S-4 1 midpenn-sx4.htm S-4 Document

As Filed with the Securities and Exchange Commission on February 21, 2023
Registration No. [l]
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
MID PENN BANCORP, INC.
(Exact name of Registrant as specified in its charter)
Pennsylvania602225-1666413
(State or other jurisdiction of
incorporation or organization)
(Primary Standard Industrial
Classification Code Number)
(IRS Employer
Identification No.)
2407 Park Drive
Harrisburg, Pennsylvania 17110
1.866.642.7736
(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)
Rory G. Ritrievi
President and Chief Executive Officer
Mid Penn Bancorp, Inc.
2407 Park Drive
Harrisburg, Pennsylvania 17110
(717) 692-7105
(Name, address, including zip code, and telephone number, including area code, of agent for service)
Copies to:
Kenneth J. Rollins, Esq.
Pillar Aught LLC
4201 E. Park Circle
Harrisburg, Pennsylvania 17111
(717) 308-9633
Robert A. Schwartz, Esq.
Windels Marx Lane & Mittendorf, LLP
120 Albany Street Plaza
New Brunswick, NJ 08901
(732) 448-2548
Approximate date of commencement of proposed sale of the securities to the public: As soon as practicable after this Registration Statement becomes effective and upon completion of the merger described in the enclosed document.
If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box.  o
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act of 1933, as amended (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.  o
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.  o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or 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
o
Accelerated filerx
Non-accelerated filer
o
Smaller reporting company
o
Emerging growth company
o
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.  o
If applicable, place an X in the box to designate the appropriate rule provision relied upon on conducting this transaction:
Exchange Act Rule 13e-4(i) (Cross-Border Issuer Tender Offer)  o
Exchange Act Rule 14d-1(d) (Cross Border Third-Party Tender Offer  o
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, as amended, or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.



The information in this joint proxy statement/prospectus is not complete and may be changed. We may not sell the securities offered by this joint proxy statement/prospectus until the registration statement filed with the Securities and Exchange Commission is effective. This joint proxy statement/prospectus shall not constitute an offer to sell or the solicitation of any offer to buy nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities law of any such jurisdiction.
PRELIMINARY JOINT PROXY STATEMENT/PROSPECTUS –
SUBJECT TO COMPLETION – DATED FEBRUARY 21, 2023
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Joint Proxy Statement/Prospectus
MERGER PROPOSED—YOUR VOTE IS VERY IMPORTANT
Dear Shareholder:
On December 20, 2022, Mid Penn Bancorp, Inc., or Mid Penn, and Brunswick Bancorp, or Brunswick, entered into a merger agreement under which Brunswick will merge with and into Mid Penn, with Mid Penn remaining as the surviving entity. Before we complete the merger, the shareholders of Mid Penn and Brunswick must approve and adopt the merger agreement.
Mid Penn shareholders will vote to adopt the merger agreement and on the other matters described below at a special meeting of shareholders to be held virtually via live webcast at 10:00 a.m. Eastern Time on April 25, 2023. Brunswick shareholders will vote to adopt the merger agreement and on the other matters described below at a special meeting of shareholders to be held virtually via live webcast at www.cleartrustonline.com/brunswick at 10:00 a.m., Eastern Time, on April 25, 2023. Information regarding how Mid Penn shareholders and Brunswick shareholders can attend and participate in their respective special meetings of shareholders is included in the proxy card for the respective companies included with this joint proxy statement/prospectus.
If the merger is completed, Brunswick shareholders will have the right to elect to receive, subject to adjustment and proration as described in the merger agreement, either (A) 0.598 shares of Mid Penn common stock or (B) Eighteen Dollars ($18.00), for each share of common stock they own. Cash will be paid in lieu of any fractional shares. The maximum number of shares of Mid Penn common stock estimated to be issuable upon completion of the merger is 915,851. Following the completion of the merger, former Brunswick shareholders will hold approximately 5.4% of Mid Penn’s common stock.
The common stock of Mid Penn trades on the Nasdaq Global Market under the symbol “MPB”. On December 19, 2022, which was the last trading date preceding the public announcement of the proposed merger, the closing price of Mid Penn common stock was Thirty Dollars and Ninety-Five cents ($30.95) per share. On February 16, 2023, the most recent practicable trading day prior to the printing of this joint proxy statement/prospectus, the closing price of Mid Penn common stock was Thirty-One Dollars and Seventeen Cents ($31.17) per share. The market price of Mid Penn common stock will fluctuate before the completion of the merger; therefore, you are urged to obtain current market quotations for Mid Penn common stock.
The Mid Penn board of directors has determined that the merger is advisable and in the best interests of Mid Penn and the Mid Penn board of directors unanimously recommends that the Mid Penn shareholders vote “FOR” the adoption of the merger agreement and “FOR” the approval of the other proposals described in this joint proxy statement/prospectus.
The Brunswick board of directors has determined that the merger is advisable and in the best interests of Brunswick and the Brunswick board of directors unanimously recommends that the Brunswick shareholders vote “FOR” the adoption of the merger agreement and “FOR” the approval of the other proposals described in this joint proxy statement/prospectus.
Your vote is very important. Whether or not you plan to virtually attend your shareholders’ meeting, please take the time to vote by completing and mailing the enclosed proxy card in accordance with the instructions on the proxy card. Mid Penn and Brunswick shareholders may also cast their votes over the Internet, by telephone or at the virtual meeting, in accordance with the instructions on the Mid Penn or Brunswick proxy card or voting instructions, as the case may be. We cannot complete the merger unless Mid Penn and Brunswick shareholders approve and adopt the merger agreement.
You should read this entire joint proxy statement/prospectus, including the annexes hereto and the documents incorporated by reference herein, carefully because it contains important information about the merger and the related transactions. In particular, you should read carefully the information under the section entitled “Risk Factors” beginning on page 24. You can also obtain information about Mid Penn from documents that it has filed with the Securities and Exchange Commission.
We strongly support this combination of our companies and join with the other members of our boards of directors in enthusiastically recommending that you vote in favor of the merger.
Rory G. RitrieviNicholas A. Frungillo
President and Chief Executive OfficerPresident and Chief Executive Officer
Mid Penn Bancorp, Inc.Brunswick Bancorp
The shares of Mid Penn common stock to be issued to Brunswick shareholders in the merger are not deposits or savings accounts or other obligations of any bank or savings association, and are not insured by the Federal Deposit Insurance Corporation or any other governmental agency.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved the Mid Penn common stock to be issued in the merger, or passed upon the adequacy or accuracy of this joint proxy statement/prospectus. Any representation to the contrary is a criminal offense.
The date of this joint proxy statement/prospectus is [l], 2023, and it is first being mailed or otherwise delivered to Mid Penn shareholders and Brunswick shareholders on or about [l], 2023.
This document incorporates important business and financial information about Mid Penn that is not included in or delivered with this document. This information is available without charge to shareholders of Mid Penn or Brunswick upon written or oral request at Mid Penn’s address and telephone number listed on page 107. To obtain timely delivery, shareholders must request the information no later than April 20, 2023, Please see “Where You Can Find More Information” on page 106 for instructions to request this and certain other information regarding Mid Penn and Brunswick.



MID PENN BANCORP, INC.
2407 PARK DRIVE
HARRISBURG, PENNSYLVANIA 17110
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON TUESDAY, APRIL 25, 2023
TO THE SHAREHOLDERS OF MID PENN BANCORP, INC.:
NOTICE IS HEREBY GIVEN that a special meeting of shareholders of Mid Penn Bancorp, Inc., or Mid Penn, will be held virtually via live webcast at 10:00 a.m. Eastern Time, on April 25, 2023, to consider and vote on:
1.a proposal to approve and adopt the Agreement and Plan of Merger, dated December 20, 2022 by and between Mid Penn and Brunswick Bancorp, or Brunswick, which provides for, among other things, the merger of Brunswick with and into Mid Penn (the “Mid Penn Merger Proposal”);
2.a proposal to amend Mid Penn’s Articles of Incorporation to increase the number of shares of authorized common stock, par value $1.00 per share, which Mid Penn has authority to issue from 20,000,000 shares to 40,000,000 shares (“Mid Penn Amendment Proposal 1”);
3.a proposal to amend Mid Penn’s Articles of Incorporation to limit the transactions in which Mid Penn’s shareholders shall be required to vote to those transactions required to be approved by the shareholders pursuant to the Pennsylvania Business Corporation Law or the rules and regulations of any national securities exchange on which Mid Penn’s securities are listed (“Mid Penn Amendment Proposal 2”); and
4.a proposal to authorize the board of directors to adjourn the special meeting, if necessary, to solicit additional proxies, in the event there are not sufficient votes at the time of the special meeting to approve the proposal to approve the merger agreement or the proposals to amend the articles (the “Mid Penn Adjournment Proposal”).
These items are described in more detail in the accompanying joint proxy statement/prospectus and its annexes. You should read these documents in their entirety before voting. We have fixed March 1, 2023 as the record date for determining those Mid Penn shareholders entitled to vote at the special meeting. Accordingly, only shareholders of record at the close of business on that date are entitled to notice of and to vote at the special meeting or any adjournment or postponement of the meeting.
Your board of directors has unanimously determined that the proposed merger is advisable and in the best interests of Mid Penn and unanimously recommends that you vote “FOR” the Mid Penn Merger Proposal. Your board of directors also recommends that you vote “FOR” Mid Penn Amendment Proposal 1, Mid Penn Amendment Proposal 2 and the Mid Penn Adjournment Proposal. In accordance with the terms of the merger agreement, each director and executive officer of Mid Penn has agreed to vote all shares of Mid Penn common stock owned by him or her that he or she, directly or indirectly, controls the right to vote and dispose of, in favor of the approval and adoption of the merger agreement and the transactions contemplated by the merger agreement.
Your vote is very important, regardless of the number of shares of Mid Penn common stock that you own. We cannot adopt the Mid Penn Merger Proposal or Mid Penn Amendment Proposal 2 unless at least sixty-six and two third percent (66 2/3%) of the outstanding shares of Mid Penn common stock votes for approval and we cannot adopt Mid Penn Amendment Proposal 1 or the Mid Penn Adjournment Proposal unless a majority of the votes cast at the special meeting vote for approval.
In order to attend and vote at the virtual special meeting, all shareholders must register at www.proxydocs.com/MPB by 12:00 p.m. Eastern Time on April 24, 2023. Upon completion of registration, you will receive further instructions via email that will provide you access to the special meeting. You must then attend the virtual special



meeting on April 25, 2023 at 10:00 a.m. Eastern Time and, if you want to vote, click on the “vote” link during the special meeting. Additional information regarding attending and voting at the virtual special meeting is provided in the proxy card included with this joint proxy statement/prospectus.
Even if you plan to virtually attend the special meeting (as noted above, information regarding how you can attend and participate in the special meeting is included in the proxy card), Mid Penn requests that you complete, sign, date and return, as promptly as possible, the enclosed proxy card in the accompanying prepaid reply envelope or submit your proxy by telephone or Internet prior to the special meeting to ensure that your shares of Mid Penn common stock will be represented at the special meeting. If you hold your shares in “street name” through a bank, brokerage firm or other nominee, you should follow the procedures provided by your bank, brokerage firm or other nominee to vote your shares. If you fail to submit a proxy or to virtually attend the special meeting and vote or do not provide your bank, brokerage firm or other nominee with instructions as to how to vote your shares, your shares of Mid Penn common stock will not be counted and will have the same effect as a vote “against” the approval and adoption the Mid Penn Merger Proposal and Mid Penn Amendment Proposal 2.
We urge you to vote as soon as possible so that your shares will be represented.
BY ORDER OF THE BOARD OF DIRECTORS,
/s/ Elizabeth Martin
Elizabeth Martin
Corporate Secretary
Harrisburg, Pennsylvania
[l], 2023



BRUNSWICK BANCORP
439 LIVINGSTON AVENUE
NEW BRUNSWICK, NEW JERSEY 08901
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON TUESDAY, APRIL 25, 2023
TO THE SHAREHOLDERS OF BRUNSWICK BANCORP:
NOTICE IS HEREBY GIVEN that a special meeting of shareholders of Brunswick Bancorp, or Brunswick, will be held virtually via live webcast at www.cleartrustonline.com/brunswick at 10:00 a.m., Eastern Time, on April 25, 2023, to consider and vote on:
1.a proposal to approve and adopt the Agreement and Plan of Merger, dated December 20, 2022 by and between Mid Penn Bancorp, Inc., or Mid Penn, and Brunswick, which provides for, among other things, the merger of Brunswick with and into Mid Penn (the “Brunswick Merger Proposal”); and
2.a proposal to authorize the board of directors to adjourn the Brunswick special meeting, if necessary, to solicit additional proxies, in the event there are not sufficient votes at the time of the Brunswick special meeting to approve the Brunswick Merger Proposal (the “Brunswick Adjournment Proposal”).
These items are described in more detail in the accompanying joint proxy statement/prospectus and its annexes. You should read these documents in their entirety before voting. We have fixed March 3, 2023 as the record date for determining those Brunswick shareholders entitled to vote at the special meeting. Accordingly, only shareholders of record at the close of business on that date are entitled to notice of and to vote at the special meeting or any adjournment or postponement of the meeting.
Your board of directors has unanimously determined that the proposed merger is advisable and in the best interests of Brunswick and unanimously recommends that you vote “FOR” the Brunswick Merger Proposal and “FOR” the Brunswick Adjournment Proposal. In accordance with the terms of the merger agreement, each director and executive officer and certain ten percent (10%) shareholders of Brunswick identified in the merger agreement have agreed to vote all shares of Brunswick common stock owned by him, her or it, that he, she or it, directly or indirectly, controls the right to vote and dispose of, in favor of approval and adoption of the merger agreement and the transactions contemplated thereby.
We urge you to vote as soon as possible so that your shares will be represented.
Your vote is very important, regardless of the number of shares of Brunswick common stock that you own. We cannot complete the merger unless a quorum is present and the affirmative vote of at least a majority of the votes cast at the special meeting votes to approve and adopt the Brunswick merger proposal.
Even if you plan to virtually attend the special meeting (information regarding how you can attend and participate in the special meeting is included in the proxy card), Brunswick requests that you complete, sign, date and return, as promptly as possible, the enclosed proxy card in the accompanying prepaid reply envelope or submit your proxy by Internet prior to the special meeting to ensure that your shares of Brunswick common stock will be represented at the special meeting. If you hold your shares in “street name” through a bank, brokerage firm or other nominee, you should follow the procedures provided by your bank, brokerage firm or other nominee to vote your shares. If you fail to submit a proxy or to virtually attend the special meeting and vote or do not provide your bank, brokerage firm or other nominee with instructions as to how to vote your shares, as applicable, your shares of Brunswick common stock will not be counted.



BY ORDER OF THE BOARD OF DIRECTORS,
/s/ David Gazerwitz
David Gazerwitz
Corporate Secretary
New Brunswick, New Jersey
[l], 2023
BRUNSWICK SHAREHOLDERS SHOULD NOT SEND STOCK CERTIFICATES AT THIS TIME. YOU WILL BE SENT SEPARATE INSTRUCTIONS ABOUT HOW TO RECEIVE THE MERGER CONSIDERATION AND THE SURRENDER OF YOUR STOCK CERTIFICATES.



HOW TO OBTAIN ADDITIONAL INFORMATION
This joint proxy statement/prospectus incorporates by reference important business and financial information about Mid Penn that is not included in or delivered with this document. You can obtain free copies of this information through the SEC website at https://www.sec.gov. You will also be able to obtain these documents, free of charge, from Mid Penn at www.midpennbank.com, under the heading “Investors” You can also obtain free copies of this information by writing or calling:
Mid Penn Bancorp, Inc.
2407 Park Drive
Harrisburg, Pennsylvania 17110
Attention: Corporate Secretary
1.866.642.7736
You will not be charged for any of these documents that you request. In order to obtain timely delivery of the documents, you must request the information no later than five business days before the date of the applicable special meeting.
Brunswick does not have a class of securities registered under Section 12 of the Securities Exchange Act of 1934 (the “Exchange Act”), is not subject to the reporting requirements of Section 13(a) or 15(d) of the Exchange Act, and accordingly does not file documents and reports with the SEC. If you are a shareholder of Brunswick and have questions about the merger or the special meeting of Brunswick, would like additional copies of this document or proxy cards, or need any other information related to the proxy solicitations, you may contact:
Brunswick Bancorp
439 Livingston Avenue
New Brunswick, New Jersey 08901
Attention: Corporate Secretary
732.247.5800
For a more detailed description of the information incorporated by reference in this joint proxy statement/prospectus and how you may obtain it, see the section entitled “Where You Can Find More Information” on page 106 and “Incorporation of Certain Documents by Reference” on page 107.
All information concerning Mid Penn and its subsidiaries has been furnished by Mid Penn, and all information concerning Brunswick and its subsidiaries has been furnished by Brunswick.
You should rely only on the information contained or incorporated by reference in this joint proxy statement/prospectus when evaluating the merger agreement and the proposed merger. We have not authorized anyone to provide you with information that is different from what is contained in this joint proxy statement/prospectus. This joint proxy statement/prospectus is dated [l], 2023. You should not assume that the information contained in this joint proxy statement/prospectus is accurate as of any date other than such date. Further, you should not assume that the information incorporated by reference into this joint proxy statement/prospectus is accurate as of any date other than the date of the incorporated document. Neither the mailing of this joint proxy statement/prospectus nor the issuance of shares of Mid Penn common stock as contemplated by the merger agreement shall create any implication to the contrary.
This joint proxy statement/prospectus does not constitute an offer to sell, or a solicitation of an offer to buy, any securities or the solicitation of a proxy, in any jurisdiction in which or from any person to whom it is not lawful to make any such offer or solicitation in such jurisdiction.
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ABOUT THIS JOINT PROXY STATEMENT/PROSPECTUS
This document, which forms part of a registration statement on Form S-4 filed with the SEC by Mid Penn (File No. [l]), constitutes a prospectus of Mid Penn under the Securities Act of 1933, as amended, which we refer to as the “Securities Act,” with respect to the shares of common stock, par value $1.00 per share, of Mid Penn, which we refer to as “Mid Penn common stock,” to be issued pursuant to the Agreement and Plan of Merger, dated as of December 20, 2022, by and between Mid Penn and Brunswick, which we refer to as the “merger agreement.” This document also constitutes a proxy statement of Mid Penn (under the Exchange Act) and Brunswick. It also constitutes a notice of meeting with respect to the special meetings, at which each of Mid Penn and Brunswick shareholders will be asked to vote on, among other things, approval of the merger agreement. Mid Penn has supplied all information contained or incorporated by reference into this joint proxy statement/prospectus relating to Mid Penn, and Brunswick has supplied all information contained in this joint proxy statement/prospectus relating to Brunswick.
