EFTA00607796.pdf

an SUBJECT TO COMPLETION PRELIMINARY PROSPECTUS SUPPLEMENT DATED MARCH 24, 2015 • PROSPECTUS SUPPLEMENT (To Prospectus datedMarch 23, 2015) ea Depositary Shares National General >> ry Holdings Corp. Depositary Shares, Each Representing 1 /40th of a Share of % Non-Cumulative Preferred Stock, Series B u''.. env offering depositary shares. each of which represents a 11‘10,4 interest in a share of our tc Non-Cumulative Preferred Stork. Series B. $0.01 par value per share. $1,000 liquidation preference per share (equivalent to $25 per depositary share) (the • "Series B Preferred Stork"). The depositary shares nee evidenced by depository receipts. Each depositary share entitles the holder. o through the depositary, to a proportional fractional interest in all rights and preferences of the Series B Preferred Stock represented ne thereby (including any dividend. liquidation. redemption and voting rights). •to w Dividends on the Series B Preferred Stork represented by the depositary shares when, as and if declared by our Brant of Directors or g 'E a duly authorized committee of the Board will ore me and be payable on the liquidation preference amount. on a non-cumulative E d) basis. quarterly in arrears on the 15g day of January. April. July and October of each year (each, a "diridend payment date"). commencing on July 15. 2015. at an annual rate of ch. Distributions trill be made in respect of the depositary shares if and to the a- extent dividends are paid on the Series B Preferred Stork. • co Dividends on the Series B Preferred Stock are not ...initially.% Accordingly, in the event dividends are not declared on the Series B Preferred Stock for payment on any dividend payment date, then those dividends will not accumulate I trill not be payable. If we -6 Irv, hare not declared a dividend before the diridend payment date for any dividend period. we trill hare no obligation to pay dividends for 8 W)G4 that diridend period. whether or not dividends on the Series B Preferred Stock are declared for any future dividend period. •- = 44 So long as any Series B Preferred Stock remains outstanding, no diridend shall be paid or declared on our common stock or any of • `B ry our other securities ranking j tttt itt r to the Series B Preferred Stock (other than a dividend payable solely in common stock or in such ▪= other junior securities), unless the full dividends for the latest completed dividend period on all outstanding Series B Preferred Stock to 4) and any parity stock hare been declared and paid or provided for. E w The Series B Preferred Stock is not redeemable prior to April 15. 2020. On and after that date, the Series B Preferred Stock will be e a redeemable at oar option. fur cash, in whole or in part. at a redemption price of $1,000 per share of Series B Preferred Stock 0) o (equivalent to $23 per depositary share), plus any declared and unpaid dividends on the shares of Series B Preferred Stock collet for redemption for I dividend periods. if any, plus accrued but unpaid dividends (whether or not declared) thereon for the then- E -c• current dividend period. to. but excluding. the date of redemption. without accumulation of any other lectured dividends. See "Description of the Series B Preferred Stock—Redemption — in this prospectus supplement. The depositary shares representing the = Series B Preferred Stock will be redeemed if and to the extent the related shares of Series B Preferred Stork are redeemed by us. Neither the depositary shares nor the Series B Preferred Stork represented thereby hare a stated maturity, nor will they be subject to to co " = any sinking fund or mandatory redemption. The Series B Preferred Stock will not hare voting rights, except as set forth under "Description of the Series B Preferred Stock—Voting Rights" in this prospectus supplement. A holder of depositary shares representing r, fractional Tests in the Series B Preferred Stuck will be entitled to direct the depositary how to vote in such circumstances. See to E "Description of the Depository Shores—Voting Bights- in this prospectus supplement. o = CL There is currently no public market for the depositary shares or the Series B Preftwed Stock represented thereby. We intend to apply en 0, to list the depositary shares on the NASDAQ Global Market under the symbol "NGOCO. - if the application is approved. we expect c to commence within .30 days following the initial issuance of the depositary shares. to E = Investing vesting in the depositary shares and the Series B Preferred Stock represented thereby intsolves risks. See .C1 243 o "Risk Factors" beginning on page 5-13 of this prospectus supplement and on page 2 of the accompanying prospectus, as well as the risks described in the documents incorporated by reference in Ibis prospectus ▪ supplement and the accompanying prospectus, to read about important factors you should consider before ssi making a decision to invest in the depositary shares. The depositary shares are not expected to be rated and = eh ry .