host1 is supposed to be replaced by the name of the first machine, etc.
so assuming that your machines have names red, blue, and green a hostfile like this should work (for one charmm process on each machine, and red is the machine on which you start the job):
red 0 ~charmm/exec/gnu/charmm
blue 1 ~charmm/exec/gnu/charmm
green 1 ~charmm/exec/gnu/charmm
if you want two processes/machine your mpich installation has to be configured for shared-memory communication, and you increase the process counts by one in the example above. note that certain modules in charmm require that the number of CPUs in a parallel job is a power of two (1,2,4,8,...).