
| OSB Bancorp Inc. (OH) | 4 | 4 | 2 | 154748 | 9.58 | 146086 | 9.57 |
| FSB Financial Corp (OH) | 5 | 5 | 3 | 137166 | 8.49 | 125510 | 8.22 |
| JPMorgan Chase & Co. (NY) | 6 | 6 | 1 | 73648 | 4.56 | 70953 | 4.65 |
| Fifth Third Bancorp (OH) | 7 | 7 | 1 | 61259 | 3.79 | 67419 | 4.42 |
| First Financial Bancorp. (OH) | 8 | 8 | 1 | 60070 | 3.72 | 56793 | 3.72 |
| U.S. Bancorp (MN) | 9 | 9 | 1 | 54772 | 3.39 | 53810 | 3.53 |
| Versailles Financial Corp (OH) | 10 | 10 | 1 | 51279 | 3.17 | 47089 | 3.08 |
| **Mercer SB (OH)** | **11** | **11** | **1** | **27221** | **1.68** | **26820** | **1.76** |
| **Total For Institutions In Market** |  |  | **26** | **1616097** |  | **1526436** |  |

---

\*The market share data displayed is for Mercer Savings Bank

Source: S&P Global

Conversion Valuation Appraisal Report Page 23

**Figure– County Demographics**

---

| | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| Mercer Savings Bank \| Market Demographics (Mercer Savings Bank) | Mercer Savings Bank \| Market Demographics (Mercer Savings Bank) | Mercer Savings Bank \| Market Demographics (Mercer Savings Bank) | Mercer Savings Bank \| Market Demographics (Mercer Savings Bank) | Mercer Savings Bank \| Market Demographics (Mercer Savings Bank) | Mercer Savings Bank \| Market Demographics (Mercer Savings Bank) | Mercer Savings Bank \| Market Demographics (Mercer Savings Bank) | Mercer Savings Bank \| Market Demographics (Mercer Savings Bank) | Mercer Savings Bank \| Market Demographics (Mercer Savings Bank) | Mercer Savings Bank \| Market Demographics (Mercer Savings Bank) | Mercer Savings Bank \| Market Demographics (Mercer Savings Bank) | Mercer Savings Bank \| Market Demographics (Mercer Savings Bank) |
|  |  |  |  |  | **Percent of** | **Percent of** | **2023** | **2010-2023** | **2023-2028** | **2023** | **2023-2028** |
| **County** | **Market <br> Rank** | **Number <br> of <br> Branches** | **Deposits<br> In Market<br> ($000)** | **Deposit <br> Market <br> Share (%)** | **State <br> Franchise<br> (%)** | **National <br> Franchise<br> (%)** | **Total <br> Population<br> (Actual)** | **Population <br> Change (%)** | **Projected <br> Population <br> Change (%)** | **Median<br> Household<br> Income ($)** | **Projected HH<br> Income Change<br> (%)** |
| **Ohio (OH)** |  |  |  |  |  |  |  |  |  |  |  |
| Mercer | 4 | 3 | 111656 | 6.61 | 80.40 | 80.40 | 42451 | 4.01 | 0.64 | 76032 | 11.60 |
| Darke | 11 | 1 | 27221 | 1.68 | 19.60 | 19.60 | 51332 | (3.07) | (1.01) | 64462 | 9.95 |
| **OH Totals** |  | **4** | **138877** |  | **100.00** | **100.00** | **93783** |  |  |  |  |
| **Weighted Average: Ohio Franchise** |  |  |  |  |  |  |  | **2.62** | **0.32** | **73764** | **11.27** |

---

Source: S&P Global

3. Comparisons with Publicly Traded Thrifts

INTRODUCTION

This section presents an analysis of the Bank's operations against a selected group ("Comparable Group") of publicly traded, fully converted thrifts. The Comparable Group was selected based upon similarity of characteristics to the Bank. The Comparable Group multiples provide the basis for the valuation of the Bank.

Factors that influence the Bank's value such as balance sheet structure and size, profitability, income and expense trends, capital levels, credit risk, and recent operating results can be measured against the Comparable Group. The Comparable Group's current market pricing, coupled with the appropriate aggregate adjustment for differences between the Bank and the Comparable Group, will then be utilized as the basis for the pro forma valuation of the Bank's to-be-issued common stock.

SELECTION CRITERIA

The goal of the selection criteria process is to find those institutions with characteristics that most closely match those of the Bank. In an ideal world, all of the Comparable Group would contain the exact characteristics of the Bank. However, none of the Comparables selected will be exact clones of the Bank.

The Peer Group selection process is governed by the general parameters set forth in the regulatory valuation guidelines. Accordingly, the Peer Group is comprised of only those publicly traded savings institutions whose common stock is either listed on the NYSE or NASDAQ, since their stock trading activity is regularly reported and generally more frequent than non-publicly traded and closely-held institutions. Institutions that are not listed on the NYSE or NASDAQ are inappropriate, since the trading activity for thinly-traded or closely-held stocks are typically highly irregular in terms of frequency and price and thus may not be a reliable indicator of market value. We have also excluded from the Peer Group those companies under acquisition or merger of equals.

Ideally, the Peer Group, which must have at least 10 members to comply with the regulatory valuation guidelines, should be comprised of locally- or regionally-based institutions with comparable resources, strategies and financial characteristics. There are approximately 38 publicly-traded savings institutions nationally and, thus, it is typically the case that the Peer Group will be comprised of institutions with relatively comparable characteristics. To the extent that differences exist between the converting institution and the Peer Group, valuation adjustments will be applied to account for the differences.

Conversion Valuation Appraisal Report Page 24

Since Mercer will be a full public company upon completion of the offering, we considered only full public companies to be viable candidates for inclusion in the Peer Group. From the universe of publicly-traded thrifts, we selected ten institutions with characteristics similar to those of Mercer. In the selection process, we applied the following "screen" to the universe of all public companies that were eligible for consideration:

Next in the screening process, FinPro selected all fully converted thrifts located in the Midwest, Northeast and Mid-Atlantic Regions. This resulted in 26 organizations.

FinPro excluded institutions that have recently converted, as the earnings of newly converted institutions do not reflect a full year's benefit from the reinvestment of proceeds, and thus the price/earnings multiples and return on equity measures for these institutions tend to be skewed upward and downward, respectively. As such, one institution was excluded that converted after January 1, 2022, was eliminated.

Of the remaining 25, FinPro then eliminated 13 of the institutions with assets in excess of $2.25 billion as these entities have greater financial and managerial resources and a broader branch network.

FinPro eliminated one minority focused institution.

This results in a total of 12 Comparables. FinPro reviewed the recent performance and news releases of these companies and determined that all eleven were acceptable Comparables.

**Figure– Comparable Group**

**<u>Corporate</u>**

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| **Company Name** | **Ticker** | **Exchange** | **IPO Date** | **Number of<br> Offices** | **City** | **State** |
| 1895 Bancorp of Wisconsin, Inc. (NASDAQCM:BCOW) | BCOW | NASDAQCM | 1/8/2019 | 6 | Greenfield | WI |
| Blue Foundry Bancorp (NASDAQGS:BLFY) | BLFY | NASDAQGS | 7/15/2021 | 20 | Rutherford | NJ |
| Finward Bancorp (NASDAQCM:FNWD) | FNWD | NASDAQCM |  | 30 | Munster | IN |
| First Seacoast Bancorp, Inc. (NASDAQCM:FSEA) | FSEA | NASDAQCM | 7/16/2019 | 5 | Dover | NH |
| Generations Bancorp NY, Inc. (NASDAQCM:GBNY) | GBNY | NASDAQCM | 7/10/2006 | 10 | Seneca Falls | NY |
| HMN Financial, Inc. (NASDAQGM:HMNF) | HMNF | NASDAQGM | 6/30/1994 | 14 | Rochester | MN |
| Mid-Southern Bancorp, Inc. (NASDAQCM:MSVB) | MSVB | NASDAQCM | 4/8/1998 | 3 | Salem | IN |
| Northeast Community Bancorp, Inc. (NASDAQCM:NECB) | NECB | NASDAQCM | 7/5/2006 | 12 | White Plains | NY |
| PB Bankshares, Inc. (NASDAQCM:PBBK) | PBBK | NASDAQCM | 7/14/2021 | 4 | Coatesville | PA |
| Provident Bancorp, Inc. (NASDAQCM:PVBC) | PVBC | NASDAQCM | 7/15/2015 | 7 | Amesbury | MA |
| Waterstone Financial, Inc. (NASDAQGS:WSBF) | WSBF | NASDAQGS | 10/4/2005 | 16 | Wauwatosa | WI |
| William Penn Bancorporation (NASDAQCM:WMPN) | WMPN | NASDAQCM | 4/15/2008 | 13 | Bristol | PA |
| 25% Percentile: |  |  |  | 6 |  |  |
| **Median:** |  |  |  | **11** |  |  |
| 75% Percentile: |  |  |  | 15 |  |  |

---

Source: S&P Global

List below provides a list of the institutions that were eliminated and included by the Comparable screens.

Conversion Valuation Appraisal Report Page 25

**Figure– List of all Publicly-traded Savings Institutions**

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| Entity Name | Exchange | Merger<br> Target or<br> MOE<br> Participant? | U.S.<br> Region | Total Assets<br> (Reported) | Total Assets<br> (Reported) | Industry<br> Classification | IPO Date<br> MM/dd/yyyy | Reason eliminated |
|  |  |  |  | FQ42022 | FQ32022 |  |  |  |
| 1895 Bancorp of Wisconsin, Inc. (NASDAQCM:BCOW) | NASDAQCM | No | MW | NA | 529317 | Savings Institutions | 01/08/2019 | In Comperable Group |
| Axos Financial, Inc. (NYSE:AX) | NYSE | No | WE | 17401165 | 16080950 | Savings Institutions | 03/14/2005 | Out of region |
| Blue Foundry Bancorp (NASDAQGS:BLFY) | NASDAQGS | No | MA | 2043338 | 2011918 | Savings Institutions | 07/15/2021 | In Comperable Group |
| Broadway Financial Corporation (NASDAQCM:BYFC) | NASDAQCM | No | WE | 1184293 | 1169634 | Savings Institutions | 01/08/1996 | Out of region |
| Capitol Federal Financial, Inc. (NASDAQGS:CFFN) | NASDAQGS | No | MW | 9624897 | 9476053 | Savings Institutions | 03/31/1999 | Asset Size |
| Carver Bancorp, Inc. (NASDAQCM:CARV) | NASDAQCM | No | MA | 735314 | 722810 | Savings Institutions | 10/24/1994 | Minority Focus |
| Cullman Bancorp, Inc. (NASDAQCM:CULL) | NASDAQCM | No | SE | NA | 406081 | Savings Institutions | 10/08/2009 | Out of region |
| Finward Bancorp (NASDAQCM:FNWD) | NASDAQCM | No | MW | 2070339 | 2052986 | Savings Institutions |  | In Comperable Group |
| First Northwest Bancorp (NASDAQGM:FNWB) | NASDAQGM | No | WE | 2042070 | 2091441 | Savings Institutions | 01/29/2015 | Out of region |
| First Seacoast Bancorp, Inc. (NASDAQCM:FSEA) | NASDAQCM | No | NE | NA | 523801 | Savings Institutions | 07/16/2019 | In Comperable Group |
| FS Bancorp, Inc. (NASDAQCM:FSBW) | NASDAQCM | No | WE | 2632898 | 2652138 | Savings Institutions | 07/09/2012 | Out of region |
| Generations Bancorp NY, Inc. (NASDAQCM:GBNY) | NASDAQCM | No | MA | NA | 373612 | Savings Institutions | 07/10/2006 | In Comperable Group |
| Hingham Institution for Savings (NASDAQGM:HIFS) | NASDAQGM | No | NE | 4193799 | 4062114 | Savings Institutions | 12/13/1988 | Asset Size |
| HMN Financial, Inc. (NASDAQGM:HMNF) | NASDAQGM | No | MW | 1096202 | 1047793 | Savings Institutions | 06/30/1994 | In Comperable Group |
| Home Federal Bancorp, Inc. of Louisiana (NASDAQCM:HFBL) | NASDAQCM | No | SW | 590480 | 574597 | Savings Institutions | 01/18/2005 | Out of region |
| Kearny Financial Corp. (NASDAQGS:KRNY) | NASDAQGS | No | MA | 7719883 | 7389891 | Savings Institutions | 02/23/2005 | Asset Size |
| Mid-Southern Bancorp, Inc. (NASDAQCM:MSVB) | NASDAQCM | No | MW | 269218 | 264548 | Savings Institutions | 04/08/1998 | In Comperable Group |
| New York Community Bancorp, Inc. (NYSE:NYCB) | NYSE | No | MA | 90144000 | 62956000 | Savings Institutions | 11/23/1993 | Asset Size |
| Northeast Community Bancorp, Inc. (NASDAQCM:NECB) | NASDAQCM | No | MA | 1425037 | 1284905 | Savings Institutions | 07/05/2006 | In Comperable Group |
| Northfield Bancorp, Inc. (Staten Island, NY) (NASDAQGS:NFBK) | NASDAQGS | No | MA | 5601293 | 5669595 | Savings Institutions | 11/07/2007 | Asset Size |
| NSTS Bancorp, Inc. (NASDAQCM:NSTS) | NASDAQCM | No | MW | NA | 268178 | Savings Institutions | 01/18/2022 | Recent Conversion |
| OP Bancorp (NASDAQGM:OPBK) | NASDAQGM | No | WE | 2094293 | 2029575 | Savings Institutions | 03/27/2018 | Out of region |
| PB Bankshares, Inc. (NASDAQCM:PBBK) | NASDAQCM | No | MA | NA | 376739 | Savings Institutions | 07/14/2021 | In Comperable Group |
| Ponce Financial Group, Inc. (NASDAQGM:PDLB) | NASDAQGM | No | MA | 2311989 | 2192402 | Savings Institutions | 09/29/2017 | Asset Size |
| Provident Bancorp, Inc. (NASDAQCM:PVBC) | NASDAQCM | No | NE | 1636381 | 1773684 | Savings Institutions | 07/15/2015 | In Comperable Group |
| Provident Financial Services, Inc. (NYSE:PFS) | NYSE | No | MA | 13783436 | 13603846 | Savings Institutions | 01/15/2003 | Asset Size |
| Riverview Bancorp, Inc. (NASDAQGS:RVSB) | NASDAQGS | No | WE | 1740096 | 1683076 | Savings Institutions | 10/26/1993 | Out of region |
| Southern Missouri Bancorp, Inc. (NASDAQGM:SMBC) | NASDAQGM | No | MW | 3214782 | 3264018 | Savings Institutions | 04/13/1994 | Asset Size |
| Sterling Bancorp, Inc. (Southfield, MI) (NASDAQCM:SBT) | NASDAQCM | No | MW | 2444735 | 2447904 | Savings Institutions | 11/16/2017 | Asset Size |
| TC Bancshares, Inc. (NASDAQCM:TCBC) | NASDAQCM | No | SE | NA | 406223 | Savings Institutions | 07/20/2021 | Out of region |
| Territorial Bancorp Inc. (NASDAQGS:TBNK) | NASDAQGS | No | WE | 2168754 | 2164823 | Savings Institutions | 07/10/2009 | Out of region |
| Third Coast Bancshares, Inc. (NASDAQGS:TCBX) | NASDAQGS | No | SW | 3773148 | 3516845 | Savings Institutions | 11/08/2021 | Out of region |
| Timberland Bancorp, Inc. (NASDAQGM:TSBK) | NASDAQGM | No | WE | 1860508 | 1887795 | Savings Institutions | 01/12/1998 | Out of region |
| TrustCo Bank Corp NY (NASDAQGS:TRST) | NASDAQGS | No | MA | 6000052 | 6079494 | Savings Institutions |  | Asset Size |
| Waterstone Financial, Inc. (NASDAQGS:WSBF) | NASDAQGS | No | MW | 2031672 | 1975051 | Savings Institutions | 10/04/2005 | In Comperable Group |
| Western New England Bancorp, Inc. (NASDAQGS:WNEB) | NASDAQGS | No | NE | 2553150 | 2578825 | Savings Institutions | 12/27/2001 | Asset Size |
| William Penn Bancorporation (NASDAQCM:WMPN) | NASDAQCM | No | MA | 879952 | 868981 | Savings Institutions | 04/15/2008 | In Comperable Group |
| WSFS Financial Corporation (NASDAQGS:WSFS) | NASDAQGS | No | MA | 19914755 | 19985387 | Savings Institutions | 11/26/1986 | Asset Size |

---

Source: S&P Global

Conversion Valuation Appraisal Report Page 26

**Overview of the Comparables**

The members of the Comparable Group were reviewed against the Bank to ensure comparability based upon the following criteria:

1. Asset size

2. Profitability

3. Capital Level

4. Balance Sheet Mix

5. Operating Strategy

6. Date of conversion

&nbsp;&nbsp;&nbsp;&nbsp;1. Asset Size: The Comparable Group should
 have a similar asset size to the Bank. The Comparable Group ranged in size from $264.5 million
 to $2.1 billion in total assets with a median of $983.6 million. The Bank's asset size
 was $147.0 million as of December 31, 2022. On a pro forma basis, the Bank's assets
 are projected to grow to approximately $157.7 million at the midpoint of the estimated value
 range. Due to the smaller size Mercer Savings Bank, there is a lack of similar size peers
 to be able to compare to.

&nbsp;&nbsp;&nbsp;&nbsp;2. Profitability: The Comparable Group
 had a median ROAA of 0.44% and a median ROAE of 3.20% for the last twelve months. The Comparable
 Group profitability measures had a dispersion about the mean for the ROAA measure ranging
 from a low of (1.24)% to a high of 1.95%, while the ROAE measure ranged from a low of (9.26)%
 to a high of 10.47%. The Bank had a ROAA of 0.73% and a ROAE of 8.0% for the twelve months
 ended December 31, 2022.

&nbsp;&nbsp;&nbsp;&nbsp;3. Capital Level: The Comparable Group
 had a median equity to assets ratio of 12.26% with a high of 20.58% and a low of 6.59%. On
 December 31, 2022, the Bank had an equity to assets ratio of 9.85%. The increase in
 the Bank's pro forma equity ratio will be favorable from a risk perspective and in
 terms of future earnings potential that could be realized through leverage. At the same time,
 the Bank's higher pro forma equity ratio will depress return on equity. Both the Bank's
 pro forma equity and the Peer Group's equity ratios reflected surpluses with respect to the
 regulatory capital requirements. On a pro forma basis, the Bank's regulatory surpluses
 will be higher than the Peer Group figures after the conversion.

&nbsp;&nbsp;&nbsp;&nbsp;4. Balance Sheet Mix: At December 31,
 2022, the Bank had a net loan to asset ratio of 81.57%. The median loan to asset ratio for
 the Comparables was 74.94%, ranging from a low of 56.89% to a high of 88.25%. On the liability
 side, the Bank's deposit to asset ratio was 87.45% at December 31, 2022 while
 the Comparable median was 76.58%, ranging from 59.02% to 89.58%. The Bank's borrowing
 to asset ratio of 2.04% is below the Comparable median of 9.39%.

&nbsp;&nbsp;&nbsp;&nbsp;5. Operating Strategy: An institution's
 operating characteristics are important because they determine future performance. Operational
 strategy also affects expected rates of return and investors' general perception of
 the quality, risk and attractiveness of a given company. Specific operating characteristics
 include profitability, balance sheet growth, asset quality, capitalization and non-financial
 factors such as management strategies and lines of business.

Conversion Valuation Appraisal Report Page 27

&nbsp;&nbsp;&nbsp;&nbsp;6. Date of Conversion Recent conversions,
 those completed on or after January 1, 2022, were excluded since the earnings of a newly
 converted institution do not reflect the reinvestment of conversion proceeds. Additionally,
 new issues tend to trade at a discount to the market averages.

