STEI Stewart Enterprises - Class A (MM)

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS

TO BE HELD ON AUGUST 13, 2013

TO THE SHAREHOLDERS OF STEWART ENTERPRISES, INC.:

NOTICE IS HEREBY GIVEN that a special meeting of shareholders of Stewart Enterprises, Inc. (the “Company,” “Stewart,” “we,” “us” or “our”) will be held at 11:00 a.m., local time, on August 13, 2013, at 1333 South Clearview Parkway, Jefferson, Louisiana 70121, for the following purposes:

1. To consider and vote on a proposal to approve the Agreement and Plan of Merger, dated as of May 28, 2013, by and among Service Corporation International, Rio Acquisition Corp. and Stewart (as such agreement may be amended from time to time, the merger agreement);

2. To approve, on a non-binding, advisory basis, certain compensation that may be paid or become payable to Stewart’s named executive officers in connection with the merger; and

3. To approve the adjournment of the special meeting, if necessary, to solicit additional proxies to approve the merger agreement if there are insufficient votes at the time of the special meeting to approve the merger agreement.

After careful consideration, Stewart’s board of directors, based on the unanimous recommendation of a special committee of independent directors, has unanimously approved and declared advisable the merger agreement and merger, and determined that the merger agreement and merger are fair to, and in the best interests of, the Company and its shareholders. Our board of directors unanimously recommends that you vote “FOR” the proposal to approve the merger agreement, “FOR” the proposal to approve, by a non-binding, advisory vote, the compensation that may become payable to the Company’s named executive officers in connection with the completion of the merger and “FOR” the proposal to adjourn the special meeting, if necessary, to solicit additional proxies to approve the merger agreement if there are not sufficient votes to approve the merger agreement.

Only holders of record of our Class A and Class B common stock at the close of business on July 8, 2013, the record date for the special meeting, may vote at the special meeting.

The proposal to approve the merger agreement requires the affirmative vote of at least two-thirds of the voting power present in person or represented by proxy and entitled to vote at the special meeting. The proposal to approve, on a non-binding, advisory basis, certain compensation that may be paid or become payable to our named executive officers in connection with the merger requires the affirmative vote of a majority of the voting power present in person or represented by proxy and entitled to vote at the special meeting. The proposal to adjourn the special meeting, if necessary, to solicit additional proxies to approve the merger agreement also requires the affirmative vote of a majority of the voting power present in person or represented by proxy and entitled to vote at the special meeting.

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Dissenting shareholders who comply with the procedural requirements of the Business Corporation Law of Louisiana will be entitled to receive payment of the fair cash value of their shares if the merger is effected upon approval by less than 80 percent of Stewart’s total voting power. If the merger is effected upon approval by 80 percent or more of Stewart’s total voting power, such dissenters’ rights will not be available.

Your vote is very important. Even if you do not expect to attend the meeting in person, it is important that your shares be represented. If you plan to attend the meeting in person, we also request that you submit your proxy or voting instructions to ensure that your shares will be represented at the meeting if you are unable to attend. You may submit your proxy (i) via the Internet at www.envisionreports.com/STEI, (ii) by phone at 1-800-652-VOTE (8683), or (iii) by completing and signing the enclosed proxy and returning it in the accompanying post-paid envelope. If your shares are held in the name of a broker, bank or other nominee, you may provide your voting instructions in accordance with the instructions provided by your broker, bank or other nominee. If you attend the meeting, you may also submit your vote in person, and any proxies or instructions you previously submitted – whether by the Internet, by phone, or by mail – will be superseded by the vote you cast at the special meeting.

For more information about the merger and the other transactions contemplated by the merger agreement, please review the accompanying proxy statement and the merger agreement attached to it as Annex A.

Jefferson, Louisiana

July 11, 2013

YOUR VOTE IS IMPORTANT.

WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE COMPLETE, DATE AND SIGN THE ENCLOSED PROXY CARD AND RETURN IT AS PROMPTLY AS POSSIBLE IN THE ENCLOSED REPLY ENVELOPE. IF YOU HOLD SHARES DIRECTLY IN YOUR NAME, YOU MAY ALSO SUBMIT YOUR PROXY OVER THE INTERNET OR BY TELEPHONE. IF YOU ARE ABLE TO SUBMIT YOUR VOTING INSTRUCTIONS OVER THE INTERNET OR BY TELEPHONE, INSTRUCTIONS ARE PRINTED ON YOUR PROXY CARD. IF YOU ATTEND THE MEETING, YOU MAY REVOKE YOUR PROXY AND VOTE IN PERSON IF YOU DESIRE TO DO SO.

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SUMMARY TERM SHEET

The following summary term sheet highlights selected information from this proxy statement and may not contain all of the information that is important to you. Accordingly, we encourage you to read carefully this entire proxy statement, its annexes and the documents referred to or incorporated by reference in this proxy statement. In this proxy statement, unless the context requires otherwise, the terms “Stewart,” “Company,” “we,” “our,” “ours,” and “us” refer to Stewart Enterprises, Inc. and its subsidiaries. The term “merger agreement” refers to the Agreement and Plan of Merger, dated as of May 28, 2013, by and among Service Corporation International and its wholly-owned subsidiary Rio Acquisition Corp., and Stewart, as such agreement may be amended from time to time. The term “SCI” refers to Service Corporation International and the term “Merger Sub” refers to Rio Acquisition Corp.

