2017 ANNUAL REVIEW SHAREHOLDER INFORMATION Annual Meeting The 2018 Annual Meeting of Shareholders for ACNB Corporation will be held on Tuesday, May 1, at 1:00 p.m. at the ACNB Corporation Operations Center, 100 V-Twin Drive, Gettysburg, PA. All proxy and other materials for the Annual Meeting are available at acnb.com/acnb-corporation. Stock Listing ACNB Corporation common stock is listed and traded on The NASDAQ Capital Market under the symbol ACNB. Annual Report on Form 10-K A copy of ACNB Corporation’s Annual Report on Form 10-K, as filed with the Securities and Exchange Commission, may be obtained, without charge, by contacting: Lynda L. Glass Executive Vice President/ Secretary & Chief Governance Officer ACNB Corporation P.O. Box 3129 Gettysburg, PA 17325 717.339.5085 The Annual Report and other Corporation reports are also filed electronically with the Securities and Exchange Commission and are accessible by the public on the Internet at www.sec.gov/edgar.shtml. Transfer Agent, Registrar and Dividend Disbursing Agent Computershare Shareholder Services P.O. Box 505000 Louisville, KY 40233-5000 www.computershare.com/investor For shareholder inquiries or information regarding the ACNB Corporation Dividend Reinvestment and Stock Purchase Plan, call Computershare toll free at 1.800.368.5948. BUSINESS PROFILE & GEOGRAPHY ACNB Corporation, headquartered in Gettysburg, PA, is the financial holding company for the wholly-owned subsidiaries of ACNB Bank, Gettysburg, PA, and Russell Insurance Group, Inc., Westminster, MD. Originally founded in 1857, ACNB Bank serves its marketplace with banking and wealth management services, including trust and retail brokerage, via a network of 22 community banking offices located in the four southcentral Pennsylvania counties of Adams, Cumberland, Franklin and York. In addition, NWSB Bank, a division of ACNB Bank, serves its marketplace via a network of seven community banking offices located in Carroll County, MD. Russell Insurance Group, Inc., the insurance subsidiary of ACNB Corporation, offers a broad range of commercial and personal insurance lines through licenses in 44 states. The full-service insurance agency has office locations in Westminster, Carroll County, MD, and Germantown, Montgomery County, MD. One ACNB Bank Location in Cumberland County Two ACNB Bank Locations in Franklin County Cumberland County Newville Dillsburg Franklin County Chambersburg York County York Hanover Adams County Gettysburg Taneytown Six ACNB Bank Locations in York County Including the York Loan Office Pennsylvania Fourteen ACNB Bank Locations Throughout Adams County Maryland Westminster New Windsor Carroll County Germantown Montgomery County Seven NWSB Bank Locations in Carroll County Two Office Locations for Russell Insurance Group, Inc. 1 2017 ANNUAL REVIEW REPORT TO SHAREHOLDERS The ACNB Corporation logo was introduced in 1987. After thirty years, it still stands for the fundamental organizational strengths of commitment, independence and community. In 2017, and as we enter 2018, the logo symbol now identifies new brands associated with growth and change at ACNB Corporation — all focused on the vision to be the independent financial services provider of choice in the core markets served by building relationships and finding solutions. Significant 2017 Accomplishments 2017 Financial Performance The two primary challenges for ACNB Corporation in 2017 were closely intertwined. Both the executive management leadership transition and the acquisition and integration of New Windsor Bancorp, Inc. and New Windsor State Bank were accomplished successfully. On May 5, 2017, Thomas A. Ritter retired with James P. Helt succeeding him as President & Chief Executive Officer of ACNB Corporation and Chief Executive Officer of ACNB Bank. This planned transition in leadership began with the promotion of Mr. Helt to President of ACNB Bank effective September 1, 2015, and continued with the announcement of Mr. Ritter’s retirement on January 26, 2017. Effective July 1, 2017, ACNB Corporation and its community banking subsidiary, ACNB Bank, completed the acquisition of New Windsor Bancorp, Inc. of Taneytown, Maryland, and its wholly-owned subsidiary, New Windsor State Bank. This merger transaction across the Mason-Dixon Line was announced on November 21, 2016. The acquisition resulted in strategic market