Based on the above analysis, FinPro concluded that the Peer Group forms a reasonable basis for determining the pro forma market value of the Bank. Such general characteristics as asset size, capital position, interest-earning asset composition, funding composition, core earnings measures, loan composition, credit quality and exposure to interest rate risk all tend to support the reasonability of the Peer Group from a financial standpoint. Those areas where differences exist will be addressed in the form of valuation adjustments to the extent necessary.

Conversion Valuation Appraisal Report Page 28

Conversion Valuation Appraisal Report

4. Market Value Determination

MARKET VALUE ADJUSTMENTS

The estimated pro forma market value of the Bank, along with certain adjustments to its value relative to market values for the Comparable Group are delineated in this section. The adjustments are made from potential investors' viewpoint and are adjustments necessary when comparing the Bank to the Comparable Group. The adjustment factors are subjectively weighed using the appraiser's knowledge and expertise and an aggregate adjustment is determined. Potential investors include depositors holding subscription rights and unrelated parties who may purchase stock in the community offering and who are assumed to be aware of all relevant and necessary facts as they pertain to the value of the Bank relative to other publicly traded thrift institutions and relative to alternative investment opportunities.

There are numerous criteria on which the market value adjustments are based. The major criteria utilized for purposes of this report include:

Adjustments Relative to the Comparable Group:

&nbsp;&nbsp;&nbsp;&nbsp;· Financial
 Condition

&nbsp;&nbsp;&nbsp;&nbsp;· Balance
 Sheet Growth

&nbsp;&nbsp;&nbsp;&nbsp;· Earnings
 Quality, Predictability and Growth

&nbsp;&nbsp;&nbsp;&nbsp;· Market
 Area

&nbsp;&nbsp;&nbsp;&nbsp;· Cash
 Dividends

&nbsp;&nbsp;&nbsp;&nbsp;· Liquidity
 of the Issue

&nbsp;&nbsp;&nbsp;&nbsp;· Recent
 Regulatory Matters

Adjustments for Other Factors:

&nbsp;&nbsp;&nbsp;&nbsp;· Management

&nbsp;&nbsp;&nbsp;&nbsp;· Subscription
 Interest

To ascertain the market value of the Bank, the median trading multiple values for the Comparable Group are utilized as the starting point. The adjustment, up or down, to the Comparable Group median multiple values is made based on the comparison of the Bank to the Comparable Group.

Conversion Valuation Appraisal Report Page 29

**Financial Condition**

The balance sheet strength of an institution is an important market value determinant, as the investment community considers such factors as cash liquidity, capitalization, asset composition, funding mix, intangible levels and interest rate risk in assessing the attractiveness of investing in the common stock of a thrift. The following figures summarize the key financial elements of the Bank measured against the Comparable Group.

**Figure– Key Balance Sheet Data**

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **Balance Sheet Composition & Liquidity** | **Balance Sheet Composition & Liquidity** | **Balance Sheet Composition & Liquidity** | **Balance Sheet Composition & Liquidity** | **Balance Sheet Composition & Liquidity** | **Balance Sheet Composition & Liquidity** |
| <br>**Company Name** | **Total Assets**<br>**($000s)** | **Gross Loans<br> HFI/ Total<br> Assets**<br>**(%)** | **Deposits/<br> Assets**<br>**(%)** | **Gross Loans<br> HFI/ Deposits**<br>**(%)** | **Debt and<br> Borrowings/<br> Assets**<br>**(%)** | **Nonint.<br> Bearing<br> Deposits/<br> Total<br> Deposits**<br>**(%)** |
| 1895 Bancorp of Wisconsin, Inc. (NASDAQCM:BCOW) | 529317 | 67.62 | 71.66 | 94.36 | 10.76 | 28.81 |
| Blue Foundry Bancorp (NASDAQGS:BLFY) | 2043338 | 75.62 | 63.08 | 119.88 | 16.53 | 34.82 |
| Finward Bancorp (NASDAQCM:FNWD) | 2070339 | 73.11 | 85.74 | 85.27 | 6.54 | 20.23 |
| First Seacoast Bancorp, Inc. (NASDAQCM:FSEA) | 523801 | 75.56 | 73.84 | 102.33 | 15.87 | 23.14 |
| Generations Bancorp NY, Inc. (NASDAQCM:GBNY) | 373612 | 78.69 | 82.52 | 95.35 | 6.45 | 18.71 |
| HMN Financial, Inc. (NASDAQGM:HMNF) | 1096202 | 71.83 | 89.58 | 80.18 |  | NA |
| Mid-Southern Bancorp, Inc. (NASDAQCM:MSVB) | 264548 | 54.48 | 76.29 | 71.41 | 11.72 | 13.66 |
| Northeast Community Bancorp, Inc. (NASDAQCM:NECB) | 1425037 | 85.45 | 78.73 | 108.53 | 1.68 | 33.54 |
| PB Bankshares, Inc. (NASDAQCM:PBBK) | 376739 | 81.00 | 76.88 | 105.37 | 10.78 | 8.23 |
| Provident Bancorp, Inc. (NASDAQCM:PVBC) | 1636381 | 88.25 | 78.20 | 112.86 | 8.01 | 40.66 |
| Waterstone Financial, Inc. (NASDAQGS:WSBF) | 2031672 | 74.33 | 59.02 | 125.95 | 19.04 | NA |
| William Penn Bancorporation (NASDAQCM:WMPN) | 870944 | 56.89 | 70.66 | 80.51 | 7.86 | 10.83 |
| 25% Percentile: | 487036 | 70.77 | 71.41 | 84.08 | 6.52 | 14.92 |
| **Median:** | **983573** | **74.94** | **76.58** | **98.84** | **9.39** | **21.68** |
| 75% Percentile: | 1735204 | 79.26 | 79.68 | 109.61 | 12.76 | 32.36 |
| **Mercer Savings Bank** | **146987** | **81.57** | **87.45** | **93.28** | **2.04** | **12.66** |

---

![](tm238570d1_ex99-3img02.jpg)

(1) Borrowings (ex. Sub Debt/TruPs) + Brokered & Listing Service Deposits as a % of Total Deposits and Borrowings

Data is: LTM (Last 12 Months)

Source: S&P Global, Offering Circular and FinPro Computations

<u>Asset Size</u> – The Bank, at $147.0 million, is significantly smaller than each Bank in the comparable group. The Comparable Group median is larger than the assets of the Bank, with median assets of $983.6 million. At the pro forma midpoint of the offering range, the Bank is expected to have assets of $157.7 million.

Conversion Valuation Appraisal Report Page 30

<u>Asset Composition</u> – The Bank's gross loans to assets ratio of 81.57% is above the Comparable Group median of 74.94%. The Bank has a lower level of cash, securities, and other assets as a percentage of assets compared to the Comparable Group.

<u>Funding Mix</u> – The Bank's deposits to asset ratio of 87.45% is above the Comparable Group median of 76.58%. Gross loans to deposit ratio of the Bank is below peers. The Bank utilizes a lower level of borrowings and debt compared to the Comparable Group. The Bank funds itself through deposits, 87.45% of assets, and borrowings, 2.04% of assets. The Comparable Group has a deposit to assets ratio of 76.58% and a debt and borrowings to asset ratio of 9.39%. Lastly, the Bank has a lower amount of non-interest bearing deposits as a percentage of total deposits, 12.66%, compared to the Comparable Group median of 21.68%.

<u>Interest Rate Risk</u> - The Bank's interest rate risk position is illustrated discussed previously. The Bank's profile appears to be within acceptable regulatory parameters. No similar data is available for the Comparable Group.

**Figure– Capital Data**

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **Capitalization** | **Capitalization** | **Capitalization** | **Capitalization** | **Capitalization** | **Capitalization** |
| <br>**Company Name** | **Equity/<br> Assets**<br>**(%)** | **Tangible<br> Equity/<br> Tangible<br> Assets**<br>**(%)** | **Tangible<br> Common<br> Equity/<br> Tangible<br> Assets**<br>**(%)** | **Tier 1 <br> Leverage Ratio**<br>**(%)** | **Tier 1 Risk<br> Based Ratio**<br>**(%)** | **Risk Based<br> Capital <br> Ratio**<br>**(%)** |
| 1895 Bancorp of Wisconsin, Inc. (NASDAQCM:BCOW) | 14.34 | 14.34 | 14.34 | NA | NA | 17.46 |
| Blue Foundry Bancorp (NASDAQGS:BLFY) | 19.27 | 19.24 | 19.24 | NA | NA | 21.90 |
| Finward Bancorp (NASDAQCM:FNWD) | 6.59 | 5.34 | 5.34 | 7.70 | 11.20 | 12.06 |
| First Seacoast Bancorp, Inc. (NASDAQCM:FSEA) | 9.11 | 9.11 | 9.11 | NA | NA | 16.37 |
| Generations Bancorp NY, Inc. (NASDAQCM:GBNY) | 10.08 | 9.71 | 9.71 | NA | NA | 14.71 |
| HMN Financial, Inc. (NASDAQGM:HMNF) | 8.88 | 8.81 | 8.81 | NA | NA | 12.65 |
| Mid-Southern Bancorp, Inc. (NASDAQCM:MSVB) | 11.65 | 11.65 | 11.65 | 15.38 | NA | NA |
| Northeast Community Bancorp, Inc. (NASDAQCM:NECB) | 18.39 | 18.38 | 18.38 | NA | NA | 13.50 |
| PB Bankshares, Inc. (NASDAQCM:PBBK) | 11.84 | 11.84 | 11.84 | NA | NA | NA |
| Provident Bancorp, Inc. (NASDAQCM:PVBC) | 12.68 | 12.68 | 12.68 | NA | NA | 12.62 |
| Waterstone Financial, Inc. (NASDAQGS:WSBF) | 18.24 | 18.21 | 18.21 | 19.45 | 23.29 | 24.36 |
| William Penn Bancorporation (NASDAQCM:WMPN) | 20.58 | 20.08 | 20.08 | NA | NA | NA |
| 25% Percentile: | 9.84 | 9.56 | 9.56 | 11.54 | 14.22 | 12.65 |
| **Median:** | **12.26** | **12.26** | **12.26** | **15.38** | **17.25** | **14.71** |
| 75% Percentile: | 18.27 | 18.25 | 18.25 | 17.42 | 20.27 | 17.46 |
| **Mercer Savings Bank** | **9.85** | **9.85** | **9.85** | **10.13** | **15.78** | **16.78** |

---

![](tm238570d1_ex99-3img03.jpg)

Source: S&P Global, Offering Circular and FinPro Computations

Conversion Valuation Appraisal Report Page 31

<u>Capitalization -</u> The Comparable Group's median equity to assets ratio of 12.26% is above the Bank's ratio of 9.85%. The Bank's pro forma Tier 1 Leverage ratio is projected to increase at the midpoint of the valuation range. The Bank currently operates with a tangible equity/assets ratio which is below the Comparable Group's median on a pre-conversion basis. However, following the stock offering, the Bank's holding company's pro forma capital position will exceed the Comparable Group's figures by a material amount. In summary, FinPro concluded that capital strength was a positive factor in our adjustment for financial condition.

<u>Intangible Levels -</u> An important factor influencing market values is the level of intangibles that an institution carries on its books. Seven of the Comparables have intangible assets. The Bank does not have any intangible assets.

Conversion Valuation Appraisal Report Page 32

The asset quality of an institution is an important determinant of market value. The investment community considers levels of nonperforming loans, Real Estate Owned ("REO") and levels of Allowance for Loan and Lease Losses ("ALLL") in assessing the attractiveness of investing in the common stock of an institution.

**Figure– Asset Quality Data**

---

| | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **Asset Quality** | **Asset Quality** | **Asset Quality** | **Asset Quality** | **Asset Quality** | **Asset Quality** | **Asset Quality** | **Asset Quality** | **Asset Quality** |
| <br>**Company Name** | **Adjusted<br> Texas Ratio**<br>**(%)(12)** | **NPA & Loans<br> 90+ PD/<br> Tangible<br> Equity + LLR**<br>**(%)** | **Texas Ratio**<br>**(%)(2)** | **Nonaccrual<br> Loans/<br> Loans**<br>**(%)** | **NPLs/ Loans**<br>**(%)** | **NPAs/<br> Assets**<br>**(%)** | **NPA ex.<br> Performing<br> TDRs/ Total<br> Assets**<br>**(%)** | **LLR/ Gross<br> Loans**<br>**(%)** | **NCOs/ Avg<br> Loans**<br>**(%)** |
| 1895 Bancorp of Wisconsin, Inc. (NASDAQCM:BCOW) | 1.87 | NA | 1.28 | 0.21 | 0.33 | NA | NA | 0.89 | (0.04) |
| Blue Foundry Bancorp (NASDAQGS:BLFY) | 3.18 | NA | 2.83 | 0.50 | NA | NA | 0.38 | 0.87 |  |
| Finward Bancorp (NASDAQCM:FNWD) | 9.46 | 11.41 | 8.65 | NA | NA | 0.66 | 0.53 | NA | 0.03 |
| First Seacoast Bancorp, Inc. (NASDAQCM:FSEA) | 0.01 | NA | 0.21 | 0.00 | NA | NA | 0.00 | 0.91 |  |
| Generations Bancorp NY, Inc. (NASDAQCM:GBNY) | 16.12 | 16.03 | 11.77 | 1.22 | 2.07 | 1.65 | 0.98 | 0.79 | (0.01) |
| HMN Financial, Inc. (NASDAQGM:HMNF) | 2.34 | NA | 2.07 | 0.24 | NA | NA | 0.17 | 1.30 | 0.01 |
| Mid-Southern Bancorp, Inc. (NASDAQCM:MSVB) | 4.33 | 5.19 | 2.20 | 0.59 | 1.10 | 0.64 | 0.36 | 1.15 | (0.02) |
| Northeast Community Bancorp, Inc. (NASDAQCM:NECB) | 0.64 | NA | 0.64 |  | NA | NA | 0.10 | 0.45 | 0.02 |
| PB Bankshares, Inc. (NASDAQCM:PBBK) | 3.98 | 3.91 | 2.62 | 0.44 | 0.62 | 0.50 | 0.36 | 1.24 | 0.12 |
| Provident Bancorp, Inc. (NASDAQCM:PVBC) | 12.33 | NA | 5.53 | 0.38 | NA | NA | 0.71 | 1.94 | 3.26 |
| Waterstone Financial, Inc. (NASDAQGS:WSBF) | 1.15 | NA | 1.31 | NA | NA | NA | NA | 1.08 | (0.04) |
| William Penn Bancorporation (NASDAQCM:WMPN) | 3.28 | 2.73 | 3.00 | 0.86 | 0.97 | 0.56 | 0.49 | 0.67 | 0.05 |
| 25% Percentile: | 1.69 | 3.91 | 1.30 | 0.22 | 0.62 | 0.56 | 0.22 | 0.83 | (0.01) |
| **Median:** | **3.23** | **5.19** | **2.41** | **0.41** | **0.97** | **0.64** | **0.37** | **0.91** | **0.01** |
| 75% Percentile: | 5.61 | 11.41 | 3.63 | 0.57 | 1.10 | 0.66 | 0.52 | 1.19 | 0.04 |
| **Mercer Savings Bank** | **2.80** | **2.80** | **2.80** | **0.36** | **0.36** | **0.29** | **0.29** | **0.80** | **0.02** |

---

![](tm238570d1_ex99-3img04.jpg)

---

| |
|:---|
| Data is: LTM (Last 12 Months) |
| (1) Note: NPLs and NPAs include TDRs unless otherwise stated and Adjusted = Adjusted for FDIC Loss Share coverage |
| (2) Texas Ratio is defined as NPA ex. Performing TDRs / Tangible Equity + LLR; Adjusted Texas Ratio includes Performing TDRs into calculation |

---

Source: S&P Global, Offering Circular and FinPro Computations

The Bank's level of nonperforming loans ("NPL") to total loans, at 0.36%, is below the Comparable Group median at 0.97%. The Bank had a nonperforming asset to assets ratio of 0.29%, which is below the Comparable median of 0.64%. The Bank's reserve level, 0.80% of total loans, is below the Comparable median of 0.91% of loans. The Bank's level of charge offs to average loans is inline with that of the Comparable Group.

Conversion Valuation Appraisal Report Page 33

The Bank's asset mix is weaker than the Comparable Group's, primarily a result of a smaller balance sheet. The Bank has a higher level of deposits and a lower level of borrowings as a percentage of assets relative to the Comparable Group. The Bank has lower capital levels, but at the midpoint of the range will have higher capital levels. The Bank has a lower level of NPLs and NPAs, but the Bank's reserve levels as a percentage of loans are below the Comparable levels. Taken collectively, a downward adjustment is warranted for financial condition.

Conversion Valuation Appraisal Report Page 34

**Balance Sheet Growth**

The Bank's assets, loan and deposits have grown slower than the Comparable Group. The Bank experienced deposit runoff and subsequent asset declines, relative to growth for the Comparable Group.

**Figure– Growth Rate Data**

---

| | | | |
|:---|:---|:---|:---|
| | **Growth Rates** | **Growth Rates** | **Growth Rates** |
| <br>**Company Name** | **Asset <br> Growth <br> Rate**<br>**(%)** | **Loan <br> Growth <br> Rate**<br>**(%)** | **Deposit <br> Growth <br> Rate**<br>**(%)** |
| 1895 Bancorp of Wisconsin, Inc. (NASDAQCM:BCOW) | 0.53 | 10.69 | (0.76) |
| Blue Foundry Bancorp (NASDAQGS:BLFY) | 6.56 | 20.00 | 1.66 |
| Finward Bancorp (NASDAQCM:FNWD) | 27.69 | 55.93 | 23.81 |
| First Seacoast Bancorp, Inc. (NASDAQCM:FSEA) | 6.04 | 6.05 | (0.70) |
| Generations Bancorp NY, Inc. (NASDAQCM:GBNY) | 1.76 | 9.44 | 1.32 |
| HMN Financial, Inc. (NASDAQGM:HMNF) | 2.55 | 18.17 | 4.48 |
| Mid-Southern Bancorp, Inc. (NASDAQCM:MSVB) | 5.74 | 17.71 | 3.59 |
| Northeast Community Bancorp, Inc. (NASDAQCM:NECB) | 15.45 | 24.27 | 17.39 |
| PB Bankshares, Inc. (NASDAQCM:PBBK) | 23.38 | 20.81 | 15.28 |
| Provident Bancorp, Inc. (NASDAQCM:PVBC) | (5.22) | (2.17) | (12.29) |
| Waterstone Financial, Inc. (NASDAQGS:WSBF) | (8.28) | 8.09 | (2.65) |
| William Penn Bancorporation (NASDAQCM:WMPN) | 4.49 | 7.64 | 4.03 |
| 25% Percentile: | 1.45 | 7.98 | (0.72) |
| **Median:** | **5.12** | **14.20** | **2.63** |
| 75% Percentile: | 8.78 | 20.20 | 7.18 |
| **Mercer Savings Bank** | **(2.54)** | **5.02** | **(2.38)** |

---

![](tm238570d1_ex99-3img05.jpg)

Data is: LTM (Last 12 Months)

Source: S&P Global, Offering Circular and FinPro Computations

<u>Growth Rate</u> - The Comparable Group's median and 25% percentile growth rates for assets, loans and deposits are all above the growth rates of the Bank.

The Bank had lower levels of growth compared to the Comparable group and experienced deposit runoff compared to growth by the peers. Taken collectively, a strong downward adjustment is warranted.

Conversion Valuation Appraisal Report Page 35

**Earnings Quality, Predictability and<br> Growth**

The earnings quality, predictability and growth are critical components in the establishment of market values for thrifts. Thrift earnings are primarily a function of:

&nbsp;&nbsp;&nbsp;&nbsp;· net interest income

&nbsp;&nbsp;&nbsp;&nbsp;· loan loss provision

&nbsp;&nbsp;&nbsp;&nbsp;· non-interest income

&nbsp;&nbsp;&nbsp;&nbsp;· non-interest expense

The quality and predictability of earnings is dependent on both internal and external factors. Some internal factors include the mix of the balance sheet, the interest rate sensitivity of the balance sheet, the asset quality, and the infrastructure in place to deliver the assets and liabilities to the public. External factors include the competitive market for both assets and liabilities, the global interest rate scenario, local economic factors and regulatory issues.