The Companies

Stewart Enterprises, Inc.

1333 South Clearview Parkway

Jefferson, Louisiana 70121

(504) 729-1400

Founded in 1910, Stewart Enterprises, Inc., a corporation organized under the laws of the State of Louisiana and headquartered in Jefferson, Louisiana, is the second largest provider of funeral and cemetery products and services in the death care industry in the United States. Through our subsidiaries, we provide a complete range of funeral and cremation merchandise and services, along with cemetery property, merchandise and services, both at the time of need and on a preneed basis. As of April 30, 2013, our operations included 217 funeral homes and 141 cemeteries (including 69 funeral service/cemetery combination locations) in 24 states within the United States and in Puerto Rico. For more information about Stewart, please visit our web site at www.stewartenterprises.com. The information provided in the Stewart web site is not part of, and is not incorporated by reference into, this proxy statement or any other report or document filed with or furnished to the Securities and Exchange Commission, or the SEC. Stewart is publicly traded on The NASDAQ Global Select Market under the symbol “STEI.”

Service Corporation International

1929 Allen Parkway

Houston, Texas 77019

(713) 522-5141

Founded in 1962, Service Corporation International, a corporation organized under the laws of the State of Texas and headquartered in Houston, Texas, is the largest provider of deathcare products and services in the United States. As of March 31, 2013, SCI operated 1,437 funeral service locations and 374 cemeteries (including 213 funeral service/cemetery combination locations) in North America, which are geographically diversified across 43 states, eight Canadian provinces and the District of Columbia. For more information about SCI, please visit its web site at www.sci-corp.com. The information provided on the SCI web site is not part of, and is not incorporated by reference into, this proxy statement or any other report or document filed with or furnished to the SEC. SCI is publicly traded on the NYSE under the symbol “SCI.”

Rio Acquisition Corp.

c/o Service Corporation International

1929 Allen Parkway

Houston, Texas 77019

(713) 522-5141

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Rio Acquisition Corp., a corporation organized under the laws of the State of Delaware, is a wholly-owned subsidiary of SCI. Merger Sub was formed on May 17, 2013, solely for the purpose of effecting the merger and has not engaged in any other business.

The Special Meeting

Date, Time and Place (page 18)

The special meeting will be held on August 13, 2013, at 11:00 a.m. local time, at 1333 South Clearview Parkway, Jefferson, Louisiana 70121.

Purpose (page 18)

The purpose of the special meeting is:

Recommendation of the Board of Directors (page 18)

Our board of directors unanimously recommends that you vote:

Record Date (page 18)

If you owned shares of our Class A or Class B common stock at the close of business on July 8, 2013, the record date for the special meeting, you are entitled to vote at the special meeting. You have one vote for each share of our Class A common stock and ten votes for each share of our Class B common stock that you owned on the record date. As of the close of business on the record date, there were 82,146,854 shares of Class A common stock and 3,555,020 shares of Class B common shares outstanding and entitled to be voted at the special meeting held by approximately 750 holders and one holder of record, respectively.

Required Vote (page 18)

The presence, in person or represented by proxy, of a majority of the total voting power constitutes a quorum. Shares represented at the meeting by proxies reflecting a vote on any proposal, including broker non-votes, will be counted as present for quorum purposes. Approval of the merger agreement requires the

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affirmative vote of at least two-thirds of the voting power present in person or represented by proxy and entitled to vote at the special meeting. Approval of the proposal with respect to the advisory vote on the compensation that may be paid or become payable to our named executive officers in connection with the merger requires the affirmative vote of a majority of the voting power present in person or represented by proxy and entitled to vote at the meeting. The vote on the compensation that may be paid or become payable to our named executive officers in connection with the merger is advisory in nature and will not be binding on Stewart or our board of directors. The proposal to approve the adjournment of the special meeting, if necessary, to solicit additional proxies to approve the merger agreement requires the affirmative vote of a majority of the voting power present in person or represented by proxy and entitled to vote at the meeting.

Frank B. Stewart, Jr. entered into a voting and support agreement with SCI on May 28, 2013, referred to as the voting agreement, pursuant to which he has agreed to vote shares representing 29.99% of the aggregate voting power in favor of approving the merger agreement.

Submitting Your Proxy (page 19)

We offer our shareholders of record three ways to submit their proxy:

If you hold your shares in “street name” through a broker, bank or other nominee, you will receive separate instructions from your broker, bank or other nominee explaining how to vote your shares.

Revocability of Proxy (page 20)

If you are a shareholder of record, you may revoke your proxy at any time before it is voted at the special meeting by:

Simply attending the special meeting will not constitute revocation of your proxy. If your shares are held in “street name” by your broker, bank or other nominee, you should follow the instructions of your broker, bank or other nominee regarding revocation of voting instructions.

