UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON,Washington, D.C. 20549

SCHEDULE 14A

(Rule 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of

of the Securities Exchange Act of 1934

(Amendment No.      )

Filed by the Registrantx                            Filed by a Party other than the Registrant¨

Check the Appropriate Box:appropriate box:

MID PENN BANCORP, INC.

(Name of Registrant as Specified in Itsits Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

349 Union Street, Millersburg, PA 17061

March 27, 200926, 2010

Dear Shareholders:

It is my pleasure to invite youYou are cordially invited to attend the 20092010 Annual Meeting of Shareholders of Mid Penn Bancorp, Inc. to be held on Tuesday, April 28, 2009,May 4, 2010, at 10:00 a.m., prevailing time. The annual meeting will be held at Mid Penn Bank, 349 Union Street, Millersburg, Pennsylvania 17061.

The Notice of the Annual Meeting and the enclosed proxy statement address the formal business of the meeting. The formal business agenda includes the election of threefour Class BC Directors. At the meeting, management will review the corporation’sCorporation’s operations during the past year and will be available to respond to questions.

You are encouraged to vote your shares, whether or not you plan to attend the meeting. It is very important that you mark, sign, date and return the accompanying proxy as soon as possible in the postage-paid envelope. If you do attend the meeting and wish to vote in person, you must give written notice to the corporation’sCorporation’s Secretary, so your proxy will be superseded by any ballot that you submit at the meeting.

Sincerely,

Edwin D. Schlegel

Chairman of the Board

349 Union Street, Millersburg, PA 17061

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

TO BE HELD APRIL 28, 2009MAY 4, 2010

TO THE SHAREHOLDERS OF MID PENN BANCORP, INC.:

Notice is hereby given that the Annual Meeting of Shareholders of Mid Penn Bancorp, Inc. will be held at 10:00 a.m., prevailing time, on Tuesday, April 28, 2009,May 4, 2010, at Mid Penn Bank, 349 Union Street, Millersburg, Pennsylvania 17061, for the following purposes:

“Resolved, that the shareholders hereby approve the executive compensation, as described in the Compensation Discussion and Analysis and the tabular disclosure (together with the accompanying narrative disclosure), regarding named executive officers in this proxy statement.”

In accordance with the corporation’sCorporation’s By-laws and action of the Board of Directors, only those shareholders of record at the close of business on February 17, 2009,16, 2010, are entitled to notice of and to vote at the annual meeting and any adjournment or postponement thereof. For directions to the annual meeting, please contact Cindy L. Wetzel, Secretary, at (717) 692-2133.

We have enclosed a copy of the corporation’sCorporation’s Annual Report to Shareholderson Form 10-K (“annual report”) for the fiscal year ended December 31, 2008.2009. You may obtain aan additional copy of the corporation’sCorporation’s annual report on Form 10-K including the financial statements and any exhibits for the 2008 fiscal2009 year, at no cost, by contacting Kevin W. Laudenslager, Vice President and Treasurer, 349 Union Street, Millersburg, Pennsylvania 17061, telephone: (717) 692-2133.692-2133 or by visiting http://www.cfpproxy.com/5890.

We urgeWhether or not you plan to attend the annual meeting, your vote is very important, and we encourage you to mark, sign, date and promptly return your proxy in the enclosed envelope so that you may vote your shares and in order that we may assure the presence of a quorum. The prompt return of your signed proxy, regardless of the number of shares you hold, will aid the corporation in reducing the expense of additional proxy solicitation. Giving your proxy does not affect your right to vote in person if you attend the meeting and give written notice to the Secretary of the corporation.

Millersburg, Pennsylvania

March 27, 2009

Your vote is important.

promptly. To vote your shares, please mark, sign and date the enclosed proxy and mail it promptly in the

enclosed, postage-paid return envelope. If you execute a proxy but later decide to attend the annual meeting in person, or for any other reason desire to revoke your proxy, you may do so as described in this proxy statement at any time before your proxy is voted. Submitting a proxy will not prevent you from attending the annual meeting and voting in person if you so desire, but will help us secure a quorum and reduce the expense of additional proxy solicitation.

Millersburg, Pennsylvania

March 26, 2010

Important Notice Regarding the Availability of Proxy Materials for the Shareholder

Meeting to Be Held on May 4, 2010. The proxy statement, proxy card and 2009 annual

report to shareholders are available at http://www.cfpproxy.com/5890.

349 Union Street, Millersburg, PA 17061

NASDAQ Global Market Trading Symbol: MPB

PROXY STATEMENT

20092010 ANNUAL MEETING OF SHAREHOLDERS

APRIL 28, 2009MAY 4, 2010

Mailed to Shareholders on or about March 27, 200926, 2010

Table of ContentsTABLE OF CONTENTS

i

ii

FREQUENTLY ASKED QUESTIONS AND ANSWERS

PROXY STATEMENT

FOR THE ANNUAL MEETING OF SHAREHOLDERS OF

MID PENN BANCORP, INC.

APRIL 28, 2009MAY 4, 2010

GENERAL INFORMATION

Date, Time and Place of Annual Meeting

Mid Penn Bancorp, Inc. (“the Corporation”), a Pennsylvania business corporation and registered bank holding company, furnishes this proxy statement in connection with the solicitation by the Corporation’s Board of Directors’ solicitationDirectors (“the Board”) of proxies to be voted at the 20092010 Annual Meeting of Shareholders. The annual meeting will be held at Mid Penn Bank, 349 Union Street, Millersburg, Pennsylvania 17061, on Tuesday, April 28, 2009,May 4, 2010, at 10:00 a.m., prevailing time.Eastern Standard Time. The corporation’sCorporation’s principal executive office is located at 349 Union Street, Millersburg, Pennsylvania 17061; the telephone number is (717) 692-2133. All inquiries regarding the annual meeting should be directed to Kevin W. Laudenslager, Vice President and Treasurer of Mid Penn Bancorp, Inc.

Description of Mid Penn Bancorp, Inc.

Mid Penn Bancorp, Inc. is a bank holding company under Pennsylvania law and the Bank Holding Company Act of 1956. Mid Penn Bank is the corporation’s wholly-owned subsidiary and is a Pennsylvania chartered commercial bank.

A copy of the corporation’s Annual Report to Shareholders for the fiscal year ended December 31, 2008, is mailed with this proxy statement. You may also obtain a copy of the corporation’s annual report on Form 10-K including the financial statements and exhibits for the 2008 fiscal year at no cost by contacting Kevin W. Laudenslager, Vice President and Treasurer, 349 Union Street, Millersburg, Pennsylvania 17061, telephone: (717) 692-2133.

No person has been authorized to provide you with information about the corporation. You should rely only on the information contained in this document or on information to which this document refers. Although it is believed that you have been provided with all the information helpful to you in your decision to vote, events may occur at Mid Penn Bancorp, Inc. subsequent to the printing of this proxy statement that might affect your decision or the value of your stock.Corporation.

Internet Availability of Proxy Materials

Important Notice Regarding the Availability of Proxy Materials for the Shareholder Meeting to Be Held on April 28, 2009. The proxy statement, proxy card and 2008 annual report are available at http://www.cfpproxy.com/5890.

Additional Information

In accordance with Securities Exchange Act Rule 14a-3(3)(1), Mid Penn Bancorp, Inc.,the Corporation, in the future intends to deliver only one annual report and proxy statement to multiple shareholders sharing an address unless we receivethe Corporation receives contrary instructions from one or more of the shareholders.

This method of delivery is known as “householding”.“householding.” Upon written or oral request, Mid Penn Bancorp, Inc.the Corporation will promptly deliver a separate copy of the annual report or proxy statement, as applicable, to a shareholder at a shared address to which a single copy of the documents was delivered. Further, shareholders can notify Cindy L. Wetzel at Mid Penn Bancorp, Inc., 349 Union Street, Millersburg, Pennsylvania 17061 or by calling (717) 692-2133 and informing us that the shareholder wishes to receive a separate copy of an annual report or proxy statement in the future. In addition, ifIf you are receiving multiple copies of Mid Penn Bancorp, Inc.’s annual reportstatements and reports and wish to receive only one, please notify your broker if your shares are held in a brokerage account or proxy statement,the Corporation’s transfer agent if you may request that we deliver only a single copy of annual reports or proxy statements by notifying ushold registered shares. You can contact the Corporation’s transfer agent, Registrar and Transfer Company, at the above address or telephone number.(800) 368-5948.

VOTING PROCEDURES

Solicitation and Voting of Proxies

The Board of Directors solicits this proxy for use at the corporation’s 2009 annual meetingCorporation’s 2010 Annual Meeting of shareholders.Shareholders. The corporation’sCorporation’s directors, officers and bankBank employees may solicit proxies in person or by telephone, facsimile, email or other similar means without additional compensation. The corporationCorporation will pay the cost of preparing, assembling, printing, mailing and soliciting proxies and any additional material that the corporationCorporation sends to its shareholders. The corporationCorporation will make arrangements with brokerage firms and other custodians, nominees and

fiduciaries to forward proxy solicitation materials to the beneficial owners of stock held by these entities. The corporationCorporation will, upon request, reimburse these third parties for their reasonable expenses in forwarding expenses.solicitation material to the beneficial owners of stock.

Only shareholders of record as of the close of business on February 17, 2009,16, 2010, may vote at the annual meeting. The corporation’sCorporation’s records show that, as of the voting record date, 3,479,780 shares of common stock were outstanding. On all matters to come before the annual meeting, shareholders may cast one vote for each share held. Cumulative voting rights do not exist with respect to the election of directors. See “Principal Shareholders” on page 2933 for a list of the persons known by the corporationCorporation to be beneficial owners of 5% or more of the corporation’sCorporation’s common stock.

If your shares are registered directly in your name with Mid Penn Bancorp, Inc.’sthe Corporation’s transfer agent, Registrar and Transfer Company, you are considered, with respect to those shares, the shareholder of record, and these proxy materials are being sent directly to you by the corporation.Corporation. As the shareholder of record, you have the right to grant your voting proxy directly to the proxy holders or to vote in person at the meeting. The corporationCorporation has enclosed a proxy for your use.

If your shares are held in a stock brokerage account or by a bank or other nominee, you will receive instructions from the holder of record who has forwarded these materials to you. You must follow the instructions of the holder of record in order for your shares to be voted. If your shares are considered the beneficial owner of shares heldnot registered in streetyour name and these proxy materials are being forwarded to you by your broker or nominee which is considered, with respect to those shares, the shareholder of record. As the beneficial owner, you have the right to direct your broker howplan to vote and are also invited to attend the meeting. However, because you are not the shareholder of record, you may not vote theseyour shares in person at the meeting. Yourannual meeting, you should contact your broker or nominee has enclosedagent to obtain a voting instructionlegal proxy or broker’s proxy card for youand bring it to usethe annual meeting in directingorder to vote.

For shares held in “street name” through a broker, bank or other nominee, the broker, bank or nominee howmay not be permitted to vote your shares.exercise voting discretion with respect to some of the matters to be acted upon. Thus, if shareholders do not give their broker, bank or nominee specific instructions, including with respect to director elections, their shares will not be voted on those matters and will not be counted in determining the number of shares necessary for approval.

By properly completing a proxy, the shareholder appoints Roberta A. Hoffman, Randall L. Klinger and Eric S. WilliamsScott W. Micklewright as proxy holders to vote the shares as indicated on the proxy. Proxy holders will vote any signed proxy, not specifying to the contrary,FOR the election of Jere M. Coxon, Rory G. RitrieviA. James Durica, Theodore W. Mowery, Donald E. Sauve and Edwin D. SchlegelWilliam A. Specht, III as Class BC directors for 3-yearthree-year terms expiring in 2012.2013, andFOR the non-binding proposal on executive compensation and the ratification of ParenteBeard LLC as the Corporation’s independent registered public accounting firm for 2010.