expansion for ACNB Bank into the desirable northern Maryland market of Carroll County adjacent to the Bank’s Pennsylvania footprint and in proximity to the Corporation’s other wholly- owned subsidiary, Russell Insurance Group, Inc. ACNB Bank now operates in the Maryland market branded as NWSB Bank, A Division of ACNB Bank, with systems conversions completed in July 2017 so that all ACNB Bank customers can conduct business at any of the 29 community banking offices in Pennsylvania and Maryland. These two significant accomplishments were only achieved due to the fortitude and determination of those key individuals providing the necessary support to advance the many action steps in a merger transaction, while simultaneously adapting during the management succession process. ACNB Corporation recorded net income of $9,788,000, or $1.50 earnings per share, for the year ended December 31, 2017. This amount is a decrease from 2016 due to the one-time impacts of the expenses associated with the acquisition of New Windsor Bancorp, Inc. and the enactment of the Tax Cuts and Jobs Act on December 22, 2017. Without these nonrecurring items, net income for the year ended December 31, 2017, would have been $14,498,000, or $2.22 earnings per share, which represents a 30% increase over the results for the year ended December 31, 2016. The nonrecurring expenses associated with the acquisition and integration of New Windsor Bancorp, Inc. incurred during 2017 amounted to $3,010,000, net of the corresponding tax impact at the marginal tax rate. The second nonrecurring event that caused additional expense in 2017, but that will produce a subsequent immediate positive net income effect, was the Tax Cuts and Jobs Act. As a result of this comprehensive federal tax reform legislation which impacted many in the financial services industry, the Corporation’s federal statutory corporate tax rate is reduced from 35% to 21% effective with the 2018 tax year; however, accounting standards required recognition in the form of a write-down in the Corporation’s net tax deferred assets and other adjustments against 2017 net income. This one-time, noncash charge against 2017 net income was $1,700,000 for ACNB Corporation. The primary component of the Corporation’s net income is net interest income, which is the income derived from the interest earned on loans and investments, less the interest paid on deposits and borrowings. Net interest income is impacted by changes in interest rates, the volume of interest earning assets and interest bearing liabilities, and the composition of these assets and liabilities. By its inherent nature, this income source is predominantly influenced by market interest rates, local economic conditions, stock market impacts, and competitive market dynamics. 2 2017 ANNUAL REVIEW During 2017, the Federal Reserve’s Open Market Committee raised the Fed Funds Rate three times for a total of 75 basis points, following single 25 basis point increases in both 2015 and 2016 after the period of no interest rate changes during the recessionary economic environment beginning in 2008. Thus, there was also heightened pressure on the net interest margin during 2017. ACNB Corporation ended the year with a net interest margin of 3.51%, up from 3.35% at the end of 2016, which compares favorably with peers in the industry. The Corporation’s net interest income for the year ended December 31, 2017, was $46,352,000—a rise of 27% over the year ended December 31, 2016. This substantial increase was a direct outcome of the acquisition in 2017. With only six months of combined operations, it is clear that the result is accretive to earnings and will contribute to the Corporation’s ongoing financial growth and stability. With contributions from the acquisition of New Windsor Bancorp, Inc., ACNB Corporation’s total assets grew to $1.6 billion at year-end 2017, up 32% from $1.2 billion at December 31, 2016. Total deposits increased by 34% from the previous year-end to $1.3 billion at December 31, 2017. And, total loans rose by 37% to $1.2 billion, as compared to December 31, 2016. Organic growth, excluding the impact of the New Windsor Bancorp, Inc. acquisition, was 4% and 8% for deposits and loans, respectively, for the twelve months ended December 31, 2017. Shareholder Dividends & Equity In 2017, ACNB Corporation furthered its long history