On June 27, 2012 we announced two proposed transactions. Our first announcement is that Medmarc Insurance Group (Medmarc) has agreed to become part of ProAssurance through a proposed $153.7 million, all cash, sponsored demutualization that will provide Medmarc’s eligible Members with cash payments of $146.2 million and future policy credits of $7.5 million. We intend to fund this transaction from cash on hand—there are no financing contingencies to the transaction. Medmarc is one of the nation’s leading underwriters of products liability insurance for medical technology and life sciences, and also underwrites a book of legal professional liability insurance. Medmarc had direct written premium of $40.6 million in 2011 and $320 million in total assets as of March 31, 2012. Medmarc’s A. M. Best rating of “A-” (Excellent) was recently affirmed. Medmarc has adopted a Plan of Conversion that will govern the sponsored-demutualization. If the Plan of Conversion is approved by Medmarc’s eligible Members, the sponsored demutualization will convert Medmarc into a non-public stock company. Simultaneously, under the terms of the Stock Purchase Agreement entered into by ProAssurance and Medmarc, ProAssurance will purchase the stock authorized in the demutualization and Medmarc’s eligible Members would then receive $153.7 million in cash payments and future policy credits, as outlined in the Plan of Conversion. The Plan of Conversion defines an eligible Member as a medical technology or life sciences company holdingwith an in-force policy issued by a Medmarc company at any time from December 31, 2010 through June 30, 2012. Policies with effective dates between June 27, 2012 and June 30, 2012, must have had a quote issued on or before June 26, 2012. In addition to the approval of Medmarc's eligible Members, the transaction must be approved by insurance regulators in Vermont, where Medmarc is domiciled. The Boards of Directors for both companies unanimously approved the transaction, which is expected to close before the end of 2012. A copy of the news release announcing this proposed transaction is included as Exhibit 99.1 and included in this Item by reference. | 