The Board of Directors proposes to mail this proxy statement to the corporation’s shareholders on or about March 27, 2009.

Quorum and Vote Required For Approval

In order to hold the annual meeting, a “quorum” of shareholders must be present. Under Pennsylvania law and the corporation’sCorporation’s By-laws, the presence, in person or by proxy, of the holders of a majority of the shares entitled to vote is necessary to constitute a quorum for the

transaction of business at the meeting. The proxy holders will count votes withheldNon-votes by banks, brokerage houses, custodians, nominees and other fiduciaries (“broker non-votes”) and abstentions whenwill be counted for the purpose of determining the presencewhether a quorum is present, but broker non-votes will not be included for determining whether shareholder approval of a quorum for each matter. The proxy holders will not count broker non-votes when determining the presence of a quorum for the particular matter as to which the broker withheld authority.has been obtained.

If a quorum is present, the threefour candidates for director receiving the highest number of votes cast, even if less than a majority, by shareholders will be elected. The proxy holdersConsequently, any shares not voted (whether by abstention, broker non-vote or otherwise) will not cast votes withheldbe included in determining which nominees received the highest number of votes. A properly executed proxy that withholds authority with respect to the election of one or broker non-votesmore directors will not be voted with respect to the director or directors indicated, although it will be counted for the Board’s nominees.

Ifpurposes of determining whether there is a quorum is present, approval and adoption of the proposed amendment of the Articles of Incorporation will require the affirmative vote of at least sixty-six and two-thirds percent (66 2/3%) of the outstanding shares of common stock entitled to vote.quorum.

If a quorum is present, approval of the non-binding proposal on executive compensation and ratification of the appointment of ParenteBeard LLC as the Corporation’s independent registered public accounting firm for 2010 will require the affirmative vote of the holders of at least a majority of the votes cast at the annual meeting. Under Pennsylvania law, abstentions are not considered “votes cast” and, accordingly, will not affect the outcome of the voting on the non-binding proposal on executive compensation or the ratification of the appointment of ParenteBeard LLC.

Revocability of Proxy

Shareholders of record who sign proxies may revoke them at any time before they are voted by:

You have the right to vote and, if desired, to revoke your proxy any time before the vote is taken at the annual meeting. Should you have any questions, please call Cindy L. Wetzel at (717)  692-2133.

Methods of Voting

Shareholders of record can choose one of the following ways to vote:

Voting by Proxy

Voting in Person

GOVERNANCE OF THE CORPORATION

Governance

OurThe Board of Directors believes that the purpose of corporate governance is to ensure that we maximizeit maximizes shareholder value in a manner consistent with legal requirements and the highest standards of integrity. The Board has adopted and adheres to corporate governance practices, which the Board and senior management believe promote this purpose, are sound and represent best practices. We continually review theseThese governance practices, Pennsylvania law (the state in which we are incorporated)of incorporation), the rules and listing standards of The NasdaqNASDAQ Stock Market Inc.LLC (“Nasdaq”NASDAQ”) and SECSecurities and Exchange Commission (“SEC”) regulations, as well as best practices suggested by recognized governance authorities.authorities are continually reviewed.

Currently, ourthe Board of Directors has ten members. Under the NasdaqNASDAQ standards for independence, the following directors meet the standards for independence: Jere M. Coxon, Matthew G. DeSoto, A. James Durica, Robert C. Grubic, Gregory M. Kerwin, Theodore W. Mowery, Donald E. Sauve, and William A. Specht, III. This constitutes more than a majority of our Board of Directors.the Board. Only independent directors serve on ourthe Audit, Compensation and Nominating and Corporate Governance Committees.

In determining the directors’ independence, the Board of Directors considered loan transactions between the bankBank and the directors, their family members and businesses with whom they are associated, as well as any contributions made to non-profit organizations with whom they are associated.

The table below includes a description of other categories or types of transactions, relationships or arrangements considered by the Board (in addition to those listed above) in reaching its determination that the directors are independent.

Name		Independent		Other Transactions/Relationships/Arrangements
Mr. Coxon		Yes		None
Mr. DeSoto		Yes		None
Mr. Durica		Yes		None
Mr. Grubic		Yes		Engineering Services
Mr. Kerwin		Yes		Legal Services
Mr. Mowery		Yes		Insurance Commissions
Mr. Sauve		Yes		None
Mr. KerwinSpecht		Yes		None
Mr. Mowery		Yes		None
Mr. Sauve		Yes		Food Purchases
Mr. Specht		Yes		NoneSafety Equipment

In each case, the Board determined that none of the transactions above impaired the independence of the director. For more information, please refer to “Certain Relationships and Related Transactions” on page 29.32.

During the year ended December 31, 2009, the Corporation’s and Bank’s Boards of Directors each held thirteen meetings. In addition, the Corporation’s independent Board members held one independent Board Meeting during 2009.

Board Leadership Structure

The corporation’s Board is led by a non-executive Chairman selected by the Board from time to time. After serving as Interim President and Chief Executive Officer of Directorsthe Corporation and the Bank from October 29, 2008 to February 25, 2009, Edwin D. Schlegel resumed his position as non-executive Chairman of the Board effective February 25, 2009. The Chairman of the Board organizes Board activities to enable the Board to effectively provide guidance to and oversight and accountability of management. To fulfill that role, the Chairman, among other things: creates and maintains an effective working relationship with the Chief Executive Officer and other members of management and with other members of the Board; provides the Chief Executive Officer ongoing direction as to Board needs, interests and opinions; and assures that the Board agenda is appropriately directed to the matters of greatest importance to the Corporation. In carrying out his responsibilities, the Chairman preserves the distinction between management and oversight, maintaining the responsibility of management to develop corporate strategy and the responsibility of the Board to review and express its views on corporate strategy. The functions of the Chairman include:

Risk Oversight by Board

The Board oversees all business, property and affairs of the corporation.Corporation. The Chairman and the corporation’sCorporation’s officers keep the members of the Board informed of the corporation’sCorporation’s business through meetings and by providing reports and other materials to the members. During fiscal 2008, the corporation’s and bank’s Boards of Directors each held 14 meetings.

In addition to the corporation’s independentgeneral oversight of Bank business, the Board members held 5 independent Board Meetings during fiscal 2008.also reviews a comprehensive quarterly Risk Management Report, prepared by the Bank’s Senior Risk Officer, which includes metrics and trends on ten major risk areas, including asset quality, interest rate risk, capital adequacy and liquidity.

Code of Ethics

In 2003, as required by law and regulation, the corporationCorporation’s and the bankBank’s Board of Directors adopted a Code of Ethics. We amended our Code of Ethics twice in 2005 and again on February 22, 2006. We have filed a copy of the amended Code of Ethics that applies to its directors, officers and employees with the SEC as Exhibit 14 to the Form 8-K filed on February 27, 2006.employees. The Code of Ethics encourages individuals to report any conduct that they believe in good faith to be an actual or apparent violation of the Code of Ethics. The Code of Ethics is available on theInvestor Relations page of Mid Penn’sthe Bank’s website atwww.midpennbank.com.

Shareholder Communications

Any shareholder who wishes to communicate with the Board of Directors may send correspondence to Kevin W. Laudenslager, Vice President and Treasurer, Mid Penn Bancorp, Inc., at 349 Union Street, Millersburg, Pennsylvania 17061. Written communications received from shareholders are shared with the full Board or appropriate committee as warranted. The Board has a complaint procedure for communicating accounting, internal accounting controls and auditing matters. Complaints generated are directed to a separate mailing address, which is under the control of the Chairman of the Audit Committee. Please refer to theInvestor Relations page of Mid Penn’s website atwww.midpennbank.com for complete details.

A shareholder who intends to nominate an individual for election to the Board of Directors (other than a candidate proposed by the Board of Directors)Board) must notify the Secretary of the corporationCorporation in compliance with the requirements of Article 10, Section 10.1 of the corporation’sCorporation’s By-laws. Any shareholder who intends to nominate a candidate for election to the Board of Directors must notify the Secretary of the corporationCorporation in writing not less than the earlier

of (1) 120 days prior to the anniversary date of the initial proxy materials or of a notice of the meeting by the corporationCorporation in connection with the immediately preceding annual meetingAnnual Meeting of shareholdersShareholders (which would be November 27, 200926, 2010 for the 20102011 annual meeting), or (2) the deadline for submitting shareholder proposals for inclusion in a proxy statement and form of proxy as calculated under Rule 14a-8(e) promulgated by the Securities and Exchange Commission.

Annual Meeting Attendance

All directors attended the 20082009 Annual Meeting of Shareholders. While the corporationCorporation does not have a formal policy regarding attendance, all directors are strongly encouraged to attend the Annual Meeting of Shareholders.

Committees and Meetings of the Corporation’s Board of Directors

During 2008,2009, the Board of Directors ofmaintained four standing committees: Executive, Audit and Compensation Committees, which jointly serve the corporation maintained three standing committees:Corporation and the Bank, and the Nominating and Corporate Governance Committee, which serves only the Corporation. Only independent directors serve on the Audit, Compensation and Nominating and Corporate Governance Committees, which jointly serve the corporation and the bank. Only independent directors serve on these committees. Chairman Schlegel attends committeethese meetings only when and to the extent requested by the committees. Committee membership is displayed in the following table.

COMMITTEE MEMBERSHIP TABLE

Each of the directors attended at least 75% of the total number of Board meetings and committee meetings for the Corporation and the Bank during their tenure on the Board in 2009.

The function of each of these committees is described below.

AUDIT. This committee oversees audit coverage, selects the independent registered public accounting firm, reviews the annual financial statements of the corporation and auditor’s reports, and monitors with management and the auditor the system of internal controls and its accounting and reporting practices. All members of the Audit Committee are non-employee directors and are independent as defined by Nasdaq listing standards. The Audit Committee has a charter which is attached as Appendix A. A. James Durica serves as the Audit Committee Financial Expert and Chairman of this committee.

NOMINATING AND CORPORATE GOVERNANCE.GOVERNANCE. This committee identifies individuals qualified to become Board members of the Board. It also evaluates and selects, or recommends to the Board, director nominees for each election of directors. This committee also monitors and makes recommendations to the Board on other matters of Board policies and practices relating to corporate governance. All members of the Nominating and Corporate Governance Committee are independent (as independence is currently defined by NasdaqNASDAQ listing standards). Robert C. Grubic serves as Chairman of this committee.

The Nominating and Corporate Governance Committee has a charter which is attached as Appendix B.available on theInvestor Relations page of the Bank’s website atwww.midpennbank.com. Candidates for director must be qualified in terms of education, professional experience, business contacts and special skills. Other less tangible, but equally important qualifications include general representation from the markets served, enthusiasm, maturity, reputation, compatibility with other members of the Board, members, diplomacy and independent judgment. In addition, candidates should have a vested interest in the corporationCorporation through ownership of corporationCorporation stock. The Nominating and Corporate Governance Committee Policy and Charter was revised in August 2007 and again in July 2008. Board candidates, upon their appointment, are required to own 500 shares with the understanding that they accumulate a minimum of 2,500 shares in total by the end of their second year on the Board. The Board recognizes that Boardits members have various abilities to acquire shares beyond the minimum threshold depending on their personal circumstances and may, in special circumstances, extend the two-year period for

accumulating 2,500 shares to a longer period of time as determined by the Board. Members of the Board are encouraged to continue to accumulate shares over time to the extent possible considering their personal circumstances.

