NWLI National Western Life Group Inc

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549

________________

SCHEDULE 14A

________________

Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934

Check the appropriate box:

NATIONAL WESTERN LIFE GROUP, INC.

(Name of Registrant as Specified in its Charter)

_________________________________________________________________
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

Dear National Western Life Group, Inc. Stockholder:

The board of directors of National Western Life Group, Inc. (“National Western”) approved an Agreement and Plan of Merger (the “merger agreement”) among National Western, S. USA Life Insurance Company, Inc., an Arizona insurance company (“Parent”), and PGH Merger Inc., a Delaware corporation and a direct, wholly-owned subsidiary of Parent (“Merger Sub”), which provides for the acquisition of National Western by Parent.

Pursuant to the terms of the merger agreement, if the transaction is completed, Merger Sub will merge with and into National Western, with National Western surviving as a direct, wholly-owned subsidiary of Parent (the “merger”). If the merger is completed, each share of common stock issued and outstanding at the effective time of the merger, will be converted into the right to receive $500.00 in cash without interest (the “merger consideration”).

National Western has two classes of common stock: Class A common stock and Class B common stock. Together, these two classes of common stock are referred to as the “Company common stock.” The Class A common stock is currently listed for trading on the NASDAQ Global Select Market under the symbol “NWLI.” We urge you to obtain current market quotations of the Class A common stock. The Class B common stock is held by two stockholders and is not traded on any stock exchange.

At a special meeting of National Western stockholders (the “Special Meeting”), National Western stockholders will be asked to vote on the adoption of the merger agreement. Approval of this proposal requires the affirmative vote of the holders of a majority of the combined voting power of the issued and outstanding shares of Class A common stock and Class B common stock, voting together as a single class. At the Special Meeting, National Western stockholders will also be asked to approve, on an advisory (non-binding) basis, the compensation that may be paid or become payable to National Western’s named executive officers that is based on or otherwise relates to the proposed merger. At the Special Meeting, National Western stockholders may also be asked to approve an adjournment of the Special Meeting to a later date or dates, if necessary or appropriate, to solicit additional proxies in the event there are not sufficient votes at the time of the Special Meeting to adopt the merger agreement.

The National Western board of directors has unanimously adopted and approved the merger and the merger agreement and unanimously recommends that the National Western stockholders vote:

•        “FOR” the proposal to adopt the merger agreement;

•        “FOR” the proposal to approve, on an advisory (non-binding) basis, the compensation that may be paid or become payable to National Western’s named executive officers that is based on or otherwise relates to the proposed merger; and

•        “FOR” the proposal to approve the adjournment of the Special Meeting, if necessary or appropriate, to permit further solicitation of proxies in favor of the proposal to adopt the merger agreement.

Your vote is very important, regardless of the number of shares of Company common stock you own. Regardless of whether you plan to attend the Special Meeting in person, please complete, sign, date and return, as promptly as possible, the enclosed proxy card in the accompanying prepaid reply envelope, or submit your proxy by telephone or over the internet, prior to the Special Meeting to ensure that your shares of Company common stock will be represented at the Special Meeting if you are unable to attend. If you attend the Special Meeting and vote in person, your vote by ballot will revoke any proxy previously submitted. The failure to vote your shares of Company common stock will have the same effect as voting “AGAINST” the proposal to adopt the merger agreement.

If your shares of Company common stock are held in “street name” by your bank, brokerage firm or other nominee, your bank, brokerage firm or other nominee will be unable to vote your shares of Company common stock without instructions from you. You should instruct your bank, brokerage firm or other nominee on how to vote your shares of Company common stock in accordance with the procedures provided by your bank, brokerage firm or other nominee. The failure to instruct your bank, brokerage firm or other nominee to vote your shares of Company common stock will have the same effect as voting “AGAINST” the proposal to adopt the merger agreement.

Submitting a proxy will not prevent you from voting in person, and it will help to secure a quorum and avoid added solicitation costs. Any eligible record holder of Company common stock who is present at the Special Meeting may vote in person, thereby revoking any previous proxy. In any event, a proxy may be revoked in writing at any time before the Special Meeting in the manner described in the accompanying proxy statement. If your shares are held in the name of a bank, broker or other nominee, please follow the instructions on the voting instruction card furnished by your bank, broker or other nominee.

The obligations of Parent and National Western to complete the merger are subject to the satisfaction or waiver of several conditions. The accompanying proxy statement contains detailed information about Parent, National Western, the Special Meeting, the merger agreement and the merger. We encourage you to read the proxy statement carefully and in its entirety before voting.

On behalf of the board of directors and management of National Western, we thank you for your support.

National Western Life Group, Inc.
10801 N. Mopac Expy, Bldg. 3
Austin, Texas 78759
(512) 836-1010

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS

To Be Held On January 8, 2024

To the Stockholders of National Western Life Group, Inc.:

We are pleased to invite you to attend the special meeting (the “Special Meeting”) of stockholders of National Western Life Group, Inc. (“National Western” or the “Company”), to be held at Moody Gardens Hotel at Seven Hope Boulevard, Galveston, Texas 77554 on January 8, 2024, at 9:00 a.m., Galveston time, for the following purposes:

•        to vote on a proposal to adopt the Agreement and Plan of Merger, dated as of October 8, 2023, by and among National Western, S. USA Life Insurance Company, Inc., an Arizona insurance company (“Parent”), and PGH Merger Inc., a Delaware corporation and a direct, wholly-owned subsidiary of Parent (“Merger Sub”), as it may be amended from time to time (the “merger agreement”), a copy of which is included as Annex A to the proxy statement of which this notice is a part;

•        to consider and cast an advisory (non-binding) vote on a proposal to approve the compensation that may be paid or become payable to National Western’s named executive officers that is based on or otherwise relates to the proposed merger; and

•        to vote on a proposal to approve the adjournment of the Special Meeting to a later date or dates, if necessary or appropriate, to solicit additional proxies in the event there are not sufficient votes at the time of the Special Meeting to approve the first proposal listed above.

National Western will transact no other business at the Special Meeting except such business as may properly be brought before the Special Meeting or any adjournment or postponement thereof. Please refer to the proxy statement of which this notice is a part for further information with respect to the business to be transacted at the Special Meeting.

The National Western board of directors has fixed the close of business on November 27, 2023 as the record date for the Special Meeting. Only National Western stockholders of record on the record date are entitled to receive notice of, and to vote at, the Special Meeting or any adjournment or postponement thereof. A complete list of such stockholders will be available at 10801 N. Mopac Expy, Bldg. 3, Austin, Texas 78759 for inspection by any National Western stockholder for any purpose germane to the Special Meeting during ordinary business hours for the ten days preceding the Special Meeting. The eligible National Western stockholder list will also be available at the Special Meeting for examination by any stockholder present at such meeting.

The enclosed proxy statement provides a detailed description of the merger and the merger agreement and the other matters to be considered at the Special Meeting. We urge you to read the proxy statement carefully its entirety, including the Annexes and any documents incorporated by reference into the proxy statement. If you have any questions concerning the merger or the proxy statement, would like additional copies or need help voting your shares of Company common stock, please contact National Western’s proxy solicitor:

MacKenzie Partners Inc.
1407 Broadway, 27th Floor
New York, NY 10018
proxy@mackenziepartners.com
Stockholders, please call toll free: (800) 322-2885
Banks and Brokerage Firms, please call collect: (212) 929-5500

TABLE OF CONTENTS

QUESTIONS AND ANSWERS

The following are some questions that you, as a National Western stockholder, may have regarding the merger and the other matters being considered at the Special Meeting and the answers to those questions. National Western urges you to carefully read the remainder of this proxy statement, including the documents incorporated by reference and the Annexes attached to this proxy statement in their entirety because the information in this section does not provide all of the information that might be important to you with respect to the merger agreement, the merger and the other matters being considered at the Special Meeting.

Q:     Why am I receiving this proxy statement?

A:     Parent and National Western have agreed to a business combination pursuant to the terms of the merger agreement that is described in this proxy statement. A copy of the merger agreement is included in this proxy statement as Annex A.

In order to complete the merger, among other conditions, National Western stockholders must adopt the merger agreement.

National Western will hold the Special Meeting to obtain this approval from its stockholders. This proxy statement, including its Annexes, contains or incorporates by reference important information about National Western, the merger and the Special Meeting. This proxy statement also contains important information about Parent. You should read all of the available information carefully and in its entirety.

Q:     What effect will the merger have on the Company?

A:     If the merger is completed, Merger Sub will be merged with and into the Company, with the Company continuing as the surviving entity, which will become a direct, wholly-owned subsidiary of Parent. Following the consummation of the merger, the Class A common stock will be delisted and will no longer be traded on the NASDAQ or any other public market and the registration of the Class A common stock under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) will be terminated. Upon the consummation of the merger, the Company’s certificate of incorporation will be amended and restated to update the registered office and total number of authorized shares of the Company and delete certain other provisions in connection with the Company’s no longer being publicly traded or registered under the Exchange Act.

Q:     What will I receive in the merger?

A:     If the merger is completed and you hold your shares of Company common stock as of the effective time, you will receive $500.00 in cash, without interest and less any applicable withholding taxes, for each share of Company common stock that you own, unless you properly demand appraisal of such shares in accordance with Section 262 of the DGCL and you do not waive, withdraw, or otherwise lose your rights to appraisal under Section 262 of the DGCL. For example, if you own 100 shares of Company common stock, you will receive $50,000 in cash in exchange for your shares of Company common stock, less any applicable withholding taxes. After the completion of the merger, you will not own shares in the surviving corporation.

Q:     When do you expect the merger to be completed?

A:     The merger is expected to close in the first half of 2024. However, the consummation of the merger is subject to the receipt of necessary government and regulatory approvals in certain jurisdictions, including Colorado, Missouri and Arizona, and the approval of FINRA, as well as other conditions set forth in the merger agreement, including antitrust clearance (or termination of the applicable waiting period) from the Antitrust Division or FTC. Accordingly, the Company cannot provide assurance the merger will be completed on the terms or timeline currently contemplated, or at all.

Q:     What happens if the merger is not completed?

A:     If the merger is not completed for any reason, the Company’s stockholders will not receive any payment for their shares of Company common stock in connection with the merger. Instead, the Company will remain a publicly traded company, and the shares of Company common stock will continue to be traded on the NASDAQ. Under specified circumstances, if the merger agreement is terminated, the Company may be required to pay Parent the Company termination fee.

Q:     When and where will the Special Meeting be held?

A:     The Special Meeting will be held at Moody Gardens Hotel at Seven Hope Boulevard, Galveston, Texas 77554 on January 8, 2024, at 9:00 a.m., Galveston time.

Q:     Who is entitled to vote at the Special Meeting?

A:     The record date for the Special Meeting is November 27, 2023. Only record holders of shares of Company common stock at the close of business on such date are entitled to notice of, and to vote at, the Special Meeting or any adjournment or postponement thereof.

Q:     What constitutes a quorum at the Special Meeting?

A:     Stockholders who hold shares representing at least a majority of the outstanding voting power of all issued and outstanding shares of Company common stock entitled to vote at the Special Meeting must be present in person or represented by proxy to constitute a quorum.

Additional information on the quorum requirements can be found under “The Special Meeting — Quorum” on page 21.

Q:     Should I send in my Company common stock certificates now?

A:     No. You will be sent a letter of transmittal with related instructions by a paying agent after completion of the merger, describing how you may exchange your shares of Company common stock for the merger consideration. Please do NOT return your Company common stock certificate(s) to the Company. Holders of uncertificated shares of Company common stock (i.e., holders of book-entry shares) will, after submitting a properly completed letter of transmittal to the paying agent, automatically receive the merger consideration, without interest and less any applicable withholding taxes, without any further action required on the part of those holders.

Q:     Is the merger subject to the fulfillment of certain conditions?

A:     Yes. Before the merger can be completed, the Company, Parent and Merger Sub must fulfill or, if permissible, waive several closing conditions. If these conditions are not satisfied or waived, the merger will not be completed. See the section titled “The Merger Agreement — Conditions to Consummation of the Merger” beginning on page 81 for more information.

Q:     What is the market price of Company common stock?

A:     The closing sale price of the shares of Class A common stock on November 29, 2023, the most recent practicable date before the date of this proxy statement, was $479.94 per share. You are encouraged to obtain current market quotations for shares of the Company common stock. See the section titled “Market Prices and Dividend Data” beginning on page 92. The Class B common stock is held by two stockholders and is not traded on any stock exchange.

Q:     Do any of the Company’s directors or executive officers have interests in the merger that may differ from those of Company stockholders generally?

A:     You should be aware that the Company’s directors and executive officers have interests in the merger that may be different from, or in addition to, the interests of the Company stockholders generally. These interests are described in more detail in the section titled “The Merger — Interests of National Western Directors and Executive Officers in the Merger” beginning on page 54. The National Western board of directors was aware of these interests and considered them, among other matters, in evaluating and unanimously approving the merger agreement.

Q:     How do I vote if I am a stockholder of record?

A:     If you were a record holder of Company common stock at the close of business on the record date for the Special Meeting, you may vote in person by attending the Special Meeting or, to ensure that your shares are represented at the Special Meeting, you may vote or authorize a proxy to vote using one or more of the following methods:

•        Internet.    You may submit a proxy electronically on the Internet by following the instructions at www.proxyvote.com. You will need the control number that appears on your proxy card to vote online. Internet voting facilities will be available 24 hours a day and will close at 11:59 p.m., Eastern Time, on the day prior to the Special Meeting.

•        Telephone.    You may submit a proxy by telephone (from U.S. and Canada only) using the toll-free number:                   . The telephone number is toll free, at no charge to National Western stockholders. Please have your proxy card in hand when you call. Telephone voting facilities will be available 24 hours a day and will close at 11:59 p.m., Eastern Time, on the day prior to the Special Meeting. An agent will be available to answer questions from 8:00 a.m. through 8:00 p.m., Eastern Time, Monday through Friday.

•        Mail.    You may indicate your vote by completing, signing and dating your proxy card and returning it in the enclosed reply envelope.

•        In person.    You may vote in person at the Special Meeting by completing a ballot; however, attending the meeting without completing a ballot will not count as a vote.

If you hold National Western shares in “street name” through a bank, broker or other nominee, please follow the voting instructions provided by your bank, broker or other nominee to ensure that your shares are represented at the Special Meeting.

Q:     My shares are held in “street name” by my bank, broker or other nominee. Will my bank, broker or other nominee automatically vote my shares for me?

A:     No. If your shares are held through a bank, broker or other nominee, you are considered the “beneficial holder” of the shares held for you in what is known as “street name.” The “record holder” of such shares is your bank, broker or other nominee, and not you. If this is the case, this proxy statement has been forwarded to you by your bank, broker or other nominee. You must provide the record holder of your shares with instructions on how to vote your shares. Otherwise, your bank, broker or other nominee may not vote your shares on any of the proposals to be considered at the Special Meeting, and a broker non-vote will result.

In connection with the Special Meeting, broker non-votes will have:

•        the same effect as a vote “AGAINST” the proposal to adopt the merger agreement;

•        no effect on the proposal to approve, on an advisory (non-binding) basis, the compensation that may be paid or become payable to National Western’s named executive officers that is based on or otherwise relates to the proposed merger; and

•        no effect on the proposal to approve the adjournment of the Special Meeting, if necessary or appropriate, to permit further solicitation of proxies in favor of the proposal to adopt the merger agreement.

Please follow the voting instructions provided by your bank, broker or other nominee so that it may vote your shares on your behalf. Please note that you may not vote shares held in street name by returning a proxy card directly to National Western or by voting in person at the Special Meeting unless you first obtain a “legal proxy” from your bank, broker or other nominee.

Q:     How many votes do I have?

A:     With respect to each proposal to be presented at the Special Meeting, holders of Company common stock as of the record date are entitled to one vote for each share of Company common stock owned at the close of business on the record date. At the close of business on the record date, there were 3,436,020.1428 shares of Class A common stock outstanding and entitled to vote at the Special Meeting and 200,000 shares of Class B common

stock outstanding and entitled to vote at the Special Meeting. At the Special Meeting the holders of shares of Class A common stock and Class B common stock will vote together as a single class on each matter submitted to the Company’s stockholders for a vote.

Q:     What vote is required to approve each proposal?

A:     The adoption of the merger agreement requires the affirmative vote of the holders of a majority of the combined voting power of the issued and outstanding shares of Class A common stock and Class B common stock, voting together as a single class. Failures to vote, broker non-votes and abstentions will have the same effect as a vote “AGAINST” the approval of such proposal.

The approval, on an advisory (non-binding) basis, of the compensation that may be paid or become payable to National Western’s named executive officers that is based on or otherwise relates to the proposed merger requires the affirmative vote of the holders of a majority of the shares of Class A common stock and Class B common stock, voting together as a single class, present, in person or by proxy, at the Special Meeting and entitled to vote on the proposal, assuming there is a quorum at the Special Meeting. If you attend the Special Meeting or are represented by proxy and, in either case, abstain from voting, that abstention will have the same effect as voting “AGAINST” this proposal. Failures to vote and broker non-votes will have no effect on the vote for this proposal.

The adjournment of the Special Meeting, if necessary or appropriate, to solicit additional proxies in favor of the proposal to adopt the merger agreement requires the affirmative vote of the holders of a majority of the shares of Class A common stock and Class B common stock, voting together as a single class, present, in person or by proxy, at the Special Meeting and entitled to vote on the proposal, assuming there is a quorum at the Special Meeting. If you attend the Special Meeting or are represented by proxy and, in either case, abstain from voting, that abstention will have the same effect as voting “AGAINST” this proposal. Failures to vote and broker non-votes will have no effect on the vote for this proposal.

Q:     How does the National Western board of directors recommend that National Western stockholders vote?

A:     The National Western board of directors has unanimously adopted and approved the merger agreement and determined that, on the terms and subject to the conditions set forth in the merger agreement, the merger agreement and the transactions contemplated thereby, including the merger, are advisable, fair to and in the best interests of National Western and its stockholders. Accordingly, the National Western board of directors unanimously recommends that National Western stockholders vote:

•        “FOR” the proposal to adopt the merger agreement;

•        “FOR” the proposal to approve, on an advisory (non-binding) basis, the compensation that may be paid or become payable to National Western’s named executive officers that is based on or otherwise relates to the proposed merger; and

•        “FOR” the proposal to approve the adjournment of the Special Meeting, if necessary or appropriate, to permit further solicitation of proxies in favor of the proposal to adopt the merger agreement.

Q:     What will happen if I return my proxy card without indicating how to vote?

A:     If you properly complete and sign your proxy card but do not indicate how your shares of Company common stock should be voted on a proposal, the shares of Company common stock represented by your proxy will be voted as the National Western board of directors recommends and, therefore,

•        “FOR” the proposal to adopt the merger agreement;

•        “FOR” the proposal to approve, on an advisory (non-binding) basis, the compensation that may be paid or become payable to National Western’s named executive officers that is based on or otherwise relates to the proposed merger; and

•        “FOR” the proposal to approve the adjournment of the Special Meeting, if necessary or appropriate, to permit further solicitation of proxies in favor of the proposal to adopt the merger agreement.

Q:     Can I change my vote or revoke my proxy after I have returned a proxy or voting instruction card?

A:     Yes. If you are the record holder of Company common stock, you can change your vote or revoke your proxy at any time before your proxy is voted at the Special Meeting. You can do this by:

•        timely delivering a signed written notice of revocation;

•        timely delivering a new, valid proxy bearing a later date (including by telephone or through the internet); or

•        attending the Special Meeting and voting in person, which will automatically cancel any proxy previously given, or revoking your proxy in person. Simply attending the Special Meeting without voting will not revoke any proxy that you have previously given or change your vote.

If you choose either of the first two methods, your notice of revocation or your new proxy must be received by the Secretary of National Western no later than the beginning of the Special Meeting.

Regardless of the method used to deliver your previous proxy, you may revoke your proxy by any of the above methods.

If you hold shares of National Western in “street name,” you must contact your bank, broker or other nominee to change your vote.

Q:     What are the expected material U.S. federal income tax consequences of the merger to a U.S. holder of Company common stock?

A:     The receipt of the merger consideration by a U.S. holder (as such term is defined below under “U.S. Federal Income Tax Consequences of the Merger”) of cash in exchange for shares of Company common stock pursuant to the merger will be a fully taxable transaction for U.S. federal income tax purposes. In general, a U.S. holder who receives the merger consideration in exchange for shares of Company common stock pursuant to the merger will recognize capital gain or loss for U.S. federal income tax purposes equal to the difference, if any, between (i) the amount of cash received and (ii) the U.S. holder’s adjusted tax basis in its shares of Company common stock.

For a more detailed discussion of the material U.S. federal income tax consequences of the merger to U.S. holders of Company common stock, see the section titled “U.S. Federal Income Tax Consequences of the Merger” beginning on page 7. Tax matters can be complicated, and the tax consequences of the merger to you will depend on your particular tax situation. You are encouraged to consult your tax advisor to determine the tax consequences of the merger to you.

Q:     How will I receive the merger consideration to which I am entitled?

A:     You will be paid the merger consideration as promptly as practicable after the effective time and after receipt by the paying agent of your stock certificates (or evidence of shares in book-entry form), a duly executed letter of transmittal and any additional documents required by the procedures set forth in the form of letter of transmittal. No interest will be paid or accrued on the cash amounts received as merger consideration. See “The Merger Agreement — Exchange Procedures” beginning on page 68.

Q:     Why are holders of shares of Company common stock being asked to cast an advisory (non-binding) vote to approve the compensation that may be paid or become payable to National Western’s named executive officers that is based on or otherwise relates to the proposed merger?

A:      Section 14A of the Exchange Act and the applicable SEC rules thereunder, which were implemented as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, require the Company to seek an advisory (non-binding) vote with respect to certain payments that will or may be made to the Company’s named executive officers that are based on or otherwise relate to the proposed merger. The compensation advisory proposal is intended to satisfy this requirement. See the sections of this proxy statement titled “The Merger — Interests of National Western Directors and Executive Officers in the Merger” and “Proposals for the Special Meeting — National Western Proposal 2 — Advisory (Non-Binding) Vote on Compensation” beginning on page 54 and page 86, respectively, for additional information, including more details on such payments. Compensation, if any, that may become payable by Parent to the Company’s named executive officers in connection with any such named executive officer’s continued service with Parent following the effective time is not subject to this advisory (non-binding) vote.

Q:     What will happen if the holders of shares of Company common stock do not approve the advisory (non-binding) compensation advisory proposal?

A:     The vote to approve the advisory (non-binding) compensation advisory proposal is a vote separate and apart from the vote to adopt the merger agreement. Approval of the advisory (non-binding) compensation advisory proposal is not a condition to completion of the merger and is advisory in nature only, meaning that it will not be binding on the Company or Parent or any of their respective subsidiaries. Accordingly, if the Company’s stockholders approve the merger proposal and the merger is consummated, the compensation that is based on or otherwise relates to the merger will or may be payable to the Company’s named executive officers in accordance with the terms of the underlying compensation agreements and arrangements, even if this proposal is not approved.

Q:     Should I send in my share certificates now?

A:     No. After the merger is completed, you will receive transmittal materials from the paying agent for the merger with detailed written instructions for exchanging your shares of Company common stock for the consideration to be paid to former National Western stockholders in connection with the merger. If you are the beneficial owner of shares of Company common stock held in “street name,” you may receive instructions from your broker, bank or other nominee as to what action, if any, you need to take to effect the surrender of such shares.

Q:     Are National Western stockholders entitled to appraisal rights?

A:     Yes. Under Delaware law, if the merger is completed, in lieu of receiving the merger consideration provided by the merger agreement, holders of record of Company common stock who do not vote in favor of adopting the merger agreement will have the right to demand appraisal of the fair value of their shares by the Delaware Court of Chancery and to receive a cash payment of the amount determined by the Court of Chancery as the fair value, together with interest on that amount from the effective time until such payment is made. In order to exercise your appraisal rights, you must follow the requirements set forth in Section 262 of the DGCL. Appraisal rights will be available only to holders of Company common stock who deliver a written demand for appraisal to National Western prior to the vote on the proposal to adopt the merger agreement at the Special Meeting and who comply with the procedures and requirements set forth in Section 262 of the DGCL. These procedures and requirements are summarized in this proxy statement. The appraisal amount could be more than, the same as or less than the amount a stockholder would be entitled to receive under the terms of the merger agreement. A copy of Section 262 of the DGCL is included as Annex C to this proxy statement. For additional information, see the section titled “Appraisal Rights” beginning on page 88.

Q:     What happens if I sell or otherwise transfer my shares of Company common stock before completion of the merger?

A:     If you sell or otherwise transfer your shares of Company common stock, you will have transferred to the person that acquires your shares of Company common stock the right to receive the merger consideration and, to the extent you took steps to preserve your right to appraisal, lose your appraisal rights with respect to the transferred shares. To receive the merger consideration or exercise your appraisal rights, you must hold your shares of Company common stock as of the effective time.

Q:     What does it mean if I receive more than one set of materials?

A:     This means you own shares of Company common stock that are registered under different names. For example, you may own some shares directly as a stockholder of record and other shares through a bank, broker or other nominee or you may own shares through more than one bank, broker or other nominee. In these situations, you will receive multiple sets of proxy materials. You must complete, sign and return all of the proxy cards or follow the instructions for any alternative voting procedure on each of the voting instruction forms you receive in order to vote all of the shares of Company common stock that you own. Each proxy card you receive will come with its own self-addressed, stamped envelope; if you submit your proxy by mail, make sure you return each proxy card in the return envelope that accompanied that proxy card.

Q:     How can I find out more information?

A:     For more information about Parent and National Western, as well as about the merger agreement, the merger and the Special Meeting, see the section titled “Where You Can Find More Information” beginning on page 99.

Q:     Who can help answer my questions?

A:     National Western stockholders who have questions about the merger, the other matters to be voted on at the Special Meeting, or how to submit a proxy or desire additional copies of this proxy statement or additional proxy cards should contact to National Western’s proxy solicitor, MacKenzie Partners Inc. (“MacKenzie”), at 1407 Broadway, 27th Floor, New York, NY 10018 or by telephone at (800) 322-2885 (toll-free) for stockholders and (212) 929-5500 (collect call) for banks and brokers.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This proxy statement and the other documents referenced herein may contain or incorporate by reference information that includes or is based upon forward-looking statements (including “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995) with respect to the merger, the financial condition, results of operations and business of the Company, and certain plans and objectives of the National Western board of directors.

Forward-looking statements generally are indicated by words such as “expects,” “estimates,” “intends,” “anticipates,” “plans,” “goal,” “believes,” “will,” “should,” “would,” “could,” “seek,” “continue,” or words of similar meaning, and include, without limitation, statements regarding the outlook of our business and expected financial performance, and statements relating to the COVID-19 pandemic and its effects on the Company. These forward-looking statements are subject to changes and uncertainties that are, in many instances, beyond our control and have been made based upon our assumptions, expectations and beliefs concerning future developments and their potential effect upon us. There can be no assurance that future developments will be in accordance with our expectations, that the effect of future developments on us will be as anticipated, or that our risk management policies and procedures will be effective, particularly given the uncertainty relating to the COVID-19 pandemic. We do not make public specific projections relating to future earnings, and we do not endorse any projections regarding future performance made by others. Additionally, we do not publicly update or revise forward-looking statements based on the outcome of various foreseeable or unforeseeable events. Forward-looking statements are not guarantees of future performance and involve various risks and uncertainties. Although the Company believes the expectations contained in its forward-looking statements are reasonable, it can give no assurance that such expectations will prove correct. There are certain important factors that could cause actual results to differ, possibly materially, from expectations or estimates reflected in such forward-looking statements, including without limitation risks, uncertainties and other factors discussed in Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2020 filed with the SEC on March 4, 2023 and elsewhere in this proxy statement. All statements other than statements of historical or current facts included in this proxy statement are forward-looking statements. Important factors that could cause actual results and outcomes to differ materially from those in the forward-looking statements include, but are not limited to those summarized below:

•        conditions to the closing of the merger may not be satisfied;

•        regulatory approvals required for the closing of the merger may not be obtained, or required regulatory approvals may delay the merger or result in the imposition of conditions that could have a material adverse effect on the Company or Parent or cause certain conditions to closing not to be satisfied, which could result in the termination of the merger agreement;

•        the timing of completion of the merger is uncertain;

•        the business of the Company or Parent could suffer as a result of uncertainty surrounding the merger;

•        events, changes or other circumstances could occur that could give rise to the termination of the merger agreement;

•        there are risks related to disruption of management’s attention to the ongoing business operations of the Company or Parent due to the pending merger;

•        the announcement or pendency of the merger could affect the relationships of the Company or Parent with their clients, operating results and business generally, including on our ability to retain employees;

•        the outcome of any legal proceedings initiated against the Company or Parent following the announcement of the merger could adversely affect the Company or Parent, including their ability to consummate the merger;

•        the Company or Parent may be adversely affected by other economic, business, and/or competitive factors as well as management’s response to any of the aforementioned factors; and

•        other risks detailed in our filings with the SEC, including “Item 1A. Risk Factors” in our Annual Report on Form 10-K for our fiscal year ended December 31, 2022. See the section titled “Where You Can Find More Information” beginning on page 99.

All forward-looking statements described herein are qualified by these cautionary statements, and there can be no assurance that the actual results, events or developments referenced herein will occur or be realized. The foregoing review of important factors related to the pending merger should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included herein and elsewhere, including the risk factors included in the Company’s most recent Quarterly Report on Form 10-Q and Annual Report on Form 10-K and other documents of the Company on file with the SEC. Neither the Company nor Parent undertakes any obligation to update, correct or otherwise revise any forward-looking statements. All subsequent written and oral forward-looking statements attributable to the Company or Parent and/or any person acting on behalf of either of them are expressly qualified in their entirety by this paragraph. The information contained on any websites referenced in this proxy statement or the Company’s Forms 10-K and Forms 10-Q is not incorporated by reference into this proxy statement.

THE PARTIES TO THE MERGER AGREEMENT

The Company

National Western Life Group, Inc.
10801 N. Mopac Expy, Bldg. 3
Austin, Texas 78759
Attention: Rey Perez and Gina Byrne Miller
Telephone: (512) 836-1010

The Company, incorporated in the State of Delaware, is the parent organization of National Western Life, which is the parent organization of Ozark National Life, both stock life insurance companies in aggregate offering a broad portfolio of individual universal life, whole life and term insurance plans, as well as annuity products. At June 30, 2023, the Company maintained consolidated total assets of $12.5 billion, consolidated stockholders’ equity of $2.3 billion, and combined life insurance in force of $18.9 billion. The National Western companies operate in all 50 states. Additional information regarding the Company is contained in our filings with the SEC, copies of which may be obtained without charge by following the instructions in the section titled “Where You Can Find More Information” beginning on page 99.

Shares of Class A common stock trade on the NASDAQ under the symbol “NWLI.” The Class B common stock is held by two stockholders and is not traded on any stock exchange.

Parent

S. USA Life Insurance Company, Inc.
1 Pennsylvania Plaza
New York, NY 10119
Attention: Nicholas von Moltke and Scott Silverman
Telephone: (212) 356-0300

Parent is an Arizona-domiciled life insurance company and is an affiliate of Prosperity Life Group, an insurance, reinsurance, and asset management company. Together, Prosperity Life Group’s underwriting company affiliates — SBLI USA Life Insurance Company, Inc., S. USA Life Insurance Company, Inc., and Shenandoah Life Insurance Company — have been helping individuals and their families since 1916 by providing life insurance, asset accumulation, and supplemental health products to help them achieve their goals. Affiliate Prosperity Asset Management is an insurance-focused asset manager specializing in structured credit and niche asset opportunities and origination platforms.

Only SBLI USA Life Insurance Company, Inc. is an authorized New York insurer. S. USA Life Insurance Company, Inc. and Shenandoah Life Insurance Company are not authorized as insurers in, and do not do insurance business in, New York. Each underwriting company is responsible for its own financial and contractual obligations. SBLI USA Life Insurance Company, Inc. is not affiliated with The Savings Bank Mutual Life Insurance Company of Massachusetts.

Merger Sub

PGH Merger Inc.
c/o S. USA Life Insurance Company, Inc.
1 Pennsylvania Plaza
New York, NY 10119
Attention: Nicholas von Moltke and Scott Silverman
Telephone: (212) 356-0300

Merger Sub is a Delaware corporation that is a direct, wholly-owned subsidiary of Parent. Merger Sub was formed specifically for the merger and conducts no other business. At the closing of the merger, Merger Sub will be merged with and into the Company, with the Company surviving as a direct, wholly-owned subsidiary of Parent.

THE SPECIAL MEETING

This proxy statement is being provided to the National Western stockholders as part of a solicitation of proxies by the National Western board of directors for use at the Special Meeting to be held at the time and place specified below and at any properly convened meeting following an adjournment or postponement thereof. This proxy statement provides National Western stockholders with information they need to know to be able to vote or instruct their vote to be cast at the Special Meeting.

Date, Time and Place

The Special Meeting will be held at Moody Gardens Hotel at Seven Hope Boulevard, Galveston, Texas 77554 on January 8, 2024, at 9:00 a.m., Galveston time.

Purpose of the Special Meeting

At the Special Meeting, National Western stockholders will be asked to consider and vote on the following:

•        a proposal to adopt the merger agreement, which is further described in the sections titled “The Merger” and “The Merger Agreement” beginning on pages 25 and 67, respectively;

•        an advisory (non-binding) proposal to approve the compensation that may be paid or become payable to National Western’s named executive officers that is based on or otherwise relates to the proposed merger; and

•        a proposal to approve the adjournment of the Special Meeting to a later date or dates, if necessary or appropriate, to solicit additional proxies in the event there are not sufficient votes at the time of the Special Meeting to approve the first proposal listed above.

Completion of the merger is conditioned on the adoption of the merger agreement by the National Western stockholders.

Recommendation of the National Western Board of Directors

At a special meeting held on October 8, 2023, the National Western board of directors adopted and approved the merger agreement and determined that, on the terms and subject to the conditions set forth in the merger agreement, the merger agreement and the transactions contemplated thereby, including the merger, are advisable, fair to and in the best interests of National Western and its stockholders. Accordingly, the National Western board of directors unanimously recommends that National Western stockholders vote:

•        “FOR” the proposal to adopt the merger agreement;

•        “FOR” the proposal to approve, on an advisory (non-binding) basis, the compensation that may be paid or become payable to National Western’s named executive officers that is based on or otherwise relates to the proposed merger; and

•        “FOR” the proposal to approve the adjournment of the Special Meeting, if necessary or appropriate, to permit further solicitation of proxies in favor of the proposal to adopt the merger agreement.

National Western stockholders should carefully read this proxy statement, including any documents incorporated by reference, and the Annexes in their entirety for more detailed information concerning the merger and the other transactions contemplated by the merger agreement.

National Western Record Date; Stockholders Entitled to Vote

The record date for the Special Meeting is November 27, 2023. Only record holders of shares of Company common stock at the close of business on such date are entitled to notice of, and to vote at, the Special Meeting or any adjournment or postponement thereof. At the close of business on the record date, the only outstanding voting securities of National Western were 3,436,020.1428 shares of Class A common stock and 200,000 shares of Class B common stock. A list of the National Western stockholders of record who are entitled to vote at the Special Meeting will be available at 10801 N. Mopac Expy, Bldg. 3, Austin, Texas 78759 for inspection by any National Western stockholder

for any purpose germane to the Special Meeting during ordinary business hours for the ten days preceding the Special Meeting and will also be available at the Special Meeting for examination by any National Western stockholder present at such meeting.

Each share of Company common stock outstanding on the record date of the Special Meeting is entitled to one vote on each proposal and any other matter coming before the Special Meeting.

Voting by National Western’s Directors and Executive Officers

At the close of business on the record date of the Special Meeting, National Western directors and executive officers were entitled to vote 599,476 shares of Class A common stock, or approximately 16.5% of the total combined number of shares of Class A common stock and Class B common stock outstanding on that date.