of paying dividends to its shareholders. A cash dividend of $0.20 per share was paid in each quarter of 2017. In total, $5,233,000, or $0.80 per share, was approved by the ACNB Corporation Board of Directors and paid to shareholders in 2017 for a dividend payout ratio of 54%. Further, total stockholders’ equity continues to grow and remains strong at $153,966,000 as of December 31, 2017. Ongoing capital enhancement is fundamentally dependent upon sustained earnings growth. The ACNB Corporation Dividend Reinvestment and Stock Purchase Plan offers registered shareholders the opportunity to purchase additional shares of the Corporation’s common stock through the automatic reinvestment of cash dividends and voluntary cash payments on a quarterly basis. The benefit to the registered shareholders who elect to participate in the plan includes the convenience of the acquisition of additional shares of ACNB Corporation common stock, as well as the ability to do so without paying service fees or brokerage commissions. 2 0 17 A N N U A L R E V I E W Our Vision To be the independent financial services provider of choice in the core markets served by building relationships and finding solutions. Our Mission Statement ACNB Corporation, the financial holding company for ACNB Bank and Russell Insurance Group, Inc., strives to serve the financial and insurance needs of consumers, businesses and other entities through the multiple delivery channels of these subsidiaries. In all of its endeavors, the Corporation seeks to maintain its strength and independence as a leader in the markets served. Our management is dedicated to maximizing long-term investment value to its shareholders by means of: • Providing and marketing quality financial products and services designed to focus on the customer’s objectives; • Ensuring a productive, encouraging and growth-oriented work environment for staff members; • Adopting and leveraging new technologies for the benefit of customer service, operational efficiencies, and/or competitive position; • Managing human and capital resources for the dual purpose of effectively serving and satisfying customers’ needs and enhancing the organization’s profitability; and, • Contributing to the economic vitality and overall well-being of the communities served by actively participating as a responsible and caring corporate citizen. Fundamental to ACNB Corporation’s performance is the commitment to integrity and compliance in business conduct, as well as the recognition that our business is one built upon relationships and trust. Since the plan’s introduction in January 2011, new shares of ACNB Corporation common stock, totaling 137,654 in number with plan investments of approximately $2,800,000, have been issued to plan participants as a result of both dividend reinvestment and voluntary cash purchases, which continue to fortify the Corporation’s equity position. ACNB Bank In 2017, ACNB Corporation’s subsidiary bank, ACNB Bank, founded and headquartered in Gettysburg, Pennsylvania, celebrated 160 years in serving its local communities. During this anniversary year, the Bank expanded its geographic footprint and there are now seven community banking offices branded as NWSB Bank, A Division of ACNB Bank, in Carroll County, Maryland. With these new office locations, ACNB Bank’s network of 29 community banking offices spans five counties in southcentral Pennsylvania and northern Maryland. This long history reinforces the tradition and importance of the community banking model of reinvesting depositors’ dollars in loans to others for the economic benefit of the shared community. There may be more ways in which to deliver banking services than there were in 1857; but, the basic concepts of serving customers’ financial needs and building customer relationships are paramount to our longevity now and in the future. One area of focus in 2017 in furthering the mission at ACNB Bank was the development of Agribusiness Lending. With experienced and knowledgeable staff dedicated to this function, the initiatives to enhance the Bank’s presence in the agricultural sector resulted in an additional $13,583,000 in originated loans at December 31, 2017, for a total of $65,293,000 in loans to this industry as of the same date. These loans were made to finance the operations of crop farms, poultry hatcheries, orchards, dairy