The

When developing a list of potential nominees, the Nominating and Corporate Governance Committee’s process for identifying and evaluating nominees consists of compiling a list of nominees recommendedCommittee may take into consideration names provided by shareholders, Mid Penn Bancorp, Inc. directors and individuals who have approached officers and directors for consideration.or executive management. Information is gathered concerning the potential Board member’s location of business and residence, shares owned, profession or business, and deposit and loan relationship with the bank.Bank. Personal information about the individual is also gathered to determine if he/she meets the criteria listed in the Nominating and Corporate Governance Committee Policy and Charter. The Nominating and Corporate Governance Committee screens this information to narrow its search of final candidates to be interviewed. Upon completion of the interviews, the Nominating and Corporate Governance Committee makes a final recommendation to the full Board of Directors for appointment. All potential candidates are screened by the same process regardless of whether they were recommended by a shareholder or by another party.

EXECUTIVE. This committee may exercise the authority of the Board in the intervals between the meetings of the Board so far as may be permitted by law. Edwin D. Schlegel serves as Chairman of this committee.

AUDIT. This committee oversees audit coverage, selects the independent registered public accounting firm, reviews the annual and quarterly financial statements of the Corporation and auditor’s reports, and monitors with management and the auditor the system of internal controls and its accounting and reporting practices. All members of the Audit Committee are non-employee directors and are independent as defined by NASDAQ listing standards. The Audit Committee has a charter which is available on theInvestor Relations page of the Bank’s website atCOMPENSATIONwww.midpennbank.com. A. James Durica serves as the Audit Committee Financial Expert and Chairman of this committee.

COMPENSATION. This committee assures that senior executives are compensated effectively in a manner consistent with the bank’sBank’s compensation strategy, internal equity considerations, competitive practice and the requirements of the appropriate regulatory bodies. This committee also reviews salary adjustments, compensation and benefits programs for all employees and makes recommendations to the BoardBoard. All members of Directors.the Compensation Committee are independent (as independence is currently defined by NASDAQ listing standards). The Compensation Committee has a charter which is attached as Appendix C.available on theInvestor Relations page of the Bank’s website atwww.midpennbank.com. Theodore W. Mowery serves as Chairman of this committee.

Each of the directors attended at least 75% of the total number of Board of Directors meetings and committee meetings for the corporation and the bank during their tenure on the Board in 2008.

EXECUTIVE OFFICERS

Executive Officers of Mid Penn Bancorp, Inc.the Corporation and Mid Pennthe Bank

The following table sets forth, as of the date of this proxy statement, selected information about the corporation’sCorporation’s and bank’sBank’s executive officers, each of whom is elected by the Board of Directors and each of whom holds office at the Board’s discretion.

AUDIT COMMITTEE REPORT

The Board of Directors adopted a written charter for the Audit Committee. As required by the charter, the Audit Committee, in fulfilling its oversight responsibilities regarding the audit process:

Based upon the review and discussions referred to above, the Audit Committee recommended to the Board of Directors that the audited consolidated financial statements for the year ended December 31, 2008,2009, be included in the corporation’s Annual Report on Form 10-KCorporation’s annual report and filed with the Securities and Exchange Commission.SEC.

Aggregate fees billed to the corporationCorporation and the bankBank by ParenteBeard LLC, (formerly Beard Miller Company, LLP and Parente Randolph, LLC,LLC) the independent registered public accountants, for professional services rendered are as follows:

Audit fees for 2009 include professional services rendered for the audit of the Corporation’s annual consolidated financial statements (including amounts not yet billed but expected to be billed) and review of consolidated financial statements included in Forms 10-Q and the audit of internal controls in accordance with Section 404 of the Sarbanes-Oxley Act, including out-of-pocket expenses. Audit fees billed for 2008 include professional services rendered for the audit of annual financial statements and fees billed for the review of financial statements included in Mid Penn Bancorp, Inc. Forms 10-Q or services that have normally been provided by Parente Randolph, LLC (now ParenteBeard LLC) in connection with statutory and regulatory filings or engagements.engagements and the audit of internal controls in accordance with Section 404 of the Sarbanes-Oxley Act, including out-of-pocket expenses.

Audit related fees for 2009 include assurance and related services related to the performance of employee benefit plan audits. Audit related fees billed for 2008 include professional services rendered by Parente Randolph, LLC (now ParenteBeard LLC) for reporting on Sarbanes-Oxley Section 404 compliance and includes the audit of the employee benefit plan in 2008.plans.

Tax fees for 2009 include the preparation of state and federal tax returns and tax consultations. Tax fees for 2008 include fees billed for professional services rendered by Parente Randolph, LLC for tax advice and tax preparation. In 2008, the Audit Committee engagedpaid to Beard Miller Company LLP for tax advice and tax preparation; therefore no fees were paid to Parente Randolph, LLC in 2008(now ParenteBeard LLC) for tax advice and tax preparation.

This report of the Audit Committee shall not be deemed incorporated by reference by any general statement incorporating by reference this proxy statement into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except to the extent that the corporationCorporation specifically incorporates this information by reference, and shall not otherwise be deemed filed under such Acts.

The foregoing report has been furnished by the current members of the Audit Committee, which is comprised of five directors, all of whom are considered “independent” as defined in NasdaqNASDAQ listing standards. A. James Durica is qualified as a financial expert within the meaning of SEC and NasdaqNASDAQ listing standards, and the Board has determined that he has accounting and related financial management expertise to satisfy SEC and NasdaqNASDAQ requirements.

The Audit Committee developed a policy for pre-approval for services provided by the independent auditors. The policy requires the Audit Committee to pre-approve all audit and permissible non-audit services provided by the independent auditors. These services may include audit services, audit related services, tax services and other permissible services. Under the policy, pre-approval will generally be provided for up to one year and any pre-approval is detailed as to the particular service or category of services. In addition, the Audit Committee may also pre-approve particular services on a case-by-case basis. Prior to approval, the Committee verifies with the auditor the nature of the proposed services to ensure independence will not be compromised. Under the policy, a de minimis exception is provided whereby pre-approval may be waived for non-audit services that meet all of the following requirements:

Parente Randolph,ParenteBeard LLC advised us that none of its members has any financial interest in the corporationCorporation or the bank.Bank.

Change to Beard Miller Company LLP

On February 25, 2009, the Audit Committee of the Board of Directors approved the dismissal of Parente Randolph, LLC. Such termination will bewas effective upon completion of services related to the audit of the Company’sCorporation’s December 31, 2008 financial statements. On February 26, 2009, Parente Randolph, LLC, our currentthe independent registered public accountants were notified of the dismissal.

The reports of Parente Randolph, LLC on the financial statements of the CompanyCorporation for the years ended December 31, 2008 and 2007 did not contain either an adverse opinion or a disclaimer of opinion, nor were the reports qualified or modified as to uncertainty, audit scope or accounting principles.

The CompanyCorporation had no disagreements with Parente Randolph, LLC on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure during the two most recent fiscal years or the subsequent interim period, which if not resolved to the satisfaction of Parente Randolph, LLC would have caused it to make reference to the subject matter of the disagreement in connection with its reports on the financial statements for such years.

There were no reportable events within the meaning of Item 304(a)(1)(v) of Regulation S-K during the two most recent fiscal years or the subsequent interim period.

The Company hasCorporation provided Parente Randolph, LLC with a copy of the above disclosures in response to Item 304(a) of Regulation S-K in conjunction with the filing of its Form 8-K. The

Company Corporation requested that Parente Randolph, LLC deliver to the CompanyCorporation a letter addressed to the Securities and Exchange Commission stating whether it agrees with the statements made by the CompanyCorporation in response to Item 304(a) of Regulation S-K, and if not, stating the respects in which it does not agree. A copy of the letter of Parente Randolph, LLC was filed as Exhibit 99.1 to its Current Report on Form 8-K Current Report.8-K.

On February 25, 2009, the Audit Committee of the Board of Directors approved the engagement of Beard Miller Company LLP as the Company’sCorporation’s independent public accountant for the Company’s fiscalCorporation’s year endingended December 31, 2009 and the interim periods prior to such year-end, subject to completion of Beard Miller Company LLP’s standard engagement acceptance procedures. During the Company’sCorporation’s two most recent fiscal years and any subsequent interim period, neither the CompanyCorporation nor anyone on its behalf hashad consulted with Beard Miller Company LLP regarding (i) the application of accounting principles to a specific transaction, either completed or proposed, or (ii) the type of audit opinion that might be rendered on the Company’sCorporation’s financial statements, or (iii) any matter that was the subject of a disagreement within the meaning of Item 304 (a)(1)(iv) of Regulation S-K, or (iv) any reportable event within the meaning of Item 304 (a)(1)(v) of Regulation S-K.

Change to ParenteBeard LLC

On October 1, 2009, the Corporation was notified that the audit practice of Beard Miller Company LLP was combined with ParenteBeard LLC in a transaction pursuant to which Beard Miller Company LLP combined its operations with ParenteBeard LLC and certain of the professional staff and partners of Beard Miller Company LLP joined ParenteBeard LLC either as employees or partners of ParenteBeard LLC. Accordingly, on October 1, 2009, Beard Miller Company LLP resigned as auditors of the Corporation and, the Audit Committee engaged ParenteBeard LLC as the Corporation’s independent registered public accounting firm.

Prior to engaging ParenteBeard LLC, the Corporation did not consult with ParenteBeard LLC regarding the application of accounting principles to a specific completed or contemplated transaction or regarding the type of audit opinions that might be rendered by ParenteBeard LLC on the Corporation’s financial statements, and ParenteBeard LLC did not provide any written or oral advice that was an important factor considered by the Corporation in reaching a decision as to any such accounting, auditing or financial reporting issue.

As discussed above, Beard Miller Company LLP was appointed as the Corporation’s independent registered public accounting firm on February 25, 2009 for the Corporation’s year ending December 31, 2009 and was not engaged to perform audits of the Corporation’s consolidated financial statements for the years ended December 31, 2008 or 2007.

During the interim period from January 1, 2009 through October 1, 2009, the date of resignation, there were no disagreements with Beard Miller Company LLP on any matter of accounting principles or practices, financial statement disclosure or auditing scope or procedures, which disagreements, if not resolved to the satisfaction of Beard Miller Company LLP would have caused it to make reference to such disagreement in its reports.

The Corporation provided Beard Miller Company LLP with a copy of the above disclosures in response to Item 304(a) of Regulation S-K in conjunction with the filing of its Form 8-K. The Corporation requested that Beard Miller Company LLP deliver to the Corporation a letter addressed to the Securities and Exchange Commission stating whether it agrees with the statements made by the Corporation in response to Item 304(a) of Regulation S-K, and if not, stating the respects in which it does not agree. A copy of the letter of Beard Miller Company LLP was filed as Exhibit 16.1 to its Current Report on Form 8-K.

Audit Committee

PROPOSAL NO. 1: ELECTION OF DIRECTORS

Qualifications and Nomination of Directors

The corporation’sCorporation’s By-laws authorize the number of directors to be not less than five (5) nor more than twenty-five (25). The By-laws also provide for three classes of directors with staggered 3-yearthree-year terms of office. Terms of the members of each Class expire at successive annual meetings. Currently, Class A consists of three directors, Class B consists of three directors and Class C consists of four directors.

The Board of Directors nominated the threefour persons named below to serve as directors until the 2012 annual meeting2013 Annual Meeting of shareholdersShareholders and until his successors are duly elected and qualified or until theirhis earlier death, resignation, retirement or removal from office. The nominees are presently members of the Board of Directors and have consented to serve another term as a director if re-elected. If the nominees should be unavailable to serve for any reason, a majority of the Board of Directors then in office may select someone to fill the vacancy until the expiration of the term of the classClass of directors to which he or she is appointed.