Investors are focusing on earnings sustainability as interest rate volatility has caused a wide variation in income levels. With the intense competition for both assets and deposits, banks cannot easily replace lost spread and margin with balance sheet growth.

Each of these factors can influence the earnings of an institution, and each of these factors is volatile. Investors prefer stability and consistency. As such, solid, consistent earnings are preferred to high but risky earnings. Investors also prefer earnings to be diversified and not entirely dependent on interest income.

Conversion Valuation Appraisal Report Page 36

The Bank's net income has trended upward between the twelve months ended December 31, 2022, and December 31, 2021. The increase is predominately attributable to higher net interest income, which was a function of both higher interest income and lower interest expense. During this time frame noninterest expense rose from $3.8 million for the twelve months ended December 31, 2021, to $4.1 million for the twelve months ended December 31, 2022.

The net income for the three months ended December 31, 2022, was $149 thousand above the net income for the three months ended December 31, 2021. The growth in net income is attributable to a $143 thousand increase in net interest income. These changes were partially offset by lower noninterest income and lower noninterest expenses.

**Figure– Income Statement Data**

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| Key Financial Highlights | Key Financial Highlights | Key Financial Highlights | Key Financial Highlights | Key Financial Highlights | Key Financial Highlights | Key Financial Highlights | Key Financial Highlights | Key Financial Highlights | Key Financial Highlights | Key Financial Highlights |
| Summary Income Statement ($000's) | Summary Income Statement ($000's) | Summary Income Statement ($000's) | Summary Income Statement ($000's) | Summary Income Statement ($000's) | Summary Income Statement ($000's) | Summary Income Statement ($000's) | Summary Income Statement ($000's) | Summary Income Statement ($000's) | Growth | Growth |
| **Mercer Savings Bank** | **2021Q1** | **2021Q2** | **2021Q3** | **2021Q4** | **2022Q1** | **2022Q2** | **2022Q3** | **2022Q4** | **Quarterly** | **Annual** |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest Income: Loans & Leases | 1128 | 1097 | 1089 | 1102 | 1083 | 1089 | 1170 | 1247 | 77 | 145 |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest Income: Investments & Other | 29 | 31 | 32 | 33 | 34 | 95 | 111 | 172 | 61 | 139 |
| **Total Interest Income** | **1157** | **1128** | **1121** | **1135** | **1117** | **1184** | **1281** | **1419** | **138** | **284** |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest Expense: Deposits | 94 | 90 | 76 | 63 | 59 | 56 | 54 | 49 | -5 | -14 |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest Expense: Borrowings & Other | 10 | 9 | 9 | 9 | 9 | 7 | 7 | 7 | 0 | -2 |
| **Total Interest Expense** | **104** | **99** | **85** | **72** | **68** | **63** | **61** | **56** | **-5** | **-16** |
| **Net Interest Income** | **1053** | **1029** | **1036** | **1063** | **1049** | **1121** | **1220** | **1363** | **143** | **300** |
| Provisions for Credit Losses | 60 | 45 | 16 | 15 | 10 | 1 | 0 | 0 | 0 | -15 |
| &nbsp;&nbsp;&nbsp;&nbsp;NII Noninterest Income: Fiduciary Activities | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| &nbsp;&nbsp;&nbsp;&nbsp;NII Service Charges on Deposit Accounts | 25 | 23 | 28 | 28 | 25 | 28 | 30 | 28 | -2 | 0 |
| &nbsp;&nbsp;&nbsp;&nbsp;NII Net Servicing Fees | 2 | -1 | 8 | 18 | 12 | 10 | 9 | 10 | 1 | -8 |
| &nbsp;&nbsp;&nbsp;&nbsp;NII Net Securitization Income | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| &nbsp;&nbsp;&nbsp;&nbsp;NII Inv Banking, Advisory & Underwriting Fees | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| &nbsp;&nbsp;&nbsp;&nbsp;NII Insurance Related | 0 | 1 | 1 | -1 | 0 | 0 | 1 | 0 | -1 | 1 |
| &nbsp;&nbsp;&nbsp;&nbsp;NII Net Gain on Sale of Loans and Leases | 0 | 2 | 0 | 37 | 4 | 13 | -1 | 0 | 1 | -37 |
| &nbsp;&nbsp;&nbsp;&nbsp;NII Net Gain on Sale Other | -34 | -4 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| &nbsp;&nbsp;&nbsp;&nbsp;NII Other Noninterest Income | 65 | 75 | 75 | 70 | 68 | 76 | 245 | 72 | -173 | 2 |
| &nbsp;&nbsp;&nbsp;&nbsp;Realized Gain on Securities | 0 | 0 | 0 | 0 | 0 | 0 | 0 | -8 | -8 | -8 |
| **Total Noninterest Income** | **58** | **96** | **112** | **152** | **109** | **127** | **284** | **110** | **-174** | **-42** |
| &nbsp;&nbsp;&nbsp;&nbsp;NIE: Salary & Benefits | 456 | 459 | 473 | 498 | 498 | 506 | 521 | 530 | 9 | 32 |
| &nbsp;&nbsp;&nbsp;&nbsp;NIE: Premises & Fixed Assets | 102 | 81 | 83 | 88 | 93 | 80 | 91 | 116 | 25 | 28 |
| &nbsp;&nbsp;&nbsp;&nbsp;NIE: Amort of Intang & Goodwill Impairment | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 8 | 8 | 8 |
| &nbsp;&nbsp;&nbsp;&nbsp;NIE:Other Noninterest Expense | 372 | 378 | 400 | 384 | 384 | 367 | 452 | 414 | -38 | 30 |
| **Total Noninterest Expense** | **930** | **918** | **956** | **970** | **975** | **953** | **1064** | **1060** | **-4** | **90** |
| Net Income before Tax & Extra | 121 | 162 | 176 | 230 | 173 | 294 | 440 | 405 | -35 | 175 |
| &nbsp;&nbsp;&nbsp;&nbsp;Income Taxes | 28 | 37 | 39 | 50 | 20 | 51 | 46 | 76 | 30 | 26 |
| Net Income before Extra | 93 | 125 | 137 | 180 | 153 | 243 | 394 | 329 | -65 | 149 |
| &nbsp;&nbsp;&nbsp;&nbsp;Extraordinary Items-Net | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| **Net Income** | **93** | **125** | **137** | **180** | **153** | **243** | **394** | **329** | **-65** | **149** |

---

Source: S&P Global, Call Reports and FinPro Computations

Conversion Valuation Appraisal Report Page 37

The Bank's ROAA and ROAE are above the Comparable Group median. The Bank's higher capitalization following the offering is expected to reduce return on equity for the near term. On a pro forma basis, the Bank's ROAA and core ROAE are projected to be 0.82% and 5.24%, respectively.

The Bank yield on earning assets is below the Comparable Group median. Additionally, the Bank's cost of funds is below all comparable group peers.

The Bank's efficiency ratio of 75.00% is below the Comparable median of 77.33%.

On a forward-looking basis, after the conversion the Bank's operating expenses are expected to rise as a result of the stock benefit plans and additional costs of being a public company. At the same time, the Bank will have additional capital to deploy and leverage.

**Figure– Income Statement Data**

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | **Overall Profitability** | **Overall Profitability** | **Components of Profitability** | **Components of Profitability** | **Components of Profitability** | **Components of Profitability** | **Components of Profitability** | **Components of Profitability** |
| <br>**Company Name** | **ROAA**<br>**(%)** | **ROAE**<br>**(%)** | **Yield on<br> Earning<br> Assets**<br>**(%)** | **Cost of<br> Funds**<br>**(%)** | **Net Interest<br> Margin<br> (FTE)**<br>**(%)** | **Noninterest<br> Income/<br> Avg Assets**<br>**(%)** | **Noninterest<br> Expense/<br> Avg Assets**<br>**(%)** | **Efficiency<br> Ratio (FTE)**<br>**(%)** |
| 1895 Bancorp of Wisconsin, Inc. (NASDAQCM:BCOW) | (0.08) | (0.52) | 3.06 | 0.45 | 2.78 | 0.44 | 2.75 | 90.15 |
| Blue Foundry Bancorp (NASDAQGS:BLFY) | 0.12 | 0.58 | 3.28 | 0.71 | 2.74 | 0.07 | 2.55 | 93.18 |
| Finward Bancorp (NASDAQCM:FNWD) | 0.74 | 10.47 | 4.00 | 0.23 | 3.56 | 0.51 | 3.01 | 77.33 |
| First Seacoast Bancorp, Inc. (NASDAQCM:FSEA) | 0.29 | 2.58 | 3.27 | 0.39 | 2.99 | 0.28 | 2.90 | 87.96 |
| Generations Bancorp NY, Inc. (NASDAQCM:GBNY) | 0.42 | 3.74 | 3.91 | 0.58 | 3.51 | 0.51 | 3.09 | 85.77 |
| HMN Financial, Inc. (NASDAQGM:HMNF) | 0.75 | 7.03 | 3.30 | 0.21 | 3.10 | 0.72 | 2.50 | 66.98 |
| Mid-Southern Bancorp, Inc. (NASDAQCM:MSVB) | 0.72 | 4.69 | 3.31 | 0.44 | 2.98 | 0.41 | 2.31 | 66.50 |
| Northeast Community Bancorp, Inc. (NASDAQCM:NECB) | 1.95 | 9.60 | 6.00 | 0.83 | 5.37 | 0.29 | 2.39 | 44.01 |
| PB Bankshares, Inc. (NASDAQCM:PBBK) | 0.35 | 2.66 | 3.56 | 0.92 | 2.96 | 0.41 | 2.23 | 67.15 |
| Provident Bancorp, Inc. (NASDAQCM:PVBC) | (1.24) | (9.26) | 4.87 | 0.30 | 4.65 | 0.34 | 3.02 | 64.05 |
| Waterstone Financial, Inc. (NASDAQGS:WSBF) | 0.96 | 4.88 | 3.70 | 0.81 | 3.11 | 5.12 | 6.75 | NA |
| William Penn Bancorporation (NASDAQCM:WMPN) | 0.46 | 2.05 | 3.59 | 0.52 | 3.09 | 0.28 | 2.40 | 77.70 |
| 25% Percentile: | 0.25 | 1.68 | 3.29 | 0.37 | 2.98 | 0.29 | 2.40 | 66.74 |
| **Median:** | **0.44** | **3.20** | **3.57** | **0.49** | **3.10** | **0.41** | **2.65** | **77.33** |
| 75% Percentile: | 0.74 | 5.42 | 3.93 | 0.74 | 3.52 | 0.51 | 3.01 | 86.87 |
| **Mercer Savings Bank** | **0.73** | **8.00** | **3.38** | **0.17** | **3.22** | **0.41** | **2.66** | **75.00** |

---

![](tm238570d1_ex99-3img06.jpg)

Source: S&P Global, Call Reports and FinPro Computations

Conversion Valuation Appraisal Report Page 38

The Bank is more profitable than the Comparables on a ROAA and ROAE basis. After the conversion, the Bank is expected to have a lower ROAE. The Bank's earnings composition is generally better or inline with the Comparable Group as the Bank has a higher net margin and inline level of noninterest income and noninterest expense. Taken collectively, no adjustment is warranted for this factor.

Conversion Valuation Appraisal Report Page 39

**Market area**

The market area that an institution serves has a significant impact on value, as future success is interrelated with the economic, demographic and competitive aspects of the market. The location of an institution will have an impact on the trading value of an institution, as many analysts compare the pricing of institutions relative to a state or regional multiples in investor presentations.

The following figure compares the demographic for the market areas serviced by the Bank, to the demographics of the Comparable Group members.

**Figure– Market Demographics**

---

| | | |
|:---|:---|:---|
| | **Market Demographics** | **Market Demographics** |
| <br>**Company Name** | **2023 Median<br> Household <br> Income**<br>**($)** | **Projected <br> Annualized <br> Change in<br> Median HHI ('23-<br> '28)**<br>**(%)** |
| 1895 Bancorp of Wisconsin, Inc. (NASDAQCM:BCOW) | 72136 | 12.04 |
| Blue Foundry Bancorp (NASDAQGS:BLFY) | 116292 | 11.58 |
| Finward Bancorp (NASDAQCM:FNWD) | 69481 | 11.66 |
| First Seacoast Bancorp, Inc. (NASDAQCM:FSEA) | 83978 | 11.55 |
| Generations Bancorp NY, Inc. (NASDAQCM:GBNY) | 67026 | 13.03 |
| HMN Financial, Inc. (NASDAQGM:HMNF) | 84332 | 14.94 |
| Mid-Southern Bancorp, Inc. (NASDAQCM:MSVB) | 61256 | 11.17 |
| Northeast Community Bancorp, Inc. (NASDAQCM:NECB) | 100598 | 13.30 |
| PB Bankshares, Inc. (NASDAQCM:PBBK) | NA | NA |
| Provident Bancorp, Inc. (NASDAQCM:PVBC) | 97434 | 15.06 |
| Waterstone Financial, Inc. (NASDAQGS:WSBF) | 72632 | 11.91 |
| William Penn Bancorporation (NASDAQCM:WMPN) | 88378 | 11.93 |
| 25% Percentile: | 70809 | 11.62 |
| **Median:** | **83978** | **11.93** |
| 75% Percentile: | 92906 | 13.16 |
| **Mercer Savings Bank** | **73764** | **11.27** |

---

![](tm238570d1_ex99-3img07.jpg)

Source: S&P Global, Call Reports and FinPro Computations

Conversion Valuation Appraisal Report Page 40

**Figure– Market Demographics For Comparables**

**Mercer Savings Bank \| Market Demographics (Mercer Savings Bank)**

---

| | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **** | **** | **** | **** | **** | **** | ***Percent*** | ***Percent of*** | ***2023*** | ***2010-2023*** | ***2023-2028*** | ***2023*** | ***2023-2028*** |
| ***County*** | **** | ***Market<br> Rank*** | ***Number<br> of<br> Branches*** | ***Deposits<br> In Market<br> ($000)*** | ***Deposit<br> Market<br> Share (%)*** | ***of State<br> Franchise<br> (%)*** | ***National<br> Franchise<br> (%)*** | ***Total<br> Population<br> (Actual)*** | ***Population<br> Change (%)*** | ***Projected<br> Population<br> Change (%)*** | ***Median<br> Household<br> Income ($)*** | ***Projected HH<br> Income Change<br> (%)*** |
| **Ohio (OH)** |  |  |  |  |  |  |  |  |  |  |  |  |
| Mercer |  | 4 | 3 | 111656 | 6.61 | 80.40 | 80.40 | 42451 | 4.01 | 0.64 | 76032 | 11.60 |
| Darke |  | 11 | 1 | 27221 | 1.68 | 19.60 | 19.60 | 51332 | (3.07) | (1.01) | 64462 | 9.95 |
| **OH Totals** |  |  | **4** | **138877** |  | **100.00** | **100.00** | **93783** |  |  |  |  |
| **Weighted Average: Ohio Franchise** |  |  |  |  |  |  |  |  | **2.62** | **0.32** | **73764** | **11.27** |

---

**1895 Bancorp of Wisconsin, Inc. \| Market Demographics (1895 Bancorp of Wisconsin, Inc.)**

---

| | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **** | **** | **** | **** | **** | **** | ***Percent*** | ***Percent of*** | ***2023*** | ***2010-2023*** | ***2023-2028*** | ***2023*** | ***2023-2028*** |
| ***County*** | **** | ***Market<br> Rank*** | ***Number<br> of<br> Branches*** | ***Deposits<br> In Market<br> ($000)*** | ***Deposit<br> Market<br> Share (%)*** | ***of State<br> Franchise<br> (%)*** | ***National<br> Franchise<br> (%)*** | ***Total<br> Population<br> (Actual)*** | ***Population<br> Change (%)*** | ***Projected<br> Population<br> Change (%)*** | ***Median<br> Household<br> Income ($)*** | ***Projected HH<br> Income Change<br> (%)*** |
| **Wisconsin (WI)** |  |  |  |  |  |  |  |  |  |  |  |  |
| Milwaukee |  | 15 | 3 | 276871 | 0.42 | 68.08 | 68.08 | 924278 | (2.47) | (1.12) | 59776 | 12.68 |
| Waukesha |  | 27 | 2 | 88400 | 0.51 | 21.74 | 21.74 | 410596 | 5.31 | 1.66 | 100234 | 11.77 |
| Ozaukee |  | 12 | 1 | 41421 | 1.22 | 10.18 | 10.18 | 93143 | 7.81 | 2.55 | 94790 | 9.97 |
| **WI Totals** |  |  | **6** | **406692** |  | **100.00** | **100.00** | **1428017** |  |  |  |  |
| **Weighted Average: Wisconsin Franchise** |  |  |  |  |  |  |  |  | **0.27** | **(0.14** | **72136** | **12.20** |

---

**Blue Foundry Bancorp \| Market Demographics (Blue Foundry Bancorp)**

---

| | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **** | **** | **** | **** | **** | **** | ***Percent*** | ***Percent of*** | ***2023*** | ***2010-2023*** | ***2023-2028*** | ***2023*** | ***2023-2028*** |
| ***County*** | **** | ***Market<br> Rank*** | ***Number<br> of<br> Branches*** | ***Deposits<br> In Market<br> ($000)*** | ***Deposit<br> Market<br> Share (%)*** | ***of State<br> Franchise<br> (%)*** | ***National<br> Franchise<br> (%)*** | ***Total<br> Population<br> (Actual)*** | ***Population<br> Change (%)*** | ***Projected<br> Population<br> Change (%)*** | ***Median<br> Household<br> Income ($)*** | ***Projected HH<br> Income Change<br> (%)*** |
| **New Jersey (NJ)** |  |  |  |  |  |  |  |  |  |  |  |  |
| Bergen |  | 15 | 11 | 1113223 | 1.58 | 78.54 | 78.54 | 958976 | 5.92 | 1.50 | 118275 | 11.79 |
| Morris |  | 20 | 5 | 182384 | 0.58 | 12.87 | 12.87 | 512633 | 4.14 | 1.44 | 128691 | 10.52 |
| Passaic |  | 16 | 1 | 70932 | 0.33 | 5.00 | 5.00 | 519751 | 3.69 | 0.41 | 83801 | 11.41 |
| Essex |  | 29 | 1 | 45034 | 0.15 | 3.18 | 3.18 | 863569 | 10.16 | 1.84 | 72194 | 11.31 |
| Hudson |  | 26 | 2 | 5855 | 0.01 | 0.41 | 0.41 | 711498 | 12.18 | 0.89 | 85825 | 10.72 |
| **NJ Totals** |  |  | **20** | **1417428** |  | **100.00** | **100.00** | **3566427** |  |  |  |  |
| **Weighted Average: New Jersey Franchise** |  |  |  |  |  |  |  |  | **5.74** | **1.44** | **116292** | **11.59** |

---

**Finward Bancorp \| Market Demographics (Finward Bancorp)**

---

| | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **** | **** | **** | **** | **** | **** | ***Percent*** | ***Percent of*** | ***2023*** | ***2010-2023*** | ***2023-2028*** | ***2023*** | ***2023-2028*** |
| ***County*** | **** | ***Market<br> Rank*** | ***Number<br> of<br> Branches*** | ***Deposits<br> In Market<br> ($000)*** | ***Deposit<br> Market<br> Share (%)*** | ***of State<br> Franchise<br> (%)*** | ***National<br> Franchise<br> (%)*** | ***Total<br> Population<br> (Actual)*** | ***Population<br> Change (%)*** | ***Projected<br> Population<br> Change (%)*** | ***Median<br> Household<br> Income ($)*** | ***Projected HH<br> Income Change<br> (%)*** |
| **Illinois (IL)** |  |  |  |  |  |  |  |  |  |  |  |  |
| Cook |  | 32 | 13 | 663265 | 0.15 | 93.69 | 34.58 | 5165243 | (0.57) | (1.22) | 76354 | 14.17 |
| DuPage |  | 39 | 1 | 44691 | 0.08 | 6.31 | 2.33 | 924736 | 0.85 | (0.21) | 103897 | 8.25 |
| **IL Totals** |  |  | **14** | **707956** |  | **100.00** | **36.91** | **6089979** |  |  |  |  |
| **Weighted Average: Illinois Franchise** |  |  |  |  |  |  |  |  | **(0.48** | **(1.15** | **78093** | **13.79** |
| **Indiana (IN)** |  |  |  |  |  |  |  |  |  |  |  |  |
| Lake |  | 4 | 15 | 1159693 | 8.40 | 95.85 | 60.47 | 498070 | 0.42 | 0.48 | 63729 | 10.20 |
| Porter |  | 9 | 1 | 50215 | 1.18 | 4.15 | 2.62 | 175287 | 6.66 | 2.23 | 80921 | 10.82 |
| **IN Totals** |  |  | **16** | **1209908** |  | **100.00** | **63.09** | **673357** |  |  |  |  |
| **Weighted Average: Indiana Franchise** |  |  |  |  |  |  |  |  | **0.68** | **0.56** | **64443** | **10.23** |