cattle and milk producers, livestock farms, and others involved in this important segment of the local economy. As in the past, the growth of ACNB Bank’s loan and deposit portfolios is key to the continued success of the organization. Competition in the banking industry, from both banks and nonbank entities, as well as in ACNB Bank’s specific marketplace, is keen. Business development, asset quality, and capital strength are all fundamental to the Bank’s day-to-day activities and contribute to the Bank’s steadfast commitment to safety and soundness. Wealth Management Effective January 1, 2018, ACNB Bank introduced the Wealth Management Division composed of Trust & Investment Services staff and Wealth Advisors. Trust & Investment Services staff provide fiduciary, estate, investment and related services to clients. Assets under administration totaled $224,056,000 at December 31, 2017, an increase of 15% from December 31, 2016. Through a third-party relationship, ACNB Bank now offers retail brokerage services, including non-deposit investment products, through the brands of ACNB Wealth Advisors and Windsor Wealth Advisors. This opportunity is an outcome of the New Windsor State Bank acquisition, resulting in an acquired portfolio of $102,689,000 at December 31, 2017. Total revenues from fiduciary, investment management and brokerage activities were $2,012,000 for the twelve-month period ended December 31, 2017, an increase of 19% in comparison to the twelve-month period ended December 31, 2016, due to the retail brokerage activity subsequent to the acquisition as well as new Trust & Investment Services account development and a higher level of assets under administration. Russell Insurance Group, Inc. Russell Insurance Group, Inc., the insurance subsidiary of ACNB Corporation, is a full-service insurance agency offering a broad range of property, casualty, and life and health insurance to both commercial and personal clients through licenses in 44 states. The agency is based in Westminster, Maryland, and also conducts business at a second office location in Germantown, Maryland. 4 2017 ANNUAL REVIEW Revenues from this subsidiary’s commissions from insurance sales totaled $5,024,000 for the year of 2017, as compared to $4,822,000 for the year of 2016. The year-over-year increase of 4% is primarily the result of increased personal lines commission income and higher contingent commissions received by the agency in 2017. Sincerely, Frank Elsner, III Chairman of the Board James P. Helt President & CEO Lynda L. Glass Executive Vice President/ Secretary & Chief Governance Officer David W. Cathell Executive Vice President/ Treasurer & Chief Financial Officer The Board of Directors Effective with the close of the New Windsor Bancorp, Inc. acquisition, two directors from this organization were appointed to the Boards of Directors of ACNB Corporation and ACNB Bank to provide insight and guidance related to the Maryland market. Todd L. Herring and D. Arthur Seibel, Jr. joined the ACNB Corporation Board of Directors as a Class 1 Director and Class 2 Director, respectively. Both of these individuals have contributed to the ongoing business of ACNB Corporation, and are subject to election by the shareholders at the 2018 Annual Meeting of Shareholders. In Closing The ACNB Corporation logo and brand identity was developed in 1987 with the intent to embody the elements of solidity representative of a sound financial institution, flexibility indicating the organization is people-oriented and not rigid, and a multidimensional quality showing organizational depth. At that time, as well as today, it reflects ACNB Corporation’s traditional values and commitment to remaining independent. This timeless focus is founded upon the true sense of community held by our Board of Directors and staff members. At ACNB Corporation, we strive to be the market leader in serving the financial and insurance needs of consumers, businesses, and other entities in our communities each business day. This responsibility, as an integral member of the local community, also entails providing meaningful job opportunities and giving back through volunteerism and community support. As always, our endeavors at ACNB Corporation seek to ensure long-term value for you, our shareholders, through continued focus on our mission built upon the strengths of commitment, independence and community. Thank you for your investment in ACNB Corporation’s future of promise and opportunities. 