The Board of Directors is divided into three classes. Terms of the members of each class expire at successive annual meetings. Currently, Class A consists of three directors, Class B consists of three directors, and Class C consists of four directors. Shareholders will elect three Class B directors at this annual meeting to serve for a 3-year term.

The proxy holders intend to vote proxies for the election of each of the threefour nominees named below, unless you indicate that your vote should be withheld from any or all of them. Each nominee elected asUnlike previous years, brokers holding shares beneficially owned by their clients will no longer have the ability to cast votes with respect to the election of directors unless they have received instructions from the beneficial owner of the shares.It is therefore important that you provide instructions to your broker if your shares are held by a director will continue in office until his or her successor has been duly elected and qualified, or until his or her death, resignation, retirement or removal from office.broker so that your vote with respect to directors is counted.

The Board of Directors proposes the following nominees for election as Class BC Directors at the annual meeting:

The Board of Directors recommends that shareholders voteFOR the election of the nominees listed above as Class B Directors of Mid Penn Bancorp, Inc.THE BOARD UNANIMOUSLY RECOMMENDS A VOTE “FOR” THE ELECTION OF EACH OF THE NOMINEES LISTED ABOVE AS CLASS C DIRECTORS OF MID PENN BANCORP, INC.

INFORMATION REGARDING DIRECTOR NOMINEES

AND CONTINUING DIRECTORS

Information, as of the date of this proxy statement, concerning the threefour nominees to the Board of Directors and the sevensix continuing directors appears below. You will find information about their share ownership on page 30.34.

Current Class A Directors(to serve until 2011)

Matthew G. DeSoto, age 33, has been a director since January 1, 2008. In 2008, Mr. DeSoto became President and Chief Operating Officer of MI Windows and Doors, Inc. in Gratz, PA, where he previously served as Eastern Region President and Executive Vice President. MI Windows and Doors is a nationwide fabricator of window and patio door products for residential projects. Mr. DeSoto is a member of The Ned Smith Center for Nature and Arts Finance Committee. He previously served on the Policy Advisory Board of Directors - Continuingthe Harvard University Joint Center for Housing Studies. Mr. DeSoto attended The Pennsylvania State University obtaining a Bachelor of Science Degree in Marketing. The Board has determined that as DirectorsPresident and COO of MI Windows and Doors, Inc., Mr. DeSoto’s knowledge in all aspects of business operations is an asset to the Corporation and qualifies him to serve on the Board as well as on the Audit and Compensation Committees.

Robert C. Grubic, age 58, has been a director since 2006. In 1989, Mr. Grubic became President and Chief Executive Officer of Herbert, Rowland & Grubic, Inc., a consulting engineering firm based in Harrisburg, PA. He has been employed by the firm and its predecessor firm since 1973. Mr. Grubic has a Bachelor of Civil Engineering degree from Villanova University and a Master of Administration Degree from The Pennsylvania State University. Mr. Grubic is a member of the Board of the Harrisburg Regional Chamber of Commerce and serves on the State Registration Board for Professional Engineers, Land Surveyors and Geologists. He has also served on numerous civic and community boards and groups in the greater Harrisburg area. Mr. Grubic has overall management responsibility of the 240 person engineering firm of Herbert, Rowland & Grubic, Inc., including oversight of all financial, administrative, human

resources and technical components of the firm. Due to his many years of experience in managing a successful engineering firm, the Board feels Mr. Grubic’s vast knowledge of business operations is invaluable and qualifies him to serve on the Corporation’s Board, serving in the capacity of Vice-Chairman, and on the Corporation’s Executive, Compensation and Nominating and Corporate Governance Committees.

Gregory M. Kerwin, age 59, has been a director since 1999. In 1975, Mr. Kerwin became an associate, and is now senior partner in the firm of Kerwin & Kerwin, Attorneys at Law in Elizabethville, PA. A large part of the practice of the law firm deals in real estate transactions which involve bank financing. Mr. Kerwin has represented hundreds of clients (buyers, sellers, and lenders) participating in such transactions. During the past 34 years, Mr. Kerwin, as solicitor, has represented over ten municipal governments and authorities in Northern Dauphin County. As a result of his association with these organizations, Mr. Kerwin is keenly aware of the strengths, assets and needs of the Bank’s local communities. Mr. Kerwin has a Bachelor of Arts Degree in Political Science from The Pennsylvania State University and a Juris Doctor from The Dickinson School of Law in Carlisle, PA. Because of his legal expertise, his knowledge in managing his own law firm and his knowledge of the Bank’s local community, the Board has determined that Mr. Kerwin adds value to the Corporation and is qualified to serve on the Board, as well as on the Executive and Nominating and Corporate Governance Committees.

Current Class B Directors(to serve until 2009)

and

Nominees for Class B Directors (to serve until 2012)

Jere M. Coxon, age 67, has been a director since 1991. Mr. Coxon is semi-retired Executive Vice President of both Penn Wood Products, Inc., a manufacturing company, and Appalachian Realty Corp., a real estate holding company, of East Berlin, PA. Mr. Coxon also serves on the Board of Directors of Bethesda Mission in Harrisburg, PA. He received a Bachelor of Arts Degree in Business Management from Texas Wesleyan University and previously worked as a Cost Accountant for Lenox Inc. in Fort Worth, TX. Mr. Coxon has served on the Corporation’s Board since its formation in 1991 and has served on the Bank’s Board of Directors since 1981. The Board has determined Mr. Coxon’s expertise in business and his many years of Board experience add value to the Corporation and qualify him to serve as a Director and also on the Corporation’s Audit, Compensation, Executive and Nominating and Corporate Governance Committees.

Edwin D. Schlegel		Mr. Schlegel, age 71, has been Chairman of the Board of the corporation since 2008 and has been a director since 1991. He served as Interim President and Chief Executive Officer from October 29, 2008 to February 25, 2009. Mr. Schlegel is retired and previously served as Superintendent of the Millersburg Area School District.

Rory G. Ritrievi, age 46, has been a director since February 25, 2009. On February 25, 2009, Mr. Ritrievi joined the Corporation and the Bank as President and Chief Executive Officer. Mr. Ritrievi worked in the financial services industry for more than 23 years. He previously served as Senior Executive Vice President/Market President and Chief Lending Officer of Commerce Bank/Harrisburg, where he managed all aspects of the customer experience including the retail network, lending, marketing and public relations. As Chief Lending Officer, Mr. Ritrievi was responsible for loan production, credit quality and credit administration. Mr. Ritrievi holds a Juris Doctor from Widener University School of Law and a Bachelor of Arts Degree in Economics from the University of Pittsburgh. He was awarded the Widener University School of Law Distinguished Young Alumni honor in 1999. In addition to being named one of Central Penn Business Journal’s Forty under 40, Mr. Ritrievi earned the Central PA Chapter of The Leukemia and Lymphoma Society’s Man of the Year award in 2003.

Mr. Ritrievi also serves on the HACC Foundation Board of Directors. Because of his educational and leadership skills, extensive knowledge and experience in many phases of banking, the Board concluded that Mr. Ritrievi was the right person to lead the Corporation and the Bank and feels that these attributes qualify him to serve as President and CEO of the Corporation and the Bank and also as a member of both Boards and the Executive Committee. His service has been a valuable addition to the Corporation and the Bank.

Edwin D. Schlegel, age 72, has been Chairman of the Board of the Corporation and the Bank since 2008 and has been a director of the Corporation since 1991 and a director of the Bank since 1981. He served as Interim President and Chief Executive Officer from October 29, 2008 to February 25, 2009. Mr. Schlegel is retired and most recently served as Superintendent of the Millersburg Area School District. His employment consisted of class room teacher, school administrator and school district superintendent. He is a member of the Millersburg Board of Education and the Capital Area Intermediate Unit Board of Education. Mr. Schlegel has a Bachelor of Science degree in Education from Shippensburg State College, a Master of Science Degree in Education and certification in Educational Administration from Temple University and a certification (letter of eligibility) of School District Superintendent from Bucknell University. Mr. Schlegel has continued his education by attending various banking seminars. Mr. Schlegel is an active volunteer in the Millersburg community. The Board determined that Mr. Schlegel’s active Board involvement over the past 28 years, his investment in the Corporation and strong leadership skills qualify him to serve as Chairman of the Board of the Corporation and the Bank and as a member of the Executive Committee. The Board has found Mr. Schlegel’s service to be of great value to the Corporation and the Bank.

Current Class C Directors and Class C Director Nominees( (to serve until 2013)

A. James Durica, age 62, has been a director since 2003. Mr. Durica is self-employed in Hershey, PA as a financial consultant primarily involving areas of treasury, investments, accounting, Sarbanes-Oxley compliance, planning, and mergers and acquisitions. He previously served as Senior Vice President, Treasurer and Chief Investment Officer of Keystone Financial, Inc., a $7 billion multi-state Banking organization headquartered in Harrisburg, PA, acquired by M&T Bancorp. As head of Keystone’s proprietary mutual fund business segment, Mr. Durica was President of Governor Funds until merged with M&T’s funds in 2001. Mr. Durica also served as CFO and Treasurer in other banking organizations in the past and has over 20 years experience as a senior officer in banking at public companies, along with 10 years experience in public accounting at an international firm. Mr. Durica is a Certified Public Accountant, currently licensed in Pennsylvania and Florida. He has a Bachelor of Science Degree in Accounting from The Pennsylvania State University. He is a member of American Institute of Certified Public Accountants, Florida Institute of Certified Public Accountants and Beta Gamma Sigma, and has chaired committees in FICPA and the Pennsylvania Bankers Association. The Board has determined that Mr. Durica’s vast knowledge of and experience in the financial services and accounting industries qualify him to serve until 2010)as a member of the Board, Financial Expert and Chairman of the Audit Committee and as a member of the Executive and Nominating and Corporate Governance Committees. The Board has found Mr. Durica’s expertise to be of significant value to the Corporation.

Theodore W. Mowery, age 51, has been a director since 2003. Mr. Mowery is a partner with Gunn Mowery, LLC in Camp Hill, PA. Mr. Mowery is a licensed dealer in life, health, property and casualty insurance. He also holds a Securities Series 6 and 63 license. Mr. Mowery is a founding partner of Gunn Mowery LLC, who currently employs 60 people and manages over $100 million in insurance premiums. He is a founding partner in Gaughen Insurance, Inc., an insurance agency partnering with Gaughen Realty. Mr. Mowery is also a partner in Gunn Mowery Properties, LLC, a real estate holding company. Mr. Mowery serves as a Board member of the Lion Foundation. He is past President of the Camp Hill School Board, past President of the Mental Health Association of Cumberland, Dauphin and Perry Counties and past Board member of the West Shore Country Club. Mr. Mowery has a Bachelor of Arts Degree in Health and Physical Education from Gettysburg College. Due to his vast knowledge of the insurance services industry and his experience in managing all aspects of his own company, the Board has determined that Mr. Mowery has added value to the Corporation and is qualified to serve as a member of the Board, as well as the Audit, Compensation and Nominating and Corporate Governance Committees.

Donald E. Sauve, age 68, has been a director since 1999. Mr. Sauve is retired. He founded his own supermarket business, Don’s Food Market, Inc. in Lykens, PA, and later became a consultant to that company. Mr. Sauve has been involved with banking for many years. He served as a collection agent for Investors Loan Company and served on three bank Boards. He has also attended many banking seminars. Mr. Sauve is active with the Lykens Chamber of Commerce, which is involved with revitalizing the Lykens community. The Board has determined that Mr. Sauve’s business skills in managing all aspects of his own business qualify him to serve on the Board and on the Audit and Compensation Committees.

