The Offering On April 22, 2009, the Board of Directors of PMMHC adopted a Plan of Conversion (the “Plan”), which provides for the conversion of PMMHC from mutual to stock form (the “Conversion”), the formation of HoldCo as a holding company that will own 100% of the common stock of PMMHC, and the issuance of all of PMMHC’s outstanding common stock to HoldCo. In connection with the Conversion, HoldCo is offering up to 6,772,221 shares (the “Shares”) of common stock, par value $0.01 per share (the “Common Stock”), in (i) a subscription offering (the “Subscription Offering”), and, if necessary, (ii) a direct community offering (the “Community Offering”), and (iii) a syndicated community offering (the “Syndicated Community Offering”). The Subscription Offering, the Community Offering and the Syndicated Community Offering are herein sometimes collectively referred to as the “Offering.” HoldCo will issue the Shares at a purchase price of $10.00 per share (the “Purchase Price”). If the number of Shares is increased or decreased in accordance with the Plan, the term “Shares” shall mean such greater or lesser number, where applicable. The shares of Common Stock to be offered in the Subscription Offering will be offered pursuant to nontransferable subscription rights in the following order of priority (subject to limitations set forth in the Plan): • eligible members of PMMHC, who are the policyholders under individual policies of insurance issued by PMIC and in force on April 22, 2009 (“Eligible Members”); • an employee stock ownership plan to be established as a tax-qualified plan of HoldCo; and • directors, officers and employees of the Primary Parties as of the commencement of the Offering. HoldCo may offer shares of Common Stock for which subscriptions have not been received in the Subscription Offering in the Community Offering to the following categories of subscribers (listed in order of priority) before offering them to the general public: • licensed insurance agencies and/or brokers that have been appointed by or otherwise are under contract with PMIC to market and distribute policies of insurance; and • named insureds under policies of insurance issued by PMIC after April 22, 2009; and • natural persons and trusts of natural persons residing in Lackawanna or Luzerne Counties, Pennsylvania. In the event a Community Offering is held, it may be held at any time during or immediately after the Subscription Offering. Depending on market conditions, shares not subscribed for in the Subscription Offering or in the Community Offering may be offered in the Syndicated Community Offering to selected members of the general public through a syndicate of registered broker-dealers who are members of the Financial Industry Regulatory Authority (“FINRA”). The Syndicated Community Offering will be co-managed by the Agent and Sterne, Agee & Xxxxx, Inc. (“Sterne Agee”). It is acknowledged that the number of Shares to be sold in the Offering may be increased or decreased as described in the Prospectus (as hereinafter defined), that the purchase of Shares in the Offering is subject to maximum and minimum purchase limitations as described in the Prospectus, and that HoldCo may reject, in whole or in part, any subscription received in the Community Offering or Syndicated Community Offering. HoldCo has filed with the U.S. Securities and Exchange Commission (the “Commission”) a Registration Statement on Form S-1 (File No. 333-156936) in order to register the Shares under the Securities Act of 1933, as amended (the “1933 Act”), and the regulations promulgated thereunder (the “1933 Act Regulations”) and has filed such amendments thereto as have been required to the date hereof (the “Registration Statement”). The prospectus, as amended, included in the Registration Statement at the time it initially becomes effective is hereinafter called the “Prospectus,” except that if any prospectus is filed by HoldCo pursuant to Rule 424(b) or (c) of the regulations of the Commission under the 1933 Act differing from the prospectus included in the Registration Statement at the time it initially becomes effective, the term “Prospectus” shall refer to the prospectus filed pursuant to Rule 424(b) or (c) from and after the time said prospectus is filed with the Commission and shall include any supplements and amendments thereto from and after their dates of effectiveness or use, respectively. Concurrently with the execution of this Agreement, HoldCo is delivering to the Agent copies of the Prospectus, dated , 2009, of HoldCo to be used in the Subscription Offering and Community Offering (if any), and, if necessary, will deliver copies of the Prospectus and any prospectus supplement for use in a Syndicated Community Offering as defined in the Prospectus.
