Not quite... Associate Members can only send or receive 25 PM's. This is to prevent outsiders from spamming members. Additionally, the system throttles PM's, again to make spamming hard. Full Members can send and receive unlimited PM's.
However, you are misinterpreting the screen. When you PM a member, their name shows up underneath the box to add further recipients to the PM. The red box is there if you'd like to remove the person from the addressee list. So just enter a subject, enter your message and submit.