The Merger

Structure of the Merger (page 51)

Upon the terms and subject to the conditions of the merger agreement, Merger Sub, a wholly-owned subsidiary of SCI, will merge with and into us, which we refer to herein as the merger. We will be the surviving corporation. As a result of the merger, we will become a wholly-owned subsidiary of SCI and will cease to be a publicly-traded company. The merger agreement is attached as Annex A to this proxy statement. Please read it carefully.

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Consideration to be Received in the Merger (page 51)

Each holder of shares of our Class A and Class B common stock will be entitled to receive $13.25 in cash, plus, in certain limited circumstances, the additional per share consideration, without interest, for each share of our Class A and Class B common stock held immediately prior to the time of completion of the merger. Shares owned by SCI, Merger Sub or any wholly-owned subsidiary of SCI or Merger Sub and shares owned by us or any of our wholly-owned subsidiaries will be cancelled without any payment in the merger.

If the closing date of the merger occurs after December 30, 2013, additional per share consideration in the amount of $0.002178 per share will be payable for each day during the period after December 30, 2013 through the closing date of the merger, but subtracting each day following the later of (i) the sixtieth day from the date of service of any request for additional information or documentary material, or second request, under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, or HSR Act, and (ii) the date on which SCI, but not Stewart, has certified substantial compliance with the second request, until, in each case, the day on which Stewart certifies substantial compliance with such second request.

Opinion of Goldman, Sachs & Co. as Financial Advisor to the Special Committee (page 31)

Goldman, Sachs & Co., or Goldman Sachs, rendered its opinion to the special committee of the board of directors, or special committee, of the Company that, as of May 28, 2013, and based upon and subject to the factors and assumptions set forth in its opinion, the $13.25 per share in cash to be paid to the holders of outstanding shares of Class A common stock pursuant to the merger agreement was fair from a financial point of view to such holders. Goldman Sachs did not express any opinion with respect to the consideration being paid to the holders of Class B common stock or any additional cash consideration that may be paid pursuant to the merger agreement.

The full text of the written opinion of Goldman Sachs, dated May 28, 2013, 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 to this proxy statement. The summary of the Goldman Sachs opinion provided in this proxy statement is qualified in its entirety by reference to the full text of the written opinion. Goldman Sachs provided its advisory services and opinion for the information and assistance of the special committee in connection with its consideration of the merger. Goldman Sachs’ opinion is not a recommendation as to how any holder of Class A common stock should vote with respect to the merger or any other matter. Pursuant to an engagement letter between the special committee and Goldman Sachs, the Company has agreed to pay Goldman Sachs a transaction fee of approximately $11 million, of which approximately $9.75 million is contingent upon consummation of the transaction.

Financing of the Merger (pages 37 and 61)

Stewart and SCI estimate that the total amount of funds required to pay the aggregate merger consideration, effect the refinancing of Stewart’s indebtedness to the extent required by its terms, and pay in full all other amounts, including fees and expenses required to be paid by SCI under the merger agreement, will be approximately $1.6 billion, including debt and cash acquired. In connection with entering into the merger agreement, SCI entered into a commitment letter with JPMorgan Chase Bank, N.A., or JPMCB, and J.P. Morgan Securities LLC, pursuant to which, among other things, JPMCB agreed, subject to the terms and conditions in the commitment letter, to provide such funds. As permitted under the terms of the commitment letter, it was amended on June 7, 2013 to provide that a portion of the financing would also be provided by Bank of America, N.A. and Wells Fargo Bank, National Association and an affiliate. On July 1, 2013, SCI issued $425 million aggregate principal amount of 5.375% Senior Notes due 2022 in a private offering. The net proceeds of this notes offering of approximately $414.7 million will be held in an escrow account pending the closing of the merger. On July 2, 2013, as part of its permanent financing for the merger, SCI entered into a new credit facility consisting of a $500 million revolving credit facility (in replacement of SCI’s existing revolving credit facility) and a term loan of up to $600 million; the term loan will be drawn contemporaneously with the closing of the merger.

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Voting Agreement (page 45)

Frank B. Stewart, Jr., our Chairman of the Board, and his spouse have entered into a voting agreement with SCI, pursuant to which Mr. Stewart has agreed, among other things, to vote shares representing 29.99% of the aggregate voting power for the approval of the merger agreement. Mr. Stewart is not obligated to vote for the approval of the merger agreement if, among other things, the merger agreement is terminated. A copy of the voting agreement executed by Mr. Stewart is attached as Annex C to this proxy statement.

Mr. Stewart has informed us that, as of the date of this proxy statement, he also intends to vote his additional shares (which are not subject to the voting agreement or any similar agreement, arrangement or commitment with respect to voting) in favor of the merger agreement.

Conditions to the Merger (page 64)

We, SCI and Merger Sub are not required to complete the merger unless a number of conditions are satisfied or waived, as applicable. These conditions include:

In addition, SCI and Merger Sub are not required to complete the merger if there has occurred any material adverse effect on our business, financial condition, results of operations or ability to consummate the merger since the date of the merger agreement.