= ntay be subject to the risks associated with non-investment grade securities. ai .2 Eo Per Share Total 0) (o) a a. ,G ..• Publicoffering price (11 $ $ =a Underwriting discounts and commissions $ $ 0 GI .... = co Proceeds, before expenses, toNational General Holdings Corp. $ $ n2 (1) Assumes nosy...smite of the underwriters' over-allotment option described below. e c4 We have granted the underwriters an option to purchase up to an additional 0) depositary shares within 30 days after the date of this prospectus supplement at the public offering price, less the underwriting discount, solely to cover over- t allotments, irony. = a =" " Neither the Securities and Exchange Commission, any state securities commission or any other regulatory body has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus supplement or the accompanying. ) to a.▪ = prospectus. Any representation to the contrary is a criminal. offense. The underwriters expect to deliver the depositary shares in book-entry form only through the facilities of The Depository Trust • Company and its participants, including Euroclear Rank as operator of the Euroclear System, and Clearstream .5 a Banking, nano anon yme, on or about , 2015. o w CO 0 Joint Book-Running Managers E= as Morgan Stanley UBS Investment Bank Keefe, Bruyette & Woods A &Mel Company •I— ILco' The dale of this prospectus supplement is , 2015, EFTA00607796  You should rely only on the information contained or incorporated by reference in this prospectus supplement, the accompanying prospectus and in any free writing prospectus filed by us with the Securities and Exchange Commission, or the SEC, for use in connection with this offering. We have not, and the underwriters have not, authorized anyone to provide you with different or additional information and, accordingly, you should not rely on any such information if it is provided to you. We are not, and the underwriters are not, making an offer to sell, or the solicitation of an offer to buy, any of these securities in any jurisdiction where such an offer or sale is not permitted. You should not assume that the information contained or incorporated by reference in this prospectus supplement, the accompanying prospectus or any such free writing prospectus is accurate as of any date other than the respective dates of the related documents or the incorporated documents, as the case may be. References in this prospectus supplement and the accompanying prospectus to "we," "us," "our," "the Company" or "NGHC" or other similar terms refer to National General Holdings Corp. and its consolidated subsidiaries, unless we state otherwise or the context indicates otherwise. Additionally, in this prospectus supplement and the accompanying prospectus, unless otherwise stated or the context otherwise requires, references to "dollars" or "$" are to the lawful currency of the United States. EFTA00607797  TABLE OF CONTENTS Prospectus Supplement ABOUT THIS PROSPECTUS DESCRIPTION OF THE SERIES B SUPPLEMENT S-1 PREFERRED STOCK S-23 SUMMARY DESCRIPTION OF THE DEPOSITARY CORPORATE AND OTHER SHARES S-31 INFORMATION S-3 CERTAIN U.S. FEDERAL INCOME TAX THE OFFERING S-4 CONSIDERATIONS S-36 SUMMARY HISTORICAL FINANCIAL CERTAIN ERISA CONSIDERATIONS S-41 DATA S-10 UNDERWRITING S-42 RISK FACTORS S-13 WHERE YOU CAN FIND MORE USE OF PROCEEDS S-20 INFORMATION; INCORPORATION BY RATIO OF EARNINGS TO FIXED REFERENCE S-47 CHARGES AND PREFERRED STOCK LEGAL MATTERS S-48 DIVIDENDS S-21 EXPERTS S-48 CAPITALIZATION S-22 Prospectus ABOUT THIS PROSPECTUS DESCRIPTION OF DEBT SECURITIES 9 RISK FACTORS 2 DESCRIPTION OF COMMON STOCK 20 SPECIAL NOTE REGARDING FORWARD- DESCRIPTION OF PREFERRED STOCK 24 LOOKING STATEMENTS 3 DESCRIPTION OF DEPOSITARY WHERE YOU CAN FIND MORE SHARES 26 INFORMATION 5 DESCRIPTION OF WARRANTS 29 INCORPORATION OF CERTAIN DESCRIPTION OF UNITS 30 INFORMATION BY REFERENCE 6 PLAN OF DISTRIBUTION 31 NATIONAL GENERAL HOLDINGS CORP. 7 LEGAL MATTERS 33 USE OF PROCEEDS 8 EXPERTS 33 RATIO OF EARNINGS TO FIXED CHARGES AND PREFERRED STOCK DIVIDENDS . . . 8 S-i EFTA00607798  ABOUT THIS PROSPECTUS SUPPLEMENT This prospectus supplement is a supplement to the accompanying prospectus that is also a part of this document. The accompanying prospectus is part of a registration statement that we filed with the SEC using a shelf registration process. Under the shelf registration process. from time to time, we may offer debt securities. common stock, preferred stock, depositary shares, warrants and units. In the accompanying prospectus. we provide you with a general description of the securities we may offer from time to time under this shelf registration statement. In this prospectus supplement. we provide you with specific information about the depositary shares that we are selling in this offering and