---

**First Seacoast Bancorp, Inc. \| Market Demographics (First Seacoast Bancorp, Inc.)**

---

| | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **** | **** | **** | **** | **** | **** | ***Percent*** | ***Percent of*** | ***2023*** | ***2010-2023*** | ***2023-2028*** | ***2023*** | ***2023-2028*** |
| ***County*** | **** | ***Market<br> Rank*** | ***Number<br> of<br> Branches*** | ***Deposits<br> In Market<br> ($000)*** | ***Deposit<br> Market<br> Share (%)*** | ***of State<br> Franchise<br> (%)*** | ***National<br> Franchise<br> (%)*** | ***Total<br> Population<br> (Actual)*** | ***Population<br> Change (%)*** | ***Projected<br> Population<br> Change (%)*** | ***Median<br> Household<br> Income ($)*** | ***Projected HH<br> Income Change<br> (%)*** |
| **New Hampshire (NH)** |  |  |  |  |  |  |  |  |  |  |  |  |
| Strafford |  | 3 | 4 | 345588 | 14.00 | 86.36 | 86.36 | 133404 | 8.35 | 3.02 | 80894 | 11.45 |
| Rockingham |  | 19 | 1 | 54581 | 0.46 | 13.64 | 13.64 | 319300 | 8.15 | 2.82 | 103502 | 12.08 |
| **NH Totals** |  |  | **5** | **400169** |  | **100.00** | **100.00** | **452704** |  |  |  |  |
| **Weighted Average: New Hampshire Franchise** |  |  |  |  |  |  |  |  | **8.32** | **3.00** | **83978** | **11.53** |

---

Conversion Valuation Appraisal Report Page 41

**Generations Bancorp NY, Inc. \| Market Demographics (Generations Bancorp NY, Inc.)**

---

| | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **** | **** | **** | **** | **** | **** | ***Percent*** | ***Percent of*** | ***2023*** | ***2010-2023*** | ***2023-2028*** | ***2023*** | ***2023-2028*** |
| ***County*** | **** | ***Market<br> Rank*** | ***Number<br> of<br> Branches*** | ***Deposits<br> In Market<br> ($000)*** | ***Deposit<br> Market<br> Share (%)*** | ***of State<br> Franchise<br> (%)*** | ***National<br> Franchise<br> (%)*** | ***Total<br> Population<br> (Actual)*** | ***Population<br> Change (%)*** | ***Projected<br> Population<br> Change (%)*** | ***Median<br> Household<br> Income ($)*** | ***Projected HH<br> Income Change<br> (%)*** |
| **New York (NY)** |  |  |  |  |  |  |  |  |  |  |  |  |
| Seneca |  | 3 | 3 | 145000 | 20.74 | 45.18 | 45.18 | 33368 | (5.34) | (1.60) | 63907 | 10.62 |
| Cayuga |  | 10 | 3 | 66551 | 4.21 | 20.74 | 20.74 | 75087 | (6.17) | (1.89) | 68267 | 16.79 |
| Ontario |  | 9 | 3 | 55111 | 1.57 | 17.17 | 17.17 | 112745 | 4.46 | 0.92 | 76935 | 15.73 |
| Orleans |  | 4 | 1 | 54290 | 10.48 | 16.92 | 16.92 | 39699 | (7.42) | (2.16) | 63774 | 11.25 |
| **NY Totals** |  |  | **10** | **320952** |  | **100.00** | **100.00** | **260899** |  |  |  |  |
| **Weighted Average: New York Franchise** |  |  |  |  |  |  |  |  | **(4.18** | **(1.32** | **67026** | **12.88** |

---

**HMN Financial, Inc. \| Market Demographics (HMN Financial, Inc.)**

---

| | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **** | **** | **** | **** | **** | **** | ***Percent*** | ***Percent of*** | ***2023*** | ***2010-2023*** | ***2023-2028*** | ***2023*** | ***2023-2028*** |
| ***County*** | **** | ***Market<br> Rank*** | ***Number<br> of<br> Branches*** | ***Deposits<br> In Market<br> ($000)*** | ***Deposit<br> Market<br> Share (%)*** | ***of State<br> Franchise<br> (%)*** | ***National<br> Franchise<br> (%)*** | ***Total<br> Population<br> (Actual)*** | ***Population<br> Change (%)*** | ***Projected<br> Population<br> Change (%)*** | ***Median<br> Household<br> Income ($)*** | ***Projected HH<br> Income Change<br> (%)*** |
| **Iowa (IA)** |  |  |  |  |  |  |  |  |  |  |  |  |
| Marshall |  | 7 | 1 | 75170 | 5.33 | 100.00 | 7.57 | 39691 | (2.35) | (0.60) | 68357 | 9.91 |
| **IA Totals** |  |  | **1** | **75170** |  | **100.00** | **7.57** | **39691** |  |  |  |  |
| **Weighted Average: Iowa Franchise** |  |  |  |  |  |  |  |  | **(2.35** | **(0.60** | **68357** | **9.91** |
| **Minnesota (MN)** |  |  |  |  |  |  |  |  |  |  |  |  |
| Olmsted |  | 5 | 4 | 414643 | 7.19 | 47.74 | 41.77 | 165766 | 14.91 | 3.76 | 93603 | 18.11 |
| Fillmore |  | 5 | 1 | 82515 | 11.08 | 9.50 | 8.31 | 21288 | 2.02 | 1.13 | 74282 | 10.63 |
| Freeborn |  | 6 | 1 | 81130 | 9.53 | 9.34 | 8.17 | 30636 | (1.98) | (0.23) | 66764 | 14.35 |
| Mower |  | 5 | 1 | 78105 | 8.89 | 8.99 | 7.87 | 40221 | 2.70 | 1.36 | 62210 | 7.47 |
| Dodge |  | 2 | 1 | 73711 | 19.69 | 8.49 | 7.42 | 21014 | 4.61 | 1.78 | 97623 | 17.53 |
| Dakota |  | 28 | 1 | 45107 | 0.43 | 5.19 | 4.54 | 447187 | 12.20 | 3.36 | 98990 | 12.75 |
| Houston |  | 4 | 1 | 37593 | 8.26 | 4.33 | 3.79 | 18715 | (1.64) | (0.06) | 69487 | 9.27 |
| Winona |  | 7 | 1 | 31569 | 2.17 | 3.63 | 3.18 | 49301 | (4.20) | (0.54) | 71242 | 12.73 |
| Steele |  | 11 | 1 | 24238 | 2.45 | 2.79 | 2.44 | 37397 | 2.24 | 0.95 | 79815 | 12.50 |
| **MN Totals** |  |  | **12** | **868611** |  | **100.00** | **87.49** | **831525** |  |  |  |  |
| **Weighted Average: Minnesota Franchise** |  |  |  |  |  |  |  |  | **8.23** | **2.33** | **84818** | **15.03** |
| **Wisconsin (WI)** |  |  |  |  |  |  |  |  |  |  |  |  |
| Waukesha |  | 30 | 1 | 48995 | 0.28 | 100.00 | 4.94 | 410596 | 5.31 | 1.66 | 100234 | 11.77 |
| **WI Totals** |  |  | **1** | **48995** |  | **100.00** | **4.94** | **410596** |  |  |  |  |
| **Weighted Average: Wisconsin Franchise** |  |  |  |  |  |  |  |  | **5.31** | **1.66** | **100234** | **11.77** |

---

**Mid-Southern Bancorp, Inc. \| Market Demographics (Mid-Southern Bancorp, Inc.)**

---

| | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **** | **** | **** | **** | **** | **** | ***Percent*** | ***Percent of*** | ***2023*** | ***2010-2023*** | ***2023-2028*** | ***2023*** | ***2023-2028*** |
| ***County*** | **** | ***Market<br> Rank*** | ***Number<br> of<br> Branches*** | ***Deposits<br> In Market<br> ($000)*** | ***Deposit<br> Market<br> Share (%)*** | ***of State<br> Franchise<br> (%)*** | ***National<br> Franchise<br> (%)*** | ***Total<br> Population<br> (Actual)*** | ***Population<br> Change (%)*** | ***Projected<br> Population<br> Change (%)*** | ***Median<br> Household<br> Income ($)*** | ***Projected HH<br> Income Change<br> (%)*** |
| **Indiana (IN)** |  |  |  |  |  |  |  |  |  |  |  |  |
| Washington |  | 1 | 1 | 109501 | 27.78 | 53.23 | 53.23 | 28037 | (0.80) | 0.04 | 60080 | 10.19 |
| Orange |  | 3 | 1 | 57107 | 18.62 | 27.76 | 27.76 | 19795 | (0.23) | 0.24 | 59072 | 11.28 |
| Lawrence |  | 6 | 1 | 39124 | 8.44 | 19.02 | 19.02 | 44847 | (2.79) | (0.18) | 67735 | 13.44 |
| **IN Totals** |  |  | **3** | **205732** |  | **100.00** | **100.00** | **92679** |  |  |  |  |
| **Weighted Average: Indiana Franchise** |  |  |  |  |  |  |  |  | **(1.02** | **0.06** | **61256** | **11.11** |

---

**Northeast Community Bancorp, Inc. \| Market Demographics (Northeast Community Bancorp, Inc.)**

---

| | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **** | **** | **** | **** | **** | **** | ***Percent*** | ***Percent of*** | ***2023*** | ***2010-2023*** | ***2023-2028*** | ***2023*** | ***2023-2028*** |
| ***County*** | **** | ***Market<br> Rank*** | ***Number<br> of<br> Branches*** | ***Deposits<br> In Market<br> ($000)*** | ***Deposit<br> Market<br> Share (%)*** | ***of State<br> Franchise<br> (%)*** | ***National<br> Franchise<br> (%)*** | ***Total<br> Population<br> (Actual)*** | ***Population<br> Change (%)*** | ***Projected<br> Population<br> Change (%)*** | ***Median<br> Household<br> Income ($)*** | ***Projected HH<br> Income Change<br> (%)*** |
| **Massachusetts (MA)** |  |  |  |  |  |  |  |  |  |  |  |  |
| Norfolk |  | 36 | 1 | 58373 | 0.15 | 51.08 | 6.27 | 730687 | 8.92 | 2.10 | 118738 | 12.06 |
| Essex |  | 32 | 1 | 34456 | 0.10 | 30.15 | 3.70 | 814620 | 9.62 | 2.15 | 94724 | 15.94 |
| Middlesex |  | 45 | 1 | 21448 | 0.03 | 18.77 | 2.30 | 1628018 | 8.31 | 1.46 | 121029 | 15.27 |
| **MA Totals** |  |  | **3** | **114277** |  | **100.00** | **12.28** | **3173325** |  |  |  |  |
| **Weighted Average: Massachusetts Franchise** |  |  |  |  |  |  |  |  | **9.02** | **2.00** | **111927** | **13.83** |
| **New York (NY)** |  |  |  |  |  |  |  |  |  |  |  |  |
| Rockland |  | 9 | 2 | 278169 | 1.87 | 34.07 | 29.89 | 341891 | 9.69 | 2.14 | 109483 | 11.97 |
| Orange |  | 11 | 2 | 196565 | 1.83 | 24.08 | 21.12 | 407445 | 9.29 | 2.38 | 95921 | 16.00 |
| Westchester |  | 23 | 1 | 152883 | 0.23 | 18.73 | 16.43 | 1001569 | 5.53 | 0.74 | 114960 | 14.37 |
| Bronx |  | 19 | 1 | 94637 | 0.53 | 11.59 | 10.17 | 1427704 | 3.08 | (0.69) | 45729 | 11.92 |
| New York |  | 68 | 2 | 93788 | 0.01 | 11.49 | 10.08 | 1605752 | 1.25 | (0.48) | 102325 | 10.33 |
| Sullivan |  | 9 | 1 | 376 | 0.02 | 0.05 | 0.04 | 79819 | 2.93 | 1.51 | 68397 | 16.24 |
| **NY Totals** |  |  | **9** | **816418** |  | **100.00** | **87.72** | **4864180** |  |  |  |  |
| **Weighted Average: New York Franchise** |  |  |  |  |  |  |  |  | **7.08** | **1.31** | **99012** | **13.20** |

---

**PB Bankshares, Inc. \| Market Demographics (PB Bankshares, Inc.)**

---

| | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **** | **** | **** | **** | **** | **** | ***Percent*** | ***Percent of*** | ***2023*** | ***2010-2023*** | ***2023-2028*** | ***2023*** | ***2023-2028*** |
| ***County*** | **** | ***Market<br> Rank*** | ***Number<br> of<br> Branches*** | ***Deposits<br> In Market<br> ($000)*** | ***Deposit<br> Market<br> Share (%)*** | ***of State<br> Franchise<br> (%)*** | ***National<br> Franchise<br> (%)*** | ***Total<br> Population<br> (Actual)*** | ***Population<br> Change (%)*** | ***Projected<br> Population<br> Change (%)*** | ***Median<br> Household<br> Income ($)*** | ***Projected HH<br> Income Change<br> (%)*** |
| **Pennsylvania (PA)** |  |  |  |  |  |  |  |  |  |  |  |  |
| Chester |  | 18 | 2 | 186343 | 1.00 | 60.30 | 60.30 | 543020 | 8.85 | 2.40 | 115534 | 14.26 |
| Lancaster |  | 18 | 2 | 122670 | 0.76 | 39.70 | 39.70 | 557393 | 7.31 | 1.72 | 74803 | 11.53 |
| **PA Totals** |  |  | **4** | **309013** |  | **100.00** | **100.00** | **1100413** |  |  |  |  |
| **Weighted Average: Pennsylvania Franchise** |  |  |  |  |  |  |  |  | **8.24** | **2.13** | **99365** | **13.17** |

---

Conversion Valuation Appraisal Report Page 42

**Provident Bancorp, Inc. \| Market Demographics (Provident Bancorp, Inc.)**

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| | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **** | **** | **** | **** | **** | **** | ***Percent*** | ***Percent of*** | ***2023*** | ***2010-2023*** | ***2023-2028*** | ***2023*** | ***2023-2028*** |
| ***County*** | **** | ***Market<br> Rank*** | ***Number<br> of<br> Branches*** | ***Deposits<br> In Market<br> ($000)*** | ***Deposit<br> Market<br> Share (%)*** | ***of State<br> Franchise<br> (%)*** | ***National<br> Franchise<br> (%)*** | ***Total<br> Population<br> (Actual)*** | ***Population<br> Change (%)*** | ***Projected<br> Population<br> Change (%)*** | ***Median<br> Household<br> Income ($)*** | ***Projected HH<br> Income Change<br> (%)*** |
| **Massachusetts (MA)** |  |  |  |  |  |  |  |  |  |  |  |  |
| Essex |  | 12 | 3 | 708190 | 2.11 | 100.00 | 48.61 | 814620 | 9.62 | 2.15 | 94724 | 15.94 |
| **MA Totals** |  |  | **3** | **708190** |  | **100.00** | **48.61** | **814620** |  |  |  |  |
| **Weighted Average: Massachusetts Franchise** |  |  |  |  |  |  |  |  | **9.62** | **2.15** | **94724** | **15.94** |
| **New Hampshire (NH)** |  |  |  |  |  |  |  |  |  |  |  |  |
| Hillsborough |  | 7 | 1 | 400657 | 2.29 | 53.51 | 27.50 | 426530 | 6.45 | 2.12 | 96951 | 16.29 |
| Rockingham |  | 9 | 3 | 348089 | 2.96 | 46.49 | 23.89 | 319300 | 8.15 | 2.82 | 103502 | 12.08 |
| **NH Totals** |  |  | **4** | **748746** |  | **100.00** | **51.39** | **745830** |  |  |  |  |
| **Weighted Average: New Hampshire Franchise** |  |  |  |  |  |  |  |  | **7.24** | **2.44** | **99997** | **14.34** |

---

**Waterstone Financial, Inc. \| Market Demographics (Waterstone Financial, Inc.)**

---

| | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **** | **** | **** | **** | **** | **** | ***Percent*** | ***Percent of*** | ***2023*** | ***2010-2023*** | ***2023-2028*** | ***2023*** | ***2023-2028*** |
| ***County*** | **** | ***Market<br> Rank*** | ***Number<br> of<br> Branches*** | ***Deposits<br> In Market<br> ($000)*** | ***Deposit<br> Market<br> Share (%)*** | ***of State<br> Franchise<br> (%)*** | ***National<br> Franchise<br> (%)*** | ***Total<br> Population<br> (Actual)*** | ***Population<br> Change (%)*** | ***Projected<br> Population<br> Change (%)*** | ***Median<br> Household<br> Income ($)*** | ***Projected HH<br> Income Change<br> (%)*** |
| **Wisconsin (WI)** |  |  |  |  |  |  |  |  |  |  |  |  |
| Milwaukee |  | 9 | 11 | 842694 | 1.28 | 65.12 | 65.12 | 924278 | (2.47) | (1.12) | 59776 | 12.68 |
| Waukesha |  | 13 | 4 | 342480 | 1.98 | 26.47 | 26.47 | 410596 | 5.31 | 1.66 | 100234 | 11.77 |
| Washington |  | 11 | 1 | 108814 | 3.03 | 8.41 | 8.41 | 137656 | 4.37 | 1.39 | 85324 | 8.29 |
| **WI Totals** |  |  | **16** | **1293988** |  | **100.00** | **100.00** | **1472530** |  |  |  |  |
| **Weighted Average: Wisconsin Franchise** |  |  |  |  |  |  |  |  | **0.16** | **(0.17** | **72632** | **12.07** |

---

**William Penn Bancorporation \| Market Demographics (William Penn Bancorporation)**

---

| | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **** | **** | **** | **** | **** | **** | ***Percent*** | ***Percent of*** | ***2023*** | ***2010-2023*** | ***2023-2028*** | ***2023*** | ***2023-2028*** |
| ***County*** | **** | ***Market<br> Rank*** | ***Number<br> of<br> Branches*** | ***Deposits<br> In Market<br> ($000)*** | ***Deposit<br> Market<br> Share (%)*** | ***of State<br> Franchise<br> (%)*** | ***National<br> Franchise<br> (%)*** | ***Total<br> Population<br> (Actual)*** | ***Population<br> Change (%)*** | ***Projected<br> Population<br> Change (%)*** | ***Median<br> Household<br> Income ($)*** | ***Projected HH<br> Income Change<br> (%)*** |
| **New Jersey (NJ)** |  |  |  |  |  |  |  |  |  |  |  |  |
| Camden |  | 16 | 2 | 116094 | 0.75 | 55.99 | 17.83 | 524296 | 2.06 | 0.82 | 83038 | 15.19 |
| Burlington |  | 19 | 1 | 46768 | 0.29 | 22.55 | 7.18 | 465549 | 3.76 | 1.46 | 100592 | 14.59 |
| Mercer |  | 21 | 1 | 44491 | 0.19 | 21.46 | 6.83 | 387838 | 5.82 | 1.30 | 91384 | 11.90 |
| **NJ Totals** |  |  | **4** | **207353** |  | **100.00** | **31.84** | **1377683** |  |  |  |  |
| **Weighted Average: New Jersey Franchise** |  |  |  |  |  |  |  |  | **3.25** | **1.07** | **88788** | **14.35** |
| **Pennsylvania (PA)** |  |  |  |  |  |  |  |  |  |  |  |  |
| Bucks |  | 16 | 7 | 322960 | 1.20 | 72.77 | 49.60 | 647873 | 3.62 | 0.83 | 102052 | 10.56 |
| Philadelphia |  | 21 | 2 | 120865 | 0.18 | 27.23 | 18.56 | 1581552 | 3.64 | (0.19) | 51139 | 12.15 |
| **PA Totals** |  |  | **9** | **443825** |  | **100.00** | **68.16** | **2229425** |  |  |  |  |
| **Weighted Average: Pennsylvania Franchise** |  |  |  |  |  |  |  |  | **3.63** | **0.55** | **88187** | **10.99** |

---

Source: S&P Global

The Bank's market area has grown and is projected to continue to grow at a generally inline rate with the Comparable Group's markets. Household income levels are lower in the Bank's markets and are projected to grow at a similar rate with the Comparables. Based upon these factors, a moderate downward adjustment is warranted for market area.