Quorum

No business may be transacted at the Special Meeting unless a quorum is present. Stockholders who hold shares representing at least a majority of the outstanding voting power of all issued and outstanding shares of Class A common stock and Class B common stock entitled to vote at the Special Meeting must be present in person or represented by proxy to constitute a quorum. If a quorum is not present, to allow additional time for obtaining additional proxies, the Special Meeting will be adjourned to solicit additional proxies in favor of the proposal to adopt the merger agreement. Additionally, if fewer shares are voted in favor of the proposal to adopt the merger agreement than is required, to allow additional time for obtaining additional proxies, the Special Meeting may be adjourned to solicit additional proxies in favor of the proposal to adopt the merger agreement. National Western’s bylaws permit the chair of the meeting to adjourn the meeting without a stockholder vote, regardless of whether a quorum is present. No notice of an adjourned meeting need be given unless the adjournment is for more than 30 days or, if after the adjournment, a new record date is fixed for the adjourned meeting, in which case a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting. At any adjourned meeting, all proxies will be voted in the same manner as they would have been voted at the original convening of the Special Meeting, except for any proxies that have been effectively revoked or withdrawn prior to the adjourned meeting.

All shares of Company common stock represented at the Special Meeting, including shares that are represented but that vote to abstain, will be treated as present for purposes of determining the presence or absence of a quorum. Broker non-votes will have no effect on determining the presence or absence of a quorum at the Special Meeting.

Required Vote

The required votes to approve the National Western proposals are as follows:

•        The adoption of the merger agreement requires the affirmative vote of the holders of a majority of the issued and outstanding shares of Class A common stock and Class B common stock, voting together as a single class. Each share of Company common stock outstanding on the record date of the Special Meeting is entitled to one vote on this proposal. Failures to vote, broker non-votes and abstentions will have the same effect as a vote “AGAINST” the approval of such proposal.

•        The approval, on an advisory (non-binding) basis, of the compensation that may be paid or become payable to National Western’s named executive officers that is based on or otherwise relates to the proposed merger requires the affirmative vote of the holders of a majority of the shares of Class A common stock and Class B common stock, voting together as a single class, present, in person or by proxy, at the Special Meeting and entitled to vote on the proposal, assuming there is a quorum at the Special Meeting. Each share of Company common stock outstanding on the record date of the Special Meeting is entitled to one vote on this proposal. If you attend the Special Meeting or are represented by proxy and, in either case, abstain from voting, that abstention will have the same effect as voting “AGAINST” this proposal. Failures to vote and broker non-votes will have no effect on the vote for this proposal.

•        The adjournment of the Special Meeting, if necessary or appropriate, to solicit additional proxies requires the affirmative vote of the holders of a majority of the shares of Class A common stock and Class B common stock, voting together as a single class, present, in person or by proxy, at the Special Meeting and entitled to vote on the proposal, assuming there is a quorum at the Special Meeting. Each share of Company common stock outstanding on the record date of the Special Meeting is entitled to one vote on

this proposal. If you attend the Special Meeting or are represented by proxy and, in either case, abstain from voting, that abstention will have the same effect as voting “AGAINST” this proposal. Failures to vote and broker non-votes will have no effect on the vote for this proposal. National Western’s bylaws permit the chair of the meeting to adjourn the meeting without a stockholder vote, regardless of whether a quorum is present.

Granting of Proxies by Holders of Record

If you were a record holder of Company common stock at the close of business on the record date of the Special Meeting, a proxy card is enclosed for your use. National Western requests that you submit your proxy as promptly as possible by (i) accessing the internet site listed on the National Western proxy card, (ii) calling the toll-free number listed on the National Western proxy card or (iii) submitting your National Western proxy card by mail by using the provided self-addressed, stamped envelope. Information and applicable deadlines for submitting a proxy through the internet or by telephone are set forth on the enclosed proxy card. When the accompanying proxy is returned properly executed, the shares of Company common stock represented by it will be voted at the Special Meeting or any adjournment or postponement thereof in accordance with the instructions contained in the proxy card. Your internet or telephone submission authorizes the named proxies to vote your shares in the same manner as if you had marked, signed and returned a proxy card.

If a proxy is returned without an indication as to how the shares of Company common stock represented are to be voted with regard to a particular proposal, the Company common stock represented by the proxy will be voted in accordance with the recommendation of the National Western board of directors and, therefore,

•        “FOR” the proposal to adopt the merger agreement;

•        “FOR” the proposal to approve, on an advisory (non-binding) basis, the compensation that may be paid or become payable to National Western’s named executive officers that is based on or otherwise relates to the proposed merger; and

•        “FOR” the proposal to approve the adjournment of the Special Meeting, if necessary or appropriate, to permit further solicitation of proxies in favor of the proposal to adopt the merger agreement.

At the date hereof, the National Western board of directors has no knowledge of any business that will be presented for consideration at the Special Meeting and that would be required to be set forth in this proxy statement or the related proxy card other than the matters set forth in National Western’s notice of special meeting of stockholders. If any other matter is properly presented at the Special Meeting for consideration, it is intended that the persons named in the enclosed form of proxy and acting thereunder will vote in accordance with their best judgment on such matter.

Your vote is important. Accordingly, if you were a record holder of Company common stock on the record date of the Special Meeting, please sign and return the enclosed proxy card or submit your proxy via the internet or telephone regardless of whether you plan to attend the Special Meeting in person. Proxies submitted through the specified internet website or by phone must be received by 11:59 p.m., Eastern Time, on January 7, 2024, the day before the Special Meeting.

Shares Held in Street Name

If you hold shares of Company common stock through a broker, bank or other nominee, you are considered the “beneficial holder” of the shares held for you in what is known as “street name.” The “record holder” of such shares is your broker, bank or other nominee, and not you, and you must provide the record holder of your shares with instructions on how to vote your shares. Please follow the voting instructions provided by your broker, bank or other nominee. Please note that you may not vote shares held in street name by returning a proxy card directly to National Western or by voting in person at the Special Meeting unless you have a “legal proxy,” which you must obtain from your broker, bank or other nominee. Furthermore, brokers, banks or other nominees who hold shares of Company common stock on behalf of their customers may not give a proxy to National Western to vote those shares without specific instructions from their customers.

If you are a National Western stockholder and you do not instruct your broker, bank or other nominee on how to vote your shares, your broker, bank or other nominee may not vote your shares on any of the National Western proposals.

Voting in Person

If you plan to attend the Special Meeting and wish to vote in person, you will be given a ballot at the Special Meeting. If you are a registered stockholder, please be prepared to provide proper identification, such as a driver’s license, at the Special Meeting. If your shares are held in “street name,” you must bring to the Special Meeting a “legal proxy” executed in your favor from the record holder (your broker, bank or other nominee) of the shares authorizing you to vote at the Special Meeting.

Revocation of Proxies

If you are the record holder of Company common stock, you can change your vote or revoke your proxy at any time before your proxy is voted at the Special Meeting. You can do this by:

•        timely delivering a signed written notice of revocation;

•        timely delivering a new, valid proxy bearing a later date (including by telephone or through the internet); or

•        attending the Special Meeting and voting in person, which will automatically revoke any proxy previously given, or revoking your proxy in person. Simply attending the Special Meeting without voting will not revoke any proxy that you have previously given or change your vote.

A registered stockholder may revoke a proxy by any of these methods, regardless of the method used to deliver the stockholder’s previous proxy. Written notices of revocation and other communications with respect to the revocation of proxies should be addressed as follows:

National Western Life Group, Inc.
10801 N. Mopac Expy, Bldg. 3
Austin, Texas 78759
(512) 836-1010
Attention: Corporate Secretary

If your shares are held in “street name” through a broker, bank or other nominee, you may change your voting instructions by submitting new voting instructions to your broker, bank or nominee in accordance with its established procedures. If your shares are held in the name of a broker, bank or other nominee and you decide to change your vote by attending the Special Meeting and voting in person, your vote in person at the Special Meeting will not be effective unless you have obtained and present an executed “legal proxy” in your favor from the record holder (your broker, bank or nominee).

Tabulation of Votes

National Western has appointed Gina Byrne Miller, the Company’s Senior Vice President, Chief Legal Officer and Corporate Secretary, to serve as the Inspector of Votes for the Special Meeting. Ms. Miller will independently tabulate affirmative and negative votes and abstentions.

Solicitation of Proxies

National Western is soliciting proxies for the Special Meeting from its stockholders. In accordance with the merger agreement, National Western will pay its own cost of soliciting proxies, including the cost of mailing this proxy statement, from its stockholders. In addition to solicitation of proxies by mail, proxies may be solicited by National Western’s officers, directors and regular employees, without additional remuneration, by personal interview, telephone or other means of communication.

National Western will make arrangements with brokerage houses, custodians, nominees and fiduciaries to forward proxy solicitation materials to beneficial owners of Company common stock. National Western may reimburse these brokerage houses, custodians, nominees and fiduciaries for their reasonable expenses incurred in forwarding the proxy materials.

To help ensure the presence in person or by proxy of the largest number of stockholders possible, National Western has engaged MacKenzie, a proxy solicitation firm, to solicit proxies on National Western’s behalf. In the event of a contested solicitation or public opposition to the merger, National Western and MacKenzie will mutually agree on an appropriate final fee based upon customary fees for the proxy solicitation services that MacKenzie provides. If there is no contested solicitation or public opposition, the final fee would be $15,000, payable upon the conclusion of MacKenzie’s engagement prior to or upon the certification of the vote for the Special Meeting. National Western will also reimburse MacKenzie for its reasonable out-of-pocket costs and expenses.

Adjournments

If a quorum is not present at the Special Meeting, the stockholders entitled to vote thereat, present in person or represented by proxy, may, by a majority in voting power thereof adjourn the meeting until such time that a quorum may be obtained, without further notice other than by an announcement made at the Special Meeting (unless the adjournment is for more than 30 days or if a new record date is fixed). If a quorum is present at the Special Meeting but there are not sufficient votes at the time of the Special Meeting to approve the proposal, then National Western stockholders may be asked to vote on a proposal to adjourn the Special Meeting so as to permit the further solicitation of proxies in favor of the proposal to adopt the merger agreement.

THE MERGER

Effects of the Merger

Upon the terms and subject to the conditions of the merger agreement, at the effective time, Merger Sub, a direct, wholly-owned subsidiary of Parent that was formed for the sole purpose of effecting the merger, will merge with and into National Western, and the separate corporate existence of Merger Sub will cease, with National Western continuing as the surviving corporation and as a wholly-owned subsidiary of Parent. As a result of the merger, the Class A common stock will no longer be publicly traded and will be delisted from NASDAQ and will be deregistered under the Exchange Act. If the merger is completed, you will not own any shares of the capital stock of the surviving corporation in the merger.

In the merger, each share of Company common stock issued and outstanding immediately prior to the effective time will be converted into the right to receive $500.00 cash without interest.

Effect on National Western if the Merger is Not Completed

If the merger agreement is not adopted by the Company’s stockholders, or if the merger is not completed for any other reason, the Company’s stockholders will not be entitled to, nor will they receive, any payment for their respective shares of Company common stock pursuant to the merger agreement. The Company will remain an independent, public company, Company common stock will continue to be listed and traded on NASDAQ and registered under the Exchange Act. The Company will continue to file periodic reports with the SEC. The Company anticipates that management will operate the business in a manner similar to that in which it is being operated today and stockholders will be subject to similar risks and uncertainties, including those related to the Company’s business, prospects and results of operations, as such may be affected by, among other things, the highly competitive industry in which the Company operates and economic conditions. As described in the section titled “— Termination Fees and Expenses,” under certain specified conditions, the Company may be required to pay Parent the Company termination fee.

Background of the Merger

The following chronology summarizes the communications and events that led to the signing of the merger agreement. This chronology is not, and does not purport to be, a catalogue of every interaction among the Company and any applicable parties.

Ownership and Control of National Western

National Western Life was incorporated in 1956 as a Colorado insurance company. In 1965, National Western Life merged with three other life insurance companies, including Reliance National Life Insurance Company (“Reliance National,”) which was controlled by Robert Moody. In the Reliance National merger with National Western Life, Robert Moody exchanged his Reliance National shares for a controlling interest in National Western Life. His interest in National Western Life included 100% of the shares of the newly-created Class B common stock. Those shares entitled Robert Moody to appoint two-thirds of National Western Life’s board of directors (rounded down), with the holders of the newly-created Class A common stock entitled to appoint the remaining directors.

Until December 2015, National Western Life was the top-tier company in the organizational structure. In December 2015, National Western Life received stockholder approval to form a new holding company. As a result, all of National Western Life’s outstanding shares of Class A common stock and Class B common stock were converted into shares of Class A common stock and Class B common stock, respectively, of the newly-formed National Western Life Group, Inc. (i.e., the company that has previously defined in this proxy statement as the “Company” or “National Western”). After the new holding company structure was implemented, National Western owned 100% of National Western Life and succeeded National Western Life as the publicly-traded company.

For most of the period from 1965 until 2015, Robert Moody served as Chairman of the Board and Chief Executive Officer of National Western Life. In 2015, Ross Moody, Robert Moody’s son, was named Chief Executive Officer of National Western Life, having served as President and Chief Operating Officer of National Western Life since 1992. Ross Moody was appointed Chairman of the Board in 2016, at which time Robert Moody was named Chairman Emeritus. Ross Moody has served as a director since 1981, and Frances Moody-Dahlberg, Robert Moody’s daughter, has served as a director since 1990.

Since 1965, substantially all of the outstanding shares of Class B common stock of National Western (or, prior to December 2015, National Western Life) have been owned by Robert Moody or trusts he created. Today, voting control of 99% of the outstanding Class B common stock is held by the Robert L. Moody Revocable Trust (the “Moody Revocable Trust”), and the remaining 1% is held by Three R Trust, a trust created by Robert Moody for the benefit his children and their lineal descendants. Separately, Robert Moody’s children beneficially own a total of approximately 34% of the outstanding shares of Class A common stock. See “Security Ownership of Certain Beneficial Owners and Management — 5% or More Beneficial Owners” beginning on page 93.

Exploration of Strategic Alternatives

In 2021, American National Group, Inc. (“American National”), a publicly-traded, multi-line insurance company founded by the Moody family in 1905, agreed to be acquired by Brookfield Reinsurance Ltd. (“Brookfield Reinsurance”). The $5.1 billion cash purchase price represented a substantial premium to American National’s unaffected stock price. Approximately 60% of American National’s outstanding shares were owned by (i) The Moody Foundation, a charitable foundation established by the Moody family, and (ii) the Libbie Shearn Moody Trust, a charitable trust established by Robert Moody’s grandmother in 1943. At the time of American National’s sale to Brookfield Reinsurance, Ross Moody served as Chairman of the Board of American National and as a member of the Moody Foundation board. The sale of American National to Brookfield Reinsurance demonstrated the potential opportunity for unlocking value for an insurance company with limited public float through strategic alternatives, particularly a sale to companies with strong asset management capabilities.

In September 2022, Ross Moody, National Western’s Chairman of the Board, CEO and President, reached out to E.J. Pederson, one of the Company’s independent directors, and asked him to chair an ad hoc transaction committee of the National Western board of directors. The purpose of the ad hoc transaction committee would be to evaluate the Company’s strategic alternatives on behalf of the National Western board of directors, given the significant amount of director time and effort required for such a process. Mr. Pederson had served as chair of a similar transaction committee in the strategic review process that resulted in the American National-Brookfield Reinsurance transaction.

On September 15, 2022, Mr. Pederson called an M&A partner at Sidley Austin LLP (“Sidley”) and asked if Sidley would be available to serve as M&A counsel to the Company if the National Western board of directors decided to explore strategic alternatives. The same Sidley team had represented American National in connection with the sale to Brookfield Reinsurance. The Company subsequently entered into an engagement letter with Sidley on September 15, 2022.

Establishing the Transaction Committee and Selecting Advisors

On October 21, 2022, the National Western board of directors held its regularly scheduled bi-monthly meeting. In attendance, in addition to the National Western board of directors and the Company’s senior executive team, was Greg Garrison, a partner with Greer Herz & Adams LLP, who served as the Company’s outside general counsel. At the conclusion of the regular business of the meeting, all of the participants left the meeting, except for the directors and Greg Garrison. Ross Moody reminded the National Western board of directors that, throughout the Company’s history, the Company had maintained a conservative capital structure and investment strategy designed to weather all storms. He explained that the Company was under no pressure to sell itself, but that the life and annuity space is evolving, particularly with respect to some of the asset management tools that more diversified participants in the market can offer. Ross Moody also noted that the Company’s stock price continued to be affected by low volume, in part because of the relatively small public float caused by the stock positions that he and other family members hold. Ross Moody recommended that the board establish an ad hoc transaction committee (the “Transaction Committee”) to oversee a potential exploration of strategic alternatives in order to maximize stockholder value.

After discussion, the National Western board of directors established the Transaction Committee and appointed Mr. Pederson (Chair), David Boone and Dr. Thomas Blackwell to serve on the committee. The Transaction Committee was tasked with exploring and evaluating the Company’s strategic alternatives, with the goal of maximizing value for all stockholders. The Transaction Committee was given authority to interview and retain advisors and consultants, to determine the best process for maximizing stockholder value, to negotiate any transaction documents and to make a recommendation to the National Western board of directors regarding whether to approve a transaction. However, the Transaction Committee was not authorized to approve the final definitive agreements providing for a transaction. That authority was reserved exclusively to the National Western board of directors.

On November 8, 2022 and November 30, 2022, the Transaction Committee interviewed three nationally-recognized investment banks with experience in insurance M&A as potential candidates to act as financial advisor to the Company in connection with the Company’s strategic review process. These interviews took place in person in Austin, Texas. Ross Moody and one or two other directors also participated in these meetings, as did Greg Garrison and representatives from senior management and Sidley. Following these interviews, each of the three investment banks submitted fee proposals to the Transaction Committee.

On December 5, 2022, the Transaction Committee met with Greg Garrison and representatives from Sidley to evaluate the presentations and fee proposals from each of the three investment banks that the Transaction Committee had interviewed. After discussion, the Transaction Committee instructed representatives from Sidley to inform Goldman Sachs that the Company was willing to engage Goldman Sachs, subject to Goldman Sachs making certain adjustments to its fee proposal. The Transaction Committee discussed the fact that Goldman Sachs has performed an extensive amount of work for several of the likely potential counterparties, as well as for affiliates of those potential counterparties. Even so, because of Goldman Sachs’ qualifications, experience and reputation, particularly in the insurance industry, the Transaction Committee determined to engage Goldman Sachs on behalf of the Company. Later that evening, representatives from Goldman Sachs and the Transaction Committee agreed to the terms of the fee structure described in “— Opinion of National Western’s Financial Advisor — General,” beginning on page 50. Goldman Sachs’ engagement letter was finalized and signed on January 4, 2023.

On December 7, 2022, representatives from Sidley informed each of the other two investment banks that they had not been selected as financial advisor.

On December 9, 2022, the Company engaged Milliman Inc. (“Milliman”) to perform an actuarial appraisal to be shared with prospective counterparties in the strategic review process. The Company and Milliman finalized and signed Milliman’s engagement letter on December 12, 2022.

On December 9, 2022, the closing stock price of the Class A common stock price increased to $243.13 per share, an increase of 11.6% over the previous day’s closing price of $217.82 per share. Over 40,000 shares traded that day, which is a significant daily trading volume for National Western. On December 13, 2022, the closing stock price increased to $280.00 per share, on a volume of 93,400 shares. Trading volume continued to be high until mid-January 2023. On December 14, 2022, representatives from Sidley discussed the trading activity with the National Western board of directors and discussed how to respond if the Company was contacted by the media or other third parties. At that time, only the directors and a very small number of senior management team members were aware of the strategic review process. In addition, customary confidentiality precautions (including code names) were being used consistently. Shortly after Sidley’s discussion with the National Western board of directors, Sidley representatives sent the Transaction Committee a leak and communications plan, which was approved by the Transaction Committee. This leak and communications plan was distributed to the senior management team members who were already aware of the strategic review process. The Company did not receive any inquiries about the December 2022 trading activity from the media or from third parties.

Preparation for Outreach to Potential Counterparties

On December 16, 2022, the Transaction Committee met with Greg Garrison and representatives from Goldman Sachs and Sidley. At the meeting, the Transaction Committee discussed the strategic review process with representatives from Sidley and Goldman Sachs. Representatives from Goldman Sachs presented a timeline of the strategic review process, including key milestones and a list of information Goldman Sachs had requested from the Company. The meeting participants discussed the Confidential Information Memorandum (“CIM”) being prepared by Goldman Sachs for distribution to potential counterparties. The parties also discussed the actuarial appraisal being prepared by Milliman. The Transaction Committee also discussed whether an announcement of the strategic review process should be made at this time. After discussing the matter with the Company’s advisors, the Transaction Committee decided not to announce the strategic review process.

From mid-December 2022 until late April 2023, the Transaction Committee met ten times with representatives from Goldman Sachs and Sidley to discuss the progress of the preparation of the CIM and the Milliman appraisal. During that same time period, representatives from Goldman Sachs, Milliman and Sidley met weekly with the Company’s senior management team to facilitate the preparation of the CIM and Milliman appraisal, as well as to begin the work necessary to populate the virtual data room (the “VDR”) to be used in the strategic review process.

Goldman Sachs’ Outreach to Potential Counterparties

Beginning April 24, 2023 and continuing until late May 2023, Goldman Sachs, at the direction of the Transaction Committee, contacted 68 potential counterparties, including 38 strategic parties and 30 financial sponsors, including Parent, to gauge their interest in making a proposal to acquire all or a portion of an insurance company that representatives from Goldman Sachs described to potential counterparties but did not identify. Interested parties were then asked to sign a confidentiality agreement to receive more detailed information. Of those parties contacted, 46 potential counterparties ultimately executed confidentiality agreements with the Company. Those parties received a copy of the CIM and the Milliman appraisal. Each of the executed confidentiality agreements contains a customary standstill provision with a term of at least 12 months. Each standstill provision expressly permits the potential counterparty to (i) discuss a potential transaction with, (ii) make a non-binding proposal for a potential transaction to, and (iii) request a waiver of the standstill provision from, the Transaction Committee, provided that any such discussions, proposals or waiver requests are kept confidential and could not reasonably be expected to require public disclosure by any party pursuant to any applicable laws or stock exchange regulations.

Beginning on May 3, 2023, Goldman Sachs, at the direction of the Transaction Committee, sent a first-round process letter to parties that had signed confidentiality agreements. The process letter advised those parties that they should submit their preliminary proposals by June 7, 2023. The first-round process letter made clear that there was a strong preference for an offer structured as a 100% cash transaction. However, the potential counterparties were also permitted to propose non-cash consideration.

Continental General’s Proposal

On January 19, 2023, Continental General Insurance Company (“Continental General”) filed a Schedule 13G with the SEC, disclosing that Continental General and its affiliates collectively owned 5.13% of the Class A common stock. Continental General is an insurance company headquartered in Austin, Texas, and its chief executive officer and chief operating officer are both former senior employees of the Company. Prior to Continental General’s Schedule 13G filing, representatives from Continental General had from time to time expressed interest in a business combination with National Western if the opportunity presented itself.

At its meeting on April 20, 2023, the Transaction Committee and representatives from Goldman Sachs and Sidley discussed Goldman Sachs’ recommendations as to which potential counterparties should be invited to participate in the strategic review process. The meeting participants also discussed the proposed timeline for the strategic review process. During that portion of the meeting, the Transaction Committee asked whether Continental General should be included in the strategic review process, given that it had previously expressed interest in a business combination and was now a 5% stockholder. After discussing Continental General’s historical lack of M&A activity and its financial profile with the Company’s advisors, the Transaction Committee decided not to include Continental General in the strategic review process at that time.

On April 24, 2023, Continental General filed a Schedule 13D with the SEC, disclosing that it had increased its ownership to 188,444 shares of Class A common stock (5.5% of that class). In its Schedule 13D filing, Continental General also disclosed that Continental General believed that there are numerous operational and strategic opportunities to maximize stockholder value and it would seek to engage in a dialogue with the National Western board of directors and management to discuss those matters.

On April 27, 2023, the Transaction Committee met with Ross Moody, Greg Garrison and representatives from Goldman Sachs and Sidley. At the meeting, the meeting participants discussed Continental General’s Schedule 13D filing and whether Continental General should now be included in the strategic review process. After discussion, the Transaction Committee decided not to engage with Continental General until Continental General reached out to the Company to clarify its objectives with respect to the Company.

Late that night, Continental General sent Ross Moody and Rey Perez, National Western Life’s President and Chief Operating Officer, a proposal to acquire 100% of National Western for $300 per share, subject to adjustments relating to National Western’s capital levels at closing. In its proposal letter, Continental General requested a 120-day exclusivity period to finalize a transaction. After Ross Moody read the proposal on the morning of April 28, 2023, he shared the proposal with the Transaction Committee, Greg Garrison and representatives from Goldman Sachs and Sidley. A meeting of the Transaction Committee was scheduled for April 30, 2023.

On April 30, 2023, the Transaction Committee met with Ross Moody, Rey Perez, Greg Garrison and representatives from Goldman Sachs and Sidley. At the meeting, the participants discussed Continental General’s proposal to acquire the Company. After deliberation, it was the consensus of the Transaction Committee and senior management that the Company should engage in discussions with Continental General, but only on a non-exclusive basis, and only after Continental General had signed the same form of confidentiality agreement that the participants in the strategic review process were being asked to sign. Because Continental General had not yet signed a confidentiality agreement, the Transaction Committee determined not to inform Continental General about the strategic review process until it had signed an acceptable confidentiality agreement.

On May 2, 2023, Rey Perez sent an email to Michael Gorzynski, the Executive Chairman of Continental General, thanking him for the April 27th proposal letter. Rey Perez informed Michael Gorzynski that National Western was willing to share confidential information with Continental General, subject to signing the confidentiality agreement that was attached to Rey Perez’s email. However, Mr. Perez explained that it was premature to discuss exclusivity. Mr. Perez concluded his email by expressing the hope that Continental General’s review of additional non-public information would allow Continental General “to develop a more refined view of value.” With the exception of omitting all references to the Company’s strategic review process, the confidentiality agreement sent to Continental General was in exactly the same form as was being used for potential counterparties in the strategic review process, including a standstill provision and employee non-solicitation provision.

On May 3, 2023, Continental General responded with comments on the confidentiality agreement, proposing to shorten the two-year term to six months and completely removing the standstill provision and employee non-solicitation provision.

On May 5, 2023, National Western sent Continental General a revised draft of the confidentiality agreement, which accepted certain revisions proposed by Continental General. However, National Western’s revised draft restored the confidentiality term to two years and reinserted standstill and employee non-solicitation provision, each with an 18-month term. The 18-month term for those provisions was the minimum term to which the potential counterparties in the strategic review process had been agreeing.

Continental General’s Colorado Form A

On May 10, 2023, Continental General filed a Form A with the Colorado Division of Insurance (the primary insurance regulator for National Western Life), requesting authorization to increase Continental General’s holdings in National Western beyond 10% of the voting stock and up to 49.99%. The Form A disclosed that Continental General had bought additional shares after its Schedule 13D filing and that Continental General now owned 5.74% of National Western’s Class A common stock.

The Company did not learn about Continental General’s Form A filing until the day it was filed. On May 11, 2023, Continental General informed National Western that Continental General had filed its Form A with the Colorado Division of Insurance. Continental General also indicated it would be making a similar filing in Missouri (the domicile of Ozark National Life). Continental General also informed National Western that it was not willing to sign the confidentiality agreement, especially with a standstill provision and a one-way employee non-solicit provision. Continental General also indicated that it might seek support for its proposed acquisition directly from the Company’s stockholders.

Public Announcement of the Strategic Review Process

Later in the day on May 11, 2023, the Transaction Committee met with Greg Garrison and representatives from Goldman Sachs and Sidley to discuss whether the Company should inform Continental General about the strategic review process, since it stated that it wanted to acquire the Company. Representatives from Sidley reminded the Transaction Committee that the existence of the strategic review process was material non-public information. Therefore, since Continental General had not signed a confidentiality agreement, the Company could not inform Continental General about the process unless it issued a public announcement about the process. The Transaction Committee instructed the Sidley representatives to discuss the public announcement approach with senior management to determine what impact a public announcement of a strategic review process might have on the Company and its employees.

On May 12, 2023, the Transaction Committee met with Greg Garrison and representatives from senior management and Sidley to discuss whether to publicly announce the strategic review process. No decision was made at this time, but Sidley was instructed to prepare a draft press release and draft employee communications in case a decision was made to publicly announce the strategic review process.

On May 14, 2023, the Transaction Committee met with Greg Garrison and representatives from senior management and Sidley to continue the discussion about publicly announcing the strategic review process. The meeting participants discussed the impact, if any, of an announcement on the ability of the Transaction Committee to terminate the strategic review process without completing a strategic transaction. The meeting participants also discussed the regulatory implications of a public announcement, especially in light of Continental General’s Form A filing in Colorado. The Transaction Committee instructed the representatives from senior management and Sidley to proceed with the steps to announce the strategic review process. However, because calls needed with National Western Life’s and Ozark National Life’s insurance regulators needed to be scheduled in advance, the Transaction Committee instructed senior management no announcement should be made before May 16, 2023.

On May 15, 2023, the Transaction Committee confirmed to representatives of senior management that it was authorized to publicly announce the strategic review process on May 16, 2023.

Also on May 15, 2023, after the close of trading on NASDAQ, National Western filed its first quarter Quarterly Report on Form 10-Q. The filing of the Form 10-Q had been delayed in accordance with Rule 12b-25 while the new implementation of recent accounting pronouncements was being reviewed with National Western’s auditors.

During the evening of May 15, 2023 and during the day on May 16, 2023, representatives from the Company reached out to the Colorado Division of Insurance (National Western Life’s primary insurance regulator) and the Missouri Department of Insurance (Ozark National Life’s primary insurance regulator) to inform them that the Company would be publicly announcing a strategic review process after the close of trading on May 16th.

On May 16, 2023, after the close of trading on NASDAQ, National Western publicly announced that the National Western board of directors was exploring strategic alternatives in order to maximize stockholder value and had hired Goldman Sachs to assist the Company with the strategic review process.

Later that afternoon, after the issuance of the press release, Rey Perez sent Michael Gorzynski a copy of the press release and invited Continental General to participate in the strategic review process, subject to the execution of an acceptable confidentiality agreement. An updated draft of the confidentiality agreement was attached to Mr. Perez’s email. That draft was substantially similar to the draft most recently sent to Continental General, except that the updated draft included the process-related provisions that had previously been removed.

On May 17, 2023 and May 18, 2023, the price per share of Class A common stock increased by almost 50% on heavy trading volume, closing at $405.01 per share on May 18, 2023. Late in the afternoon on May 18, 2023, Michael Gorzynski informed representatives from Goldman Sachs that Continental General declined to participate in the strategic review process.

Following the Company’s May 16, 2023 announcement of the strategic review process, five inbound inquiries were received by Goldman Sachs from parties interested in participating in the strategic review process, and each of those five parties executed confidentiality agreements. One of those parties submitted a first-round proposal, but was not selected to advance to the second round.

First Round Proposals and Invitations to the Second Round

Beginning on June 7, 2023 (the first-round submission due date), the Company received 15 indications of interest, 11 of which were proposals to acquire 100% of the Company. The total equity value offered in those 11 first round proposals ranged from $1.4 billion to $2.3 billion (representing a range of approximately $370 to $600 per share). In this “Background of the Merger” section, all per share calculations relating to proposals from potential counterparties take into account the Company’s outstanding equity-based awards as of the date of this proxy statement.

From June 7, 2023 to June 9, 2023, representatives of Goldman Sachs participated in calls with the potential counterparties that submitted proposals in order to clarify their proposals.

On June 9 and June 12, 2023, the Transaction Committee met with Greg Garrison and representatives from Sidley and Goldman Sachs to discuss the first round proposals. Ross Moody also participated in the June 12th meeting. During those meetings, representatives from Goldman Sachs provided an overview of the preliminary proposals received in the first round of the process and provided input regarding certain aspects of the first-round proposals that the Transaction Committee might wish to consider when determining which potential counterparties to advance into the second round of the strategic review process, including the proposed total equity values and the relative levels of engagement by each of the potential counterparties that submitted conforming bids. After discussion, and taking those factors into account, the Transaction Committee selected seven potential counterparties for the second round, including Parent and six other potential counterparties. The total equity value represented by these seven proposals ranged from $1.9 billion to $2.3 billion (approximately $500 to $600 per share):

•        Party Y            $2.30 billion

•        Party Z            $2.30 billion

•        Parent              $2.20 billion

•        Party X            $2.15 billion

•        Party A            $2.00 billion

•        Party B            $1.90 billion

•        Party C            $1.90 billion

Following the June 12, 2023 Transaction Committee meeting, representatives from Goldman Sachs, at the direction of the Transaction Committee, invited those seven potential counterparties into the second round of the process and informed the remaining potential counterparties they had not been selected to proceed. However, at the direction of the Transaction Committee, representatives from Goldman Sachs asked an additional potential counterparty to submit a proposal for reinsuring the Company’s annuities business, with a view to possibly pairing that potential counterparty with Party A.

On June 16, 2023, the seven parties participating in the second round received access to the VDR. Representatives from Goldman Sachs and Sidley worked with Company management to continue to populate the VDR and to prepare for the management presentations to the second round participants.

Also on June 16, 2023, representatives from Goldman Sachs, at the direction of the Transaction Committee, sent the procedures for submitting second round proposals to each second round participant, informing them that second round proposals should be submitted no later than August 7, 2023. Similar to the first-round process letter, the second-round process letter made clear that potential counterparties were invited to submit a proposal to acquire National Western’s entire business.

Management Presentations for Second Round Participants

Between June 27, 2023 and July 17, 2023, members of the Company’s senior management team, Greg Garrison and representatives from Goldman Sachs and Sidley participated in management presentations with second round participants.

Each management presentation was conducted in person at the Company’s headquarters in Austin, Texas. Topics covered in the management presentations included, among other things, business line overviews, growth opportunities, human resources and technology overviews, the international business and legal, regulatory and compliance information relating to the Company. Additionally, during this time and until late September 2023, the Company’s management and other representatives conducted due diligence discussions with, and provided due diligence responses to, the second-round participants that remained in the process.

On June 27, 2023 Parent received its management presentation.

On July 3, 2023, prior to its scheduled management presentation, Party C informed representatives from Goldman Sachs that it was no longer participating in the Company’s strategic review process.

On July 12, 2023, following its July 10th management presentation, Party A informed representatives from Goldman Sachs that it was no longer participating in the Company’s strategic review process.

Following the completion of the management presentations, from July 23, 2023 to August 23, 2023, Parent, Party X and Party Y participated in several ad hoc due diligence sessions with the Company’s senior management team, covering various aspects of the business in more detail, including the Company’s international operations.

Second Round Proposals and Invitations to the Third Round

On July 13, 2023, Sidley’s draft merger agreement was posted to the VDR. The second round process letter had requested that the second round participants submit a full mark-up of Sidley’s draft merger agreement on or before July 28, 2023. The merger agreement mark-ups were requested on that schedule in order to give representatives from Sidley an opportunity to discuss any material issues prior to the second round submission date.

The draft merger agreement posted to the VDR contemplated that, contemporaneously with the execution of the merger agreement, a voting and support agreement would be executed by Ross Moody, Frances Moody-Dahlberg and Russell Moody. Those three stockholders, together with their respective investment vehicles, collectively own approximately 24.23% of the combined voting power of the Class A common stock and Class B common stock. The draft merger agreement did not contemplate that a voting and support agreement would be signed by the Moody Revocable Trust, which owns 99% of the Class B common stock and approximately 5.45% of the combined voting power of the Class A common stock and Class B common stock.

On July 28 2023, counsel for Party X and counsel for Party Y submitted their respective mark-ups of the VDR draft of the merger agreement. In its mark-up of the draft merger agreement, counsel for Party Y noted that Party Y expected all Moody family members, trusts and investment vehicles would execute a voting and support agreement.