the Series B Preferred Stock represented thereby. Both this prospectus supplement and the accompanying prospectus include, or incorporate by reference, important information about us, the securities being offered and other information you should know before making a decision to invest in the depositary shares. This prospectus supplement also adds to. updates and changes information contained or incorporated by reference in the accompanying prospectus. If any specific information regarding the depositary shares or the Series B Preferred Stock represented thereby in this prospectus supplement is inconsistent with the more general description of the securities in the accompanying prospectus, you should rely on the information contained in this prospectus supplement. You should read this prospectus supplement, the accompanying prospectus and any free writing prospectus we file with the SEC in connection with this offering, as well as the additional information described under "Where You Can Find More Information; Incorporation by Reference" in this prospectus supplement, before making a decision to invest in the depositary shares. In particular, you should review the information under the heading "Risk Factors" included in ow Annual Report on Form l0•K for the year ended December 31, 2014, which is incorporated by reference herein. S- I EFTA00607799  SUMMARY The information below is only a summary ofmore detailed information included elsewhere or incorporated by reference in this prospectus supplement and the accompanying prospectus. This summary does not contain all the information that you should consider before making a decision to invest in the securities in this offering. The other information is important, so please read this entire prospectus supplement and the accompanying prospectus, as well as the information incorporated by reference herein, carefilly. You should pay special attention to the "Risk Factors" section beginning on page S-B of this prospectus supplement. In particular, you should review the information under the heading "Risk Factors" in this prospectus supplement, the accompanying prospectus and included in our Annual Report on Form 10-K for the year ended December 31, 2014. OUR COMPANY Overview We are a specialty personal lines insurance holding company. Through our subsidiaries, we provide a variety of insurance products, including personal and commercial automobile, supplemental health, homeowners and umbrella and other niche insurance products. We sell insurance products with a focus on underwriting profitability through a combination of our customized and predictive analytics and our technology driven low cost infrastructure. Our automobile insurance products protect our customers against losses due to physical damage to their motor vehicles, bodily injury and liability to others for personal injury or property damage arising out of auto accidents. Our homeowners and umbrella insurance products protect our customers against losses to dwellings and contents from a variety of perils, as well as coverage for personal liability. We offer our property and casualty ("P&C") insurance products through a network of approximately 19,000 independent agents, a number of affinity partners and through direct-response marketing programs. We have approximately one and a half million P&C policyholders. We launched our accident and health ("A&H") business in 2012 to provide accident and non-major medical health insurance products targeting our existing P&C policyholders and the anticipated emerging market of employed persons who are uninsured or underinsured. We market our and other carriers' A&H insurance products through a multi-pronged distribution platform that includes a network of over 4,300 independent agents. direct-to-consumer marketing, wholesaling and worksite marketing. We are licensed to operate in 50 states and the District of Columbia, but focus on underserved niche markets. Approximately 84% of our P&C premium written is originated in eleven core states: North Carolina, New York, California, Florida, New Jersey, Louisiana, Massachusetts, Connecticut, Texas, Virginia and Michigan. For the years ended December 31, 2014, 2013 and 2012, ow gross premium written was $2,135 million, $1,339 million and $1,352 million, net premium written was $1,870 million, $679 million and $632 million and total consolidated revenues were $1,862 million, $932 million and $808 million, respectively. Our company (formerly known as American Capital Acquisition Corporation) was formed in 2009 to acquire the private passenger auto business of the U.S. consumer property and casualty insurance segment of General Motors Acceptance Corporation (now known as Ally Financial), which operations date back to 1939. We acquired this business on March 1, 2010. Our wholly owned subsidiaries include fifteen regulated domestic insurance companies, of which