Company: NWFL
Filing Date: 2025-10-28
Form Type: 424B3
Source: 0001193125-25-252482
Chunk: 343

Company: NORWOOD FINANCIAL CORP
Filing Date: 2025-10-28
Form: 424B3
Chunk 343
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 be taken all such actions as may be necessary to effect the actions set forth below relating to the Presence Bank Employee Stock Ownership Plan (“ESOP”) not later than with a plan termination date effective on the
day immediately prior to the Effective Time of the Merger (the “ESOP Termination Date”). No new participants shall be admitted on or after the ESOP Termination Date and all existing ESOP participants’ accounts shall become fully
vested and 100% non-forfeitable. Presence Bank shall direct the ESOP trustee to remit a sufficient number of the shares of Bankshares Common Stock allocated to the suspense account pursuant to the ESOP (the
“Suspense Shares”) back to Bankshares to repay the outstanding ESOP loan which promissory note is held by Bankshares in full, with each remitted share to be valued equal to the closing price of Bankshares Common Stock on the day
immediately prior to the ESOP Termination Date. All remaining shares of Bankshares Common Stock held by the ESOP as of the Effective Time of the Merger shall be exchanged for the Merger Consideration as elected by the ESOP trustee. After repayment
of the outstanding ESOP loan and the exchange of the balance of ESOP Bankshares Common Stock for the Merger Consideration, the Merger Consideration received upon conversion of the remaining Suspense Shares shall be deemed to be earnings and shall be
allocated as earnings to the accounts of the ESOP participants who are employed as of the ESOP Termination Date based on their account balances under the ESOP as of the ESOP Termination Date and distributed to ESOP participants after the receipt of
a favorable determination letter from the IRS. No benefit distributions shall be made from the ESOP without the prior written consent of Norwood before the IRS issues a favorable determination letter with respect to the tax-qualified status of the ESOP on termination. Bankshares shall use its best efforts, prior to the Effective Time of the Merger, to take all such actions as are necessary (determined in consultation with Norwood)
to prepare and

A-51

file the application for a favorable determination letter for the ESOP with the IRS, and following the Closing, Norwood shall use its best efforts in good faith to obtain such favorable
determination letter as promptly as possible (including, but not limited to, making such changes to the ESOP as may be required by the IRS as a condition to its issuance of a favorable determination letter). Bankshares and Presence Bank