On July 31, 2023, Sidley’s draft form of voting and support agreement was posted to the VDR. The draft form noted that the only parties signing a voting and support agreement would be Ross Moody, Frances Moody-Dahlberg and Russell Moody.

On August 1, 2023, representatives from Sidley discussed each of those mark-ups with counsel for those potential counterparties. During each of those conversations, the Sidley representatives highlighted several provisions that the potential counterparties’ counsel should reconsider and modify in order to be competitive in the process. During the merger agreement discussion between representatives of Sidley and representatives of counsel to Party Y, the Sidley representatives explained that, in order to maintain confidentiality, the Company was not willing to expand the number of parties signing a voting and support agreement beyond Ross Moody, Frances Moody-Dahlberg and Russell Moody. The Sidley representatives noted that each of those individuals was either an officer, director or advisory director of the Company was therefore already aware of which potential counterparties were participating in the strategic review process.

On August 7, 2023, Party X submitted its second round proposal. Party X proposed a total equity value of $2.0 billion (approximately $525 per share) and included an updated mark-up of the merger agreement. Party X’s proposal stated that its conditions to close a transaction would not be subject to a financing condition and that Party X had obtained committed bridge financing from J.P. Morgan Securities LLC. Party X’s second round proposal requested the Company’s assistance with obtaining regulatory approval for a post-closing merger of National Western Life with a Party X insurance company subsidiary, but noted that the subsidiary merger would not be a closing condition. Similarly, Party X requested the Company’s assistance with obtaining regulatory approval for a pre-closing dividend payable to the Company from National Western Life and Ozark National Life, but noted that such a dividend would not be a closing condition.

Also on August 7, 2023, Party Y submitted a letter indicating that it would not be able to submit its second round proposal until August 21st. In Party Y’s letter, it did respond to Sidley’s August 1st feedback regarding the merger agreement, accepting some of Sidley’s proposed modifications and declining to accept others. Party Y’s August 7th letter did not include a proposed total equity value, but it did confirm that Party Y would not be seeking either a financing condition or a pre-closing dividend condition. Party Y’s letter also noted that it still required the Moody Revocable Trust to execute a voting and support agreement, but was no longer requesting that other Moody family members, trusts or investment vehicles sign such an agreement.

On August 8, 2023, Parent submitted its second round proposal, together with its initial mark-up of the merger agreement. Parent proposed a total equity value of $2.05 billion, to be adjusted downward for the actual amount of the Company’s advisor fees and other transaction expenses. In light of this proposed adjustment for transaction expenses, the Transaction Committee considered Parent’s proposed merger consideration to be approximately $529 per share. Parent’s proposal stated that its conditions to close a transaction would not include a financing condition. Parent delivered a copy of a debt financing commitment letter from Wells Fargo Bank, National Association, Wells Fargo Securities, LLC, and Citi and confirmed that affiliates of Elliott were prepared to provide a customary equity commitment letter. From a regulatory standpoint, Parent’s second round proposal stated that the closing of the transaction would be subject to regulatory approval of the redomestication of National Western Life from Colorado to Arizona. Parent’s initial mark-up of the merger agreement also noted that Parent expected all Moody family members would execute a voting and support agreement.

Also on August 8, 2023, Party Z submitted an informal high-level indication of interest, providing an indicative valuation level and noting that it still had significant due diligence to complete before it could proceed further. Party Z did not submit a mark-up of the merger agreement with its indication of interest.

On August 8 and August 10, 2023, the Transaction Committee met to review the second round proposals that had been received to date. In attendance, in addition to the Transaction Committee, were Greg Garrison and representatives from Sidley and Goldman Sachs. Addressing the fact that Party Y had not yet submitted its second round proposal, representatives from Goldman Sachs noted that Party Y had significant remaining due diligence to undertake and needed an additional two weeks. In addition to discussing the valuations contemplated by each of the second round proposals, the Transaction Committee asked representatives of Sidley about the status of each of the three merger agreement mark-ups that had been received. The Sidley representatives reported that Party X had submitted a reasonable merger agreement mark-up that would not take long to negotiate. In addition, preparing disclosure schedules for that agreement would not place an undue burden on the Company’s senior management team. However, with respect to the merger agreement mark-ups for Parent and Party Y, those agreements were going to be more difficult to finalize and the disclosure schedules would require much time and effort on the part of the management team. In addition, both Parent and Party Y had proposed interim operating restrictions that would be difficult to comply with. However, the Sidley representatives concluded by saying that, regardless of which party was selected as the preferred counterparty, any obstacles necessary to finalize the merger agreement could be overcome. Given that there was not clear separation between the financial and regulatory aspects of Parent’s proposal and Party X’s proposal, the Transaction Committee decided to ask both parties to complete all remaining due diligence and submit a revised proposal with an updated view on valuation. The Transaction Committee instructed representatives from Goldman Sachs to ask Party Y to continue with its diligence and to inform Party Y that the Company already had transactable solutions in hand with other potential counterparties.

On August 12, 2023, a representative from Citi called a representative from Sidley to discuss Parent’s request that additional Moody family members sign a voting and support agreement. After discussion, the Sidley representative agreed to reach out to counsel for Moody National Bank (“Moody Bank”), the trustee of the Moody Revocable Trust, to determine if Moody Bank would be willing to consider signing a voting and support agreement. However, the Sidley representative informed the Citi representative that the Company would not be willing to make a similar request to any other Moody family members.

On August 14, 2023, Party B informed representatives from Goldman Sachs that it would not be submitting a second round proposal.

Also, on August 14, 2023, representatives from counsel to Party Y, sent comments on the draft voting and support agreement to Sidley.

On August 16, 2023, Sidley representatives sent a draft voting and support agreement to representatives from Baker Botts LLP (“Baker Botts”). Baker Botts serves as counsel to Moody Bank, as trustee of the Moody Revocable Trust. The Sidley representatives requested that the Baker Botts representatives discuss with Moody Bank whether Moody Bank would be willing to sign a voting and support agreement.

On August 17, 2023, representatives from Sidley sent a revised draft of the merger agreement to counsel for Party X.

On August 19, 2023, representatives from Goldman Sachs, at the direction of the Transaction Committee, sent Parent and Party X instructions for submitting third round proposals, with a submission deadline of August 31, 2023. Each potential counterparty was instructed to confirm that all diligence had been completed and to confirm all financing sources, including all relevant financing commitment documentation. In addition, each potential counterparty was asked to provide a timeline and description of any required approvals necessary for signing, as well as an updated mark-up of the merger agreement.

On August 21, 2023, representatives from Debevoise & Plimpton LLP (“Debevoise”), counsel to Parent, sent comments on the draft voting and support agreement to Sidley.

On August 22, 2023, representatives from Sidley sent a revised draft of the merger agreement to Debevoise.

Also on August 22, 2023, Party Y submitted its second round proposal, and Party Y’s counsel submitted an updated draft of the merger agreement. Party Y proposed a total equity value of $1.89 billion (approximately $496 per share). Party Y’s proposal was not subject to a financing condition, and Party Y confirmed that it would fund the transaction with cash on hand and availability under existing debt facilities. The proposal stated that it would request a pre-closing extraordinary dividend of excess capital above a risk-based capital level (“RBC”) of 350% (estimated by Party Y to be $1.1 billion at closing), but that the dividend was not a closing condition. Similarly, Party Y stated that it intended to redomesticate National Western Life from Colorado to the domicile of one of Party Y’s primary insurance company subsidiaries. However, that redomestication would not be a closing condition. Party Y also noted that the approval of its insurance company subsidiary’s primary insurance regulator was also required to approve the proposed transaction.

On August 23, 2023, the Transaction Committee met to discuss the second round of the strategic review process. In attendance, in addition to the Transaction Committee, were Greg Garrison and representatives from Sidley and Goldman Sachs. The meeting participants discussed Party Y’s second round proposal and decided that Party Y should advance to the third round, even though its proposal had the lowest total equity value of the three proposals advancing to the third round. Representatives from Goldman Sachs reported that Party Z had not submitted a formal proposal, but instead had recently sent Goldman Sachs an informal email suggesting total equity value ranging from $1.5 billion to $1.7 billion. After discussion, the Transaction Committee confirmed that Party Z should not move forward into the third round.

Also on August 23, 2023, representatives from Sidley sent Baker Botts an updated draft of the voting and support agreement, reflecting the comments that had previously been received from Debevoise and counsel to Party Y.

On August 24, 2023, at a regular meeting of the National Western board of directors, representatives from Goldman Sachs updated the directors on the strategic review process. They explained the characteristics of the Company’s business that potential counterparties had mentioned to representatives from Goldman Sachs as key drivers of value and potential additional due diligence. The Goldman Sachs representatives then explained the three remaining proposals, noting that each potential counterparty was narrowing its list of open items. The Goldman Sachs representatives then explained the financing plan and regulatory plan for each of the three remaining potential counterparties. At the same meeting, a representative from Sidley gave the directors a presentation summarizing the merger agreement and the key provisions of that document that were being negotiated.

Also on August 24, 2023, representatives from Goldman Sachs, at the direction of the Transaction Committee, provided Party Y with instructions for submitting proposals in the third round. With respect to Party Y’s second round proposal, those representatives informed Party Y that its valuation was lower than other potential counterparties. Party Y was also requested to move quickly and inform Goldman Sachs regarding any potential improvements to its proposal in order to continue in the process.

On August 25, 2023, during a meeting with the Transaction Committee in which Mr. Garrison and representatives from Sidley also participated, representatives from Goldman Sachs previewed the financial analysis that would eventually inform Goldman Sachs’ fairness opinion.

Third Round Proposals

On August 25, August 29, and August 30, 2023, respectively, Parent, Party X and Party Y each gave a presentation to representatives from National Western’s senior management, Goldman Sachs and Sidley regarding the potential counterparty’s plan and approach for seeking regulatory approval.

On August 29, 2023, representatives from Debevoise sent Sidley a revised draft of the merger agreement for Parent, responding to Sidley’s August 22nd draft. Also on August 29, 2023, representatives from Sidley sent a revised draft of the merger agreement to counsel for Party Y.

Between August 25, 2023 and September 1, 2023, each participant in the third round continued to conduct confirmatory due diligence on a variety of topics.

On August 29, 2023 — the day before third round proposals were due — representatives from Party Y informed Goldman Sachs representatives that its third round proposal would not reflect an increase form its second round proposal. However, the Party Y representatives told the Goldman Sachs representatives that Party Y might have room

to improve valuation if chosen as the preferred counterparty. The representatives from Goldman Sachs responded that a higher proposed merger consideration would be required before the Company would be willing to move forward with Party Y.

On August 31, 2023, Parent, Party X and Party Y submitted third round proposals:

•        Parent proposed a total equity value of $1.92 billion (approximately $505 per share) and included an updated mark-up of the merger agreement. Parent’s updated proposal did not include a financing condition and its only significant regulatory condition was the approval of National Western Life’s redomestication to Arizona. In its proposal, Parent noted that it had completed due diligence and that, before signing a merger agreement, Parent would need to obtain final approval from the Parent’s board and from Elliott’s investment committee.

•        Party X proposed a total equity value of $1.92 billion (approximately $505 per share) and requested one week of exclusivity. Party X’s proposal noted that it no longer needed bridge financing. The original purpose of the bridge financing had been to provide short-term financing for the portion of the merger consideration that would be repaid from a post-closing extraordinary dividend from National Western Life to Party X. Instead of obtaining a debt commitment for bridge financing, Party X added an additional regulatory condition to its proposal. Specifically, Party X proposed that the merger between Merger Sub and the Company would be conditioned upon regulatory approval of a second merger: the merger of National Western Life into one of Party X’s life insurance subsidiaries. This proposed subsidiary merger would permit National Western Life’s excess capital to be available to Party X’s life insurance subsidiary. As a result, Party X would not need regulatory approval for a post-closing dividend from National Western Life. Party X’s proposal also noted that Party X would not be required to close the transaction if the Colorado Division of Insurance imposed a prohibition or limitation on the payment of dividends by National Western Life.

•        Party Y proposed a total equity value of $1.89 billion (approximately $496.35 per share) and included a merger agreement comment memo that contained significant pushback to the August 29th Sidley draft of the merger agreement. Party Y’s proposal did not contain a financing condition or a pre-closing dividend condition. Party Y requested 14 days of exclusivity and noted that it still had confirmatory due diligence to complete.

On September 1, 2023, the Transaction Committee met to discuss the third round of the strategic review process. In attendance, in addition to the Transaction Committee, were Greg Garrison and representatives from Sidley and Goldman Sachs. The Goldman Sachs and Sidley representatives emphasized that, if the National Western board of directors elected to sell the Company, the goal would be to obtain the highest valuation with the most amount of certainty. The Transaction Committee discussed the risks and benefits of each proposal. The Sidley representatives recommended that it discuss each potential counterparty’s proposed merger agreement mark-up with the appropriate counsel, noting that, with the exception of the subsidiary merger structure, Party X still had a much more workable merger agreement than either Parent or Party Y. Later that day, representatives from Goldman Sachs held calls with each party to clarify certain questions on the proposals. Also later that day, representatives from Sidley discussed the viability and potential consequences of Party X’s proposed merger subsidiary structure with Party X’s counsel.

On September 3, 2023, Party X sent an updated proposal with a total equity value of $1.945 billion (approximately $510.25 per share). The proposal also included a request for exclusivity. Party X’s new proposal offered to increase the merger consideration by $10 million if the Company agreed to an investment management agreement with a Party X affiliate. If the Company agreed to this proposal, that investment management arrangement would become effective immediately after the merger agreement was signed. In addition, the September 3rd update offered to increase the merger consideration by up to $28 million, to the extent that the sale of the Company’s real estate assets (including the Company’s headquarters building) produced total proceeds greater than the combined appraised value of the asset sold. With respect to Party X’s regulatory conditions, Party X removed the merger subsidiary closing condition. However, in its place, Party X’s new proposal conditioned closing on the receipt of regulatory approval for a pre-closing dividend from National Western Life of at least $850 million. In its updated proposal, Party X estimated the payment of that dividend to leave National Western Life with an RBC of 400% as of December 31, 2023 and over 440% at Party X’s anticipated closing date).

On September 4, 2023, representatives from Sidley negotiated each of the three forms of merger agreement with Debevoise (Parent’s counsel), counsel for Party X and counsel for Party Y. Sidley’s goal for requesting these meetings was to provide each potential counterparty’s counsel with a roadmap for making that party’s merger agreement as competitive as possible. In that regard, the Sidley representatives made significant progress with counsel for both Parent and Party X. As for Party Y, the discussions with Party Y’s counsel were thorough with respect to the topics discussed during the call. However, representatives from Party Y’s counsel informed the Sidley representatives that, since they had not received Sidley’s revised draft until August 29, 2023, they were not prepared to discuss the merger agreement representations or warranties during the meeting. Party Y’s counsel told the Sidley representatives that a revised draft of the Party Y merger agreement was in process, and that they would send the revised draft to Sidley shortly.

On September 5, 2023, the Transaction Committee met with representatives from Goldman Sachs and Sidley and with Greg Garrison. Sidley updated the Transaction Committee on the status of the merger agreements with Parent, Party X and Party Y. The Transaction Committee agreed that Sidley should negotiate the Party X merger agreement on the assumption that the Company would agree to enter into an investment management agreement with Party X’s affiliate during the interim period (which would increase Party X’s merger consideration by $10 million). The Transaction Committee instructed the Goldman Sachs representatives to inform Party X that it needed to improve valuation and that its most recent proposal created significant closing uncertainty given the nature of Party X’s pre-closing dividend conditions. The Transaction Committee also instructed the Goldman Sachs representatives to inform Parent that it needed to improve valuation and to strengthen the provisions in the merger agreement relating to Parent’s proposed financing arrangements.

Later that day, representatives from Party Y’s counsel informed representatives from Sidley that Party Y would not be submitting a revised merger agreement after all. However, those representatives explained that Party Y would consider a packaged proposal of key deal points that Party Y could then respond to as a whole.

Also on September 5, 2023, representatives from Goldman Sachs provided the Transaction Committee’s feedback to each of the three potential counterparties. The Goldman Sachs representatives informed Party Y that its valuation was low compared to the other potential counterparties. The Goldman Sachs representatives also told Party Y that it needed to act expeditiously and inform Goldman Sachs on any potential improvements to their proposal. Goldman Sachs informed Party X that it needed to improve its valuation and that its proposed minimum dividend closing condition created significant closing uncertainty. Also on September 5, 2023, Parent called representatives of Goldman Sachs to inquire about the status of the process and reaffirmed its August 31, 2023 total equity value of $1.92 billion. The Goldman Sachs representatives replied that Parent needed to improve valuation and improve certain aspects of its legal agreements as it related to transaction financing.

On September 6, 2023, the Transaction Committee met to discuss Party X’s minimum dividend condition. In attendance, in addition to the Transaction Committee, were Greg Garrison and representatives from Goldman Sachs and Sidley. The Sidley representatives explained to the Transaction Committee the risks that come with Party X’s minimum dividend condition and the potential impact on the Company.

Also on September 6, Debevoise sent Sidley a revised draft of Parent’s merger agreement that reflected significant improvement on the agreement.

Later on September 6, 2023, Party X sent an updated proposal with a total equity value of $1.955 billion (approximately $512.75 per share). Party X’s proposal lowered the minimum dividend condition from $850 million to $650 million, but added a requirement that National Western Life would pay $85.8 million to settle outstanding equity-based awards at closing (instead of those payments being made by Party X, as required by the merger agreement). The updated proposal also included a request that National Western Life pay the Company’s transaction expenses, to the extent permitted. As a result, the net financial impact on National Western Life was very similar to the impact of the $850 million dividend condition. Party X also noted that it still needed to complete certain due diligence procedures.

On September 7, 2023, the Transaction Committee met with Greg Garrison and representatives from Goldman Sachs and Sidley to discuss Party X’s minimum dividend condition. The Goldman Sachs representatives presented a side-by-side comparison of the most recent proposals from Parent and Party X. As part of that discussion, the Sidley representatives noted that Parent’s merger agreement had significantly improved in the past few days and that Parent’s merger agreement was now comparable to Party X’s merger agreement. As a result, Party X no longer had a merger agreement advantage over Parent. After deliberation, the Transaction Committee determined that Party X’s proposal

was less certain and placed an undue risk on the Company, while Parent’s proposal was more certain and did not have many of the risks embedded in Party X’s proposal. Also on September 7th, Parent informed Goldman Sachs that Parent’s proposal, including its $1.92 billion aggregate merger consideration, had not changed.

On September 8, 2023, Party X sent Goldman Sachs an updated proposal. Party X’s updated proposal included a requirement for National Western Life to submit a request for a dividend that would result in an RBC for National Western Life no less than 500% (estimated by Party X to be $559 million) within five business days after the merger agreement was signed. Party X stated those funds were to be held by the Company until closing. The new proposal also included a requirement that National Western Life declare and pay its full ordinary dividend capacity between signing and closing, a requirement that National Western Life pay the outstanding equity based awards at closing from its balance sheet and a requirement that National Western Life pays transaction expenses from its balance sheet.

Later on September 8, 2023, the Transaction Committee met to discuss Party X’s updated minimum dividend condition. In attendance, in addition to the Transaction Committee, were Rey Perez, Greg Garrison and representatives from Goldman Sachs and Sidley. The meeting participants discussed the potential impact of Party X’s offer on the Company’s investment portfolio and capitalization. After deliberation, the Transaction Committee decided to inform Party X that there was significant closing uncertainty in its proposal (despite all Party X’s updates to the proposal over the past several days). The Transaction Committee determined that the regulatory risk of Party X’s proposal was still too high and that it would be willing to proceed with Party X only if Party X had obtained a bridge financing commitment that would allow it to drop the minimum dividend condition. The Transaction Committee also instructed the Goldman Sachs representatives to inform Parent that the Company could proceed to execute a transaction with Parent if it could confirm that its diligence was complete, finalize the merger agreement, and obtain requisite board and investment committee approvals in short order. Further, the Transaction Committee discussed Parent’s proposed break-up fee of 4% of total equity value and decided that a break-up fee equal to 3.5% of total equity value was more appropriate under the circumstances.

After the meeting, representatives from Goldman Sachs communicated the Transaction Committee’s responses to Parent and Party X. Parent received Goldman Sachs’ requests positively and informed Goldman Sachs that Parent’s board of directors was supportive of the transaction. Party X informed the Goldman Sachs representatives that removing the dividend condition completely would likely reduce its aggregate merger consideration. Party X indicated it would discuss the Transaction Committee’s response internally.

On September 9, 2023, representatives from Baker Botts sent Sidley comments on the voting and support agreement for the Moody Revocable Trust, including providing the right for the Moody Revocable Trust to terminate the voting and support agreement if the National Western board of directors effected a Change in Recommendation. On September 9, 2023, the Sidley representatives forwarded those comments to representatives from counsel for Party X.

On September 10, 2023, representatives from Goldman Sachs, at the direction of the Transaction Committee, informed Parent that the Company could proceed to execute a transaction with them if it could confirm that their diligence was complete, modify certain aspects of their legal contracts and obtain requisite internal approvals in short order. Parent confirmed to Goldman Sachs that Parent had completed diligence, were comfortable moving forward with a 3.5% termination fee and that Parent planned to send a draft equity commitment letter soon. However, Parent noted that it had not yet been able to confirm when Elliott’s investment committee would meet to consider the transaction.

Also on September 10, 2023, Party X informed Goldman Sachs representatives that Party X and its advisors were developing a proposal that did not include a minimum dividend condition, and that it was therefore critical for Party X to be able to discuss dividend policy with National Western Life’s insurance regulator in Colorado.

On September 11, 2023, Party X sent Goldman Sachs an updated proposal with a total equity value of $1.9 million (approximately $500 per share). The revised proposal did not eliminate the minimum dividend condition, but reduced it to $500 million. However, Party X’s updated proposal no longer required National Western Life to settle equity grants or pay transaction expenses from its balance sheet. Party X’s updated proposal also requested exclusivity.

On September 12, 2023, the Transaction Committee met with Greg Garrison and representatives from Goldman Sachs and Sidley. The meeting participants discussed Parent’s timing to finalize the transaction. Parent had told Goldman Sachs that it would need two weeks to convene a meeting with Elliott’s investment committee. The meeting participants also discussed the new terms included in Party X’s proposal, including a minimum dividend regulatory

condition with a significant price drop to $1.9 billion. The Sidley representatives confirmed that Parent’s merger agreement was now more workable than Party X’s and that disclosure schedules for Parent’s form of merger agreement were substantially complete. The disclosures schedules for Party X’s merger agreement were still several days from being finished. The Sidley representatives noted that Party X’s counsel had informed them earlier that day that Party X’s counsel had been instructed not to engage further on transaction documents unless Party X was granted exclusivity. After deliberation, the Transaction Committee decided the Company would not agree to exclusivity with either potential counterparty at this time.

On September 13, 2023, Parent sent the revised Parent disclosure schedules to Sidley, including new burdensome conditions. These new burdensome conditions were broad and included, among other requests, a reference to a specified target risk-based capital level.

Also on September 13, 2023, Party X’s board approved its proposed transaction and delegated authority to its executive chairman to finalize the documentation for the transaction.

Also on September 13, 2023, Party Y’s counsel scheduled a call with representatives from Sidley to discuss Party Y’s merger agreement, but eventually rescheduled the call to the next day. At the direction of the Transaction Committee, representatives from Goldman Sachs had a call with Party Y’s financial sponsor and encouraged the financial sponsors to make progress on the merger agreement. The Goldman Sachs representatives emphasized that they were not asking for a merger consideration increase, but wanted to encourage Party Y that it was still possible for Party Y to become the preferred counterparty.

Between September 13, 2023 and October 6, 2023, representatives from Debevoise and Sidley negotiated the Parent disclosure schedules and burdensome conditions.

On September 14, 2023, Parent requested permission from the Company to talk to Arizona insurance regulators about the proposed transaction. Parent also requested that the Transaction Committee stop engaging with other potential counterparties and grant Parent exclusivity until September 27, 2023. Further, Parent’s financial representative confirmed to Goldman Sachs that the Elliott investment committee meeting had been scheduled.

On September 15, 2023, Sidley sent Debevoise a revised draft of the Parent disclosure schedules, including key business terms. Sidley narrowed the scope of several proposed burdensome conditions.

Also on September 15, 2023, Party X provided an update on the progress it had made in connection with the strategic review process. Party X confirmed that it had sufficient financing to move forward with the transaction that it had proposed on September 11th (i.e., the $500 million minimum dividend condition), but that it still needed to perform additional confirmatory due diligence.

Also on September 15, 2023, representatives of Party Y’s counsel followed up with Sidley to say that they were not authorized to discuss the merger agreement.

On September 18, 2023, Sidley reached out to Party X’s counsel to follow up on various due diligence requests. Sidley also sent Party X’s counsel the Company disclosure schedules to the merger agreement.

From September 9, 2023 until September 16, 2023, Debevoise and Baker Botts negotiated the voting and support agreement for the Moody Revocable Trust.

On September 21, 2023, the Transaction Committee met with Greg Garrison and representatives from Goldman Sachs and Sidley. The meeting participants discussed the proposals from Parent and Party X, with a focus on which proposal provided more closing certainty. After deliberation, the Transaction Committee determined to move forward with Parent on a non-exclusive basis as the preferred counterparty and instructed Goldman Sachs to communicate to Parent next steps and the expected timeline to signing. Goldman Sachs was instructed to inform Party X that the Company was moving forward with a different preferred counterparty. Later that day, Goldman Sachs informed Parent of the proposed timeline of the signing of the transaction documents, the relevant regulatory meetings, the communication plan, and the meetings of the Transaction Committee and the National Western board of directors.

Also on September 21, 2023, after the Transaction Committee meeting, representatives from Citi informed Goldman Sachs representatives that the Elliott investment committee meeting had been moved from September 27, 2023 to September 29, 2023 in order to permit one of the Elliott investment committee members to attend Parent’s meeting with the Arizona insurance regulators scheduled for September 27th.

On September 22, 2023, Baker Botts sent Sidley its comments to the voting and support agreement for the Moody Revocable Trust. Sidley forwarded Baker Botts’ comments to Debevoise. Sidley also sent back the Parent disclosure schedules and the revised merger agreement to Debevoise. At the direction of the Transaction Committee, Goldman Sachs informed Party X’s financial advisor that the Company was moving forward with a different party as the preferred counterparty.

On September 24, 2023, Debevoise sent Sidley its revisions of the voting and support agreement for the Moody Revocable Trust. Debevoise rejected Baker Botts’s proposal that the Moody Revocable Trust could terminate the voting and support agreement upon a Change in Recommendation by the National Western board of directors. Debevoise’s representative explained that the voting and support agreement should remain in place unless and until the merger agreement was terminated (including for the National Western board of directors to accept a superior proposal, subject to the payment of the termination fee), even if the board effected a Change in Recommendation. Debevoise also sent back responsive drafts on the proposed burdensome condition language, along with a revised draft of the merger agreement.

On September 25, 2023, the Transaction Committee met with Greg Garrison and representatives from Goldman Sachs and Sidley. The meeting participants discussed the extension of Ross Moody’s Change in Control & Severance Agreement (which would otherwise expire in December 2023), as well as the payment of the customary dividend for 2023. The Transaction Committee agreed that both of those actions should be permitted during the interim operating period between signing and closing. Sidley’s representatives confirmed for the Transaction Committee that they had reached an agreement with Debevoise on the language of the burdensome conditions.

On September 27, 2023, Debevoise received Baker Botts’ revised draft of the voting and support agreement for the Moody Revocable Trust. Debevoise and Baker Botts agreed on the form of voting and support agreement for the Moody Revocable Trust. Specifically, to address the outstanding Change in Recommendation issue, Parent agreed that Moody Revocable Trust’s voting and support agreement would terminate if the National Western board of directors effected a Change in Recommendation relating to an intervening event, but not for a superior proposal. This voting and support agreement modification was limited to the Moody Revocable Trust’s form of voting and support agreement and did not apply to the voting and support agreement to be executed by Ross Moody, Frances Moody-Dahlberg or Russell Moody.

Also on September 27, 2023, representatives from Parent informed Goldman Sachs that the meeting with Elliott’s investment committee had been rescheduled from September 29th to October 5th. The Parent representatives explained that the investment committee meeting needed to be rescheduled because the Company had recently posted a significant number of new due diligence documents, and Parent and its advisors needed time to review those documents. Representatives from Parent also informed Goldman Sachs representatives that Parent had informed the Arizona insurance regulators about the potential transaction.

On September 28, 2023, the Transaction Committee met with Greg Garrison and representatives from Goldman Sachs and Sidley. The meeting participants discussed Parent’s updated timing, including moving the Elliott investment committee meeting from September 29th to October 5th. In light of this additional delay, the Transaction Committee discussed whether to reengage with Party X. However, the Transaction Committee determined that a transaction with Party X would likely not be signed any faster than a transaction with Parent. The Transaction Committee also acknowledged that, based on Party X’s prior comments, Party X was likely to insist on exclusivity in order to reengage. If so, then the Company would be precluded from continuing to engage with Parent during the exclusivity period. At the meeting, the parties also discussed a potential amendment to the Bylaws of the Company (the “Company Bylaws”) to include a provision that Delaware would be the exclusive forum for all fiduciary duty lawsuits related to the Company.

On September 29, 2023, Sidley sent a revised draft of the merger agreement to Debevoise.

On October 2, 2023, Debevoise sent a revised draft of the merger agreement to Sidley.

On October 3, 2023, Parent’s representatives informed representatives from Goldman Sachs and Sidley that Parent had discovered certain annuity underpayments and actuarial appraisal errors that adversely affected the value of the Company. Parent’s representatives indicated that Parent believed a $20 million merger consideration reduction was needed in order to address the reduction in value. Goldman Sachs, Sidley, Milliman and the senior management team discussed these errors, and the senior management team acknowledged that, though inadvertent, the errors had occurred. Later that day, Sidley sent the draft press release announcing the transaction to Debevoise.

On October 4, 2023, the Transaction Committee met to discuss Parent’s request for a merger consideration reduction, as well as timing. In attendance, in addition to the Transaction Committee, were Greg Garrison and representatives from Goldman Sachs and Sidley. At the meeting, the meeting participants discussed Parent’s new timeline for the signing of the merger agreement and the announcement of the transaction. Sidley explained that the National Western board of directors would need to meet to approve the transaction prior to making an announcement. The parties also discussed Parent’s demand for a price reduction due to the annuity underpayment issue and the adjustment to the actuarial appraisal to correctly factor in the ongoing nature of trailing commissions. Parent proposed reducing the offer price to $500 per share, reflecting a total reduction in merger consideration of approximately $20 million. The Transaction Committee instructed representatives of Goldman Sachs to request that Parent reduce the size of the reduction by the amount of the income tax benefit of the annuity underpayment and actuarial appraisal reduction. However, the Transaction Committee acknowledged that a mistake had been made by the Company. The Transaction Committee authorized Goldman Sachs to accept Parent’s proposal if Parent pushed back on the request to tax-effect the merger consideration reduction. Following the discussion with the Transaction Committee, Goldman Sachs requested that Parent consider giving National Western the benefit of the tax savings relating to the errors, but Parent responded that it was not able to agree to that request.

Final Approvals and Execution of the Merger Agreement

On October 5, 2023, the Transaction Committee met to discuss the outcome of Elliott’s investment committee meeting and the remaining steps necessary for signing the merger agreement. In attendance, in addition to the Transaction Committee, were Greg Garrison and representatives from Goldman Sachs and Sidley. At the meeting, Goldman Sachs gave the Transaction Committee an update on Elliott’s investment committee’s meeting, which was communicated to representatives of Goldman Sachs by Citi. Goldman Sachs also gave the Transaction Committee a presentation of the financial analyses of the Company and the proposed transaction with Parent. This presentation was intended to be substantially similar to the presentation to be given to the National Western board of directors on October 8, 2023, subject only to updating market prices. Later that day, at Parent’s request, Company management and Parent participated in calls with the Company’s insurance regulators, previewing the transaction and introducing them to Parent. During the course of the discussion with the Missouri insurance regulators, Parent and the Company learned that Continental General had filed a Form A in Missouri on September 29, 2023. Also on October 5th, a representative from the Company previewed the transaction with the Company’s rating agencies.

On October 6, 2023, Parent and Debevoise participated in calls with the Parent’s insurance regulators and rating agencies, previewing the transaction. Further, representatives from Sidley, the Company, Parent and Debevoise finalized the definitive agreements with respect to the merger, including the Company disclosure schedules, along with the relevant voting and support agreements, Form 8-K and the press release.

On October 8, 2023, the National Western board of directors and the Transaction Committee held a joint special meeting. In attendance, in addition to the directors, were Rey Perez, Gina Miller, Brian Pribyl, Joey Hathaway, Greg Garrison, and representatives from Sidley and Goldman Sachs. Because of the interrelated nature of the matters to be considered at the meeting of the National Western board of directors and the meeting of the Transaction Committee, this meeting was a joint meeting of the board and the Transaction Committee. Sidley confirmed that the merger agreement and the voting and support agreements for Ross Moody, Frances Moody-Dahlberg, Russell Moody and the Moody Revocable Trust had been finalized. Goldman Sachs then presented its financial analysis of the Company and of the merger consideration. Next, Sidley summarized the strategic review process and the potential next steps. Sidley also reviewed with meeting participants the final merger agreement under consideration for approval. Sidley explained that the Delaware General Corporation Law permits Delaware corporations to designate Delaware as the exclusive forum for any fiduciary lawsuits brought on behalf of stockholders. Accordingly, Sidley recommended that the National Western board of directors amend the Company Bylaws to include a provision that requires all fiduciary duty litigation — including any lawsuits related to a merger transaction — be brought in Delaware. Further, Goldman Sachs rendered an oral opinion, confirmed by delivery of a written opinion dated October 8, 2023, to the National Western board of directors to the effect that, as of such date and based on and subject to various factors and assumptions set forth in Goldman Sachs’ written opinion, the merger consideration to be received by holders (other than Parent or its affiliates) of Company common stock, taken in the aggregate, pursuant to the merger agreement was fair, from a financial point of view, to such holders of Company common stock.

Following the presentation from Goldman Sachs, Sidley described the proposed resolutions of the Transaction Committee that had been distributed to the Transaction Committee prior to the meeting. The Transaction Committee noted that it had had the opportunity to review the proposed resolutions of the Transaction Committee, the finalized

merger agreement and the summaries of the merger agreement. After discussion, upon a motion duly made and seconded, the Transaction Committee unanimously resolved (a) that, the merger agreement and the transactions contemplated thereby, including the merger, were fair to, and in the best interests of, the Company and its stockholders and (b) to recommend that the National Western board of directors approve and declare advisable the merger agreement and the transactions contemplated thereby, including the merger.

Sidley then described the proposed resolutions of the National Western board of directors that had been previously distributed to the directors. The directors confirmed that they had had the opportunity to review the proposed resolutions of the National Western board of directors, the finalized merger agreement and the summaries of the merger agreement. After discussion, and noting the Transaction Committee’s recommendation, and upon motion duly made and seconded, the National Western board of directors unanimously (i) approved and declared advisable the merger agreement and the transactions contemplated thereby, including the merger, and the consummation by the Company of the transactions contemplated by the merger agreement, including the merger, on the terms and subject to the conditions set forth in the merger agreement, (ii) determined that, on the terms and subject to the conditions set forth in the merger agreement and the transactions contemplated thereby, including the merger, were fair to, and in the best interests of, the Company and its stockholders, (iii) determined that the execution, delivery and performance of the merger agreement, in substantially the form presented to the National Western board of directors, and, subject to the affirmative vote of holders of a majority of the outstanding shares of Company common stock in favor of the adoption of the merger agreement, the consummation by the Company of the transactions contemplated thereby, including the merger were authorized and approved, (iv) recommended that the stockholders of the Company vote for the adoption of the merger agreement and (v) amended and restated the Company Bylaws to designate the state and federal courts of the State of Delaware as the exclusive forum for certain suits relating to internal corporate governance and other matters.

On October 9, 2023, the transaction was announced by way of a joint press release by the Company and Parent before NASDAQ opened for trading.

