The market price of Mid Penn shares of common stock after the merger may be affected by factors different from those currently affecting the shares of William Penn. The businesses of Mid Penn and William Penn differ and, accordingly, the results of operations of the combined company and the market price of the combined company’s shares of common stock may be affected by factors different from those currently affecting the independent results of operations of Mid Penn. For a discussion of the businesses of Mid Penn and William Penn, see “Information about Mid Penn” and “Information about William Penn” on pages 114 and 119, respectively. Future issuances of Mid Penn equity securities could dilute shareholder ownership and voting interest of Mid Penn shareholders. Mid Penn’s articles of incorporation currently authorize the issuance of up to forty million shares of common stock, which is the maximum number of shares Mid Penn may have issued and outstanding at any one time. Mid Penn’s ability to issue additional shares is reduced by the number of shares that are currently outstanding and already reserved for future issuances. Any future issuance of equity securities by Mid Penn may result in dilution in the percentage ownership and voting interest of Mid Penn shareholders. Also, any securities Mid Penn sells in the future may be valued differently and the issuance of equity securities for future services, acquisitions or other corporate actions may have the effect of diluting the value of shares held by Mid Penn shareholders. We may fail to realize all of the anticipated benefits of the merger. The success of the merger will depend, in part, on our ability to realize the anticipated benefits and cost savings from combining the businesses of Mid Penn and William Penn. However, to realize these anticipated benefits and cost savings, which include increased Mid Penn lending limits and access to stable core deposits, we must successfully combine the businesses of Mid Penn and William Penn. If we are not able to achieve these objectives, the anticipated benefits and cost savings of the merger may not be realized fully or at all, or may take longer to realize than expected. Mid Penn and William Penn have operated and, until the completion of the merger, will continue to operate, independently. It is possible that the integration process could result in the loss of key employees, the disruption of each company’s ongoing businesses or inconsistencies in standards, controls, procedures and policies that adversely affect our ability to maintain relationships with clients, customers, depositors and employees or to achieve the anticipated benefits of the merger. Integration efforts between the two companies will also divert management attention and resources. These integration matters could have an adverse effect on Mid Penn or William Penn during the transition period. Another expected benefit from the merger is an expected increase in the revenues of the combined company from anticipated sales of Mid Penn’s greater variety of financial products, and from increased lending out of Mid Penn’s substantially larger capital base, to William Penn’s existing customers and to new customers in William Penn’s market area who may be attracted by the combined company’s enhanced offerings. An inability to successfully market Mid Penn’s products to William Penn’s customer base could cause the earnings of the combined company to be less than anticipated. Unanticipated costs relating to the merger could reduce Mid Penn’s future earnings per share. Mid Penn and William Penn believe that they have reasonably estimated the likely incremental costs of the combined operations of Mid Penn and William Penn following the merger. However, it is possible that unexpected transaction costs such as taxes, fees or professional expenses or unexpected future operating expenses such as unanticipated costs to integrate the two businesses, increased personnel costs or increased taxes, as well as other types of unanticipated adverse developments, including negative changes in the value of William Penn’s loan portfolio, could have a material adverse effect on the results of operations and financial condition of Mid Penn following the merger. In addition, if actual costs are materially different than expected costs, the merger could have a significant dilutive effect on Mid Penn’s earnings per share. 45
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