5 2017 ANNUAL REVIEW FINANCIAL HIGHLIGHTS For the Year Net interest income Net income Cash dividends paid Per Share Statistics Basic earnings Cash dividends paid Book value (year-end) At Year-End Total assets Total loans Total deposits 2017 2016 2015 $46,352,000 $36,566,000 $35,606,000 9,788,000 10,869,000 11,017,000 5,233,000 4,840,000 4,820,000 $ 1.50 0.80 21.92 $ 1.80 0.80 19.80 $ 1.83 0.80 18.99 $1,595,432,000 $1,206,320,000 $1,147,925,000 1,244,170,000 907,910,000 852,960,000 1,298,492,000 967,621,000 912,980,000 Total stockholders’ equity 153,966,000 120,061,000 114,715,000 Key Ratios Return on average assets Return on average equity Dividend payout Average stockholders’ equity to average assets 0.69% 7.12% 53.46% 9.69% 0.93% 9.17% 44.53% 10.10% 0.99% 9.77% 43.75% 10.10% Without the nonrecurring expenses incurred as a result of the acquisition and integration of New Windsor Bancorp, Inc., net of the corresponding tax impact at the marginal tax rate, in the amount of $3,010,000 and the one-time charge due to the Tax Cuts and Jobs Act in the amount of $1,700,000, ACNB Corporation’s net income for the year ended December 31, 2017, would have been $14,498,000. 6 2017 ANNUAL REVIEW FINANCIAL OVERVIEW Total Assets In millions of dollars $1,595.4 Total Deposits In millions of dollars $1,046.0 $1,089.8 $1,147.9 $1,206.3 $1,298.5 $800.6 $844.9 $913.0 $967.6 2013 2014 2015 2016 2017 2013 2014 2015 2016 2017 Total Loans In millions of dollars Total Stockholders’ Equity In millions of dollars $1,244.2 $154.0 $799.3 $853.0 $907.9 $728.6 $106.8 $110.0 $120.1 $114.7 2013 2014 2015 2016 2017 2013 2014 2015 2016 2017 Net Income In millions of dollars $11.0 $10.9 $10.3 $9.3 $14.5 $9.8 Book Value Per Share In dollars $17.83 $18.29 $18.99 $19.80 $21.92 2013 2014 2015 2016 2017 2013 2014 2015 2016 2017 7 2017 ANNUAL REVIEW CONSOLIDATED STATEMENTS OF CONDITION Dollars in thousands, except per share data Assets Cash and due from banks Interest bearing deposits with banks Total Cash and Cash Equivalents Securities available for sale Securities held to maturity (fair value $44,549 in 2017 and $55,425 in 2016) Loans held for sale Loans, net of allowance for loan losses ($13,976 in 2017 and $14,194 in 2016) Premises and equipment Restricted investment in bank stocks Investment in bank-owned life insurance Investments in low-income housing partnerships Goodwill Intangible assets Foreclosed assets held for resale Other assets TOTAL ASSETS Liabilities Deposits Non-interest bearing Interest bearing Total Deposits Short-term borrowings Long-term borrowings Other liabilities TOTAL LIABILITIES Stockholders’ Equity December 31 2017 19,304 $ 2016 13,796 $ 15,137 34,441 5,135 18,931 159,051 142,990 44,829 1,736 55,568 1,770 1,230,194 893,716 26,774 4,773 44,935 2,446 19,580 2,569 436 23,668 18,153 4,349 40,742 2,899 6,308 688 256 19,950 $ 1,595,432 $ 1,206,320 $ 279,413 $ 180,593 1,019,079 1,298,492 36,908 94,600 11,466 787,028 967,621 34,590 74,250 9,798 1,441,466 1,086,259 Preferred stock (par value $2.50; 20,000,000 shares authorized; no shares outstanding) — — Common stock (par value $2.50; 20,000,000 shares authorized; 7,086,258 and 6,126,738 shares issued in 2017 and 2016, respectively; 7,023,658 and 6,064,138 shares outstanding in 2017 and 2016, respectively) Treasury stock, at cost (62,600 shares in 2017 and 2016) Additional paid-in capital Retained earnings Accumulated other comprehensive loss TOTAL STOCKHOLDERS’ EQUITY TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY 17,716 15,317 728 ) ) 37,777 106,293 7,092 ) ) ) 728 ) 10,941 100,555 6,024 ) ) 153,966 120,061 $ 1,595,432 $ 1,206,320 See the consolidated financial statements and accompanying notes presented in the Corporation’s Annual Report on Form 10-K. 8 2017 ANNUAL REVIEW CONSOLIDATED STATEMENTS OF INCOME Dollars in thousands, except per share data $ Interest Income Loans, including fees Securities Taxable Tax-exempt Dividends Other TOTAL INTEREST INCOME Interest Expense Deposits Short-term borrowings Long-term borrowings TOTAL INTEREST EXPENSE NET INTEREST INCOME PROVISION FOR LOAN LOSSES NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES Other Income Service charges on deposit accounts Income from fiduciary, investment management and