William A. Specht, III, age 48, has been a director since 2006. Mr. Specht became President and CEO of Seal Glove Manufacturing, Inc. in 2005, where he previously served as Vice President. He is also President of Ark Safety, previously serving as Vice President, and is President of Rescue Remedies, a company purchased in 2006. As President and CEO of his business affiliations, Mr. Specht is knowledgeable in all aspects of business operations. He also serves on the Boards of Directors of all three companies. Mr. Specht previously served as a Board member of MANTEC, a non-profit Corporation, a member of the Consumer Advisory Board of Capital Blue Cross and as a School Board Director of the Millersburg Area School District. Mr. Specht is an active member of the Millersburg community and has served and continues to serve in various capacities with various organizations. The Board has determined Mr. Specht’s knowledge and management of his own business affiliations add value to the Corporation and qualify him to serve on the Board and Compensation Committee.

Compensation of the Board of Directors

Directors received no remuneration for attendance at the meetings of the Board of Directors of the corporation. All director fees are paid by the bank. The bankBank participates in the L. R. Webber Associates, Inc. Salary/Benefits Survey, which includes a survey of director fees and benefits. The bankBank also periodically conducts a survey of director fees, committee fees and other director compensation of banks that are similar in size and in similar markets to the bank. Based on the surveys, which are reviewed by theBank. The Compensation Committee a recommendation by the Compensation Committee is presentedreviews these surveys and recommends to the full Board any changes to the compensation of Directorsthe Board members for the

upcoming year. The Board has the final approval.approval of the compensation of its directors. The following is a summary of director fees:

During 2008, Mid Penn Bank directors earned

Mr. Ritrievi did not receive an annual fee of $12,000. Board members received $250 for each Independent Board Meeting attended from January through May 2008 and $500 for each Independent Board Meeting attended from June through December 2008. In 2008, members of the Nominating and Corporate Governance Committee received $250 for each meeting attended. Members of the Compensation Committee received $250 for each meeting attended from January through May 2008 and $300 for each meeting attended from June through

December 2008. Members of the Audit Committee received $300 for each meeting attended from January through May 2008 and $325 for each meeting attended from June through December 2008. As Lead Director, Mr. Schlegel was paid $1,000, or $250 per month, for the period January 1, 2008 through April 30, 2008. At the corporation’s annual organization meeting held in April 2008, Mr. Schlegel was named Chairman ofserving on the Board and Mr. Grubic was named Vice-Chairman. In 2008,nor did he receive any fees for attending committee meetings. Mr. Schlegel received fees of $1,800$6,000 for his services as Chairman, and Mr. Grubic received fees of $2,400$3,600 for his services as Vice-Chairman. Directors who are also officers of the bank are not paid for attending committee meetings. In 2008, the Board of Directors was paid $177,075 in the aggregate, for all Board of Directors’ fees and committee meetings attended. In addition, A. JamesMr. Durica was paid $20,004$22,040 in fees for services rendered ($2,040 of which relates to services performed during 2008) in his capacity as chairmanChairman of the Audit Committee, which includes his work to prepare for committee meetings and to attend meetings with the bank’sBank’s auditors, compliance consultants, SEC counsel, and other advisors the bankBank uses in connection with its audit program. MatthewThe Board was paid $165,450 in the aggregate, for all Board fees and committee meetings attended in 2009. Messrs. DeSoto wasand Grubic were paid an additional $100 each for attending a bankMid Penn Bank Business Development Advisory Board Meeting.meeting.

The bankBank maintains a deferred fee plan for directors, which enables a director to annually elect to defer payment of up to $8,000 of his fees until he leavesterminates service on the Board. The director receivesBank’s Board of Directors. Participating directors may elect to receive either a lump sum or equal monthly installments in an amount equal to his deferral account (plus interest) upon retirement, early termination, disability, a change in control or a hardshiphardship. If a director dies before distribution of his deferral account commences, his designated beneficiary is entitled to receive the amounts in his deferral account or death. The following are the current directors whoprojected account balance at the time the Bank adopted the deferred fee plan (limited by the amount of net coverage purchased by the Bank), whichever is greater. Messrs. Grubic, Mowery, Sauve, and Schlegel each deferred $8,000 inof their fees for 2008: Robert Grubic, Theodore Mowery, Donald Sauve and Edwin Schlegel. Deferred director fees paid to retired directors during 2008 totaled $7,970.2009.

In May 1995, the Bank adopted the Mid Penn Bank directors adopted a retirement bonus plan, subsequently renamed director retirement plan. The plan pays a retirement fee toDirector Retirement Plan. Under the Director Retirement Plan, Bank directors who voluntarily terminate their service on the Board other than for cause with at least five years of service.service are eligible to receive a retirement benefit. The retirement feefive-year service requirement is waived if a director’s service is terminated for disability or within 90 days of a change in control. The annual benefit is determined by multiplying the “base retirement amount” for the member’sdirector’s position ($533.35552.02 for the Chairman, $266.68$276.01 for all other directors, which figures reflect the inflationary adjusted rates for 2007)2009) by the number of full years the member served. No portion of the payment under this plan is assignable. The plan contains an annual inflationary adjustment provision and provides for survivor benefits. Payments due under the planprovision. Benefits are paid in cash on a quarterly basis and continue for a term of 15 years to60 quarterly payments or the director or his/her designated beneficiary. Earl Etzweiler, Harvey Hummel, Warren Miller, William Nelson, Eugene Shaffer and Guy Snyder, Jr. received a total of $47,060 under this plan in 2008.director’s death, if earlier.

The following table summarizes the total director compensation awarded orthat non-employee directors earned for services in all capacities toservice as directors of the corporationCorporation and to the bankBank for the fiscal year ended December 31, 2008.

2009. Mr. Schlegel, Chairman of the Board, also served as Interim President and Chief Executive Officer from January 1, 2009, through February 25, 2009; accordingly, his compensation is disclosed in the Summary Compensation Table.

DIRECTOR COMPENSATION TABLE

COMPENSATION DISCUSSION AND ANALYSIS

Introduction

The Board of Directors has appointed a Compensation Committee which administers the compensation program. The committee strives to offer a fair and competitive compensation policy to govern named executive officers’ base salaries and incentive plans and to attract and maintain competent, dedicated and ambitious managers whose efforts will enhance the products and services of the corporationCorporation and of the bank,Bank, resulting in higher profitability, increased dividends to the corporation’sCorporation’s shareholders and appreciation in market value of the corporation’sCorporation’s common stock.

The elements of compensation arefor 2009 for the named executive officers were base salary bonus plans, and retirement and health benefits. As eachThere was no bonus or incentive compensation program for 2009. Each element of compensation is intended to accomplish a specific goal, payments under one element areso the level of retirement and health benefits for a particular named executive officer were not taken into account when determining the amount to be paid under a different element.

Named Executive Officers’Compensation Consultant’s Role in Determining Compensation

The 2008 compensation of the named executive officers was reviewed and approved by the Board of Directors upon the recommendation of the Compensation Committee. Beginning in 2009, the compensation of the named executive officers, other thanincluding the chief executive officer’s compensation will be fixed byof the chief executive officerChief Executive Officer, was determined and approved by the Compensation Committee, of the Board of Directors, subject to ratification by the full BoardBoard.

In 2008, Mid Penn Bank hired consultant Sally Williams, President of Directors. Webber HR Solutions, LLC to provide recommendations with respect to the compensation of all employees of the Bank, including the named executive officers. Ms. Williams provided surveys and wage/salary data for each position at the Bank in the markets in which the Bank conducts business.

Management’s Role in Determining Compensation

The Compensation Committee considers the views and recommendations of the chief executive officerChief Executive Officer in making compensation decisions affecting executive officers who report to him. The chief executive officer’sChief Executive Officer’s role in recommending compensation programs is to develop and recommend appropriate performance measures and targets for individual compensation levels and to compile competitive benchmark data to assess the competitive labor market. The chief executive officer doesChief Executive Officer is not participate in thepresent during discussions or decisions regarding changes in his compensation.

Compensation Consultant’s Role in Determining Compensation

In 2008, Mid Penn Bank hired consultant Sally Williams, President of Webber HR Solutions, LLC to establish a new Wage and Salary Administration Program and New Performance Appraisal System. The Wage and Salary Administration Program and Performance Appraisal System apply to all employees of Mid Penn Bank including the named executive officers. The Wage and Salary Administration Program provides, among other things, that salary ranges are to have mid-points, which are competitive with the current market wage/salary data for each position and which reflect the markets in which the Bank conducts business.

Base Salary

Base salary is designedlevels are set to attract and retain executives who can further the strategic objectives of the corporation and bank.objectives. Base salary is a major component of the named executive officers’ compensation, and is reviewedthe Compensation Committee reviews it every year to determine whether the salary is at the appropriate level.

As mentioned above inThe “Compensation Consultant’s Role of thein Determining Compensation, Consultant,” in 2008, Mid Pennthe Bank reviewed its current salary and bonus structure for all employees with the assistance of a compensation consultant. The information provided by the compensation consultant established the appropriate ranges in which all the Bank’s employees are compensated, including the named executive officers, are compensated.officers. The minimum amount indicated in the range for a specific position is paid to all employees in that position who meet the basic qualifications in education and/or experience.

The Compensation Committee made a subjective review of the named executive officers’ performance including general management performance; strategic objectives management; reporting and communication skills; internal cooperation; policy, procedure and regulatory compliance; and public relations. After the Compensation Committee’s review of the named executive officer’s performance, the Compensation Committee using its business judgment determined the appropriate amount of base salary within the salary range.

Benchmarking

In establishing the new Wage and Salary Administration Program, theThe compensation consultant provided Mid Pennthe Bank with salary information on bank positions gathered from the L. R. Webber PA Survey for Region 5, L. R. Webber surveySurvey for Asset sizeSize 6 ($500 – $999 million), L. R. Webber Mid Atlantic Survey, America’s Community Bankers Survey, Watson-Wyatt Survey and Department of Labor for Harrisburg MSA. The final compiled survey included predominately financial institutions.

The following institutions were included in the survey based upon their location in the Adams, Baltimore (MD), Berks, Cumberland, Dauphin, Franklin, Lancaster, Lebanon, Lehigh, Perry, and York counties:

The following institutions were included in the survey based upon their asset size of $500 million to $999 million:

TheCompensation levels at these peer banks are utilizedinstitutions were used to arrive at salary ranges for all the Bank’s employees, including the named executive officers. The bank uses this surveyofficers, and as a source of information to educate itselfthe Bank on the current trends in executive pay in the Bank’s footprint and to determine if the bank’sBank’s pay scales are in accord with those of its peers. The 2008 salary increases fornamed executive officersofficers’ base salaries were not increased as a result ofsolely adjusted based on benchmarking to the salary survey, butsurvey; increases were increasedinstead based upon the individual’s actualmostly on individual performance as tied to the salary grid.

Bonus PlanIncentive Compensation

InHistorically, in order to incentincentivize employees to attain excellenceexcel in their performance for the Bank with regard to certain performance standards whichthat the Compensation Committee believes willbelieved would improve shareholder value, in 2008,a portion of the bank creatednamed executives’ compensation was paid through a formulized bonus plan. A three percentUnder the bonus will be paid toplan in place for 2008, the named executive officers were eligible employees for attaining the peer group average in two elements: Earningsa bonus based on achievement of earnings per Share (EPS)share growth and Core Deposit Growth. Additionally, a six percent bonus will be paid out for attaining five percent growth above the peer group averages with regard to these same two elements.