fourteen write primarily P&C insurance and one writes solely A&H insurance. Our insurance subsidiaries have been assigned an "A-" (Excellent) group rating by A.M. Best Company, Inc. S-2 EFTA00607800 Business Segments We are a specialty national carrier with regional focuses. We manage our business through two segments: Property and Casualty ("P&C")—Our P&C segment operates its business through two primary distribution channels: agency and affinity. Our agency channel focuses primarily on writing standard, preferred and nonstandard auto coverage and homeowners and umbrella coverage through our network of over 19,000 independent agents. In our affinity channel, we partner with a number of affinity groups and membership organizations to deliver insurance products tailored to the needs of our affinity partners' members or customers under ow affinity partners' brand name or label, which we refer to as selling on a "white label" basis. A primary focus of a number of our affinity relationships is providing recreational vehicle coverage, of which we believe we are one of the top writers in the U.S. Accident and Health ("A&H")—Our A&H segment was formed in 2012 to provide accident and non• major medical health insurance products targeting our existing insureds and the anticipated emerging market of uninsured or underinsured employees. Through a number of recent acquisitions of both carriers and general agencies, including Velapoint, LLC, our call center general agency, and National Health Insurance Company, a life and health insurance carrier established in 1979, and Euro Accident Health & Care Insurance Aktiebolag ("EuroAccident"), our European group life and health insurance managing general agent, we have assembled a multi•pronged distribution platform that includes direct- to-consumer marketing through our call center agency, selling through independent agents, wholesaling insurance products through large general agencies/program managers and, through our affinity relationships, worksite marketing through employers. Additional financial information regarding our segments and additional information regarding the products we sell and the distribution channels through which we sell them is presented in our Annual Report on Form 10•K for the year ended December 31, 2014, which is incorporated by reference herein. See "Where You Can Find More Information; Incorporation by Reference" in this prospectus supplement. CORPORATE AND OTHER INFORMATION Our principal executive offices are located at 59 Maiden Lane, 38th Floor, New York, New York 10038. and our telephone number at that location is Our website address is http://www.nationalgeneral.com. Our internet website and the information contained therein or connected thereto are not intended to be incorporated by reference into this prospectus supplement and the accompanying prospectus. This prospectus supplement refers to brand names, trademarks, service marks and trade names of us and other companies and organizations, and these brand names, trademarks, service marks and trade names are the property of their respective holders. S•3 EFTA00607801  THE OFFERING The following is a brief summary of certain terms of this offering. For a more complete description of the terms of the Series B Preferred Stock and the depositary shares representing the Series B Preferred Stock, see "Description of the Series B Preferred Stock" and "Description of the Depositary Shares" in this prospectus supplement and "Description of Preferred Stock" and "Description ofDepositary Shares" in the accompanying prospectus. Issuer National General Holdings Corp. ("NGHC") Securities offered depositary shares (or depositary shares if the underwriters exercise their over- allotment option in full), each representing a I/40'h interest in a share of % Non-Cumulative Preferred Stock. Series B (the "Series B Preferred Stock"), S0.01 par value per share, with a liquidation preference of $1.000 per share (equivalent to $25 per depositary share), of NGHC. Each holder of a depositary share will be entitled, through the depositary. in proportion to the applicable fraction of a share of the Series B Preferred Stock represented by such depositary share, to all the rights and preferences of the Series B Preferred Stock represented thereby (including dividend, voting, redemption and liquidation rights). We may from time to time elect to issue additional depositary shares representing Series B Preferred Stock, and all the additional depositary shares would be deemed to form a single series with the depositary shares offered hereby. Dividends Dividends on the Series B Preferred Stock, when, as and if declared by the Board of Directors of NGHC or a duly authorized committee of the Board, will accrue and be payable on the liquidation preference amount . on a non-cumulative basis, quarterly in arrears on each dividend payment date, at an annual rate of . Dividends on the Series B Preferred Stock will accrue from the original issue date or the most recent dividend payment date. Dividends on the Series B Preferred Stock will be computed on the basis of a 360•day year consisting of twelve 30•day months. Any dividends declared or payable on the Series B Preferred Stock will be distributed to holders of depositary shares in the manner described under "Description of the Depositary Shares—Dividends and Other Distributions" in this prospectus supplement. 