No Solicitation (page 58)

We have agreed that we will and will instruct our representatives to:

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However, at any time prior to the approval of the merger agreement by our shareholders, we are permitted, upon the terms and subject to the conditions in the merger agreement, to:

Termination of the Merger Agreement (page 65)

The merger agreement may be terminated and the merger may be abandoned at any time prior to the completion of the merger, as follows:

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Termination Fee (page 66)

We will be required to pay SCI a termination fee of $27.5 million if:

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SCI will be required to pay us a termination fee of $75.0 million if:

In any such case, SCI will be required to pay the Company $50.0 million of the $75.0 million termination fee concurrently with such termination (if terminated by SCI) or within two business days following such termination (if terminated by the Company). Within 60 days from the date of such termination, we must elect either to (i) accept the remaining $25.0 million of the termination fee in full satisfaction of our rights under the merger agreement or (ii) require SCI to place the $25.0 million in escrow and pursue our other rights and remedies under law or at equity, including specific performance and damages arising out of a knowing and intentional breach of the merger agreement by SCI or Merger Sub. If we pursue and are unsuccessful in our claims, we will forfeit the $25.0 million. If we receive an award for damages, then if we are awarded more than $75.0 million, we will receive the $25.0 million from the escrow plus any additional damages awarded. If we are awarded less than $75.0 million, we will receive from the escrow an amount equal to the award (less the $50.0 million we have already received, it being understood that we will not have to return any of the $50.0 million).

Expense Reimbursement (page 68)

If shareholders do not approve the merger agreement at the special meeting, we will be required to reimburse SCI for all reasonable out-of-pocket fees and expenses incurred or paid by or on behalf of SCI (including all fees and expenses of legal counsel, accountants, investment banks, financing sources, experts and consultants) incurred in connection with the authorization, preparation, negotiation, execution and performance of the merger agreement, filings under the HSR Act, and financing, collectively referred to herein as expenses, up to $10.0 million.

If we later become obligated to pay the termination fee to SCI after paying expenses to SCI, the amount of expenses we previously paid to SCI will be credited toward our payment of the termination fee. See the section entitled “The Merger Agreement (Proposal 1)—Termination Fee” beginning on page 66 of this proxy statement for a discussion of the circumstances under which the termination fee would be required to be paid.

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Prior to the closing, SCI is required to reimburse us for our expenses incurred in fulfilling our obligations under the merger agreement to cooperate with SCI in its efforts to complete its financing of the merger.

Regulatory Matters (page 47)

We and SCI are required to make a filing under the HSR Act in connection with the merger. The HSR Act provides that certain acquisition transactions may not be consummated unless specified information has been furnished to the Antitrust Division of the U.S. Department of Justice, or the DOJ, and the Federal Trade Commission, or the FTC, and certain waiting period requirements have been satisfied.

Filings made under the HSR Act are subject to a 30-day initial waiting period, for which early termination may be requested. However, the DOJ or the FTC may extend the waiting period by requesting, prior to the expiration of the initial waiting period, additional information or documentary material from the parties to the acquisition transaction (referred to as the second request). If a second request is made, the waiting period will expire at 11:59 p.m., New York City time, on the thirtieth day after substantial compliance by both parties with the second request. Only one extension of the waiting period pursuant to a request for additional information is authorized by the HSR Act. The expiration or termination of the applicable waiting period under the HSR Act, and the expiration or termination of any agreement with the DOJ or FTC not to consummate the merger, are conditions to completion of the merger. The Company and SCI filed the requisite notification and report forms with the DOJ and FTC on June 13, 2013, and the initial waiting period is scheduled to expire on July 15, 2013.

At any time before or after completion of the merger, either the DOJ or the FTC could take such action under the antitrust laws as it deems necessary or desirable in the public interest, including seeking to enjoin the merger or otherwise seeking divestiture of substantial assets of either or both of SCI and Stewart. Private parties, as well as state governments, may also bring legal action under the antitrust laws under certain circumstances. See “The Merger Agreement (Proposal 1)—Conditions to the Merger” and “The Merger Agreement (Proposal 1)—Efforts to Complete the Merger; Governmental Approvals.”

Dissenters’ Rights (page 69)

Under Louisiana law, you may be entitled to dissenters’ rights in connection with the merger.

If the merger agreement is approved by two-thirds of the voting power present in person or represented by proxy and entitled to vote at the special meeting, as required by the Louisiana Business Corporation Law, but not by at least 80 percent of the total voting power, and the merger is completed, each shareholder that:

will be entitled to the rights and remedies of a dissenting shareholder provided in Section 131 of the Louisiana Business Corporation Law, a copy of which is included as Annex D hereto.

Interests of Certain Persons in the Merger (page 40)

In considering the recommendation of our board of directors with respect to the merger agreement, you should be aware that our directors and executive officers have interests in the merger that are different from, or in addition to, those of our shareholders generally. These interests may create potential conflicts of interest. The board was aware of these potential conflicts of interest and considered them, among other matters, in reaching its decision to approve the merger agreement and to recommend that our shareholders vote in favor of approving the merger agreement.