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TABLE OF CONTENTS
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QUESTIONS AND ANSWERS ABOUT THE MERGER AND THE SPECIAL MEETINGS
The following questions and answers briefly address some commonly asked questions about the merger (as defined below) and the shareholder meetings. They may not include all the information that is important to the shareholders of Mid Penn and Brunswick. Shareholders of Mid Penn and Brunswick should each read carefully this entire joint proxy statement/prospectus, including the annexes and other documents referred to in this joint proxy statement/prospectus.
Questions about the Merger
Q:What is the merger?
A:Mid Penn and Brunswick have entered into an Agreement and Plan of Merger, dated December 20, 2022 which is referred to as the “merger agreement.” A copy of the merger agreement is attached as Annex A to, and is incorporated by reference in, this joint proxy statement/prospectus. The merger agreement contains the terms and conditions of the proposed business combination of Mid Penn and Brunswick. Under the merger agreement, Brunswick will merge with and into Mid Penn, with Mid Penn remaining as the surviving entity. We refer to this transaction as the “merger.” Immediately following the merger, Brunswick Bank & Trust Company, a wholly owned bank subsidiary of Brunswick, will merge with and into Mid Penn’s wholly owned bank subsidiary, Mid Penn Bank, with Mid Penn Bank as the surviving bank, and the separate corporate existence of Brunswick Bank & Trust Company will cease. We refer to this transaction as the “bank merger.” We refer to the merger and the bank merger collectively as the “mergers.”
Following the completion of the mergers, the merger agreement provides that Mid Penn will continue to operate the branches of Brunswick Bank & Trust Company.
Q:    Why am I receiving these materials?
A:    This document constitutes both a joint proxy statement of Mid Penn and Brunswick and a prospectus of Mid Penn. It is a joint proxy statement because the boards of directors of both companies are soliciting proxies from their respective shareholders. It is a prospectus because Mid Penn will issue shares of its common stock in exchange for shares of Brunswick common stock in the merger.
Mid Penn is providing this joint proxy statement/prospectus to its shareholders because the Mid Penn Board of Directors is soliciting their proxy for use at the Mid Penn special meeting of shareholders at which the Mid Penn shareholders will consider and vote on (i) approval and adoption of the merger agreement which provides for, among other things, the merger of Brunswick with and into Mid Penn (the “Mid Penn merger proposal”), (ii) approval of an amendment to Mid Penn’s Articles of Incorporation to increase the number of authorized shares of common stock from 20,000,000 to 40,000,000 shares (“Mid Penn amendment proposal 1”), (iii) approval of an amendment to Mid Penn’s Articles of Incorporation to limit the transactions requiring approval of our shareholders by a supermajority vote (“Mid Penn amendment proposal 2”) and (iv) approval of the authorization of the board of directors to adjourn the Mid Penn special meeting, if necessary, to solicit additional proxies, in the event there are not sufficient votes at the time of the special meeting to approve the other proposals (the “Mid Penn adjournment proposal”). See “The Mid Penn Special Meeting,” beginning on page 87 for more information.
Brunswick is providing this joint proxy statement/prospectus to its shareholders because the Brunswick Board of Directors is soliciting their proxy for use at the Brunswick special meeting of shareholders at which the Brunswick shareholders will consider and vote on (i) approval and adoption of the merger agreement which provides for, among other things, the merger of Brunswick with and into Mid Penn (the “Brunswick merger proposal”) and (ii) approval of the authorization of the board of directors to adjourn the Brunswick special meeting, if necessary, to solicit additional proxies, in the event there are not sufficient votes at the time of the special meeting to approve the Brunswick merger proposal (the “Brunswick adjournment proposal”). See “The Brunswick Special Meeting,” beginning on page 93 for more information.
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Information about these meetings, the merger and the other business to be considered at the meetings is contained in this joint proxy statement/prospectus. The merger cannot be completed unless the shareholders of Mid Penn and Brunswick each approve the merger.
Q:    Why is Mid Penn proposing the merger?
A:    The Mid Penn board of directors, in unanimously determining that the merger is in the best interests of Mid Penn, considered a number of key factors that are described under the heading “The Merger—Mid Penn’s Reasons for the Merger,” beginning on page 49.
Q:    Why is Brunswick proposing the merger?
A:    The Brunswick board of directors, in unanimously determining that the merger is in the best interests of Brunswick, considered a number of key factors that are described under the heading “The Merger—Brunswick’s Reasons for the Merger,” beginning on page 37.
Q:    What will Brunswick shareholders receive in the merger, and how will this affect holders of Mid Penn common stock?
A:    Upon completion of the merger, Brunswick shareholders will be entitled to elect to receive, subject to adjustment and proration as described in the merger agreement, either (A) 0.598 shares of Mid Penn common stock (the “Stock Consideration”) or (B) Eighteen Dollars ($18.00) (the “Cash Consideration” and together with the Stock Consideration, the “Merger Consideration”), for each share of Mid Penn common stock they own. While the Merger Consideration is fixed, the Stock Consideration and Cash Consideration are subject to adjustment depending on Brunswick’s consolidated shareholders’ equity as of certain measuring dates (as described in the merger agreement).
The market price of Mid Penn common stock will fluctuate before the completion of the merger; therefore, you are urged to obtain current market quotations for Mid Penn common stock.
Because of the number of shares of Mid Penn common stock being issued in the merger, the percentage ownership interest in Mid Penn represented by the existing shares of Mid Penn common stock will be diluted. Mid Penn shareholders will not receive any merger consideration and will continue to own their existing shares of Mid Penn common stock after the merger.
Q:    What equity stake will Brunswick shareholders hold in Mid Penn immediately following the merger?
A:    Following completion of the merger, current Mid Penn shareholders will own in the aggregate approximately ninety-four and six tenths percent (94.6%) of the outstanding shares of Mid Penn common stock and Brunswick shareholders will own approximately five and four tenths percent (5.4%) of the outstanding shares of Mid Penn common stock.
Q:    What happens if I am eligible to receive a fraction of a share of Mid Penn common stock as part of the merger consideration?
A:    If the aggregate number of shares of Mid Penn common stock that you are entitled to receive as part of the merger consideration includes a fraction of a share of Mid Penn common stock, you will receive cash in lieu of that fractional share. For each fractional share that would otherwise be issued, Mid Penn will pay cash in an amount equal to the fraction multiplied by Eighteen Dollars ($18.00). See the section entitled “The Merger Agreement—Consideration to be Received in the Merger” beginning on page 69 of this joint proxy statement/prospectus.
Q:    Who will be the directors and executive officers of the combined company following the merger?
A:    Following completion of the merger, the then current directors and executive officers of Mid Penn and Mid Penn Bank will continue in office and one (1) of the current directors of Brunswick selected by the board of
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directors of Brunswick, with the approval of Mid Penn’s board of directors, will be added to the board of directors of Mid Penn.
Q:    When do you expect to complete the merger?
A:    Subject to the satisfaction or waiver of the closing conditions as contemplated by the merger agreement, including receipt of shareholder approvals at the respective special meetings of Mid Penn and Brunswick and receipt of regulatory approvals, we currently expect to complete the merger in the second quarter of 2023. It is possible, however, that factors outside of either company’s control could result in us completing the merger at a later time or not completing it at all.
Q:    What happens if the merger is not completed?
A:    If the merger is not completed, Brunswick shareholders will not receive any consideration for their shares of common stock in connection with the merger. Instead, Brunswick will remain an independent company and its common stock will continue to be quoted on the OTC Pink Market. Under specified circumstances, Brunswick may be required to pay to Mid Penn a fee with respect to the termination of the merger agreement. For more information, please review the sections entitled “The Merger Agreement—Termination of the Merger Agreement” and “Termination Fee” beginning on page 81.
Q:    How will the merger affect Brunswick equity awards?
A:    Brunswick equity awards will be affected as follows:
Stock Options: At the effective time of the merger, each option to purchase shares of Brunswick common stock outstanding immediately before the effective time of the merger, whether or not vested, will be canceled and exchanged for a cash payment equal to the product obtained by multiplying (x) the aggregate number of shares of Brunswick common stock that are issuable upon exercise of such option and (y) the Cash Consideration, less the per share exercise price of such option, without interest.
Restricted Stock: At the effective time of the merger, each share of Brunswick restricted stock that is outstanding immediately before the effective time shall vest in full and shall be cancelled and converted automatically into the right to receive the Merger Consideration payable pursuant to the merger agreement, less applicable withholding tax, and treating shares of Brunswick common stock subject to such Brunswick restricted stock in the same manner as all other shares of Brunswick common stock for such purposes.
Q:    What are the federal income tax consequences of the merger?
A:    The merger has been structured to qualify as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended, which is referred to as the Internal Revenue Code. It is a condition to the completion of the merger that each of Mid Penn and Brunswick receive a written opinion from their respective legal counsel to the effect that the merger will be treated as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code. Accordingly, Brunswick shareholders generally will only recognize gain (but not loss) in an amount not to exceed the cash (if any) received as part of the merger consideration but will recognize gain or loss (1) if such holder received the entirety of its consideration in cash or (2) with respect to any cash received in lieu of fractional shares of Mid Penn common stock. See “Material United States Federal Income Tax Consequences of the Merger” beginning on page 84.
This tax treatment may not apply to all Brunswick shareholders. Determining the actual tax consequences of the merger to Brunswick shareholders can be complicated. Brunswick shareholders should consult their own tax advisor for a full understanding of the merger’s tax consequences that are particular to each shareholder. For further discussion of the material U.S. federal income tax consequences of the merger, see “Material United States Federal Income Tax Consequences of the Merger,” beginning on page 84.
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Questions about the Mid Penn Special Meeting
Q:    What am I being asked to vote on at the Mid Penn special meeting?
A:    Mid Penn shareholders of record are being asked to consider and vote on:
1.the Mid Penn merger proposal;
2.Mid Penn amendment proposal 1 (increase authorized shares);
3.Mid Penn amendment proposal 2 (eliminate shareholder vote requirement); and
4.the Mid Penn adjournment proposal.
Q:    How does the Mid Penn board of directors recommend that I vote my shares?
A:    The Mid Penn board of directors recommends that the Mid Penn shareholders vote their shares as follows:
“FOR” the Mid Penn merger proposal;
“FOR” Mid Penn amendment proposal 1 (increase authorized shares);
“FOR” Mid Penn amendment proposal 2 (eliminate shareholder vote requirement); and
“FOR” the Mid Penn adjournment proposal.
As of the record date, directors and executive officers of Mid Penn and their affiliates had the right to vote [l] shares of Mid Penn common stock, or [l]% of the outstanding Mid Penn common stock entitled to be voted at the special meeting. Each of the directors and executive officers of Mid Penn have agreed to vote all shares of Mid Penn common stock owned by him or her that he or she, directly or indirectly, controls the right to vote and dispose of, in favor of adoption of the merger agreement.
Q:    What do I need to do now?
A:    After carefully reading and considering the information contained in this joint proxy statement/prospectus, please submit your proxy as soon as possible so that your shares will be represented at the Mid Penn special meeting. Please follow the instructions set forth on the proxy card or on the voting instruction form provided by the record holder if your shares are held in the name of your broker or other nominee.
Q:    Who is entitled to vote at the Mid Penn special meeting?
A:    Mid Penn shareholders of record as of the close of business on March 1, 2023, which is referred to as the “Mid Penn record date,” are entitled to notice of, and to vote at, the Mid Penn special meeting.
Q:    How many votes do I have?
A:    Each outstanding share of Mid Penn common stock is entitled to one vote.
Q:    How do I vote my Mid Penn shares?
A:    Mid Penn shareholders of record may vote their Mid Penn shares by completing and returning the enclosed proxy card, by Internet, by telephone or by voting virtually at the Mid Penn special meeting.
Voting by Proxy. Mid Penn shareholders of record may vote their Mid Penn shares by completing and returning the enclosed proxy card. Your proxy will be voted in accordance with your instructions. If you submit a properly executed and dated proxy, but do not specify a choice on one of the proposals described in this joint proxy statement/prospectus, your proxy will be voted in favor of that proposal.
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Voting by Internet. If you are a registered shareholder, you may vote electronically through the Internet by following the instructions included on your proxy card. If your shares are registered in the name of a broker or other nominee, you may be able to vote via the Internet. If so, the voting form your nominee sends you will provide Internet instructions.
Voting by Phone. If you are a registered shareholder, you may vote by phone by calling (866) 883-0222. Remember to have your proxy card in hand when you call, and then follow the instructions.
Voting Virtually at the Special Meeting. Mid Penn shareholders may vote at the virtual meeting if they register at www.proxydocs.com/MPB by 12:00 p.m. Eastern Time on April 24, 2023, attend the virtual meeting on April 25, 2023 at 10:00 a.m. Eastern Time and then click on the “vote” link. Additional information regarding how to virtually attend and vote at the special meeting is included in this joint proxy statement/prospectus and on the proxy card. If your shares are registered in the name of a broker or other nominee and you wish to vote at the special meeting, you may need to obtain a legal proxy from your bank or brokerage firm. Please consult the voting form sent to you by your bank or broker to determine how to obtain a legal proxy in order to vote at the special meeting.
Q:    Why is my vote important?
A:    Because the Mid Penn merger proposal and Mid Penn amendment proposal 2 cannot be approved without the affirmative vote of at least sixty-six and two-thirds percent (66 2/3%) of the outstanding shares of Mid Penn common stock at the Mid Penn special meeting and Mid Penn amendment proposal 1 and the Mid Penn adjournment proposal cannot be approved without the affirmative vote of a majority of the votes cast, every shareholder’s vote is important.
Q:    If my shares of Mid Penn common stock are held in street name by my broker, will my broker automatically vote my shares for me?
A:    No. Your broker CANNOT vote your shares on any proposal at the Mid Penn special meeting without instructions from you. You should instruct your broker as to how to vote your shares, following the directions your broker provides to you.
Q:    What if I fail to instruct my broker?
A:    If you do not provide your broker with instructions, your broker generally will not be permitted to vote your shares on the merger proposal or any other proposal (a so-called “broker non-vote”) at the Mid Penn special meeting. Because the affirmative vote of sixty-six and two-thirds percent (66 2/3%) of outstanding Mid Penn shares is necessary to approve the Mid Penn merger proposal and Mid Penn amendment proposal 2, any broker non-votes submitted by brokers or nominees in connection with the special meeting will in effect be a vote against the merger. For purposes of determining the number of votes cast with respect to Mid Penn amendment proposal 1 and the Mid Penn adjournment proposal, only those votes cast “for” or “against” the proposals are counted. Any broker non-votes submitted by brokers or nominees in connection with the special meeting will not be counted as votes “for” or “against” for determining the number of votes cast and will not be treated as present for quorum purposes. If your bank, broker, trustee or other nominee holds your shares of Mid Penn common stock in “street name,” such entity will vote your shares of Mid Penn common stock only if you provide instructions on how to vote by complying with the voting instructions form sent to you by your bank, broker, trustee or other nominee with this joint proxy statement/prospectus.
Q:    What constitutes a quorum for the Mid Penn special meeting?
A:    As of the Mid Penn record date, [l] shares of Mid Penn common stock were issued and outstanding, each of which will be entitled to one vote at the meeting. Under Mid Penn’s bylaws, the presence, in person or by proxy, of shareholders entitled to cast at least a majority of the votes that all shareholders are entitled to cast constitutes a quorum for the transaction of business at the special meeting. If you vote by proxy, your shares will be included for determining the presence of a quorum. Abstentions are also included for
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determining the presence of a quorum. If you fail to submit a proxy prior to the special meeting or to vote at the Mid Penn special meeting, your shares of Mid Penn common stock will not be counted towards a quorum.
Q:    Assuming the presence of a quorum, what is the vote required to approve the matters to be considered at the Mid Penn special meeting?
A:    The affirmative vote of at least sixty-six and two-thirds percent (66 2/3%) of the outstanding shares of Mid Penn common stock at the Mid Penn special meeting is required to approve the Mid Penn merger proposal and Mid Penn amendment proposal 2 and the affirmative vote of a majority of the votes cast, in person or by proxy, at the Mid Penn special meeting is required to approve Mid Penn amendment proposal 1 and the Mid Penn adjournment proposal. Therefore, abstentions and broker non-votes will have the same effect as a vote “AGAINST” the Mid Penn merger proposal and Mid Penn amendment proposal 2, but will have no effect on Mid Penn amendment proposal 1 and the Mid Penn adjournment proposal.
Q:    Do I have appraisal or dissenters’ rights?
A:    No. Under Pennsylvania law, holders of Mid Penn common stock will not be entitled to exercise any appraisal rights in connection with the merger.
Q:    Can I attend the Mid Penn special meeting and vote my shares virtually?
A:    Yes, if you register at www.proxydocs.com/MPB by 12:00 p.m. Eastern Time on April 24, 2023. All shareholders, including shareholders of record and those who hold their shares through banks, brokers, nominees or any other holder of record, are invited to virtually attend the special meeting. Holders of record of Mid Penn common stock can vote virtually at the special meeting. If you are not a shareholder of record, you must obtain a proxy, executed in your favor, from the record holder of your shares, such as a broker, bank or other nominee, to be able to vote at the special meeting. If you plan to virtually attend the special meeting, you must hold your shares in your own name or have a letter from the record holder of your shares confirming your ownership. Additional information regarding attending and voting at the virtual special meeting is included above and in the proxy card included with this joint proxy statement/prospectus.
Q:    Can I change my vote?
A:    Yes. You may revoke any proxy at any time before it is voted by (1) signing and returning a proxy card with a later date (if you submitted your proxy by Internet or by telephone, you can vote again by Internet or telephone), (2) delivering a written revocation letter to Mid Penn’s Corporate Secretary, or (3) virtually attending the special meeting, notifying the Corporate Secretary and voting at the special meeting. Mid Penn’s Corporate Secretary’s mailing address is Mid Penn Bancorp, Inc., 2407 Park Drive, Harrisburg, Pennsylvania 17110, Attention: Corporate Secretary.
Any shareholder entitled to vote virtually at the special meeting may vote regardless of whether a proxy has been previously given, and such vote will revoke any previous proxy, but the mere virtual presence (without notifying Mid Penn’s Corporate Secretary) of a shareholder at the special meeting will not constitute revocation of a previously given proxy. A shareholder may change his or her vote up and until the time that votes are counted but not thereafter.
Q:    How will proxies be solicited and who will bear the cost of soliciting votes for the Mid Penn special meeting?
A:    Mid Penn has engaged Mediant to act as the proxy solicitor and to assist in the solicitation of proxies for the Mid Penn special meeting of shareholders. Mid Penn has agreed to pay Mediant approximately $11,400, plus reasonable out-of-pocket expenses, for such services and will also indemnify Mediant against certain claims, costs, damages, liabilities, and expenses.
Mid Penn will bear the cost of preparing and assembling these proxy materials for the Mid Penn special meeting. The cost of printing and mailing these proxy materials will be shared equally between Mid Penn
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and Brunswick. The solicitation of proxies or votes for the Mid Penn special meeting may also be made in person, by telephone, or by electronic communication by Mid Penn’s directors, officers, and employees, none of whom will receive any additional compensation for such solicitation activities. In addition, Mid Penn may reimburse brokerage firms and other persons representing beneficial owners of shares for their expenses in forwarding solicitation material to such beneficial owners.