Over the past three years, the average EPS growth rateCertain of the peer group has been approximately 2% and the average Core Deposit Growth has been approximately 5.6%. Percentagesnamed executive officers also historically participated in between the two growth rates will be estimated and no bonus will be paid for results that fall short of the peer group averages. The EPS growth element is weighted at 70% and the Core Deposit Growth element is weighted at 30%.

Banks in this peer group include the following similar sized-banks in Central Pennsylvania:other incentive compensation programs. These programs included:

and quality goals; to motivate, reward, and reinforce superior operating performance both on a department and individual basis; to attract and retain the best commercial lenders; to encourage an atmosphere of teamwork; and to enhance profitability and productivity in support of the Bank’s immediate and future business goals. Payments made under this plan were based on both quantitative and qualitative performance measures.

In 2009, all of the Bank’s incentive compensation programs were terminated except for the Employee Referral Incentive Program. The amount paid in 2009 under the Employee Referral Incentive Plan totaled $5,000. No bonuses or individual performance. The cost of providing such plansincentive compensation were paid to all eligible employees and executive officers is not taken into account when determining specific salaries of the named executive officers and is seen as a cost of doing business.for 2009.

RetirementBenefit Plans

The bank believes that it is important to assist employees in saving for retirement and believes that by providing a mechanism to save for retirement, the bank is providing the named executive officers with incentive to continue in the employ of the bank.

The bank offers the Mid Penn Bank Retirement Plan and Employee Stock Ownership Plan (ESOP) in which the named executive officers participate. The named executives participate at the same percentage of retirement contributions as all bank employees. A summary of each plan follows.

Mid Penn Bank Retirement Plan

The named executive officers also participate in other benefit plans that are generally available to all employees and executive officers. These plans include group life insurance, group disability, health insurance and voluntary dental and vision benefits. The Bank also provides a qualified 401(k) and profit sharing plan for all of the same retirement plans as all otherBank’s eligible employees. The bank’s retirement plan rewards employees for their efforts in assisting the corporation to meet its financial goals. The level of contribution the bankBank provides is discretionary and is not tied to a specific formula. The Board of Directors approves the contribution level based on a recommendation made by the Compensation Committee. A bank contribution of 4% of base salary was provided to all eligible employees, including the named executives for 2008.

As part of the Mid Penn Retirement Plan, the bank’s 401(k) plan allows employees to save their own money for retirement, to earn a matching contribution from the bank and to direct the investment of all funds in the 401(k) plan. The amount ofan employer match contributed to the named executives’ plan is the same as contributed to all other eligible employees. This plan is viewed as a necessity to successfully hire and retain employees in a competitive marketplace. The amount of the match provided by the bank is discretionary and is approved by the Board of Directors based on the recommendation of the Compensation Committee. For 2008, the bank matched(currently 50% of the named executives’employees’ contributions, up to a maximum bankmatch of 3%) of participant’s contributions to the 401(k) plan. The Bank did not make a profit sharing contribution of 3%.

for 2009. Additionally, the Bank maintains an Employee Stock Ownership Plan

The bank maintains an ESOP (“ESOP”) for all bank employees who satisfy thecertain length of service requirements. Participants do not contributeNo contributions were made to the plan and the bank, in its discretion, may contribute. The plan is designed to reward performance and to drive an ownership culture by

rewarding employees with corporation stock. The level of the bank’s contribution is discretionary and is not tied to any specific formula. The contribution level is approved by the Board of Directors based on a recommendation by the Compensation Committee. All eligible employees, including the named executives, received a contribution of 2% of their base payparticipants’ ESOP accounts for 2008.2009.

Split Dollar PlanExecutive Agreements

Life insurance was provided only to Mr. Dakey, former Chairman,On February 25, 2009, the Bank entered into an employment agreement with Rory G. Ritrievi in connection with his appointment as President and Chief Executive Officer underof the Corporation and the Bank. The term of this agreement is two years which will renew automatically for an endorsement split-dollar arrangement which providesadditional two years on each anniversary of the agreement unless either party gives a split-dollar shareninety day notice of deathnon-renewal. Pursuant to this agreement, Mr. Ritrievi is entitled to an initial base salary, subject to annual review and increase, of $265,000 and to participate in any fringe benefits generally available to the executive’s beneficiary, dependingBank’s salaried officers, other benefits that the Board deem appropriate and reimbursement of any business expenses. The Corporation may terminate Mr. Ritrievi’s employment for “cause” (as defined in the agreement) upon thirty days written notice, and all rights and benefits under this agreement shall terminate upon the executive’s eligibility to receive payments. The plantermination date. If Mr. Ritrievi is funded with bank-owned life insurance (BOLI) and was used to provide an additional benefit to Mr. Dakey during his employment. Split-dollar life insurance plans are widely availableplaced on disability leave (as defined in the banking industry, becauseagreement), he shall receive 100%

of his then salary for ninety days and shall receive 60% of his then salary for up to a maximum of $10,000 per month thereafter until the bank will recover its plan costs uponearlier of his return to work, his death or the deathexpiration of the executive, andagreement pursuant to its terms. Notwithstanding the executive’s beneficiaryforegoing, such term shall not be longer than twenty-nine months. During his disability leave, Mr. Ritrievi will receive a splitall other benefits due under the agreement. If he dies, the agreement and all benefits under it automatically terminate at the close of the insurance proceeds. Although this benefit does not provide any current remuneration tocalendar week in which his death occurs. Upon termination by the executive, it provided the bank with a mechanism to use to attract, retain and reward highly qualified executives, and it also provided incentiveBank of Mr. Ritrievi’s employment, other than for longevity with the bank.

Salary Continuation Agreement

The bank provided a salary continuation agreement to Mr. Dakey only. The agreement was designed to account for somecause or upon notice of termination of the limitations with traditional pension plansagreement, the Corporation shall pay Mr. Ritrievi his full base salary through the date of termination and an amount equal to encouragetwo times his annual base salary for the previous twenty-four months paid in two lump sums over a one-year period, which is subject to an excise tax reduction, and one year of benefits. Additionally, if Mr. Dakey to remain an employee of the bank through retirement. Pursuant toRitrievi terminates his severance agreement, he has become 50% vested. Salary continuation agreements are typicalemployment following a change in control or for good reason (as defined in the financial services industry,agreement), the Bank shall pay Mr. Ritrievi his full base salary through the date of termination and an amount equal to two times his annual base salary for the amount payable under the agreementprevious twenty-four months paid in two lump sums over a one-year period, which is also consistent with whatsubject to an excise tax reduction, and one year of benefits. Mr. Ritrievi is expected in the financial services industry.

Executive Deferred Compensation Agreementsubject to customary non-competition, non-solicitation and Executive Deferred Bonus Agreementconfidentiality provisions.

In an effort to offer Mr. Dakey an additional method of saving for retirement and to account for some of the limitations with traditional pension plans, the bank maintains a non-qualified deferred compensation plan in which he was eligible to participate. The plan was designed to encourage Mr. Dakey to remain an employee of the bank by allowing him to defer a portion of his income to be paid out in the event of retirement, early termination, disability, a change of control or death. Interest is credited semi-annually at 2% above the 5-year Treasury rate.

Executive Agreements

On September 1, 2007, Mid Penn Bank entered into an Executive Employment Agreement with Alan W. Dakey, former Chairman, President and Chief Executive Officer. The bank was aware that Executive Employment Agreements are common in the banking industry for chief executive officers. Mr. Dakey’s executive employment agreement contained standard terms and conditions compared to employment agreements in place for chief executive officers of comparable Pennsylvania banks of similar size. Upon resignation, Mr. Dakey negotiated a severance agreement with Mid Penn Bank whereby he was paid under the Employment Agreement as if he were terminated without cause. The Bank agreed to the severance agreement in exchange for a release from Mr. Dakey.

On April 1, 2008, the corporationCorporation entered into a change of control agreement with Kevin Laudenslager, the bank’s chief financial officer.Laudenslager. Under the agreement, Mr. Laudenslager will receive a lump-sum payment equal to two times his base salary if he is terminated after a change of control or if he terminates employment for good reason, as defined in the agreement, after a change in control. The Compensation Committee believed that it was appropriate to enter into the agreement with Mr. Laudenslager because he hasof his substantial knowledge, ability and experience, which are beneficial to the successful operation of the corporation.Corporation. Additionally, by entering into the agreement, the corporationCorporation is giving Mr. Laudenslager the security of knowing that he will receive compensation if he is terminated or terminates for good reason after a change in control during the time of his transition from the corporationCorporation to another company. In exchange for receiving the change in control, Mr. Laudenslager has agreed to noncompetitionnon-competition provisions restricting his working for a competitor after a change in control, soliciting clients and employees.

The Corporation was subject to Troubled Asset Relief Program (“TARP”) during 2009, including on December 31, 2009. TARP prohibits the payment of certain amounts deemed to be bonuses or “golden parachutes.” TARP defines the term “golden parachute payment” to mean any payment for the departure for any reason, or any payment due to a change in control, except for payment for services performed or benefits accrued. A golden parachute payment includes the acceleration of vesting due to the departure or the change in control event, as applicable. A golden parachute payment does not include payments made (i) pursuant to a qualified pension or retirement plan, (ii) due to the employee’s death or disability, or (iii) severance required to be made pursuant to a state statute. Accordingly, the Corporation is prohibited from making certain of the payments described above because of its participation in TARP.

Triggering Events in Contracts

The triggering events contained in Mr. Dakey’s Employment Agreement wereRitrievi’s employment agreement are termination without cause, termination after a change of control and termination for good reason. The triggering events in Mr. Laudenslager’s change of control agreement are a termination without cause or a termination for good reason after a change of control. The Compensation Committee wanted to provide Mr. DakeyMessrs. Ritrievi and Mr. Laudenslager with the security of knowing that if he is terminated in one of those scenarios, he would receive some form of compensation during the transition phase from working for the corporationCorporation/Bank to finding another position. The Compensation Committee believes that the triggering events in these agreements are appropriate in that they encouraged Mr. Dakeyencourage Messrs. Ritrievi and Mr. Laudenslager to act in the best interests of the shareholders in evaluating any change of control opportunities and keptkeep them focused on running the corporationCorporation in the face of real or rumored corporate transactions. In addition, each contract contains a non-competition provision, whereby the executive is not allowed to compete with the corporationCorporation or solicit customers of the corporationCorporation for a specific period of time.

Material Differences in Named Executive Officers’ Compensation

The Compensation Committee determined the amount and type of compensation to be awardedthat is paid to the named executive officers based on the salary and benefit survey information provided by the compensation consultant. The Compensation Committee considers the salary ranges for the particular positions and has maintained executive salaries in the salary ranges for these executive positions. The Compensation Committee considers the performance of each named executive as another consideration in determining annual base salary increases. There were no material differences in the percentage of salary adjustments among the named executive officers. The differential between salary levels for each of the named executives is primarily driven by salary differentials in the salary survey with consideration also given to the experience and time in their respective positions.

Accounting and Tax Treatments

There were no decisions or changes made to compensation or benefit plans as a result of accounting and/or tax treatments. As part of the TARP requirements, as further discussed below, the bankBank agreed that it will not take a deduction for any compensation paid in excess of $500,000 to any named executive officer which would not be deductible if Internal Revenue Code Section 162(m)(5) applied to the bank.Bank. The bank’sBank’s compensation levels are less than $500,000; therefore, this agreement does not affect the named executive officers’ levels of compensation.

Equity Compensation Plans

The corporationCorporation does not currently maintain any equity compensation plans or stock options for executives or boardBoard members. The Board has determined that stock options areat this time equity compensation is not consistent with the corporation’sCorporation’s philosophy and approach to compensation. Cash compensation is deemed the more appropriate form of payment.

