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Porch Group announced the pricing of a private offering of $333 million aggregate principal amount of its 6.75% Senior Secured Convertible Notes due 2028 in a private placement transaction, and a concurrent privately negotiated repurchase of $200 million aggregate principal amount of its 0.75% Convertible Senior Notes due 2026. The New Notes offering and Existing Notes repurchase are expected to close concurrently on April 20, 2023, subject to customary closing conditions. The New Notes will be convertible into cash, shares of common stock of the Company, or a combination of cash and shares of common stock at Porch's election at an initial conversion rate of 39.9956 shares of common stock per $1,000 principal amount of the New Notes, which is equivalent to an initial conversion price of approximately $25.00 per share. Porch intends to use the net proceeds from the New Notes offering to repurchase $200 million of the Existing Notes and to fund the repayment of a $10 million senior secured term loan of a Porch Group subsidiary, in each case plus accrued and unpaid interest thereon and related fees and expenses, and use the remainder of the net proceeds for general corporate purposes. Following the closing of this transaction, Porch Group will hold: $225 million aggregate principal amount of the unsecured Existing Notes due 2026; $333 million aggregate principal amount of secured New Notes due 2028. The transaction is additionally expected to result in approximately $100 million of additional cash to Porch Group, net of the debt repayments described above and payment of related fees and expenses.

Porch Group announced that its insurance business, Homeowners of America, has filed an application to form and license a Texas reciprocal insurance exchange with the Texas Department of Insurance. If approved and fully implemented by Porch, its insurance underwriting business would be conducted exclusively through the Reciprocal.The formation of the Reciprocal is an initial step in Porch's long-term strategy to reduce its exposure to earnings volatility from its Insurance segment by mitigating direct exposure to insurance claims and weather events. The Reciprocal may also help to reduce the impact of a challenging reinsurance market that has both less capacity and higher prices. Homeowners that purchase policies in the Reciprocal could receive benefits and value-added services unique to what Porch and its various companies offer. Similarly, Porch would be able to continue to pursue its growth strategy by reaching homebuyers early and throughout the homebuying journey, and leveraging access to homebuyer information and property data. A reciprocal insurer is an insurance association owned by its policyholder-members who spread risk by pooling their risks together. This reciprocal exchange structure has been utilized by other homeowner insurance businesses such as Farmers Insurance. The day-to-day operations of the Reciprocal would be managed by a subsidiary of Porch, which would receive ongoing fees for originating, underwriting and processing claims on behalf of the Reciprocal. The launch of the Reciprocal remains subject to review and approval by the TDI, which is not expected before Q3 2023. Formation of the reciprocal is subject to ongoing Porch and regulatory review in context of broader capital and operating environment and the decision to proceed remains within the Company's discretion.