Conversion Valuation Appraisal Report Page 43

**Cash Dividends**

Currently, most conversions are not establishing a dividend policy concurrent with the conversion. Historical issues have been fully or oversubscribing without the need for the additional enticement of dividends. After the conversion is another issue, however. Pressures on ROAE and on internal rates of return to investors prompted the industry toward cash dividends. This trend is exacerbated by the lack of growth in the market. Typically, when institutions are in a growth mode, they issue stock dividends or do not declare a dividend. When growth is stunted, these institutions shift toward reducing equity levels and thus utilize cash dividends as a tool in managing equity. Recent tax code changes have made cash dividends more attractive to investors.

**Figure– Dividends**

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Dividends** | **Dividends** | **Dividends** | **Dividends** |
| <br>**Company Name** | **Quarterly Dividends Per Share**<br>**($)** | **LTM Dividends Per Share**<br>**($)** | **LTM Dividend Payout Ratio**<br>**(%)** | **Dividend Yield**<br>**(%)** |
| 1895 Bancorp of Wisconsin, Inc. (NASDAQCM:BCOW) | NA |  | NA | NA |
| Blue Foundry Bancorp (NASDAQGS:BLFY) | NA |  | NM | NA |
| Finward Bancorp (NASDAQCM:FNWD) | 0.31 | 1.24 | 34.35 | 3.41 |
| First Seacoast Bancorp, Inc. (NASDAQCM:FSEA) | NA |  | NM | NA |
| Generations Bancorp NY, Inc. (NASDAQCM:GBNY) | NA |  | NM | NA |
| HMN Financial, Inc. (NASDAQGM:HMNF) | 0.06 | 0.24 | 13.11 | 1.09 |
| Mid-Southern Bancorp, Inc. (NASDAQCM:MSVB) | 0.06 | 0.20 | 29.41 | 1.84 |
| Northeast Community Bancorp, Inc. (NASDAQCM:NECB) | 0.06 | 0.42 | 26.58 | 1.50 |
| PB Bankshares, Inc. (NASDAQCM:PBBK) | NA |  | NM | NA |
| Provident Bancorp, Inc. (NASDAQCM:PVBC) | 0.04 | 0.08 | NM |  |
| Waterstone Financial, Inc. (NASDAQGS:WSBF) | 0.20 | 0.80 | 89.89 | 4.99 |
| William Penn Bancorporation (NASDAQCM:WMPN) | 0.03 | 0.12 | 40.00 | 1.01 |
| 25% Percentile: | 0.05 |  | 27.29 | 1.05 |
| **Median:** | **0.06** | **0.10** | **31.88** | **1.50** |
| 75% Percentile: | 0.13 | 0.29 | 38.59 | 2.62 |

---

Source: S&P Global, Call Reports and FinPro Computations

Seven of the twelve Comparable institutions had declared cash dividends. The median dividend payout ratio for the Comparable Group was 31.88%. Currently, the Bank does not pay a cash dividend as is a mutual bank.

The Bank, on a pro forma basis (at the mid point of the value range) will have an tier one leverage ratio of 12.53%. The Bank will have adequate capital and profits to pay cash dividends.

As such, no adjustment is warranted for this factor.

Conversion Valuation Appraisal Report Page 44

**Recent Regulatory Matters**

Regulatory matters influence the market for thrift conversions. The Bank will operate in substantially the same regulatory environment as the Comparable Group.

The Bank is subject to comprehensive regulation and examination by the ODFI, the chartering authority, and the FDIC, the primary federal regulator.

As such, no adjustment for this factor is warranted.

Conversion Valuation Appraisal Report Page 45

5. Other Factors

**Management**

In February 2022, the Bank hired the current President and Chief Executive Officer, Barry Parmiter, who has 25 years of experience in community bank leadership in Ohio. Since that time, the board of directors and management have conducted an extensive review of our business strategy, operations, and information technology systems and other third-party service providers. In July 2022, consistent with the Bank's strategy to implement an indirect automobile lending program, the Bank hired a Senior Vice President of Indirect Lending. The Bank is currently seeking to hire a new Senior Vice President of Lending.

The Bank has developed a good management team with considerable banking experience. The Bank's organizational chart is reasonable for an institution of its size and complexity. The Board is active and oversees and advises on all key strategic and policy decisions and holds the management to high performance standards.

As such, no adjustment appears to be warranted for this factor.

Conversion Valuation Appraisal Report Page 46

**Liquidity of the shares**

The Peer Group is by definition composed of companies that are traded in the public markets. All of the Peer Group companies trade on NASDAQ. Typically, the number of shares outstanding and market capitalization provides an indication of how much liquidity there will be in a particular stock. The market capitalization of the Peer Group companies ranged from $33.3 million to $345.8 million as of February 17, 2023, with a median market value of $125.2 million.

Mercer Bancorp is a newly formed company and has never issued capital stock. Mercer Savings Bank, as a mutual institution, is not authorized to issue capital stock. Mercer Bancorp expects that that its common stock will be quoted on the OTCQB Market operated by OTC Markets Group upon the completion of the conversion and stock offering. However, following completion of the conversion, if the Company meets Nasdaq listing requirements, it will use best efforts to obtain approval for our shares of common stock to trade on the Nasdaq Stock Market.

Overall, we anticipate that the Bank's stock will have a lower level of trading liquidity as the Peer Group companies on average and, therefore, we concluded that a downward was necessary for this factor.

***Figure– Market Pricing and Valuation***

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Size / Regional Peers** | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** |
| | | | | | | | | | **Avg Daily<br> Volume** | **Avg Daily<br> Volume** |
| <br>**Company Name** | **Date of<br> Closing<br> Price**<br>**($)** | **Market Cap.**<br>**($mil)** | **Price/ MRQ<br> Core EPS** <br>**(x)** | **Price/ LTM<br> Core EPS** <br>**(x)** | **Price/<br> Tangible<br> Book** <br>**(%)** | **Tangible<br> Premium/<br> Core Deposits** <br>**(%)** | **LTM<br> Dividend<br> Payout Ratio**<br>**(%)** | **Dividend<br> Yield**<br>**(%)** | **(Three Month)** | **(One Year)** |
| 1895 Bancorp of Wisconsin, Inc. (NASDAQCM:BCOW) | 2/17/2023 | 64.5 | 61.7 | NA | 81.7 | -3.3 | NA | NA | 3656 | 7283 |
| Blue Foundry Bancorp (NASDAQGS:BLFY) | 2/17/2023 | 333.7 | 149.6 | 133.6 | 83.8 | NA | NM | NA | 62305 | 69841 |
| Finward Bancorp (NASDAQCM:FNWD) | 2/17/2023 | 156.9 | 7.4 | 7.9 | 143.7 | NA | 34.3 | 3.4 | 5990 | 5136 |
| First Seacoast Bancorp, Inc. (NASDAQCM:FSEA) | 2/17/2023 | 52.2 | 26.8 | 35.4 | 109.2 | NA | NM | NA | 26363 | 13189 |
| Generations Bancorp NY, Inc. (NASDAQCM:GBNY) | 2/17/2023 | 25.7 | 18.7 | 15.3 | 71.3 | -4.2 | NM | NA | 1129 | 2281 |
| HMN Financial, Inc. (NASDAQGM:HMNF) | 2/17/2023 | 94.9 | NA | NA | 101.9 | NA | 13.1 | 1.1 | 2547 | 3410 |
| Mid-Southern Bancorp, Inc. (NASDAQCM:MSVB) | 2/17/2023 | 35.4 | 17.2 | 19.2 | 121.8 | 2.5 | 29.4 | 1.8 | 891 | 1943 |
| Northeast Community Bancorp, Inc. (NASDAQCM:NECB) | 2/17/2023 | 235.3 | 7.1 | 9.5 | 97.8 | NA | 26.6 | 1.5 | 67558 | 41461 |
| PB Bankshares, Inc. (NASDAQCM:PBBK) | 2/17/2023 | 33.3 | 19.4 | 24.5 | 81 | NA | NM | NA | 2453 | 3402 |
| Provident Bancorp, Inc. (NASDAQCM:PVBC) | 2/17/2023 | 170.3 | 15.3 | NM | 83.5 | NA | NM | 0 | 162799 | 67050 |
| Waterstone Financial, Inc. (NASDAQGS:WSBF) | 2/17/2023 | 345.8 | 100.1 | 18.3 | 96 | -2.7 | 89.9 | 5 | 67173 | 81288 |
| William Penn Bancorporation (NASDAQCM:WMPN) | 2/17/2023 | 155.4 | 48 | 36.7 | 96.7 | NA | 40 | 1 | 28164 | 23970 |
| 25% Percentile: |  | 48 | 16.3 | 15.3 | 83.1 | -3.5 | 27.3 | 1.1 | 2524 | 3408 |
| **Median:** |  | **125.2** | **19.4** | **19.2** | **96.4** | **-3.0** | **31.9** | **1.5** | **16177** | **10236** |
| 75% Percentile: |  | 186.5 | 54.9 | 35.4 | 103.7 | -1.4 | 38.6 | 2.6 | 63522 | 47858 |

---

Conversion Valuation Appraisal Report Page 47

**marketing of the issuance**

Three separate markets exist for thrift stocks: (1) the after-market for public companies, both fully-converted stock companies and MHC's, in which trading activity is regular and investment decisions are made based upon financial condition, earnings, capital, ROE, dividends and future prospects; (2) the new issue market in which converting thrifts are evaluated on the basis of the same factors but on a pro forma basis without the benefit of prior operations as a publicly-held Bank and stock trading history; and (3) the thrift acquisition market. All three of these markets were considered in the valuation of the Bank's to-be-issue stock.

The Public Market- The value of publicly traded thrift stocks is easily measurable, and is tracked by most investment houses and related organizations. In general, thrift stock values react to market stimuli such as interest rates, inflation, perceived industry health, projected rates of economic growth, regulatory issues, and stock market conditions in general.

The New Issue Market- In addition to thrift stock market conditions in general, the new issue market for converting thrifts is also an important consideration in determining the Bank's pro forma market value. The new issue market is separate and distinct from the market for seasoned thrift stocks in that the pricing ratios for converting issues are computed on a pro forma basis, specifically: (1) the numerator and denominator are both impacted by the conversion offering amount, unlike existing stock issues in which price change affects only the numerator; and (2) the pro forma pricing ratio incorporates assumptions regarding source and use of proceeds, effective tax rates, stock plan purchases, etc. which impact pro forma financials, whereas pricing for existing issues are based on reported financials. The distinction between pricing of converting and existing issues is perhaps no clearer than in the case of the price/book ("P/B") ratio in that the P/B ratio of a converting thrift will typically result in a discount to book value whereas in the current market for existing thrifts the P/B ratio often reflects a premium to book value. Therefore, it is appropriate to also consider the market for new issues, both at the time of the conversion and in the aftermarket.

The Acquisition Market- Also considered in the valuation was the potential impact on the Banks holding company's stock price of recently completed and pending acquisitions of other savings institutions operating in the region. There have been numerous bank and thrift acquisitions completed over the past number of years. To the extent that acquisition speculation may impact the Bank's offering, we have largely taken this into account in selecting companies for the Peer Group which operate in markets that have experienced a comparable level of acquisition activity as the Bank's market and, thus, are subject to the same type of acquisition speculation that may influence Bank's stock. However, since converting thrifts are subject to a three-year regulatory moratorium from being acquired, acquisition speculation in the Bank's stock would tend to be less compared to the stocks of the Peer Group companies.

Conversion Valuation Appraisal Report Page 48

In determining our valuation adjustment for marketing of the issue, we considered trends in both the overall thrift market, the new issue market including the new issue market for thrift conversions and the Bank acquisition market for thrift stocks. Overall, volatile market conditions coupled with the prospect of projected reduction in the number of rate increases by the Federal Reserve have led to unusual market volatility. Taking these factors and trends into account, FinPro concluded that a slight downward adjustment was appropriate in the valuation analysis for purposes of marketing of the issue.

Conversion Valuation Appraisal Report Page 49

**Valuation Adjustments**

Relative to the Comparables the following adjustments need to be made to the Bank's pro forma market value.

---

| | |
|:---|:---|
| Valuation Factor | Valuation Adjustment |
| Financial Condition | Downward |
| Balance Sheet Growth | Strong Downward |
| Earnings Quality, Predictability and Growth | No Adjustment |
| Market Area | Moderate Downward |
| Dividends | No Adjustment |
| Liquidity of the Issue | Downward |
| Recent Regulatory Matters | No Adjustment |

---

Additionally, the following adjustments should be made to the Bank's market value.

---

| | |
|:---|:---|
| Valuation Factor | Valuation Adjustment |
| Management | No Adjustment |
| Marketing of the Issuance | No Adjustment |

---

Conversion Valuation Appraisal Report Page 50

6. Valuation

In applying the accepted valuation methodology promulgated by the regulators, i.e., the pro forma market value approach, three key pricing multiples were considered. The three multiples include:

Price to core earnings ("P/E")

Price to book value ("P/B") / Price to tangible book value ("P/TB")

Price to assets ("P/A")

All of the approaches were calculated on a pro forma basis including the effects of the conversion proceeds. All of the assumptions utilized are presented.

**Discussion of Weight Given to Valuation Multiples**

To ascertain the pro forma estimated market value of the Bank, the market multiples for the Comparable Group were utilized. As a secondary check, all publicly traded thrifts, Mid-west regional thrifts and recent (2017 to date) conversions along with historical standard conversions were assessed. The data for the Comparable Group, all publicly traded thrifts, and historical offerings are showing on the following pages.

***Figure–Comparable Group Market Pricing and Valuation***

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| **Size / Regional Peers** | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** |
| | | | | | | | | | **Avg Daily<br> Volume** | **Avg Daily<br> Volume** |
| <br>**Company Name** | **Date of<br> Closing <br> Price**<br>**($)** | **Market Cap.**<br>**($mil)** | **Price/ MRQ<br> Core EPS** <br>**(x)** | **Price/ LTM<br> Core EPS** <br>**(x)** | **Price/<br> Tangible<br> Book** <br>**(%)** | **Tangible<br> Premium/<br> Core Deposits** <br>**(%)** | **LTM <br> Dividend<br> Payout Ratio**<br>**(%)** | **Dividend <br> Yield**<br>**(%)** | **(Three Month)** | **(One Year)** |
| 1895 Bancorp of Wisconsin, Inc. (NASDAQCM:BCOW) | 2/17/2023 | 64.5 | 61.7 | NA | 81.7 | -3.3 | NA | NA | 3656 | 7283 |
| Blue Foundry Bancorp (NASDAQGS:BLFY) | 2/17/2023 | 333.7 | 149.6 | 133.6 | 83.8 | NA | NM | NA | 62305 | 69841 |
| Finward Bancorp (NASDAQCM:FNWD) | 2/17/2023 | 156.9 | 7.4 | 7.9 | 143.7 | NA | 34.3 | 3.4 | 5990 | 5136 |
| First Seacoast Bancorp, Inc. (NASDAQCM:FSEA) | 2/17/2023 | 52.2 | 26.8 | 35.4 | 109.2 | NA | NM | NA | 26363 | 13189 |
| Generations Bancorp NY, Inc. (NASDAQCM:GBNY) | 2/17/2023 | 25.7 | 18.7 | 15.3 | 71.3 | -4.2 | NM | NA | 1129 | 2281 |
| HMN Financial, Inc. (NASDAQGM:HMNF) | 2/17/2023 | 94.9 | NA | NA | 101.9 | NA | 13.1 | 1.1 | 2547 | 3410 |
| Mid-Southern Bancorp, Inc. (NASDAQCM:MSVB) | 2/17/2023 | 35.4 | 17.2 | 19.2 | 121.8 | 2.5 | 29.4 | 1.8 | 891 | 1943 |
| Northeast Community Bancorp, Inc. (NASDAQCM:NECB) | 2/17/2023 | 235.3 | 7.1 | 9.5 | 97.8 | NA | 26.6 | 1.5 | 67558 | 41461 |
| PB Bankshares, Inc. (NASDAQCM:PBBK) | 2/17/2023 | 33.3 | 19.4 | 24.5 | 81 | NA | NM | NA | 2453 | 3402 |
| Provident Bancorp, Inc. (NASDAQCM:PVBC) | 2/17/2023 | 170.3 | 15.3 | NM | 83.5 | NA | NM | 0 | 162799 | 67050 |
| Waterstone Financial, Inc. (NASDAQGS:WSBF) | 2/17/2023 | 345.8 | 100.1 | 18.3 | 96 | -2.7 | 89.9 | 5 | 67173 | 81288 |
| William Penn Bancorporation (NASDAQCM:WMPN) | 2/17/2023 | 155.4 | 48 | 36.7 | 96.7 | NA | 40 | 1 | 28164 | 23970 |
| 25% Percentile: |  | 48 | 16.3 | 15.3 | 83.1 | -3.5 | 27.3 | 1.1 | 2524 | 3408 |
| **Median:** |  | **125.2** | **19.4** | **19.2** | **96.4** | **-3.0** | **31.9** | **1.5** | **16177** | **10236** |
| 75% Percentile: |  | 186.5 | 54.9 | 35.4 | 103.7 | -1.4 | 38.6 | 2.6 | 63522 | 47858 |