TARP Requirements

In December 2008, Mr. Laudenslager’s change of control agreement, the only executive compensation agreement with a named executive officer in place as of December 2008, was amended to provide for a gross-down provision in the event that the payments under the change in control agreement were considered parachute payments under the Internal Revenue Code. This change was a requirement of the Interim Final Rule promulgated pursuant to the Emergency Economic Stabilization Act of 2008 (“EESA”).

Additionally, the Compensation Committee met with the senior risk officerSenior Risk Officer to identify those incentives for executives that may cause the executives to take unnecessary and excessive risks that threaten the value of the bank.Bank. There were none. The Compensation Committee also discussed and reviewed the relationship between the bank’s risk managementBank’s policies and practices and the named executive officers’ compensation arrangements.

The executive compensation for named executive officers does not encourage excessive and unnecessary risk taking as the majority of compensation is in the form of base salary. The bank’sBank’s compensation programs do not encourage executives to take excessive and unnecessary risks as their compensation is not directly tied to specific corporationCorporation performance metrics with the exception of the formulizedmetrics.

The Bank’s bonus plan which is based upon the bank’s performance compared to its peers and the Commercial Lender’s Incentive Plan which contains mechanisms for reducing bonus payments based upon a qualitative assessment of the loans.

The bank’s bonus plans werewas amended in February 2009 to comply with the clawback provisions mandated in The American Recovery and Reinvestment Act, which requires a provision in the plan for the recovery by the bankBank of any bonus or incentive compensation paid to a named executive officer and any of the next 20 most highly compensated employees based on statements of earnings, gains, or other criteria that are later proven to be materially inaccurate. The named executive officers also signed an omnibus agreement agreeing to have their compensation limited by the mandates contained in The American Recovery and Reinvestment Act, if applicable. The Bank’s bonus plan has since been eliminated.

COMPENSATION COMMITTEE REPORT

The Compensation Committee has reviewed and discussed the Compensation Discussion and Analysis with management, and based on the review and discussions, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in the corporation’sCorporation’s proxy statement.

The Compensation Committee certifiesBank currently offers an employment agreement for its Chief Executive Officer, and the Corporation offers a change of control agreement for its Chief Financial Officer. It was determined that it has reviewed with senior risk officerafter review of each of the senior executive officers’ incentive compensation arrangements and has made reasonable efforts to ensureabove agreements that such arrangements do notneither of them encourage seniorthe named executive officers to take unnecessary and excessive risks that threaten the value of the financial institution.Corporation or the Bank. In this regard, both the employment agreement and the change of control agreement provide for severance payments if a termination of employment occurs under certain circumstances. As discussed under “Compensation Discussion and Analysis,” due to the Corporation’s participation in the Troubled Asset Relief Program (“TARP”) Capital Purchase Program, neither the Chief Executive Officer or Chief Financial Officer are able to receive any severance payments if the respective employments are terminated for reasons specified in the

respective agreements before the preferred stock issued to the U.S. Department of the Treasury pursuant to the TARP Capital Purchase Program is redeemed. Additionally, the Corporation and the Bank are unable to pay any cash bonus or grant any new stock options to its most highly compensated employee due to restrictions imposed on TARP Capital Purchase Program participants. Other than the Employee Referral Incentive Program, the Corporation and the Bank do not offer any employee compensation arrangements that provide for variable cash bonus compensation, commission or incentive payments. The Compensation Committee reviewed the terms, structure and implementation of the Employee Referral Incentive Program. The Compensation Committee determined that such arrangement does not encourage unnecessary and excessive risks that threaten the value of the Corporation or the Bank or the manipulation of reported earnings to enhance the compensation of any employee.

The Compensation Committee certifies that:

(1) It has reviewed with the Senior Risk Officer the senior executive officer (“SEO”) compensation plans and has made all reasonable efforts to ensure that these plans do not encourage SEOs to take unnecessary and excessive risks that threaten the value of the Corporation;

(2) It has reviewed with the Senior Risk Officer the employee compensation plans and has made all reasonable efforts to limit any unnecessary risks these plans pose to the Corporation; and

(3) It has reviewed the employee compensation plans to eliminate any features of these plans that would encourage the manipulation of reported earnings of the Corporation to enhance the compensation of any employee.

Compensation Committee

COMPENSATION COMMITTEE INTERLOCKS

AND INSIDER PARTICIPATION

Mr. Alan W. Dakey,The Corporation has no Compensation Committee interlocks. Messrs. Mowery, Coxon, DeSoto, Grubic, Sauve and Specht constitute all of the directors who served on the Compensation Committee at any time during 2009. Each of them is an independent outside director. None of them is a current or former officer or employee of the Corporation. During 2009, the Bank engaged in customary banking transactions and had outstanding loans to certain of its directors, executive officers, members of the immediate families of certain directors and executive officers, and their associates. These loans were made in the ordinary course of business and were made on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions with persons not related to the lender. In the opinion of management, these loans do not involve more than normal risk of collectability

or present other unfavorable features. Edwin D. Schlegel, Chairman of the Board, and Rory G. Ritrievi, President and Chief Executive Officer of the corporation,Corporation, attended Compensation Committee meetings only when and to the extent requested by the committee. HeCommittee. Mr. Ritrievi did not participate in determining his own compensation.

EXECUTIVE COMPENSATION

The following discussion provides details of the various components of executive compensation.

Summary Compensation Table

The following table summarizes the total compensation awarded or earned for services in all capacities to the corporation andCorporation or the bankBank for the fiscal years ended December 31, 2009, December 31, 2008, and December  31, 2007, and December 31, 2006 for Edwin D. Schlegel, Chairman of the Board, Interim President and Chief Executive Officer; Alan W. Dakey, former Chairman of the Board, President and Chief Executive Officer; Kevin W. Laudenslager, Senior Executive Vice President and Northern Region President/Chief Operating Officer and Chief Financial Officer; and Eric S. Williams, Executive Vice President and Chief Lending Officer.

SUMMARY COMPENSATION TABLE

Mr. Williams earned $400 as a perfect attendance bonus in 2008. He earned a perfect attendance bonus of $400 and a business referral incentive of $10 in 2007. These amounts were previously reported in “All Other Compensation.” Mr. Williams also earned $21,299 under the Lender Incentive Program for 2008 which was paid in 2009.

Bonus

In 2008, the bank created a formulized bonus plan. A three percent bonus will be paid to eligible employees for attaining the peer group average in two elements: Earnings per Share (EPS) growth and Core Deposit Growth. Additionally, a six percent bonus will be paid out for attaining five percent growth above the peer group averages with regard to these same two elements.

Commercial Lender’s Incentive PlanPENSION BENEFITS – 2009

In 2008,As described under the Bank continued its Commercial Lender’s Incentive Plan. The Rate of Distribution for eligible employees is calculated based on both Quantitative and Qualitative Performance Measures. The Quantitative Measures consistcaption “Compensation of the commercial lending group’s performance relative to goals in three areas: loans originated, loans outstanding and fee income. The Qualitative Performance Measures include delinquencies, line renewals, document exceptions and charge-offs.

Mid PennBoard,” the Bank Retirement Plan/401(k) Plan

The corporation does not maintain a defined benefit pension plan. The bank, however, maintains the Mid Penn Bank Director Retirement Plan created in 1949, restated in 1994, and last amended in 2007, which covers all bank employees who meet eligibility requirements. The Board of Directors institutedfor its directors. As a 401(k) Plan as part of the Retirement Plan effective January 1, 2007 for all bank employees who satisfy eligibility requirements. Eligible employees are entitled to receive a share of the bank’s contribution to the plan if they are bank employees on December 31st. For the year 2008, the Board approved a matching contribution rate of 50% of the employee contribution, up to a maximum bank contribution of 3%. The Board maintains the right to adjust its matching rate on an annual basis.

The annual contribution to the Retirement Plan is determined by the bank’s Board of Directors based on the recommendation of the Compensation Committee. The contributions to the Retirement Plan are paid to a trust fund that is administered by the bank’s Trust Department. A participating employee is allocated a share of the net income of the trust fund and the increase or decrease in the fair market value of its assets on the basis of such employee’s beginning of the plan year account balance, plus forfeitures of unvested balances from employees who terminated employment, less any payments as compared to the total beginning account balances, less payments to all the participating employees. A notice of the account balance is given to participating employees annually.

Distributions under the plan can be made to participating employees upon retirement, either normal or early retirement as defined in the plan, at death or disability of the participating employee or upon severing employment if either partially or fully vested. The plan provides for percentage vesting of 20% for the first full two years of service increasing annually thereafter to 100% vesting after six full years of participation. The plan provides for an accelerated vesting schedule in the event it becomes top-heavy.

Management cannot determine the extent of the benefits that any participating employee may be entitled to receive under the plan on the date of termination of employment because the amount of the benefits is dependent, among other things, upon the bank’s future earnings, the participants’ future compensation and the future earnings of the plan’s trust fund. As of December 31, 2008, the total market value of the Employee Profit Sharing Retirement Fund was approximately $3,891,776, which does not include the 401(k) Plan. As of December 31, 2008, there were no shares of Mid Penn Bancorp, Inc. common stock in the plan.

Contributions the bank paid to the plan were $270,522 for 2008, including the employer match for the 401(k) Plan. The bank contributed $5,569 in 2008 to the plan for Mr. Dakey,

former Chairman of the Board, President and Chief Executive Officer of the corporation and the bank; $4,359 for Mr. Laudenslager, Senior Executive Vice President and Northern Region President/Chief Operating Officer and Chief Financial Officer of the bank; and $4,810 for Mr. Williams, Executive Vice President and Chief Lending Officer of the bank. In addition, the bank made matching contributions to the 401(k) Plan in 2008 of $5,569 for Mr. Dakey, $3,270 for Mr. Laudenslager and $3,608 for Mr. Williams. As of February 17, 2009, Mr. Dakey had 16 years of credited service under the plan. Mr. Laudenslager and Mr. Williams had 24 and 8 years of credited service under the plan, respectively.

Employee Stock Ownership Plan

Effective January 1, 1998, the Board of Directors adopted the Mid Penn Bank Employee Stock Ownership Plan for all bank employees and its subsidiaries who satisfy length of service requirements. The Plan was last amended in 2007. Participants do not contribute to the plan. The Plan invests in shares of Mid Penn Bancorp, Inc. stock, holding 47,995 shares as of December 31, 2008. Each year the bank may, in its discretion, contribute to the ESOP. In 2008, the bank contributed $85,751 to the plan. As of December 31, 2008, the total market value of the Employee Stock Ownership Plan was approximately $1,093,581. In 2008, the bank contributed $2,180 for Mr. Laudenslager, Senior Executive Vice President and Northern Region President/Chief Operating Officer and Chief Financial Officer of the bank and $2,405 for Mr. Williams, Executive Vice President and Chief Lending Officer of the bank.

Executive Deferred Compensation Agreement and Executive Deferred Bonus Agreement

Under the executive deferred compensation agreement and executive deferred bonus agreement, Mr. Dakey deferred specified amounts of compensation and bonuses. The amounts deferred under the agreements accrue an annual rate of interest equal to the five year Treasury rate as of the last day of the preceding calendar year plus 2%.

The following tables summarize certain information concerning Mr. Dakey’s participation in the Executive Deferred Compensation Plan and Director Deferred Fee Plan for the 2008 fiscal year.

NONQUALIFIED DEFERRED COMPENSATION TABLE

PENSION BENEFITS TABLE

Salary Continuation Plan

To encourage Mr. Dakey to remain an employeedirector of Mid Penn Bank, the bank entered into an agreement effective January 1, 1999, to provide salary continuation benefits. The benefit is to be paid in monthly installments over a term of 15 years to Mr. Dakey or his beneficiary. Mr. Dakey’s early termination benefitSchlegel participates in the Director Retirement Plan. No other named executive officer currently participates in the Director Retirement Plan.