Q:    Can additional proposals be presented at the Mid Penn special meeting?
A:    No. Other than the proposals described in this joint proxy statement/prospectus, no additional matters can be presented for a vote at the special meeting.
Q:    Are there risks that I should consider in deciding whether to vote to approve the merger agreement?
A:    Yes. You should consider the risk factors set out in the section entitled “Risk Factors” beginning on page 24 of this joint proxy statement/prospectus.
Q:    What if I hold stock of both Mid Penn and Brunswick?
A:    If you hold shares of both Mid Penn and Brunswick, you will receive two separate packages of proxy materials. A vote as a Mid Penn shareholder for the Mid Penn merger proposal or the Mid Penn adjournment proposal will not constitute a vote as a Brunswick shareholder for the Brunswick merger proposal or any other proposals to be considered at the Brunswick special meeting, and vice versa. Therefore, please sign, date and return all proxy cards that you receive, whether from Mid Penn or Brunswick, or submit separate proxies as both a Mid Penn shareholder and a Brunswick shareholder as instructed.
Q:    Whom should I contact if I have additional questions?
A:    If you are a Mid Penn shareholder and have any questions about the merger, need assistance in submitting your proxy or voting your shares of Mid Penn common stock, or if you need additional copies of this document or the enclosed proxy card, you should contact Mediant, the proxy solicitor for Mid Penn, at 1.888.408.4059. You may also contact:
Mid Penn Bancorp, Inc.
2407 Park Drive
Harrisburg, Pennsylvania 17110
Attention: Investor Relations
Telephone: 1.866.642.7736
Questions about the Brunswick Special Meeting
Q:    What am I being asked to vote on at the Brunswick special meeting?
A:    Brunswick shareholders of record are being asked to consider and vote on:
1.the Brunswick merger proposal; and
2.the Brunswick adjournment proposal.
Q:    How does the Brunswick board of directors recommend that I vote my shares?
A:    The Brunswick board of directors recommends that the Brunswick shareholders vote their shares as follows:
“FOR” the Brunswick merger proposal; and
“FOR” the Brunswick adjournment proposal.
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As of the record date, directors, executive officers and certain ten percent (10%) shareholders of Brunswick identified in the merger agreement and their affiliates had the right to vote [l] shares of Brunswick common stock, or approximately [l]% of the outstanding Brunswick common stock entitled to be voted at the Brunswick special meeting. Each of the directors, executive officers and certain ten percent (10%) shareholders of Brunswick identified in the merger agreement have agreed to vote all shares of Brunswick common stock owned by him, her or it that he, she or it, directly or indirectly, controls the right to vote and dispose of, in favor of adoption of the merger agreement.
Q:    What do I need to do now?
A:    After carefully reading and considering the information contained in this joint proxy statement/prospectus, please submit your proxy as soon as possible so that your shares will be represented at the Brunswick special meeting. Please follow the instructions set forth on the proxy card or on the voting instruction form provided by the record holder if your shares are held in the name of your broker or other nominee.
Q:    Who is entitled to vote at the Brunswick special meeting?
A:    Brunswick shareholders of record as of the close of business on March 3, 2023, which is referred to as the “Brunswick record date,” are entitled to notice of, and to vote at, the Brunswick special meeting.
Q:    How many votes do I have?
A:    Each outstanding share of Brunswick common stock is entitled to one vote.
Q:    How do I vote my Brunswick shares?
A:    Brunswick shareholders of record may vote their Brunswick shares by completing and returning the enclosed proxy card, by Internet, by telephone or by voting virtually at the Brunswick special meeting.
Voting by Proxy. You may vote your Brunswick shares by completing and returning the enclosed proxy card. Your proxy will be voted in accordance with your instructions. If you submit a properly executed and dated proxy, but do not specify a choice on one of the proposals described in this joint proxy statement/prospectus, your proxy will be voted in favor of that proposal.
Voting by Internet. If you are a registered shareholder, you may vote electronically through the Internet by following the instructions included on your proxy card. If your shares are registered in the name of a broker or other nominee, you may be able to vote via the Internet. If so, the voting form your nominee sends you will provide Internet instructions.
Voting by Phone. Use any touch-tone telephone to transmit your voting instructions up until 11:59 p.m. Eastern Time the day before the cut-off date or meeting date. Have your proxy card and twelve-digit voting code in hand when you call 813.235.4490 and then follow the instructions.
Voting Virtually at the Special Meeting. You may virtually attend the Brunswick special meeting and vote. Information regarding how to virtually attend the special meeting is included in the proxy card. If your shares are registered in the name of a broker or other nominee and you wish to vote at the meeting, you will need to obtain a legal proxy from your bank or brokerage firm. Please consult the voting form sent to you by your bank or broker to determine how to obtain a legal proxy in order to vote at the Brunswick special meeting.
Q:    Why is my vote important?
A:    Because the merger cannot be completed without a quorum being present at the virtual meeting and the affirmative vote of a majority of the votes cast at the special meeting, every shareholder’s vote is important
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Q:    If my shares of Brunswick common stock are held in street name by my broker, will my broker automatically vote my shares for me?
A:    No. Your broker CANNOT vote your shares on any proposal at the Brunswick special meeting without instructions from you. You should instruct your broker as to how to vote your shares, following the directions your broker provides to you. Please check the voting form used by your broker.
Q:    What if I fail to instruct my broker?
A:    If you do not provide your broker with instructions, your bank, broker, trustee or other nominee generally will not be permitted to vote your shares on the Brunswick merger proposal or any other proposal (a so-called “broker non-vote”) at the Brunswick special meeting. Because the affirmative vote of a majority of the votes cast at the special meeting is necessary to approve the Brunswick merger proposal, any broker non-votes submitted by brokers or nominees in connection with the special meeting will have no effect on the Brunswick proposals. Broker non-votes only count toward a quorum if at least one proposal is presented with respect to which the bank, broker, trustee or other nominee has discretionary authority. It is expected that all proposals to be voted on at the Brunswick special meeting will be “non-routine” matters, and, as such, broker non-votes, if any, will not be counted as present and entitled to vote for purposes of determining a quorum at the Brunswick special meeting. If there is not a quorum at the Brunswick special meeting, no vote on the Brunswick Merger Proposal or any other matter may be undertaken at the Brunswick virtual meeting. If your bank, broker, trustee or other nominee holds your shares of Brunswick common stock in “street name,” such entity will vote your shares of Brunswick common stock only if you provide instructions on how to vote by complying with the voting instruction form sent to you by your bank, broker, trustee or other nominee with this joint proxy statement/prospectus.
Q:    What constitutes a quorum for the Brunswick special meeting?
A:    As of the Brunswick record date, [l] shares of Brunswick common stock were issued and outstanding, each of which will be entitled to one vote at the meeting. Under Brunswick’s bylaws, the presence, in person or by proxy, of shareholders entitled to cast at least a majority of the votes that all shareholders are entitled to cast constitutes a quorum for the transaction of business at the special meeting. If you vote by proxy, your shares will be included for determining the presence of a quorum. Abstentions are also included for determining the presence of a quorum. If you fail to submit a proxy prior to the special meeting or to vote at the Brunswick special meeting, your shares of Brunswick common stock will not be counted towards a quorum.
Q:    Assuming the presence of a quorum, what is the vote required to approve the matters to be considered at the Brunswick special meeting?
A:    Assuming a quorum is present, approval of the Brunswick merger proposal will require a majority of the votes cast by the shareholders present at the special meeting, in person or by proxy, to be voted “FOR” the Brunswick merger proposal. Additionally, assuming a quorum is present, approval of the Brunswick adjournment proposal will require the affirmative vote of a majority of the votes cast at the Brunswick special meeting by the shareholders present in person or represented by proxy and entitled to vote on the proposal, without regard to abstentions or broker non-votes. Abstentions and broker non-votes will have no effect on the Brunswick merger proposal and the Brunswick adjournment proposal.
Q:    Do I have appraisal or dissenters’ rights?
A:    No. Neither the New Jersey Business Corporation Act nor Brunswick’s Certificate of Incorporation entitle Brunswick’s shareholders to dissenters’ rights.
Q:    Can I attend the Brunswick special meeting and vote my shares virtually?
A:    Yes. All shareholders, including shareholders of record and those who hold their shares through banks, brokers, nominees or any other holder of record, are invited to virtually attend the special meeting.
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Holders of record of Brunswick common stock can vote virtually at the special meeting. If you are not a shareholder of record, you must obtain a proxy, executed in your favor, from the record holder of your shares, such as a broker, bank or other nominee, to be able to vote at the special meeting. If you plan to attend the special meeting, you must hold your shares in your own name or have a letter from the record holder of your shares confirming your ownership.
A:    Can I change my vote?
Q:    Yes. You may revoke your proxy at any time before it is voted by (1) signing and returning a proxy card with a later date (if you submitted your proxy by Internet or by telephone, you can vote again by Internet or telephone), (2) delivering a written revocation letter to Brunswick’s Corporate Secretary, or (3) virtually attending the special meeting, notifying the Corporate Secretary and voting at the special meeting. The mailing address for Brunswick’s Corporate Secretary is Brunswick Bancorp, 439 Livingston Avenue, New Brunswick, New Jersey 08901, Attention: Corporate Secretary.
Any shareholder entitled to vote virtually at the special meeting may vote regardless of whether a proxy has been previously given, and such vote will revoke any previous proxy, but the mere virtual presence (without notifying Brunswick’s Corporate Secretary) of a shareholder at the special meeting will not constitute revocation of a previously given proxy. A shareholder may change his or her vote up and until the time that votes are counted but not thereafter.
Q:    How will proxies be solicited and who will bear the cost of soliciting votes for the Brunswick special meeting?
A:    Brunswick has not engaged a proxy solicitor for the Brunswick special meeting of shareholders.
Brunswick will bear the cost of preparing and assembling these proxy materials for the Brunswick special meeting. The cost of printing and mailing these proxy materials will be shared equally between Mid Penn and Brunswick. The solicitation of proxies or votes for the Brunswick special meeting may be made in person, by telephone, or by electronic communication by Brunswick’s directors, officers, and employees, none of whom will receive any additional compensation for such solicitation activities. In addition, Brunswick may reimburse brokerage firms and other persons representing beneficial owners of shares for their expenses in forwarding solicitation material to such beneficial owners.
Q:    Are there risks that I should consider in deciding whether to vote to approve the merger agreement?
A:    Yes. You should consider the risk factors set out in the section entitled “Risk Factors” beginning on page 24 of this joint proxy statement/prospectus.
Q:    What if I hold stock of both Mid Penn and Brunswick?
A:    If you hold shares of both Mid Penn and Brunswick, you will receive two separate packages of proxy materials. A vote as a Brunswick shareholder for the Brunswick merger proposal or any other proposals to be considered at the Brunswick special meeting will not constitute a vote as a Mid Penn shareholder for the Mid Penn merger proposal or any other proposals to be considered at the Mid Penn special meeting, and vice versa. Therefore, please sign, date and return all proxy cards that you receive, whether from Mid Penn or Brunswick, or submit separate proxies as both a Mid Penn shareholder and a Brunswick shareholder as instructed.
Q:    Should I send in my Brunswick stock certificates now?
A:    No, please do NOT return your stock certificate(s) with your proxy. You will be provided separate instructions regarding the surrender of your stock certificates. You should then send your Brunswick stock certificates to the exchange agent in accordance with those instructions.
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Q:    What should I do if I hold my Brunswick shares in book-entry form?
A:    You are not required to take any additional actions if your shares of Brunswick common stock are held in book-entry form. You will receive separate instructions from the brokerage firm holding your shares on how to select the form of Merger Consideration you wish to receive (i.e., Cash Consideration, Stock Consideration or a mix of both). Promptly following the completion of the merger, shares of Brunswick common stock held in book-entry form automatically will be exchanged for the Merger Consideration.
Q:    Whom should I contact if I have additional questions?
A:    If you are a Brunswick shareholder and have any questions about the merger, need assistance in submitting your proxy or voting your shares of Brunswick common stock, or if you need additional copies of this document or the enclosed proxy card, you should contact Brunswick at:
Brunswick Bancorp
439 Livingston Avenue
New Brunswick, New Jersey 08901
Attention: Corporate Secretary
Telephone: 732.247.5800
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SUMMARY
This summary highlights information contained elsewhere in this joint proxy statement/prospectus and may not contain all of the information that is important to you. We urge you to carefully read the entire joint proxy statement/prospectus and the other documents to which we refer in order to fully understand the merger and the related transactions. See “Where You Can Find More Information.”
Information about the Parties
Mid Penn Bancorp, Inc.
Mid Penn Bancorp, Inc. is the financial holding company for Mid Penn Bank, a full-service Pennsylvania chartered bank and trust company originally organized in 1868, as well as three (3) non-bank subsidiaries formed in 2020 to further expand its suite of products and services. Mid Penn is regulated by the Board of Governors of the Federal Reserve System.
Headquartered in Millersburg, Pennsylvania, Mid Penn Bank services its customers and communities through forty-three (43) retail banking locations located in the Pennsylvania counties of Berks, Blair, Bucks, Centre, Chester, Clearfield, Cumberland, Dauphin, Fayette, Huntingdon, Lancaster, Lehigh, Luzerne, Montgomery, Perry, Schuylkill and Westmoreland. Mid Penn Bank engages in full-service commercial banking and trust business, making available to the community a wide range of financial services, including, but not limited to, mortgage and home equity loans, secured and unsecured commercial and consumer loans, lines of credit, construction financing, farm loans, community development and local government loans and various types of time and demand deposits. In addition, Mid Penn Bank provides a full range of trust and retail investment services, as well as online banking, telephone banking, cash management services, automated teller services and safe deposit boxes. Mid Penn Bank is regulated by the Pennsylvania Department of Banking and Securities and the Federal Deposit Insurance Corporation.
The principal executive offices of Mid Penn are located at 2407 Park Drive, Harrisburg, Pennsylvania 17110 and its telephone number is 1.866.642.7736.
Mid Penn common stock is traded on The Nasdaq Global Market under the symbol “MPB.”
Brunswick Bancorp
Brunswick was formed in 1985 as a bank holding company incorporated under the laws of New Jersey. Brunswick is regulated by the Board of Governors of the Federal Reserve System. Brunswick provides a full range of financial services through its wholly-owned bank subsidiary, Brunswick Bank & Trust Company, which is its sole operating segment.
Brunswick Bank & Trust Company is a New Jersey-chartered bank and trust company regulated by the New Jersey Department of Banking and Insurance and the Federal Deposit Insurance Corporation that offers financial services through five (5) community banking offices. Brunswick Bank & Trust Company has two wholly-owned subsidiaries, one of which offers title agency services and the other which holds a portion of Brunswick Bank and Trust Company’s securities and loan portfolio. Brunswick Bank & Trust Company’s market area consists of Middlesex and Monmouth Counties in New Jersey.
The principal executive offices of Brunswick are located at 439 Livingston Avenue, New Brunswick, New Jersey 08901, and its telephone number is 732-247-5800.
Brunswick common stock is quoted on the OTC Pink Market under the symbol “BRBW.”
The Merger and the Merger Agreement (pages 34 and 69)
The terms and conditions of the merger are contained in the merger agreement, which is attached as Annex A to this joint proxy statement/prospectus and incorporated by reference herein. Please carefully read the merger agreement as it is the legal document that governs the merger.
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Pursuant to the merger agreement, Brunswick will merge with and into Mid Penn with Mid Penn as the surviving corporation. Immediately after the merger, Brunswick Bank & Trust Company will merge with and into Mid Penn Bank, with Mid Penn Bank as the surviving bank.
Mid Penn Will Hold Its Special Meeting on April 25, 2023 (page 87)
The Mid Penn special meeting will be held virtually on April 25, 2023 at 10:00 a.m. Eastern Time. At the special meeting, Mid Penn shareholders will be asked to:
1.approve the Mid Penn merger proposal;
2.approve Mid Penn amendment proposal 1 (increase authorized shares);
3.approve Mid Penn amendment proposal 2 (eliminate shareholder vote requirement); and
4.approve the Mid Penn adjournment proposal.
Record Date. Only holders of record of Mid Penn common stock at the close of business on March 1, 2023 will be entitled to vote at the special meeting. Each share of Mid Penn common stock is entitled to one vote. As of the Mid Penn record date, there were [l] shares of Mid Penn common stock issued and outstanding and entitled to vote at the special meeting.
Registration. In order to attend and vote at the virtual meeting, all shareholders must register at www.proxydocs.com/MPB by 12:00 p.m. Eastern Time on April 24, 2023. Upon completion of your registration, you will receive further instructions via email that will provide you access to the special meeting.
Required Vote. The affirmative vote, in person or by proxy, of at least sixty-six and two thirds percent (66 2/3%) of the outstanding shares of Mid Penn common stock is required to approve the Mid Penn merger proposal and Mid Penn amendment proposal 2, and a majority of the votes cast at the special meeting is required to approve Mid Penn amendment proposal 1 and the Mid Penn adjournment proposal. The presence, in person or by proxy, of a majority of the outstanding shares of Mid Penn common stock is necessary to constitute a quorum in order to transact business at the special meeting.
As of the record date, directors and executive officers of Mid Penn and their affiliates had the right to vote [l] shares of Mid Penn common stock, or [l]% of the outstanding Mid Penn common stock entitled to be voted at the special meeting. Each of the directors and executive officers of Mid Penn have agreed to vote all shares of Mid Penn common stock owned by him or her that he or she, directly or indirectly, controls the right to vote and dispose of, in favor of the Mid Penn merger proposal.
Brunswick Will Hold Its Special Meeting on April 25, 2023 (page 93)
The Brunswick special meeting will be held virtually on April 25, 2023 at 10:00 a.m., Eastern Time. At the special meeting, Brunswick shareholders will be asked to:
1.approve the Brunswick merger proposal; and
2.approve the Brunswick adjournment proposal.
Record Date. Only holders of record of Brunswick common stock at the close of business on March 3, 2023 will be entitled to vote at the special meeting. Each share of Brunswick common stock is entitled to one vote. As of the Brunswick record date, there were [l] shares of Brunswick common stock issued and outstanding and entitled to vote at the special meeting.
Required Vote. Approval of the Brunswick merger proposal requires the affirmative vote of the holders of at least a majority of the votes cast at the Brunswick special meeting. Failure to submit valid proxy instructions or to vote during the virtual meeting will have no effect on the Brunswick merger proposal. Broker non-votes and abstentions from voting will have no effect on the Brunswick merger proposal.
