<PAGE>
To: BUSINESS WIRE AMY LYNCH
Fax#: 312-573-0019 Ph.#: 888-292-4446
PRESS RELEASE (#1) September 5, 2000
Contact: M. Gregory M. Shepard
Chairman and President
American Union Insurance Company
Phone: (309) 827-5968
AMERICAN UNION INSURANCE COMPANY ISSUES LETTER TO MERIDIAN INSURANCE GROUP, INC.
TO MEET TO DISCUSS TRANSACTION
Today, Tuesday, September 5, 2000, Meridian Insurance Group Acquisition
Corporation, through Gregory M. Shepard, its Chairman and President, issued a
letter to Ms. Norma J. Oman, the President and Chief Executive Officer of
Meridian Insurance Group, Inc. asking for a meeting next week to discuss
amicably resolving the transaction.
The contents of the letter are as follows:
Ms. Norma J. Oman
President and Chief Executive Officer
Meridian Insurance Group, Inc.
2955 North Meridian Street
Indianapolis, Indiana
Dear Norma:
I would like to meet with you and the board of directors of Meridian
Insurance Group, Inc. next week to discuss the details of my offer and to
amicably discuss this matter.
Please call me at your earliest convenience.
Sincerely,
/s/ Gregory M. Shepard
Gregory M. Shepard
Chairman and President
Meridian Insurance Group Acquisition Corporation
<PAGE>
On Thursday, August 31, 2000, American Union Insurance Company commenced a cash
tender offer for all of the common stock of Meridian Insurance Group, Inc., for
$20 per share, which represented a 57% premium based on the closing share price
on August 29, 2000.
The offer is conditioned upon, among other things, (1) there being validly
tendered and not properly withdrawn prior to the expiration of the offer a
number of common shares which, together with the 1,588,400 common shares [20.23%
of the June 30, 2000 outstanding] owned by Shepard, constitute at least 50.1% of
the voting securities of Meridian Insurance Group Inc. outstanding or issuable
under the company's stock option plans, (2) Meridian's redemption of its
preferred share purchase rights, (3) American Union being satisfied, in its sole
discretion, that the provisions of the Indiana Business Combination chapter are
inapplicable to the offer and the proposed merger described herein, (4) American
Union being satisfied, in its sole discretion, that the provisions of the
Indiana Control Share Acquisitions chapter are inapplicable to the offer and the
proposed merger described herein, (5) American Union having obtained all
insurance regulatory approvals necessary for their acquisition of control of
Meridian and its insurance subsidiaries and affiliates on terms and conditions
satisfactory to American Union, in its sole discretion, and (6) America Union
obtaining financing.
The offer and its withdrawal rights will expire at 5:00 P.M., New York City
time, on September 29, 2000, unless the offer is extended. The offer is being
made through a wholly owned subsidiary of American Union.
The Depositary and Information Agent for the offer is ChaseMellon Shareholder
Services, L.L.C., 44 Wall Street, 7th Floor, New York, New York, 10005, Call
Toll-Free (888) 451-6741.
American Union Insurance Company is a Bloomington, Illinois based property and
casualty insurance company originally chartered in 1916 by L.F. Shepard as Union
Automobile Insurance Association. The present name was adopted in 1998. Today
50% of American Union's common stock is owned by Gregory M. Shepard and 50% by
Tracy M. Shepard, who are brothers.