National Western’s Reasons for the Merger

In the course of the National Western board of directors making the determinations described above in the section titled “The Special Meeting — Recommendation of the National Western Board of Directors” beginning on page 20, the National Western board of directors (i) consulted with the Company’s legal and financial advisors and the Company’s senior management team, (ii) took into account the recommendation of the Transaction Committee, and (iii) considered the following potentially positive factors, which are not intended to be exhaustive and are not presented in any relative order of importance:

•        The merger consideration to be paid by Parent would provide National Western’s stockholders with the opportunity to receive a meaningful premium over the current market price of the Class A common stock. The National Western board of directors reviewed current and historical market prices with respect to the Class A common stock, including the fact that the merger consideration represented:

•        an 87.1% premium to National Western’s last unaffected closing stock price of $267.29 per share on May 16, 2023, the date the Company announced that the National Western board of directors was exploring strategic alternatives;

•        a 35.9% premium to National Western’s all-time high stock price prior to National Western’s May 16, 2023 announcement ($368.00 per share on October 16, 2017);

•        a 129.5% premium to National Western’s closing stock price of $217.82 per share on December 8, 2022, the last trading day prior to unusual trading activity (both in terms of price and volume) in the Class A common stock following the conclusion of the Transaction Committee’s process for selecting a financial advisor for the Company, as described above in the section titled “— Background of the Merger — Establishing the Transaction Committee and Selecting Advisors”;

•        an 11.8% premium over National Western’s 30-day volume-weighted average price as of October 6, 2023, the last trading day prior to the signing of the merger agreement; and

•        a 19.8% premium to National Western’s closing stock price of $417.19 per share on October 6, 2023, the last trading day prior to the signing of the merger agreement.

•        The fact that the merger consideration would be paid solely in cash, which provides certainty and immediate liquidity and value to holders of shares of Company common stock, enabling holders of shares of Company common stock to realize value that has been created at National Western while eliminating long-term business and execution risk.

•        The fact that the merger agreement allows National Western to continue to declare and pay regular annual cash dividends on the Class A common stock of up to $0.36 per share (and up to $0.18 per share for the Class B common stock) during the period prior to closing.

•        The following considerations relating to the financing of the transactions contemplated by the merger agreement:

•        The absence of any financing condition or contingency to the merger;

•        The absence of any closing condition requiring regulatory approval of the payment of a minimum dividend by National Western Life or Ozark National Life, either before closing or after closing;

•        The fact that the total merger consideration of approximately $1.9 billion will be funded through a combination of (i) cash from internal sources, (ii) a capital commitment from affiliates of Elliott Investment Management L.P. (“Elliott”) to Parent and Prosperity Group Holdings LP, a Bermuda limited partnership and indirect 100% parent of Parent (“PGH LP”) and (iii) borrowings under existing facilities or debt commitments, the aggregate proceeds of which will provide Parent with the funds needed to consummate the merger, including to pay the aggregate merger consideration pursuant to the merger agreement;

•        The business reputation and capabilities of Parent and its management, as well as the financial resources of Parent; and

•        The terms of the merger agreement, including the following:

•        The Company and its legal and financial advisors, acting at the direction of the Transaction Committee, negotiated the terms and conditions of the merger agreement (primarily focused on provisions to increase certainty of closing) on an arm’s-length basis with Parent and its legal counsel;

•        The National Western board of directors considered that the provisions of the merger agreement, including the respective representations, warranties and covenants and termination rights of the parties and termination fees payable by the Company, are reasonable and customary;

•        The belief of the National Western board of directors that the terms of the merger agreement include the most favorable terms reasonably attainable from Parent;

•        The belief of the National Western board of directors that, based on consultation with National Western’s outside legal counsel, the conditions to the consummation of the merger as set forth in the merger agreement are reasonable and customary;

•        The provisions of the merger agreement that allow the outside date for completing the merger to be extended to October 8, 2024 if the merger has not been completed by the initial outside date of July 8, 2024 because the required regulatory approvals have not been obtained;

•        Parent’s commitment in the merger agreement to use its reasonable best efforts to consummate the merger (subject to the terms and conditions of the merger agreement, including that no Burdensome Conditions are imposed by any regulatory authority);

•        The fact that the merger agreement does not preclude a third party from making an unsolicited proposal for a competing transaction with National Western and, under certain circumstances more fully described in the section titled “The Merger Agreement — Competing Proposals” beginning on page 76:

•        National Western may furnish non-public information to and discuss the competing transaction with the third party;

•        the National Western board of directors may withdraw or modify its recommendations to National Western stockholders regarding the merger in response to an unsolicited proposal for a competing transaction; and

•        the National Western board of directors may terminate the merger agreement if it determines that the competing proposal is a superior proposal and that it would be inconsistent with the National Western board of directors’ fiduciary duties not to terminate the merger agreement in order to accept the superior proposal;

•        National Western’s ability, under certain circumstances pursuant to the merger agreement, to seek specific performance to prevent breaches of the merger agreement, and to enforce specifically the terms of the merger agreement and Elliott equity commitment letter, as described under the section titled “The Merger Agreement — Specific Performance” beginning on page 85; and

•        The termination fee of $66,500,000 is consistent with fees in comparable transactions and reasonable in amount in light of the circumstances in which the termination fee could become payable to Parent.

•        The fact that the Supporting Stockholders, which together own approximately 29.68% of the total shares of Class A common stock and Class B common stock, have executed voting and support agreements in which they have agreed to approve and adopt the merger agreement, including:

•        Ross Moody, Chairman of the Board, Chief Executive Officer and a director of the Company;

•        Frances Moody-Dahlberg, a director of the Company;

•        Russell Moody, an advisory director of the Company; and

•        the Moody Revocable Trust, the holder of legal title and voting control with respect to 99% of the outstanding shares of Class B common stock.

•        The fact that the National Western board of directors formed the Transaction Committee for the purposes of exploring strategic opportunities, as a result of which (i) the process was directed by the National Western board of directors, either directly or acting through the Transaction Committee, and (ii) all of the Company’s stockholders were able to receive their pro rata share of the control premium through a whole company sale.

•        The fact that, on May 16, 2023, the Company publicly announced that the National Western board of directors was exploring strategic alternatives and had engaged Goldman Sachs to serve as its financial advisor for that purpose, which gave any interested potential counterparty that had not otherwise been contacted in connection with the Company’s third-party solicitation process an opportunity to inquire about the process.

•        The fact that, following the May 16, 2023 announcement, five additional parties did reach out to representatives of Goldman Sachs to express potential interest in participating in the strategic review process, each of those five parties executed confidentiality agreements, and one of those parties submitted a first-round proposal, but was not advanced to the second round of the process.

•        As described under the section titled “— Background of the Merger” beginning on page 25, the fact that the Company, at the direction of the National Western board of directors, acting through the Transaction Committee, conducted a thorough strategic review process, in which:

•        68 potential counterparties, including 38 strategic parties and 30 financial sponsors, were contacted to gauge their interest in making a proposal to acquire National Western;

•        45 of those 68 parties signed confidentiality agreements and received a confidential information memorandum relating to National Western;

•        Even though the Company expressed a strong preference for cash consideration in the proposal submission instructions, potential counterparties were not limited in the form of consideration they could propose;

•        A total of 15 indications of interest were received by the Company in the first round;

•        At the direction of the Transaction Committee, seven potential counterparties advanced to the second round, at which point each potential counterparty received a management presentation and access to the Company’s virtual data room;

•        A total of four second-round proposals were received by the Company, including three conforming proposals and one non-conforming proposal;

•        Each of the three potential counterparties that submitted a conforming proposal also submitted a mark-up of the merger agreement that the Company posted to the virtual data room for the strategic review process;

•        Each of those three potential counterparties conducted additional confirmatory due diligence and entered a third and final round on or about August 31, 2023;

•        Parent’s proposal to acquire National Western indicated that the proposal would be fully financed, without any financing condition, did not require approval by any regulatory authority of a pre-closing or post-closing dividend, and provided the greatest certainty of consummation of the merger as compared to the other proposals in the third round; and

•        After each of the three potential counterparties in the third round had clarified its proposal and attempted to provide assurances regarding certainty of consummation, Parent’s proposal to acquire National Western for $500.00 per share was the highest price proposed in the third round.

•        Parent requested exclusivity but continued to negotiate and finalize the merger agreement during the third round of the process, even though the Company never granted exclusivity to Parent, thereby leaving the National Western board of directors with the ability, through the Transaction Committee and the Company’s financial and legal advisors, to negotiate with other potential counterparties during that period if the Transaction Committee determined it would be in the best interest of the Company’s stockholders to do so.

•        The stated position of Parent, in connection with the negotiation of the exclusivity agreement, that the merger consideration was the highest price per share of Company common stock that Parent would agree to.

•        The fact that, under the Company’s certificate of incorporation, the differences between the Class A common stock and Class B common stock do not apply in the context of the merger:

•        The holders of Class A common stock and Class B common stock do not have separate class votes with respect to the adoption of the merger agreement, but instead will vote together as a single class on that matter;

•        The payment by Parent of the merger consideration pursuant to the merger agreement is not a dividend or distribution by the Company, so the 50% discount that applies to the Class B common stock under the Company’s certificate of incorporation does not apply to the merger; and

•        The merger is not a liquidation, so the Class A common stock’s de minimis liquidation preference of $0.01 per share does not apply to the merger.

•        The fact that the Transaction Committee had met to discuss and evaluate the Company’s exploration of potential strategic alternatives over 40 times from October 21, 2022 (the date the Transaction Committee was established) until October 8, 2023 (the date the merger agreement was executed) and, during that period, conducted those discussions and evaluations in consultation with the Company’s management and legal and financial advisors.

•        The fact that the National Western board of directors had met to discuss and evaluate the Company’s exploration of potential strategic alternatives three times from October 21, 2022 (the date the Transaction Committee was established) until October 8, 2023 (the date the merger agreement was executed) and, during that period, conducted those discussions and evaluations in consultation with the Company’s management and legal and financial advisors.

•        The National Western board of directors’ belief, based on, among other things, its familiarity with the Company’s business, the result of the negotiations between the parties and the responses of other potential acquirers contacted in connection with the Company’s third-party solicitation process, that other potentially interested parties, if any, would not likely be prepared to earnestly pursue a transaction with the Company for a price in excess of the merger consideration.

•        The conclusion reached by the National Western board of directors, after discussions with the Company’s management and financial advisors and negotiations with Parent, that the merger consideration of $500.00 was likely the highest price per share that Parent was willing to pay and that the combination of public disclosure of the merger consideration and the ability to respond to unsolicited proposals for competing transactions (as further described in the section titled “The Merger Agreement — Competing Proposals” beginning on page 76) would likely result in a sale of the Company at the highest price per share that was reasonably attainable.

•        The National Western board of directors received the opinion of Goldman Sachs delivered to the National Western board of directors that, as of October 8, 2023 and based upon and subject to the factors and assumptions set forth therein, the $500 in cash per share of Company common stock, without interest, to be paid to the holders (other than Parent and its affiliates) of Company common stock, taken in the aggregate, pursuant to the merger agreement was fair from a financial point of view to such holders of Company common stock, which opinion is set forth on Annex B and described below more fully in the section titled “— Opinion of National Western’s Financial Advisor.”

•        The National Western board of directors’ belief that the merger would likely be consummated in accordance with the merger agreement.

•        The availability of appraisal rights with respect to the merger for holders of Company common stock who timely and properly exercise their rights under the DGCL, which would give these stockholders the ability to seek and be paid a judicially determined appraisal of the “fair value” of their shares of Company common stock following completion of the merger (see the section titled “Appraisal Rights” and Annex C).

The National Western board of directors also considered and balanced the factors described above against certain negative factors and potential risks associated with the merger, including the following factors, which are not intended to be exhaustive and are not presented in any relative order of importance:

•        The fact that, following the merger, the Company will no longer exist as an independent public company and the Company’s existing stockholders will not participate in the Company’s or Parent’s future earnings or growth or benefit from any synergies (other than synergies reflected in the purchase price) resulting from the consummation of the transactions contemplated by the merger agreement.

•        The fact that Goldman Sachs’ opinion to the National Western board of directors as to fairness, as of October 8, 2023, of the aggregate merger consideration to be received by all stockholders (based upon and subject to the factors and assumptions set forth therein) only considered the fairness of such consideration taken in the aggregate and did not consider the allocation of the aggregate merger consideration among the holders of Class A common stock and Class B common stock.

•        The possibility that the merger might not be consummated or that the consummation might be delayed.

•        The amount of time it could take from the date the merger agreement was signed to obtain regulatory approval and complete the transactions, including that an extended period of time may exacerbate the impact of other risks considered by the National Western board of directors described in this section of this proxy statement.

•        The fact that the merger is subject to a number of closing conditions, some of which are outside of the Company’s control.

•        The fact that the merger is subject to approval by insurance regulators in Colorado and Arizona of the redomestication of National Western Life from Colorado to Arizona.

•        The risk that regulators may seek to impose conditions, limitations, obligations or costs, or place restrictions on the conduct of Parent’s or National Western’s business, which could have the effect of (i) delaying the completion of any of the transactions or (ii) if they constitute Burdensome Conditions, cause one of the merger agreement’s closing conditions to be incapable of being satisfied.

•        The fact that, because the merger consideration consists solely of cash, the transaction is taxable to the Company’s stockholders.

•        The fact that the announcement and pendency of the merger, or the failure to complete the merger, may result in significant costs to the Company and cause substantial harm to the Company’s relationships with its employees (including making it more difficult to attract and retain key personnel and the possible loss of key management and other personnel), agents, customers and other business partners.

•        The substantial time and effort of management required to consummate the merger, which could disrupt the Company’s business operations and divert employees’ attention away from the Company’s day-to-day operations.

•        The risk that, despite certain retention efforts prior to consummation of the merger, the Company may lose key employees.

•        The fact that restrictions on the conduct of National Western’s business prior to consummation of the merger could delay or prevent National Western from undertaking business opportunities that arise pending consummation of the merger, which opportunities might be lost to National Western if the merger could not be consummated.

•        The restrictions on the Company’s ability to solicit for or respond to proposals for competing transactions.

•        The fact that, under certain circumstances, including if (i) the Parent terminates the merger agreement because the National Western board of directors changes its recommendation, or (ii) the Company terminates the merger agreement in order to enter into a definitive agreement with respect to a Superior Proposal (as further described in the section titled “The Merger — Termination Fees and Expenses”), the Company would be required to pay Parent a $66,500,000 termination fee upon termination of the merger agreement.

•        The substantial costs being incurred in connection with the transactions contemplated by the merger agreement.

During its consideration of the transaction with Parent, the National Western board of directors was also aware of and considered that the Company’s directors and executive officers may have interests in the merger that differ from, or are in addition to, their interests as stockholders of the Company generally, as described in the section titled “The Merger — Interests of National Western Directors and Executive Officers in the Merger” beginning on page 54.

After taking into account all of the factors set forth above, as well as others, the National Western board of directors determined that the potentially positive factors outweighed the potentially negative factors. The foregoing discussion of the factors considered by the National Western board of directors is not intended to be exhaustive, but summarizes the material information and factors considered by the National Western board of directors in its consideration of the merger. The National Western board of directors reached the decision to recommend, adopt and approve the merger agreement, the merger and the other transactions contemplated by the merger agreement, in light of the factors described above and other factors the National Western board of directors determined were appropriate. In view of the variety of factors and the quality and amount of information considered, the National Western board of directors did not find it practicable to and did not quantify or otherwise assign relative weights to the specific factors considered in reaching its determination and individual members of the National Western board of directors may have given different weights to different factors. The National Western board of directors conducted an overall review of the factors described above, including discussions with the Company’s management and legal and financial advisors, and considered the factors overall to be favorable to, and to support, its determinations. It should be noted that this explanation of the reasoning of the National Western board of directors and certain information presented in this section is forward-looking in nature and should be read in light of the factors set forth in the section titled “Special Note Regarding Forward-Looking Statements” beginning on page 17.

Opinion of National Western’s Financial Advisor

Goldman Sachs rendered its opinion to the Company’s board of directors that, as of October 8, 2023 and based upon and subject to the factors and assumptions set forth therein, the $500.00 in cash per share of Company common stock, without interest, to be paid to the holders (other than Parent and its affiliates) of Company common stock, taken in the aggregate, pursuant to the merger agreement was fair from a financial point of view to such holders of Company common stock.

The full text of the written opinion of Goldman Sachs, dated October 8, 2023, which sets forth assumptions made, procedures followed, matters considered and limitations on the review undertaken in connection with the opinion, is attached as Annex B. Goldman Sachs provided advisory services and its opinion for the information and assistance of the Company’s board of directors in connection with its consideration of the merger. Goldman Sachs’ opinion is not a recommendation as to how any holder of Company common stock should vote with respect to the merger or any other matter.

In connection with rendering the opinion described above and performing its related financial analyses, Goldman Sachs reviewed, among other things:

•        the merger agreement;

•        annual reports to stockholders and Annual Reports on Form 10-K of the Company for the five years ended December 31, 2022;

•        certain interim reports to stockholders and Quarterly Reports on Form 10-Q of the Company;

•        certain other communications from the Company to its stockholders; and

•        certain internal financial analyses and forecasts for the Company prepared by its management, as approved for Goldman Sachs’ use by the Company (the “Forecasts”).

Goldman Sachs also held discussions with members of the senior management of the Company regarding their assessment of the past and current business operations, financial condition and future prospects of the Company; reviewed the reported price and trading activity for the Class A common stock; compared certain financial and stock market information for the Company with similar information for certain other companies the securities of which are publicly traded; reviewed the financial terms of certain recent business combinations in the life insurance industry and in other industries; and performed such other studies and analyses, and considered such other factors, as Goldman Sachs deemed appropriate.

For purposes of rendering this opinion, Goldman Sachs, with the Company’s consent, relied upon and assumed the accuracy and completeness of all of the financial, legal, regulatory, tax, accounting and other information provided to, discussed with or reviewed by, it, without assuming any responsibility for independent verification thereof. In that regard, Goldman Sachs assumed with the Company’s consent that the Forecasts were reasonably prepared on a basis reflecting the best currently available estimates and judgments of the management of the Company. Goldman Sachs did not make an independent evaluation or appraisal of the assets and liabilities (including any contingent, derivative or other off-balance-sheet assets and liabilities) of the Company or any of its subsidiaries and, except for an appraisal report provided by the Company, it was not furnished with any such evaluation or appraisal. Goldman Sachs is not an actuary and Goldman Sachs’ services did not include any actuarial determination or evaluation by Goldman Sachs or any attempt to evaluate actuarial assumptions and Goldman Sachs relied on the Company’s actuaries with respect to reserve adequacy. In that regard, Goldman Sachs made no analysis of, and expressed no opinion as to, the adequacy of the reserves or the embedded value of the Company. Goldman Sachs assumed that all governmental, regulatory or other consents and approvals necessary for the consummation of the merger will be obtained without any adverse effect on the expected benefits of the merger in any way meaningful to its analysis. Goldman Sachs also assumed that the merger will be consummated on the terms set forth in the merger agreement, without the waiver or modification of any term or condition the effect of which would be in any way meaningful to its analysis.

Goldman Sachs’ opinion does not address the underlying business decision of the Company to engage in the merger or the relative merits of the merger as compared to any strategic alternatives that may be available to the Company; nor does it address any legal, regulatory, tax or accounting matters. Goldman Sachs’ opinion addresses only the fairness from a financial point of view, as of the date of the opinion, of the $500.00 in cash per share of Company

common stock to be paid to the holders (other than Parent and its affiliates) of Company common stock, taken in the aggregate, as of the date of such opinion, pursuant to the merger agreement. Goldman Sachs’ opinion does not express any view on, and does not address, any other term or aspect of the merger agreement or the merger or any term or aspect of any other agreement or instrument contemplated by the merger agreement or entered into or amended in connection with the merger, including the fairness of the merger to, or any consideration received in connection therewith by, the holders of any other class of securities, creditors, or other constituencies of the Company; nor as to the fairness of the amount or nature of any compensation to be paid or payable to any of the officers, directors or employees of the Company, or class of such persons, in connection with the merger, whether relative to the $500.00 in cash per share of Company common stock, without interest, to be paid to the holders (other than Parent and its affiliates) of Company common stock, taken in the aggregate, pursuant to the merger agreement or otherwise; nor as to fairness with respect to the allocation of the aggregate consideration payable pursuant to the merger agreement, including among the holders of the Class A common stock and the Class B common stock pursuant to the merger agreement. Goldman Sachs’ opinion is necessarily based on economic, monetary, market and other conditions as in effect on, and the information made available to Goldman Sachs as of, the date of its opinion and Goldman Sachs assumes no responsibility for updating, revising or reaffirming its opinion based on circumstances, developments or events occurring after the date of its opinion. Goldman Sachs does not express any opinion as to the potential effects of volatility in the credit, financial and stock markets on the Company, Parent or the merger, or as to the impact of the merger on the solvency or viability of the Company or Parent or the ability of the Company or Parent to pay their respective obligations when they come due. Goldman Sachs’ opinion was approved by a fairness committee of Goldman Sachs.

The following is a summary of the material financial analyses delivered by Goldman Sachs to the Company’s board of directors in connection with rendering the opinion described above. The following summary, however, does not purport to be a complete description of the financial analyses performed by Goldman Sachs, nor does the order of analyses described represent relative importance or weight given to those analyses by Goldman Sachs. Some of the summaries of the financial analyses include information presented in tabular format. The tables must be read together with the full text of each summary and are alone not a complete description of Goldman Sachs’ financial analyses. Except as otherwise noted, the following quantitative information, to the extent that it is based on market data, is based on market data as it existed on or before October 6, 2023, and is not necessarily indicative of current market conditions.

Analysis of Implied Premiums

Goldman Sachs analyzed the consideration to be paid to holders of Company common stock pursuant to the merger agreement in relation to:

•        $267.29, the closing price of the Company common stock on May 16, 2023, the last full trading day prior to the Company announcing its exploration of strategic alternatives (the “Share Price Prior to Announcement of Strategic Review”);

•        $444.99, the closing price of the Company common stock on August 8, 2023, the last full trading day prior to the second-round deadline for proposals (the “Share Price Prior to Second Round Proposals”);

•        $417.19, the closing price of the Company common stock on October 6, 2023 (the “Current Share Price”);

•        $257.59, the volume weighted average price (the “VWAP”) of the Company common stock over the 30 trading-day period ended May 16, 2023 (the “Pre-Strategic Review 30-Day VWAP”);

•        $447.25, the VWAP of the Company common stock over the 30 trading-day period ended October 6, 2023 (the “30-Day VWAP”);

•        $292.09, the highest closing trading price of the Company common stock for the 52-week period ended May 16, 2023 (the “Pre-Strategic Review 52-Week High Price”); and

•        $368.00, the all-time highest closing price of the Company common stock prior to the Company determining to explore strategic alternatives on October 21, 2022 (the “Pre-Strategic Review All-Time High Price”).

This analysis indicated that the price per share of Company common stock to be paid to the holders of Company common stock pursuant to the merger agreement represented implied premiums as set forth in the table below:

Illustrative Dividend Discount Model

Using the Forecasts, Goldman Sachs performed an illustrative dividend discount analysis on the Company to derive a range of illustrative values per share of Company common stock. Goldman Sachs discounted the estimated capital return to stockholders from the Company for the period of the third quarter of 2023 through 2027, as reflected in the Forecasts, and the range of terminal values to derive present values, as of June 30, 2023, for the Company. Goldman Sachs calculated a range of terminal values for the Company by applying P/BV multiples ranging from 0.30x to 0.60x the projected book value of the Company common stock, excluding accumulated other comprehensive income of the Company (“AOCI”) of $(479.81) million as set forth in the Forecasts. These illustrative P/BV multiple estimates were derived by Goldman Sachs utilizing its professional judgment and experience, taking into account, among other things, the current and historical observed P/BV multiples for the Company. Goldman Sachs used a range of discount rates from 8.75% to 10.75%, reflecting estimates of the Company’s cost of equity. Goldman Sachs derived such estimated cost of equity by application of the Capital Asset Pricing Model (“CAPM”), which requires certain company-specific inputs, including a beta for the Company, as well as certain financial metrics for the United States financial markets generally. Goldman Sachs then divided the range of illustrative present values it derived for the Company by the number of fully diluted outstanding shares of Company common stock estimated to be outstanding using the treasury stock method, as provided by the Company’s management, which implied a value of $171 to $360 per share of Company common stock (rounded to the nearest whole dollar).

Illustrative Present Value of Future Share Price Analysis

Using the Forecasts, Goldman Sachs performed an illustrative analysis of the implied present value of an illustrative future value per share of Company common stock. For this analysis, Goldman Sachs first calculated and implied a range of theoretical future values per share of Company common stock as of December 31, 2023 through December 31, 2025, by applying illustrative P/BV multiples ranging from 0.30x to 0.60x to the Company’s projected book value per share of Company common stock (excluding AOCI) as of December 31 of each such year included in the Forecasts. These illustrative multiples were derived by Goldman Sachs utilizing its professional judgment and experience, taking into account current and historical P/BV multiples for the Company. Goldman Sachs then discounted to present value as of June 30, 2023 both the theoretical range of future values per share it derived for the Company and the estimated distributions to be paid per share of Company common stock through the end of the applicable period as reflected in the Forecasts using a discount rate of 9.75%, reflecting the midpoint of an estimated range of the Company’s cost of equity. Goldman Sachs derived such estimated cost of equity by application of the CAPM, which requires certain company-specific inputs, including a beta for the Company, as well as certain financial metrics for the United States financial markets generally. This analysis resulted in a range of implied present values of $198 to $424 per share of Company common stock (rounded to the nearest whole dollar).

Selected Transactions Analysis

Goldman Sachs analyzed certain information relating to the following seven selected transactions in the life insurance industry since 2018 involving target companies with a total equity value of more than $1 billion. For each of the selected transactions, Goldman Sachs calculated and compared the implied total equity value of the applicable

target company based on the consideration paid in the transaction as a multiple of the target company’s book value (excluding AOCI) as reported or calculated using publicly available information for the most recent financial period reporting date prior to the announcement (the “P/BV multiples”) of the applicable transaction. While none of the companies that participated in the selected transactions is directly comparable to the Company, the companies that participated in the selected transactions are companies with operations that, for the purposes of analysis, may be considered similar to certain of the Company’s results, market sizes and product profile.

The following table presents the results of this analysis:

____________

(1)      Represents implied total equity value for 100% of the business acquired.

(2)      May 3, 2021 was the date Farm Bureau P&C increased its offer price. The initial announcement that the parties had entered into a definitive transaction agreement was made on January 11, 2021.

Based on the results of the foregoing P/BV multiples and Goldman Sachs’ professional judgment and experience, Goldman Sachs applied a reference range of P/BV (excluding AOCI) multiples of 0.78x to 1.77x (representing the low and high premium, respectively, of the implied P/BV multiples calculated for the transactions above) to the Company’s book value (excluding AOCI) of $2.711 billion as of June 30, 2023 to derive a range of implied values per share of Company common stock of $552 to $1,238 (rounded to the nearest whole dollar).

Premia Paid Analysis

Goldman Sachs reviewed and analyzed, using publicly available information, the acquisition premia for all-cash acquisition transactions completed or pending in the five years preceding October 6, 2023 involving a public company based in the United States as the target where the disclosed equity values for the transaction were between $1 billion and $3 billion. For the entire period, using publicly available information, Goldman Sachs calculated the median, 25th percentile and 75th percentile premiums of the price paid in the 141 transactions relative to the target’s last undisturbed closing stock price prior to announcement of the transaction. This analysis indicated a 25th percentile premium of 15.7%, a median premium of 30.3% and 75th percentile premium of 59.2% across the period. Using this analysis, Goldman Sachs applied a reference range of illustrative premiums of 15.7% to 59.2% to the Company’s undisturbed closing price per share of Company common stock of $267.29 as of May 16, 2023, and calculated a range of implied equity values for the Company of $309 to $426 per share of Company common stock (rounded to the nearest whole dollar).

General

The preparation of a fairness opinion is a complex process and is not necessarily susceptible to partial analysis or summary description. Selecting portions of the analyses or of the summary set forth above, without considering the analyses as a whole, could create an incomplete view of the processes underlying Goldman Sachs’ opinion. In arriving at its fairness determination, Goldman Sachs considered the results of all of its analyses and did not attribute any particular weight to any factor or analysis considered by it. Rather, Goldman Sachs made its determination as to fairness on the basis of its experience and professional judgment after considering the results of all of its analyses. No company or transaction used in the above analyses as a comparison is directly comparable to the Company or Parent or the contemplated transaction.

Goldman Sachs prepared these analyses for purposes of Goldman Sachs’ providing its opinion to the Company’s board of directors as to the fairness from a financial point of view of the holders (other than Parent and its affiliates) of Company common stock of the $500.00 in cash per share of Company common stock, without interest, to be paid to such holders, taken in the aggregate, pursuant to the merger agreement. These analyses do not purport to be appraisals nor do they necessarily reflect the prices at which businesses or securities actually may be sold. Analyses based upon forecasts of future results are not necessarily indicative of actual future results, which may be significantly more or less favorable than suggested by these analyses. Because these analyses are inherently subject to uncertainty, being based upon numerous factors or events beyond the control of the parties or their respective advisors, none of the Company, Parent, Goldman Sachs or any other person assumes responsibility if future results are materially different from those forecast.

The merger consideration was determined through arm’s-length negotiations between the Company and Parent and was approved by the Company’s board of directors. Goldman Sachs provided advice to the Company during these negotiations. Goldman Sachs did not, however, recommend any specific amount of consideration to the Company or its board of directors or that any specific amount of consideration constituted the only appropriate consideration for the merger.

As described above, Goldman Sachs’ opinion to the Company’s board of directors was one of many factors taken into consideration by the Company’s board of directors in making its determination to approve the merger agreement. The foregoing summary does not purport to be a complete description of the analyses performed by Goldman Sachs in connection with the fairness opinion and is qualified in its entirety by reference to the written opinion of Goldman Sachs attached as Annex B.

Goldman Sachs and its affiliates are engaged in advisory, underwriting, lending and financing, principal investing, sales and trading, research, investment management and other financial and non-financial activities and services for various persons and entities. Goldman Sachs and its affiliates and employees, and funds or other entities they manage or in which they invest or have other economic interests or with which they co-invest, may at any time purchase, sell, hold or vote long or short positions and investments in securities, derivatives, loans, commodities, currencies, credit default swaps and other financial instruments of the Company, Parent, any of their respective affiliates and third parties, including the Moody Revocable Trust, a significant stockholder of the Company, Moody Bank, trustee of the Moody Revocable Trust, or Elliott Management Corporation, an indirect equityholder of Parent (“Elliott Management”) or any of their respective affiliates and, as applicable, portfolio companies or any currency or commodity that may be involved in the merger. Goldman Sachs acted as financial advisor to the Company in connection with, and participated in certain of the negotiations leading to, the merger. During the two-year period ended October 8, 2023, Goldman Sachs Investment Banking has not been engaged by the Company or its affiliates to provide financial advisory or underwriting services for which Goldman Sachs has recognized compensation. During the two-year period ended October 8, 2023, Goldman Sachs Investment Banking has not been engaged by Parent or its affiliates to provide financial advisory or underwriting services for which Goldman Sachs has recognized compensation. During the two-year period ended October 8, 2023, Goldman Sachs Investment Banking has not been engaged by the Moody Revocable Trust or its affiliates to provide financial advisory or underwriting services for which Goldman Sachs has recognized compensation. During the two-year period ended October 8, 2023, Goldman Sachs Investment Banking has not been engaged by the Moody Bank or its affiliates to provide financial advisory or underwriting services for which Goldman Sachs has recognized compensation. Goldman Sachs has provided certain financial advisory and/or underwriting services to Elliott Management and/or its affiliates and portfolio companies from time to time for which Goldman Sachs Investment Banking has received, and may receive, compensation, including having acted as financial advisor to Athenahealth Inc., a portfolio company of Elliott Management, in connection with its sale in November 2021; having acted as financial advisor to Quest Software Inc., a portfolio company of Elliott Management, in connection with its sale in November 2021; having acted as financial advisor to a consortium including Elliott Management in connection with its acquisition of Syneos Health in May 2023; having acted as bookrunner in connection with a secured note offering by Nielsen Holdings plc in connection with its acquisition by Elliott Management in November 2022; having acted as bookrunner in connection with a term loan facility for Windstream Holdings Inc., a portfolio company of Elliott Management, in November 2022; and having acted as bookrunner for Peabody Energy Corporation, a portfolio company of Elliott Management, with respect to its unsecured revolving credit facility in March 2022. During the two-year period ended October 8, 2023, Goldman Sachs has recognized compensation for financial advisory and/or underwriting services provided by Goldman Sachs Investment Banking to Elliott Management and/or its affiliates of approximately $200 million. Goldman Sachs may also in the future provide financial advisory and/or underwriting services to the Company, Parent, the Moody Revocable Trust, Moody Bank, Elliott Management and their respective affiliates and, as applicable, portfolio companies, for

which Goldman Sachs Investment Banking may receive compensation. Affiliates of Goldman Sachs & Co. LLC also may have co-invested with Elliott Management and its affiliates from time to time and may have invested in limited partnership units of affiliates of Elliott Management from time to time and may do so in the future.

The Company’s board of directors selected Goldman Sachs as its financial advisor because it is an internationally recognized investment banking firm that has substantial experience in transactions similar to the merger. Pursuant to a letter agreement dated January 4, 2023, the Company engaged Goldman Sachs to act as its financial advisor in connection with the strategic review process that resulted in the execution of the merger agreement. The engagement letter between the Company and Goldman Sachs provides for a transaction fee that is estimated, based on the information available as of the date of announcement, at approximately $26.2 million (not including up to $2 million of additional fees that may be payable to Goldman Sachs at the Company’s discretion), $2 million of which became payable upon presentation of the final results of the study Goldman Sachs undertook to determine whether it was able to render a fairness opinion in connection with the merger agreement and the remainder of which is contingent upon consummation of the merger. In addition, the Company has agreed to reimburse Goldman Sachs for certain of its expenses, including attorneys’ fees and disbursements, and to indemnify Goldman Sachs and related persons against various liabilities, including certain liabilities under the federal securities laws.

Certain Prospective Unaudited Financial and Operating Information of National Western

National Western does not, as a matter of general practice, publicly disclose detailed internal projections of its future financial performance due to, among other reasons, the uncertainty, unpredictability and subjectivity of the underlying assumptions and estimates involved in generating such projections. However, National Western’s management, as part of the Company’s ordinary course strategic and business planning efforts, customarily prepares forecasts and projections for internal use on a statutory basis (i.e., instead of generally accepted accounting principles (“GAAP”)). None of the Company’s statutory basis projections were shared with any potential counterparty. In connection with the strategic review process, National Western’s management prepared the Forecasts by converting the Company’s most recent National Western Life projections from statutory principles to GAAP, using statutory vs GAAP accounting differences previously identified as part of the Company’s annual audit reporting process. These differences include amortization expense for deferred acquisition costs (“DAC”), deferred sales inducements “DSI” amortization expense and cost of reinsurance (“COR”), as well as market risk benefit (“MRB”) expense, reinsurance gain amortization and GAAP expense capitalization for DAC.

The Forecasts were reviewed and approved by the Transaction Committee for use in connection with the strategic review process.

The Forecasts were not prepared with a view to public disclosure and are included in this proxy statement only because such information was (i) made available to Parent and certain of its representatives in connection with Parent’s due diligence review of National Western and (ii) provided to the National Western board of directors in connection with its evaluation of the merger agreement and the transactions contemplated by the merger agreement, including the merger. The Forecasts also were provided to the Company’s financial advisor, Goldman Sachs, for its use and reliance in connection with its financial analyses and opinion as described in the section titled “— Opinion of National Western’s Financial Advisor” above, beginning on page 47.