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As of the record date, directors, executive officers and certain ten percent (10%) shareholders of Brunswick identified in the merger agreement and their affiliates had the right to vote [l] shares of Brunswick common stock, or approximately [l]% of the outstanding Brunswick common stock entitled to be voted at the special meeting. Each of the directors and the executive officers and those ten percent (10%) shareholders of Brunswick indicated in the merger agreement have agreed to vote all shares of Brunswick common stock owned by him, her or it in favor of adoption of the merger agreement.
Approval of the Brunswick adjournment proposal requires the affirmative vote of the holders of at least a majority of the votes cast at the Brunswick special meeting. Failure to submit valid proxy instructions or to vote in person will have no effect on the Brunswick adjournment proposal. Broker non-votes and abstentions from voting will have no effect on the Brunswick adjournment proposal.
Consideration to be Received in the Merger (page 69)
The merger agreement provides that Brunswick shareholders will have the right, with respect to each of their shares of Brunswick common stock, to elect to receive, subject to proration and adjustment as described below, either (i) Eighteen Dollars ($18.00) in cash, without interest, or (ii) 0.598 shares of Mid Penn common stock. Brunswick shareholders will have the opportunity to elect the form of consideration to be received for each of their shares, subject to proration and allocation procedures set forth in the merger agreement, which may result in your receiving a portion of the merger consideration in a form other than that which such shareholder elected. No fractional shares of Mid Penn common stock will be issued to any holder of Brunswick common stock upon completion of the merger. For each fractional share that would otherwise be issued, Mid Penn will pay each shareholder cash (without interest) in an amount determined by multiplying the fractional share interest to which such holder would otherwise be entitled by eighteen dollars ($18.00), rounded to the nearest whole cent.
Election Procedures for Brunswick Shareholders (page 71)
Not more than forty-five (45) days nor less than thirty (30) days prior to the anticipated closing date of the merger, unless Mid Penn and Brunswick have mutually agreed to another period, each holder of record of Brunswick common stock will be sent an election form that you may use to indicate whether your preference is to receive cash or shares of Mid Penn common stock. The election deadline will be 5:00 p.m., Eastern Time, on the 25th day following the mailing date of the election form to Brunswick shareholders, unless Mid Penn and Brunswick have mutually agreed to another date and time as the election deadline. To make an election, a holder must submit a properly completed election form and return it so that the form is actually received at or before the election deadline in accordance with the instructions on the election form.
Non-Electing Brunswick Shareholders (page 70)
Brunswick shareholders who make no election to receive cash or Mid Penn common stock in the merger or who do not make a valid election will be deemed to have elected either Stock Consideration or Cash Consideration depending on the proration adjustments required by the merger agreement (discussed below).
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Proration (page 70)
The total number of shares of Brunswick common stock (including restricted stock) to be entitled to receive the Cash Consideration shall be equal to fifty percent (50%) of all issued and outstanding shares immediately prior to the effective time. Similarly, the total number of shares of Brunswick common stock (including restricted stock) to be entitled to receive the Stock Consideration shall be equal to fifty percent (50%) of the issued and outstanding shares immediately prior to the effective time.
To achieve this, if the aggregate number of shares of Brunswick common stock with respect to which an election to receive one form of Merger Consideration is less than or exceeds fifty percent (50%) of all issued and outstanding shares immediately prior to the effective time, proration mechanisms will be applied to each Brunswick shareholder electing the form of Merger Consideration that is overelected so that cash election shares and stock election shares equal 50/50. Non-electing shares factor into the proration formula and will receive the form of Merger Consideration that is underelected so that the cash election shares and stock election shares each equal Fifty percent (50%) of the aggregate number of shares of Brunswick common stock immediately prior to the effective time. The specifics of the proration adjustments are described herein at “The Merger Agreement – Consideration to be Received in the Merger – Proration”.
Adjustment (page 70)
If Brunswick’s consolidated shareholders’ equity (calculated in accordance with the merger agreement) as of certain measuring dates is less than the Minimum Brunswick Consolidated Shareholders’ Equity (as defined in the merger agreement) on such dates, the Cash Consideration and Stock Consideration will automatically be adjusted downward. Brunswick must have Minimum Brunswick Consolidated Shareholders’ Equity of (A) $43,600,000 if the Measuring Date (as defined in the merger agreement) is March 31, 2023, (B) $43,900,000 if the Measuring Date is April 30, 2023, (C) $44,200,000 if the Measuring Date is May 31, 2023 and (D) $44,500,000 if the Measuring Date is June 30, 2023. The specifics of this adjustment mechanism are described herein at “The Merger Agreement – Consideration to be Received in the Merger – Adjustment”. As of [l], Brunswick’s consolidated shareholders’ equity was [l].
Expected Material United States Federal Income Tax Treatment as a Result of the Merger (page 84)
The merger is structured to be treated as a reorganization for United States federal income tax purposes. Each of Mid Penn and Brunswick has conditioned the consummation of the merger on its receipt of a legal opinion that this will be the case. As such, Brunswick shareholders generally will only recognize gain (but not loss) in an amount not to exceed the cash (if any) received as part of the Merger Consideration but will recognize gain or loss (A) if such holder received the entirety of its consideration in cash or (B) with respect to any cash received in lieu of fractional shares of Mid Penn common stock.
This tax treatment may not apply to all Brunswick shareholders. Determining the actual tax consequences of the merger to Brunswick shareholders can be complicated. Brunswick shareholders should consult their own tax advisor for a full understanding of the merger’s tax consequences that are particular to each shareholder. For further information, please refer to “Material United States Federal Income Tax Consequences of the Merger” on page 84.
Accounting Treatment of the Merger (page 83)
Mid Penn will account for this transaction as a business combination under the acquisition method. On the acquisition date, Mid Penn will record at fair value the identifiable assets acquired and the liabilities assumed, any noncontrolling interest, and goodwill (or a gain from a bargain purchase). The results of operations for the combined company will be reported prospectively subsequent to the acquisition date.
Market Prices and Share Information (page 32)
Mid Penn common stock is listed on The Nasdaq Global Market under the symbol “MPB.” Brunswick common stock is quoted on the OTC Pink Market under the symbol “BRBW.”
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The table below shows the last sale price of Mid Penn common stock and Brunswick common stock as well as the value of Mid Penn common stock received per share of Brunswick common stock based upon the exchange ratio, on December 19, 2022 (the last full trading day prior to announcement of the execution of the merger agreement) and [l], 2023 (the latest practicable trading day prior to the date of these materials).
Brunswick Comm Stock
Mid Penn Common Stock
Exchange Ratio
Equivalent Per Share Value:
December 19, 2022
$16.45 $30.95 $0.598 $18.51 
At [l], 2023
$                     $                     $0.598 $                     
Because the exchange ratio is fixed and will be adjusted only in certain circumstances, including if Brunswick’s consolidated shareholders’ equity is less than certain minimum requirements, Mid Penn effects a stock split or reverse stock split, and the market price of Mid Penn common stock will fluctuate prior to the merger, the pro forma equivalent price per share of Brunswick common stock will also fluctuate prior to the merger. Brunswick shareholders will not know the final equivalent price per share of Brunswick common stock when they vote on the merger. This information relates to the value of shares of Brunswick common stock that will be converted into shares of Mid Penn common stock in the merger. You should obtain current stock price quotations for the shares.
Following completion of the merger, current Mid Penn shareholders will own in the aggregate approximately ninety-four and six tenths percent (94.6%) of the outstanding shares of Mid Penn common stock and Brunswick shareholders will own approximately five and four tenths percent (5.4%) of the outstanding shares of Mid Penn common stock.
Opinion of Brunswick’s Financial Advisor (page 39)
At the December 20, 2022 meeting at which the Brunswick board of directors considered and approved the merger agreement, Brunswick’s financial advisor, Janney Montgomery Scott LLC, or Janney, delivered its oral opinion to Brunswick’s board of directors, which was subsequently confirmed in writing, to the effect that, as of December 20, 2022, subject to the procedures followed, assumptions made, matters considered and qualifications and limitations described in Janney’s opinion, the Merger Consideration was fair, from a financial point of view, to Brunswick common equity shareholders.
The full text of Janney’s opinion is attached as Annex B to this joint proxy statement/prospectus. The opinion outlines the procedures followed, assumptions made, matters considered and qualifications and limitations on the review undertaken by Janney in rendering its opinion.
Brunswick shareholders should read the opinion and the summary description of Janney’s opinion contained in this joint proxy statement/prospectus carefully in their entirety.
Janney’s opinion speaks only as of the date of the opinion. The opinion of Janney does not reflect any developments that may have occurred or may occur after the date of its opinion and prior to the completion of the merger. Brunswick does not expect that it will request an updated opinion from Janney. The opinion was directed to Brunswick’s board of directors in connection with its consideration of the merger and is directed only as to the fairness, from a financial point of view, of the merger consideration to Brunswick common equity shareholders. Janney’s opinion does not constitute a recommendation to any Brunswick shareholder as to how such shareholder should vote at any meeting of shareholders called to consider and vote upon the Brunswick merger proposal. Janney’s opinion does not address the underlying business decision of Brunswick to engage in the merger, the form or structure of the merger, the relative merits of the merger as compared to any other alternative business strategies that might exist for Brunswick or the effect of any other transaction in which Brunswick might engage. Janney did not express any opinion as to the fairness of the amount or nature of the compensation to be received in the merger by Brunswick’s officers, directors, or employees, or class of such persons, if any, relative to the compensation to be received in the merger by any other shareholder of Brunswick.
For further information, see “The Merger—Opinion of Brunswick’s Financial Advisor.”
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Opinion of Mid Penn’s Financial Advisor (page 51)
At the December 20, 2022 meeting at which the Mid Penn board of directors considered and approved the merger agreement, Mid Penn’s financial advisor, Piper Sandler & Co., or Piper Sandler, delivered its oral opinion to Mid Penn’s board of directors, which was subsequently confirmed in writing, to the effect that, as of December 20, 2022, subject to the procedures followed, assumptions made, matters considered and qualifications and limitations described in Piper Sandler’s opinion, the Merger Consideration was fair, from a financial point of view, to Mid Penn.
The full text of Piper Sandler’s opinion is attached as Annex C to this joint proxy statement/prospectus. The opinion outlines the procedures followed, assumptions made, matters considered and qualifications and limitations on the review undertaken by Piper Sandler in rendering its opinion.
Mid Penn shareholders should read the opinion and the summary description of Piper Sandler’s opinion contained in this joint proxy statement/prospectus carefully in their entirety.
Piper Sandler’s opinion speaks only as of the date of the opinion. The opinion of Piper Sandler does not reflect any developments that may have occurred or may occur after the date of its opinion and prior to the completion of the merger. Mid Penn does not expect that it will request an updated opinion from Piper Sandler. The opinion was directed to Mid Penn’s board of directors in connection with its consideration of the merger and is directed only as to the fairness, from a financial point of view, of the Merger Consideration to Mid Penn. Piper Sandler’s opinion does not constitute a recommendation to any Mid Penn shareholder as to how such shareholder should vote at any meeting of shareholders called to consider and vote upon the Mid Penn merger proposal. Piper Sandler’s opinion does not address the underlying business decision of Mid Penn to engage in the merger, the form or structure of the merger, the relative merits of the merger as compared to any other alternative business strategies that might exist for Mid Penn or the effect of any other transaction in which Mid Penn might engage. Piper Sandler did not express any opinion as to the fairness of the amount or nature of the compensation to be received in the merger by Mid Penn’s officers, directors, or employees, or class of such persons, if any, relative to the compensation to be received in the merger by any other shareholder of Mid Penn.
For further information, see “The Merger—Opinion of Mid Penn’s Financial Advisor.”
Board of Directors and Executive Officers of Mid Penn after the Merger (page 64)
Following completion of the merger, the then current directors and executive officers of Mid Penn and Mid Penn Bank will continue in office and one (1) of the current directors of Brunswick selected by the board of directors of Brunswick, with the approval of Mid Penn’s board of directors, will be added to the board of directors of Mid Penn.
The Mid Penn Board of Directors Recommends That Mid Penn Shareholders Vote “FOR” the Mid Penn Merger Proposal, “FOR” Mid Penn Amendment Proposal 1 and “FOR” Mid Penn Amendment Proposal 2 (pages 89-91)
The Mid Penn board of directors believes that the merger is in the best interests of Mid Penn and has unanimously approved the merger and the merger agreement. The Mid Penn board of directors recommends that Mid Penn shareholders vote “FOR” approval of the Mid Penn merger proposal. The Mid Penn board also recommends that its shareholders vote “FOR” Mid Penn amendment proposal 1, Mid Penn amendment proposal 2 and the Mid Penn adjournment proposal.
The Brunswick Board of Directors Recommends That Brunswick Shareholders Vote “FOR” the Brunswick Merger Proposal (page 95)
The Brunswick board of directors believes that the merger is in the best interests of Brunswick and has unanimously approved the merger and the merger agreement. The Brunswick board of directors recommends that
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Brunswick shareholders vote “FOR” the Brunswick merger proposal. The Brunswick board of directors also recommends a vote “FOR” approval of the Brunswick adjournment proposal.
Brunswick’s Directors and Executive Officers Have Financial Interests in the Merger that May Differ from the Interests of Brunswick Shareholders (page 66)
In addition to their interests as Brunswick shareholders, the directors and certain executive officers of Brunswick have interests in the merger that are different from or in addition to interests of other Brunswick shareholders. These interests include, among other things:
the appointment, effective at the closing of the merger, of one (1) member of the board of directors of Brunswick to the board of directors of Mid and the payment of compensation to such individual in accordance with the policies of Mid Penn;
the continued indemnification of current directors and executive officers of Brunswick and its subsidiaries pursuant to the terms of the merger agreement;
certain of Brunswick’s named executive officers will be entitled to severance, change-in-control or other benefits and payments in connection with the merger; and
the acceleration of vesting of unvested Brunswick options and restricted stock grants held by Brunswick directors and officers, and the conversion of such Brunswick options into the right to receive cash following the merger.
Brunswick’s board of directors was aware of these interests and took them into account in its decision to approve the agreement and plan of merger. For information concerning these interests, please see the discussion on page 66 under the caption “Interests of Brunswick’s Directors and Executive Officers in the Merger.”
Brunswick Shareholders Do Not Have Dissenters’ Rights or Appraisal Rights (page 64)
Shareholders of Brunswick will not have appraisal or dissenters’ rights in connection with the merger. See “Brunswick Shareholders Do Not Have Dissenters’ Rights in the Merger” beginning on page 64.
The Rights of Brunswick Shareholders Will Change After the Merger (page 100)
The rights of Brunswick shareholders will change as a result of the merger due to differences in Mid Penn’s and Brunswick’s governing documents and the statutes governing each. The rights of Brunswick’s shareholders are governed under New Jersey law and by Brunswick’s certificate of incorporation and bylaws. Upon completion of the merger, Brunswick shareholders who become Mid Penn shareholders will be governed under Pennsylvania law and by Mid Penn’s articles of incorporation and bylaws. A description of shareholder rights under each of the Mid Penn and Brunswick governing documents, and the material differences between them, is included in the section entitled “Comparison of Shareholders’ Rights” found on page 100.
Conditions That Must Be Satisfied or Waived for the Merger to Occur (page 80)
Currently, we expect to complete the merger in the second quarter of 2023. In addition to the approval of the merger proposal by the requisite vote of Mid Penn and Brunswick shareholders and the receipt of all required regulatory approvals and expiration or termination of all statutory waiting periods in respect thereof, each as described herein, each party’s obligation to complete the merger is also subject to the satisfaction or waiver (to the extent permitted under applicable law) of certain other conditions, including the effectiveness of the registration statement containing this joint proxy statement/prospectus, approval of the listing on the Nasdaq Stock Market of the Mid Penn common stock to be issued in the merger, the absence of any applicable law or order prohibiting the merger, the accuracy of the representations and warranties of each party under the merger agreement (subject to the materiality standards set forth in the merger agreement), the performance by each party of its respective obligations under the merger agreement in all material respects, delivery of officer’s certificates by each party certifying satisfaction of the two preceding conditions and each of Mid Penn’s and Brunswick’s receipt of a tax opinion to the effect that the merger will be treated as a “reorganization” within the meaning of Section 368(a) of the Code. In
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addition, Brunswick Bank and Trust Company’s allowance for credit losses must equal or exceed one percent (1%) of total loans.
Neither Brunswick nor Mid Penn can be certain when, or if, the conditions to the merger will be satisfied or waived, or that the merger will be completed. For more information concerning the closing conditions of the merger, please see the discussion on page 73 under the caption “The Merger Agreement—Covenants and Agreements.”
No Solicitation of Other Offers (page 77)
Brunswick has agreed that it will not, and Brunswick will cause its subsidiaries and each of their respective officers, directors, employees, representatives, agents, and affiliates not to, except as otherwise expressly permitted in the merger agreement, between the date of the merger agreement and the closing of the merger, directly or indirectly:
initiate, solicit, induce or encourage, or take any action to facilitate the making of, any inquiry, offer or proposal that constitutes, relates or could reasonably be expected to lead to an alternative acquisition proposal;
respond to any inquiry relating to an alternative acquisition proposal;
recommend or endorse an alternative acquisition transaction;
participate in any discussions or negotiations regarding an alternative acquisition proposal, or furnish or afford access to confidential or non-public information or data to any person;
release anyone from, waive any provisions of, or fail to enforce any confidentiality agreement or standstill agreement to which Brunswick is a party; or
enter into any agreement, agreement in principle or letter of intent with respect to any alternative acquisition proposal or approve or resolve to approve any alternative acquisition proposal or any agreement, agreement in principle or letter of intent relating to an alternative acquisition proposal.
The merger agreement does not, however, prohibit Brunswick from furnishing information or access to a third party who has made an unsolicited alternative acquisition proposal and participating in discussions and negotiating with such person if specified conditions are met. Among those conditions is a good faith determination by Brunswick’s board of directors that the acquisition proposal constitutes or that could reasonably be expected to lead to a proposal that is more favorable, from a financial point of view, to Brunswick and its shareholders than the transactions contemplated by the merger agreement and is reasonably capable of being completed on its stated terms, taking into account all financial, regulatory, legal and other aspects of the proposal.
For further discussion of the restrictions on solicitation of acquisition proposals from third parties, see “The Merger Agreement—Agreement Not to Solicit Other Offers” beginning on page 77.
Termination of the Merger Agreement (page 81)
We may mutually agree to terminate the merger agreement before completing the merger, even after Brunswick or Mid Penn shareholder approval. In addition, either of us may decide to terminate the merger agreement, if (i) a court or governmental entity issues a final order that is not appealable prohibiting the merger, (ii) a bank regulator which must grant a regulatory approval as a condition to the merger denies such approval of the merger and such denial has become final and is not appealable, (iii) the shareholders of Mid Penn or Brunswick fail to approve the merger at their respective special meetings, or (iv) the other party breaches the merger agreement in a way that would entitle the party seeking to terminate the agreement not to consummate the merger, subject to the right of the breaching party to cure the breach within thirty (30) days following written notice. Either of us may terminate the merger agreement if the merger has not been completed by September 30, 2023, unless the reason the merger has not been completed by that date is a breach of the merger agreement by the company seeking to terminate the merger agreement.