5.4 EFTA00607802  Dividends on the Series B Preferred Stock are not cumulative. Accordingly, in the event dividends arc not declared on the Series B Preferred Stock for payment on any dividend payment date, then such dividends will not accumulate and will not be payable. If our Board of Directors or a duly authorized committee of the Board has not declared a dividend before the dividend payment date for any dividend period, we will have no obligation to pay dividends for such dividend period after the dividend payment date for that dividend period, whether or not dividends on the Series B Preferred Stock are declared for any future dividend period. During any dividend period, so long as any Series B Preferred Stock remains outstanding, unless the full dividends for the latest completed dividend period on all outstanding shares of Series B Preferred Stock have been declared and paid: • no dividend shall be paid or declared on our common stock or other junior stock, other than a dividend payable solely in junior stock; • no common stock or other junior stock shall be purchased, redeemed or otherwise acquired for consideration by us, directly or indirectly (other than (1) as a result of a reclassification of junior stock for or into other junior stock, or the exchange or conversion of one share of junior stock for or into another share of junior stock, (2) through the use of the proceeds of a substantially contemporaneous sale of junior stock or (3) in connection with grants or settlements of grants (including any "cashless exercise" or "net share settlement") pursuant to any equity compensation plan adopted by us) nor shall any monies be paid to or made available for a sinking fund for the redemption of such stock; and • no shares of Series B Preferred Stock or parity stock shall be repurchased, redeemed or otherwise acquired for consideration by us other than pursuant to pro rata offers to purchase all, or a pro rata portion, of the Series B Preferred Stock and such parity stock except by conversion into or exchange for junior stock. For any dividend period in which dividends are not paid in full upon the Series B Preferred Stock and any parity stock, all dividends declared for such dividend period with respect to the Series B Preferred Stock and such parity stock shall be declared on a pro rata basis based on the liquidation preference thereof. See S•5 EFTA00607803  "Description of the Series B Preferred Stock— Dividends" and "Description of the Depositary Shares—Dividends and Other Distributions" in this prospectus supplement. Dividend Payment Dates To the extent declared, dividends on the Series B Preferred Stock will be payable on the 15th day of January. April, July and October of each year. commencing on July 15, 2015. If any date on which dividends would otherwise be payable is not a business day, then the dividend payment date will be the next succeeding business day with the same force and effect as if made on the original dividend payment date. Dividend Periods A dividend period is the period from and including a dividend payment date to but excluding the next dividend payment date, except that the initial dividend period will commence on and include the original issue date of the Series B Preferred Stock and will end on and exclude the July 15, 2015 dividend payment date. Assuming an initial issue date of . 2015. the dividend for the initial dividend period will be approximately $ per share of Series B Preferred Stock (equivalent to $ per depositary share). Redemption On and after April 15, 2020, the Series B Preferred Stock will be redeemable at our option, in whole or in part. at a redemption price equal to $1,000 per share (equivalent to $25 per depositary share) plus declared and unpaid dividends on the shares of Series B Preferred Stock called for redemption for prior dividend periods. if any. plus accrued but unpaid dividends (whether or not declared) thereon for the then•current dividend period, to. but excluding, the date of redemption, without accumulation of any other undeclared dividends. The depositary shares representing the Series B Preferred Stock will be redeemed if and to the extent that the related shares of Series B Preferred Stock are redeemed by us. Our ability to redeem the Series B Preferred Stock as described above may be limited by the terms of our agreements governing our existing and future indebtedness