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As of July 8, 2013, our directors and executive officers held and are entitled to vote, in the aggregate, 8,168,429 and 3,555,020 shares of our Class A and Class B common stock, respectively, representing approximately 38% of the voting power of the outstanding shares entitled to vote. These shares include 716,665 shares of restricted common stock held by our directors and executive officers, all of which will become unrestricted and fully vested as a result of the completion of the merger. Frank B. Stewart, Jr., our Chairman of the Board, beneficially owns 6,350,201 and 3,555,020 shares of our Class A and Class B common stock, respectively. Each share of Class A common stock has one vote per share and each share of Class B common stock has ten votes per share, which results in Mr. Stewart having approximately 35% of the total voting power, while holding approximately 11% of our outstanding equity. The merger agreement provides that each holder of shares of our common stock, including our directors and executive officers, will be entitled to receive $13.25 in cash, plus the additional per share consideration (if any), without interest, and less any applicable withholding taxes, for each share of our common stock held immediately prior to the merger.

Mr. Stewart and his spouse entered into a voting agreement on May 28, 2013 with SCI, in which he agreed to vote shares representing 29.99% of the aggregate voting power in favor of approving the merger agreement, unless the voting agreement is terminated under certain circumstances.

Mr. Stewart told us he did not receive any special or additional consideration in connection with the merger agreement and voting agreement not available to all of our shareholders. SCI represented to us in the merger agreement, that as of the date of the merger agreement, none of SCI or its affiliates is a party to any oral or written agreement or commitment with Mr. Stewart (or, to SCI’s knowledge, any of Mr. Stewart’s affiliates or associates or immediate family members or any other person at the request of Mr. Stewart or of any person known by SCI to be acting at the direction of Mr. Stewart), other than the voting agreement.

As of July 8, 2013, our executive officers held 716,665 shares of restricted stock and options to purchase 2,838,000 shares of our Class A common stock, of which 1,600,250 shares were unvested. These options have a weighted average exercise price of $6.09 per share. In accordance with their terms, immediately prior to the completion of the merger, (i) each share of restricted stock will become fully vested and (ii) each unvested option then outstanding will be accelerated and become fully vested. Each restricted stock holder, including our executive officers, will be entitled to receive $13.25 for each share of restricted stock. Each option issued under the Stewart Enterprises, Inc. 2007 Stock Incentive Plan and the Amended and Restated Stewart Enterprises, Inc. 2010 Stock Incentive Plan will be cancelled at closing and each option holder, including our executive officers, will be entitled to receive a sum in cash equal to (i) the excess, if any, of the merger consideration over the applicable exercise price of such option multiplied by (ii) the number of Class A shares such holder could have acquired pursuant to such option. The merger agreement provides that we will use reasonable best efforts to have each person who holds options issued under the Amended and Restated Stewart Enterprises, Inc. 1995 Incentive Compensation Plan, the 1995 Plan, execute an amendment to his or her stock option agreement in order to consent to this treatment.

All of our executive officers, except Thomas M. Kitchen, our President and Chief Executive Officer, are participants in the Company’s Retention Plan, which provides for severance payments that may become payable upon a qualifying termination of employment that occurs in connection with the merger. Mr. Kitchen has an employment agreement that provides for severance payments upon a qualifying termination of employment that occurs in connection with the merger.

After completion of the merger, the Company will, and SCI has agreed to cause the Company to, to the fullest extent permitted under the Louisiana Business Corporation Law, exculpate, indemnify and hold harmless, and advance expenses to, each of our present and former directors and officers in accordance with the terms of our organizational documents, indemnity contracts and applicable law existing immediately prior to the date of the merger agreement. Additionally, prior to completion of the merger, we are required to obtain a policy of directors’ and officers’ liability insurance coverage for the benefit of our executive officers and directors for six years following completion of the merger. SCI has guaranteed the Company’s performance of these obligations.

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QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETING AND THE MERGER

The following questions and answers are provided for your convenience and briefly address some commonly asked questions about the merger and the special meeting. You should carefully read this entire proxy statement, its annexes and the documents referred to or incorporated by reference in this proxy statement. In this proxy statement, unless the context requires otherwise, the terms “Stewart”, “Company”, “we”, “our”, “ours” and “us” refer to Stewart Enterprises, Inc. and its subsidiaries. The term “merger agreement” refers to the Agreement and Plan of Merger, dated as of May 28, 2013, by and among Service Corporation International and its wholly-owned subsidiary Rio Acquisition Corp., and Stewart, as such agreement may be amended from time to time. The term “SCI” refers to Service Corporation International and the term “Merger Sub” refers to Rio Acquisition Corp.

The Special Meeting

Pursuant to the voting agreement entered into on May 28, 2013, Frank B. Stewart, Jr., our Chairman of the Board, agreed to vote shares representing 29.99% of the aggregate voting power at the special meeting in favor of approving the merger agreement, unless the voting agreement is terminated under certain circumstances.

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If your shares are held in a stock brokerage account or by a broker, bank or other nominee, you are considered the “beneficial owner” of shares held in “street name.” The proxy materials have been forwarded to you by your broker, bank or other nominee who is considered, with respect to those shares, the shareholder of record. As the beneficial owner, you have the right to direct your broker, bank or other nominee how to vote your shares by following the voting instructions on the form that you receive from your broker, bank or other nominee.