brokerage activities Earnings on investment in bank-owned life insurance Gains on sales or calls of securities Gain on sales of premises and equipment Service charges on ATM and debit card transactions Commissions from insurance sales Other TOTAL OTHER INCOME Other Expenses Salaries and employee benefits Net occupancy Equipment Other tax Professional services Supplies and postage Marketing and corporate relations FDIC and regulatory Merger-related expenses Intangible assets amortization Foreclosed real estate expenses Other operating TOTAL OTHER EXPENSES INCOME BEFORE INCOME TAXES PROVISION FOR INCOME TAXES NET INCOME Per Share Data Basic earnings Cash dividends paid Years Ended December 31 2017 47,522 2016 36,339 $ $ 3,389 428 252 194 51,785 3,547 83 1,803 5,433 46,352 — 46,352 2,940 2,012 1,075 — — 1,762 5,024 1,336 14,149 24,654 2,403 3,757 791 1,134 731 433 644 4,728 537 93 4,174 44,079 16,422 6,634 3,179 651 212 119 40,500 2,369 51 1,514 3,934 36,566 — 36,566 2,369 1,684 1,100 26 449 1,499 4,822 1,259 13,208 22,200 2,066 3,046 785 852 646 574 611 472 345 55 3,485 35,137 14,637 3,768 2015 35,090 3,127 859 301 87 39,464 2,120 47 1,691 3,858 35,606 — 35,606 2,308 1,589 1,100 261 — 1,456 4,634 1,058 12,406 20,932 2,170 3,007 779 844 639 452 665 — 336 119 3,291 33,234 14,778 3,761 $ 9,788 $ 10,869 $ 11,017 $1.50 $0.80 $1.80 $0.80 $1.83 $0.80 9 2017 ANNUAL REVIEW BOARDS OF DIRECTORS ACNB Corporation and ACNB Bank Boards of Directors Richard L. Alloway II Pennsylvania State Senator 33rd State Senate District Scott L. Kelley, Esquire Partner Barley Snyder LLP Frank Elsner, III Owner & Managing Director ODT Global, LLC Chairman of the Board ACNB Corporation and ACNB Bank James P. Helt President & Chief Executive Officer ACNB Corporation and ACNB Bank Todd L. Herring Market Director Pivot Physical Therapy James J. Lott President Bonnie Brae Fruit Farms, Inc. Donna M. Newell President & Chief Executive Officer NTM Engineering, Inc. J. Emmett Patterson Owner & President JDCS Enterprise & Fry Guy Corporation Russell Insurance Group, Inc. Board of Directors Thomas A. Ritter Chairman of the Board Frank Elsner, III Vice Chairman Daniel W. Potts Partner IBM Banking & Insurance Consulting Practice Thomas A. Ritter Retired President & Chief Executive Officer ACNB Corporation and ACNB Bank Marian B. Schultz Retired Dean Shippensburg University D. Arthur Seibel, Jr. Chief Operating Officer Springdale Preparatory School LLC David L. Sites Owner Sites Realty Inc. and Realty Leasing & Management Co. Alan J. Stock Retired Owner & President Eicholtz Company Vice Chairman ACNB Corporation and ACNB Bank James E. Williams President C.E. Williams Sons, Inc. Managing Partner Frantz Plumbing Lynda L. Glass James P. Helt Scott L. Kelley, Esquire Daniel W. Potts Frank C. Russell, Jr. OFFICERS ACNB Corporation Frank Elsner, III Chairman of the Board ACNB Bank Frank Elsner, III Chairman of the Board James P. Helt President & Chief Executive Officer David W. Cathell Executive Vice President/ Treasurer & Chief Financial Officer Lynda L. Glass Executive Vice President/ Secretary and Chief Risk & Governance Officer James P. Helt President & Chief Executive Officer Lynda L. Glass Executive Vice President/ Secretary & Chief Governance Officer David W. Cathell Executive Vice President/ Treasurer & Chief Financial Officer Tom N. Rasmussen Executive Vice President/ Market President Kathy S. Hansel Senior Vice President/ Principal Accounting Officer Douglas A. Seibel Executive Vice President/ Chief Lending & Revenue Officer Thomas R. Stone Executive Vice President/ Chief Community Banking Officer Mark P. Bernier Senior Vice President/ Wealth Management Officer Andrew P. Heck Senior Vice President/ Regional Commercial Lending Manager Lisa A. Monthley Senior Vice President/ Regional Sales Manager Michelle N. Paulnock Senior Vice President/ Information Systems Manager Carl L. Ricker Senior Vice President/ Residential Mortgage Lending Sales Manager Lauren L. Shutt Senior Vice President/ Risk Manager Wayne A. Steinour Senior Vice President/ Agribusiness Lending Manager Scott A. Yeager Senior Vice President/ Consumer Lending Sales & Training Manager Laurie A. Laub Executive Vice President/ Chief Credit & Operations Officer Sandra A. Deaner Senior Vice President/ Human Resources Manager 10 2017 ANNUAL REVIEW First Vice Presidents Karen B. Arthur Barry