---

Conversion Valuation Appraisal Report Page 51

***Figure–All Publicly Traded Thrifts Market Pricing and Valuation***

---

| | | | | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** | **Market Pricing and Valuation** |
|  | | | | | | | | | | | | **Avg Weekly<br> Volume/<br> Shares Out** | **Avg Weekly<br> Volume/<br> Shares Out** | **Avg Daily<br> Volume** | **Avg Daily<br> Volume** |
|  | <br>**Company Name** | **Date of<br> Closing<br> Price**<br>**($)** | **Market<br> Cap.**<br>**($mil)** | **Price/<br> MRQ EPS**<br>**(x)** | **Price/ <br> LTM EPS**<br>**(x)** | **Price/<br> Tangible<br> Book** <br>**(%)** | **Tangible<br> Premium/ Core<br> Deposits** <br>**(%)** | **LTM Dividend<br> Payout Ratio**<br>**(%)** | **Dividend<br> Yield**<br>**(%)** | **Price Change<br> Since IPO**<br>**(%)** | **Price/<br> Assets (%)**<br>**(%)** | **(Three<br> Month)** | **(One Year)** | **(Three <br> Month)** | **(One Year)** |
| 1 | 1895 Bancorp of Wisconsin, Inc. (NASDAQCM:BCOW) | 2/17/2023 | 64.5 | 124.5 | NA | 81.7 | -3.3 | NA | NA | NA | 12.2 | 0.28 | 0.56 | 3656 | 7283 |
| 2 | Axos Financial, Inc. (NYSE:AX) | 2/17/2023 | 3014.4 | 9.3 | 11.7 | 184.9 | NA | NM | NA | 0 | 12.2 | 2.49 | 2.75 | 298988 | 329533 |
| 3 | Blue Foundry Bancorp (NASDAQGS:BLFY) | 2/17/2023 | 333.7 | 149.6 | 133 | 83.8 | NA | NM | NA | 29 | 17.3 | 1.12 | 1.25 | 62305 | 69841 |
| 4 | Broadway Financial Corporation (NASDAQCM:BYFC) | 2/17/2023 | 100.3 | 16.4 | 16.4 | 95.7 | NA | NA | 0 | 124.1 | NA | 1.01 | 1.76 | 96924 | 169139 |
| 5 | Capitol Federal Financial, Inc. (NASDAQGS:CFFN) | 2/17/2023 | 1140.5 | 17.9 | 14.8 | 111.8 | NA | 126.7 | 4 | 120 | 11.9 | 2.76 | 2.48 | 730853 | 657996 |
| 6 | Carver Bancorp, Inc. (NASDAQCM:CARV) | 2/17/2023 | 19.6 | NM | NM | 100.9 | NA | NM | 0 | -23.4 | 2.6 | 2.32 | 10.59 | 19623 | 89475 |
| 7 | Cullman Bancorp, Inc. (NASDAQCM:CULL) | 2/17/2023 | 86.7 | 22.5 | 22.1 | 88 | -5.1 | 22.6 | 1 | NA | 19.4 | 0.14 | 0.28 | 2075 | 4190 |
| 8 | Finward Bancorp (NASDAQCM:FNWD) | 2/17/2023 | 156.9 | 9.8 | 10.1 | 143.7 | NA | 34.3 | 3.4 | NA | 7.5 | 0.70 | 0.60 | 5990 | 5136 |
| 9 | First Northwest Bancorp (NASDAQGM:FNWB) | 2/17/2023 | 137.8 | 5.7 | 8.9 | 91.6 | NA | 16.4 | 1.9 | 21.8 | 7.3 | 0.61 | 0.66 | 11175 | 11955 |
| 10 | First Seacoast Bancorp, Inc. (NASDAQCM:FSEA) | 2/17/2023 | 52.2 | 26.8 | 34.4 | 109.2 | NA | NM | NA | NA | 12 | NA | NA | 26363 | 13189 |
| 11 | FS Bancorp, Inc. (NASDAQCM:FSBW) | 2/17/2023 | 279.5 | 9.5 | 9.9 | 125.6 | 2.9 | 25.7 | 2.7 | 0.1 | 9.8 | 1.39 | 1.92 | 21098 | 29076 |
| 12 | Generations Bancorp NY, Inc. (NASDAQCM:GBNY) | 2/17/2023 | 25.7 | 20.9 | 16.2 | 71.3 | -4.2 | NM | NA | NA | 7 | 0.24 | 0.48 | 1129 | 2281 |
| 13 | Hingham Institution for Savings (NASDAQGM:HIFS) | 2/17/2023 | 627.3 | 13.4 | 17.1 | 162.5 | 13.3 | 17.8 | 0.9 | NA | 14.1 | 1.76 | 1.12 | 7552 | 4812 |
| 14 | HMN Financial, Inc. (NASDAQGM:HMNF) | 2/17/2023 | 94.9 | 9.8 | 12 | 101.9 | NA | 13.1 | 1.1 | 93.1 | 8.7 | 0.29 | 0.39 | 2547 | 3410 |
| 15 | Home Federal Bancorp, Inc. of Louisiana (NASDAQCM:HFBL) | 2/17/2023 | 59.9 | 9.1 | 11.4 | 128.1 | NA | 26.3 | 2.4 | -17.8 | 9.3 | 0.14 | 0.40 | 857 | 2385 |
| 16 | Kearny Financial Corp. (NASDAQGS:KRNY) | 2/17/2023 | 651.1 | 83.6 | 14.3 | 103.1 | NA | 62.9 | 4.5 | 57.2 | 8.3 | 1.87 | 2.33 | 242737 | 303797 |
| 17 | Mid-Southern Bancorp, Inc. (NASDAQCM:MSVB) | 2/17/2023 | 35.4 | 17.2 | 19.2 | 121.8 | 2.5 | 29.4 | 1.8 | NA | 14.5 | 0.16 | 0.36 | 891 | 1943 |
| 18 | New York Community Bancorp, Inc. (NYSE:NYCB) | 2/17/2023 | 6396.6 | 7.8 | 7.5 | 114.1 | NA | 40.5 | 7.2 | 3355.7 | 6.5 | 7.17 | 6.24 | 9763143 | 8499882 |
| 19 | Northeast Community Bancorp, Inc. (NASDAQCM:NECB) | 2/17/2023 | 235.3 | 7.4 | 10.1 | 97.8 | NA | 26.6 | 1.5 | NA | 16.8 | 2.29 | 1.40 | 67558 | 41461 |
| 20 | Northfield Bancorp, Inc. (Staten Island, NY) (NASDAQGS:NFBK) | 2/17/2023 | 703.1 | 12 | 11.2 | 106.5 | NA | 39.4 | 3.5 | 46.6 | 13.3 | 1.54 | 1.41 | 147560 | 134475 |
| 21 | NSTS Bancorp, Inc. (NASDAQCM:NSTS) | 2/17/2023 | 57.4 | 132.9 | NA | 72.5 | -13.8 | NA | NA | 25.9 | 21.8 | 0.59 | 0.83 | 6374 | 8942 |
| 22 | OP Bancorp (NASDAQGM:OPBK) | 2/17/2023 | 175.6 | 5.6 | 5.4 | 103 | NA | 21.5 | 4.2 | 8.2 | 8.1 | 0.80 | 1.32 | 24441 | 40078 |
| 23 | PB Bankshares, Inc. (NASDAQCM:PBBK) | 2/17/2023 | 33.3 | 20.6 | 26.4 | 81 | NA | NM | NA | 30.8 | 9 | 0.49 | 0.67 | 2453 | 3402 |
| 24 | Ponce Financial Group, Inc. (NASDAQGM:PDLB) | 2/17/2023 | 213.5 | NM | NM | 85.7 | NA | NM | NA | NA | 11.1 | 1.62 | 1.43 | 74905 | 66357 |
| 25 | Provident Bancorp, Inc. (NASDAQCM:PVBC) | 2/17/2023 | 170.3 | 15.3 | NM | 83.5 | NA | NM | 0 | NA | 7.9 | 4.69 | 1.93 | 162799 | 67050 |
| 26 | Provident Financial Services, Inc. (NYSE:PFS) | 2/17/2023 | 1799.6 | 9.1 | 10.2 | 158.3 | 6.6 | 40.9 | 4 | 55 | 11.6 | 2.38 | 2.45 | 354592 | 364399 |
| 27 | Riverview Bancorp, Inc. (NASDAQGS:RVSB) | 2/17/2023 | 153.7 | 7.4 | 8.1 | 123.4 | NA | 26.7 | 3.3 | NA | 10.3 | 0.53 | 0.54 | 22713 | 23059 |
| 28 | Southern Missouri Bancorp, Inc. (NASDAQGM:SMBC) | 2/17/2023 | 545.1 | 9.6 | 10.2 | 145.9 | NA | 17.5 | 1.8 | 102.5 | 12.3 | 1.56 | 1.37 | 28824 | 25235 |
| 29 | Sterling Bancorp, Inc. (Southfield, MI) (NASDAQCM:SBT) | 2/17/2023 | 317 | NM | 78 | 95.8 | NA | NM | 0 | 1.3 | 12.7 | 0.24 | 0.57 | 24288 | 57927 |
| 30 | TC Bancshares, Inc. (NASDAQCM:TCBC) | 2/17/2023 | 73.5 | 29.3 | NA | 94 | -4.1 | NA | 0.6 | 21.1 | 17.2 | 0.34 | 0.52 | 2998 | 4657 |
| 31 | Territorial Bancorp Inc. (NASDAQGS:TBNK) | 2/17/2023 | 208 | 15.1 | 13.1 | 83.5 | -3.6 | 56.7 | 3.9 | 49.9 | 10 | 0.94 | 0.75 | 16543 | 13137 |
| 32 | Third Coast Bancshares, Inc. (NASDAQGS:TCBX) | 2/17/2023 | 259.7 | 10.9 | 15.4 | 87.6 | NA | NM | NA | 0 | 6.7 | 1.05 | 1.83 | 28478 | 49399 |
| 33 | Timberland Bancorp, Inc. (NASDAQGM:TSBK) | 2/17/2023 | 286.5 | 9.7 | 11.4 | 138.2 | NA | 32.2 | 2.6 | 190 | 15.3 | 0.95 | 0.68 | 15588 | 11260 |
| 34 | TrustCo Bank Corp NY (NASDAQGS:TRST) | 2/17/2023 | 704.6 | 8.4 | 9.4 | 117.6 | NA | 35.9 | 3.9 | NA | 11.9 | 2.22 | 1.97 | 84551 | 74947 |
| 35 | Waterstone Financial, Inc. (NASDAQGS:WSBF) | 2/17/2023 | 345.8 | 100.1 | 18 | 96 | -2.7 | 89.9 | 5 | 23.4 | 18.8 | 1.51 | 1.82 | 67173 | 81288 |
| 36 | Western New England Bancorp, Inc. (NASDAQGS:WNEB) | 2/17/2023 | 222.8 | 6 | 8.5 | 104.4 | NA | 21.2 | 2.8 | 337.7 | 8.2 | 1.00 | 0.71 | 44384 | 31705 |
| 37 | William Penn Bancorporation (NASDAQCM:WMPN) | 2/17/2023 | 155.4 | 37.1 | 39.6 | 96.7 | NA | 40 | 1 | NA | 19.7 | 1.05 | 0.89 | 28164 | 23970 |
| 38 | WSFS Financial Corporation (NASDAQGS:WSFS) | 2/17/2023 | 3133 | 9.3 | 14.6 | 262.6 | NA | 16.6 | 1.2 | NA | 14 | 2.11 | 2.54 | 259758 | 312867 |
|  | 25% Percentile: | 2/17/2023 | 88.8 | 9.2 | 10.1 | 88.9 | -4.1 | 21.4 | 1 | 6.5 | 8.3 | 0.53 | 0.60 | 6669 | 7698 |
|  | **Median:** | 2/17/2023 | 210.8 | 12 | 12.6 | 102.5 | -3.3 | 28.1 | 2.4 | 29.9 | 11.9 | 1.05 | 1.25 | 25402 | 30391 |
|  | 75% Percentile: | 2/17/2023 | 495.3 | 21.7 | 17.4 | 123 | 2.7 | 40.1 | 3.9 | 95.5 | 14.1 | 1.87 | 1.92 | 82140 | 79703 |

---

<u>Price to Earnings</u> – According to the Appraisal Guidelines: "When both the converting institution and the comparable companies are recording "normal" earnings, a P/E approach may be the simplest and most direct method of valuation. When earnings are low or negative, however, this approach may not be appropriate and the greater consideration should be given to the P/BV approach." In this particular case, the Bank's earnings are "normal". As a basis for comparison, the price to core earnings was utilized for both the Bank and the Comparable Group to eliminate any nonrecurring items. As such, this approach was considered in this appraisal.

In the pro forma figures for the Bank, FinPro incorporated the impact of SFAS 123, which requires the expensing of stock options. In preparing the fully converted pro forma figures for the Comparable Group, FinPro also incorporated the impact of SFAS 123.

Conversion Valuation Appraisal Report Page 52

<u>Price to Book/Price to Tangible Book</u> - According to the Appraisal Guidelines: "The P/BV approach works best when the converting institution and the Comparables have a normal amount of book value. The P/BV approach could seriously understate the value of an institution that has almost no book value but has an outstanding future earnings potential. For converting institutions with high net worth, the appraiser may have difficulty in arriving at a pro forma market value because of pressure placed on the P/E multiple as higher P/BV levels are required to reflect a similar P/BV ratio as the peer group average. The P/BV approach also suffers from the use of historical cost accounting data."

Since thrift earnings in general have had a high degree of volatility over the past decade, the P/B is utilized frequently as the benchmark for market value. A better approach is the P/TB approach. In general, investors tend to price financial institutions on a tangible book basis, because it incorporates the P/B approach adjusted for intangibles. Initially following conversion, FinPro believes that thrifts often trade on a price to tangible book basis.

<u>Price to Assets</u> - According to the Appraisal Guidelines: "This approach remedies the problems of a small base that can occur with the P/BV approach, but the approach has many of the other limitations of the latter approach (the P/BV approach)." FinPro places little weight on this valuation approach due to the lack of consideration of asset and funding mixes and the resulting earnings impact.

Conversion Valuation Appraisal Report Page 53

**Offering Value in Relation to Comparables**

Based upon the premiums and discounts defined in the section above, the Bank's aggregate pro forma market value (excluding the stock foundation) at the midpoint is estimated to be $13,000,000. Based upon a range below and above the midpoint value, the relative values are $11,050,000 at the minimum and $14,950,000 at the maximum, respectively. At the super maximum of the estimated value range, the offering value would be $17,192,500.

At the various levels of the estimated value range, the full offering would result in the following offering data:

**Figure - Value Range - Full Offering**

---

| | | | |
|:---|:---|:---|:---|
|  | Total Shares | Price | Total |
| Conclusion | Shares | Per Share | Value |
| Appraised Value - Midpoint | 1300000 | $10.00 | $13000000 |
| Range: |  |  |  |
| &nbsp;&nbsp;&nbsp;- Minimum | 1105000 | $10.00 | 11050000 |
| &nbsp;&nbsp;&nbsp;- Maximum | 1495000 | 10.00 | 14950000 |
| &nbsp;&nbsp;&nbsp;- Super Maximum | 1719250 | 10.00 | 17192500 |

---

Source: FinPro Inc. Pro Forma Model

This equates to the following multiples:

**Figure - Value Range Pricing Multiples**

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  |  | Bank | Comparables | Comparables | Region | Region | National | National |
|  |  |  | Mean | Median | Mean | Median | Mean | Median |
|  | Min | 7.58 |  |  |  |  |  |  |
| <u>Price-Core Earnings Ratio P/E</u> | Mid | 8.62 | 33.40 | 19.20 | 23.34 | 16.42 | 20.00 | 11.40 |
|  | Max | 9.62 |  |  |  |  |  |  |
|  | Smax | 10.75 |  |  |  |  |  |  |
|  | Min | 51.41% |  |  |  |  |  |  |
| <u>Price-to-Book Ratio P/B</u> | Mid | 55.83% | 94.40% | 94.80% | 105.59% | 101.10% | 102.10% | 97.70% |
|  | Max | 59.67% |  |  |  |  |  |  |
|  | Smax | 63.49% |  |  |  |  |  |  |
|  | Min | 51.41% |  |  |  |  |  |  |
| <u>Price-to-Tangible Book Ratio P/TB</u> | Mid | 55.83% | 97.40% | 96.40% | 111.18% | 101.94% | 102.50% | 111.90% |
|  | Max | 59.67% |  |  |  |  |  |  |
|  | Smax | 63.49% |  |  |  |  |  |  |
|  | Min | 7.49% |  |  |  |  |  |  |
| <u>Price-to-Assets Ratio P/A</u> | Mid | 8.66% | 12.60% | 12.09% | 13.52% | 12.26% | 11.80% | 11.90% |
|  | Max | 9.81% |  |  |  |  |  |  |
|  | Smax | 11.09% |  |  |  |  |  |  |

---

Source: FinPro Inc. Pro Forma Model

Conversion Valuation Appraisal Report Page 54

**Figure - Comparable Pricing Multiples to the Bank's Pro Forma Midpoint**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Price Relative to | Price Relative to | Price Relative to | Price Relative to |
|  | Core Earnings | Book | Tangible Book | Assets |
| The Bank (at midpoint) Full Conversion | 8.62 | 55.83% | 55.83% | 8.66% |
| Comparable Group Median | 19.20 | 94.80% | 96.40% | 12.09% |
| (Discount) Premium | -55.10% | -41.11% | -42.09% | -28.40% |

---

Source: FinPro Calculations

Figure above illustrates that at the midpoint of the estimated valuation range the Bank is priced at a 55.10% discount to the Comparable median price to core earnings multiple. On a tangible book basis, the Bank is priced at a -42.09% discount.

**Figure - Comparable Pricing Multiples to the Bank's Pro Forma Super maximum**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Price Relative to | Price Relative to | Price Relative to | Price Relative to |
|  | Core Earnings | Book | Tangible Book | Assets |
| The Bank (at the supermax) Full Conversion | 10.75 | 63.49% | 63.49% | 11.09% |
| Comparable Group Median | 19.20 | 94.80% | 96.40% | 12.09% |
| (Discount) Premium | -44.01% | -33.03% | -34.14% | -8.31% |

---

Source: FinPro Calculations

Figure above illustrates that at the super maximum of the estimated valuation range the Bank is priced at a 44.01% discount to the Comparable median price to core earnings multiple. On a tangible book basis, the Bank is priced at a 34.14% discount.

Conversion Valuation Appraisal Report Page 55

**Comparison to Recent Standard Conversions**

As a secondary check FinPro reviewed the pro forma pricing multiples of the Bank relative to the other recent standard conversion pro forma pricing multiples.

***Figure–Recent Standard Conversion Offerings***

---

| | | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | | | **Offering Data** | **Offering Data** | **Offering Data** | **Offering Data** | **Offering Data** | **Offering Data** | **Financial Performance At Offering** | **Financial Performance At Offering** | **Financial Performance At Offering** | **Financial Performance At Offering** | **Financial Performance At Offering** |
| <br>**Institution Name** | <br>**State** | <br>**Trading <br> Symbol** | **Offering<br> Completion<br> Date** | **Offering<br> Announcement <br> Date** | **Net<br> Proceeds<br> $000s** | **Pro Forma <br> Price/ <br> Earnings <br> (x)** | **Pro Forma<br> Price/ Book<br> (%)** | **Pro Forma<br> Price/<br> Tangible<br> Book<br> (%)** | **Total<br> Assets<br> $000s** | **ROAE<br> (%)** | **Core ROAE<br> (%)** | **Tangible<br> Equity/<br> Tangible<br> Assets<br> (%)** | **NPAs/<br> Assets<br> (%)** |
| ECB Bancorp, Inc. | MA | ECBK | 7/27/2022 | 3/10/2022 | 75794 | 25.9 | 59.8 | 59.8 | 688639 | 5.40 | 7.11 | 11.42 | NA |
| VWF Bancorp, Inc. | OH | VWFB | 7/13/2022 | 3/3/2022 | 15422 | 250 | 50.2 | 50.2 | 137048 | 0.11 | 1.02 | 17.62 | NA |
| NSTS Bancorp, Inc. | IL | NSTS | 1/18/2022 | 7/19/2021 | 44494 | NM | 59.7 | 59.7 | 259881 | 0.19 | (0.03) | 17.68 | 0.68 |
| PB Bankshares, Inc. | PA | PBBK | 7/14/2021 | 3/8/2021 | 23083 | NM | 61.7 | 61.7 | 281066 | (1.66) | (0.68) | 7.76 | 1.04 |
| TC Bancshares, Inc. | GA | TCBC | 7/20/2021 | 3/5/2021 | 41777 | NM | 59.9 | 59.9 | 363624 | 2.02 | 4.22 | 11.14 | NA |
| Texas Community Bancshares, Inc. | TX | TCBS | 7/14/2021 | 3/3/2021 | 26776 | 86.3 | 53.2 | 56 | 316501 | 2.27 | 2.27 | 9.85 | 0.53 |
| Catalyst Bancorp, Inc. | LA |  | 10/12/2021 | 3/12/2021 | 44958 | NM | 55.5 | 55.5 | 238329 | (1.38) | NA | 21.29 | 1.92 |
| Systematic Savings Bank | MO |  | 10/13/2020 | 3/18/2020 | 5101 | 62.5 | 58.7 | 58.7 | 39995 | 2.18 | 2.18 | 12.64 | 0.08 |
| Eureka Homestead Bancorp, Inc. | LA | ERKH | 7/9/2019 | 3/1/2019 | 11311 | 44.7 | 60.6 | 60.6 | 98403 | 2.32 | NA | 12.52 | 0.00 |
| Richmond Mutual Bancorporation, Inc. | IN | RMBI | 7/1/2019 | 2/6/2019 | 111240 | 18.9 | 74.5 | 74.5 | 882800 | 6.98 | 6.94 | 10.10 | 0.26 |
| CBM Bancorp, Inc. | MD |  | 9/27/2018 | 5/23/2018 | 35785 | 41.7 | 73.5 | 73.5 | 184177 | 0.95 | NA | 11.95 | 0.86 |
| Sidney Federal Savings and Loan Association | NE |  | 7/26/2018 | 10/17/2017 | 816 | NM | 71 | 71 | 16660 | (26.09) | (26.09) | 5.66 | 0.14 |
| Heritage NOLA Bancorp, Inc. | LA | HRGG | 7/12/2017 | 3/7/2017 | 13347 | NM | 72.5 | 72.5 | 104063 | NA | NA | 9.19 | NA |
| Eagle Financial Bancorp, Inc. | OH | EFBI | 7/20/2017 | 3/3/2017 | 12543 | 10.2 | 61.7 | 61.7 | 119296 | 7.68 | 7.68 | 11.49 | 0.96 |
| Community Savings Bancorp, Inc. | OH |  | 1/10/2017 | 8/25/2016 | 2684 | 6.1 | 57.3 | 57.3 | 53606 | NA | NA | 12.43 | NA |
| HV Bancorp, Inc. | PA | HVBC | 1/11/2017 | 7/20/2016 | 17899 | 22.7 | 70.7 | 70.7 | 177115 | 8.43 | 8.29 | 7.45 | 0.93 |
| 25th Percentile: |  |  |  |  | 12235 | 19.8 | 58.3 | 58.3 | 102648 | 0.13 | 0.49 | 9.69 | 0.20 |
| **Median** |  |  |  |  | **20491** | **33.8** | **60.3** | **60.3** | **180646** | **2.10** | **2.27** | **11.46** | **0.68** |
| **Average** |  |  |  |  | **30189** | **56.9** | **62.5** | **62.7** | **247575** | **0.67** | **1.17** | **11.89** | **0.67** |
| 75th Percentile: |  |  |  |  | 42456 | 58 | 70.8 | 70.8 | 289925 | 4.63 | 7.02 | 12.55 | 0.94 |

---

***Figure–Median Pro Forma Price/ TBV Trend***

![](tm238570d1_ex99-3img08.jpg)

Conversion Valuation Appraisal Report Page 56

&nbsp;&nbsp;**Valuation Conclusion**

It is, FinPro's opinion that as of February 23, 2023, the estimated aggregate pro forma market value of the Bank was $13,000,000 at the midpoint of a range (excluding foundation shares) with a minimum of $11,050,000 to a maximum of $14,950,000 at 15% below and 15% above the midpoint of the range respectively. Assuming an adjusted maximum value of 15% above the maximum value, the adjusted maximum value or super maximum value is $17,192,500. The stock will be issued at $10.00 per share.

