• the board’s view that William Penn, like Mid Penn, is focused on customer service and building relationships in local communities; • the deal protection provided by the terms of the merger agreement and the termination fee of $4,900,000 payable to Mid Penn under certain circumstances; • the results of Mid Penn’s due diligence examination of William Penn and its business operations, including asset quality and composition of its investment portfolio; • the opinion, dated October 31, 2024, of KBW to the Mid Penn board of directors as to the fairness, from a financial point of view and as of the date of the opinion, to Mid Penn of the exchange ratio in the merger, as more fully described below under “Opinion of Keefe, Bruyette & Woods, Inc. to Mid Penn’s Board of Directors;” and • the review by the board of directors with Pillar+Aught, Mid Penn’s legal advisor, of the structure of the merger and the financial and other terms of the merger agreement, including the fixed exchange ratio. The Mid Penn board of directors also considered potential risks relating to the merger, including the following: • the regulatory and other approvals required in connection with the merger and the expectation that such regulatory approvals will be received in a timely manner and without the imposition of unacceptable conditions; • the potential for diversion of management and employee attention, and for employee attrition, during the period prior to the completion of the merger and the potential effect on Mid Penn’s business and relations with customers, service providers and other stakeholders, whether or not the merger is completed; • the expected benefits and synergies sought in the merger, including cost savings and Mid Penn’s ability to market successfully its financial products to William Penn’s customers, may not be realized or may not be realized within the expected time period; • the challenges of integrating the businesses, operations and employees of William Penn and Mid Penn; • the potential for William Penn to terminate the merger agreement if the price of Mid Penn common stock decreases as set forth in the merger agreement (subject to Mid Penn’s option to increase the exchange ratio in order to avoid termination); and • the other risks described in the section entitled “Risk Factors” beginning on page 39. The foregoing discussion of the information and factors considered by Mid Penn’s board of directors is not exhaustive, but includes the material factors considered by the board. In view of the wide variety of factors considered by the board of directors of Mid Penn in connection with its evaluation of the merger and the complexity of these matters, the board of directors did not consider it practical to, and did not attempt to, quantify, rank or otherwise assign relative weights to the specific factors that it considered in reaching its decision. Mid Penn’s board of directors evaluated the factors described above, including through its asking questions of Mid Penn’s legal and financial advisors. In considering the factors described above, individual members of Mid Penn’s board of directors may have given different weights to different factors. The board of directors relied on the experience and expertise of its legal advisors regarding the structure of the merger and the terms of the merger agreement and the experience and expertise of its financial advisor, Stephens, for quantitative analysis of the financial terms of the merger. It should also be noted that this explanation of the reasoning of Mid Penn’s board of directors and certain other information presented in this section are forwardlooking in nature and, therefore, should be read in light of the factors discussed under the heading “Cautionary Statement Regarding Forward-Looking Statements” on page 47. 71
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