and by the provisions of other existing and future agreements. The Series B Preferred Stock will not be subject to any sinking fund or other obligation of ours to redeem, purchase or retire the Series B Preferred Stock. See "Description of the Series B Preferred Stock—Redemption" and "Description of the Depositary Shares—Redemption" in this prospectus supplement. S•6 EFTA00607804 Ran r), The Series B Preferred Stock: • will rank senior to ow common stock and any other junior stock with respect to the payment of dividends and distributions upon our liquidation, dissolution or winding-up. Junior stock includes our common stock and any other class or series of our capital stock that ranks junior to the Series B Preferred Stock either as to the payment of dividends or as to the distribution of assets upon our liquidation, dissolution or winding- up; • will rank at least equally with each other class or series of our capital stock ranking on parity with the Series B Preferred Stock, which we refer to as parity stock, as to dividends and distributions upon our liquidation, dissolution or winding-up. Parity stock includes our previously issued 7.50% Non-Cumulative Preferred Stock, Series A, $0.01 par value per share, S25 liquidation preference per share (the "Series A Preferred Stock"); and • will rank junior to each other class or series of our capital stock that by its terms ranks senior to the Series B Preferred Stock as to dividends and distributions upon our liquidation or dissolution or winding-up. As of the date of this prospectus supplement, we do not have any outstanding shares or series of our capital stock that ranks equally with or senior to the Series B Preferred Stock with respect to the payment of dividends and distribution of assets upon our liquidation, dissolution or winding up, other than the Series A Preferred Stock. As of the date hereof, we have 2,200,000 shares of Series A Preferred Stock outstanding having an aggregate liquidation preference of $55.000.000. Liquidation Rights Upon any voluntary or involuntary liquidation, dissolution or winding-up of NGHC, holders of shares of the Series B Preferred Stock and, in turn, the depositary shares are entitled to receive out of our assets available for distribution to stockholders, before any distribution is made to holders of common stock or other junior stock, a liquidating distribution in the amount of the liquidation preference of $1,000 per share of such Series B Preferred Stock (equivalent to $25 per depositary share) plus any declared and unpaid dividends, without accumulation of any undeclared dividends. Distributions will be made pro rata as to the Series B Preferred Stock and any parity stock and only to the extent of our assets, if any, that are available after satisfaction of all S-7 EFTA00607805  liabilities to creditors. Any distributions paid on the Series B Preferred Stock will be distributed to holders of depositary shares in the manner described under "Description of the Depositary Shares—Dividends and Other Distributions" in this prospectus supplement. See "Description of the Series B Preferred Stock—Liquidation Rights" and "Description of the Depositary Shares—Dividends and Other Distributions" in this prospectus supplement. Voting Right\ The holders of the Series B Preferred Stock and, in turn, the depositary shares will not have any voting rights, except under limited circumstances. including with respect to certain fundamental changes in the terms of the Series B Preferred Stock represented by the depositary shares, in the case of certain dividend anearages and except as specifically required by Delaware law. See "Description of the Series B Preferred Stock—Voting Rights" and "Description of the Depositary Shares—Voting Rights" in this prospectus supplement \LIU! It% Neither the depositary shares nor the Series B Preferred Stock represented thereby have any maturity date, and we are not required to redeem the depositary shares or the Series B Preferred Stock represented thereby. Holders of the depositary shares will have no right to have the Series B Preferred Stock redeemed. Accordingly. the shares of Series B Preferred Stock and, in turn, the depositary shares will remain outstanding indefinitely, unless and until we decide to redeem them. Preemptive Rights Holders of the Series B Preferred Stock and, in turn. the depositary shares will have no preemptive rights. Listing We intend to apply to list the depositary shares representing the Series B Preferred Stock on the NASDAQ Global Market under the symbol "NGHCO." If the application is approved, we expect trading to commence within 30 days following the initial issuance of the depositary, shares. We do not intend to list the Series B Preferred Stock on any exchange or expect that there will be any separate public trading market for the shares of the Series B Preferred Stock except as represented by the