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Mid Penn may terminate the merger agreement if the Brunswick board of directors, in connection with the receipt of a superior alternative acquisition proposal, (1) enters into a letter of intent, agreement in principle or an acquisition agreement with respect to the superior alternative acquisition proposal, (2) fails to make, withdraws, modifies or qualifies its recommendation of the merger agreement in a manner adverse to Mid Penn, or (3) has otherwise made a determination to accept the superior alternative acquisition proposal.
Brunswick Bank and Trust Company’s general allowance for credit losses shall be an amount not less than one percent (1%) of total loans and leases outstanding. If it is not, Mid Penn may terminate the merger agreement.
Brunswick may terminate the merger agreement if Brunswick receives an alternative acquisition proposal and has made a determination that the alternative acquisition proposal is a superior proposal and accepts such alternative acquisition proposal.
Termination Fee (page 81)
Brunswick will pay Mid Penn a termination fee of Two Million Fifty Thousand Dollars ($2,050,000) if the merger agreement is terminated:
by Mid Penn because Brunswick has received a superior alternative acquisition proposal, and Brunswick (1) enters into a letter of intent, agreement in principle or an acquisition agreement with respect to the superior alternative acquisition proposal, (2) fails to make, withdraws, modifies or qualifies its recommendation of the merger agreement in a manner adverse to Mid Penn, or (3) has otherwise made a determination to accept the superior alternative acquisition proposal; or
by Brunswick, if Brunswick receives an alternative acquisition proposal and has made a determination that the alternative acquisition proposal is a superior proposal and accepts such alternative acquisition proposal in accordance with the terms of the merger agreement.
Brunswick will also be required to pay Mid Penn the termination fee of Two Million Fifty Thousand Dollars ($2,050,000) in the event that Brunswick enters into a definitive agreement relating to, or consummates, an acquisition proposal within twelve (12) months following termination of the merger agreement:
by Mid Penn because of a willful breach of the merger agreement by Brunswick; or
by either Mid Penn or Brunswick, if the shareholders of Brunswick failed to approve the merger and either Brunswick breached the non-solicitation provisions of the merger agreement or a third party publicly proposed or announced an alternative acquisition proposal.
Regulatory Approvals Required for the Merger (page 64)
Completion of the merger and the bank merger are subject to the receipt of all approvals required by, or waivers from, applicable regulatory authorities. The transaction is subject to approval by the Federal Deposit Insurance Corporation (the “FDIC”), the Pennsylvania Department of Banking and Securities (the “PDB”) and the New Jersey Department of Banking and Insurance (“NJDB”) and approval, or waiver of formal application and approval requirements, from the Board of Governors of the Federal Reserve System (the “FRB”). Mid Penn has filed or will file all required applications, notices and waiver requests to obtain the regulatory approvals and non-objections necessary to consummate the merger. While Mid Penn does not know of any reason why it would not obtain the approvals in a timely manner, Mid Penn cannot be certain when or if it will receive the regulatory approvals.
Notifications and/or applications requesting approval may also be submitted to various other federal and state regulatory authorities and self-regulatory organizations. Mid Penn and Brunswick have agreed to use their reasonable best efforts to obtain all required regulatory approvals.
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Risk Factors (page 24)
You should consider all the information contained in or incorporated by reference into this joint proxy statement/prospectus in deciding how to vote for the proposals presented in the joint proxy statement/prospectus. In particular, you should consider the factors described under “Risk Factors.”
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The following table provides historical consolidated summary financial data for Mid Penn. The data for the years ended December 31, 2021, 2020, 2019, 2018 and 2017 are derived from Mid Penn’s audited financial statements as of or for the periods then ended. The results of operations for the nine months ended September 30, 2022 and 2021 are not necessarily indicative of the results of operations for the full year or any other interim period. Mid Penn’s management prepared the unaudited information on the same basis as it prepared Mid Penn’s audited consolidated financial statements. In the opinion of Mid Penn’s management, this information reflects all adjustments, consisting of only normal recurring adjustments, necessary for a fair presentation of this data for those dates.
SELECTED CONSOLIDATED HISTORICAL FINANCIAL DATA OF MID PENN
Nine Months EndedYear Ended December 31,
(Dollars in thousands, except per share data)Sept 30, 2022Sept 30, 202120212020201920182017
INCOME:
Total Interest Income$118,858 $90,637 $123,322 $107,935 $95,312 $68,654 $43,892 
Total Interest Expense9,602 11,441 14,754 19,727 25,164 12,720 6,304 
Net Interest Income109,256 79,196 108,568 88,208 70,148 55,934 37,588 
Provision (Credit) for Loan and Lease Losses3,775 2,575 2,945 4,200 1,390 500 325 
Noninterest Income16,943 15,873 21,533 17,908 12,621 7,462 5,693 
Noninterest Expense74,375 57,033 91,105 70,577 59,953 50,171 31,367 
Income Before Provision for Income Taxes48,049 35,461 36,051 31,339 21,426 12,725 11,589 
Provision (Credit) for Income Taxes8,962 6,749 6,732 5,130 3,725 2,129 4,500 
Net Income39,087 28,712 29,319 26,209 17,701 10,596 7,089 
COMMON STOCK DATA PER SHARE:
Earnings Per Common Share (Basic)$2.45 $2.85 $2.71 $3.11 $2.09 $1.48 $1.67 
Earnings Per Common Share (Fully Diluted)2.45 2.85 2.71 3.10 2.09 1.48 1.67 
Cash Dividends Declared0.60 0.59 0.79 0.82 0.79 0.45 0.77 
Cash Dividends Paid0.60 0.64 0.84 0.77 0.79 0.70 0.62 
Book Value Per Common Share31.42 30.55 30.71 30.37 28.05 26.38 17.85 
Tangible Book Value Per Common Share23.80 24.74 22.99 22.39 19.96 18.10 16.82 
AVERAGE SHARES OUTSTANDING (BASIC):15,922,945 10,064,655 10,806,009 8,439,427 8,468,586 7,071,091 4,236,616 
AVERAGE SHARES OUTSTANDING (FULLY DILUTED):15,945,274 10,077,408 10,819,579 8,443,092 8,492,073 7,091,797 4,252,561 
BALANCE SHEET DATA:
Available-For-Sale Investment Securities, at Fair Value$242,195 $5,015 $62,862 $5,748 $37,009 $111,923 $93,465 
Held-For-Sale Investment Securities, at Amortized Cost402,142 152,791 329,257 128,292 136,477 168,370 101,356 
Loans and Leases, Net of Unearned Interest3,322,457 2,370,429 3,104,396 2,384,041 1,762,756 1,624,067 910,404 
Allowance for Loan and Lease Losses18,480 14,233 14,597 13,382 9,515 8,397 7,606 
Total Assets4,333,903 3,453,187 4,689,425 2,998,948 2,231,175 2,077,981 1,170,354 
Total Deposits3,729,596 2,961,881 4,002,016 2,474,580 1,912,394 1,726,026 1,023,568 
Short-term Borrowings— — — 125,617 — 43,100 34,611 
Long-term Debt4,501 74,858 81,270 75,115 32,903 48,024 12,352 
Subordinated Debt66,357 44,599 74,274 44,580 27,070 27,082 17,338 
Shareholders' Equity499,105 349,308 490,076 255,688 237,874 223,209 75,703 
RATIOS:
Return on Average Assets1.16 %1.14 %0.83 %0.95 %0.82 %0.63 %0.64 %
Return on Average Shareholders' Equity10.52 %12.55 %8.91 %10.76 %7.67 %5.98 %9.48 %
Cash Dividend Payout Ratio24.44 %22.43 %30.96 %24.76 %37.80 %47.30 %37.13 %
Allowance for Loan and Lease Losses to Loans and Leases, Net of Unearned Interest0.56 %0.60 %0.47 %0.56 %0.54 %0.52 %0.84 %
Average Shareholders' Equity to Average Assets11.04 %9.05 %11.09 %8.83 %10.65 %10.54 %6.78 %
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The following table provides historical consolidated summary financial data for Brunswick. The data for the years ended December 31, 2021, 2020, 2019, 2018 and 2017 are derived from Brunswick’s audited financial statements as of or for the periods then ended. The results of operations for the nine months ended September 30, 2022 and 2021 are not necessarily indicative of the results of operations for the full year or any other interim period. Brunswick’s management prepared the unaudited information on the same basis as it prepared Brunswick’s audited consolidated financial statements. In the opinion of Brunswick’s management, this information reflects all adjustments, consisting of only normal recurring adjustments, necessary for a fair presentation of this data for those dates.
SELECTED CONSOLIDATED HISTORICAL FINANCIAL DATA OF BRUNSWICK
Nine Months EndedYear Ended December 31,
(Dollars in thousands, except per share data)Sept 30, 2022Sept 30, 202120212020201920182017
INCOME:
Total Interest Income$11,029 $9,716 $13,219 $11,404 $10,452 $8,799 $8,122 
Total Interest Expense1,225 1,166 1,517 2,374 2,442 1,512 1,113 
Net Interest Income9,804 8,550 11,702 9,030 8,010 7,287 7,009 
Provision (Credit) for Loan Losses160 310 310 525 — — 84 
Noninterest Income803 904 1,794 3,391 1,300 1,408 1,264 
Noninterest Expense6,616 6,202 8,476 8,147 7,541 6,930 6,996 
Income Before Provision for Income Taxes3,831 2,942 4,710 3,749 1,769 1,765 1,193 
Provision (Credit) for Income Taxes1,035 812 1,343 1,044 502 519 668 
Net Income2,796 2,130 3,367 2,705 1,267 1,246 525 
COMMON STOCK DATA PER SHARE:
Earnings Per Common Share (Basic)$0.99 $0.76 $1.19 $0.96 $0.45 $0.44 $0.17 
Earnings Per Common Share (Fully Diluted)0.96 0.74 1.17 0.96 0.45 0.44 0.17 
Cash Dividends Declared339 705 705 — — — — 
Cash Dividends Paid339 705 705 — — — — 
Book Value Per Common Share15.17 15.46 15.82 15.04 14 13.43 12.36 
Tangible Book Value Per Common Share15.17 15.46 15.82 15.04 14 13.43 12.36 
AVERAGE SHARES OUTSTANDING (BASIC):2,816,628 2,785,888 2,786,610 2,770,141 2,783,702 2,804,350 3,088,235 
AVERAGE SHARES OUTSTANDING (FULLY DILUTED):2,904,765 2,834,120 2,829,747 2,770,141 2,783,702 2,804,350 3,088,235 
BALANCE SHEET DATA:
Available-For-Sale Debt Securities, at Fair Value$40,656 $42,845 $39,758 $36,839 $6,091 $6,389 $7,757 
Held-For-Sale Debt Securities, at Amortized Cost1,857 2,625 2,367 3,524 4,947 6,149 7,591 
Loans receivable, Net of Unearned Interest302,460 270,754 279,387 240,336 196,493 166,608 142,082 
Allowance for Loan Losses3,021 2,859 2,864 2,450 1,902 1,938 1,932 
Total Assets381,631 361,186 372,193 315,966 239,784 203,884 184,908 
Total Deposits279,822 273,037 277,603 232,235 194,100 163,387 145,986 
Short-term Borrowings13,000 — — — — — — 
Long-term Debt42,272 41,636 47,172 37,427 3,200 — — 
Subordinated Debt— — — — — — — 
Stockholders' Equity43,104 43,568 44,593 42,291 39,372 38,200 37,394 
RATIOS:
Return on Average Assets0.99 %0.82 %0.98 %0.97 %0.57 %0.64 %0.29 %
Return on Average Stockholders' Equity8.36 %6.75 %7.75 %6.62 %3.27 %3.30 %1.41 %
Cash Dividend Payout Ratio9.07 %24.76 %20.94 %0.00 %0.00 %0.00 %0.00 %
Allowance for Loan Losses to Loans receivable, Net of Unearned Interest1.00 %1.06 %1.03 %1.02 %0.97 %1.16 %1.36 %
Average Stockholders' Equity to Average Assets11.89 %12.12 %12.63 %14.69 %17.48 %19.44 %20.31 %
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RISK FACTORS
In considering whether to vote in favor of the proposal to adopt the merger agreement, you should consider all of the information included in this document and its annexes and all of the information we have incorporated by reference and the risk factors identified by Mid Penn with respect to its operations included in its filings with the SEC, including in its Annual Report on Form 10-K for the year ended December 31, 2021 and subsequent Quarterly Reports on Form 10-Q. See “Incorporation of Certain Documents by Reference.” In addition, you should consider the following risk factors.
Risks Related to the Merger
The value of the Merger Consideration, while fixed, will vary with changes in Mid Penn’s stock price and may be adjusted if certain minimum equity targets are not achieved by Brunswick. Due to this, the number of shares of Mid Penn common stock exchanged per share of Brunswick common stock and the Cash Consideration to be paid for each share of Brunswick common stock may be different at the closing of the merger than when the merger agreement was executed and when Brunswick’s shareholder’s meeting is held.
Upon completion of the merger, each share of Brunswick common stock will be converted into the right to receive the Merger Consideration, consisting of, at the option of the holder of such share and subject to proration and adjustment as described in the merger agreement, either Eighteen Dollars ($18.00) (the “Cash Consideration”) or 0.598 shares of Mid Penn common stock (the “Stock Consideration”). Both the Stock Consideration and Cash Consideration are fixed, but are subject to downward adjustment pursuant to the merger agreement if Brunswick does not, at certain measuring dates, have a specific amount of consolidated shareholders’ equity calculated in accordance with the merger agreement. Moreover, the value of the Stock Consideration will depend on the market price of Mid Penn common stock. Stock price changes may result from a variety of factors (many of which are outside the control of Mid Penn).
The market price of Mid Penn common stock at the closing of the merger may vary from its price on the date the merger agreement was executed, on the date of this joint proxy statement/prospectus and on the date of Mid Penn’s and Brunswick’s shareholder meetings. As a result, the market value of the Stock Consideration also will vary.
Thus, while the number of shares of Mid Penn common stock to be issued per share of Brunswick common stock is fixed (absent any adjustments as described above), (A) Mid Penn shareholders cannot be sure of the market value of the Stock Consideration that will ultimately be paid upon completion of the merger and (B) Brunswick shareholders cannot be sure of the market value of the Stock Consideration they will ultimately receive upon completion of the merger. Moreover, even though the Cash Consideration is fixed, because of the adjustment mechanisms in the merger agreement, Mid Penn and Brunswick shareholders cannot be sure of the ultimate value of the Cash Consideration when voting at their respective shareholder meetings.
Brunswick shareholders may receive a form of consideration different from what they elect.
While each Brunswick shareholder may elect to receive the Cash Consideration, the Stock Consideration or a mix of both, fifty percent (50%) of the Brunswick stock outstanding at the completion of the merger will be converted into the Cash Consideration and fifty percent (50%) will be converted into the Stock Consideration. Therefore, if Brunswick shareholders elect more cash or stock than is available under the merger agreement, their elections will be prorated so that fifty percent (50%) of the Brunswick common stock outstanding at the completion of the merger is converted into the Stock Consideration and the remaining fifty percent (50%) is converted into the Cash Consideration. As a result, a Brunswick shareholder’s ability to receive cash or stock in accordance with their election may depend on the election of other Brunswick shareholders.
Brunswick and Mid Penn shareholders will have a reduced ownership percentage and voting interest after the merger and will exercise less influence over management.
Brunswick’s shareholders currently have the right to vote in the election of the board of directors of Brunswick and on certain other matters affecting Brunswick. When the merger occurs, each Brunswick shareholder that receives shares of Mid Penn common stock will become a shareholder of Mid Penn with a percentage ownership of the
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combined organization that is much smaller than the shareholder’s current percentage ownership of Brunswick. Additionally, each Mid Penn shareholder will have a percentage ownership of the combined organization that is smaller than the shareholder’s current ownership in Mid Penn. More specifically, following completion of the merger, current Mid Penn shareholders will own in the aggregate approximately ninety-four and six tenths percent (94.6%) of the outstanding shares of Mid Penn common stock and Brunswick shareholders will own approximately five and four tenths percent (5.4%) of the outstanding shares of Mid Penn common stock.
Because of this, each institution’s existing shareholders will have less influence on the management and policies of Mid Penn than they now have on the management and policies of the institution in which they currently own shares.
The merger agreement limits Brunswick’s ability to pursue alternatives to the merger.
The merger agreement contains “no shop” provisions that, subject to specified exceptions, limit Brunswick’s ability to discuss, facilitate or commit to competing third-party proposals to acquire all or a significant part of Brunswick. In addition, a termination fee is payable by Brunswick under certain circumstances, generally involving the decision to pursue an alternative transaction. These provisions might discourage a potential competing acquiror that might have an interest in acquiring all or a significant part of Brunswick from considering or proposing that acquisition, even if it were prepared to pay consideration with a higher per share value than that proposed in the merger, or might result in a potential competing acquiror proposing to pay a lower per share price to acquire Brunswick than it might otherwise have proposed to pay, if the merger with Mid Penn had not been announced.
Regulatory waivers and approvals may not be received or may be received and subsequently expire, be revoked or be amended to impose conditions that are not presently anticipated or cannot be met.
Before the transactions contemplated in the merger agreement, including the merger, may be completed, various waivers, approvals or consents must be obtained from various bank regulatory and other authorities, including the FRB, the FDIC, the PDB and NJDB. These governmental entities may impose conditions on the completion of the merger or require changes to the terms of the merger agreement. Further, such approvals are subject to expiration if the transaction is not consummated within the time period provided in the approval.
Brunswick’s directors and executive officers have financial interests in the merger that may be different from, or in addition to, the interests of Brunswick shareholders.
Brunswick’s directors and executive officers have financial interests in the merger that may be different from, or in addition to, the interests of Brunswick shareholders. For example, one (1) current director of Brunswick will serve on the board of directors of Mid Penn after the merger and will receive compensation for his or her services as a director. In addition, certain officers or employees may receive certain severance payments if they are terminated following the merger. Moreover, certain executive officers will receive change in control payments following completion of the merger. For information concerning these interests, please see the discussion under the caption “Interests of Brunswick’s Directors and Executive Officers in the Merger” on page 66.
The shares of Mid Penn common stock to be received by Brunswick shareholders as a result of the merger will have different rights from the shares of Brunswick common stock.
Upon completion of the merger, Brunswick shareholders will become Mid Penn shareholders. Their rights as shareholders will be governed by Pennsylvania corporate law and the articles of incorporation and bylaws of Mid Penn. The rights associated with Brunswick common stock are governed by New Jersey corporate law and the certificate of incorporation and bylaws of Brunswick and are different from the rights associated with Mid Penn common stock. See the section of this joint proxy statement/prospectus titled “Comparison of Shareholders’ Rights” beginning on page 100 for a discussion of the different rights associated with Mid Penn common stock.
Termination of the merger agreement could negatively affect Brunswick.