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Street name holders : If your shares are held in street name, you must provide your voting instructions in accordance with the voting instruction form provided by your broker, bank or other nominee. The availability of telephone and Internet voting will depend on your broker’s, bank’s or other nominee’s voting process.

In person at the special meeting : You may also vote in person at the special meeting, either by attending the meeting yourself or authorizing a representative to attend the meeting on your behalf. You must execute a proper proxy designating that person. If you are a beneficial owner of shares, you must obtain a proxy from your broker, bank or other nominee naming you as the proxy holder and present it to the inspector of election with your ballot when you vote at the special meeting.

Abstentions will have the effect of a vote against each of the proposals, while broker non-votes will not affect each of the proposals.

and in accordance with the recommendations of our board of directors on any other matters properly brought before the meeting for a vote.

If you are the beneficial owner of shares and do not give voting instructions to your broker, bank or other nominee on a proposal, your shares will not be voted on that proposal.

If your shares are held in the name of a broker, bank or other nominee, you should submit your voting instructions to your broker, bank or other nominee as soon as possible so that your shares will be voted at the special meeting.

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The Merger

If the closing date of the merger occurs after December 30, 2013, additional per share consideration in the amount of $0.002178 per share will be payable for each day during the period after December 30, 2013 through the closing date, but subtracting each day following the later of (i) the sixtieth day from the date of service of any second request under the HSR Act, and (ii) the date on which SCI, but not Stewart, has certified substantial compliance with the second request, until, in each case, the day on which Stewart certifies substantial compliance with such second request.

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Merger Sub is Rio Acquisition Corp., a corporation organized under the laws of the State of Delaware, and a wholly-owned subsidiary of SCI. Merger Sub was formed on May 17, 2013, solely for the purpose of effecting the merger and has not engaged in any other business.

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This proxy statement, and the documents to which we refer in this proxy statement, contain forward-looking statements about our plans, objectives, expectations and intentions. Forward-looking statements include information concerning possible or assumed future results of operations of Stewart, the expected completion and timing of the merger and other information relating to Stewart and the merger. You can identify these statements by words such as “expect”, “anticipate”, “intend”, “plan”, “believe”, “seek”, “estimate”, “may”, “project,” “will” and “continue” or similar words. You should read statements that contain these words carefully. They discuss our future expectations or state other forward-looking information, and may involve known and unknown risks and uncertainties, including without limitation:

See “Where You Can Find More Information” on page 81 of this proxy statement. You should not place undue reliance on forward-looking statements. We cannot guarantee any future results, levels of activity, performance or achievements. The statements made in this proxy statement represent our views as of the date of this proxy statement and you should not assume that the statements made herein remain accurate as of any later date. Moreover, we assume no obligation to update forward-looking statements to reflect events or circumstances after the date of this proxy statement.

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THE SPECIAL MEETING

We are furnishing this proxy statement to you, as a shareholder of Stewart, as part of the solicitation of proxies by our board of directors for use at the special meeting of shareholders.

Date, Time, Place and Purpose of the Special Meeting

This proxy statement is being furnished to our shareholders in connection with the solicitation of proxies by our board of directors for use at the special meeting to be held on August 13, 2013, beginning at 11:00 a.m. local time at 1333 South Clearview Parkway, Jefferson, Louisiana 70121. The purpose of the special meeting is:

Our board of directors, based on the unanimous recommendation of a special committee of independent directors, has unanimously approved and declared advisable the merger agreement and merger, and determined that the merger agreement and merger are fair to, and in the best interests of, Stewart and its shareholders. Accordingly, our board of directors unanimously recommends that our shareholders vote:

Record Date; Quorum

As of the close of business on July 8, 2013, the record date for the special meeting, there were 82,146,854 shares of our Class A common stock and 3,555,020 shares of our Class B common stock held by approximately 750 holders and one holder of record, respectively. The presence, in person or represented by proxy, of a majority of the total voting power constitutes a quorum. Abstentions will be counted as present for the purpose of determining the existence of a quorum. Shares represented at the meeting by proxies reflecting a vote on any proposal, including broker non-votes, will be counted as present for quorum purposes. In the event that a quorum is not present at the special meeting, we currently expect that we will adjourn the meeting to solicit additional proxies in order to obtain a quorum, which would subject the Company to additional expense. See “—Postponements and Adjournments.”

Required Vote

The proposal to approve the merger agreement requires the affirmative vote of two-thirds of the voting power present in person or represented by proxy and entitled to vote at the special meeting. The proposal to approve, on an advisory basis, the compensation that may be paid or become payable to our named executive officers in connection with the merger requires the affirmative vote of a majority of the voting power present in person or represented by proxy and entitled to vote at the special meeting. The vote on the compensation that

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may be paid or become payable to our named executive officers in connection with the merger is advisory in nature and will not be binding on Stewart or SCI. The proposal to adjourn the meeting, if necessary, to solicit additional proxies to approve the merger agreement requires the affirmative vote of a majority of the voting power present in person or represented by proxy and entitled to vote at the special meeting.