C. Dillman Scott E. Hartlaub Vice Presidents Brian T. Adair Daniel K. Baer Dawn M. Bornman Cara Lynn Clabaugh David W. Deaner Tiffany M. Faust Charlene L. Feuchtenberger Barbara D. Guise Assistant Vice Presidents Eric L. Alleman Susan L. Behm Tonya A. Boczek Amber R. Bowers Kevin L. Cook Andree V. Dennis Kellie J. Doherty Carolyn M. Dull Kevin J. Hayes L. John Hicks Dennis R. Hollinger Stephen C. Hawbaker Laura A. Histon Vickie L. Hoffheins Gary R. Holder Thomas A. Holmes Leslie R. Horn John E. Kashner Frank E. Koser II Heather D. Ebersole Kim D. Elmo Catherine L. Frattali Jacqueline A. Grasley Nancy L. Hamilton Grant J. Holub Ginny L. Huntsberry Holly A. Keffer Laura L. McCusker Cheryl A. McVay Gary W. Rappoldt Merle J. Zehr Beth W. Lesko Gregory S. Liegey Thomas E. Long Donald C. McVay Celeste M. Miller Kenneth L. Miller Scott A. Miller Lauren J. Muzzy Douglas R. Lindsay Michael E. Lippy George F. Marguglio Julie A. Marshall Lauren E. McMullen Susan M. Saylor Sara M. Sciarretta Angela M. Sibert Timothy H. Owings Jeffrey A. Pottorff Michael W. Rittase Patrick O. Sease Christine R. Settle James E. Showvaker Rhonda L. Winterstein Christina D. Ziser Tammy J. Smarsh Lisa A. Smith Anthony A. Spangler Jeffrey B. Stambaugh Ruby L. Sullivan Brian C. Taylor Tia M. Williams Tracy L. Wolf Russell Insurance Group, Inc. Frank C. Russell, Jr. President & Chief Executive Officer Daniel J. Coughlin Vice President David W. Cathell Vice President & Treasurer Lynda L. Glass Vice President & Secretary 11 2017 ANNUAL REVIEW OFFICE LOCATIONS ACNB Bank Arendtsville Arendtsville Office 101 Main Street Arendtsville, PA 17303 Bendersville Bendersville Office 101 North Main Street Bendersville, PA 17306 Biglerville Biglerville Office 3459 Biglerville Road Biglerville, PA 17307 Cashtown Franklin Township Drive-Up 10 High Street Cashtown, PA 17310 Chambersburg Chambersburg Office 850 Norland Avenue Chambersburg, PA 17201 Chambersburg Drive-Up 915 Wayne Avenue Chambersburg, PA 17201 Dillsburg Dillsburg Office 3 Tristan Drive Dillsburg, PA 17019 East Berlin East Berlin Office 1677 Route 194 North East Berlin, PA 17316 Fairfield/Carroll Valley Fairfield/Carroll Valley Office 4910 Fairfield Road Fairfield, PA 17320 Gettysburg Adams Commerce Center Drive-Up 100 V-Twin Drive Gettysburg, PA 17325 Lincoln Square Office 16 Lincoln Square Gettysburg, PA 17325 North Gettysburg Office 675 Old Harrisburg Road Gettysburg, PA 17325 West Gettysburg Office 545 West Middle Street Gettysburg, PA 17325 Hanover North Hanover Office 1127 Eichelberger Street Hanover, PA 17331 South Hanover Office 1801 Baltimore Pike Hanover, PA 17331 Littlestown Littlestown Office 444 West King Street Littlestown, PA 17340 NWSB Bank, A Division of ACNB Bank Eldersburg Eldersburg Office 1708 Liberty Road Eldersburg, MD 21784 Hampstead Hampstead Office 2305 Hanover Pike Hampstead, MD 21074 Mt. Airy Mt. Airy Office 1001 Twin Arch Road Mt. Airy, MD 21771 New Windsor New Windsor Office 213 Main Street New Windsor, MD 21776 Russell Insurance Group, Inc. Westminster Office 2526 West Liberty Road Westminster, MD 21157 Germantown Office 19500 Amaranth Drive, Suite C Germantown, MD 20874 12 McSherrystown McSherrystown Office 369 Main Street McSherrystown, PA 17344 New Oxford New Oxford Office 318 Lincoln Way East New Oxford, PA 17350 Newville Newville Office 39 Carlisle Road Newville, PA 17241 Spring Grove Spring Grove Office 221 North Main Street Spring Grove, PA 17362 York South York Plaza Office 201 Pauline Drive York, PA 17402 York Loan Office 1601 South Queen Street York, PA 17403 York Springs York Springs Office 202 Main Street York Springs, PA 17372 Westminster College Square Office 444 WMC Drive Westminster, MD 21158 Market Place Office 810 Market Street Westminster, MD 21157 Taneytown Taneytown Office 222 East Baltimore Street Taneytown, MD 21787 2017 ANNUAL REVIEW CONTACT INFORMATION ACNB Bank acnb.com NWSB Bank nwsbbank.com Russell Insurance Group, Inc. riginsurance.com Customer Contact Center Toll Free 1.888.334.ACNB (2262) Customer Contact Center Toll Free 1.844.822.NWSB (6972) Toll Free 1.800.289.4097 24-Hour Telephone Banking Line Toll Free 1.888.338.ACNB (2262) 24-Hour Telephone Banking Line Toll Free 1.866.276.4979 Forward-Looking Statements In addition to historical information, this document contains forward-looking statements. Examples of forward-looking