If the merger agreement is terminated, there may be various consequences, including the fact that Brunswick’s businesses may have been adversely impacted by the failure to pursue other beneficial opportunities due to the focus of management on the merger, without realizing any of the anticipated benefits of completing the merger.
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If the merger agreement is terminated and Brunswick’s board of directors seeks another merger or business combination, Brunswick shareholders cannot be certain that Brunswick will be able to find a party willing to offer equivalent or more attractive consideration than the consideration Mid Penn has agreed to provide in the merger.
If the merger agreement is terminated and a different business combination is pursued, Brunswick may be required to pay a termination fee of Two Million Fifty Thousand Dollars ($2,050,000) to Mid Penn under certain circumstances. See “The Merger Agreement—Termination Fee” beginning on page 81.
The fairness opinions obtained by Brunswick and Mid Penn from their respective financial advisors will not reflect changes in circumstances subsequent to the date that such opinions were rendered.
Brunswick has obtained a fairness opinion dated as of December 20, 2022, from its financial advisor, Janney. Mid Penn has obtained a fairness opinion dated as of December 20, 2022, from its financial advisor, Piper Sandler. Neither Brunswick nor Mid Penn has obtained, and neither will obtain, an updated opinion as of the date of this joint proxy statement/prospectus from their respective financial advisor. Changes in the operations and prospects of Mid Penn or Brunswick, general market and economic conditions and other factors that may be beyond the control of Mid Penn and Brunswick may alter the value of Mid Penn or Brunswick or the price of shares of Mid Penn common stock or Brunswick common stock by the time the merger is completed. The opinions do not speak to the time the merger will be completed or to any other date other than the date of such opinions. As a result, the opinions will not address the fairness of the Merger Consideration, from a financial point of view, at the time the merger is completed. For a description of the opinion that Brunswick received from Janney, please see “The Merger—Opinion of Brunswick’s Financial Advisor” beginning on page 39 of this joint proxy statement/prospectus. For a description of the opinion that Mid Penn received from Piper Sandler, please see “The Merger—Opinion of Mid Penn’s Financial Advisor” beginning on page 51 of this joint proxy statement/prospectus.
The merger agreement may be terminated in accordance with its terms and the merger may not be completed for other reasons.
The merger agreement is subject to a number of conditions that must be fulfilled in order to complete the merger. Those conditions include, among others: approval of the merger agreement by Mid Penn and Brunswick shareholders, regulatory approvals, absence of orders prohibiting the completion of the merger, effectiveness of the registration statement of which this joint proxy statement/prospectus is a part, approval of the shares of Mid Penn common stock to be issued to Brunswick shareholders for listing on the Nasdaq Global Market, the continued accuracy of the representations and warranties by both parties, the performance by both parties of their covenants and agreements, and the receipt by both parties of legal opinions from their respective tax counsels. See “The Merger Agreement—Termination of the Merger Agreement” beginning on page 81 for a more complete discussion of the circumstances under which the merger agreement could be terminated. The conditions to closing of the merger may not be fulfilled and the merger may not be completed.
Failure to complete the merger could negatively affect the market price of Mid Penn’s and Brunswick’s common stock.
If the merger is not completed for any reason, Mid Penn and Brunswick will be subject to a number of material risks, including the following:
the market price of Brunswick common stock may decline to the extent that the current market prices of its common stock already reflect a market assumption that the merger will be completed;
costs relating to the merger, such as legal, accounting and financial advisory fees, and, in specified circumstances, additional reimbursement and termination fees, must be paid even if the merger is not completed; and
the diversion of management’s attention from the day-to-day business operations and the potential disruption to each company’s employees and business relationships during the period before the completion of the merger may make it difficult to regain financial and market positions if the merger does not occur.
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Brunswick will be subject to business uncertainties and contractual restrictions while the merger is pending.
Uncertainty about the effect of the merger on employees and customers may have an adverse effect on Brunswick and consequently on Mid Penn. These uncertainties may impair Brunswick’s ability to attract, retain and motivate key personnel until the merger is consummated, and could cause customers and others that deal with Brunswick to seek to change existing business relationships with Brunswick. Retention of certain employees may be challenging while the merger is pending, as certain employees may experience uncertainty about their future roles with Mid Penn. If key employees depart because of issues relating to the uncertainty and difficulty of integration or a desire not to remain with Mid Penn, Mid Penn’s business following the merger could be harmed. In addition, the merger agreement restricts Brunswick from taking certain actions until the merger occurs without the consent of Mid Penn. These restrictions may prevent Brunswick from pursuing attractive business opportunities that may arise prior to the completion of the merger. Please see the section entitled “The Merger Agreement—Covenants and Agreements” beginning on page 73 of this joint proxy statement/prospectus for a description of the restrictive covenants to which Brunswick is subject under the merger agreement.
If the merger is not completed, Brunswick and Mid Penn will have incurred substantial expenses without realizing the expected benefits of the merger.
Brunswick and Mid Penn have both incurred substantial expenses in connection with the merger. The completion of the merger depends on the satisfaction of specified conditions and the continued effectiveness of regulatory approvals and the approval of Mid Penn’s and Brunswick’s shareholders. Brunswick and Mid Penn cannot guarantee that these conditions will be met. If the merger is not completed, these expenses could have an adverse impact on the financial condition and results of operations on a stand-alone basis for both Brunswick and Mid Penn.
Litigation relating to the merger could require us to incur significant costs and suffer management distraction, as well as delay and/or enjoin the merger.
Neither Brunswick nor Mid Penn is currently able to predict the outcome of any suit arising out of or relating to the proposed transaction that may be filed in the future. If any letters or complaints are filed, absent allegations that are material, Brunswick and Mid Penn will not necessarily announce such filings.
Brunswick and Mid Penn could be subject to demands or litigation related to the merger, whether or not the merger is consummated. Such actions may create additional uncertainty relating to the merger, and responding to such demands and defending such actions may be costly and distracting to management. Although there can be no assurance as to the ultimate outcomes of any demand or any subsequent litigation, neither Brunswick nor Mid Penn believes that the resolution of such demands or any subsequent litigation will have a material adverse effect on its respective financial position, results of operations or cash flows.
Risks Related to the Combined Company if the Merger is Completed
Mid Penn may be unable to successfully integrate Brunswick’s operations and retain Brunswick’s employees.
The merger involves the integration of two companies that have previously operated independently. The difficulties of combining the operations of the two companies include, among other things: integrating personnel with diverse business backgrounds; combining different corporate cultures; and retaining key employees.
The process of integrating operations could cause an interruption of, or loss of momentum in, the activities of the business and the loss of key personnel. The integration of the two companies will require the experience and expertise of certain key employees of Brunswick who are expected to be retained by Mid Penn. Mid Penn may not be successful in retaining these employees for the time period necessary to successfully integrate Brunswick’s operations with those of Mid Penn. The diversion of management’s attention and any delays or difficulties encountered in connection with the merger and the integration of the two companies’ operations could have an adverse effect on the business and results of operations of Mid Penn following the merger.
Additionally, Mid Penn may not be able to successfully achieve the level of cost savings and other synergies that it expects, and may not be able to capitalize upon the existing customer relationships of Brunswick to the extent
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anticipated, or it may take longer, or be more difficult or expensive than expected to achieve these goals. This could have an adverse effect on Mid Penn’s business, results of operation and stock price.
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 Brunswick.
The businesses of Mid Penn and Brunswick 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 Brunswick, see “Information about Mid Penn Bancorp, Inc.” and “Information about Brunswick Bancorp” on pages 92 and 96, 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 20 million shares of common stock, which is the maximum number of shares Mid Penn may have issued and outstanding at any one time. If Mid Penn amendment proposal 1 is approved, Mid Penn will be authorized to issue up to 40 million shares of common stock. 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 Brunswick. However, to realize these anticipated benefits and cost savings, which include increased Mid Penn lending limits, a presence in new geographic markets and access to stable core deposits, we must successfully combine the businesses of Mid Penn and Brunswick. 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 Brunswick 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 Brunswick 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 Brunswick’s existing customers and to new customers in Brunswick’s market area who may be attracted by the combined company’s enhanced offerings. An inability to successfully market Mid Penn’s products to Brunswick’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 Brunswick believe that they have reasonably estimated the likely incremental costs of the combined operations of Mid Penn and Brunswick 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 Brunswick’s loan or securities portfolios, could have a material adverse effect on the results of operations and financial condition of Mid Penn
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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.
The current volatile interest rate and credit risk environment may adversely impact the fair value adjustments of investments and loans acquired in the merger.
Upon the closing of the merger, the combined company will need to adjust the fair value of Brunswick’s investment and loan portfolios. The rising interest rate environment could have the effect of increasing the magnitude of the purchase accounting marks relating to such fair value adjustments, thereby increasing initial tangible book value dilution, extending the tangible book value earn-back period, and negatively impacting the combined company’s capital ratios, which may result in the combined company taking steps to strengthen its capital position. Additionally, some of the performing loans in the Brunswick loan portfolio being acquired by Mid Penn may be under-collateralized or the estimated allowance for credit losses associated with the loan portfolio may need to be adjusted. There is no assurance that the allowance for credit losses that Mid Penn places on the Brunswick loan portfolio to mitigate against under-collateralized, non-performing loans will be adequate or that Mid Penn will not incur losses that could be greater than this estimate.
Risks Relating to Mid Penn’s Business
You should read and consider risk factors specific to Mid Penn’s business that will also affect the combined company after the merger. These risks are described in the sections entitled “Risk Factors” in Mid Penn’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021 and in other documents incorporated by reference into this document. Please see the section entitled “Where You Can Find More Information” beginning on page 106 of this document for the location of information incorporated by reference into this document.
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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
This joint proxy statement/prospectus contains or incorporates by reference a number of forward-looking statements, including statements about the financial conditions, results of operations, earnings outlook and prospects of Mid Penn, Brunswick and the potential combined company and may include statements for periods following the completion of the merger. Forward-looking statements are typically identified by words such as “plan,” “believe,” “expect,” “anticipate,” “intend,” “outlook,” “estimate,” “forecast,” “project” and other similar words and expressions.
The forward-looking statements involve certain risks and uncertainties. The ability of either Mid Penn or Brunswick to predict results or the actual effects of its plans and strategies, or those of the combined company, is subject to inherent uncertainty. Factors that may cause actual results or earnings to differ materially from such forward-looking statements include those beginning on page 24 under “Risk Factors,” as well as, among others, the following:
those discussed and identified in public filings with the SEC made by Mid Penn;
the effects of the ongoing COVID-19 pandemic on the economy generally and on Mid Penn and Brunswick in particular;
completion of the merger is dependent on, among other the things, the receipt of shareholder and regulatory approvals, the timing of which cannot be predicted with precision and which may not be received at all;
the merger may be more expensive to complete than anticipated, including as a result of unexpected factors or events;
higher than expected increases in Mid Penn’s or Brunswick’s loan losses or in the level of nonperforming loans;
higher than expected charges incurred by Mid Penn in connection with marking Brunswick’s assets to fair value;
a continued weakness or unexpected decline in the U.S. economy, in particular in Pennsylvania and New Jersey;
a continued or unexpected decline in real estate values within Mid Penn’s and Brunswick’s market areas;
unanticipated reduction in Mid Penn’s or Brunswick’s respective deposit bases or funding sources;
government intervention in the U.S. financial system and the effects of and changes in trade and monetary and fiscal policies and laws, including the interest rate risk policies of the FRB;
legislative and regulatory actions could subject Mid Penn to additional regulatory oversight which may result in increased compliance costs and/or require Mid Penn to change its business model;
the integration of Brunswick’s business and operations with those of Mid Penn may take longer than anticipated, may be more costly than anticipated and may have unanticipated adverse results relating to Brunswick’s or Mid Penn’s existing businesses; and
the anticipated cost savings and other synergies of the merger may take longer to be realized or may not be achieved in their entirety, and attrition in key client, partner and other relationships relating to the merger may be greater than expected.
Because forward-looking statements are subject to assumptions and uncertainties, actual results may differ materially from those expressed or implied by these forward-looking statements. You are cautioned not to place undue reliance on these statements, which speak only as of the date of this joint proxy statement/prospectus or the date of any document incorporated by reference in this joint proxy statement/prospectus.
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All subsequent written and oral forward-looking statements concerning the merger or other matters addressed in this joint proxy statement/prospectus and attributable to Mid Penn or Brunswick or any person acting on their behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this joint proxy statement/prospectus. Except to the extent required by applicable law or regulation, Mid Penn and Brunswick undertake no obligation to update these forward-looking statements to reflect events or circumstances after the date of this joint proxy statement/prospectus or to reflect the occurrence of unanticipated events.
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MARKET PRICES AND SHARE INFORMATION
Mid Penn
Mid Penn common stock is listed and trades on The NASDAQ Global Market under the symbol “MPB.” As of March 1, 2023, there were [l] shares of Mid Penn common stock outstanding. Mid Penn has approximately [l] shareholders of record as of March 1, 2023.
The following tables show, for the indicated periods, the high and low sales prices per share for Mid Penn common stock, as reported on NASDAQ. Cash dividends declared and paid per share on Mid Penn common stock are also shown for the periods indicated below.
Mid Penn Common Stock
HighLowDividends
2021
First Quarter$29.87 $20.74 $0.24 
Second Quarter$29.29 $24.09 $0.20 
Third Quarter$28.38 $25.60 $0.20 
Fourth Quarter$33.89 $27.25 $0.20 
2022
First Quarter$33.50 $26.02 $0.20 
Second Quarter$28.48 $25.01 $0.20 
Third Quarter$31.23 $25.65 $0.20 
Fourth Quarter$34.99 $28.45 $0.20 
2023
First Quarter (through [l]
$$$
Dividends from Mid Penn Bank are Mid Penn’s primary source of funds to pay dividends on its common stock. Any further dividends paid on Mid Penn’s common stock would be declared and paid at the discretion of its board of directors and would be dependent upon Mid Penn’s liquidity, financial condition, results of operations, capital requirements and such other factors as the board of directors may deem relevant.
Brunswick
Brunswick common stock is quoted on the OTC Pink Market under the symbol “BRBW.” As of March 3, 2023, there were [l] shares of Brunswick common stock outstanding. Brunswick has approximately [l] shareholders of record as of March 3, 2023..
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The following tables show, for the indicated periods, the high and low sales prices of Brunswick common stock, as reported on the OTC Pink Markets. Cash dividends declared and paid per share of Brunswick common stock are also shown for the periods indicated below.
Brunswick Common Stock
HighLowDividends
2021
First Quarter$11.50 $8.50 $0.25 
Second Quarter$12.49 $10.57 $
Third Quarter$12.99 $11.00 $
Fourth Quarter$14.10 $12.90 $
2022
First Quarter$14.53 $13.50 $0.12 
Second Quarter$15.50 $14.25 $
Third Quarter$15.90 $15.50 $
Fourth Quarter$17.75 $15.70 $
2023
First Quarter (through [l]
$$$
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THE MERGER
Background of the Merger
During the course of developing its strategic plan, Mid Penn’s board of directors and senior management team regularly consider various strategies for creating additional shareholder value, including growth through the expansion of its customer base in existing markets, as well as growth through acquisition of banks or business lines in existing or other markets. As part of this strategic planning process, Mid Penn routinely evaluates possible business combinations, and has completed four acquisitions in recent years—Phoenix Bancorp, Inc. in 2015, The Scottdale Bank & Trust Co. in January 2018, First Priority Financial Corp. in July 2018 and Riverview Financial Corporation in November 2021.
Brunswick’s Board and management have periodically reviewed and assessed strategic opportunities and challenges faced by Brunswick Bank as a smaller community bank with a limited trading market. The Board concluded that in order for Brunswick Bank to successfully compete as an independent institution while satisfying the increasing regulatory obligations applicable to it and to provide an acceptable return to its shareholders, Brunswick would need to grow significantly and ultimately establish a more liquid trading market for its common stock. Alternatively, the Brunswick Board concluded that if executing a strategic plan providing for significant growth entailed too much risk, Brunswick should consider finding a strategic partner.
As a result of these conclusions, in 2021, Brunswick engaged in substantial discussions with two insured depository institutions regarding two different possible strategic combinations. In the first instance, which contemplated an outright sale of Brunswick, the potential acquirer went through a robust diligence process before electing to discontinue further discussions. Similarly, in the latter instance, which contemplated a merger of equals, the merger partner elected to discontinue negotiations following diligence.
At the June 21, 2022 Brunswick Board meeting, the Brunswick Board again reviewed its strategic alternatives. Management noted that Brunswick and its advisors had been contacted by several parties expressing interest in a strategic transaction with Brunswick. The Board discussed the fact that Brunswick was coming off of a number of quarters of strong performance, and that there seemed to be market interest in Brunswick, and so if the Brunswick Board believed a sale would ultimately be in the best interests of Brunswick and its shareholders, this would be a good time to solicit interest in a strategic transaction with Brunswick. At the June 21, 2022 Brunswick Board meeting, the Brunswick Board authorized Brunswick to undertake a solicitation process to gauge market interest in Brunswick, and appointed the Board’s Strategic Planning Committee (“SPC”) to oversee the process and report back to the Board.
On June 22, 2022, the SPC met with counsel from Windels Marx Lane & Mittendorf, LLP and representatives from its financial advisor, Janney. The SPC discussed the then current state of the merger and acquisition market and the potential sale process with its legal and financial advisors, including potential timelines and parties that might have an interest in a strategic transaction with Brunswick. After reviewing the parties, the SPC authorized Janney to contact eighteen (18) parties that the financial advisor believed could have an interest in Brunswick. Such parties had assets ranging from a low of approximately Six Hundred Fifty Million Dollars ($650,000,000) to a high of over Ten Billion Dollars ($10,000,000,000).
On July 25, 2022, Brunswick executed an engagement letter with Janney, formally retaining Janney as its financial advisor.
Subsequent to the June 22, 2022 SPC meeting, four (4) additional financial institutions with assets ranging from a low of approximately One and a Half Billion Dollars ($1,500,000,000) to a high of approximately Four Billion Seven Hundred Million Dollars ($4,700,000,000) contacted Brunswick or Janney to express interest in a possible strategic transaction or were identified by Janney as parties that might also have an interest in Brunswick and presented by Janney to the SPC for approval. The SPC determined to include these four additional parties in the solicitation process.
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In June and July 2022, Brunswick worked with Janney to prepare a confidential information memorandum and initial disclosure materials, and representatives from Janney contacted the twenty-two (22) parties approved by the SPC.
Of the parties contacted, fifteen (15), including Mid Penn, signed non-disclosure agreements and received Brunswick’s confidential information memorandum and received access to a virtual data room. In order to facilitate an orderly sale process, the non-disclosure agreements included a customary standstill provision that provided that such provision would terminate if Brunswick entered into an agreement providing for the sale or change in control of Brunswick.
Ultimately, six (6) parties, including Mid Penn, submitted preliminary indications of valuation by the mid-August deadline established by Brunswick’s SPC.