Each holder of a share of our Class A common stock is entitled to one vote per share, and each holder of a share of our Class B common stock is entitled to ten votes per share. Failure to submit a proxy or voting instructions or to vote at the special meeting will result in your shares not being voted. Abstentions will count for the purpose of determining whether a quorum is present. Abstentions, however, will have the effect of a vote against each of the proposals.

Banks, brokers or other nominees who hold shares of our common stock in “street name” for customers who are the beneficial owners of such shares may not give a proxy to vote those customers’ shares in the absence of specific instructions from those customers. Shares of our common stock not voted on a particular matter, or a “broker non-vote”, will be counted for the purpose of determining whether a quorum is present as long as the proxy is voted on at least one agenda item. A broker non-vote on a particular matter will be considered not present with respect to that matter and therefore will not affect the outcome of the vote on that matter.

Voting by Frank B. Stewart, Jr., our Chairman of the Board

Frank B. Stewart, Jr., our Chairman of the Board, beneficially owns 6,350,201 and 3,555,020 shares of our Class A and Class B common stock, respectively. Each share of Class A common stock has one vote per share and each share of Class B common stock has ten votes per share, which results in Mr. Stewart having approximately 35% of the total voting power, while holding approximately 11% of our outstanding equity.

Mr. Stewart and his spouse entered into a voting agreement dated as of May 28, 2013 with SCI, which provides, among other things, that Mr. Stewart will vote shares representing 29.99% of our aggregate voting power in favor of approving the merger agreement. Although Mr. Stewart entered into a voting agreement, there are no other arrangements between Mr. Stewart, on the one hand, and SCI, on the other hand, and Mr. Stewart will receive the same merger consideration as our other shareholders for both his Class A and Class B common stock. Mr. Stewart is not obligated to vote for the approval of the merger agreement, if, among other things, the merger agreement is terminated. A copy of the voting agreement signed by Mr. Stewart is attached as Annex C to this proxy statement.

Mr. Stewart has informed us that, as of the date of this proxy statement, he also intends to vote his additional shares (which are not subject to the voting agreement or any similar agreement, arrangement or commitment with respect to voting) in favor of the merger agreement.

Voting; Submission of Proxy

Shareholders may vote their shares by attending the special meeting and voting their shares of our common stock in person.

Shareholders may submit their proxy by:

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If your shares are held in the name of a broker, bank or other nominee, you must provide your voting instructions in accordance with the voting instructions form provided by your broker, bank or other nominee.

All shares of our common stock represented by properly executed proxies received in time for the special meeting will be voted at the special meeting in the manner specified by the holder. If a written proxy card is signed by a shareholder and returned without instructions, the shares of our common stock represented by the proxy will be voted “FOR” the approval of the merger agreement, “FOR” the approval of the compensation, on an advisory basis, that may be paid or become payable to our named executive officers in connection with the merger and “FOR” the approval to adjourn the meeting, if necessary, to solicit additional proxies to approve the merger agreement, and in accordance with the recommendations of our board of directors on any other matters properly brought before the meeting for a vote.

Shareholders who have questions or requests for assistance in completing and submitting proxy cards should contact Georgeson Inc., our proxy solicitor, at 1-800-248-3170.

Shareholders who hold their shares in “street name”, meaning in the name of a broker, bank or other nominee who is the record holder, must either direct the record holder of their shares how to vote their shares or obtain a proxy from the record holder to vote their shares at the special meeting.

Revocability of Proxies or Voting Instructions

You can revoke your proxy at any time before it is voted at the special meeting by:

Simply attending the special meeting will not constitute revocation of your proxy. If your shares are held in the name of a broker, bank or other nominee who is the record holder, you must follow the instructions of your broker, bank or other nominee to revoke a previously given voting instruction.

Solicitation of Proxies

In addition to solicitation by mail, our directors, officers and employees may solicit proxies by telephone, other electronic means or in person. These people will not receive any additional compensation for their services, but we will reimburse them for their out-of-pocket expenses. We will reimburse brokers, banks or other nominees for their reasonable expenses in forwarding copies of this proxy statement to the beneficial owners of shares of our common stock and in obtaining voting instructions from those owners.

We have retained Georgeson Inc. to assist in the solicitation of proxies by mail, telephone or other electronic means, or in person, for a fee of approximately $9,000 plus expenses relating to the solicitation.

Postponements and Adjournments

Although it is not currently expected, the special meeting may be postponed or adjourned. A postponement or adjournment may occur under any of the methods described below:

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Other Business

Our board does not expect to bring any other matter before the special meeting and is not aware of any other matter that may be considered at the meeting. However, if any other matter does properly come before the meeting, the proxy holders will vote the proxies in their discretion.

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THE MERGER

This discussion of the merger is qualified by reference to the merger agreement, which is attached to this proxy statement as Annex  A. You should read the entire merger agreement carefully as it is the legal document that governs the merger.

Background of the Merger

Our board of directors regularly reviews our business strategy with the primary objective of maximizing shareholder value.

In June 2008, SCI made a proposal, which it made public in July 2008, to acquire all of our outstanding Class A and Class B common stock for $9.50 per share in cash. SCI later increased the proposal to $11.00 per share in cash, but subsequently withdrew its proposal in October 2008.