Although adjusted for certain differences between GAAP and statutory principles, the Forecasts were not prepared with a view to compliance with GAAP, as applied in the United States. In addition, the Forecasts were not prepared with a view to compliance with the published guidelines of the SEC regarding projections and forward-looking statements or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information. Neither National Western’s independent registered public accounting firm, nor any other independent accounting firm, has audited, reviewed, compiled, examined or performed any procedures with respect to the Forecasts included below, nor has any such firm expressed any opinion or any other form of assurance on such information, and no such firm assumes any responsibility for, and expresses no opinion on, the Forecasts.

The Forecasts contain certain non-GAAP financial measures that Company management believes are helpful in understanding the Company’s past financial performance and estimated future results. Company management regularly uses a variety of financial measures that are not in accordance with GAAP for forecasting, budgeting and measuring financial performance. The non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures. While Company management believes these non-GAAP financial measures provide meaningful information to help investors understand the operating results and to analyze the Company’s financial and business trends on a period-to-period basis, there are limitations associated with the use of these non-GAAP financial

measures. These non-GAAP financial measures are not prepared in accordance with GAAP, are not reported by all of the Company’s competitors and may not be directly comparable to similarly titled measures of the Company’s competitors due to potential differences in the exact method of calculation. The SEC rules that would otherwise require a reconciliation of a non-GAAP financial measure to a GAAP financial measure do not apply to non-GAAP financial measures provided to a board of directors or a financial advisor in connection with a proposed business combination.

A summary of the adjusted operating income of the Company and its consolidated subsidiaries, based on the Forecasts, is set forth below (amounts reflect rounding):

____________

(1)      The sum of the numerical data in any column in this table may not equal the indicated total or subtotal due to rounding.

(2)      Balances and income statement line items subject to market value changes (equity securities, debt securities reported at fair value, index options, embedded derivative instruments, etc.) were frozen at their March 31, 2023 amounts. The projections do not include any variability due to fair value changes.

(3)      Realized gains (losses) on investments for 2023 includes the Company’s gain realized on tendering to Moody Bancshares all of the common shares owned by the Company to Moody Bancshares pursuant to its self-tender offer in August 2023.

(4)      Federal income tax expense was calculated at 20% of pretax earnings consistent with the Company’s historical effective tax rate.

The Forecasts prepared by National Western’s management and included in this proxy statement are subjective in many respects and do not take into account any circumstances or events occurring after the date they were prepared. The Forecasts are not fact and should not be relied upon as necessarily indicative of actual future results; readers of this proxy statement are cautioned not to place undue reliance on this information. The inclusion of the Forecasts in this proxy statement should not be deemed an admission or representation by National Western, Parent, their respective affiliates, advisors or other representatives or any other person that the Forecasts are viewed as material information of National Western, particularly in light of the inherent risks and uncertainties associated with such forecasts. Although this summary of the Forecasts is presented with numerical specificity, the projections reflect numerous variables, assumptions and estimates as to future events made by the Company’s management that our management believed were reasonable at the time the Forecasts were prepared, taking into account the relevant information available to National Western’s management at the time. However, those variables, assumptions and estimates are inherently uncertain and many of those variables, assumptions and estimates are beyond the control of National Western’s management. Given that the Forecasts cover multiple years, by their nature, they become subject to greater uncertainty with each successive year. The Forecasts reflect numerous estimates and assumptions with respect to industry performance, general business, economic, regulatory, market and financial conditions, and other future events, as well as matters specific to National Western’s business, all of which are difficult to predict and many of which are beyond National

Western’s control. As a result, there can be no assurance that the projected results will be realized or that actual results will not be significantly higher or lower than projected. The Forecasts are subjective in many respects and thus are susceptible to multiple interpretations. As such, the Forecasts constitute forward-looking information and are subject to risks and uncertainties, including the various risks set forth in National Western’s Annual Report on Form 10-K for the year ended December 31, 2022 and any subsequent Quarterly Reports on Form 10-Q and the other reports filed by National Western with the SEC. For information on factors that may cause National Western’s future results to materially vary, see the section titled “Special Note Regarding Forward-Looking Statements” beginning page 17.

There can be no assurance that the Forecasts will be realized and actual results may be materially better or worse than those contained in the Forecasts. The inclusion of this information should not be regarded as an indication that the National Western board of directors, National Western, Parent, Merger Sub, their respective affiliates, advisors or other representatives or any other recipient of this information considered, or now considers, the Forecasts to be necessarily predictive of actual future results, nor should it be construed as financial guidance, and it should not be relied upon as such. Furthermore, the Forecasts are not included in this proxy statement to influence any decision whether to vote in favor of the proposal to adopt the merger agreement or take any other action, but rather are included in this proxy statement to provide Company stockholders with access to certain non-public information that was provided to the Company Board and potential counterparties for purposes of considering and evaluating the merger.

Except to the extent required by applicable federal securities laws, we do not intend, and expressly disclaim any responsibility, to update or otherwise revise the Forecasts to reflect (i) circumstances existing after the date when the Forecasts were prepared or (ii) the occurrence of future events or changes in general economic or industry conditions, even in the event that any of the assumptions underlying the Forecasts is shown to be inappropriate. By including in this proxy statement a summary of certain Forecasts, none of National Western, Parent, Merger Sub or their respective affiliates, advisors or other representatives makes any representation to any person regarding the ultimate performance of National Western or the surviving corporation compared to the information contained in such financial forecasts and should not be read to require such persons to do so.

Interests of National Western Directors and Executive Officers in the Merger

National Western’s directors and executive officers have interests in the merger that may be different from, or in addition to, the interests of National Western stockholders generally. You should keep this in mind when considering the recommendation of the National Western board of directors “FOR” the adoption of the merger agreement. The members of the National Western board of directors were aware of these interests and considered them at the time they approved the merger agreement and in recommending that National Western stockholders adopt the merger agreement. These interests are described below.

Certain Assumptions

Except as otherwise specifically noted, for purposes of quantifying the potential payments and benefits described in this section, the following assumptions, as well as those described in the footnotes to the table in the section titled “— Merger-Related Compensation” below, were used:

•        the merger consideration is $500.00 per share, which is the fixed price per share to be received by National Western stockholders in respect of their shares of Company common stock in connection with the merger;

•        for any Company PSUs subject to performance-based vesting conditions, the performance goals are deemed to be achieved at the target level of performance in accordance with the terms of the merger agreement;

•        the assumed effective time is April 1, 2024, which is the assumed date of the effective time solely for purposes of the disclosure in this section (the “assumed effective time”);

•        no director or executive officer receives any additional equity grants or other awards on or prior to the assumed effective time;

•        the employment of each of National Western’s executive officers is terminated immediately following the assumed effective time; and

•        the service of each non-employee director of National Western is terminated immediately following the assumed effective time.

Treatment of Outstanding Equity-Based Awards

Pursuant to the terms of the merger agreement, upon the effective time, each Company PSU, each Company RSU and each Company SAR Award, whether vested or unvested that is outstanding immediately prior to the effective time, will be canceled in exchange for the right to receive the amount of cash consideration described below:

•        At the effective time, each Company PSU will be canceled in exchange for solely a cash payment, without interest, equal to the product of (i) the total number of shares of Company common stock subject to such award immediately prior to the effective time (based on target performance) multiplied by (ii) the $500 per share merger consideration.

•        At the effective time, each Company RSU will be canceled in exchange for solely a cash payment, without interest, equal to the product of (i) the total number of shares of Company common stock subject to such award immediately prior to the effective time multiplied by (ii) the $500 per share merger consideration.

•        At the effective time, each Company SAR Award would be canceled in exchange for solely a cash payment, without interest, equal to the product of (i) the total number of shares of Company common stock subject to such award immediately prior to the effective time multiplied by (ii) the excess, if any, of the $500 per share merger consideration over the exercise price per share. However, if the exercise price per share for a Company SAR Award is equal to or greater than the $500 per share merger consideration, then that Company SAR Award will be cancelled in exchange for no consideration.

Treatment of Outstanding Equity-Based Awards — Summary Tables

Non-Employee Directors

The following table sets forth the cash proceeds that each of National Western’s non-employee directors would be expected to receive in respect of outstanding equity-based awards held by that director as of the assumed effective time in accordance with the treatment of outstanding equity-based awards described above. Depending on when the effective time occurs, certain of these equity-based awards may vest, be exercised and/or cancelled, in each case, prior to the actual effective time in accordance with their terms and independent of the occurrence of the merger. Generally, non-employee directors are granted Company RSUs, which are settled only for cash upon vesting. In addition, Charles Milos, a non-employee director and former employee of the Company, holds Company SAR Awards, which were previously granted to Mr. Milos when he served as an employee of the Company. Pursuant to their terms, these Company SAR Awards are vested and can be settled only for cash. As a result, no shares of Company common stock are issuable upon exercise of these Company SAR Awards.

Non-Employee Director Equity Summary Table

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(1)      As of the assumed effective time, each outstanding Company RSU will be converted into solely the right to receive a payment in cash, without interest, equal to the merger consideration of $500.00 per share multiplied by the number of shares subject to each such award.

(2)      As of the assumed effective time, each outstanding Company SAR Award (regardless of whether vested — noting that no such Company SAR Award held by National Western’s non-employee directors that is outstanding as of such time will be unvested) will be converted into solely the right to receive a payment in cash, without interest, equal to the product of (i) the

total number of shares of Company common stock subject to such award immediately prior to the assumed effective time multiplied by (ii) an amount equal to (x) the merger consideration of $500.00 per share minus (y) the exercise price of such Company SAR Award.

(3)      As of the assumed effective time, with the exception of Charles Milos, none of National Western’s non-employee directors held any outstanding equity-based awards other than the time-based Company RSUs set forth above. Mr. Milos previously served as an employee of the Company and received additional equity-based awards in that capacity, which have previously vested and include Company SAR Awards, which remain outstanding as of the date of this proxy statement and are assumed to be outstanding as of the assumed effective time.

Executive Officers

The following table sets forth the cash proceeds that each of National Western’s executive officers would be expected to receive in respect of outstanding equity-based awards held by that officer as of the assumed effective time in accordance with the treatment of outstanding equity-based awards described above. Depending on when the effective time occurs, certain of these equity-based awards may vest, be exercised and/or cancelled, in each case, prior to the actual effective time in accordance with their respective terms, independent of the occurrence of the merger. All Company RSUs granted to executive officers are, by their terms, settled solely for cash upon vesting, and all Company PSUs granted to executive officers are, by their terms, settled solely for cash as soon as practicable after vesting, subject to the preparation of the Company’s annual consolidated financial statements to determine what level of performance has been achieved for the applicable three-year performance period. Vested Company RSUs are typically settled in cash in December upon completion of a three-year vesting period, and vested Company PSUs are typically settled for cash in March or April after the end of the applicable three-year performance period. Therefore, with the exception of the vested Company SAR Awards included in the table below, no executive officer will hold any vested equity-based awards, including vested Company RSUs or vested Company PSUs as of the assumed effective time. Under the terms of the Company SAR Awards, no shares of Company common stock will be issued upon exercise of any Company SAR Awards. The Company SAR Awards can be settled only for cash.

Executive Officer Vested Equity-Based Awards Summary Table

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(1)      As of the assumed effective time, each vested and outstanding Company SAR Award held by any of National Western’s executive officers will be converted into solely the right to receive a payment in cash, without interest, equal to the product of (i) the total number of shares of Company common stock subject to such award immediately prior to the assumed effective time multiplied by (ii) an amount equal to (x) the merger consideration of $500.00 minus (y) the exercise price of such Company SAR Award.

The following table sets forth the cash proceeds that each of National Western’s executive officers would receive in respect of unvested Company RSUs, unvested Company PSUs and unvested Company SAR Awards held by that executive officer as of the assumed effective time in accordance with the treatment of outstanding equity-based awards described above.

Executive Officer Unvested Equity-Based Awards Summary Table

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(1)      As of the assumed effective time, the vesting of each outstanding and unvested Company SAR Award held by any of National Western’s executive officers will be accelerated, and each such Company SAR Award will be converted into solely the right to receive a payment in cash, without interest, equal to the product of (i) the total number of shares of Company common stock subject to such award immediately prior to the assumed effective time multiplied by (ii) an amount equal to (x) the merger consideration of $500.00 per share minus (y) the exercise price of such Company SAR Award.

(2)      As of the assumed effective time, the vesting of each outstanding and unvested Company RSU will be accelerated, and each such Company RSU will be converted into solely the right to receive a payment in cash, without interest, equal to the product of (i) the total number of shares of Company common stock subject to such award immediately prior to the assumed effective time multiplied by (ii) the merger consideration of $500.00 per share.

(3)      As of the assumed effective time, the vesting of each outstanding and unvested Company PSU held by any of National Western’s executive officers will be accelerated, and each such Company PSU will be converted into solely the right to receive a payment in cash, without interest, equal to the product of (i) the total number of target shares of Company common stock subject to such award (i.e., the number of such shares that would vest if performance conditions under such award were achieved at target) immediately prior to the assumed effective time multiplied by (ii) the merger consideration of $500.00 per share.

Severance Benefits in Change in Control and Employment Agreements with Executive Officers

Executive Officers Generally.    The following discussion relates to the change in control agreements between the Company and each of National Western’s executive officers other than David R. Melton and Patrick Johnson (collectively, the “Standard Officers”).

National Western generally does not utilize employment agreements with respect to its executive officers (however, David R. Melton is party to an employment agreement, as further discussed below). Instead, National Western’s general practice has been to issue offer letters to executive officer candidates when recruited to their positions. In addition to outlining the Standard Officer’s responsibilities, each offer letter specifies the beginning base salary and eligibility for any additional compensation programs overseen by the Compensation Committee of the National Western board of directors (the “Compensation Committee”). Except for the change in control agreements with the Standard Officers described below, as of the date hereof, National Western does not have any contractual obligations with respect to the Standard Officers for severance payments in connection with any termination or change in control.

In December 2021, National Western entered into a Change in Control & Severance Agreement with Ross Moody, with a two-year term. As permitted by the merger agreement, and as approved by the Compensation Committee, this agreement was renewed for an additional two years, with the term now scheduled to expire on December 16, 2025. However, following any change in control, in accordance with the terms of the agreement, the term will be extended

until the third anniversary of such change in control. The agreement also terminates upon Ross Moody’s earlier death or incapacity. Pursuant to this agreement, Ross Moody is eligible to receive certain severance benefits if there is a qualifying termination of employment within three years following a change in control or following certain other terminations outside of that three-year vesting period, as described below.

In 2019, National Western entered into Change in Control Agreements with the Standard Officers other than Ross Moody. In 2019, National Western also entered into a Change in Control Agreement with Patrick Johnson, who serves as Vice President, Human Resources. The Company’s form of Change in Control Agreement for vice presidents like Mr. Johnson is substantially similar to the form used for the Standard Officers, except as described below.

The term of each such Change in Control Agreement ends on the second anniversary of a “change in control,” as defined in the agreements in the case of the Standard Officers (and, in the case of Patrick Johnson’s agreement, the first anniversary), unless the agreement is earlier terminated pursuant to its terms. Under these agreements, each Standard Officer other than Ross Moody is eligible to receive certain severance benefits if there is a qualifying termination of employment within two years following a change in control (and, in the case of Patrick Johnson’s agreement, within one year following a change in control). Such agreements do not provide for any payments or benefits in connection with a termination of employment in the absence of a change in control.

Ross Moody’s Change in Control & Severance Agreement provides for severance payments upon National Western’s involuntary termination of Ross Moody’s employment for any reason other than for “cause,” death or incapacity, or by Ross Moody’s voluntary termination of employment for certain reasons specified in such agreement, within three years following a “change in control.” In the event of such a qualifying termination following a change in control, Ross Moody would be entitled to:

•        A lump sum cash payment in an amount equal to two times the sum of (i) Ross Moody’s annual base salary plus (ii) his target annual bonus;

•        Reimbursement of up to $50,000 for expenses and costs related to outplacement services;

•        Continued use of a company car by him for one year following the termination date; and

•        Reimbursement up to $75,000 for legal fees and expenses incurred as a result of any dispute resolution process entered into by him to enforce the Change in Control & Severance Agreement.

In addition, under Ross Moody’s Change in Control & Severance Agreement, if Ross Moody’s employment is involuntarily terminated by National Western for any reason other than for “cause,” death, or incapacity during the employment period (but not within three years after a “change in control,” as defined in the agreement), subject to his execution of a release of claims, he will be entitled to:

•        A lump sum cash payment in an amount equal to his currently effective annual base salary through the termination date plus any accrued vacation pay;

•        A lump sum cash amount equal to two times the sum of his annual base salary and his target bonus;

•        Continued vesting of certain incentive awards for three years from the termination date (as applicable); and

•        Financial counseling services, not to exceed $35,000, for a one-year period after such termination.

The Change in Control Agreements with each of the Standard Officers other than Ross Moody provide for severance payments upon National Western’s involuntary termination of such Standard Officer’s employment for any reason other than for “cause,” death or incapacity, or by such Standard Officer’s voluntary termination of employment for certain reasons specified in such agreement, within two years following a “change in control” (or, in the case of Patrick Johnson’s agreement, one year). In the event of such a qualifying termination following a change in control, the terminated Standard Officer would be entitled to:

•        A lump sum cash payment in an amount equal to the sum of (i) the Standard Officer’s annual base salary plus (ii) his or her target annual bonus (or, in the case of Patrick Johnson’s agreement, 50% of such sum).

Under Change in Control & Severance Agreement with Ross Moody and the Change in Control Agreements with the other Standard Officers (collectively, the “CIC Agreements”), if a Standard Officer (including Ross Moody) voluntarily terminates his or her employment after one or more of the following events following a change in control, such termination is treated as a qualifying termination for purposes of the benefits payable under the agreements (“Permitted Resignation”):

•        The Standard Officer’s annual base salary, target bonus or any of his or her other material compensation arrangements is materially reduced, unrelated to his or her performance;

•        The Standard Officer’s duties or responsibilities are negatively and materially changed in a manner inconsistent with his or her position or authority;

•        National Western requires the Standard Officer’s work location or residence to be relocated more than 25 miles from its location as of the change in control; or

•        National Western or its successor fails to offer the Standard Officer a comparable position after the change in control.

Under the CIC Agreements, “cause” is generally defined as the failure (which in the case of Mr. Moody must be willful and continued) of the executive to perform substantially the executive’s duties owed to National Western or its affiliates after demand for performance is delivered to the executive identifying the nature of such unacceptable performance.

Under the CIC Agreements, a “change in control” is deemed to occur if:

•        Any person or group of persons (within the meaning of Section 13(d) of the Exchange Act), other than National Western, its subsidiaries or any of their employee benefit plans, acquires beneficial ownership (as defined in such Section 13(d)) (directly or indirectly) of (i) 50% or more of National Western’s outstanding securities entitled to vote in the elections of directors (or securities or rights convertible into or exchangeable for such securities) (“Voting Stock”), or (ii) Voting Stock having a total number of votes that may be cast and elect a majority of National Western’s directors; or

•        There has been a change in a majority of the members of the National Western board of directors within a 12-month period, unless the election or nomination for election by National Western’s stockholders of each new director during such 12-month period was approved by the vote of two-thirds of the directors then in office and who were directors at the beginning of such 12-month period; or

•        There has been an approval by National Western’s stockholders of (i) any consolidation, merger, or other reorganization in which National Western is not the continuing or surviving corporation or pursuant to which shares of Voting Stock would be converted into cash, securities, or other property, other than a merger of National Western in which holders of Voting Stock immediately prior to the merger have either the same proportionate ownership of common stock of the surviving corporation immediately after the merger as immediately before or have more than 50% of the ownership of voting common stock of the surviving corporation immediately after the merger, or (ii) any sale, lease, exchange, or other transfer in one transaction or a series of related transactions of 50% or more of National Western’s assets; or

•        There has been a liquidation or dissolution of National Western.

The approval of the merger by National Western’s stockholders, and the merger itself (if consummated), will qualify as a change in control for purposes of each of the CIC Agreements.

The CIC Agreements include restrictive covenants related to the protection of confidential information, and as further discussed below, certain time limits on any noncompetition covenants that may apply to Standard Officers after their qualifying termination (i.e., that entitles a Standard Officer to the foregoing severance benefits). Pursuant to each CIC Agreement, if a Standard Officer incurs a qualifying termination of employment during the first year following a change in control, then such Standard Officer will cease to be subject to the terms of any noncompetition agreement he or she previously entered into with National Western. If a Standard Officer incurs a qualifying termination of employment during the second year following a change in control, then the Standard Officer will remain subject to the terms of any noncompetition agreement he or she previously entered into with National Western for one year

thereafter. In the case of Ross Moody, if he incurs a qualifying termination of employment during the third year following a change in control, then he will remain subject to the terms of any noncompetition agreement he previously entered into with National Western for two years thereafter.

If the payments to a Standard Officer under a CIC Agreement (after taking into consideration all other amounts payable to the officer under other National Western plans, programs, policies, and arrangements) would cause the Standard Officer to be subject to an excise tax under Section 4999 of the Internal Revenue Code of 1986, as amended (the “Code”), then National Western will reduce the payments to the largest amount that could be payable without causing any payment to be subject to the excise tax, but only if that reduction would result in a better after-tax result for the Standard Officer.

David R. Melton.    The following discussion relates to the employment agreement that applies to David R. Melton. As indicated above, Mr. Melton is subject to an employment agreement in connection with his services for Ozark National Life. Under his employment agreement, Mr. Melton will become entitled, subject to his continuing compliance with certain restrictive covenants and his execution of a release of claims, to the following termination payments and benefits upon (a) Ozark’s involuntary termination of his employment without “cause” or (b) his voluntary termination of employment for “good reason” (each as defined in his employment agreement).

•        A lump sum cash payment in an amount equal to any then-unpaid bonuses for any full fiscal year preceding the year in which such termination occurs;

•        A lump sum cash payment of the pro-rata annual bonus for the year in which such termination occurs equal to the product of (i) the annual bonus Mr. Melton would have otherwise earned for such year (such amount is payable at the time annual bonus payments are payable to executives generally) multiplied by (ii) a fraction, the numerator of which is the number of days elapsed from the beginning of such year to the termination date, and the denominator of which is 365;

•        An amount equal to one-twelfth of Mr. Melton’s annual base salary as of the date of such termination (without giving effect to any reduction that would constitute “good reason” as defined below) (the “Monthly Base Salary Benefit Amount”), payable on a monthly basis for a period equal to six months; and

•        An amount equal to the applicable premium otherwise payable for COBRA continuation coverage for Mr. Melton (and, to the extent covered immediately prior to the termination date, his spouse and dependents) that will be payable on a monthly basis for a period equal to 12 months.

Under Mr. Melton’s employment agreement, there is no additional severance benefit payable in the event his qualifying termination occurs after a change in control. However, Ozark National Life may elect to extend the period during which Mr. Melton is subject to post-termination noncompetition and nonsolicitation covenants for up to an additional 12 months beyond the 12-month post-employment period during which such covenants are applicable by making additional payments of the Monthly Base Salary Benefit Amount for the number of months during which such restrictive covenants are so extended.

Under Mr. Melton’s employment agreement, “cause” generally means the occurrence of any one of the following:

•        Mr. Melton’s conviction, or plea of guilty or no contest, to or for any felony or crime of moral turpitude that may materially affect the business, standing or reputation of Ozark National Life or any employee thereof;

•        Mr. Melton’s fraud, embezzlement other misappropriation of funds;

•        Mr. Melton’s willful or material breach of the employment agreement if not cured within 30 days following receipt from Ozark National Life of written notice thereof (the “Melton Cure Condition”); or

•        Mr. Melton’s willful refusal to perform his lawful and reasonable duties to Ozark National Life, subject to the Melton Cure Condition.

Under Mr. Melton’s employment agreement, “good reason” generally means the occurrence of any one of the following:

•        Mr. Melton experiences a material adverse change in his title, authority or duties;

•        Mr. Melton’s base salary or target annual bonus opportunity is reduced;

•        Ozark National Life’s material breach of Mr. Melton’s employment agreement;

•        A relocation of Mr. Melton without reimbursement for his normal, reasonable and customary relocation expenses; or

•        The failure of Ozark National Life to procure, or deliver satisfactory evidence of, the assumption of Mr. Melton’s employment agreement by any successor company.

However, none of the foregoing events or conditions will constitute good reason unless (a) Mr. Melton provides Ozark National Life with written objection to the event or condition within 90 days following the occurrence thereof, (b) Ozark National Life does not reverse or otherwise cure the event or conditions within 15 days of receiving such written objection (the “Employer Cure Period”), and (c) Mr. Melton resigns his employment within 30 days following the expiration of the Employer Cure Period.

Standard Officers, Patrick Johnson and David R. Melton.    For illustrative purposes only, based on the assumptions described above under “— Certain Assumptions,” it is currently estimated that National Western’s current executive officers would be entitled to receive, in the aggregate, approximately $9.9 million in cash severance benefits under the CIC Agreements and Mr. Melton’s employment agreement (excluding payment of accrued and unused vacation). See the section titled “— Merger-Related Compensation” below for an estimate of the amounts that would become payable to each of National Western’s named executive officers under the CIC Agreements.

Compensation Arrangements with Parent

As of the date of this proxy statement, there are no new employment, equity or other arrangements or understandings between any National Western executive officer or non-employee director, on the one hand, and Parent, on the other hand. The merger is not conditioned upon any executive officer or non-employee director of National Western entering into any such arrangement or understanding. Prior to the effective time, Parent may, in its discretion, initiate discussions or negotiations about such arrangements and understandings with certain of National Western’s executive officers and may enter into definitive agreements with certain of National Western’s executive officers regarding continued service, in each case, taking effect at or after the effective time of the merger. No such discussions or negotiations have occurred or are expected to occur, and no such arrangements or understandings are expected to be implemented, with respect to National Western’s non-employee directors.

Benefits Arrangements with Parent

As further described in the section titled “The Merger Agreement — Employee Matters,” for a period of one year following the effective time, the merger agreement requires Parent to maintain no less favorable compensation and comparable employee benefits for National Western’s employees (including National Western’s executive officers) as provided by National Western immediately prior to the effective time.

Indemnification and Insurance

The merger agreement provides for certain indemnification arrangements for National Western’s current executive officers and directors and the continuation of certain insurance arrangements for National Western’s current executive officers and directors for six years after the effective time.

Merger-Related Compensation

The information set forth in the table below is intended to comply with Item 402(t) of Regulation S-K, which requires disclosure of compensation that each named executive officer could receive that is based on or otherwise relates to the merger. This compensation is referred to as “golden parachute” compensation by the applicable SEC disclosure rules, and in this section we use that term to describe the merger-related compensation payable to National Western’s named executive officers. For additional details regarding the terms of the payments and benefits described below, see the discussion above. This merger-related compensation is subject to a non-binding advisory vote of National Western stockholders, as set forth in proposal two to this proxy statement. See the section titled “National Western Proposal — Advisory (Non-Binding) Vote on Compensation” beginning on page 86.

The amounts set forth below are estimates of amounts that would be payable to the named executive officers using the assumptions described above under “— Certain Assumptions.” These estimates are based on multiple assumptions that may or may not actually occur, including assumptions described in this proxy statement. Some of the assumptions are based on information not currently available, and as a result the actual amounts, if any, to be received by a named executive officer may differ in material respects from the amounts set forth below.

All dollar amounts set forth below have been rounded to the nearest whole number.

Golden Parachute Compensation(1)

____________

(1)      The amounts reported in the “Equity” column are attributable to the accelerated vesting, cancellation and cash-out of outstanding equity-based awards pursuant to the merger agreement (sometimes referred to as a “single-trigger” arrangement).

(2)      Amounts reflect “double-trigger” cash severance benefits under the CIC Agreements, meaning that payment of such amounts requires the consummation of the merger, as well as a qualifying termination of employment. In particular, such amounts would be payable in a lump sum, assuming a termination of employment by National Western without cause or by the named executive officer due to his or her Permitted Resignation following the merger, as follows: (i) in the case of Ross Moody, (x) 200% of his base salary ($1,155,649); and (y) 200% of his target annual bonus ($1,271,214); and (ii) in the case of each National Western’s named executive officer other than Ross Moody (x) 100% of his base salary (Rey Perez, $500,000; Brian Pribyl, $442,000; Chad Tope, $444,338; and Greg Owen, $315,342); and (y) 100% of his target annual bonus (Rey Perez, $500,000; Brian Pribyl, $221,000; Chad Tope, $444,338; and Greg Owen, $110,370).

(3)      Amounts, which are “single-trigger” reflect the consideration to be received by each named executive officer in connection with the accelerated vesting of, and related cash payment with respect to, unvested and outstanding Company RSUs, Company PSUs and Company SAR Awards and held by each of the named executive officers, which vesting acceleration will occur upon completion of the merger, and the related cash payment will occur on the first regularly scheduled payroll that occurs at least five business days following completion of the merger, as described in more detail in the section above titled “— Treatment of Outstanding Equity-Based Awards.” Pursuant to the terms of the merger agreement, (i) each outstanding Company RSU will be fully vested and converted into a right to receive solely an amount in cash, without interest, equal to the product of (x) the total number of shares of Company common stock subject to such award immediately prior to the effective time multiplied by (y) the merger consideration of $500.00 per share; (ii) each outstanding Company PSU will be fully vested and converted into a right to receive solely an amount in cash, without interest, equal to the product of (x) the total target number of shares of Company common stock (i.e., the number of such shares that would vest if performance conditions under such award were achieved at target) subject to such award immediately prior to the effective time multiplied by (y) the merger consideration of $500.00 per share, and (iii) each outstanding and unvested Company SAR Award will be fully vested and converted into a right to receive solely an amount in cash, without interest, equal to the product of (x) the total number of shares of Company common stock subject to such award immediately prior to the effective time multiplied by (y) an amount equal to (1) the merger consideration of $500.00 per share minus (2) the exercise price of such Company SAR Award.

(4)      As of the assumed effective time, none of National Western’s named executive officers has any unvested account balances or is entitled to receive any enhancements in their benefits under a qualified or non-qualified defined benefit plan or a non-qualified deferred compensation plan sponsored or maintained by National Western.

(5)      Amounts reflect the value of Ross Moody’s benefits under the Change in Control & Severance Agreement that relate to (i) the continued use of a company car for one year following the termination date, which right the Company estimates has value of $23,100, (ii) his right to receive reimbursement of up to $50,000 for expenses and costs related to outplacement services; (iii) his right to receive financial counseling services, not to exceed $35,000, for a one-year period after the termination date and (iv) his right to receive reimbursement amounts up to $75,000 for legal fees and expenses incurred as a result of any dispute resolution process undertaken by Ross Moody to enforce such agreement, as noted above in the section titled “— Change in Control Severance Benefit for Executive Officers.”

(6)      None of the named executive officers is eligible to receive a tax reimbursement based on or otherwise related to the merger. The CIC Agreements provide that the change in control benefits payable to the named executive officers are subject to an automatic reduction to avoid the imposition of excise taxes under Section 4999 of the Code if that reduction would result in a better after-tax result for the named executive officer. The amounts above do not reflect any possible reductions under those provisions.

Compensation of the Transaction Committee

When the Transaction Committee was established by the National Western board of directors on October 21, 2022, the compensation for serving on that committee was deferred to a later date. On December 14, 2022, the National Western board of directors approved a fixed fee of $100,000 for Mr. Pederson, as committee chair, and $70,000 each for Mr. Boone and Dr. Blackwell. Fifty percent of these committee fees was paid on December 20, 2022, and the remaining 50% was paid on October 10, 2023. No portion of these committee fees is or was contingent on the completion of a strategic transaction such as the merger.

Appraisal Rights

Our stockholders have the right under Section 262 of the DGCL to dissent from the merger and to seek appraisal of the fair value of their shares of Company common stock, as determined in accordance with Delaware law. The judicially determined fair value under Section 262 could be greater than, equal to or less than the $500.00 per share that our stockholders are entitled to receive in the merger. To exercise appraisal rights or to preserve the right to do so, stockholders who wish to do so must precisely follow the specific procedures set forth in Section 262 of the DGCL in a timely manner. Failure to strictly comply with these procedures will result in a loss of appraisal rights. These procedures are described in the section titled “Appraisal Rights,” and the provisions of Delaware law that grant appraisal rights and govern such procedures are attached as Annex C.

The Supporting Stockholders are not entitled to appraisal rights because they consented to the merger.

Delisting and Deregistration of Class A Common Stock

If the merger is completed, the shares of Class A common stock will be delisted from the NASDAQ and deregistered under the Exchange Act, and we will no longer file periodic reports with the SEC on account of the Class A common stock. The Class B common stock is held by two stockholders and is not traded on any stock exchange. Therefore, it is not registered under Section 12 of the Exchange Act.

U.S. Federal Income Tax Consequences of the Merger

The following is a general summary of the anticipated U.S. federal income tax consequences to U.S. Holders of the exchange of shares of Company common stock for cash pursuant to the merger. This discussion is based on the Code, final and temporary Treasury Regulations promulgated thereunder, administrative pronouncements or practices and judicial decisions, all as in effect as of the date of this proxy statement. Future legislative, judicial or administrative modifications, revocations or interpretations, which may or may not be retroactive, may result in U.S. federal income tax consequences significantly different from those summarized in this discussion. We have not sought, and do not intend to seek, any ruling from the Internal Revenue Service (the “IRS”) or any other taxing authority with respect to any of the U.S. federal income tax consequences summarized in this discussion. There can be no assurance that the IRS will not challenge any of the consequences summarized below, or that a court will not sustain any such challenge by the IRS.

For purposes of this discussion, the term “U.S. Holder” means a beneficial owner of shares of Company common stock that is, for U.S. federal income tax purposes:

•        an individual who is a citizen or resident of the United States,

•        a corporation (or other entity taxable as a corporation) created or organized under the laws of the United States, any state thereof or the District of Columbia,

•        an estate the income of which is subject to U.S. federal income taxation regardless of its source or

•        a trust that is subject to the primary jurisdiction of a court within the United States and for which one or more U.S. persons have authority to control all substantial decisions, or has a valid election in effect under applicable Treasury Regulations to be treated as a U.S. person.

If a partnership (including any entity or arrangement treated as a partnership for U.S. federal income tax purposes) holds shares of Company common stock, the tax treatment of a partner in that partnership generally will depend on the status of the partner and the activities of the partnership. If you are a partner in a partnership that holds shares of Company common stock, you should consult your own tax advisor regarding the tax consequences of the exchange of shares of Company common stock for cash pursuant to the merger.

This summary is for general information only and does not constitute tax advice. This summary does not address all aspects of U.S. federal income taxation that may be relevant to holders in light of their particular circumstances. In addition, this discussion does not apply to certain categories of holders that are subject to special treatment under the U.S. federal income tax laws, such as (i) banks, financial institutions or insurance companies, (ii) regulated investment companies or real estate investment trusts, (iii) brokers or dealers in securities or currencies or traders in securities that elect mark-to-market treatment, (iv) tax-exempt organizations, qualified retirement plans, individual retirement accounts or other tax-deferred accounts, (v) holders that validly exercise appraisal rights in connection with the merger, (vi) holders that acquired shares of Company common stock as compensation for services, (vii) holders that own shares of Company common stock as part of a straddle, hedge, constructive sale, conversion transaction or other integrated investment, (viii) holders that are liable for the “alternative minimum tax” under the Code, (ix) U.S. Holders whose functional currency is not the United States dollar, or (x) holders who are not U.S. Holders. This discussion does not address any tax consequences arising under any state, local or non-U.S. tax laws, U.S. federal estate or gift tax laws, or the 3.8% Medicare tax on certain net investment income. In addition, this discussion applies only to holders that hold their shares of Company common stock as capital assets (generally, property held for investment).

STOCKHOLDERS OF THE COMPANY ARE URGED TO CONSULT THEIR OWN TAX ADVISORS REGARDING THE APPLICATION OF U.S. FEDERAL TAX LAWS TO THEM IN LIGHT OF THEIR OWN PARTICULAR CIRCUMSTANCES AND ANY TAX CONSEQUENCES ARISING UNDER THE LAWS OF ANY STATE, LOCAL, NON-U.S. OR OTHER TAXING JURISDICTION.