statements include, but are not limited to, (a) projections or statements regarding future earnings, expenses, net interest income, other income, earnings or loss per share, asset mix and quality, growth prospects, capital structure, and other financial terms, (b) statements of plans and objectives of management or the Board of Directors, and (c) statements of assumptions, such as economic conditions in the Corporation’s market areas. Such forward-looking statements can be identified by the use of forward-looking terminology such as “believes”, “expects”, “may”, “intends”, “will”, “should”, “anticipates”, or the negative of any of the foregoing or other variations thereon or comparable terminology, or by discussion of strategy. Forward-looking statements are subject to certain risks and uncertainties such as local economic conditions, competitive factors, and regulatory limitations. Actual results may differ materially from those projected in the forward-looking statements. Such risks, uncertainties and other factors that could cause actual results and experience to differ from those projected include, but are not limited to, the following: the effects of governmental and fiscal policies, as well as legislative and regulatory changes; the effects of new laws and regulations, specifically the impact of the Tax Cuts and Jobs Act and the Dodd-Frank Wall Street Reform and Consumer Protection Act; impacts of the new capital and liquidity requirements of the Basel III standards; the effects of changes in accounting policies and practices, as may be adopted by the regulatory agencies, as well as the Financial Accounting Standards Board and other accounting standard setters; ineffectiveness of the business strategy due to changes in current or future market conditions; future actions or inactions of the United States government, including the effects of short- and long-term federal budget and tax negotiations and a failure to increase the government debt limit or a prolonged shutdown of the federal government; the effects of economic deterioration and the prolonged economic malaise on current customers, specifically the effect of the economy on loan customers’ ability to repay loans; the effects of competition, and of changes in laws and regulations on competition, including industry consolidation and development of competing financial products and services; the risks of changes in interest rates on the level and composition of deposits, loan demand, and the values of loan collateral, securities, and interest rate protection agreements, as well as interest rate risks; difficulties in acquisitions and integrating and operating acquired business operations, including information technology difficulties; challenges in establishing and maintaining operations in new markets; the effects of technology changes; volatilities in the securities markets; the effect of general economic conditions and more specifically in the Corporation’s market area; the failure of assumptions underlying the establishment of reserves for loan losses and estimations of values of collateral and various financial assets and liabilities; acts of war or terrorism; disruption of credit and equity markets; the ability to manage current levels of impaired assets; the loss of certain key officers; the ability to maintain the value and image of the Corporation’s brand and protect the Corporation’s intellectual property rights; continued relationships with major customers; and, potential impacts to the Corporation from continually evolving cybersecurity and other technological risks and attacks, including additional costs, reputational damage, regulatory penalties, and financial losses. We caution readers not to place undue reliance on these forward-looking statements. They only reflect management’s analysis as of this date. The Corporation does not revise or update these forward-looking statements to reflect events or changed circumstances. Please carefully review the risk factors described in other documents the Corporation files from time to time with the Securities and Exchange Commission, including the Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q. Please also carefully review any Current Reports on Form 8-K filed by the Corporation with the Securities and Exchange Commission. 16 LINCOLN SQUARE | PO BOX 3129 | GETTYSBURG, PA 17325 | ACNB.COM