Mid Penn Bancorp

ITEM 1A RISK FACTORS

Management has reviewed the risk factors that were The section titled Risk Factors in Part I, Item 1A of Mid Penns 2024 Annual Report included a discussion of the many risks and uncertainties Mid Penn faces, any one or more of which could have a material adverse effect on its business, results of operations, financial condition (including capital and liquidity), prospects, or the value of or return on an investment in Mid Penn. The information previously disclosesented below provides an update to, and should be read in conjunction with the risk factors and other information contained in the Part I, Item 1A of Mid Penns 2024 Annual Report and subsequentthose added to Mid Penns quarterly reports filed with ton Form 10-Q for the quarters ended March 31, 2025 and June 30, 2025.

As a result of Mid Penn entering into the SEC to determine if there wereMerger Agreement with 1st Colonial, certain risk factors have been identified:

The Merger Agreement may be terminated in accordance with its terms and the Merger material changes y not be completed.

The Merger Agreement is subject to a number of conditions which must be fulfilled in order to complete the Merger. Those conditions include, among other things: (i) applicable to roval and adoption of the Merger Agreement by 1st Colonials shareholders; (ii) the receipt of required regulatory approvals, including the approval of the Board of Governors of the six months ended June 30, 2025. Aside from Federal Reserve System, the Federal Deposit Insurance Corporation, the Pennsylvania Department of Banking and Securities and the New Jersey Department of Banking and Insurance; and (iii) the absence of any order, injunction or decree prohibiting or making illegal the following risk factorconsummation of the Merger. Each partys obligation to complete the Merger is also subject to certain additional customary conditions, including (a) subject to certain exceptions, there have been no ma accuracy of the representations and warranties of the other party, (b) performance in all material changes to trespects by the other party of its obligations under the Merger Agreement, (c) receipt by such party of an opinion from its counsel to the risk factors that were previously disclosed ineffect that the Merger will qualify as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended, and (d) the absence of a material adverse effect with respect to the other party since the execution of the Merger Agreement.

These conditions to the closing of the Merger may not be fulfilled in a timely manner or at all, and, accordingly, the Merger may not be completed. In addition, the parties can mutually decide to terminate the 2024 AnnuMerger Agreement at any time, before or after the requisite 1st Colonial Reportshareholder approval, or Mid Penn or 1st Colonial may elect to terminate the Merger Agreement in certain other circumstances.

Changes in financial regulaRegulatory approvals may not be received, may take longer than expected, or may impose conditions that are not presently anticipated or that could have an adverse effect on the combined company following the Merger.

Before the Merger and the Bank Merger may be completed, various approvals, consents and non-objections and economic pomust be obtained from the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the

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Pennsylicivania Department of Banking and Securities under the current U.S. adand the New Jersey Department of Banking and Insurance, and other regulatory authorities in the United States. In deterministration may impact our business operations, compliance costng whether to grant these approvals, such regulatory authorities consider a variety of factors, including the regulatory standing of each party. These approvals could be delayed or not obtained at all, including due to an adverse development in either partys regulatory standing or in any other factors considered by regulators when granting such approvals; governmental, political, or community group inquiries, investigations, or opposition; or changes in legislation or the political environment generally.

The approvals that are granted may impose terms and conditions, limitations, and profitability.

obligations, or costs, or place restrictions on the conduct of the combined companys business or require changes to the terms of the transactions contemplated by the Merger Agreement. The current administration's policies re can be no assurance that regulators will not impose any such conditions, limitations, obligations, or restrictions and that such conditions, limitations, obligations, or restrictions will not have introducethe effect of delaying the completion of any of the transactions contemplated both opportunities and uncertaintiesy the Merger Agreement, imposing additional material costs on or materially limiting the revenues of the combined company following the Merger or otherwise reducing the anticipated benefits of the Merger if the Merger was consummated successfully within the expected timeframe. In addition, there can be no assurance that could materiany such conditions, terms, obligations, or restrictions will not result in the delay or abandonment of the Merger. Additionally affect our opera, the Merger is conditioned on the absence of any order, injunction or decree that enjoins or prohibits consummation of the transactions:

Deregul contemplated by the Merger Agreement.

Failure to complete the Merger could negation Efforts: The administravely impact Mid Penn.

If the Merger is not completed for any reason, including as a result of 1st Colonials shareholders failing to approve and adopt the Merger Agreement, there may be various adverse consequences, and Mid Penn may experience negative reaction has signaled intentions s from the financial markets and from its customers and employees. For example, Mid Penns business may have been impacted adversely by the failure to pursue other beneficial opportunities due to ease financithe focus of management on the Merger, without realizing any of the anticipated benefits of completing the Merger. Also, Mid Penn has devoted significant internal regulsources to the pursuit of the Merger and the expected benefit of those resource allocations, including potential modi would be lost if the Merger is not completed. Additionally, if the Merger Agreement is terminated, the market price of Mid Penns common stock could decline to the extent that current market prices reflect a market assumption that the Merger will be benefications to capital requirements and strial and will be completed.