The Merger Will Be a Taxable Event

The exchange of shares of Company common stock for cash pursuant to the merger will be a taxable transaction for U.S. federal income tax purposes. In general, a U.S. Holder will recognize gain or loss equal to the difference between (i) the amount of cash received and (ii) such U.S. Holder’s adjusted tax basis in its shares of Company common stock. Generally, the gain or loss will be capital gain or loss and will be long-term capital gain or loss if the shares of Company common stock exchanged were held for more than one year as of the date of the exchange (i.e., in this case, the effective time of the merger). Long-term capital gains of non-corporate U.S. Holders generally are subject to U.S. federal income tax at preferential rates. The deduction of capital losses is subject to limitations. Gain or loss must be calculated separately for each block of shares of Company common stock (i.e., shares of Company common stock acquired for the same cost in the same transaction) exchanged for cash pursuant to the merger.

Information Reporting and Backup Withholding

Information reporting requirements generally will apply to the exchange of shares of Company common stock for cash pursuant to the merger. Certain non-corporate stockholders may be subject to backup withholding at a rate of 24% on cash payments received in exchange for Company common stock in the merger. To prevent backup withholding, a Company stockholder must either provide a correct taxpayer identification number and certify that the stockholder is not subject to backup withholding under the Code by properly completing Form W-9 or establish a basis for exemption from backup withholding.

Company stockholders who fail to provide their correct taxpayer identification numbers and the appropriate certifications or to establish an exemption as described above will be subject to backup withholding on cash amounts received in connection with the merger and may be subject to penalties imposed by the IRS. Amounts withheld pursuant to backup withholding are not an additional tax and may be refunded or credited against a Company stockholder’s federal income tax liability, but only if that stockholder furnishes the information outlined above to the IRS and other applicable requirements are satisfied.

Regulatory Approvals

The closing of the merger is subject to the completion of certain governmental and regulatory clearance procedures, including the receipt of approvals or non-disapprovals from certain U.S. state insurance regulators and FINRA in connection with the merger and other transactions contemplated by the merger agreement, and early termination or expiration of the waiting period under the HSR Act. Under the merger agreement, Parent, Merger Sub and the Company are also obligated to use reasonable best efforts to seek and obtain certain other approvals and non-disapprovals from governmental entities, and to make certain other filings and provide certain notices, which approvals, non-disapprovals, filings, and notices are not conditions to the closing of the merger agreement or prerequisites for the closing of the merger under applicable law and regulation.

While we believe that Parent and the Company will receive the approvals and non-disapprovals discussed below that are prerequisites to the consummation of the merger under the merger agreement and applicable law and regulation, Parent and the Company may not obtain all such approvals.

Insurance Laws and Regulations

Parent is an insurance company domiciled in Arizona. National Western Life, the Company’s wholly-owned insurance company subsidiary, is currently domiciled in Colorado. Ozark National Life, a wholly-owned insurance company subsidiary of National Western Life, is domiciled in Missouri. Under the terms of the merger agreement, Parent’s and Merger Sub’s obligations to consummate the merger are subject to the approval of the redomestication of National Western Life from Colorado to Arizona. On November 6, 2023, Parent and National Western Life submitted redomestication applications to the Arizona and Colorado state insurance regulators, seeking approval of the redomestication of National Western Life to Arizona.

The insurance laws and regulations of the U.S. states of Arizona, Colorado and Missouri generally require that, prior to the acquisition of control of an insurance company domiciled in those jurisdictions, the acquiring person obtain the approval of a Form A statement by the insurance regulator of each such jurisdiction for such acquisition of control. Accordingly, on November 6, 2023, the Parent Control Persons made the requisite Form A filing with the state insurance regulators in Arizona, seeking approval to acquire control of National Western Life. Because National Western Life’s redomestication to Arizona is a closing condition, no change of control of National Western Life will occur unless and until it is domiciled in Arizona. On November 6, 2023, the Parent Control Persons made the requisite Form A filing with the state insurance regulators in Missouri, seeking approval of the acquisition of the control of Ozark National Life.

It is also expected that Parent will request approval in Arizona to receive the capital contributions required to fund the merger consideration, including the capital contribution of the proceeds from the debt financing. In addition, if required under applicable law, Parent will request approval in Arizona for its investment in National Western and certain of its non-insurance subsidiaries. These approvals are also conditions to the closing. For additional information regarding these capital contributions, please refer to the section titled “The Merger Agreement — Financing.”

The merger cannot be consummated before the parties have obtained approvals of the Arizona and Missouri Form A and related filings, as well as approval of the redomestication from the Colorado and Arizona insurance regulators without the imposition of a Burdensome Condition. There can be no assurance that each of these approvals will be obtained or when they will be obtained. Unrelated to the merger, National Western Life is currently undergoing its routine five-year financial examination in Colorado. Colorado has informed the Company that it will not be able to approve the redomestication request until the financial examination has been completed. Historically, the Company’s financial examination has been completed in April, but this examination may not be complete until the end of the second quarter. As for the Arizona process, it is Parent’s and National Western’s understanding that the Arizona insurance regulators intend to process the Form A and the redomestication on a substantially parallel basis, with a goal to be able resolve any issues relating to the Form A filing before Colorado finalizes the redomestication application.

The insurance laws and regulations of certain states also require that a pre-acquisition notification on Form E be filed with the state insurance regulatory authorities regarding the acquisition of control of a non-domiciliary insurance company doing business in that state if the acquisition would result in specified levels of market concentration (the “Form E Filings”). While these prior notification statutes do not authorize the state insurance regulatory authorities to disapprove the acquisition of control, they authorize regulatory action in the affected state, including requiring

the insurance company to cease and desist from doing certain types of business in the affected state. Pursuant to the merger agreement, the Company and Parent will use reasonable best efforts to cooperate and consult with each other in seeking such consents and making such notifications to the extent required.

United States Antitrust Filing

Under the HSR Act, the merger may not be completed until certain information and materials have been provided by Parent and the Company to the Antitrust Division and the FTC, and the applicable waiting period under the HSR Act has expired or been terminated and no Burdensome Condition has been imposed by any regulators as part of the regulatory approval process. The parties filed the required notifications with the Antitrust Division and the FTC on November 3, 2023, and the waiting period under the HSR Act is scheduled to expire on December 4, 2023, unless earlier terminated by the Antitrust Division or the FTC.

The Antitrust Division and the FTC frequently scrutinize the legality of transactions, such as the merger, under antitrust, competition and trade regulation law (the “antitrust laws”). At any time before or after the merger, the Antitrust Division, the FTC or a state attorney general could take action under the antitrust laws as it deems necessary or desirable in the public interest, including seeking to enjoin the merger or seeking divestiture of substantial businesses or assets of Parent, the Company or their respective affiliates. Private parties may also bring legal actions under the antitrust laws in certain circumstances. There can be no assurance that a challenge to the merger on antitrust grounds will not be made or, if a challenge is made, of the result.

Other Considerations

Upon the terms and subject to the conditions set forth in the merger agreement, the Company, Merger Sub and Parent are obligated to cooperate with each other and use (and cause their respective subsidiaries, and in the case of Parent, cause the Parent Control Persons (as defined below), to use) their respective reasonable best efforts to consummate the merger and the other transactions contemplated by the merger agreement as promptly as reasonably practicable. Their obligations in this regard include preparing and filing as promptly as reasonably practicable all documentation to effect all necessary filings, notices, petitions, statements, registrations, submissions of information, applications and other documents with certain governmental entities.

The merger agreement provides that Parent, Merger Sub and Parent Control Persons (i) may not undertake any action that could be reasonably expected to impose any material delay in the obtaining of, or significantly increase the risk of not obtaining, any consents, approvals, licenses, permits, orders, qualifications, authorizations of, or registrations or other actions by, or any filings with or notifications to, any governmental entity necessary to consummate the transactions contemplated by the merger agreement, including the merger, or the expiration or termination of any applicable waiting period, and (ii) are not required to take or refrain from taking, or agree to take, any Burdensome Condition.

“Parent Control Person” means (a) Prosperity Holding Company, as the 100% equity holder of Parent, (b) Prosperity Life Insurance Group, LLC as the 100% equity holder of Prosperity Holding Company, (c) Prosperity Group Holdings LP, as the 100% equity holder of Prosperity Life Insurance Group, LLC, (d) Bluejacket GP LLC, the general partner of Prosperity Group Holdings LP and (e) Jonathan Pollock as the controlling member of Bluejacket GP LLC.

THE MERGER AGREEMENT

This section describes the material terms of the merger agreement. The description in this section and elsewhere in this proxy statement is qualified in its entirety by reference to the complete text of the merger agreement, a copy of which is attached as Annex A and is incorporated by reference into this proxy statement. This summary does not purport to be complete and may not contain all of the information about the merger agreement that is important to you. We encourage you to read the merger agreement carefully and in its entirety. Information about the merger can be found elsewhere in this proxy statement and in the public filings we make with the SEC, as described in the section titled “Where You Can Find More Information” beginning on page 99.

Explanatory Note Regarding the Merger Agreement

The merger agreement has been included to provide investors and stockholders with information regarding its terms. The representations, warranties and covenants contained in the merger agreement were made by the parties thereto only for purposes of that agreement and as of specific dates; were made solely for the benefit of the parties to the merger agreement; may be subject to limitations agreed upon by the parties, including being qualified by confidential disclosures exchanged between the parties in connection with the execution of the merger agreement (such disclosures include information that has been included in the Company’s public disclosures, as well as additional non-public information); may have been made for the purposes of allocating contractual risk between the parties to the merger agreement instead of establishing these matters as facts; and may be subject to standards of materiality applicable to the parties that differ from those applicable to investors. Investors should not rely on the representations, warranties and covenants or any descriptions thereof as characterizations of the actual state of facts or condition of the Company, Parent, Merger Sub or any of their respective subsidiaries or affiliates. Additionally, the representations, warranties, covenants, conditions and other terms of the merger agreement may be subject to subsequent waiver or modification. Moreover, information concerning the subject matter of the representations, warranties and covenants may change after the date of the merger agreement, which subsequent information may or may not be fully reflected in the Company’s public disclosures.

Form of Merger

Upon the terms and subject to the conditions of the merger agreement and in accordance with the DGCL, at the effective time, Merger Sub will be merged with and into the Company. As a result of the merger, the separate corporate existence of Merger Sub will cease, and the Company will be the surviving entity in the merger and will become an indirect, wholly-owned subsidiary of Parent. Following the merger, the Class A common stock will no longer be publicly traded, will be delisted from NASDAQ and will be deregistered under the Exchange Act.

Consummation and Effectiveness of the Merger

The merger will become effective upon the Company’s filing of a certificate of merger with the Secretary of State of the State of Delaware or at such later time as may be agreed by the Company and Parent and set forth in the certificate of merger. The closing of the merger will occur on the date that is the fifth business day following the date of the satisfaction or waiver of the conditions to consummation of the merger set forth in the merger agreement (other than those conditions that by their terms are to be satisfied at the closing) or at such other time as the Company and Parent may agree in writing.

Consideration to Be Received in the Merger

At the effective time, each share of Company common stock issued and outstanding immediately prior to such time will be converted automatically into the right to receive $500.00 in cash without interest (as defined above, the “merger consideration”), less any applicable withholding taxes, and each outstanding and unvested Company PSU, Company RSU and Company SAR Award will vest and be converted into the right to receive the cash payment described below in the section titled “— Treatment of Outstanding Equity-Based Awards.” However, the merger consideration will not be paid in respect of (a) any shares of Company common stock (i) owned by the Parent or Merger Sub (or any of their wholly-owned subsidiaries) immediately prior to the effective time or (ii) held in treasury

of the Company and (b) shares of Company common stock outstanding immediately prior to the effective time that are held by a holder who has not consented to the merger, has properly demanded appraisal of such shares in accordance with Delaware law, and as of the effective time, has not waived, withdrawn or lost rights to such appraisal under Delaware law (“appraisal shares”).

Appraisal Shares

Appraisal shares will not be converted into the right to receive the merger consideration, but, instead, holders of appraisal shares will be entitled to payment of the fair value of such shares in accordance with Section 262 of the DGCL. If any such holder of appraisal shares fails to perfect or otherwise waives, withdraws or loses the right to appraisal under Section 262 of the DGCL or a court of competent jurisdiction determines that such holder is not entitled to the relief provided by Section 262 of the DGCL, then the right of such holder to be paid the fair value of such holder’s appraisal shares under the DGCL will cease and such appraisal shares will be deemed to have been converted at the effective time into, and will have become, the right to receive the merger consideration without interest or any other payments. The Company will provide prompt written notice to Parent of any demands for appraisal, attempted waivers or withdrawals of such demands and any other instruments served pursuant to the DGCL received by the Company, and Parent will have the right to direct, in consultation with the Company, all negotiations and proceedings with respect to such demands. The Company has agreed not to, without the prior written consent of Parent, make any voluntary payment with respect to, or settle or offer to settle, any such demands or approve any withdrawal of such demands, or agree to do any of the foregoing.

Treatment of Outstanding Equity-Based Awards

Upon the effective time, each Company PSU, Company RSU and Company SAR Award, whether vested or unvested that is outstanding immediately prior to the effective time, will be canceled in exchange for the right to receive the cash payment described below:

•        At the effective time, each Company PSU will be canceled in exchange for solely a cash payment, without interest, equal to the product of (i) the total number of shares of Company common stock subject to such award immediately prior to the effective time (based on target performance) multiplied by (ii) the $500 per share merger consideration.

•        At the effective time, each Company RSU will be canceled in exchange for solely a cash payment, without interest, equal to the product of (i) the total number of shares of Company common stock subject to such award immediately prior to the effective time multiplied by (ii) the $500 per share merger consideration.

•        At the effective time, each Company SAR Award will be canceled in exchange for solely a cash payment, without interest, equal to the product of (i) the total number of shares of Company common stock subject to such award immediately prior to the effective time multiplied by (ii) the excess, if any, of $500 per share merger consideration over the exercise price per share. However, if the exercise price per share for a Company SAR Award is equal to or greater than the $500 per share merger consideration, then that Company SAR Award will be cancelled in exchange for no consideration.

The payments with respect to equity-based awards will be paid through the surviving corporation’s payroll.

Exchange Procedures

Contemporaneously with the effective time, Parent must deposit, or cause to be deposited, with a bank, trust company, or nationally recognized stockholder services provider (or other provider reasonably acceptable to the Company) (the “paying agent”), in trust for the benefit of holders of shares of Company common stock entitled to the merger consideration, the amount of cash sufficient to pay the aggregate merger consideration. Parent, surviving corporation or the paying agent will send to each holder of record of shares of Company common stock that were converted into the right to receive merger consideration, a letter of transmittal and instructions for use in effecting the surrender of certificates that formerly represented shares in exchange for the merger consideration. Holders of book-entry shares will, after submitting a properly completed letter of transmittal to the paying agent, be entitled to

receive the merger consideration, without interest and less any applicable withholding taxes, without any further action required on the part of those holders. Holders of certificated shares must, in addition to the properly completed letter of transmittal, surrender such certificates (or an affidavit of loss in lieu thereof).

Representations and Warranties

The merger agreement contains representations and warranties of the Company, Parent and Merger Sub regarding, among other things:

•        organization, standing and power;

•        approvals of the merger agreement and transactions contemplated thereby;

•        governmental consents and approvals;

•        absence of contravention with organizational documents and other agreements;

•        litigation and investigations;

•        accuracy of information supplied for inclusion in this proxy statement; and

•        brokers’ and finders’ fees;

The Company made additional representations and warranties regarding, among other things:

•        capital structure;

•        SEC reporting;

•        compliance of financial statements with accounting requirements, regulations and GAAP;

•        statutory statements;

•        certifications required under the Sarbanes-Oxley Act;

•        internal controls over financial reporting;

•        accounting and auditing practices;

•        disclosure controls;

•        general compliance with laws and regulations (including insurance laws and regulations) and listing standards of NASDAQ;

•        absence of certain changes and events since December 31, 2022;

•        absence of undisclosed material liabilities;

•        taxes (including as related to insurance products);

•        compensation and benefits;

•        labor matters;

•        environmental matters;

•        real property and leasehold matters;

•        material contracts;

•        intellectual property;

•        data privacy and security;

•        permits;

•        Opinion of National Western’s Financial Advisor;

•        insurance maintained by the Company and its subsidiaries;

•        anti-takeover statutes and defenses;

•        related party agreements;

•        actuarial analysis;

•        insurance reserves;

•        reinsurance contracts;

•        investment assets;

•        insurance contracts; and

•        registration of N.I.S. as a broker-dealer.

Parent and Merger Sub made additional representations and warranties regarding, among other things:

•        delivery of the capital commitment letter and the debt commitment letter;

•        absence of transactions that would (i) materially delay obtaining, or significantly increase the risk of not obtaining, any approvals of any governmental entity necessary to consummate the merger, (ii) significantly increase the risk of any governmental entity entering a governmental order prohibiting the merger or (iii) materially delay the consummation of the merger;

•        persons who, following the closing of the merger, could be deemed to control or exercise significant influence over the management of the Company and its subsidiaries; and

•        Parent’s and affiliates’ (i) absence of “interested stockholder” status and (ii) non-ownership of voting stock, in the Company in the past three years.

Certain of the representations and warranties in the merger agreement are qualified as to “materiality,” “Company Material Adverse Effect” or “Parent Material Adverse Effect.”

The merger agreement provides that a “Company Material Adverse Effect” means any state of facts, change, development, event, effect, condition or occurrence that, individually or in the aggregate, would be reasonably likely to (a) prevent, materially impair or materially delay the Company’s ability to consummate the transactions contemplated by the merger agreement, including the merger, on or before July 8, 2024 (or, under certain circumstances, October 8, 2024) (as defined above, as applicable, the “outside date”) or the performance by the Company of any of its material obligations under the merger agreement or (b) have a material adverse effect on the condition (financial or otherwise), business, operations, assets and liabilities (considered together) or results of operations of the Company and its subsidiaries, taken as a whole. The merger agreement also provides, however, that, with respect to clause (b) above, in no event will any of the following states of fact, changes, developments, events, effects, conditions or occurrences, alone or in combination, be deemed to constitute, or be taken into account, in determining whether there has been, or would be, a Company Material Adverse Effect:

•        changes in general U.S. or global economic conditions or securities, credit, financial or other capital markets conditions;

•        changes, events or conditions in the industries in which the Company and its subsidiaries operate (including changes to interest rates, general market prices and regulatory changes affecting such industries);

•        pandemics (including COVID-19 and any variants/mutations thereof), epidemics, acts of war, armed hostility, sabotage, terrorism, widespread cyber-attack or man-made disaster, or any natural disaster or other act of nature and any escalation or general worsening of the foregoing;

•        changes arising out of the negotiation, execution or announcement of, or entering into, the merger agreement, or the pendency or consummation of the transactions contemplated by the merger agreement, including the merger;

•        changes in applicable law or in GAAP, SAP or in accounting standards or in the interpretation or enforcement of any of the foregoing;

•        change in the market price or trading volume, of the Company’s capital stock;

•        failure to meet any internal or public projections, forecasts, guidance, estimates, milestones, budgets or predictions;

•        change or development in the credit, financial strength, claims paying ability, insurance or other rating of the Company, any of its subsidiaries or its outstanding debt;

•        performance of the merger agreement or the transactions contemplated by the merger agreement, including compliance with covenants set forth therein (but in the event of a failure by the Company or its subsidiaries to take any action, only if Parent has refused to provide a waiver to the applicable prohibition in the merger agreement within five business days after the request), the identity of or facts related to Parent, Merger Sub or their respective affiliates or any action taken or omitted to be taken by the Company at the prior written request of Parent or Merger Sub;

•        effects of any breach of the merger agreement by Parent or Merger Sub; or

•        change in the value of the investment assets of the Company or any of its subsidiaries.

With respect to the first, second and third items listed above, those states of fact, changes, developments, events, effects, conditions or occurrences will be taken into account in determining whether there has been, or would reasonably be expected to be, a Company Material Adverse Effect, solely to the extent the impact on the Company and its subsidiaries, taken as a whole, is disproportionately adverse compared to the impact on other companies operating in the industries in which the Company and its subsidiaries operate in the countries and regions in the world impacted by the state of fact, change, development, event, effect, condition or occurrence in question.

The merger agreement provides that “Parent Material Adverse Effect” means any state of facts, change, development, event, effect, condition or occurrence that would or would be reasonably likely to, individually or in the aggregate, prevent, materially impair or materially delay Parent’s or Merger Sub’s ability to perform its material obligations under the merger agreement or to consummate the transactions contemplated by the merger agreement, including the merger, on or before the outside date.

Conduct of Business by the Company Prior to Consummation of the Merger

The Company has agreed to certain covenants in the merger agreement restricting the conduct of the business of the Company and its subsidiaries between the date of the merger agreement and the earlier of the effective time and the termination of the merger agreement. The general effect of these covenants is that, during such interim period, the Company and its subsidiaries will be limited in their ability to pursue strategic and operational matters outside the ordinary course of business. The Company has agreed that it and its subsidiaries will conduct their business in the ordinary course consistent with past practice in all material respects and use reasonable best efforts to preserve their business organizations and goodwill, keep available the services of their current key officers and employees, and preserve their present relationships with governmental entities and other key third parties, including customers, reinsurers, distributors, suppliers and other persons with whom the Company and its subsidiaries have business relationships.

In addition, the Company has agreed to specific restrictions relating to the conduct of the business of the Company and its subsidiaries between the date of the merger agreement and the earlier of the effective time and the termination of the merger agreement, including, but not limited to, not to take (or permit any of its subsidiaries to take) the following actions (subject, in each case, to exceptions specified below and in the merger agreement or previously disclosed in writing to Parent as provided in the merger agreement or as consented to in writing in advance by Parent (which consent shall not be unreasonably withheld, delayed or conditioned)) or as required by law:

•        subject to certain limited exceptions, offer, issue, sell, transfer, pledge, dispose of or encumber any shares of, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of capital stock or other equity or voting interests or ownership interests of any class or series of the Company or its subsidiaries;

•        amend or propose to amend the Company’s or its subsidiaries’ certificate of incorporation, bylaws or other comparable organizational documents;

•        authorize, recommend, propose, enter into or adopt a plan or agreement of complete or partial liquidation, rehabilitation, dissolution, merger, consolidation, restructuring, recapitalization or other reorganization of the Company or any of its subsidiaries;

•        merge, consolidate, combine or amalgamate with any person;

•        subject to certain limited exceptions (including permitting the Company to execute investment portfolio transactions in the ordinary course of business consistent with past practice and in accordance with its existing investment guidelines), acquire or agree to acquire any business or any corporation, partnership, association or other business organization or division thereof or any other assets for consideration in excess of $1,250,000 individually or $2,500,000 in the aggregate;

•        make or authorize capital expenditures that are, on an individual basis, in excess of 150% of the individual line items of the Company’s capital expenditure budget or in excess of 125% of the aggregate capital expenditure budget, except for (i) planned capital expenditures disclosed to Parent at signing of the merger agreement, (ii) reasonable emergency capital expenditures necessary to maintain its ability to operate its businesses in the ordinary course or for the safety of individuals, assets or the environment and (iii) capital expenditures for maintenance purposes with respect to investment assets that are real estate;

•        except as required under applicable law or the terms of any Company benefit plan:

•        increase the compensation or benefits of any current or former director, officer, employee or independent contractor of the Company or its subsidiaries, except for increases to base salary or wage rate for any employee or independent contractor, as applicable (other than with respect to (i) certain officers and (ii) employees and independent contractors whose base salary or wage rate, as applicable, is equal to or greater than $180,000 (each, a “covered person”)) in the ordinary course of business consistent with past practice and subject to certain limits; enter into or adopt any employment, change in control, severance or retention agreement, or grant to any current or former director, officer, employee or independent contractor of the Company or its subsidiaries any (or any increase or enhancement of any) severance, change in control or retention pay, except (i) for any such agreements or any such grants of severance pay to an employee who has been hired to replace an employee with such an agreement, or (ii) for employment or service agreements terminable without notice, severance or penalty payments for a new employee or independent contractor;

•        pay any incentive compensation, other than short-term bonuses for completed periods based on actual performance in the ordinary course of business consistent with past practice and the terms of the applicable Company benefit plan;

•        grant any new equity-based award or amend, enhance or modify the terms of any outstanding award;

•        amend or modify any performance criteria, metrics or targets under any Company benefit plan such that, as compared to those criteria, metrics or targets under any Company benefit plan in effect as of the date of the merger agreement, the performance criteria, metrics or targets would be reasonably likely to be materially more likely to be achieved than in the absence of such amendment or modification;

•        establish, adopt, enter into or amend in any material respect any (i) except as otherwise in compliance with the preceding sub-bullets, Company benefit plan or (ii) collective bargaining agreement or other agreement with any labor union or other employee representative organization;

•        change any actuarial or other assumptions used to calculate funding obligations with respect to any Company benefit plan or change the manner in which contributions to such plans are made or the basis on which such contributions are determined, except as may be required by GAAP; or

•        loan or advance any money or other property to any current or former employee, director, officer or other individual service provider (other than routine advancement of business expenses in the ordinary course of business consistent with past practice);

•        subject to certain limited exceptions, sell, lease, license, transfer, pledge, encumber or otherwise dispose of any of the Company’s or its subsidiaries’ assets or properties;

•        incur, guarantee or assume any indebtedness (other than indebtedness owing between or among the Company and any of its wholly-owned subsidiaries), subject to certain limited exceptions, including investment portfolio transactions in the ordinary course of business consistent with past practice and other incurrences of indebtedness not to exceed $5,000,000 in the aggregate;

•        enter into any material contract or reinsurance contract other than in the ordinary course of business consistent with past practice;

•        terminate, amend, modify, assign or waive any material right under any material contract or reinsurance contract except in the ordinary course of business consistent with past practice;

•        hire any person to be an officer or employee of the Company or any of its subsidiaries or engage any other independent contractor to provide services to the Company or any of its subsidiaries, other than the hiring of an employee or the engagement of any other independent contractor who would not be a covered person (i) to fill a vacancy identified as of the date of the merger agreement or (ii) to replace any employee or independent contractor other than a covered person who resigns or retires, whose employment or service is terminated for cause or with the consent of Parent;

•        terminate the employment of (i) any covered person other than for cause or (ii) any group of employees that would implicate certain notice requirements under law;

•        (i) enter into any collective bargaining agreement or other agreement with any labor union or other employee representative organization or (ii) voluntarily recognize or certify any labor union or other employee representative organization, or group of employees of the Company or any of its subsidiaries as the bargaining representative for any employees of the Company or its subsidiaries;

•        redeem, purchase or otherwise acquire directly or indirectly any of the Company’s or its subsidiaries’ capital stock or other voting or equity interests of the Company or its subsidiaries;

•        settle or compromise any claim, demand, lawsuit or state or federal regulatory proceeding or waive any claims, other than with respect to the Company’s and its subsidiaries’ ordinary course claims activity, (i) in an amount in excess of $1,250,000 individually or $2,500,000 in the aggregate or (ii) that imposes any material obligation to be performed by, or material restriction imposed against, the Company or its subsidiaries;

•        except for any such change that is required by GAAP, SAP, applicable law or governmental entity, make any actuarial change in (i) underwriting, pricing, reserving, claims administration, investment, risk management, as applicable, in effect on the date of the merger agreement other than, any change made in the ordinary course of business consistent with past practice, (ii) financial accounting (other than any change for tax purposes) methods, practices or principles used by the Company or any of its Subsidiaries, or (iii) the investment guidelines or any investment or hedging practice, guideline or policy, as applicable, in effect on the date of the merger agreement; or

•        make any loan, capital contribution or advance to or investment in any other person (other than the Company or its wholly-owned subsidiaries in the ordinary course of business consistent with past practice or in compliance with the Company’s investment guidelines).

The merger agreement permits the Company to continue to pay regular annual cash dividends not to exceed $0.36 per share of Class A common stock and $0.18 per share of Class B common stock prior to completion of the merger. Accordingly, on October 26, 2023, the National Western board of directors declared a cash dividend in the respective per share amounts described above, payable December 1, 2023 to stockholders of record as of November 6, 2023.

Efforts to Complete the Merger

Under the terms of the merger agreement, the Company, Merger Sub and Parent are obligated to cooperate with each other and use (and cause their respective subsidiaries, and in the case of Parent, cause the Parent Control Persons, to use) their respective reasonable best efforts to promptly take or cause to be taken all actions necessary, proper or advisable to consummate in the most expeditious manner reasonably practicable, the merger and the other transactions contemplated by the merger agreement, including using reasonable best efforts to:

•        prepare and file promptly and fully all documentation to effect all necessary filings, notices, petitions, statements, registrations, submissions of information, applications and other documents; and

•        obtain as soon as reasonably practicable all consents required to be obtained from any governmental entity or third party that are necessary, proper or advisable to consummate the merger and the other transactions contemplated by the merger agreement (the “required consents”). The obligations of Parent and Merger Sub under the merger agreement to consummate the transactions contemplated by the merger agreement (including the merger) are not, however, subject to conditions relating to obtaining third-party consents.; and

•        cooperate with each other to lift any injunctions or remove any other impediment to the consummation of the transactions contemplated by the merger agreement.

The Company, Parent and Merger Sub are further required to:

•        keep each other apprised of the status of matters relating to the completion of the merger and the other transactions contemplated by the merger agreement;

•        work cooperatively in connection with obtaining all required approvals or consents of any governmental entity whose consent is a required consent in connection with the merger and the other transactions contemplated by the merger agreement;

•        consult with each other regarding all filings made with, and additional information submitted to, any governmental entity whose consent is a required consent in connection with the merger or any other transaction contemplated by the merger agreement, including all Form A Filings, pre-acquisition notifications on Form E or similar market share notifications, and information provided under the HSR Act;

•        promptly inform each other of any communication with any governmental entity whose consent is a required consent regarding the merger and the other transactions contemplated by the merger agreement, and permit each other to review in advance any proposed communication to any governmental entity whose consent is a required consent;

•        provide the other party with the opportunity to participate in any meeting with any governmental entity whose consent is a required consent in respect of any substantive filing, investigation or other inquiry in connection with the transactions contemplated by the merger agreement; and

•        furnish to each other copies of all correspondence and filings with any governmental entity whose consent is a required consent related to requests for additional information or from any governmental entity whose consent is a required consent with respect to the merger and the other transactions contemplated by the merger agreement.

Merger Sub and Parent are obligated to, and must cause their respective subsidiaries, and in the case of Parent, cause the Parent Control Persons, to file or cause to be filed with the applicable governmental entities, (i) the Form A Filings, (ii) the Form E Filings or similar market share notifications, and (iii) declarations, filings and notifications necessary to obtain the required consents, in each case, as soon as reasonably practicable and, in any event, with respect to (i) and (ii) within 20 business days of the date of the merger agreement. Upon the request of Parent, the Company must also, and must cause its subsidiaries to, provide reasonable cooperation and assistance to Parent in its submission or filing of certain filings with applicable departments of insurance.

The Company, at its own expense, is obligated to (i) as promptly as practicable, but in no event later than 20 business days following the date of the merger agreement, cause N.I.S. to file or cause to be filed a CMA for approval of a change in ownership or control of N.I.S. under FINRA Rule 1017 with FINRA and request “fast track” treatment and (ii) as soon as reasonably practicable, cause N.I.S. to file or cause to be filed notice or other filing with any applicable state securities authority. N.I.S. plans to submit its CMA to FINRA as soon as practicable.

Under the merger agreement, the Company and Parent were obligated to submit notifications required under the HSR Act relating to the transactions contemplated by the merger agreement (including the merger) by November 6, 2023 and are further obligated to file other materials required under antitrust laws with respect to the transactions (including the merger) in the applicable jurisdictions as promptly as reasonably practicable. The parties filed the required notifications with the Antitrust Division and the FTC on November 3, 2023, and the waiting period under the HSR Act is scheduled to expire on December 4, 2023, unless earlier terminated by the Antitrust Division or the FTC.

Parent shall, and shall cause each of its applicable affiliates, subsidiaries and the Parent Control Persons to, as applicable (i) not take any action with the intention to, or that could be reasonably likely to, hinder or materially delay the expiration or termination of any waiting period under the HSR Act or the obtaining of the required consent of any governmental entity as necessary, (ii) each use its reasonable best efforts to avoid the entry of, or to have vacated or terminated, any decree, order or judgment that would restrain, prevent or delay the closing, on or before the outside date, and (iii) each use its reasonable best efforts to avoid or eliminate each and every impediment under any antitrust laws so as to enable the closing to occur as soon as reasonably possible (and in any event no later than the outside date).

None of Parent, Merger Sub any Parent Related Person or any Parent Control Person is required to take or refrain from taking or agree to take any “Burdensome Condition,” which means any limitation, action, restriction, condition or requirement that, individually or together with all other such limitations, actions, restrictions, conditions or requirements, would, or would be reasonably likely to (i) require, obligate or otherwise involve any action to be taken by, impose any restriction on Parent, Merger Sub, Company or any of its subsidiaries or Parent Control Persons, or any of their respective affiliates to (A) sell, license, assign, transfer, divest, hold separate or otherwise dispose of, before or after the closing, any assets or businesses or (B) contribute material capital or enter into any material guarantee, “keep well” or capital maintenance arrangements, maintain a material specified risk based capital restriction on behalf of such party or its affiliates, (ii) require any material and adverse deviation from those “key terms” of the Parent’s business plan provided to Company in advance, (iii) require, obligate or otherwise involve any action to be taken by, impose any restriction on, have any adverse effect on, or require any information disclosure of any Parent Related Person, other than identifying each of Elliott Associates, L.P., Elliott International, L.P., Elliott Intermediate Co-Investment I L.P. and Elliott Intermediate Co-Investment II L.P. as an indirect equityholder of Parent or (iv) require anyone other than the Parent Control Persons to file as the “ultimate control person” of Parent, Company or any of their subsidiaries, or make any similar filing with any applicable insurance regulator. The Company may not (and must cause its subsidiaries not to), without the prior written consent of Parent, take or agree to take or refrain from any action or accept any limitation, action, restriction, condition or requirement that, individually or in the aggregate, would, or would be reasonably likely to, result in a Burdensome Condition.

Voting and Support Agreements

On October 8, 2023, the Moody Revocable Trust, Ross Moody (together with an investment partnership managed by him), Russell Moody (together with an investment partnership co-managed by him), and Frances Moody-Dahlberg (together with an investment partnership managed by her) (collectively, the “Supporting Stockholders”) each entered into a separate voting and support agreement with Parent with respect to the merger agreement. Collectively, the Supporting Stockholders beneficially own approximately 29.68% of the combined voting power of the Class A common stock and Class B common stock, including 99% of the outstanding shares of Class B common stock.

Each Supporting Stockholder’s voting and support agreement generally requires that Supporting Stockholder to vote or cause to be voted all Company common stock owned by that Supporting Stockholder in favor of any proposal to adopt the merger agreement and against alternative transactions. Subject to certain exceptions, the voting and support agreements also contain prohibitions applicable to the Supporting Stockholders that are consistent with the non-solicitation provisions of the merger agreement.

In addition, subject to limited exceptions, until the termination of each Supporting Stockholder’s voting and support agreement, that voting and support agreement restricts that Supporting Stockholder from selling or otherwise transferring Company common stock owned by that Supporting Stockholder.

Robert Moody, the grantor of the Moody Revocable Trust, passed away on November 7, 2023. Under the terms of the Moody Revocable Trust, the shares of Class B common stock pass to the Three R Trust, a trust created by Robert Moody for the benefit of his children and their lineal descendants. The trustee of the Moody Revocable Trust, however, is authorized to retain trust properties, including the shares of Class B common stock, for as long as is necessary to administer the trust and Mr. Moody’s estate, including the payment of debts, expenses and taxes. Therefore, upon Robert Moody’s death, Three R Trust acquired beneficial ownership of the shares of Class B common stock held by the Moody Revocable Trust. However, legal title will remain with the Moody Revocable Trust for the foreseeable future. Therefore, until the transfer of legal title to Three R Trust, Moody Bank, as trustee of the Moody Revocable Trust, retains the voting power with respect to those shares of Class B common stock. In addition, the Moody Revocable Trust’s voting and support agreement permits legal title to the Class B common stock to be transferred to Three R Trust in the event of Robert Moody’s death, but expressly provides that the transferred shares would remain subject to the obligations set forth in the voting and support agreement, including the Moody Revocable Trust’s grant of an irrevocable proxy to Parent to vote the shares of Class B common stock held by the Moody Revocable Trust in favor of adopting the merger agreement.