NONQUALIFIED DEFERRED COMPENSATION – 2009

As described under the caption “Compensation of the Board,” directors are permitted annually to elect to defer receipt of up to $8,000 in directors’ fees. As a director of Mid Penn Bank, Mr. Schlegel has elected to defer certain of his fees under this arrangement. No other named executive officer is eligible to participate in a deferred compensation plan was $27,387 per annum.(other than the qualified retirement plans, which are generally available to all employees) in connection with his employment.

POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE OF CONTROL

The corporation hasIt was determined that the appropriate triggering events for payments under certain plans are retirement, early retirement, disability, change of control and death. These triggers are standard in the financial industry and are appropriate to accomplish the corporation’s intent of providing an incentive for longevity. None of the named executive officers will be able to collect any post-termination payments while the Corporation’s preferred stock issued under the Troubled Asset Relief Program remains outstanding.

The following agreements contain changeBank may terminate Mr. Ritrievi’s employment for “cause” (as defined in the agreement) upon thirty days written notice, and all rights and benefits under this agreement shall terminate upon the termination date. If Mr. Ritrievi is placed on disability leave (as defined in the agreement), he receives 100% of control or early termination provisionshis then salary for Mr. Dakeyninety days and Mr. Laudenslager.

Officer Split Dollar Life Insurance Plan

In order to attract, retain and reward highly qualified executives, the bank purchased certain life insurance policies60% of his then salary for certain executives. Effective January 1, 1999, the bank entered into an agreement to provide Mr. Dakey with life insurance coverage equal to three times his base salary up to a maximum of $600,000. In 2001,$10,000 per month thereafter until the bank purchased bank-owned life insuranceearlier of his return to fundwork, his death or the premiumsexpiration of the Officer’s Split Dollar Life Insurance Plan. Pursuantagreement pursuant to its terms, not to exceed twenty-nine months. During his Severance Agreement,disability leave, Mr. Dakey has vested insurance benefit in the policies.

Director Deferred Fee Agreement

Upon early retirement, Mr. Dakey became entitled to a lump sum payment in the amount of his deferral account balance.

Executive Deferred Compensation Agreement and Executive Deferred Bonus Agreement

Upon early termination, Mr. Dakey became entitled to monthly payments over a specified time period totaling the amount of his deferral account balance. Under the pre-termination death benefit, the beneficiaryRitrievi will receive 120 equal monthly installment payments. Underall other benefits due under the post-termination death benefit, the beneficiary will receive the remaining installment payments.agreement.

Salary Continuation Agreement

If he dies, the agreement and all benefits under it automatically terminate at the close of the calendar week in which his death occurs. Upon early termination Mr. Dakey receives a specific annual amount determined by the natureCorporation of Mr. Ritrievi’s employment other than for cause or upon notice of termination of the triggering event andagreement, the number of years of service.

Severance Agreement

On November 26, 2008,Corporation is required to pay Mr. Dakey and the bank entered into a Severance Agreement, whereby Mr. Dakey agreed to release the bank from all claims and rights including but not limited to those arising fromRitrievi his termination of employment in exchange for twenty-four months of compensation, maintaining in full force all group medical, life insurance and health and accident plans provided to him prior to his resignation, and paying the benefits under his split dollar life insurance plan, amended and restatedbase salary continuation agreement, amended and restated executive deferral compensation agreement, survivor income agreement, director retirement plan, amended and restated director deferral fee agreement, ESOP, profit sharing retirement plan, and deferred bonus agreement as if he were terminated without cause.

The following table shows the payments upon termination for Mr. Dakey under his Split Dollar Life Insurance Plan, Director Deferred Fee Agreement, Executive Deferred Compensation Agreement and Executive Deferred Bonus Agreement, Salary Continuation Agreement, and Director Retirement Plan and Survivor Income Agreement and Severance Agreement, pursuant to his Severance Agreement. The chart assumes the triggering events took place on November 26, 2008,through the date of termination and an amount equal to two times his annual base salary for the agreement.

Under the bank’s group life insurance plan, asprevious twenty-four months paid in two lump sums over a one-year period, which is subject to an excise tax reduction, and one year of December 31, 2008, upon death, Kevin W. Laudenslager’s beneficiary would receive $321,000,benefits. Additionally, if Mr. Ritrievi terminates his employment following a change in control or for good reason (as defined in the caseagreement), the Bank is required to pay Mr. Ritrievi his full base salary through the date of accidental death, $642,000. termination and an amount equal to two times his annual base salary for the previous twenty-four months paid in two lump sums over a one-year period, which is subject to an excise tax reduction, and one year of benefits.

Upon a termination after a change in control without cause or for good reason, Mr. Laudenslager willwould receive two times his annual salary. As

On September 3, 2009, Mr. Williams received a payment of $20,000 relating to his termination of employment, in exchange for a release.

The following table sets forth certain information with respect to severance benefits under an employment agreement or change in control agreement with a named executive officer based on compensation received for the year ended December 31, 2008, this payment would be $217,966. He will also be entitled to benefits for twelve months, which have a value of $5,150.2009:

										Absent Change in Control						After Change in Control
		Disability								Involuntary Termination without Cause (1)			Voluntary Termination for Good Reason			Involuntary Termination without Cause (1)			Voluntary Termination for Good Reason (2)
Rory G. Ritrievi (6)
Severance (3)		$	0		to		$	204,187		$	527,819		$	527,819		$	527,819		$	527,819
Medical continuation (4)		$	0		to		$	11,271		$	9,755		$	9,755		$	9,755		$	9,755
Value of accelerated stock options (5)							$	0		$	0		$	0		$	0		$	0
Value of accelerated restricted stock (5)							$	0		$	0		$	0		$	0		$	0
Potential reduction in payout due to operation of Code Section 280G							$	0		$	0		$	0		$	0		$	0
Total		$	0		to		$	215,458		$	537,574		$	537,574		$	537,574		$	537,574
Kevin W. Laudenslager (6)
Severance (3)							$	0		$	0		$	0		$	213,852		$	213,852
Medical continuation (4)							$	0		$	0		$	0		$	6,635		$	6,635
Value of accelerated stock options (5)							$	0		$	0		$	0		$	0		$	0
Value of accelerated restricted stock (5)							$	0		$	0		$	0		$	0		$	0
Total							$	0		$	0		$	0		$	220,487		$	220,487

Eric S. Williams’ beneficiary would receive $360,000, or in the case of accidental death, $720,000. Mr. Williams would not be entitled to receive any other compensation under any other scenarios.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Neither the corporationCorporation nor the bankBank have entered into any material transactions, proposed or consummated, with any other director or executive officer of Mid Penn Bancorp, Inc.the Corporation or Mid Pennthe Bank, or any associate of the foregoing persons. From time to time, the bankBank has engaged in and intends to continue to engage in banking and financial transactions in the ordinary course of business with directors and officers and their associates on comparable terms with similar interest rates as those prevailing from time to time for other customers.

Related party transactions greater than $10,000 must be approved by the Board of Directors prior to any commitment by the bankBank to any such transaction. Directors do not participate in the discussions and are not present for voting on their own related party transactions. All of the material terms, conditions and purpose of the transaction shall be described in writing and provided to the Board, of Directors, together with the written request for approval of any such related party transaction. The transaction should be reviewed and approved by the appropriate senior officer before being submitted to the Board for approval. Related party transactions for ongoing or continuing services can be reviewed and pre-approved within reasonable parameters by the Board of Directors on an as-needed basis. If the terms, pricing or conditions change so as to go outside the specified parameters cited in the request, the transactions shall be resubmitted for review and approval after the fact.

The bank makesBank has made loans to the corporation’sCorporation’s and the bank’sBank’s officers and directors and their immediate families and companies in which they had an ownership interest of 10% or more duringmore. Loans to such persons were made in the ordinary course of business, were made on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactionsloans with other persons. The loanspersons not related to the lender, and did not involve more than the normal risk of collectioncollectability or present other unfavorable features.

BENEFICIAL OWNERSHIP OF

MID PENN BANCORP’S STOCK HELD BY

HELD BY PRINCIPAL SHAREHOLDERS AND MANAGEMENT

Principal Shareholders

The following table shows, to the best of ourthe Corporation’s knowledge, those persons or entities, who owned of record or beneficially, on February 17, 2009,16, 2010, more than 5% of the outstanding shares of Mid Penn Bancorp’sthe Corporation’s common stock.

Beneficial ownership of Mid Penn Bancorp’sthe Corporation’s common stock was determined by referring to Securities and Exchange Commission Rule 13d-3, which provides that a person should be credited with the ownership of any stock held, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise has or shares:

Share Ownership by the Directors, Officers and Nominees

The following table shows, as of February 17, 2009,March 12, 2010, the amount and percentage of Mid Penn Bancorp’sthe Corporation’s common stock beneficially owned by each director, each nominee, each named executive officer and all directors, nominees and executive officers of the corporationCorporation as a group.

Beneficial ownership of shares of Mid Penn Bancorp’sthe Corporation’s common stock is determined in accordance with Securities and Exchange Commission Rule 13d-3, which provides that a person should be credited with the ownership of any stock held, directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise has or shares:

Unless otherwise indicated in a footnote appearing below the table, all shares reported in the table below are owned directly by the reporting person. The number of shares owned by the directors, nominees and executive officers is rounded to the nearest whole share.

PROPOSAL NO. 2: AMENDMENT OF THE ARTICLES OF INCORPORATION

Background

Article 7 of Mid Penn Bancorp, Inc.’s Amended and Restated Articles of Incorporation, as amended, currently provides that no merger, consolidation, liquidation or dissolution of the corporation, nor any action that would result in the sale or other disposition of all or substantially all of the assets of the corporation, shall be valid unless first approved by the affirmative vote of: the holders of at least eighty percent (80%) of the outstanding shares of common stock of the corporation; or the holders of at least sixty-six and two-thirds percent (66 ²/3%) of the outstanding shares of common stock of the Corporation, provided that such transaction has received the prior approval of at least eighty percent (80%) of all of the members of the Board of Directors.

The Board of Directors believes that the supermajority shareholder vote requirements of Article 7 should not apply to a merger in which the corporation is the surviving entity if the transaction has received the prior approval of at least 80% of the members of the Board of Directors. Eliminating the supermajority shareholder vote requirement in such a situation could improve flexibility and reduce inefficiencies and costs of such a transaction. Therefore, the Board of Directors is proposing that a new final sentence be added to Article 7 to exclude from Article 7’s requirements a merger in which the corporation is the surviving entity if the transaction has received the prior approval of at least 80% of the members of the Board of Directors. The proposed amendment does not eliminate an 80% shareholder vote requirement for a merger in which the corporation is the surviving entity if the transaction does not receive the prior approval of 80% of the members of the Board of Directors.

If the proposed amendment is approved, a merger in which the corporation is the surviving entity in a transaction receiving the prior approval of at least 80% of the members of the Board of Directors will require shareholder approval only when required by applicable law. Applicable Pennsylvania law does not require shareholder approval of all mergers in which a corporation is the surviving corporation. When applicable Pennsylvania law does require approval of a merger by a surviving corporation’s shareholders, the general standard for approval is a majority of the votes cast by all shareholders entitled to vote on the transaction.

Resolution

Accordingly, the Board of Directors has approved and is submitting for approval and adoption by the shareholders the following resolution:

“Resolved, that Article 7 of the Amended and Restated Articles of Incorporation be further amended and restated in its entirety to read as follows: