On September 22, 2023, Meridian Corporation entered into a Subordinated Note Purchase Agreement with accredited investors under which the Company issued an aggregate of $9,740,000 of fixed rate subordinated notes due September 22, 2033 in a private placement. The Subordinated Notes bear interest at a fixed annual rate of 8.00%, payable semi-annually in arrears on February 15th and August 15th of each year, beginning February 15, 2024. The Subordinated Notes?

maturity date is September 22, 2033. The Company is entitled to redeem the Subordinated Notes, in whole or in part, on or after August 15, 2028, and to redeem the Subordinated Notes at any time in whole upon certain other events, at a redemption price equal to 100% of the outstanding principal amount of the Subordinated Notes to be redeemed plus any accrued and unpaid interest to, but excluding, the redemption date. If certain events of default occur, such as the bankruptcy of the Company, then the principal amount of all of the outstanding Subordinated Notes will become and be immediately due and payable without any declaration of other act on the part of the Holder.

There is no right of acceleration in the case of a default under the Agreement or the Subordinated Notes. The Subordinated Notes are unsecured obligations subordinate and junior in right of payment to all of the Company?s existing and future senior indebtedness, whether secured or unsecured, including claims of depositors and general creditors, and rank equally in right of payment with any unsecured, subordinated indebtedness that is existing or the Company may incur in the future that rank equally with the Subordinated Notes. The Company expects to use the net proceeds from the sale of the Subordinated Notes for general corporate purposes, including providing capital to Meridian Bank and supporting organic growth.

The Subordinated Notes were offered and sold in reliance on the exemptions from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended, and Rule 506(b) of Regulation D promulgated thereunder. Accordingly, the Subordinated Notes were offered and sold exclusively to persons who are ?accredited investors? within the meaning of Rule 501(a) of Regulation D.