Competing Proposals

The Company has agreed that it will not, and will cause its subsidiaries and its and their respective representatives not to, directly or indirectly:

•        initiate, solicit, propose or knowingly encourage or knowingly facilitate the submission of any inquiry or the making of any proposal or offer that constitutes, or would be reasonably likely to lead to or result in, a competing proposal (as defined below);

•        engage in, continue or participate in any discussions relating to or any inquiry, proposal or offer that would reasonably be expected to lead to or result in a competing proposal;

•        furnish any non-public information regarding the Company or its subsidiaries, or access to the properties, assets or employees of the Company or its subsidiaries, to any person in connection with or in response to any competing proposal or any inquiry, proposal or offer that would be reasonably likely to lead to or result in a competing proposal;

•        approve, adopt or enter into any letter of intent or agreement in principle relating to a competing proposal;

•        take any action to make the provisions of any takeover law or similar provision in National Western’s organizational documents inapplicable to any transactions contemplated by a competing proposal;

•        submit any competing proposal to a vote or consent of the stockholders of the Company; or

•        resolve, propose or agree to do any of the above.

However, notwithstanding the restrictions described above, the Company or any of its representatives may, (i) in response to an unsolicited inquiry or proposal that did not result from a material breach of the non-solicitation restrictions described above, request information reasonably necessary to clarify the terms and conditions of such inquiry or proposal to determine whether such inquiry or proposal constitutes, or is reasonably likely to lead to or result in, a superior proposal (as defined below) and (ii) in response to an inquiry or proposal from a third party, inform a third party or its representatives of the restrictions imposed by the non-solicitation restrictions described above.

Furthermore, under the merger agreement, the National Western board of directors may not:

•        withhold, withdraw, qualify or modify, or publicly propose or announce any intention to withhold, withdraw, qualify or modify, in a manner adverse to Parent or merger sub, the board recommendation to approve the merger in this proxy statement;

•        fail to include the board recommendation to approve the merger agreement in this proxy statement (including when filed with the SEC or disseminated to the Company’s stockholders);

•        adopt, approve, endorse or recommend, or publicly propose or announce any intention to adopt, approve, endorse or recommend, any competing proposal;

•        publicly declare advisable or publicly propose to enter into, or authorize, cause or permit the Company or its subsidiaries to enter into any letter of intent, memorandum of understanding, agreement in principle, acquisition agreement, merger agreement, option agreement, joint venture agreement, partnership agreement or other agreement (an “alternative acquisition agreement”);

•        in the case of a competing proposal that is structured as a tender offer or exchange offer, fail to recommend, in a solicitation/recommendation statement, against acceptance of such tender offer within a specified period of time; or

•        if, after the date of the merger agreement, a competing proposal has been publicly announced or publicly disclosed, fail to publicly reaffirm the board’s recommendation to approve the merger prior to (i) five business days after Parent requests the reaffirmation in writing or (ii) three business days prior the date of the Special Meeting, whichever is earlier (together with any of the other foregoing actions, a “change in recommendation”).

Notwithstanding the restrictions described above, the National Western board of directors may, after consultation with the Company’s outside legal counsel, make such disclosures as the National Western board of directors determines in good faith, that the failure to do so would be inconsistent with the fiduciary duties of the National Western board of directors under applicable law. However, any disclosure that relates to a competing proposal will be deemed to be a change in recommendation unless the National Western board of directors reaffirms the board’s recommendation to approve the merger in such disclosure.

Notwithstanding the foregoing, any time prior to, but not after, the Company’s receipt of the stockholder approval following the execution of the merger agreement the Company and its representatives may solicit, propose, encourage, or facilitate any inquiry or the making of any proposal or offer with respect to such competing proposal or any modification thereto with any person if the Company receives a bona fide written competing proposal from such person that was not solicited in material breach of the foregoing non-solicitation provisions.

A “competing proposal” is defined as any bona fide written offer or proposal for, or any bona fide written indication of interest in, any direct or indirect, in a single transaction or series of related transactions:

•        acquisition of any business or assets of the Company or its subsidiaries representing 20% or more of the net revenues, net income or assets of the Company and its subsidiaries taken as a whole;

•        sale of equity representing 20% or more of any class of equity securities of the Company or any of its subsidiaries whose business constitutes 20% or more of the net revenues, net income or assets of the Company and its subsidiaries taken as a whole;

•        tender offer or exchange offer that would result in the beneficial ownership of 20% or more of any class of equity securities of the Company or any of its subsidiaries whose business constitutes 20% or more of the net revenues, net income or assets of the Company and its subsidiaries taken as a whole; or

•        merger, consolidation, business combination, joint venture, partnership, recapitalization, liquidation, dissolution or similar transaction involving the Company or any of its subsidiaries whose business constitutes 20% or more of the net revenue, net income or assets of the Company and its subsidiaries taken as a whole.

A “superior proposal” is defined as a competing proposal (with all references to 20% included in the definition of competing proposal increased to 50%) that is not solicited after the date of the merger agreement in violation of the terms thereof and is made after the date of the merger agreement by any person (other than the Parent) that in the good faith determination of the National Western board of directors — after consultation with its financial advisors and outside legal counsel and after taking in to account relevant aspects of the proposal (including estimated timing and legal, financial, regulatory, stockholder approval requirements, any third-party consents, financing and other aspects) — would, if consummated, result in a transaction more favorable to the Company stockholders than the merger, is reasonably likely to be consummated on the terms proposed and for which, if applicable, financing is fully committed or reasonably determined to be available by the National Western board of directors.

Change in Recommendation

At any time prior to, but not after, the receipt of the Company stockholder approval, the National Western board of directors may effect a change in recommendation or may terminate the merger agreement if the Company receives a bona fide written competing proposal from a third party that was not solicited in material breach of the merger agreement’s non-solicitation proposals, and:

•        the National Western board of directors determines in good faith (i) after consultation with its financial advisors and outside legal counsel, that such competing proposal is a superior proposal and (ii) after consultation with the Company’s outside legal counsel, that failure to effect a change in recommendation in response to such superior proposal would be inconsistent with the fiduciary duties owed by the National Western board of directors to the stockholders of the Company under applicable law;

•        the Company provides Parent written notice of such proposed action and the basis thereof at least four business days in advance;

•        after giving such notice and prior to effecting such change in recommendation or termination, the Company negotiates in good faith with Parent (to the extent Parent wishes to negotiate) to make such adjustments or revisions to the terms of the merger agreement as would obviate the need for the National Western board of directors to effect a change in recommendation or terminate the merger agreement; and

•        at the end of the four business day period, prior to taking action to effect a change in recommendation or terminate the merger agreement, the National Western board of directors takes into account any adjustments or revisions to the terms of the merger agreement proposed by Parent in writing and determines in good faith after consultation with the Company’s financial advisors and outside legal counsel that the competing proposal remains a superior proposal and, after consultation with outside legal counsel, that the failure to effect a change in recommendation in response to such superior proposal would be inconsistent with the fiduciary duties owed by the National Western board of directors to the stockholders of the Company under applicable law.

Additionally, at any time prior to, but not after, the receipt of the Company stockholder approval, the National Western board of directors may effect a change in recommendation or terminate the merger agreement in response to an intervening event that occurs or arises after the date of the merger agreement and that did not arise from or in connection with a breach of the merger agreement, and:

•        the National Western board of directors determines in good faith (i) after consultation with the Company’s financial advisors and outside legal counsel that an intervening event has occurred and (ii) after consultation with the Company’s outside legal counsel, that failure to effect a change in recommendation in response to such intervening event would be inconsistent with the fiduciary duties owed by the National Western board of directors to the stockholders of the Company under applicable law;

•        the Company provides Parent written notice of such proposed action and the basis thereof at least four business days in advance, which notice shall set forth in writing that the National Western board of directors intends to consider whether to take such action and includes a reasonably detailed description of the facts and circumstances of the intervening event and the reasons for making the change in recommendation;

•        after giving such notice and prior to effecting such change in recommendation, the Company negotiates in good faith with Parent (to the extent Parent wishes to negotiate) to make such adjustments or revisions to the terms of the merger agreement as would obviate the need for the National Western board of directors to effect a change in recommendation; and

•        at the end of the four business day period, prior to taking action to effect a change in recommendation, the National Western board of directors takes into account any adjustments or revisions to the terms of the merger agreement, proposed by Parent in writing, and determines in good faith after consultation with the Company’s outside legal counsel, that the failure to effect a change in recommendation in response to such intervening event would be inconsistent with the fiduciary duties owed by the National Western board of directors to the stockholders of the Company under applicable law.

An “intervening event” is defined as a material development, event, occurrence or change in circumstance that occurs or arises after the date of the merger agreement that was not known to or reasonably foreseeable by the National Western board of directors as of the date of the merger agreement, which becomes known to the National Western board of directors prior to obtaining the Company stockholder approval. However, intervening event does not include (a) the mere fact, in and of itself, that the Company or any of its subsidiaries meets or exceeds any projections, forecasts, estimates or predictions of revenue, earnings or other financial or operating metrics, (b) changes in the price or trading volume of the Company common stock, or (c) the receipt and existence of a competing proposal.

Financing

The total merger consideration of approximately $1.9 billion will be funded through a combination of (i) cash from internal sources, (ii) a capital commitment from affiliates of Elliott to Parent and PGH LP, and (iii) borrowings under existing facilities or debt commitments, the aggregate proceeds of which will provide Parent with the funds needed to consummate the merger, including to pay the aggregate merger consideration pursuant to the merger agreement.

Concurrently with the execution of the merger agreement, Parent, Prosperity Holding and PGH LP entered into certain agreements for capital financing and debt financing to facilitate Parent’s acquisition of the Company through the merger.

The obtaining of capital and debt financing is not, however, a condition to the merger, the closing, or Parent’s and Merger Sub’s obligations under the merger agreement, including payment of the aggregate merger consideration and other payments pursuant to the merger agreement.

Debt Financing

On October 8, 2023 Prosperity Holding entered into (i) the debt commitment letter with the Commitment Parties. Pursuant to the debt commitment letter, and subject to the terms and conditions set forth therein, the Commitment Parties agreed to provide, for the benefit of Prosperity Holding a term loan facility (with maturity date of December 7, 2027) in the aggregate principal amount of $310,000,000 (as defined above, such financing, the “debt financing”) for the purpose of funding, in part, Parent’s acquisition of the Company through its merger with Merger Sub and the fees and expenses incurred in connection therewith.

The merger agreement obligates Parent and Merger Sub to use their reasonable best efforts to, among other things, (i) maintain the debt commitment letter in effect until the merger is consummated or terminated in accordance with its terms, (ii) enforce Parent’s and Merger Sub’s rights under the debt commitment letter, and (iii) satisfy on a timely basis all conditions to funding under the debt commitment letter that are within their control and (iv) if possible, consummate the debt financing at or prior to the closing of the merger. Under the merger agreement, Parent, Merger Sub and the Company have agreed that Parent and Merger Sub will not permit any modification of their rights under the debt commitment letter that would, among other things, prevent or materially delay or impact the consummation of the merger. The Company has also agreed under the merger agreement to use reasonable best efforts to cooperate with Parent in connection with the debt financing.

Capital Financing

As a condition to the Company’s willingness to enter into the merger agreement, Elliott affiliates, Parent, and PGH LP executed and delivered the capital commitment letter, dated October 8, 2023, pursuant to which the Elliott affiliates committed to provide capital to PGH LP with an aggregate capital contribution equal to $800,000,000 ($370,000,000 of which may be in the form of subordinated loan made to Prosperity Holding) for the purpose of funding a portion of the aggregate merger consideration. The capital commitment letter provides that the Company is a third party beneficiary of the rights granted to Parent under the capital commitment letter solely for the purpose of seeking specific performance of the Elliott affiliates’ obligation to fund the commitment thereunder, subject to conditions set forth in the capital commitment letter. The capital commitment will be reduced by the amount of any debt actually funded at closing if and to the extent that such debt financing is used to fund the payment of merger consideration.

Employee Matters

From and after the effective time, Parent will, or will cause the Company to, honor all Company benefit plans in good faith in accordance with their respective terms. Further, Parent expressly assumes, from and after the effective time, certain change in control and employment agreements of the Company and its subsidiaries. For a period of one year following the effective time, Parent will provide, or will cause to be provided, to each employee of the Company or its subsidiaries who continues to remain employed with the Company or its subsidiaries immediately after the effective time (each, a “Company Employee”) with:

•        an annual base salary or hourly wage rate that is no less favorable than the annual base salary or hourly wage rate provided to the Company Employee immediately prior to the effective time;

•        target annual cash and target long-term incentive compensation opportunities (excluding any change in control and retention or other non-recurring compensation) that are no less favorable than those provided to the Company Employee immediately before the effective time; and;

•        other employee benefits (excluding long-term equity or equity-based compensation, defined benefit pension, nonqualified deferred compensation and post-employment welfare benefits) that are substantially comparable in the aggregate to those employee benefits (subject to the foregoing exclusions) provided to, in Parent’s discretion, either (or some combination of) (i) the Company Employee immediately prior to the effective time or (ii) Parent’s (or its affiliate’s) similarly-situated employees.

For all purposes under the employee benefit plans of Parent and its subsidiaries providing benefits to any Company Employee after the effective time (each such plan, a “New Plan”), each Company Employee will be credited with his or her years of service with the Company and its subsidiaries and their respective predecessors, to the same extent as such Company Employee was entitled, prior to the effective time, to credit for such service under any similar Company benefit plan in which such Company Employee participated or was eligible to participate immediately prior to the effective time. However, such credit cannot result in a duplication of benefits and will not apply with respect to benefit accrual under any defined benefit pension plan or for purposes of any post-employment welfare benefit plan.

In addition, (i) Parent will use reasonable best efforts to cause each Company Employee to be immediately eligible to participate in each New Plan to the extent such Company Employee was eligible to participate immediately prior to the effective time in a Company benefit plan providing analogous benefits (each such plan, a “Legacy Plan”), (ii) for purposes of each New Plan providing medical, dental, pharmaceutical and/or vision benefits to any Company Employee, all pre-existing condition exclusions and actively-at-work requirements of such New Plan will be waived for each Company Employee and his or her covered dependents, unless such conditions would not have been waived under the Legacy Plan and (iii) Parent will use reasonable best efforts to cause any eligible expenses incurred by each Company Employee and his or her covered dependents during the portion of the plan year of each Legacy Plan ending on the date such Company Employee’s participation in the corresponding New Plan begins to be taken into account under such New Plan for purposes of satisfying all deductible, coinsurance and maximum out-of-pocket requirements applicable to such Company Employee and his or her covered dependents for the applicable plan year as if such amounts had been paid in accordance with such New Plan.

To the extent the Company has not paid the entirety of the annual, quarterly or other short-term bonus or bonuses, as applicable, in respect of calendar year 2023 (the “unpaid 2023 bonus”) to an applicable Company Employee as of the closing date, then, no later than 30 days following the closing date of the merger, the Company will pay, or will cause to be paid, the unpaid 2023 bonus to such Company Employee, subject to such Company Employee remaining employed by the Company or any of its subsidiaries until (i) the date of such payment or (ii) in the event the employment of such Company Employee is terminated on or after December 31, 2023 without “cause” or is otherwise terminated in connection with the transactions contemplated by the merger agreement, December 31, 2023. The amount of such Company Employee’s unpaid 2023 bonus will be determined prior to the closing date of the merger by the Compensation Committee, in good faith consistent with the terms of the applicable Company benefit plan and, if applicable, award agreements, in each case as in effect on the date of the merger agreement.

Indemnification and Insurance

The merger agreement provides that, from and after the effective time, the surviving corporation and Parent will indemnify, defend and hold harmless to the fullest extent permitted by applicable law or provided under the Company’s certificate of incorporation and bylaws in effect as of immediately prior to the effective time all persons who were directors, advisory directors, officers or employees of the Company and its subsidiaries prior to the effective time for any losses, claims, damages, costs, fines, penalties, expenses (including attorneys’ and other professionals’ fees and expenses), liabilities or judgments or amounts that are paid in settlement or incurred in connection with any threatened or actual claim, action or investigation arising out of, relating to or in connection with such person’s role as a director, advisory director or officer of the Company or its subsidiaries.

Parent and the surviving corporation will not amend, repeal or otherwise modify in any manner that would adversely affect the rights of, and will fulfill and honor any rights of, any past and present directors, advisory directors and officers of the Company and its subsidiaries to indemnification, expense advancement or exculpation with respect to any act or omission occurring or existing at or prior to the effective time under (i) any indemnification, exculpation and advancement of expenses provisions of the Company charter, bylaws and organizational documents of any of the Company’s subsidiaries as in effect as of immediately prior to the effective, (ii) any indemnification, expense advancement or exculpation provisions in the in the organizational documents of the surviving corporation or and (3) any indemnification, expense advancement or exculpation provisions in the organizational documents of any subsidiary of the Company in effect as of immediately prior to the effective time.

In addition, Parent will cause to be put in place and fully prepay, no later than immediately prior to the closing of the merger, “tail” directors’ and officers’ liability insurance policies with a claims reporting or discovery period of six years after the effective time, with terms and conditions providing retentions, limits and other material terms that are no less favorable than the current directors’ and officers’ liability insurance and fiduciary liability policies maintained by the Company and its subsidiaries covering matters, acts or omissions occurring at or prior to the effective time. However, Parent will not be required to pay (or cause the surviving corporation to pay) annual premiums in excess of 300% of the aggregate annual premium amounts of the applicable policies for the six years of coverage under such “tail” policies, but in such case will purchase and obtain a policy with the greatest coverage available for a cost equal to such amount.

Conditions to Consummation of the Merger

The obligations of each of the parties to the merger agreement to consummate the merger are subject to the satisfaction (or, to the extent permitted by applicable law, waiver) of the following conditions:

•        the affirmative vote of the holders of a majority of the outstanding shares of Class A common stock and Class B common stock, voting together as a single class in favor of the adoption of the merger agreement;

•        the applicable waiting period under the HSR Act having expired or been terminated;

the approvals and prior written non-disapprovals with respect to relevant U.S. insurance regulators in Colorado, Missouri and Arizona and FINRA, in each case, without the imposition of a Burdensome Condition; and

•        no judgment, temporary restraining order, preliminary or permanent injunction or other similar order, decree or ruling issued by any governmental entity having jurisdiction of any party remaining in effect, and no law being in effect that has been promulgated, enacted, issued or deemed applicable to the merger by any governmental entity having jurisdiction of any party, in each case that prohibits or makes illegal the consummation of the merger.

The obligations of Parent and Merger Sub to consummate the merger are also subject to the satisfaction (or, to the extent permitted by applicable law, waiver) of the following additional conditions:

•        the Company having performed in all material respects all obligations and complied with all covenants required to be performed or complied with by it prior to the effective time;

•        the representations and warranties of the Company with respect to (i) the Company’s corporate existence and power, (ii) the Company’s authority to execute, deliver and perform the merger agreement and consummate the transactions contemplated thereby, including the merger, (iii) the Company’s compliance with its organizational documents, (iv) ownership of outstanding capital stock of the Company’s subsidiaries, (v) finders’ and brokers’ fees, (vi) the Opinion of National Western’s Financial Advisor and (vii) anti-takeover agreements and statutes being true and correct in all material respects (in each case, without giving effect to any Company Material Adverse Effect or materiality qualifiers) at and as of the date of the merger agreement and at and as of the closing date (except to the extent any such representation or warranty expressly relates to an earlier date or period, in which case as of such date or period);

•        the representations and warranties of the Company with respect to the Company’s authorized, issued and outstanding capital stock (other than de minimis inaccuracies) being true and correct in all respects at and as of the date of the merger agreement and at and as of the closing date (except to the extent any such representation or warranty expressly relates to an earlier date or period, in which case as of such date or period);

•        the Company’s representation and warranty that, since the date of the merger agreement, no event or effect that has had, or would reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect being true and correct in all respects at and as of the date of the merger agreement and at and as of the closing date (except to the extent any such representation or warranty expressly relates to an earlier date or period, in which case as of such date or period);

•        other than the representations and warranties mentioned in the three bullets directly above, all of the Company’s other representations and warranties being true and correct (without giving effect to any Company Material Adverse Effect or materiality qualifiers) as of the date of the merger agreement and at and as of the closing date (except to the extent any such representation or warranty expressly relates to an earlier date or period, in which case as of such date or period), except where the failure of such representations and warranties to be so true and correct, individually or in the aggregate, have not had, and would not be reasonably expected to have, a Company Material Adverse Effect;

•        since the date of the merger agreement, there having not been any event, change, occurrence, or effect that, individually or in the aggregate, has had, or would reasonably be expected to have, a Company Material Adverse Effect;

•        Parent and Merger Sub having received a certificate, signed on behalf of the Company by an authorized officer, confirming that each of the conditions specified above has been satisfied;

•        the approval of the redomestication of National Western Life from Colorado to Arizona by the applicable insurance regulators and the completion of the redomestication in accordance with applicable law; and

•        no Burdensome Condition having been imposed.

The obligations of the Company to consummate the merger are also subject to the satisfaction (or, to the extent permitted by law, waiver) of the following additional conditions:

•        Parent having performed in all material respects all of its obligations required to be performed by it as of or prior to the closing date;

•        the representations and warranties of Parent and Merger Sub being true and correct (without giving effect to any Parent Material Adverse Effect or materiality qualifiers) at and as of the closing date (except to the extent any such representation or warranty expressly relates to an earlier date or period, in which case as of such date or period), except where the failure to be true and correct, individually or in the aggregate, has not, and would not be reasonably be expected to, have a Parent Material Adverse Effect; and

•        the Company having received a certificate of Parent, executed on its behalf by an authorized officer of Parent, dated as of the closing date, certifying that each of the conditions specified above has been satisfied.

Termination of the Merger Agreement

The merger agreement may be terminated prior to the effective time by the mutual written consent of the Company and Parent.

The merger agreement may be terminated by either the Company or Parent if:

•        the Company stockholder approval has not been obtained by reason of the failure to obtain the required vote at a duly held Company stockholder meeting or any adjournment or postponement thereof;

•        the closing of the merger has not yet occurred by July 8, 2024 (or, under certain circumstances described below, October 8, 2024) (as defined above, as applicable, the “outside date”) and the party seeking to terminate the merger agreement has not breached any representation or warranty or failed to fulfill any covenant or agreement under the merger agreement that has been the principal cause of, or resulted in, the failure of the closing of the merger to occur on or before the outside date; or

•        a law is adopted that permanently makes the consummation of the merger illegal or otherwise permanently prohibits the merger, or if any final and non-appealable judgment, injunction, decree or order issued by any governmental entity having jurisdiction of any party permanently enjoins or prohibits Parent or the Company from consummating the merger, provided that the party seeking to terminate the merger agreement on this basis has not breached any representation and warranty or failed to fulfill any covenant under the merger agreement, where such breach was the principal cause of, or resulted in, such legal restraint.

If (x) the closing of the merger has not occurred by July 8, 2024 by reason of the applicable waiting period under any antitrust laws not having expired or been terminated or the failure to obtain the necessary approvals and prior written non-disapprovals from the applicable governmental entities and (y) all other conditions in the merger agreement have been satisfied up to such time (other than those conditions that by their terms are to be satisfied at the closing of the merger, each of which is capable of being satisfied at the closing of the merger) or (to the extent permitted by law) waived, the outside date will be October 8, 2024.

The merger agreement may be terminated by Parent if:

•        prior to receipt of Company stockholder approval, there has been a change in recommendation, regardless of whether permitted by the merger agreement; or

•        the Company has breached any of its representations, warranties, covenants or other agreements contained in the merger agreement, which would result in a failure to satisfy certain conditions to the consummation of the merger that are dependent on the Company’s compliance with certain terms of the merger agreement, and such breach is incapable of being cured prior to the outside date, or if capable of being cured prior to the outside date, has not been cured by the earlier of (i) 30 days after the giving of written notice to the Company of such breach and (ii) three business days prior to the outside date (a “Company terminable breach”), but only if Parent or Merger Sub are not then in Parent terminable breach (as defined below) of any of their respective representations, warranties, covenants or agreements contained in the merger agreement.

The merger agreement may be terminated by the Company in the following circumstances:

•        if Parent or Merger Sub has breached any of their respective representations, warranties, covenants or other agreements contained in the merger agreement, which would result in a failure to satisfy certain conditions to the consummation of the merger that are dependent on Parent’s compliance with certain terms of the merger agreement, and such breach is incapable of being cured prior to the outside date, or if capable of being cured prior to the outside date, has not been cured by the earlier of (i) 30 days after the giving of written notice to the Company of such breach and (ii) three business days prior to the outside date (a “Parent terminable breach”), but only if the Company is not then in Company terminable breach of any of its respective representations, warranties, covenants or agreements contained in the merger agreement; or

•        prior to the receipt of Company stockholder approval, in order to enter into a definitive written agreement providing for a superior proposal if such proposal was received after the date of the merger agreement, such proposal did not result from a breach of the nonsolicit, the Company complies with the nonsolicit provisions, concurrently with, and as a condition to, any such termination the company pays or causes to be paid to Parent or its designee the Parent termination fee described below and the National Western board of directors authorized the entry into, and the Company concurrently enters into a definitive written agreement providing for a superior proposal.

Further related information is found in the section titled “The Merger Agreement — Competing Proposals” beginning on page 76.

Termination Fees and Expenses

Generally, all fees and expenses incurred in connection with the merger agreement and the transactions contemplated thereby will be paid by the party incurring those expenses, regardless of whether the merger is completed.

All filing fees paid in respect of the filings under the HSR Act in connection with the merger agreement will be borne by Parent.

The Company is required to pay Parent the termination fee if:

•        Parent terminates the merger agreement due to the occurrence of a Company terminable breach and (i) a competing proposal was announced after the date of the merger agreement but prior to the termination that was not withdrawn and (ii) within 12 months after the termination, the Company enters into a definitive agreement with respect to, or otherwise consummates, the competing proposal (or does not oppose it, in the case of a tender or exchange offer);

•        Company or Parent terminates the merger agreement because of the Company’s failure to obtain the required vote at a duly held meeting of its stockholders and (i) a competing proposal was announced after the date of the merger agreement but prior to the termination that was not withdrawn and (ii) within 12 months after the termination, the Company enters into a definitive agreement with respect to, or otherwise consummates, the competing proposal (or does not oppose it, in the case of a tender or exchange offer);

•        Parent terminates the merger agreement because prior to receipt of Company stockholder approval there has been a change in the National Western board of directors’ recommendation, regardless of whether permitted by the merger agreement; or

•        the Company terminates the merger agreement prior to the receipt of Company stockholder approval in order to enter into a definitive written agreement providing for a superior proposal received after the signing of the merger agreement that did not result from a breach of the nonsolicitation covenant binding on the Company and the Company complied with the nonsolicitation covenant’s requirements binding on the Company.

Further related information is found in the sections titled “The Merger Agreement — Competing Proposals” beginning on page 76.

Amendment and Waiver

The merger agreement may be amended or waived prior to the effective time by the parties in writing and signed, in the case of an amendment, by the Company, Parent and Merger Sub, or in the case of waiver, by the party against whom the waiver is to be effective.

Specific Performance

The parties have agreed that irreparable damage would occur in the event that any of the provisions of the merger agreement are not performed in accordance with their specific terms or otherwise are breached. Accordingly, the parties have agreed that, in addition to any other remedy available to the parties under the merger agreement, each of the parties will be entitled to injunctions, specific performance or other equitable relief, to prevent breaches of the merger agreement and to enforce specifically the terms and provisions of the merger agreement. Parent, Merger Sub and the Company have agreed in the merger agreement, however, that the Company, its subsidiaries, and their respective affiliates will not be permitted (i) to seek specific performance in respect of any person that has committed to providing financing in connection with the merger or (ii) to enforce specifically any of Merger Sub’s and its affiliates’ respective rights under the debt commitment letter or any other agreements relating to the debt financing. The Company is a third party beneficiary of the rights granted to Parent under the capital commitment letter solely for the purpose of seeking specific performance of Elliott’s obligation to fund the commitment thereunder, subject to conditions set forth in the capital commitment letter.

Governing Law

The merger agreement is governed by and construed in accordance with the laws of the state of Delaware, without giving effect to the principles of conflicts of laws thereof that might require the application of the laws of another jurisdiction.

PROPOSALS FOR THE SPECIAL MEETING

National Western Proposal 1 — Merger Agreement

For a summary and detailed information regarding this proposal, see the information about the merger agreement throughout this proxy statement, including the information set forth in section titled “The Merger Agreement” beginning on page 67. A copy of the merger agreement is attached as Annex A to this proxy statement.

Under the merger agreement, stockholder approval of this proposal is a condition to the completion of the merger. If the proposal is not approved, the merger with Parent and the transactions will not be completed even if the other proposals related to the transactions are approved.

Adoption of the merger agreement requires the affirmative vote, in person or by proxy, of the holders of a majority of the issued and outstanding shares of Class A common stock and Class B common stock, voting together as a single class. Failures to vote, broker non-votes and abstentions will have the same effect as a vote “AGAINST” the approval of such proposal.

The National Western board of directors has unanimously adopted and approved the merger agreement, has determined that the merger and the transactions contemplated thereby are in the best interests of the National Western stockholders and unanimously recommends that National Western stockholders vote “FOR” the proposal to adopt the merger agreement.

National Western Proposal 2 — Advisory (Non-Binding) Vote on Compensation

Section 14A of the Exchange Act and the applicable SEC rules thereunder, which were implemented as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, require National Western to provide its stockholders with the opportunity to vote to approve, on a non-binding, advisory basis, the compensation that may be paid or become payable to National Western’s named executive officers that is based on or otherwise relates to the proposed merger and the other transactions contemplated by the merger agreement, including the payments summarized in the “golden parachute compensation” table and the related narrative compensation disclosures regarding National Western’s named executive officers set forth in “The Merger — Interests of National Western Directors and Executive Officers in the Merger” beginning on page 54. This vote is commonly referred to as a “golden parachute say on pay” vote. Accordingly, National Western’s stockholders are being provided with the opportunity to cast an advisory vote on these change of control payments.

Because the vote is advisory, the vote on this proposal is not binding on National Western or the National Western board of directors. Furthermore, approval of this proposal is not a condition to completion of the merger.

National Western is seeking approval of the following resolution at the Special Meeting:

“RESOLVED, that National Western’s stockholders approve, on an advisory (non-binding) basis, the compensation of National Western’s named executive officers that is based on or otherwise relates to the proposed merger, as disclosed pursuant to Item 402(t) of Regulation S-K under the heading “The Merger — Interests of National Western Directors and Executive Officers in the Merger” (which disclosure includes the “golden parachute compensation” table and related narrative compensation disclosures regarding National Western’s named executive officers required pursuant to Item 402(t) of Regulation S-K).”

Approval, on an advisory (non-binding) basis, of the compensation that may be paid or become payable to National Western’s named executive officers that is based on or otherwise relates to the proposed merger requires the affirmative vote of the holders of a majority of the shares of Class A common stock and Class B common stock, voting together as a single class, present, in person or by proxy, at the Special Meeting and entitled to vote on the proposal, assuming there is a quorum at the Special Meeting. If you attend the Special Meeting or are represented by proxy and, in either case, abstain from voting, that abstention will have the same effect as voting “AGAINST” this proposal. Failures to vote and broker non-votes will have no effect on the vote for this proposal.

The National Western board of directors unanimously recommends that you vote “FOR” approval on an advisory (non-binding) basis, of the compensation that may be paid or become payable to National Western’s named executive officers that is based on or otherwise relates to the proposed merger.

National Western Proposal 3 — Possible Adjournment of the Special Meeting

If National Western fails to receive a sufficient number of votes to approve National Western Proposal 1, National Western may propose to adjourn the Special Meeting, if a quorum is present, for the purpose of soliciting additional proxies to approve National Western Proposal 1. National Western currently does not intend to propose adjournment of the Special Meeting if there are sufficient votes to approve National Western Proposal 1. The proposal to adjourn the Special Meeting, if necessary or appropriate, to solicit additional proxies requires the affirmative vote of the holders of a majority of the shares of Class A common stock and Class B common stock, voting together as a single class, present, in person or by proxy, at the Special Meeting and entitled to vote on the proposal, assuming there is a quorum at the Special Meeting. If you attend the Special Meeting or are represented by proxy and, in either case, abstain from voting, that abstention will have the same effect as voting “AGAINST” this proposal. Failures to vote and broker non-votes will have no effect on the vote for this proposal. National Western’s bylaws permit the chair of the Special Meeting to adjourn the meeting without a stockholder vote, regardless of whether a quorum is present.

The National Western board of directors unanimously recommends that you vote “FOR” the proposal to adjourn the Special Meeting, if necessary or appropriate, to solicit additional proxies.

APPRAISAL RIGHTS

The discussion of the provisions set forth below is not a complete summary regarding your appraisal rights under Delaware law and is qualified in its entirety by reference to Section 262 of the DGCL, which is attached to this proxy statement as Annex C. Stockholders intending to exercise appraisal rights should carefully review Annex C in its entirety. Failure to follow precisely any of the statutory procedures set forth in Section 262 of the DGCL in a timely manner will result in a loss of appraisal rights. This summary does not constitute any legal or other advice, nor does it constitute a recommendation that you exercise your rights to demand appraisal under Section 262 of the DGCL.

If the merger is completed and you are a stockholder of the Company and comply with the statutory procedures set forth in Section 262 of the DGCL, you may be entitled to appraisal rights under Section 262 of the DGCL. To exercise and perfect appraisal rights, a holder of shares of Company common stock must follow precisely the statutory procedures pursuant to Section 262 of the DGCL in a timely manner.

Section 262 of the DGCL is reprinted in its entirety as Annex C to this proxy statement. Set forth below is a summary description of Section 262 of the DGCL. The following is intended as a brief summary of the material provisions of statutory procedures pursuant to Section 262 of the DGCL required to be followed by a stockholder to perfect appraisal rights. This summary, however, is not a complete statement of all applicable requirements or considerations and is qualified in its entirety by reference to the full text of Section 262 of the DGCL, which appears in Annex C to this proxy statement. All references in Section 262 and this summary to “stockholder” are to the record holder of the shares of Company common stock immediately prior to the effective time as to which appraisal rights are asserted. Failure to comply strictly with the procedures set forth in Section 262 of the DGCL will result in the loss of appraisal rights. A person having a beneficial interest in shares of Company common stock held of record in the name of another person must act promptly to cause the record holder to follow the steps summarized below properly and in a timely manner to perfect appraisal rights.

Under the DGCL, holders of shares of Company common stock who follow the procedures set forth in Section 262 of the DGCL may be entitled to have their shares appraised by the Court of Chancery of the State of Delaware, or the Delaware Court of Chancery, and to receive payment in cash of the “fair value” of those shares, together with interest but exclusive of any element of value arising from the accomplishment or expectation of the merger. The “fair value” of such shares of Company common stock, as determined by the Delaware Court of Chancery may be less than, equal to or more than the consideration offered pursuant to the merger agreement.

Under Section 262 of the DGCL, the Company is required, not less than 20 days before the Special Meeting to notify each of the holders of Company common stock who are entitled to appraisal rights that appraisal rights are available for any or all of those shares, and is required to include in the required notice a copy of Section 262. This proxy statement constitutes such notice to the holders of shares of Company common stock, and Section 262 of the DGCL is attached to this proxy statement as Annex C. Any stockholder who wishes to exercise such appraisal rights or who wishes to preserve his, her or its right to do so should review the following discussion and Annex C carefully, because failure to timely and properly comply with the procedures specified will result in the loss of appraisal rights under the DGCL. In view of the complexity of Section 262 of the DGCL, any holder of Company common stock who desires to exercise his, her or its appraisal rights is encouraged to consult his, her or its legal and financial advisors.