Combining Mid Penn and 1st Colonial may be more difficult, costly, or time consuming than expected and the anticipated benefits and cost savings of the Merger may not be realized.

Mid Penn and 1st Colonial have operated and, until the completion of the Merger, will continue to operate independently. The success testof the Merger, including anticipated benefits and cost saving procedures. Whiles, will depend, in part, on Mid Penns ability to successfully combine and integrate the businesses of Mid Penn and 1st Colonial in a manner this may reduce complianceat permits growth opportunities and does not materially disrupt the existing customer relations nor result in decreased revenues due to loss of customers. It is possible that the integration process costs, it may also lead to increased competitionuld result in the disruption of either companys ongoing businesses or inconsistencies in standards, controls, procedures, and policies that adversely affect the combined companys ability to maintain relationships with clients, customers, depositors, and employees or to achieve the anticipated benefits and pressure on profit margins.

Trade Policies: Recent shifcost savings of the Merger. If Mid Penn experiences difficulties with the integration process, the anticipated benefits of the Merger may not be realized fully or at all, or may take longer to realize than expected. Integration efforts between the two companies will also divert management attention and resources. These integration matters could have an adverse effect on each of Mid Penn and 1st Colonial during this transition period and for an undetermined period after completion of the Merger on the combined company. An inability to realize the full extent of the anticipated benefits in trade policieof the Merger and the other transactions contemplated by the Merger Agreement, as well as any delays encountered in the integration process, could have an adverse effect upon the revenues, such as tlevels of expenses and operating results of Mid Penn following the completion of the Merger, which may adversely affect the ivalue of the common stock of Mid Penn following the complementation otion of the Merger.

The combined company may be unable to retain Mid Penn and/or 1st Colonial personnel successfully after the Merger is completed.

The success of tariffs on imports from key trading partnerhe Merger will depend in part on the combined companys ability to retain the talent and dedication of key employees currently employed by Mid Penn or 1st Colonial. It is possible that these employees may decide not to remain with Mid Penn or 1st Colonial, as applicable, while the Merger is pending or with the combined company after the Merger is consummated. If Mid Penn and 1st Colonial are unable to retain key employees, havincluding management, who are critical

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to theated volatilit successful integration and future operations of the companies, Mid Penn and 1st Colonial could face disruptions in their operations, loss of existing customers, loss of key in financial markets. This uncertainty could impact our customers' business operaformation, expertise or know-how and unanticipated additional recruitment costs. In addition, following the Merger, if key employees terminate their employment, the combined companys business activities may be adversely affected, and managements attention may be diverted from successfully hiring suitable replacements, all of which may cause the combined companys business to suffer. Mid Penn and 1st Colonial also may not be able to locate or retain suitable replacements for any key employees who leave either company.

Mid Penn has incurred and is expected to incur substantial costs related to the Merger.

Both Mid Penn and 1st Colonial will incur substantial expenses in connection with the negotiation and completion of the transactions, potentially affec contemplated by the Merger Agreement. These costs include legal, financial advisory, accounting their creditworthiness and demand f, consulting, and other advisory fees, retention, severance, and employee benefit-related costs, public company filing fees and other regulatory fees, financial printing and other printing costs, closing, integration and other related costs. Some of these costs are payable by Mid Penn regardless of whether or financing.

Tax Reforms: Proposnot the Merger is completed.

Mid Penn or 1st Colonial or both may be subject to claims and litigation pertaining to the Merger that could prevent or delay the completion of the Merger.

Any lawsuits filed in connection with the Merger could prevent or delay completion of the Merger and result in additional costs to Mid Penn and 1st Colonial, including any costs associated changes to corporate tax structuwith indemnification. The defense or settlement of any lawsuit or claim that may be filed seeking remedies against 1st Colonial, its board of directors or Mid Penn or its board of directors in connection with the Merger that remains unresolved at the effective time of the Merger may adversely affect Mid Penns business, financial condition, res may alter the finults of operations and cash flows.

The continuation of the U.S. federal government shutdown could adversely affect the U.S. and global economy and our business, financial landscape condition and results of operations.

Disagreement over the U.S. federal budget has caused the U.S. federal government to shut down in wrecent weeks, which we opermay continue for an indeterminate period of time. While lower taxes could enhance profitability, the long-term ee originate, sell and service loans under various programs sponsored by the U.S. federal government, including the SBA. Any inability to engage in our commercial SBA origination and servicing business would lead to a decrease in our net income. Additionally, an extended period of shutdown of portions of the U.S. federal government could negatively impact the financial performance of certain clients and could negatively impact our clients access to certain loan and guaranty programs. Prolonged adverse political and economic conditions could have a material adverse effects on t on our business, financial condition and results of operations.

The broader economy reother risk factors that could affect Mid Penns financial condition or operating results remain uncertain.

77hanged from those previously disclosed in Mid Penns 2024 Annual Report and Mid Penns quarterly reports on Form 10-Q for the quarters ended March 31, 2025 and June 30, 2025.

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