The SPC met on August 24, 2022 with its legal and financial advisors to review the indication letters. The indications valued Brunswick in a range of $16.75 per share to a high valuation, net of adjustment for certain tax issues specific to that indication, of $19.57 per share. The indications provided for consideration to be paid all in cash or in a mix of stock and cash. Mid Penn’s indication valued Brunswick in a range of from $17.50 to $18.00 per share, and provided for a 50-50 mix of cash and Mid Penn stock. The SPC reviewed each of the indications and information about each of the interested parties. The SPC determined that the three parties with the highest indicated valuation, which did not include Mid Penn, would be invited to undertake more detailed diligence and then provide an updated indication letter. In addition, Mid Penn was also invited to undertake more detailed diligence and present an updated indication letter, provided that Mid Penn confirmed that their indicated valuation was $18.00 per share, which they did.
During September 2022, Brunswick worked with each of the four parties invited to undertake a detailed diligence review of Brunswick to provide diligence material and answer questions. Updated indications of interest were requested by early October.
On September 26, 2022, members of senior management of Mid Penn met with members of senior management of Brunswick, together with representatives of Stephens, Inc., Mid Penn’s financial advisor, and Janney, to discuss Mid Penn’s indication of interest and the pros and cons of a strategic combination of Mid Penn and Brunswick.
At the end of the diligence review period, and prior to the due date for updated indication letters, one of the interested parties, the party that had valued Brunswick at a net valuation of $19.57 per share, notified representatives of Janney that it was withdrawing from the process. The three other parties submitted updated indication letters by early October.
On October 11, 2022, the SPC met with Brunswick’s legal and financial advisors to review the three updated indication letters. The final indications stated a value for Brunswick in a range of $16.75 per share to $18.27 per share. All three indications provided for a mix of cash and acquirer stock as the transaction consideration. Mid Penn’s indication had a stated value of $18.00 per share, and provided for a 50-50 mix of cash and Mid Penn common stock. The SPC discussed each of the three indications, and determined that the Mid Penn indication was superior to the others for several reasons:
Based on Mid Penn’s then current stock price and a 50-50 split of cash and Mid Penn stock, the Mid Penn indication represented the highest value for Brunswick;
Mid Penn was a more experienced acquirer, successfully completing several other transactions, thus reducing execution risk;
One of the other bidders had yet to undertake a detailed review of Brunswick’s loan portfolio, and was unwilling to do so unless granted exclusivity by Brunswick, thus increasing the execution risk for that indication; and
The liquidity in the market for Mid Penn’s stock.
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The SPC therefore unanimously agreed to recommend to the Brunswick Board that Brunswick begin exclusive negotiations with Mid Penn on a definitive transaction agreement.
On October 14, 2022, the Brunswick Board held a special meeting to review and act upon the recommendation of the SPC. Brunswick’s legal and financial advisors participated in the meeting. The representative of Windels Marx Lane & Mittendorf, LLP, Brunswick’s legal advisor, discussed with the Board its fiduciary duties. The representatives of Janney discussed with the Board the process they had undertaken on behalf of Brunswick, the initial indications Brunswick had received, the parties invited to undertake a detailed diligence review and the terms of the three (3) final indications Brunswick had received. The representatives of Janney also reviewed information about each of the three (3) final interested parties.
The Chair of the SPC then discussed with the Brunswick Board the SPC’s recommendation that Brunswick move forward with exclusive negotiations with Mid Penn, and the reasons underlying that recommendation. After discussion, the Brunswick Board adopted the SPC’s recommendation and authorized Brunswick’s President and CEO to negotiate and execute an exclusivity agreement with Mid Penn.
Effective October 19, 2022, Brunswick and Mid Penn entered into an exclusivity agreement which provided for a forty-five (45) day exclusivity period, during which Brunswick and its representatives were prohibited from engaging in negotiations or entering into any agreement with any third parties relating to alternative business combination transactions.
At its regularly scheduled meeting on October 27, 2022, the Mid Penn board of directors was informed by senior management that Brunswick had accepted Mid Penn’s nonbinding indication of interest letter and entered into an exclusivity agreement, and that the parties had commenced their respective formal due diligence reviews. Representatives of Stephens participated in the meeting and presented the Mid Penn board with an executive summary of the proposed transaction and a review of various preliminary pro forma financial metrics and key assumptions considered in developing those metrics. Discussion was held concerning pricing and social terms, as well as opportunities and challenges associated with such a combination being an out-of-market transaction. Following such discussion, the Mid Penn board authorized management to proceed with completing its due diligence review of Brunswick and negotiating a definitive merger agreement for its review on the terms described in the nonbinding indication of interest letter.
During the second half of October 2022 through mid-December 2022, the parties and their respective legal and financial advisors engaged in a due diligence investigation of the other party, which included documentary review and management interviews.
On November 11, 2022, Pillar+Aught, counsel for Mid Penn, provided a draft of a definitive merger agreement to Windels Marx Lane & Mittendorf, LLP.
During November and early December 2022, the legal and financial advisors and executive officers for Brunswick and Mid Penn negotiated the final terms of the definitive merger agreement and other transaction documents. During this time, Pillar+Aught and Windels Marx Lane & Mittendorf, LLP also exchanged drafts of the form of voting agreements to be entered into by Mid Penn with each of the directors, executive officers and a certain ten percent (10%) shareholder of Brunswick. Pillar+Aught and Windels Marx Lane & Mittendorf, LLP also exchanged drafts of the form of voting agreements proposed to be entered into by Brunswick and each of the directors and executive officers of Mid Penn.
Effective December 2, 2022, Brunswick and Mid Penn agreed to extend the exclusivity period to December 31, 2022 in order to provide the parties sufficient time to complete their respective diligence investigation and negotiate the transaction documents.
On December 20, 2022, the Boards of both Brunswick and Mid Penn met to review and vote upon the proposed transaction and the various transaction documents.
Representatives of Janney and Windels Marx Lane & Mittendorf, LLP participated in the Brunswick Board meeting. The representatives of Windels Marx Lane & Mittendorf, LLP reviewed with the Brunswick Board the
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fiduciary duties owed to Brunswick’s stockholders and the terms of the proposed merger, the merger agreement and the other transaction documents. The representatives of Janney provided a financial analysis of the proposed transaction. The representatives of Janney also orally rendered Janney’s opinion, which was subsequently confirmed in writing (a copy of which is attached as Annex B to this joint proxy statement/prospectus), to the effect that, as of December 20, 2022 and subject to the procedures followed, assumptions made, matters considered and qualifications and limitations on the review undertaken by Janney as set forth in the opinion, the proposed Merger Consideration was fair, from a financial point of view, to the holders of Brunswick common stock.
Representatives of Stephens, Piper Sandler and Pillar+Aught participated in the Mid Penn board meeting, during which they reviewed the provisions of the merger agreement in detail with the board of directors. Representatives of Stephens and Piper Sandler discussed the financial terms of the proposed transaction and Pillar+Aught discussed with the Mid Penn board their fiduciary duties under Pennsylvania law. Following the review of its financial analyses of the merger, Piper Sandler delivered its oral opinion, which was subsequently confirmed in writing (a copy of which is attached as Appendix C to this joint proxy statement/prospectus), to the effect that, as of that date and subject to assumptions made, procedures followed, matters considered and limitations on the review undertaken set forth in the opinion, the Merger Consideration in the merger was fair, from a financial point of view, to Mid Penn. After careful consideration of these presentations, as well as the factors described under the section of this joint proxy statement/prospectus entitled “Mid Penn’s Reasons for the Merger,” and following further discussion, the Mid Penn board of directors unanimously approved the merger agreement and agreed to recommend that Mid Penn’s shareholders adopt and approve the merger agreement.
Brunswick and Mid Penn jointly announced the transaction on the evening of December 20, 2022, after the close of the trading markets.
Brunswick’s Reasons for the Merger
In determining that the merger and the merger agreement were fair to and advisable for Brunswick and its shareholders, in authorizing and approving the merger, in adopting the merger agreement and in recommending that Brunswick shareholders vote for approval of the merger agreement, the Brunswick Board consulted with members of Brunswick’s management and with Janney, and also considered a number of factors that the Brunswick Board viewed as relevant to its decisions. The following discussion of the information and factors considered by the Brunswick Board is not intended to be exhaustive; however, it does include all material factors considered by the Brunswick Board.
In reaching its decision to approve the merger agreement, the Brunswick Board considered the following:
the understanding of the Brunswick Board of the strategic options available to Brunswick and the Brunswick Board’s assessment of those options, including the economic environment for smaller community banks, and the determination that none of those options were more likely to create greater present value for Brunswick’s shareholders than the value to be paid by Mid Penn;
the challenges facing Brunswick’s management to grow Brunswick’s franchise and enhance shareholder value given current market conditions, including increased operating costs resulting from regulatory and compliance mandates, continued pressure on net interest margins from the current interest rate environment and competition, especially for deposits;
the strong capital base the resulting institution would have after the transaction;
the pro forma dividend the Mid Penn stock to be issued as part of the merger consideration;
the ability to become part of a larger institution with a higher lending limit and the infrastructure for growth in small and middle-market lending, helping to further service Brunswick’s customer base;
the geographic fit and increased customer convenience of the expanded branch network offered by the combined bank;
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that the common stock the Brunswick shareholders will receive will be listed on the Nasdaq Global Market, thereby providing enhanced liquidity to the Brunswick shareholders, as the Brunswick common stock is currently traded only on the OTC Pink Market;
the cash component in the offer by Mid Penn to the Brunswick shareholders, allowing those shareholders needing immediate liquidity to receive cash;
the terms of the merger agreement and the structure of the merger transaction, including that the merger is intended to qualify as a transaction that is generally tax-free for U.S. federal income tax purposes to shareholders of Brunswick that only receive shares of Mid Penn common stock in exchange for their shares of Brunswick common stock;
the compatibility of the business cultures of the two organizations;
the financial condition, results of operations, and prospects of the two entities;
the opinion of Janney, based upon various analyses described below, including a review of comparable transactions, that the consideration to be received by the Brunswick shareholders is fair to the shareholders of Brunswick from a financial point of view;
the Brunswick Board’s view, based on, among other things, the opinion of Janney, that the merger consideration is fair to the shareholders of Brunswick from a financial point of view;
that Brunswick’s shareholders would have the ability to elect to receive either shares of Mid Penn common stock or cash for some or all of their shares of Brunswick common stock.
the prospects for Brunswick’s employees within the combined company; and
the likelihood of obtaining the shareholder and regulatory approvals needed to complete the transaction.
All business combinations, including the merger, also include certain risks and disadvantages. The material potential risks and disadvantages to Brunswick’s shareholders identified by the Brunswick Board and management include the following material matters, the order of which does not necessarily reflect their relative significance:
the risks of attaining the type of revenue enhancements and cost savings necessary to cause the trading markets to consider the transaction a success;
that the Mid Penn stock may not perform well after the closing for reasons unrelated to the proposed transaction, including possible credit, funding or other issues related to Mid Penn’s business;
that the termination fee provided for in the merger agreement and certain other provisions of the merger agreement might discourage third parties from seeking to acquire Brunswick, in light of the fact that Mid Penn was unwilling to enter into the merger agreement absent such provisions;
the potential risk of diverting management attention and resources from the operation of Brunswick’s business and towards the completion of the merger;
the restrictions on the conduct of Brunswick’s business before the completion of the merger, which are customary for merger agreements involving financial institutions, but which, subject to specific exceptions, could delay or prevent Brunswick from undertaking business opportunities that may arise or any other action it would otherwise take with respect to the operations of Brunswick absent the pending merger; and
the risk of potential employee attrition and/or adverse effects on business and customer relationships as a result of the pending merger.
This discussion of the information and factors considered by the Brunswick Board in reaching its conclusions and recommendation includes the factors identified above, but is not intended to be exhaustive and may not include all of the factors considered by the Brunswick Board. In view of the wide variety of factors considered in connection
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with its evaluation of the merger and the other transactions contemplated by the merger agreement, and the complexity of these matters, the Brunswick Board did not find it useful and did not attempt to quantify, rank or assign any relative or specific weights to the various factors that it considered in reaching its determination to approve the merger and the other transactions contemplated by the merger agreement, and to make its recommendation to Brunswick shareholders. Rather, the Brunswick Board viewed its decisions as being based on the totality of the information presented to it and the factors it considered, including its discussions with and questioning of members of Brunswick’s management and outside legal and financial advisors. In addition, individual members of the Brunswick Board may have assigned different weights to different factors.
Certain of Brunswick’s directors and executive officers have financial interests in the merger that are different from, or in addition to, those of Brunswick’s shareholders generally. The Brunswick Board was aware of and considered these potential interests, among other matters, in evaluating the merger and in making its recommendation to Brunswick shareholders. For a discussion of these interests, see “—Interests of Brunswick’s Directors and Executive Officers in the Merger.
Recommendation of Brunswick’s Board of Directors
Brunswick’s board of directors believes that the terms of the transaction are in the best interests of Brunswick and its shareholders and has unanimously approved the merger agreement. Accordingly, Brunswick’s board of directors unanimously recommends that Brunswick’s shareholders vote “FOR” the Brunswick merger proposal and “FOR” the approval of the Brunswick adjournment proposal.
Opinion of Brunswick’s Financial Advisor
Janney was engaged by the Board of Directors of Brunswick to act as financial advisor and to render a fairness opinion for the Board of Directors of Brunswick in connection with a potential business combination (the “Merger”) with Mid Penn. Janney delivered to the Board of Directors of Brunswick its opinion dated December 20, 2022 that, based upon and subject to the various considerations set forth in its written opinion, the merger consideration to be received by the shareholders of Brunswick from Mid Penn is fair to the shareholders of Brunswick from a financial point of view. In requesting Janney’s advice and opinion, no limitations were imposed by Brunswick with respect to the investigations made or procedures followed by it in rendering this opinion. The full text of the opinion of Janney, which describes the procedures followed, assumptions made, matters considered and limitations on the review undertaken, are attached hereto as Annex B. Shareholders of Brunswick should read this opinion in its entirety. Janney’s opinion speaks only as of December 20, 2022.
Janney is a nationally recognized investment banking firm and, as part of its investment banking business, it values financial institutions in connection with mergers and acquisitions, private placements and for other purposes. As a specialist in securities of financial institutions, Janney has experience in, and knowledge of, banks, thrifts and bank and thrift holding companies. Brunswick’s Board of Directors selected Janney to render a fairness opinion in connection with the Merger on the basis of the firm’s reputation and expertise in transactions such as the Merger.
Janney has received a fee from Brunswick for rendering a written opinion to the Board of Directors of Brunswick as to the fairness, from a financial point of view, of the merger consideration to shareholders of Brunswick. Further, Brunswick has agreed to indemnify Janney against any claims or liabilities arising out of Janney’s engagement by Brunswick. The opinion has been reviewed by Janney’s compliance officer and fairness committee consistent and with internal policy. Janney has not provided financial services and has not received compensation from Brunswick during the prior two years. Certain employees of Janney were employed by another investment bank that received compensation from Brunswick for financial advisory services within the past two years.
The following is a summary of the analyses performed by Janney in connection with its fairness opinion. Certain analyses were confirmed in a presentation to the Board of Directors of Brunswick by Janney. The summary set forth below does not purport to be a complete description of either the analyses performed by Janney in rendering its opinion or the presentation delivered by Janney to the Board of Directors of Brunswick, but it does summarize all of the material analyses performed and presented by Janney.
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The preparation of a fairness opinion involves various determinations as to the most appropriate and relevant methods of financial analyses and the application of those methods to the particular circumstances. In arriving at its opinion, Janney did not attribute any particular weight to any analysis or factor considered by it, but rather made qualitative judgments as to the significance and relevance of each analysis and factor. Janney may have given various analyses more or less weight than other analyses. Accordingly, Janney believes that its analyses and the following summary must be considered as a whole and that selecting portions of its analyses, without considering all factors, could create an incomplete view of the process underlying the analyses set forth in its report to the Board of Directors of Brunswick and its fairness opinion.
In performing its analyses, Janney made numerous assumptions with respect to industry performance, general business and economic conditions and other matters, many of which are beyond the control of Brunswick or Mid Penn. The analyses performed by Janney are not necessarily indicative of actual value or actual future results, which may be significantly more or less favorable than suggested by such analyses. Such analyses were prepared solely as part of Janney’s analysis of the fairness of the merger consideration, from a financial point of view, to Brunswick shareholders. The analyses do not purport to be an appraisal or to reflect the prices at which a company might actually be sold or the prices at which any securities may trade at the present time or at any time in the future. Janney’s opinion does not address the relative merits of the merger as compared to any other business combination in which Brunswick might engage. In addition, as described above, Janney’s opinion was one of many factors taken into consideration by the Board of Directors of Brunswick in making its determination to approve the merger agreement.
During the course of its engagement and as a basis for arriving at its opinion, Janney reviewed and analyzed material bearing upon financial and operating conditions of Brunswick and Mid Penn and material prepared in connection with the merger, including, among other things, the following:
(i)A draft of the merger agreement, dated December 19, 2022;
(ii)Certain publicly available financial statements and other historical financial information of Mid Penn, both audited and unaudited, that Janney deemed relevant, including reports filed by Mid Penn with the Securities and Exchange Commission, the Federal Deposit Insurance Corporation and the Federal Reserve Board;
(iii)Certain publicly available financial statements and other historical financial information of Brunswick and its banking subsidiary, Brunswick Bank, both audited and unaudited, that Janney deemed relevant, including reports filed by Brunswick with the Federal Deposit Insurance Corporation and the Federal Reserve Board;
(iv)Certain internal financial projections for Brunswick for the years ending December 31, 2022 through December 31, 2024, as provided by the senior management of Brunswick, as well as an estimated long-term net income growth rate for the years ending December 31, 2025 through December 31, 2028
(v)Research analyst estimates for Mid Penn for the years ending December 31, 2022 through December 31, 2024, as well as an estimated long-term annual net income growth rate for the years ending December 31, 2025 through December 31, 2028;
(vi)The pro forma financial impact of the merger on Mid Penn based on certain assumptions related to transaction expenses, cost savings, and purchase accounting adjustments, as provided by senior management and representatives of Mid Penn;
(vii)The publicly reported price, valuation and historical trading activity for Brunswick common stock and Mid Penn common stock and certain stock indices, as well as similar publicly available information for certain other publicly traded companies;
(viii)A comparison of certain market and financial information for Brunswick and Mid Penn with similar financial institutions for which information is publicly available;
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(ix)The financial terms of certain recent business combinations in the bank and thrift industry on a nationwide and a regional basis, to the extent publicly available; and
(x)Such other information, financial studies, analyses and investigations and financial, economic and market criteria as Janney considered relevant.
Janney also took into account our assessment of general economic, market and financial conditions and our experience in other transactions, as well as our knowledge of the banking industry and our general experience in securities valuation.
In arriving at our opinion, Janney has assumed, without independent verification, the accuracy and completeness of the financial and other information and representations contained in the materials provided to us by Brunswick and Mid Penn and in the discussions with Brunswick’s and Mid Penn respective management teams. Janney has not independently verified the accuracy or completeness of any such information. Janney has further relied upon the assurances of the management of Brunswick and Mid Penn that the financial information provided has been prepared on a reasonable basis in accordance with industry practice, and that they are not aware of any information or facts that would make any information provided to us incomplete or misleading. Without limiting the generality of the foregoing, for the purpose of our analyses and this opinion, Janney has assumed that, with respect to financial forecasts, estimates and other forward-looking information reviewed by us, that such information has been reasonably prepared based on assumptions reflecting the best currently available estimates and judgments of the management of Brunswick and Mid Penn (as the case may be) as to the expected future results of operations and financial condition of Brunswick and Mid Penn and the other matters covered thereby.
Janney has also assumed that the financial estimates and estimates and allowances regarding under-performing and nonperforming assets and net charge-offs have been reasonably prepared on a basis reflecting the best currently available information, judgments and estimates of Brunswick and Mid Penn and that such estimates will be realized in the amounts and at the times contemplated thereby. Janney is not an expert in the evaluation of loan and lease portfolios for purposes of assessing the adequacy of the allowances for losses with respect thereto and have assumed and relied upon management’s estimates and projections. Janney was not retained to and did not conduct a physical inspection of any of the properties or facilities of Brunswick or Mid Penn or their respective subsidiaries. In addition, Janney has not reviewed individual credit files nor has Janney made an independent evaluation or appraisal of the assets and liabilities of Brunswick or Mid Penn nor any of their respective subsidiaries, and Janney was not furnished with any such evaluations or appraisals.
Summary of Proposed Merger Consideration and Implied Transaction Metrics. Janney reviewed the financial terms of the proposed transaction using an exchange ratio of 0.598 shares of Mid Penn common stock for each share of Brunswick common stock, Mid Penn’s closing price as of December 19, 2022, of $30.95, and the closing price of Brunswick common stock on December 19, 2022, of $16.45. Janney calculated an aggregate implied transaction value of approximately $53.9 million, or a transaction price per share of $18.25. Based upon financial information for Brunswick as or for the last twelve months (“LTM”) ended September 30, 2022, unless otherwise noted, Janney calculated the following implied transaction metrics:
Transaction Price / LTM Earnings:
13.1 x
Transaction Price / 2023E(1):
12.3 x
Transaction Price / Tangible Book Value
120.3 %
Tangible Book Premium/Core Deposits(2):
5.4 %
Pro Forma Ownership
5.1 %
__________________
(1)Based upon internal financial projections for Brunswick, as provided by the senior management of Brunswick
(2)Core deposits calculated as Total Deposits less Time Deposits
Comparable Company Analyses. Janney used publicly available information to compare selected financial information for Brunswick with a group of financial institutions selected by Janney for the Brunswick Peer
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Valuation Comparison. The Brunswick Peer Group consisted of publicly-traded holding companies, deemed comparable to Brunswick. The Brunswick Peer Group consisted of the following companies:
New Tripoli Bancorp, Inc.
The Victory Bancorp, Inc.
Mauch Chunk Trust Financial Corp.
Woodsboro Bank
ES Bancshares, Inc.
Enterprise Financial Services Group, Inc.
Susquehanna Community Financial, Inc.
Glen Burnie Bancorp
Mifflinburg Bancorp, Inc.
Commercial National Financial Corporation
Peoples Ltd.
Elmer Bancorp, Inc.
Mars Bancorp, Inc.
Delhi Bank Corp.
First Resource Bancorp Inc.
Generations Bancorp NY, Inc.
Hamlin Bank and Trust Company
Fleetwood Bank Corporation
Neffs Bancorp, Inc.
Peoples Bancorp, Inc.
The analysis compared selected financial information for Brunswick with the corresponding publicly available data for the Brunswick Peer Group as of Year to Date September 30, 2022 (unless otherwise noted), with pricing data as of December 19, 2022. The table below sets forth the data for Brunswick and median and mean data for the Brunswick Peer Group.
Brunswick Peer Valuation Comparison
Brunswick
Brunswick
Peer Group Median
Brunswick
Peer Group Mean
Market Capitalization ($M)
$46.7 $29.5 $39.8 
Price / Tangible Book Value
108.4 %110.4 %124.1 %
Price / LTM EPS
11.8 x8.8 x9.5 x
Dividend Yield
— %2.4 %2.8 %
Weekly Volume
— %0.1 %0.1 %
Last Twelve Months Return
24.9 %(2.3)%(6.7)%
Total Assets ($M)
$381.6 $451.8 $464.6 
Tangible Common Equity/Tangible Assets
11.3 %7.1 %6.9 %
LTM Core ROAA
1.08 %0.81 %0.80 %
LTM Core ROATCE
9.23 %10.05 %10.26 %
LTM Efficiency Ratio
61.3 %70.4 %71.3 %
Loans / Deposits
108.1 %65.6 %70.8 %
NPAs / Assets
0.49 %0.26 %0.50 %
LTM NCOs / Loans
— %— %0.02 %
Note: Financial data for the institutions in the Brunswick Peer Group is not pro forma for any publicly announced and pending transactions.
Comparable Company Analyses. Janney used publicly available information to compare selected financial information for Mid Penn with a group of financial institutions selected by Janney for the Mid Penn Peer Valuation
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Comparison. The Mid Penn Peer Group consisted of publicly-traded holding companies, deemed comparable to Mid Penn. The Mid Penn Peer Group consisted of the following companies:
Univest Financial Corporation
Peoples Financial Services Corp.
Metropolitan Bank Holding Corp.
Shore Bancshares, Inc.
Peapack-Gladstone Financial Corporation
BCB Bancorp, Inc.
TrustCo Bank Corp NY
Orrstown Financial Services, Inc.
Northfield Bancorp, Inc.
ACNB Corporation
Financial Institutions, Inc.
First Bank
CNB Financial Corporation
Chemung Financial Corporation
Canandaigua National Corporation
The First of Long Island Corporation
Arrow Financial Corporation
The analysis compared selected financial information for Mid Penn with the corresponding publicly available data for the Mid Penn Peer Group as of Year to Date September 30, 2022 (unless otherwise noted), with pricing data as of December 19, 2022. The table below sets forth the data for Mid Penn and median and mean data for the Mid Penn Peer Group.
Mid Penn Peer Valuation Comparison
Mid Penn
Mid Penn
Peer Group Median
Mid Penn
Peer Group Mean
Market Capitalization ($M)
$491.6 $408.8 $465.6 
Price / Tangible Book Value
130.3 %121.2 %135.2 %
Price / LTM EPS
12.4 x10.2 x10.0 x
Price / 2022E EPS
8.9 x8.4x8.6x
Dividend Yield
2.6 %3.1 %2.9 %
Weekly Volume
0.9 %1.4 %1.4 %
Last Twelve Months Return
(1.2)%1.0 %1.5 %
Total Assets ($M)
$4,333.9 $4,291.2 $4,487.2 
Tangible Common Equity/Tangible Assets
8.9 %7.9 %7.9 %
LTM Core ROAA
1.21 %1.14 %1.17 %
LTM Core ROATCE
14.46 %13.96 %14.40 %
LTM Efficiency Ratio
57.5 %56.0 %55.9 %
Loans / Deposits
89.1 %87.0 %87.4 %
NPAs / Assets
0.18 %0.24 %0.28 %
LTM NCOs / Loans
— %0.05 %0.05 %
Note: Financial data for the institutions in the Mid Penn Peer Group is not pro forma for any publicly announced and pending transactions.
Net Present Standalone Value Analyses. Janney performed an analysis that estimated the net present value per share of Mid Penn’s common stock assuming Mid Penn performed in accordance with estimates based on publicly available mean analyst earnings per share estimates. To approximate the terminal value of a share of Mid Penn’s common stock at December 31, 2027, Janney applied a long term growth rate range of 7.5%. The terminal values were then discounted to present values using discount rates ranging from 12.0% to 16.0%. The discount rates selected by Janney were intended to reflect different assumptions regarding the required rates of return for holders or prospective buyers of Mid Penn’s common stock. The analysis and the underlying assumptions yielded a range of
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values per share of Mid Penn’s common stock of $27.14 to $39.75 when applying a terminal value based on tangible book value and $25.06 to $41.15 when applying a terminal value based on earnings.
Price per Share Sensitivity (Tangible Book Value Multiple):
Discount Rate
1.1x1.2x1.3x1.4x1.5x
12.0%
$31.00 $33.19 $35.37 $37.56 $39.75 
13.0%
$29.97 $32.07 $34.18 $36.29 $38.40 
14.0%
$28.98 $31.01 $33.04 $35.07 $37.10 
15.0%
$28.04 $29.99 $31.95 $33.91 $35.86 
16.0%
$27.14 $29.02 $30.91 $32.79 $34.68 
Price per Share Sensitivity (Earnings Multiple):
Discount Rate
6.9x7.9x8.9x9.9x10.9x
12.0%
$28.59 $31.73 $34.87 $38.01 $41.15 
13.0%
$27.65 $30.67 $33.70 $36.72 $39.74 
14.0%
$26.75 $29.66 $32.57 $35.49 $38.40 
15.0%
$25.89 $28.69 $31.50 $34.31 $37.11 
16.0%
$25.06 $27.77 $30.47 $33.18 $35.88 
Analysis of Selected Merger Transactions. Janney reviewed groups of selected merger and acquisition transactions that were deemed to be comparable to the merger. These two groups were labeled as the “National” Group and “Regional” Group. The National Group consisted of seventeen selected bank and thrift merger transactions with disclosed transaction value, where target total assets were between $350 million and $600 million
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and transaction value between $40 million and $80 million, announced since June 30, 2021. The National Group was composed of the following transactions:
BuyerTargetPrice / TBV (%)Price / LTM EPS (x)Core Deposit Premium (%)
Spencer Savings Bank SLA
Mariner’s Bank123.714.33.1
First Western Financial Inc.
Teton Financial Services Inc.127.017.63.0
Finward Bancorp
Royal Financial Inc.115.510.12.3
Seacoast Banking Corp. of FL
Sabal Palm Bancorp Inc.184.19.07.0
SouthPoint Bancshares Inc.
Merchants Financial Svcs Inc149.713.04.9
Eagle Bancorp Montana Inc.
First Community Bancorp Inc.140.07.24.1
Bus. First Bancshares Inc.
Texas Citizens Bancorp Inc.157.116.64.8
MidWestOne Financial Grp Inc.
Iowa First Bancshares Corp.NA17.7NA
BancFirst Corp.
Worthington National Bank199.218.910.3
InBankshares Corp
Legacy Bank132.68.83.9
Home Bancorp Inc.
Friendswood Capital Corp.147.3NM7.8
Cambridge Bancorp
Northmark Bank117.517.93.2
Middlefield Banc Corp.
Liberty Bancshares119.413.5NA
CrossFirst Bankshares Inc,
Farmers & Stockmens Bank165.4NM6.0
Somerset Savings Bank SLA
Regal Bancorp Inc.128.120.23.4
Citizens Financial Services
HV Bancorp Inc.163.621.85.6
Summit Financial Group Inc.
PSB Holding Corp.136.012.12.9

Average
144.114.64.8

Median
138.014.34.1
__________________
Note: P/E > 25x deemed non-meaningful for comparison purposes
Note: Excludes transactions without disclosed deal values, and excludes transactions categorized as mergers of equals
Source: S&P Capital IQ Pro; Data as of December 19, 2022
Janney calculated the median values for the following relevant transaction pricing multiples for the National Group: the multiple of the offer value to Brunswick’s tangible book value; the multiple of the offer value to Brunswick’s net income for the twelve months ended September 30, 2022; and the premium over tangible book value divided by core deposits. Janney used these median multiples to estimate the value of Brunswick’s common stock by applying each median multiple to Brunswick’s tangible common equity, net income for the twelve months ended September 30, 2022, and core deposits as of September 30, 2022, respectively. The results of this analysis are as follows:
Dollars in thousands, except per share amountsComparable Transactions
Valuation Multiple
Brunswick
Value
($000s)
Factor
Weight
(%)
Median
Multiple
Aggregate
Value ($000s)
Value Per Share
Tangible Common Equity$43,103 33 %138.0%$59,486 $20.94 
LTM Earnings$4,036 33 %14.3x$57,771 $20.33 
Core Deposits (1)
$199,745 33 %4.1%$51,273 $18.05 
Ranges of Values:Minimum$29,180 $10.27 
Maximum$87,823 $30.91 
Factor-Weighted Average$56,177 $19.77 
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__________________
(1)Core deposits defined as total deposits less jumbo time deposits.
Note: Per share metrics based upon 2,840,974 BRBW shares outstanding.
Source: S&P Capital IQ Pro
The National Group analysis suggested a range of value of $10.27 to $30.91 per share of Brunswick’s common stock, with a factor-weighted average of $19.77.
The Regional Group consisted of fifteen selected bank and thrift merger transactions with disclosed transaction terms, with targets headquartered in the Mid-Atlantic, with target total assets between $350.0 million and $1.5 billion, announced since January 1, 2021. The Regional Group was composed of the following transactions:
BuyerTargetPrice / TBV (%)Price / LTM EPS (x)Core Deposit Premium (%)
Fidelity D&D Bancorp Inc.
Landmark Bancorp Inc.121.6 NM3.0 
Shore Bancshares Inc.
Severn Bancorp Inc.134.7 21.7 NA
HPS Investment Partners LLC
Marlin Bus. Services Corp.152.6 14.9 NA
Valley National Bancorp
Westchester Bank Holding Corp.169.0 18.1 8.7 
Mid Penn Bancorp Inc.
Riverview Financial Corp.121.5 12.2 2.3 
Spencer Savings Bank SLA
Mariner’s Bank123.7 14.3 3.1 
Community Bank System Inc.
Elmira Savings Bank162.4 15.0 7.0 
Fulton Financial Corp.
Prudential Bancorp Inc.108.7 17.9 1.7 
Farmers National Banc Corp.
Emclaire Financial Corp147.5 10.4 4.1 
Nmb Financial Corp
Noah Bank
101.3 10.1 0.3 
Somerset Savings Bank SLARegal Bancorp Inc.128.1 20.2 3.4 
First Commonwealth Financial
Centric Financial Corp137.1 14.8 4.7 
Citizens Financial Services
HV Bancorp Inc.163.6 21.8 5.6 
Summit Financial Group Inc.
PSB Holding Corp136.0 12.1 2.9 
First Bank
Malvern Bancorp Inc102.4 21.4 NA

Average
134.0 16.0 3.9 

Median
134.7 14.9 3.2 
__________________
Note: P/E > 25x deemed non-meaningful for comparison purposes
Note: Excludes transactions without disclosed deal values, and excludes transactions categorized as mergers of equals
Source: S&P Capital IQ Pro; Data as of December 19, 2022
Janney calculated the median values for the following relevant transaction pricing multiples for the Regional Group: the multiple of the offer value to Brunswick’s tangible book value; the multiple of the offer value to Brunswick’s net income for the last twelve months; and the premium over tangible book value divided by core deposits. Janney used these median multiples to estimate the value of Brunswick’s common stock by applying each
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median multiple to Brunswick’s tangible common equity, net income for the twelve months ended September 30, 2022, and core deposits as of September 30, 2022, respectively. The results of this analysis are as follows:
Dollars in thousands, except per share amountsComparable Transactions
Valuation Multiple
Brunswick
Value
($000s)
Factor
Weight
(%)
Median
Multiple
Aggregate
Value ($000s)
Value Per Share
Tangible Common Equity$43,103 33 %134.7 %$58,073 $20.44 
LTM Earnings$4,036 33 %14.9 %$60,278 $21.22 
Core Deposits (1)
$199,745 33 %3.2 %$49,525 $17.43 
Ranges of Values:Minimum$40,652 $14.28 
Maximum$87,823 $30.91 
Factor-Weighted Average$55,958 $19.70 
__________________
(1)Core deposits defined as total deposits less jumbo time deposits.
Note: Per share metrics based upon 2,840,974 BRBW shares outstanding.
Source: S&P Capital IQ Pro
The Regional Group analysis suggested a range of value of $14.28 to $30.91 per share of Brunswick’s common stock, with a factor-weighted average of $19.70. 
Net Present Value Analyses. Janney performed an analysis that estimated the net present value per share of Brunswick’s common stock assuming Brunswick performed in accordance with estimates based upon discussions with Brunswick. To approximate the terminal value of a share of Brunswick’s common stock at December 31, 2027, Janney applied price to earnings multiples ranging from 9.8x to 13.8x and multiples of tangible book value ranging from 88.0% to 128.0%. The terminal values were then discounted to present values using discount rates ranging from 12.0% to 16.0%. The discount rates selected by Janney were intended to reflect different assumptions regarding the required rates of return for holders or prospective buyers of Brunswick’s common stock. The analysis and the underlying assumptions yielded a range of values per share of Brunswick’s common stock of $10.21 to $20.70 when applying a terminal value based on tangible book value and $12.67 to $23.86 when applying a terminal value based on earnings.
Price / Tangible Book Value Multiples
Discount
Rate
0.88x0.98x1.08x1.18x1.28x
12.0%
$12.30 $14.40 $16.50 $18.60 $20.70 
13.0%
$11.74 $13.76 $15.79 $17.81 $19.83 
14.0%
$11.21 $13.16 $15.10 $17.05 $19.00 
15.0%
$10.70 $12.58 $14.45 $16.33 $18.21 
16.0%
$10.21 $12.02 $13.83 $15.64 $17.45 
Price / Earnings Multiples
Discount
Rate
9.8x10.8x11.8x12.8x13.8x
12.0%
$15.15 $17.33 $19.50 $21.68 $23.86 
13.0%
$14.48 $16.58 $18.68 $20.77 $22.87 
14.0%
$13.85 $15.87 $17.89 $19.91 $21.93 
15.0%
$13.24 $15.19 $17.14 $19.08 $21.03 
16.0%
$12.67 $14.54 $16.42 $18.29 $20.17 
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In connection with its analyses, Janney considered and discussed with Brunswick’s Board of Directors how the present value analyses would be affected by changes in the underlying assumptions. Janney noted that the net present value analysis is a widely used valuation methodology, but the results of such methodology are highly dependent upon the numerous assumptions that must be made, and the results thereof are not necessarily indicative of actual values or future results.
Franchise Valuation. Janney used a franchise valuation analysis to estimate the value of Brunswick’s common stock based on the composition of its balance sheet on September 30, 2022. The franchise valuation analysis involves calculating the net asset value of Brunswick and adding a core deposit premium to the net asset value to determine the overall value of Brunswick. In order to calculate Brunswick’s net asset value, Janney adjusted Brunswick’s tangible common equity with an after-tax credit mark of approximately $2,228 thousand. The deposit premium was calculated by assigning a premium to each deposit account type based on the perceived value of each type of deposit to a potential acquiror.