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Pre Foundation** | **Pre Foundation** | **Pre Foundation** | **Pre Foundation** |
|  | Appraised Value | Appraised Value | Appraised Value | Appraised Value |
| Conclusion | Minimum | Midpoint | Maximum | SuperMaximum \* |
| Total Shares | 1105000 | 1300000 | 1495000 | 1719250 |
| Price per Share | $10 | $10 | $10 | $10 |
| Full Conversion Value | $11050000 | $13000000 | $14950000 | $17192500 |
| Conversion Shares | 1105000 | 1300000 | 1495000 | 1719250 |
| Conversion Percent | 100.00% | 100.00% | 100.00% | 100.00% |
| Gross Proceeds | $11050000 | $13000000 | $14950000 | $17192500 |

---

\* SuperMaximum is an overallotment option that is 15% above the maximum amount.

The document represents an initial valuation for the Bank. Due to the duration of time that passes between the time this document is compiled and the time the offering closes, numerous factors could lead FinPro to update or revised the appraised value of the Bank. Some factors that could lead FinPro to adjust the appraised value include: (1) changes in the Bank's operations and financial condition; (2) changes in the market valuation or financial condition of the Comparable Group; (3) changes in the broader market; and (4) changes in the market for thrift conversions. Should there be material changes to any of these factors, FinPro will prepare an appraisal update to appropriately adjust the value of the Bank. At the time of closing, FinPro will prepare a final appraisal to determine if the valuation range is still appropriate and determine the exact valuation amount appropriate for the Bank.

Conversion Valuation Appraisal Report Page 57

7. Exhibits

Exhibit 1. Pro Forma Regulatory Capital Ratios

---

| | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | | | Minimum | Minimum | Midpoint | Midpoint | Maximum | Maximum | Adj. Maximum | Adj. Maximum |
|  | Historical | Historical | 1105000 | 1105000 | 1300000 | 1300000 | 1495000 | 1495000 | 1719250 | 1719250 |
|  | $% | % | $% | % | $% | % | $% | % | $% | % |
| GAAP Capital |  | 9.9% |  | 11.9% |  | 12.3% |  | 12.8% |  | 13.3% |
| Tier 1 Leverage Capital |  | 10.2% |  | 12.1% |  | 12.5% |  | 12.9% |  | 13.4% |
| Tier 1 Leverage Requirement |  | 5.0% |  | 5.0% |  | 5.0% |  | 5.0% |  | 5.0% |
| Excess |  | 5.2% |  | 7.1% |  | 7.5% |  | 7.9% |  | 8.4% |
| Tier 1 Risk based |  | 15.8% |  | 19.1% |  | 19.8% |  | 20.6% |  | 21.4% |
| Risk-Based Capital Requirement |  | 8.0% |  | 8.0% |  | 8.0% |  | 8.0% |  | 8.0% |
| Excess |  | 7.8% |  | 11.1% |  | 11.8% |  | 12.6% |  | 13.4% |
| Total Risk-Based Capital |  | 16.8% |  | 20.1% |  | 20.8% |  | 21.6% |  | 22.4% |
| Risk-Based Capital Requirement |  | 10.0% |  | 10.0% |  | 10.0% |  | 10.0% |  | 10.0% |
| Excess |  | 6.8% |  | 10.1% |  | 10.8% |  | 11.6% |  | 12.4% |
| Common Equity Tier 1 Risk-Based |  | 15.8% |  | 19.1% |  | 19.8% |  | 20.6% |  | 21.4% |
| Common Equity Tier 1 Risk-Based Requirement |  | 6.5% |  | 6.5% |  | 6.5% |  | 6.5% |  | 6.5% |
| Excess |  | 9.3% |  | 12.6% |  | 13.3% |  | 14.1% |  | 14.9% |
| Reconcilation of Capital Infused in Mercer Savings Bank: |  |  |  |  |  |  |  |  |  |  |
| 50% of Net Proceeds |  |  |  |  |  |  |  |  |  |  |
| Less: ESOP |  |  |  |  |  |  |  |  |  |  |
| Less: MRP |  |  |  |  |  |  |  |  |  |  |
| Pro Forma Increase |  |  |  |  |  |  |  |  |  |  |

---

Conversion Valuation Appraisal Report Page 58

Exhibit 2. Pro Forma Analysis Sheet

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | | Company Pro Forma Based Upon Sale at $10.00 Per Share | Company Pro Forma Based Upon Sale at $10.00 Per Share | Company Pro Forma Based Upon Sale at $10.00 Per Share | Company Pro Forma Based Upon Sale at $10.00 Per Share |
|  |<br><br>Bank<br>Historical | 1105000<br>Shares<br>(Minimum of<br>Estimated<br>Price Range) | 1300000<br>Shares<br>(Midpoint of<br>Estimated<br>Price Range) | 1495000<br>Shares<br>(Maximum of<br>Estimated<br>Price Range) | 1719250<br>Shares<br>(15% above Max of<br>Estimated<br>Price Range) |
|  | (In thousands) | (In thousands) | (In thousands) | (In thousands) | (In thousands) |
| Deposits | $127699 | $127699 | $127699 | $127699 | $127699 |
| Borrowings | 3000 | 3000 | 3000 | 3000 | 3000 |
| Total Deposits and Borrowings | $130699 | $130699 | $130699 | $130699 | $130699 |
| Stockholders' equity: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Preferred | $- | $- | $- | $- | $- |
| &nbsp;&nbsp;&nbsp;Common |  | 12 | 14 | 15 | 18 |
| &nbsp;&nbsp;&nbsp;APIC |  | 9288 | 11236 | 13185 | 15425 |
| &nbsp;&nbsp;&nbsp;Retained Earnings | 15288 | 15288 | 15288 | 15288 | 15288 |
| &nbsp;&nbsp;&nbsp;Net unrealized g/(l) on AFS, net | (763) | (763) | (763) | (763) | (763) |
| Plus: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Amount of the foundation |  | 500 | 500 | 500 | 500 |
| Less: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;After Tax Expense of foundation |  | (474) | (474) | (474) | (474) |
| Less: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;CS acquired by old ESOP |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;CS acquired by old MRP |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;CS to be acquired by ESOP |  | (924) | (1080) | (1236) | (1415) |
| &nbsp;&nbsp;&nbsp;CS to be acquired by MRP | - | (462) | (540) | (618) | (708) |
| Total Stockholder's equity | $14526 | $22465 | $24181 | $25897 | $27871 |
| Total Shares Outstanding |  | 1105000 | 1300000 | 1495000 | 1719250 |
| Foundation Shares |  | 50000 | 50000 | 50000 | 50000 |
| Equity to Assets | 9.94% | 14.6% | 15.5% | 16.4% | 17.5% |
| Equity to Tangiable Assets | 9.94% | 14.6% | 15.5% | 16.4% | 17.5% |

---

Conversion Valuation Appraisal Report Page 59

Exhibit 3. Pro Forma Analysis Sheet

---

| | | | |
|:---|:---|:---|:---|
| Valuation Parameters |  |  |  |
| Prior Twelve Months Ended | Y |  |  |
| Period Ended September 30, 2022 |  | $944 | (1) |
| Pre-Conversion Book Value | B |  |  |
| As of September 30, 2022 |  | $14056 |  |
| Pre-Conversion Assets | A |  |  |
| As of September 30, 2022 |  | $152883 |  |
| Return on Money | R | 3.95 | % (2) |
| Conversion Expenses |  | $1750 |  |
|  | X | 13.46 | % (3) |
| Proceeds Not Invested |  | $1620 | (4) |
| Estimated ESOP Borrowings |  | $1080 |  |
| ESOP Purchases | E | 8.00 | % (5) |
| Cost of ESOP Borrowings |  | $72 | (5) |
| Cost of ESOP Borrowings | S | 0.00 | % (5) |
| Amort of ESOP Borrowings | T | 15 Years |  |
| Amort of MRP Amount | N | 5 Years |  |
| Estimated MRP Amount |  | $540 | (6) |
| MRP Purchases | M | 4.00 | % |
| MRP Expense |  | $108 |  |
| Stock Foundation Amount |  | $500 | (7) |
| Stock Foundation Amount | F | 3.85% 0.00 | % |
| Foundation Opportunity Cost |  | $20 |  |
| Tax Benefit | Z | $105 | (8) |
| Tax Rate | TAX | 21.00 | % |
| Percentage Sold | PCT | 100.00 | % |
| Amount to be issued to Public |  | $13000 | (9) |
| Earnings Multiple |  | 12 |  |

---

---

| |
|:---|
| (1) Net income for the 12 months ended September 30, 2022. |
| (2) Net Return assumes a reinvestment rate of 5.00 percent (the 1 year Treasury at September 30, 2022), and a tax rate of 21%. |
| (3) Conversion expenses reflect estimated expenses as presented in the offering document. |
| (4) Includes Stock from ESOP and MRP. |
| (5) Assumes ESOP is amortized straight line over 15 years. |
| (6) Assumes MRP is amortized straight line over 5 years. |
| (7) The Foundation is assumed to be 4% of the gross proceeds. |
| (8) The after-tax benefit of the Foundation is assumed to be 21% of Foundation. |
| (9) The amount to be offered to public. |

---

---

| | | | |
|:---|:---|:---|:---|
|  |  |  | **Pro Forma Calculation** |
| Calculation of Estimated Value (V) at Midpoint Value | Calculation of Estimated Value (V) at Midpoint Value | Calculation of Estimated Value (V) at Midpoint Value |  |
| 3. | V= | <u>P/E\*Y</u> | $13000000 |
|  | 1-P/E\*PCT\*((1-X-E-M-F)\*R-(1-TAX)\*E/T-(1-TAX)\*M/N) | 1-P/E\*PCT\*((1-X-E-M-F)\*R-(1-TAX)\*E/T-(1-TAX)\*M/N) |  |
| 2. | V= | <u>P/B\*(B+Z)</u> | $13000000 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1-P/B\*PCT\*(1-X-E-M-F) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1-P/B\*PCT\*(1-X-E-M-F) |  |
| 1. | V= | <u>P/A\*A</u> | $13000000 |
|  | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1-P/A\*PCT\*(1-X-E-M-F) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1-P/A\*PCT\*(1-X-E-M-F) |  |

---

The appraisal was performed on a market basis and not on the above formulas.

---

| | | | |
|:---|:---|:---|:---|
|  | Total Shares | Price | Total |
| Conclusion | Shares | Per Share | Value |
| Appraised Value - Midpoint | 1300000 | $10.00 | $13000000 |
| Range: |  |  |  |
| &nbsp;&nbsp;&nbsp;-Minimum | 1105000 | $10.00 | 11050000 |
| &nbsp;&nbsp;&nbsp;- Maximum | 1495000 | 10.00 | 14950000 |
| &nbsp;&nbsp;&nbsp;- Super Maximum | 1719250 | 10.00 | 17192500 |

---

Conversion Valuation Appraisal Report Page 60

Exhibit 4. Pro Forma Effect of Conversion

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | | **Pro Forma Effect of Conversion Proceeds** | **Pro Forma Effect of Conversion Proceeds** | **Pro Forma Effect of Conversion Proceeds** | **Pro Forma Effect of Conversion Proceeds** |
|  | | **As of September 30, 2022** | **As of September 30, 2022** | **As of September 30, 2022** | **As of September 30, 2022** |
|  | | **(Dollars in Thousands)** | **(Dollars in Thousands)** | **(Dollars in Thousands)** | **(Dollars in Thousands)** |
| Conversion Proceeds |  | Minimum | Midpoint | Maximum | SuperMax |
| Total Shares Offered |  | 1105000 | 1300000 | 1495000 | 1719250 |
| Conversion Shares Offered |  | 1105000 | 1300000 | 1495000 | 1719250 |
| Price Per Share |  | $10 | $10 | $10 | $10 |
| Gross Proceeds |  | $11050 | $13000 | $14950 | $17193 |
| Plus: Value issued to Foundation | (9) | 500 | 500 | 500 | 500 |
| Pro Forma Market Capitalization |  | 11550 | 13500 | 15450 | 17693 |
| Gross Proceeds |  | 11050 | 13000 | 14950 | 17193 |
| Less: Est. Conversion Expenses |  | (1750) | (1750) | (1750) | (1750) |
| Net Proceeds |  | 9300 | 11250 | 13200 | 15443 |
| Less: Cash issued to Foundation |  | (100) | (100) | (100) | (100) |
| Less: ESOP Adjustment | (3) | (924) | (1080) | (1236) | (1415) |
| Less: MRP Adjustment | (3) | (462) | (540) | (618) | (708) |
| Net Proceeds Reinvested |  | $7814 | $9530 | $11246 | $13220 |
| Estimated Incremental Rate of Return |  | 3.95% | 3.95% | 3.95% | 3.95% |
| Estimated Incremental Return |  | $309 | $376 | $444 | $522 |
| Less: Cost of ESOP | (4) |  |  |  |  |
| Less: Amortization of ESOP | (7) | (49) | (57) | (65) | (75) |
| Less: Option Expense | (10) | (86) | (100) | (115) | (132) |
| Less: MRP Adjustment | (7) | (73) | (85) | (98) | (112) |
| Pro Forma Net Income |  | 101 | 134 | 166 | 203 |
| Earnings Before Conversion |  | 1314 | 1314 | 1314 | 1314 |
| Earnings Excluding Adjustment |  | 1415 | 1448 | 1480 | 1517 |
| Earnings Adjustment | (6) | - | - | - | - |
| Earnings After Conversion |  | $1415 | $1448 | $1480 | $1517 |

---

Conversion Valuation Appraisal Report Page 61

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | | **Pro Forma Effect of Conversion Proceeds** | **Pro Forma Effect of Conversion Proceeds** | **Pro Forma Effect of Conversion Proceeds** | **Pro Forma Effect of Conversion Proceeds** |
|  | | **As of September 30, 2022** | **As of September 30, 2022** | **As of September 30, 2022** | **As of September 30, 2022** |
|  | | **(Dollars in Thousands)** | **(Dollars in Thousands)** | **(Dollars in Thousands)** | **(Dollars in Thousands)** |
|  | | Minimum | Midpoint | Maximum | SuperMax |
| Pro Forma Equity |  |  |  |  |  |
| Equity at September 30, 2022 |  | $14526 | $14526 | $14526 | $14526 |
| Net Conversion Proceeds |  | 9300 | 11250 | 13200 | 15443 |
| Plus: Value issued to Foundation |  | 500 | 500 | 500 | 500 |
| Less: After Tax Expense of Foundation |  | (474) | (474) | (474) | (474) |
| Less: ESOP Adjustment | (1) | (924) | (1080) | (1236) | (1415) |
| Less: MRP Adjustment | (2) | (462) | (540) | (618) | (708) |
| Pro Forma Equity |  | $22466 | $24182 | $25898 | $27872 |
| Less: Intangible | (5) | - | - | - | - |
| Pro Forma Tangible Equity |  | $22466 | $24182 | $25898 | $27872 |
| Pro Forma Assets |  |  |  |  |  |
| Total Assets at September 30, 2022 |  | $146190 | $146190 | $146190 | $146190 |
| Net Conversion Proceeds |  | 9300 | 11250 | 13200 | 15443 |
| Plus: Value issued to Foundation |  | 500 | 500 | 500 | 500 |
| Less: After Tax Expense of Foundation |  | (474) | (474) | (474) | (474) |
| Less: ESOP Adjustment | (1) | (924) | (1080) | (1236) | (1415) |
| Less: MRP Adjustment | (2) | (462) | (540) | (618) | (708) |
| Pro-forma Total Assets |  | 154130 | 155846 | 157562 | 159536 |
| Stockholder's Equity Per Share \* |  |  |  |  |  |
| Equity at September 30, 2022 |  | $12.58 | $10.76 | $9.40 | $8.21 |
| Estimated Net Proceeds |  | 8.05 | 8.33 | 8.54 | 8.73 |
| Plus: Value issued to Foundation |  | 0.43 | 0.37 | 0.32 | 0.28 |
| Less: After Tax Expense of Foundation |  | (0.41) | (0.35) | (0.31) | (0.27) |
| Less: ESOP Stock |  | (0.80) | (0.80) | (0.80) | (0.80) |
| Less: MRP Stock |  | (0.40) | (0.40) | (0.40) | (0.40) |
| Pro Forma Equity Per Share \* |  | 19.45 | 17.91 | 16.76 | 15.75 |
| Less: Intangible |  | - | - | - | - |
| Pro Forma Tangible Equity Per Share \* |  | $19.45 | $17.91 | $16.76 | $15.75 |

---

Conversion Valuation Appraisal Report Page 62

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | | **Pro Forma Effect of Conversion Proceeds** | **Pro Forma Effect of Conversion Proceeds** | **Pro Forma Effect of Conversion Proceeds** | **Pro Forma Effect of Conversion Proceeds** |
|  | | **As of September 30, 2022** | **As of September 30, 2022** | **As of September 30, 2022** | **As of September 30, 2022** |
|  | | **(Dollars in Thousands)** | **(Dollars in Thousands)** | **(Dollars in Thousands)** | **(Dollars in Thousands)** |
|  | | Minimum | Midpoint | Maximum | SuperMax |
| Net Earnings Per Share \* |  |  |  |  |  |
| Historical Earnings Per Share | (8) | $1.23 | $1.05 | $0.92 | $0.80 |
| Incremental return Per Share | (8) | 0.29 | 0.30 | 0.31 | 0.32 |
| ESOP Adjustment Per Share | (8) | (0.05) | (0.05) | (0.05) | (0.05) |
| Option Expense Per Share | (10) | (0.08) | (0.08) | (0.08) | (0.08) |
| MRP Adjustment Per Share | (8) | (0.07) | (0.07) | (0.07) | (0.07) |
| Normalizing Adjustment Per Share |  | - | - | - | - |
| Pro Forma Earnings Per Share \* | (8) | $1.32 | $1.16 | $1.04 | $0.93 |
| Shares Utilized for EPS |  | 1068760 | 1249200 | 1429640 | 1637146 |
| Pro Forma Ratios |  |  |  |  |  |
| Price/EPS without Adjustment |  | 7.58 | 8.62 | 9.62 | 10.75 |
| Price/EPS with Adjustment |  | 7.58 | 8.62 | 9.62 | 10.75 |
| Price/Book Value per Share |  | 51.41% | 55.83% | 59.67% | 63.49% |
| Price/Tangible Book Value |  | 51.41% | 55.83% | 59.67% | 63.49% |
| Market Value/Assets |  | 7.49% | 8.66% | 9.81% | 11.09% |

---

\* The totals for the per share data are actual figures rounded to two decimals. The component parts may not add to the total due to rounding.