Holders of shares of Company common stock who desire to exercise their appraisal rights must deliver to the Company a written demand for appraisal of their shares of Company common stock no later than the taking of the vote on the merger at the Special Meeting, which is scheduled to occur on January 8, 2024, at 9:00 a.m. A demand for appraisal will be sufficient if it reasonably informs the Company of the identity of the stockholder and that such stockholder intends thereby to demand appraisal of such stockholder’s shares of Company common stock. If you wish to exercise your appraisal rights, you must be the record holder of such shares of Company common stock on the date the written demand for appraisal is made and you must continue to hold such shares of Company common stock through the effective time. Accordingly, a stockholder who is the record holder of shares of Company common stock on the date the written demand for appraisal is made, but who thereafter transfers such shares prior to the effective time, will lose any right to appraisal in respect of such shares. If the party seeking appraisal rights is not the stockholder of record, the party seeking appraisal rights must follow special procedures as discussed below.

All written demands for appraisal of shares of Company common stock must be mailed or delivered to: National Western Life Group, Inc., 10801 N. Mopac Expy, Bldg. 3, Austin, Texas 78759, Attention: Chief Legal Officer. Only a holder of record of shares of Company common stock is entitled to demand an appraisal of the shares registered in that holder’s name. Accordingly, to be effective, a demand for appraisal by a stockholder of shares of Company common

stock (a) must be made by, or in the name of, the record stockholder, fully and correctly, as the stockholder’s name appears on the stockholder’s stock certificate(s) or in the transfer agent’s records, in the case of uncertificated shares, (b) should specify the stockholder’s mailing address and the number of shares registered in the stockholder’s name, and (c) must state that the person intends thereby to demand appraisal of the stockholder’s shares in connection with the merger. The demand cannot be made by the beneficial owner if he or she is not the record holder of the shares of Company common stock. The beneficial holder must, in such cases, have the registered owner, such as a bank, brokerage firm, trust or other nominee, submit the required demand in respect of those shares of Company common stock. If you hold your shares of Company common stock through a bank, brokerage firm, trust or other nominee and you wish to exercise appraisal rights, you should consult with your bank, brokerage firm, trust or the other nominee to determine the appropriate procedures for the making of a demand for appraisal by the nominee. A person having a beneficial interest in shares held of record in the name of another person, such as a broker, bank, trust or other nominee, must act promptly to cause the record holder to follow properly and in a timely manner the steps necessary to perfect appraisal rights in accordance with Section 262 of the DGCL.

If shares of Company common stock are owned of record in a fiduciary capacity, such as by a trustee, guardian or custodian, execution of a demand for appraisal should be made by the fiduciary in that capacity. If the shares of Company common stock are owned of record by more than one person, as in a joint tenancy or tenancy in common, the demand should be executed by or for all joint owners. An authorized agent, including an authorized agent for two or more joint owners, may execute the demand for appraisal for a stockholder of record; however, the agent must identify the record owner or owners and expressly disclose the fact that, in executing the demand, he or she is acting as agent for the record owner. A record owner, such as a bank, brokerage firm, trust or other nominee, who holds shares of Company common stock as a nominee for others, may exercise his or her right of appraisal with respect to the shares of Company common stock held for one or more beneficial owners, while not exercising this right for other beneficial owners. In that case, the written demand should state the number of shares of Company common stock as to which appraisal is sought. If you hold shares of Company common stock through a broker who, in turn, holds the shares through a central securities depository nominee, such as Cede & Co., a demand for appraisal of such shares of Company common stock must be made by or on behalf of the depository nominee and must identify the depository nominee as record holder. Where no number of shares of Company common stock is expressly mentioned, the demand will be presumed to cover all shares of Company common stock held in the name of the record owner.

If the notice of appraisal rights did not notify the stockholders of the effective date of the merger, then either (i) the Company must send a second notice before the effective date of the merger notifying each stockholder entitled to appraisal rights of the effective date of the merger or (ii) within ten days after the effective date of the merger, the surviving corporation in the merger must give written notice that the merger has become effective to each of the Company stockholders who is entitled to appraisal rights; provided, however, that if such second notice is sent more than 20 days following the first notice, such second notice need only be sent to each of those stockholders entitled to appraisal rights who has demanded appraisal rights in accordance with Section 262 of the DGCL and who has not withdrawn his, her or its demand for appraisal. At any time within 60 days after the effective time, any stockholder who has demanded an appraisal, but has not commenced an appraisal proceeding or joined a proceeding as a named party, may withdraw the demand and accept the consideration specified by the merger agreement for that stockholder’s shares of Company common stock by delivering to the surviving corporation a written withdrawal of the demand for appraisal. However, any such attempt to withdraw the demand made more than 60 days after the effective time will require written approval of the surviving corporation. Unless the demand is properly withdrawn by the stockholder who has not commenced an appraisal proceeding or joined that proceeding as a named party within 60 days after the effective time, no appraisal proceeding in the Delaware Court of Chancery will be dismissed as to any stockholder without the approval of the Delaware Court of Chancery, with such approval conditioned upon such terms as the Delaware Court of Chancery deems just. If the surviving corporation does not approve a request to withdraw a demand for appraisal when that approval is required, or, except with respect to any stockholder who withdraws such stockholder’s right to appraisal in accordance with the proviso in the immediately preceding sentence, if the Delaware Court of Chancery does not approve the dismissal of an appraisal proceeding, the stockholder will be entitled to receive only the appraised value of such stockholder’s shares of Company common stock as determined in any such appraisal proceeding, which value could be less than, equal to or more than the consideration offered pursuant to the merger agreement.

Within 120 days after the effective time, but not thereafter, either the surviving corporation or any stockholder who has complied with the requirements of Section 262 and is entitled to appraisal rights under Section 262 may commence an appraisal proceeding by filing a petition in the Delaware Court of Chancery demanding a determination of the fair value of the shares of Company common stock held by all stockholders entitled to appraisal. Upon the

filing of the petition by a stockholder, service of a copy of such petition will be made upon the surviving corporation. The surviving corporation has no obligation to file such a petition and has no present intention to file a petition, and holders of shares of Company common stock should not assume that the surviving corporation will file a petition.

Accordingly, it is the obligation of the holders of shares of Company common stock to initiate all necessary action to perfect their appraisal rights in respect of shares of Company common stock within the time prescribed in Section 262 of the DGCL, and the failure of a stockholder to file such a petition within the period specified in Section 262 of the DGCL could result in a loss of such stockholder’s appraisal rights. In addition, within 120 days after the effective time, any stockholder who has properly complied with the requirements of Section 262 of the DGCL will be entitled to receive from the surviving corporation, upon written request, a statement setting forth the aggregate number of shares of Company common stock not voted in favor of the merger agreement and with respect to which demands for appraisal have been received and the aggregate number of holders of such shares. The statement must be given within ten days after such written request has been received by the surviving corporation or within ten days after the expiration of the period for delivery of demands for appraisal, whichever is later. A person who is the beneficial owner of shares of Company common stock held either in a voting trust or by a nominee on behalf of such person may, in such person’s own name, file a petition for appraisal or request from the surviving corporation such statement. If a petition for appraisal is not timely filed, then the right to appraisal will cease.

If a petition for appraisal is duly filed by a stockholder and a copy of the petition is served upon the surviving corporation, then the surviving corporation will be obligated, within 20 days after receiving service of a copy of the petition, to file with the Delaware Register in Chancery a duly verified list containing the names and addresses of all stockholders who have demanded payment for their shares of Company common stock and with whom agreements as to the value of their shares of Company common stock have not been reached by the surviving corporation. After notice to stockholders who have demanded appraisal, if such notice is ordered by the Delaware Court of Chancery, the Delaware Court of Chancery is empowered to conduct a hearing upon the petition and to determine those stockholders who have complied with Section 262 of the DGCL and who have become entitled to the appraisal rights provided by Section 262 of the DGCL. The Delaware Court of Chancery may require stockholders who have demanded payment for their shares of Company common stock and who hold Company common stock represented by certificates to submit their stock certificates to the Register in Chancery for notation of the pendency of the appraisal proceedings, and if any stockholder fails to comply with that direction, the Delaware Court of Chancery may dismiss the proceedings as to that stockholder. Upon application by the surviving corporation or by any stockholder entitled to participate in the appraisal proceeding, the Delaware Court of Chancery may, in its discretion, proceed to trial upon the appraisal prior to the final determination of the stockholders entitled to an appraisal. Because the Company common stock will be listed on the NASDAQ immediately prior to the effective time, the Delaware Court of Chancery is required under Section 262 of the DGCL to dismiss the proceedings as to all holders of such shares who are otherwise entitled to appraisal rights unless (1) the total number of shares entitled to appraisal exceeds 1% of the outstanding shares of Company common stock or (2) the value of the consideration provided in the merger for such total number of shares of common stock exceeds $1 million.

After determination of the stockholders entitled to appraisal of their shares of Company common stock, the Delaware Court of Chancery will appraise the shares of the Company common stock in accordance with the rules of the Delaware Court of Chancery, including any rules specifically governing appraisal proceedings. Through such proceeding the Delaware Court of Chancery will determine the fair value of the shares of Company common stock, as of the effective time, after taking into account all relevant factors exclusive of any element of value arising from the accomplishment or expectation of the merger, together with interest, if any, to be paid upon the amount determined to be the fair value. When the fair value has been determined, the Delaware Court of Chancery will direct the payment of such value upon surrender by those stockholders of the certificates representing their shares of Company common stock. Unless the Delaware Court of Chancery in its discretion determines otherwise for good cause shown, interest from the effective time through the date of payment of the judgment will be compounded quarterly and will accrue at 5% over the Federal Reserve discount rate (including any surcharge) as established from time to time during the period between the effective time and the date of payment of the judgment. At any time before the entry of judgment in the proceedings, the surviving corporation may pay to each stockholder entitled to appraisal an amount in cash, in which case interest shall accrue thereafter only upon the sum of (1) the difference, if any, between the amount so paid and the fair value of the shares as determined by the Delaware Court of Chancery, and (2) interest theretofore accrued, unless paid at that time.

You should be aware that an investment banking opinion as to the fairness from a financial point of view of the consideration to be received in a sale transaction, such as the merger, is not an opinion as to fair value under Section 262 of the DGCL. Although we believe that the merger consideration is fair, no representation is made as

to the outcome of the appraisal of fair value as determined by the Delaware Court of Chancery, and stockholders should recognize that such an appraisal could result in a determination of a value higher or lower than, or the same as, the merger consideration. Moreover, we do not anticipate offering more than the merger consideration to any stockholder exercising appraisal rights and reserve the right to assert, in any appraisal proceeding, that, for purposes of Section 262 of the DGCL, the “fair value” of a share of Company common stock is less than the merger consideration. In determining “fair value,” the Delaware Court of Chancery is required to take into account all relevant factors. In Weinberger v. UOP, Inc., the Delaware Supreme Court discussed the factors that could be considered in determining fair value in an appraisal proceeding, stating that “proof of value by any techniques or methods that are generally considered acceptable in the financial community and otherwise admissible in court” should be considered and that “[f]air price obviously requires consideration of all relevant factors involving the value of a company.” The Delaware Supreme Court has stated that in making this determination of fair value, the Delaware Court of Chancery must consider market value, asset value, dividends, earnings prospects, the nature of the enterprise and any other facts that were known or that could be ascertained as of the date of the merger that throw any light on future prospects of the merged corporation. Section 262 of the DGCL provides that fair value is to be “exclusive of any element of value arising from the accomplishment or expectation of the merger.” In Cede & Co. v. Technicolor, Inc., the Delaware Supreme Court stated that such exclusion is a “narrow exclusion [that] does not encompass known elements of value,” but that rather applies only to the speculative elements of value arising from such accomplishment or expectation. In Weinberger, the Delaware Supreme Court also construed Section 262 of the DGCL to mean that “elements of future value, including the nature of the enterprise, which are known or susceptible of proof as of the date of the merger and not the product of speculation, may be considered.” In addition, the Delaware courts have decided that the statutory appraisal remedy, depending on factual circumstances, may or may not be a dissenting stockholder’s exclusive remedy.

Costs of the appraisal proceeding (which do not include attorneys’ fees or the fees and expenses of experts) may be determined by the Delaware Court of Chancery and imposed upon the parties participating in the appraisal proceeding by the Delaware Court of Chancery, as it deems equitable in the circumstances. Each stockholder seeking appraisal is responsible for his, her or its attorney’s and expert witness expenses; although, upon the application of a stockholder, the Delaware Court of Chancery may order all or a portion of the expenses incurred by any stockholder in connection with the appraisal proceeding, including, without limitation, reasonable attorneys’ fees and the fees and expenses of experts used in the appraisal proceeding, to be charged pro rata against the value of all shares of Company common stock entitled to appraisal. Any stockholder who demanded appraisal rights in compliance with Section 262 of the DGCL will not, after the effective time, be entitled to deliver a written consent with respect to or vote shares of Company common stock subject to that demand for any purpose or to receive payments of dividends or any other distribution with respect to those shares of Company common stock, other than with respect to payment as of a record date prior to the effective time. If no petition for appraisal is filed within 120 days after the effective time, then the right of all stockholders to appraisal will cease and the stockholders’ shares of Company common stock will be deemed to have been converted at the effective time into the right to receive the merger consideration, without interest and less any applicable withholding taxes. A stockholder will fail to perfect, or effectively lose, the right to appraisal if no petition for appraisal is filed within 120 days after the effective time. In addition, as indicated above, a stockholder may withdraw his, her or its demand for appraisal in accordance with Section 262 of the DGCL at any time within 60 days after the effective time (or thereafter with the written approval of the Company) and accept the merger consideration, without interest and less any applicable withholding taxes, offered pursuant to the merger agreement. Once a petition for appraisal has been filed with the Delaware Court of Chancery, however, the appraisal proceeding may not be dismissed as to any stockholder of the Company without the approval of the Delaware Court of Chancery, and such approval may be conditioned upon such terms as the Delaware Court of Chancery deems just. However, that restriction will not affect the right of any stockholder who has not commenced an appraisal proceeding or has not joined the appraisal proceeding as a named party to withdraw such stockholder’s demand for appraisal and to accept the merger consideration, without interest and less any applicable withholding taxes, within 60 days after the effective time. Failure to comply strictly with all of the procedures set forth in Section 262 of the DGCL will result in the loss of a stockholder’s statutory appraisal rights.

In view of the complexity of Section 262 of the DGCL, the Company stockholders who may wish to dissent to the merger and pursue appraisal rights are encouraged to consult their legal and financial advisors.

To the extent there are any inconsistencies between the foregoing summary and Section 262 of the DGCL, Section 262 of the DGCL will govern.

MARKET PRICES AND DIVIDEND DATA

Shares of Class A common stock are listed for trading on the NASDAQ under the symbol “NWLI.” The following table sets forth, for the fiscal quarters indicated, on a per-share basis, the high and low sale prices for Class A common stock for the periods indicated as reported on the NASDAQ composite transactions reporting system. The Class B common stock is held by two stockholders and is not traded on any stock exchange.

The closing sale price of the shares of Class A common stock on the NASDAQ on October 6, 2023, the last full trading day prior to the announcement of the merger, was $417.19 per share. The closing sale price of the Class A common stock on the NASDAQ on May 16, 2023 was $267.29 per share, regarded by the Company as the last unaffected closing sale price prior to the announcement of the merger agreement, in light of the Company’s public announcement on May 16, 2023 that the National Western board of directors was exploring strategic alternatives in order to maximize stockholder value. On November 29, 2023, the most recent practicable date before the date of this proxy statement, the closing price for the shares of Class A common stock on the NASDAQ was $479.94 per share.

The merger agreement permits the Company to continue to pay regular annual cash dividends not to exceed $0.36 per share of Class A common stock ($0.18 per share of Class B common stock) prior to completion of the Merger. Accordingly, on October 26, 2023, the National Western board of directors declared a cash dividend in the respective per share amounts described above, payable December 1, 2023 to stockholders of record as of November 6, 2023.

Following the merger, there will be no further market for the Class A common stock, and it will be delisted from the NASDAQ and deregistered under the Exchange Act.

National Western Stockholder Information

As of November 27, 2023, there were 3,436,020.1428 issued and outstanding shares of Class A common stock, and there were 1,834 record holders of Class A common stock. As that date, there were 200,000 issued and outstanding shares of Class B common stock, which is held of record by the Moody Revocable Trust and Three R Trust.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The information provided below sets forth certain information as of November 27, 2023, regarding (i) the ownership of voting securities of the Company by each person who is known to the management of the Company to have been the beneficial owner of more than 5% of the outstanding shares of the Class A common stock or Class B common stock; (ii) the ownership interest of each director of the Company; (iii) the ownership interest of each Named Executive Officer of the Company; and (iv) the ownership interest of executive officers and directors of the Company as a group. Insofar as is known to the Company, each such person, entity, or group has sole voting and dispositive power with respect to all such shares of Class A common stock and Class B common stock, except as otherwise noted.

For purposes of the tables below, the amounts and percentages of Class A common stock and Class B common stock beneficially owned are reported on the basis of regulations of the SEC governing the determination of beneficial ownership of securities. Under the rules of the SEC, a person is deemed to be a “beneficial owner” of a security if that person has or shares “voting power,” which includes the power to vote or to direct the voting of such security, or “dispositive power,” which includes the power to dispose of or to direct the disposition of such security. A person is also deemed to be a beneficial owner of any securities of which that person has a right to acquire beneficial ownership within 60 days, including through the exercise of options or warrants. However, the Company’s outstanding equity-based compensatory awards may be settled or exercised solely for cash, and no shares of capital stock of the Company are issuable upon the settlement or exercise of those awards. Furthermore, there are currently no outstanding stock options. Beneficial ownership also includes securities that are the subject of a voting trust, proxy, power of attorney, or other similar agreement. Under these rules, more than one person may be deemed a beneficial owner of the same securities and a person may be deemed a beneficial owner of securities as to which he has no economic interest. Except as expressly stated otherwise, the address for the beneficial owners listed below is: National Western Life Group, Inc., 10801 N. Mopac Expy, Bldg. 3, Austin, Texas 78759.

5% or More Beneficial Owners

____________

*        Indicates less than 1%.

†        Signatory to a voting and support agreement with Parent.

(1)      Prior to the November 7, 2023 death of Robert L. Moody, Sr., the Chairman Emeritus of the Company, Mr. Moody was the controlling stockholder of the Company because he held, through the Moody Revocable Trust, the voting power to elect a majority of the members of the National Western board of directors. Under the terms of the Moody Revocable Trust, the shares of Class B common stock held by the Moody Revocable Trust pass to the Three R Trust, a trust created by Robert Moody for the benefit of his children and their lineal descendants. The trustee of the Moody Revocable Trust, however, is authorized to retain trust properties, including the shares of Class B common stock, for as long as is necessary to administer the trust and Robert Moody’s estate, including the payment of debts, expenses and taxes. Therefore, upon Robert Moody’s death, Three R Trust acquired beneficial ownership of the shares of Class B common stock held by the Moody Revocable Trust. However, legal title will remain with the Moody Revocable Trust for the foreseeable future. Therefore, until the transfer of legal title to Three R Trust, Moody Bank, as trustee of the Moody Revocable Trust, retains the voting power with respect to those shares of Class B common stock. In addition to its beneficial ownership of the shares of Class B common stock held by the Moody Revocable Trust, Three R Trust directly owns 2,500 shares of Class A common stock and the remaining 1,926 shares of Class B common stock outstanding. As a result, Three R Trust has beneficial ownership of 100% of the 200,000 outstanding shares of Class B common stock. Management has been advised that Moody Bank Holding Company, Inc. (“MBHC”), which is wholly-owned by Moody Bancshares, Inc. (“Bancshares”), owns approximately 98.5% of the common stock of Moody Bank. Management has been advised further that Three R Trust owns 100% of Bancshares’ Class B Stock (which elects a majority of Bancshares’ directors) and approximately 50.3% of Bancshares’ Class A Stock. Accordingly, Three R Trust, through ownership of Bancshares, controls Moody Bank. The Trustee of Three R Trust is Irwin M. Herz, Jr., One Moody Plaza, 18th Floor, Galveston, Texas. MBHC, Bancshares, Three R Trust, and Irwin M. Herz, Jr. may have shared voting and dispositive power with respect to the shares of Class B common stock that may be beneficially owned by Moody Bank.

(2)      Ross R. Moody is the Company’s Chairman of the Board, President and Chief Executive Officer. According to a Schedule 13D filed jointly on April 9, 2020 by Ross R. Moody, Moody RRM Interests Ltd. (the “RRM Partnership”), and Moody RRM Management Company LLC (“RRM Management”), the RRM Partnership acquired 289,474 shares of Class A common stock of the Company from the Moody Revocable Trust on March 30, 2020. Such Schedule 13D reports that RRM Management is general partner of the RRM Partnership and that Ross R. Moody is manager of RRM Management. Such Schedule 13D further reports that the RRM Partnership, RRM Management, and Ross R. Moody have shared voting and dispositive power with respect to 289,474 shares of Class A common stock and that Ross R. Moody disclaims beneficial ownership of such shares. A Statement of Changes in Beneficial Ownership on Form 4 filed by Ross R. Moody with the SEC on May 17, 2022 reports that Ross R. Moody directly owns 9,000 shares of Class A common stock. Ross Moody is deemed to have sole voting and dispositive power with respect to such directly-owned shares. The principal address of the RRM Partnership and RRM management is as shown in the table above for Ross Moody.

(3)      According to a Schedule 13G filed jointly on February 14, 2023 by Robert L. Moody, Jr., Moody RLM Jr. Interests Ltd. (the “RLM Jr. Partnership”), and Moody RLM Jr. Management Company LLC (“RLM Jr. Management”) the RLM Jr. Partnership and RLM Jr. Management have shared voting and dispositive power with respect to 289,474 shares of Class A common stock and that Robert L. Moody, Jr. has shared voting and dispositive power with respect to 298,390 shares of Class A common stock. The principal address of the RLM Jr. Partnership and RLM Jr. Management is as shown in the table above for Robert L. Moody, Jr.

(4)      Frances A. Moody-Dahlberg is a director of the Company. According to a Schedule 13D filed jointly on April 9, 2020 by Ms. Moody-Dahlberg, Moody FAMD Interests Ltd. (the “FAMD Partnership”), and Moody FAMD Management Company LLC (“FAMD Management”), the FAMD Partnership acquired 289,474 shares of Class A common stock of the Company from the Moody Revocable Trust on March 30, 2020. Such Schedule 13D reports that FAMD Management is general partner of the FAMD Partnership and that Ms. Moody-Dahlberg is manager of FAMD Management. Such Schedule 13D further reports that the FAMD Partnership, FAMD Management, and Ms. Moody-Dahlberg have shared voting and dispositive power with respect to 289,474 shares of Class A common stock and that Ms. Moody-Dahlberg disclaims beneficial ownership of such shares. Such Schedule 13D further reports that Ms. Moody-Dahlberg has sole voting and dispositive power with respect to 1,850 shares of Class A common stock. The principal address of the FAMD Partnership and FAMD Management is as shown in the table above for Ms. Moody-Dahlberg.

(5)      Russell S. Moody is an advisory director of the Company. According to an amended Schedule 13D filed jointly on April 7, 2020 by Russell S. Moody, Moody RSM Interests Ltd. (the “RSM Partnership”), Moody RSM Management Company LLC (“RSM Management”), Moody Bank, MBHC, Bancshares, Three R Trust, and Irwin M. Herz, Jr., the RSM Partnership acquired 289,474 shares of Class A common stock of the Company from the Moody Revocable Trust on March 30, 2020. Such amended Schedule 13D reports that RSM Management is general partner of the RSM Partnership, that Russell S. Moody and Moody Bank are co-managers of RSM Management, and that Moody Bank is attorney-in-fact for Russell S. Moody pursuant to a Power of Attorney previously executed by him. Such amended Schedule 13D further reports that the RSM Partnership and RSM Management have shared voting and dispositive power with respect to 289,474 shares of Class A common stock; Russell S. Moody has shared voting and dispositive power with respect to 291,324 shares of Class A common stock (including the 289,474 shares owned by the RSM Partnership) and disclaims beneficial ownership of 289,474 of such shares; Moody Bank, MBHC and Bancshares have shared voting and dispositive power with respect to 291,325 shares of Class A common stock (including the 291,324 shares collectively owned by the RSM Partnership and by Russell S. Moody) and disclaim beneficial ownership of all of such shares; Three R Trust and Irwin M. Herz, Jr. have shared voting and dispositive power with respect to 293,825 shares of Class A common stock (including the 291,324 shares collectively owned by the RSM Partnership and by Russell S. Moody) and disclaim beneficial ownership of 291,325 of such shares; and Irwin M. Herz, Jr. has sole voting and dispositive power with respect to 2,000 shares of Class A common stock and disclaims beneficial ownership of 2,500 shares beneficially owned by Three R Trust. The principal address of the RSM Partnership, RSM Management, Moody Bank, MBHC, and Bancshares is 2302 Postoffice Street, Galveston, Texas 77550. The principal address of Three R Trust is 2302 Postoffice Street, Suite 702, Galveston, Texas 77550, and the principal address of Irwin M. Herz, Jr. is One Moody Plaza, 18th Floor, Galveston, Texas 77550.

(6)      In a Schedule 13G filed by Continental General Insurance Company, Continental Insurance Group, Ltd., Continental General Holdings LLC, Percy Rockdale LLC and Michael Gorzynski on August 18, 2023, the reporting persons reported beneficially owning collectively a total of 253,019 shares of Class A common stock. The Schedule 13G stated that Percy Rockdale LLC directly beneficially owned 9,000 shares of Class A common stock and Continental General Insurance Company directly beneficially owned 244,019 shares of Class A common stock. The report further stated that Continental General Holdings LLC is the sole owner of Continental Insurance Group, Ltd., which is in turn the sole owner of Continental General Insurance Company, and that each of these two holding companies may be deemed to beneficially own the 244,019 shares of Class A common stock directly beneficially owned by Continental General Insurance Company. The Schedule 13G also disclosed that Mr. Gorzynski is a manager of Continental General Holdings LLC and therefore may be deemed to beneficially own the 244,019 shares of Class A common stock directly beneficially owned by Continental General Insurance Company. Furthermore, the Schedule 13G disclosed that Mr. Gorzynski is the sole manager of Percy Rockdale LLC and therefore may be deemed to beneficially own the 9,000 shares of Class A common stock directly beneficially owned by Percy Rockdale LLC. The Schedule 13G stated that it was filed in accordance with Rule 13d-1(c) under the Exchange Act, which is available to reporting persons that disclose their acquisitions on Schedule 13G within 10 days and have not acquired the securities with any purpose, or with the effect, of changing or influencing the control of the Company. The Schedule 13G reports that the address for Mr. Gorzynski and Percy Rockdale LLC is 595 Madison Avenue, 30th Floor, New York, NY 10022. It further reports that the address for Continental General Insurance Company, Continental Insurance Group, Ltd., and Continental General Holdings LLC is 11001 Lakeline Blvd., Ste. 120, Austin, TX 78717. In a Form A filing made by Continental General Insurance Company with the Missouri Department of Insurance on September 29, 2023 (prior to the Company’s public announcement that it had entered into the Merger Agreement), Continental General Insurance Company disclosed that Continental General Insurance Company had acquired direct ownership of an additional 26,387 shares of Class A common stock. As a result, as of the date of that Form A, the reporting persons under the Schedule 13G collectively owned 288,406 shares of Class A common stock: 279,406 shares directly owned by Continental General Insurance Company and 9,000 shares directly owned by Percy Rockdale LLC.

(7)      In a Schedule 13G/A filed by Dimensional Fund Advisors LP (“Dimensional”) on February 10, 2023, Dimensional reported beneficially owning 226,881 shares of Class A common stock, with sole voting power with respect to 222,446 shares of Class A common stock and sole dispositive power with respect to 226,881 shares of Class A common stock. According to such Schedule 13G/A, Dimensional is an investment adviser registered under the Investment Advisors Act of 1940, and

the shares reported as beneficially owned by Dimensional are held by various investment companies registered under the Investment Company Act of 1940. The Schedule 13G/A also reported that Dimensional serves as investment manager or sub-adviser to certain other commingled funds, group trusts and separate accounts (such investment companies, trusts and accounts, collectively referred to as the “Funds”) and that, in certain cases, subsidiaries of Dimensional may act as an adviser or sub-adviser to certain Funds. The Schedule 13G/A further stated that all of the shares of Class A common stock included in the Schedule 13G/A were owned by the Funds and that Dimensional disclaimed beneficial ownership of all such shares.

(8)      In a Schedule 13G/A filed by The Vanguard Group (“Vanguard”) on February 9, 2023, Vanguard reported beneficially owning 191,603 shares of Class A common stock, with shared voting power with respect to 1,702 shares of Class A common stock, sole dispositive power with respect to 187,693 shares of Class A common stock, and shared dispositive power with respect to 3,910 shares of Class A common stock. According to such Schedule 13G/A, Vanguard is an investment adviser registered under the Investment Advisors Act of 1940.

(9)      In a Schedule 13G/A filed by BlackRock, Inc. on February 1, 2023, BlackRock, Inc. reported beneficially owning 177,828 shares of Class A common stock, with sole voting power with respect to 172,667 shares of Class A common stock and sole dispositive power with respect to 177,828 shares of Class A common stock. According to such Schedule 13G/A, BlackRock, Inc. is a parent holding company in accordance with Rule 13d-1(b)(1)(ii)(G) under the Exchange Act.

Directors and Executive Officers

____________

*        Indicates less than 1%.

(1)      Except under applicable community property laws or as otherwise indicated in the footnotes to the table below, the persons named in the table have sole voting and investment power with respect to all shares of Common Stock beneficially owned. The address of all directors and Named Executive Officers in this table is c/o National Western Life Group, Inc., 10801 N. Mopac Expy, Bldg. 3, Austin, TX 78759.

FUTURE STOCKHOLDER PROPOSALS

It is not expected that National Western will hold an annual meeting for 2024 unless the merger is not completed. If the merger is not completed, National Western’s stockholders will continue to be entitled to attend and participate in National Western stockholder meetings.

Pursuant to Rule 14a-8 under the Exchange Act, stockholders may present proper proposals for inclusion in National Western’s proxy statement and form of proxy and for consideration at National Western’s next annual meeting of stockholders. In order for a stockholder proposal to be eligible for inclusion in the proxy statement and form of proxy for next year’s annual meeting pursuant to Rule 14a-8(e) of the Exchange Act, the proposal must be received by the Secretary of National Western at 10801 N. Mopac Expy Bldg. 3, Austin, Texas 78759 not later than January 6, 2024, the date that is at least 120 days prior to May 5, 2024 (the anniversary of the date the proxy statement for National Western’s 2023 annual meeting was first made available to stockholders). Those proposals must meet all of the requirements of applicable Delaware law and the rules and regulations promulgated by the SEC (including the requirements of Rule 14a-8) to be eligible for inclusion in the Company’s 2024 proxy materials. While the National Western board of directors will consider stockholder proposals, National Western reserves the right to omit from National Western’s proxy statement and form of proxy stockholder proposals that National Western is not required to include under the Exchange Act, including Rule 14a-8.

Stockholder proposals, including stockholder director nominations, submitted for consideration at the 2024 annual meeting of stockholders but not submitted for inclusion in National Western’s proxy statement for the 2024 annual meeting pursuant to Rule 14a-8 generally must be delivered to National Western’s Secretary no later than 90 days nor earlier than 120 days before June 22, 2024, the first anniversary of the 2023 annual meeting. Accordingly, any such proposal must be received no earlier than February 23, 2024, and no later than March 24, 2024. However, if the date of the 2024 annual meeting is more than 30 days before or more than 70 days after June 22, 2024, notice by the stockholder must be so delivered not earlier than the close of business on the 120th day prior to the 2024 annual meeting and not later than the close of business on the later of the 90th day prior to the 2024 annual meeting or the tenth day following the day on which public announcement of the date of that meeting is first made by the Company.

In addition to the timely notice requirements, a National Western stockholder’s proposal for nominees for directors must comply with Section 2.13 of National Western’s Second Amended and Restated Bylaws, as further amended and supplemented from time to time (the “National Western bylaws”). Stockholder proposals related to other business must also comply with Section 2.13 of the National Western bylaws. Furthermore, any stockholder proposal must comply with all applicable requirements of the Exchange Act and the rules and regulations thereunder.

Stockholders may contact the Secretary at our principal executive office located at 10801 N. Mopac Expy, Bldg. 3, Austin, Texas 78759 for a copy of the requirements for making stockholder proposals.

OTHER MATTERS PRESENTED AT THE MEETING

As of the date of this proxy statement, the National Western board of directors does not know of any matters that will be presented for consideration at the Special Meeting, other than as described in this proxy statement. If any other matters come before the Special Meeting or any adjournment or postponement thereof and shall be voted upon, the proposed proxy will be deemed to confer authority to the individuals named as authorized therein to vote the shares represented by the proxy as to any matters that fall within the purposes set forth in the notice of special meeting. It is intended that the persons named in the enclosed proxy and acting thereunder will vote in accordance with their best judgment on such matters.

WHERE YOU CAN FIND MORE INFORMATION

National Western files annual, quarterly and current reports, proxy statements and other information with the SEC under the Exchange Act. You may read and copy any of this information at the SEC’s Public Reference Room at 100 F Street, N.E., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the Public Reference Room. The SEC also maintains an internet website that contains reports, proxy and information statements, and other information regarding issuers, including National Western, who file electronically with the SEC. The address of that site is www.sec.gov.

Investors may also consult National Western’s website for more information about National Western. Information included on National Western’s website is not incorporated by reference into this proxy statement.

In addition, the SEC allows National Western to disclose important information to you by referring you to other documents filed separately with the SEC. This information is considered to be a part of this proxy statement.

This proxy statement also incorporates by reference, and is accompanied by, the documents listed below that National Western has previously filed with the SEC (other than information furnished pursuant to Item 2.02 or Item 7.01 of a Current Report on Form 8-K). These documents contain important information about National Western, its financial condition or other matters.

•        Annual Report on Form 10-K for the year ended December 31, 2022.

•        Quarterly Report on Form 10-Q for the quarter ended September 30, 2023.

•        Proxy Statement on Schedule 14A, filed on April 28, 2023.

•        Current Reports on Form 8-K, filed on March 10, 2023; May 15, 2023; May 16, 2023; June 27, 2023; June 29, 2023; August 8, 2023; October 10, 2023; October 26, 2023; and November 8, 2023.

In addition, National Western incorporates by reference any future filings it makes with the SEC under Section 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this proxy statement and prior to the date of the Special Meeting (other than information furnished pursuant to Item 2.02 or Item 7.01 of any Current Report on Form 8-K, unless expressly stated otherwise therein). Such documents are considered to be a part of this proxy statement, effective as of the date such documents are filed.

You can obtain any of these documents from the SEC, through the SEC’s website at the address described above, or National Western will provide you with copies of these documents, without charge, upon written or oral request to:

National Western Life Group, Inc.
10801 N. Mopac Expy, Bldg. 3
Austin, Texas 78759
(512) 836-1010

In the event of conflicting information in this proxy statement in comparison to any document incorporated by reference into this proxy statement, or among documents incorporated by reference, the information in the latest filed document controls.

You should rely only on the information contained or incorporated by reference into this proxy statement. No one has been authorized to provide you with information that is different from that contained in, or incorporated by reference into, this proxy statement. This proxy statement is dated November 30, 2023. You should not assume that the information contained in this proxy statement is accurate as of any date other than that date. You should not assume that the information incorporated by reference into this proxy statement is accurate as of any date other than the date of such incorporated document. Our mailing of this proxy statement to National Western stockholders will not create any implication to the contrary.

Annex A

Execution Version

AGREEMENT AND PLAN OF MERGER

dated as of

October 8, 2023

by and among

S. USA LIFE INSURANCE COMPANY, INC.,

PGH MERGER INC.

and

NATIONAL WESTERN LIFE GROUP, INC.

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