depositary shares. Tax Consequences For discussion of the tax consequences relating to depositary shares and the Series B Preferred Stock represented thereby, see "Certain U.S. Federal Income Tax Considerations" in this prospectus supplement. S•8 EFTA00607806 Use of Proceeds We estimate that the net proceeds to us from the sale of the depositary shares issued in this offering will be approximately S (or $ if the underwriters exercise their overallotment option in full) after deducting the underwriting discount and our estimated offering expenses. We intend to use the net proceeds of this offering for general corporate purposes, including future acquisitions and to support our current and future policy writings. See "Use of Proceeds" in this prospectus supplement. Transfer Agent and Depositary American Stock Transfer & Trust Company, LLC. Risk Factors See "Risk Factors" in this prospectus supplement and the accompanying prospectus and in our Annual Report on Form 10-K for the year ended December 31, 2014, which is incorporated by reference herein, for the risks you should consider carefully before deciding to invest in depositary shares representing the Series B Preferred Stock. S-9 EFTA00607807  SUMMARY HISTORICAL FINANCIAL DATA The following tables set forth our selected historical consolidated financial and operating information for the periods ended and as of the dates indicated, which is derived from our audited consolidated financial statements and the notes thereto. The following information should be read in conjunction with "Management's Discussion and Analysis of Financial Condition and Results of Operations" and our consolidated financial statements and related notes, which appear in Part IL Items 7 and 8. respectively, of ow Annual Report on Fonn 10-K for the year ended December 31, 2014, which is incorporated by reference herein. For more details on how you can obtain our SEC reports and other information, you should read the section entitled "Where You Can Find More Information; Incorporation by Reference" in this prospectus supplement. Period from March I. 2010 Year Ended December 31. (Inception) to December 31. 2014 2013 2012 2011 2010 (Amounts in Thousands. Except Percentages and per Share Data) Selected Income Statement Date) Gross premium written $2,135,107 $1,338,755 51,351,925 $1,178.891 $ 911,991 Ceded premiums(2) (265,083) (659,439) (719,431) (640.655) (463,422) Net premium written 1,870,024 $ 679,316 $ 632,494 $ 538,236 $ 448,570 Change in unearned premium (236,804) 8,750 (58,242) (40,026) 112,347 Net earned premium 1,633,220 $ 688,066 $ 574,252 $ 498,210 $ 560,917 Ceding commission (primarily related parties) 12,430 87,100 89,360 77,475 49,656 Service and fee income 168,571 127,541 93,739 66,116 53,539 Net investment income 52,426 30,808 30,550 28,355 25,391 Net realized gain on investments (2,892) (1,669) 16,612 4,775 3,293 Other revenue (1,660) 16 3,728 33,238 Total revenues 1,862,095 $ 931,862 $ 808,241 $ 674,931 $ 726,034 Loss and LAE 1,053,065 462,124 402,686 340,152 370,313 Acquisition costs and other underwriting costso) 315,089 134,887 110,771 75,191 36,755 General and administrativeg) 348,762 280,552 246,644 208,939 176,428 Interest expense 17,736 2,042 1,787 1,994 1,795 Total expenses 1,734,652 $ 879,605 $ 761,888 $ 626,276 $ 585,291 Income before provision for income taxes and equity in earnings (losses) of unconsolidated subsidiaries $ 127,443 $ 52,257 $ 46,353 $ 48,655 $ 140,743 Provision for income taxes 23,876 11,140 12,309 28,301 42,416 Income before equity in earnings (loss) of unconsolidated subsidiaries and non- controlling interest $ 103,567 $ 41,117 $ 34,044 $ 20,354 $ 98,327 Equity in earnings (loss) of unconsolidated subsidiaries 1,180 1,274 (1,338) 23,760 3,876 Net income 104,747 $ 42,391 $ 32,706 $ 44,114 $ 102.201 Non-controlling interest (2,504) (82) (14) Net income attributable to National General Holdings Corp $ 102,243 $ 42,309 $ 32,706 $ 44.100 $ 102,203 Less: cumulative dividends on preferred shares (2,291) $ (2,158) $ (4,674) $ (4,328) $ (3,537) S-10 EFTA00607808  Period from March I. 20111 Year Ended December 31, I'm:cation i to December 31. 2014 2013 2012 2011 2010 (Amounts in Thousands. Except Percentages and per Share Data) Net income attributable to National General Holdings Corp. common stockholders $ 99,952 $ 40,151 $ 28,032 $ 39,772 $ 98,666 Basic earnings per share) $ 1.09 $ 0.62 $ 0.62 $ 0.87 $ 2.17 Dividends declared per common share $ 0.05 $ 0.01 $ — $ — $ 0.16 Weighted average shares outstanding basic 91,499 65,018 45,555 45,555 45,555 Diluted earnings per share $ 1.07 $ 0.59 $ 0.56 $ 0.75 $ 1.77 Weighted average shares outstanding—diluted 93,515 71,802 58,287 58,469 57,850 Insurance Ratios Net loss ratio16) 64.5% 67.2% 70.1% 68.3% 66.0% Net operating expense ratio (non-GAAPY7x8) 29.6% 29.2% 30.4% 28.2% 19.6% Net combined ratio (non-GAAPP9) 94.1% 96.4% 100.5% 96.5% 85.6%