(1) ESOP Borrowings are deducted from net worth and assets, and amortized over 15 years.

(2) MRP Borrowings are omitted from net worth and assets, and amortized over 5 years.

(3) Consists of ESOP and MRP amortization.

(4) The ESOP loan is from the Holding Company and therefore, there are no costs.

(5) Not applicable.

(6) Not applicable.

(7) ESOP and MRP are amortized over 15 and 5 years respectively, and tax impacted at 21%.

(8) All EPS computations are done in accordance with SOP 93-6.

(9) The Foundation is assumed to be 4% of the gross proceeds.

(10) Assumed option expense in accordance with SFAS No. 123.

Conversion Valuation Appraisal Report Page 63

Exhibit 5. Comparison of Valuation with and without Foundation

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | At the minimum | At the minimum | At the midpoint | At the midpoint | At the maximum | At the maximum | At the maximum, as adjusted | At the maximum, as adjusted |
|  | With <br> Foundation | No<br> Foundation | W/Found <br> (1) | No<br> Foundation | With<br> Foundation | No<br> Foundation | With<br> Foundation | No<br> Foundation |
| Estimated Offering Amount | $11050 | $11050 | $13000 | $13000 | $14950 | $14950 | $17193 | $17193 |
| Pro forma Market Capitalization | $11550 | $11050 | $13500 | $13000 | $15450 | $14950 | $17693 | $17193 |
| Total Assets | $154130 | $154164 | $155846 | $155880 | $157562 | $157596 | $159536 | $159570 |
| Total Liabilities | $131664 | $131664 | $131664 | $131664 | $131664 | $131664 | $131664 | $131664 |
| Pro forma stockholders Equity | $22466 | $22500 | $24182 | $24216 | $25898 | $25932 | $27872 | $27906 |
| Pro forma consolidated net earnings | $1415 | $1430 | $1448 | $1463 | $1480 | $1497 | $1517 | $1534 |
| Pro forma stockholders equity per share | $19.45 | $20.36 | $17.91 | $18.63 | $16.76 | $17.35 | $15.75 | $16.23 |
| Pro forma consolidated net earnings per share | $1.32 | $1.40 | $1.16 | $1.22 | $1.04 | $1.08 | $0.93 | $0.96 |
| Pro forma pricing ratios |  |  |  |  |  |  |  |  |
| Offering price as a % of pro forma |  |  |  |  |  |  |  |  |
| stockholders equity per share | 51.41% | 49.12% | 55.83% | 53.68% | 59.67% | 57.64% | 63.49% | 61.61% |
| Offering price to pro forma |  |  |  |  |  |  |  |  |
| net earnings per share | 7.58 | 7.14 | 8.62 | 8.20 | 9.62 | 9.26 | 10.75 | 10.42 |
| Offering price to assets | 7.49% | 7.17% | 8.66% | 8.34% | 9.81% | 9.49% | 11.09% | 10.77% |
| Pro forma Financial Ratios |  |  |  |  |  |  |  |  |
| ROA | 0.92% | 0.93% | 0.93% | 0.94% | 0.94% | 0.95% | 0.95% | 0.96% |
| ROE | 6.30% | 6.36% | 5.99% | 6.04% | 5.71% | 5.77% | 5.44% | 5.50% |
| Equity to Assets | 14.58% | 14.59% | 15.52% | 15.54% | 16.44% | 16.45% | 17.47% | 17.49% |

---

Conversion Valuation Appraisal Report Page 64

Exhibit 6. Use of Proceeds

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | 1105000 | % of Gross | 1300000 | Gross | 1495000 | Gross | 1719250 | Gross |
| **Use of Proceeds** | Shares | Proceeds | Shares | Proceeds | Shares | Proceeds | Shares | Proceeds |
| Gross Offering Proceeds | $11050 |  | $13000 |  | $14950 |  | $17193 |  |
| Less: Expense | (1750) |  | (1750) |  | (1750) |  | (1750) |  |
| Net Proceeds | 9300 | 100.0% | 11250 | 100.0% | 13200 | 100.0% | 15443 | 100.0% |
| Less: |  |  |  |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Proceeds to Bank | (4650) | -50.0% | (5625) | -50.0% | (6600) | -50.0% | (7722) | -50.0% |
| &nbsp;&nbsp;&nbsp;ESOP | (924) | -9.9% | (1080) | -9.6% | (1236) | -9.4% | (1415) | -9.2% |
| &nbsp;&nbsp;&nbsp;Cash to Foundation | (100) | -1.1% | (100) | -0.9% | (100) | -0.8% | (100) | -0.7% |
| Proceeds for HC | 3626 | 39.0% | 4445 | 39.5% | 5264 | 39.9% | 6206 | 40.2% |

---

Conversion Valuation Appraisal Report Page 65

Exhibit 7. Pro-forma As of September 2022

---

| | | | |
|:---|:---|:---|:---|
| Valuation Parameters |  |  |  |
| Prior Twelve Mos. Earning Base | Y |  |  |
| Period Ended September 30, 2022 |  | $944 | (1) |
| Pre-Conversion Book Value | B |  |  |
| As of September 30, 2022 |  | $14056 |  |
| Pre-Conversion Assets | A |  |  |
| As of September 30, 2022 |  | $152883 |  |
| Return on Money | R | 3.20% | (2) |
| Conversion Expenses |  | $1750 |  |
|  | X | 13.46% | (3) |
| Proceeds Not Invested |  | $1620 | (4) |
| Estimated ESOP Borrowings |  | $1080 |  |
| ESOP Purchases | E | 8.00% | (5) |
| Cost of ESOP Borrowings |  | $72 | (5) |
| Cost of ESOP Borrowings | S | 0.00% | (5) |
| Amort of ESOP Borrowings | T | 15 | Years |
| Amort of MRP Amount | N | 5 | Years |
| Estimated MRP Amount |  | $540 | (6) |
| MRP Purchases | M | 4.00% |  |
| MRP Expense |  | $108 |  |
| Stock Foundation Amount |  | $500 | (7) |
| Stock Foundation Amount | F | 3.85% | 0.00% |
| Foundation Opportunity Cost |  | $16 |  |
| Tax Benefit | Z | $105 | (8) |
| Tax Rate | TAX | 21.00% |  |
| Percentage Sold | PCT | 100.00% |  |
| Amount to be issued to Public |  | $13000 | (9) |
| Earnings Multiple |  | 12 |  |

---

---

| |
|:---|
| (1) Net income for the twelve months ended September 30, 2022. |
| (2) Net Return assumes a reinvestment rate of 5.00 percent (the 1 year Treasury at September 30, 2022), and a tax rate of 21%. |
| (3) Conversion expenses reflect estimated expenses as presented in the offering document. |
| (4) Includes Stock from ESOP and MRP. |
| (5) Assumes ESOP is amortized straight line over 15 years. |
| (6) Assumes MRP is amortized straight line over 5 years. |
| (7) The Foundation is assumed to be 4% of the gross proceeds. |
| (8) The after-tax benefit of the Foundation is assumed to be 21% of Foundation. |
| (9) The amount to be offered to public. |

---

---

| | | |
|:---|:---|:---|
| | | **Pro Forma Calculation** |
| Calculation of Estimated Value (V) at Midpoint Value | Calculation of Estimated Value (V) at Midpoint Value |  |
| 3. | V= <u>P/E\*Y</u> | $13000000 |
|  | 1-P/E\*PCT\*((1-X-E-M-F)\*R-(1-TAX)\*E/T-(1-TAX)\*M/N) |  |
| 2. | V= <u>P/B\*(B+Z)</u> | $13000000 |
|  | 1-P/B\*PCT\*(1-X-E-M-F) |  |
| 1. | V= <u>P/A\*A</u> | $13000000 |
|  | 1-P/A\*PCT\*(1-X-E-M-F) |  |

---

The appraisal was performed on a market basis and not on the above formulas.

---

| | | | |
|:---|:---|:---|:---|
|  | Total Shares | Price | Total |
| Conclusion | Shares | Per Share | Value |
| Appraised Value - Midpoint | 1300000 | $10.00 | $13000000 |
| Range: |  |  |  |
| &nbsp;&nbsp; - Minimum | 1105000 | $10.00 | 11050000 |
| &nbsp;&nbsp; - Maximum | 1495000 | 10.00 | 14950000 |
| &nbsp;&nbsp; - Super Maximum | 1719250 | 10.00 | 17192500 |

---

Conversion Valuation Appraisal Report Page 66

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Pre Foundation** | **Pre Foundation** | **Pre Foundation** | **Pre Foundation** |
|  | Appraised Value | Appraised Value | Appraised Value | Appraised Value |
| Conclusion | Minimum | Midpoint | Maximum | SuperMaximum \* |
| Total Shares | 1105000 | 1300000 | 1495000 | 1719250 |
| Price per Share | $10 | $10 | $10 | $10 |
| Full Conversion Value | $11050000 | $13000000 | $14950000 | $17192500 |
| Conversion Shares | 1105000 | 1300000 | 1495000 | 1719250 |
| Conversion Percent | 100.00% | 100.00% | 100.00% | 100.00% |
| Gross Proceeds | $11050000 | $13000000 | $14950000 | $17192500 |

---

\* SuperMaximum is an overallotment option that is 15% above the maximum amount.

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | | **Pro Forma Effect of Conversion Proceeds** | **Pro Forma Effect of Conversion Proceeds** | **Pro Forma Effect of Conversion Proceeds** | **Pro Forma Effect of Conversion Proceeds** |
|  | | **As of September 30, 2022** | **As of September 30, 2022** | **As of September 30, 2022** | **As of September 30, 2022** |
|  | | **(Dollars in Thousands)** | **(Dollars in Thousands)** | **(Dollars in Thousands)** | **(Dollars in Thousands)** |
| Conversion Proceeds |  | Minimum | Midpoint | Maximum | SuperMax |
| Total Shares Offered |  | 1105000 | 1300000 | 1495000 | 1719250 |
| Conversion Shares Offered |  | 1105000 | 1300000 | 1495000 | 1719250 |
| Price Per Share |  | $10 | $10 | $10 | $10 |
| Gross Proceeds |  | $11050 | $13000 | $14950 | $17193 |
| Plus: Value issued to Foundation | (9) | 500 | 500 | 500 | 500 |
| Pro Forma Market Capitalization |  | 11550 | 13500 | 15450 | 17693 |
| Gross Proceeds |  | 11050 | 13000 | 14950 | 17193 |
| Less: Est. Conversion Expenses |  | (1750) | (1750) | (1750) | (1750) |
| Net Proceeds |  | 9300 | 11250 | 13200 | 15443 |
| Less: Cash issued to Foundation |  | (100) | (100) | (100) | (100) |
| Less: ESOP Adjustment | (3) | (924) | (1080) | (1236) | (1415) |
| Less: MRP Adjustment | (3) | (462) | (540) | (618) | (708) |
| Net Proceeds Reinvested |  | $7814 | $9530 | $11246 | $13220 |
| Estimated Incremental Rate of Return |  | 3.20% | 3.20% | 3.20% | 3.20% |
| Estimated Incremental Return |  | $250 | $305 | $360 | $423 |
| Less: Cost of ESOP | (4) |  |  |  |  |
| Less: Amortization of ESOP | (7) | (49) | (57) | (65) | (75) |
| Less: Option Expense | (10) | (86) | (100) | (115) | (132) |
| Less: MRP Adjustment | (7) | (73) | (85) | (98) | (112) |
| Pro Forma Net Income |  | 42 | 63 | 82 | 104 |
| Earnings Before Conversion |  | 944 | 944 | 944 | 944 |
| Earnings Excluding Adjustment |  | 986 | 1007 | 1026 | 1048 |
| Earnings Adjustment | (6) | - | - | - | - |
| Earnings After Conversion |  | $986 | $1007 | $1026 | $1048 |

---

Conversion Valuation Appraisal Report Page 67

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | | **Pro Forma Effect of Conversion Proceeds** | **Pro Forma Effect of Conversion Proceeds** | **Pro Forma Effect of Conversion Proceeds** | **Pro Forma Effect of Conversion Proceeds** |
|  | | **As of September 30, 2022** | **As of September 30, 2022** | **As of September 30, 2022** | **As of September 30, 2022** |
|  | | **(Dollars in Thousands)** | **(Dollars in Thousands)** | **(Dollars in Thousands)** | **(Dollars in Thousands)** |
|  | | Minimum | Midpoint | Maximum | SuperMax |
| Pro Forma Equity |  |  |  |  |  |
| Equity at September 30, 2022 |  | $14056 | $14056 | $14056 | $14056 |
| Net Conversion Proceeds |  | 9300 | 11250 | 13200 | 15443 |
| Plus: Value issued to Foundation |  | 500 | 500 | 500 | 500 |
| Less: After Tax Expense of Foundation |  | (474) | (474) | (474) | (474) |
| Less: ESOP Adjustment | (1) | (924) | (1080) | (1236) | (1415) |
| Less: MRP Adjustment | (2) | (462) | (540) | (618) | (708) |
| Pro Forma Equity |  | $21996 | $23712 | $25428 | $27402 |
| Less: Intangible | (5) | - | - | - | - |
| Pro Forma Tangible Equity |  | $21996 | $23712 | $25428 | $27402 |
| Pro Forma Assets |  |  |  |  |  |
| Total Assets at September 30, 2022 |  | $152883 | $152883 | $152883 | $152883 |
| Net Conversion Proceeds |  | 9300 | 11250 | 13200 | 15443 |
| Plus: Value issued to Foundation |  | 500 | 500 | 500 | 500 |
| Less: After Tax Expense of Foundation |  | (474) | (474) | (474) | (474) |
| Less: ESOP Adjustment | (1) | (924) | (1080) | (1236) | (1415) |
| Less: MRP Adjustment | (2) | (462) | (540) | (618) | (708) |
| Pro-forma Total Assets |  | 160823 | 162539 | 164255 | 166229 |
| Stockholder's Equity Per Share \* |  |  |  |  |  |
| Equity at September 30, 2022 |  | $12.17 | $10.41 | $9.10 | $7.94 |
| Estimated Net Proceeds |  | 8.05 | 8.33 | 8.54 | 8.73 |
| Plus: Value issued to Foundation |  | 0.43 | 0.37 | 0.32 | 0.28 |
| Less: After Tax Expense of Foundation |  | (0.41) | (0.35) | (0.31) | (0.27) |
| Less: ESOP Stock |  | (0.80) | (0.80) | (0.80) | (0.80) |
| Less: MRP Stock |  | (0.40) | (0.40) | (0.40) | (0.40) |
| Pro Forma Equity Per Share \* |  | 19.04 | 17.56 | 16.46 | 15.49 |
| Less: Intangible |  | - | - | - | - |
| Pro Forma Tangible Equity Per Share \* |  | $19.04 | $17.56 | $16.46 | $15.49 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | | **Pro Forma Effect of Conversion Proceeds** | **Pro Forma Effect of Conversion Proceeds** | **Pro Forma Effect of Conversion Proceeds** | **Pro Forma Effect of Conversion Proceeds** |
|  | | **As of September 30, 2022** | **As of September 30, 2022** | **As of September 30, 2022** | **As of September 30, 2022** |
|  | | **(Dollars in Thousands)** | **(Dollars in Thousands)** | **(Dollars in Thousands)** | **(Dollars in Thousands)** |
|  | | Minimum | Midpoint | Maximum | SuperMax |
| Net Earnings Per Share \* |  |  |  |  |  |
| Historical Earnings Per Share | (8) | $0.88 | $0.76 | $0.66 | $0.58 |
| Incremental return Per Share | (8) | 0.23 | 0.24 | 0.25 | 0.26 |
| ESOP Adjustment Per Share | (8) | (0.05) | (0.05) | (0.05) | (0.05) |
| Option Expense Per Share | (10) | (0.08) | (0.08) | (0.08) | (0.08) |
| MRP Adjustment Per Share | (8) | (0.07) | (0.07) | (0.07) | (0.07) |
| Normalizing Adjustment Per Share |  | - | - | - | - |
| Pro Forma Earnings Per Share \* | (8) | $0.92 | $0.81 | $0.72 | $0.64 |
| Shares Utilized for EPS |  | 1068760 | 1249200 | 1429640 | 1637146 |
| Pro Forma Ratios |  |  |  |  |  |
| Price/EPS without Adjustment |  | 10.87 | 12.35 | 13.89 | 15.63 |
| Price/EPS with Adjustment |  | 10.87 | 12.35 | 13.89 | 15.63 |
| Price/Book Value per Share |  | 52.52% | 56.95% | 60.75% | 64.56% |
| Price/Tangible Book Value |  | 52.52% | 56.95% | 60.75% | 64.56% |
| Market Value/Assets |  | 7.18% | 8.31% | 9.41% | 10.64% |

---

\* The totals for the per share data are actual figures rounded to two decimals. The component parts may not add to the total due to rounding.

(1) ESOP Borrowings are deducted from net worth and assets, and amortized over 15 years.

(2) MRP Borrowings are omitted from net worth and assets, and amortized over 5 years.

(3) Consists of ESOP and MRP amortization.

(4) The ESOP loan is from the Holding Company and therefore, there are no costs.

(5) Not applicable.

(6) Not applicable.

(7) ESOP and MRP are amortized over 15 and 5 years respectively, and tax impacted at 21%.

(8) All EPS computations are done in accordance with SOP 93-6.

(9) The Foundation is assumed to be 4% of the gross proceeds.

(10) Assumed option expense in accordance with SFAS No. 123.

## Ex-Filing

**EX-FILING FEES**

**Calculation of Filing Fee Tables**

**Form S-1**

(Form Type)

**Mercer Bancorp, Inc.**

(Exact Name of Registrant as Specified in its Charter)

<u>Table 1: Newly Registered Securities</u>

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
| | Security Type | Security Class Title | Fee Calculation Rule | Amount Registered | Proposed Maximum Aggregate Offering Price Per Unit | Maximum Aggregate Offering Price (1) | Fee Rate | Amount of <br> Registration Fee |
| Fees to be paid | Equity | Common stock, $0.01 par value per share | Rule 457(a) | 1769250 | $10.00 | $17692500 | 0.00011020 | $1950 |
|  | Total Offering Amounts | Total Offering Amounts | Total Offering Amounts | Total Offering Amounts |  | $17692500 |  | $1950 |
|  | Total Fees Previously Paid | Total Fees Previously Paid | Total Fees Previously Paid | Total Fees Previously Paid |  |  |  | $0 |
|  | Total Fee Offsets | Total Fee Offsets | Total Fee Offsets | Total Fee Offsets |  |  |  | ̶ |
|  | Net Fee Due | Net Fee Due | Net Fee Due | Net Fee Due |  |  |  | $1950 |

---

&nbsp;&nbsp;&nbsp;&nbsp;(1) Estimated solely for the purpose of calculating the registration
fee.