PROXY VOTING INFORMATION

The Securities and Exchange Commission approved the “Notice and Access” rule in July 2007 to provide all shareholders with the ability to choose how they access proxy materials. This rule also gives companies the option to publish proxy materials on a public website and notify shareholders where these materials can be accessed. We elected to use Notice and Access for our 2008 Annual Meeting proxy materials.

Instead of sending each shareholder a full set of paper proxy materials (annual report, meeting notice, proxy statement and proxy card), PHC, Inc., or a shareholder’s bank or broker, will mail shareholders a form called, “Notice of Internet Availability of Proxy Materials” (the “Notice”).

The Notice contains important information about:

• How to access the annual meeting proxy materials;
• How to request paper or email copies of the proxy materials at no charge;
• How to vote shares online or by telephone or to request a paper proxy card;
• The time and location of the annual meeting (directions to Corporate Office); and
• The list of matters to be voted on.        

Since the Notice contains important information, including a shareholder voting control number, the Notice should be kept until the meeting date.

The Notice will be mailed to shareholders. Please promptly vote and submit your proxy by telephone, over the Internet or, if you receive paper copies of the proxy materials, by following the instructions on the proxy card. If your stock registrations are not identical, you may receive more than one Notice.

We encourage you to take advantage of Internet or telephone voting. Both are available 24 hours a day, 7 days a week.  Additional information on Internet and telephone voting is printed on your proxy material Notice.

For more information, please refer to Frequently Asked Questions about Notice and Access below.     

FREQUENTLY ASKED QUESTIONS ABOUT NOTICE AND ACCESS

What is Notice and Access?

Notice and Access is a change in the traditional way that proxy materials are made available to shareholders. For an annual meeting, for example, a public company previously would have to mail copies of the annual report, a meeting notice, and a proxy statement and proxy card to shareholders.

Notice and Access now allows shareholders to choose how they would like to access the proxy materials:  in paper form; by email; or online.

How will the Notice and Access process work for PHC, Inc. shareholders?

We have chosen to use the “notice only” option. This means that we will not mail or deliver paper sets of annual meeting proxy materials to our shareholders, as we have done previously.  Instead, beginning on or about October 30, 2008, we will mail, or your bank, broker, trustee or other intermediary will send to you the Notice.

Why are we using Notice and Access?

We chose this option because it will significantly reduce the printing, delivery and postage costs of our proxy solicitation and will have positive environmental impacts as we will use much less paper to print and less fuel to deliver our proxy materials.

Once I receive the Notice, what do I have to do?

You must decide how you would like to access the annual meeting proxy materials. You will have three choices:

• you can go to the website shown on the Notice, review the proxy materials online, and vote your shares at the site, or by telephone; or
• you can request paper copies of the proxy materials, including a proxy or voting instruction card, at no charge; or
• you can request that we email proxy materials to you at no charge other than your usual Internet access fees.

The Notice will explain how to choose each of these options. Most important, the Notice will contain a control number that you will need to access the proxy materials, request paper or email copies, and to vote your shares online or by telephone. We suggest that you retain the Notice through the date of the annual meeting.

So I can’t vote my shares just by returning the Notice?

No.  The Notice is not a proxy card or ballot.

I prefer to vote by telephone. Will the Notice have the telephone number to call to vote my shares?

No. The SEC rules don’t allow the voting telephone number to be printed on the Notice. Once you log onto the website address given on the Notice, the telephone number to use for voting will be displayed.

The telephone number that appears on the Notice is only for requesting paper or email copies of the proxy materials.

How long do I have to request paper or email copies of the proxy materials?

The Notice will contain a cutoff date for making your request. If you know that you will be requesting paper copies, please request them as soon as possible after you receive the Notice.

If I request paper copies of the proxy materials, how long will it take to receive them?

Under the SEC’s rules, the proxy materials must be mailed within three business days after receiving your request.  The date on which you will receive the materials will depend on the postal system.  Again, if you know that you want paper copies of the proxy materials, please request them as soon as possible after you receive the Notice.

You will have the option to make a permanent election to have paper or email copies of proxy materials sent to you in the future at no charge.

Do I have to pay any charges to receive paper copies of the proxy materials?

No. The materials will be sent to you without charge.

I’ve lost my Notice and the control number on it. What do I do?

If you are a registered shareholder on the books of our transfer agent (you don’t hold your shares through a bank, broker, trustee or other intermediary), please call 1-800-543-2447 ext 233.

If you do hold your PHC, Inc. stock through a bank, broker, trustee, or other intermediary, please call your bank, broker, trustee, or other intermediary for assistance.