No other interested parties contacted the Company with a proposal to acquire the Company following SCI’s public offer in 2008, and the Company continued to operate on a standalone basis.

On December 5, 2012, our board received a letter from Thomas L. Ryan, President and Chief Executive Officer of SCI, proposing that SCI acquire all of our outstanding Class A and Class B common stock for $10.00 per share in cash, subject to limited and confirmatory due diligence.

The board considered the SCI proposal at a meeting on December 12, 2012. Frank B. Stewart, Jr., Chairman of the Board and a significant shareholder of the Company, and Thomas M. Kitchen, our President and Chief Executive Officer, informed the board that they had each received a call from Mr. Ryan shortly before the letter was delivered, advising them that the letter was forthcoming. John C. McNamara, financial advisor to Mr. Stewart, advised the board that he had received an unsolicited call from Mr. Ryan approximately one month earlier during which Mr. Ryan asked whether in Mr. McNamara’s opinion the board, including Mr. Stewart, would be receptive to an acquisition proposal from SCI. Mr. McNamara informed the board that he responded to Mr. Ryan that he believed the board, including Mr. Stewart, was always receptive to proposals in the best interests of the Company’s shareholders, and that in his opinion the appropriate manner in which to communicate SCI’s interest was by a letter to the board, preceded by a call to Mr. Stewart in order to let Mr. Stewart know the letter was forthcoming.

At the December 12, 2012 meeting, the board discussed the Company’s prospects on a standalone basis, strategic initiatives, including acquisition opportunities, being pursued by the Company, and additional information the board wanted to review in order to consider the SCI proposal further, including a legal evaluation of potential antitrust issues. The board discussed potential financial advisors, and was favorably inclined towards Goldman Sachs, due to its experience from serving as financial advisor in connection with the SCI proposal in 2008 and due to the board’s view regarding Goldman Sachs’ independence, assuming the board concluded that Goldman Sachs remained independent as it was in 2008. Jones Walker LLP, regular outside counsel to the Company, reviewed the board’s fiduciary duties under the circumstances.

The board noted that if Mr. Stewart voted against a merger proposal at a shareholder meeting, it would not be approved, due to his beneficial ownership of more than one-third of the Company’s voting power, putting him in a unique position in relation to the Company’s other shareholders. Under Louisiana law and the Company’s organizational documents, a merger would require the approval of two-thirds of the voting power present in person or represented by proxy and entitled to vote. The board unanimously voted to form a special committee of the board, consisting solely of independent directors, who were not members of management and excluding Mr. Stewart in order to conduct the process of considering the SCI proposal, and other strategic initiatives, including acquisitions, that were being pursued or that may be pursued by the Company. The Board unanimously appointed Mr. Ashton Ryan and Messrs. Elstrott, McDonald, Patron and Saer to serve on the special committee,

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and Mr. Saer to serve as Chairman of the special committee. The board authorized the special committee to hire a financial advisor and any other advisors that the special committee in its sole discretion deemed appropriate, and to pay its advisors compensation as the special committee in its sole discretion deemed appropriate.

The board authorized Mr. Kitchen to advise Mr. Ryan that the board had met, considered the SCI proposal, and concluded that it needed more time to assess the proposal as well as other alternatives, with a goal of providing feedback after January 1, 2013.

At the direction of the members of the special committee, Mr. Saer, Mr. Kitchen, Lewis J. Derbes, Jr., the Company’s Senior Vice President, Chief Financial Officer and Treasurer, and representatives of Jones Walker confirmed their conclusion with respect to Goldman Sachs’ independence and negotiated the terms of an engagement letter between Goldman Sachs and the special committee.

The board and special committee met on January 10, 2013 to consider the SCI proposal further. In addition to all of the directors, present at the meeting were Mr. Derbes, Lisa T. Winningkoff, the Company’s Senior Vice President, Senior Administrative Officer and Corporate Secretary, Mr. McNamara and representatives of Goldman Sachs and Jones Walker. Mr. McNamara and the representatives of Goldman Sachs were then excused from the meeting and Jones Walker reviewed potential antitrust considerations in a business combination between SCI and the Company.

Thereafter, Mr. McNamara and the representatives of Goldman Sachs rejoined the meeting. Mr. Derbes reviewed management’s financial projections for fiscal 2013 through 2017. Mr. Derbes also reviewed the projected impact of a potential large acquisition that the Company had considered earlier in the year, although the Company had not been willing to pay the price required by the potential seller. The representatives of Goldman Sachs then reviewed certain financial information relating to the SCI proposal, and financial analyses of an illustrative significant stock repurchase program or leveraged buyout by a private equity or financial buyer, as well as the potential ability of SCI to finance a proposed acquisition of the Company at various prices.

The board discussed the SCI proposal and existing and potential business strategies of the Company. The board considered potential antitrust and financing risks to closing a transaction with SCI, and potential damage to the Company’s business should a transaction be announced but not ultimately closed. The board concluded that the special committee should meet to make a decision regarding how the Company would respond to the SCI proposal. Nonetheless, it was the unanimous view of the board that the Company should tell SCI that, while the Company was not for sale, and the proposed price was very inadequate, the Company was willing to allow SCI access to limited additional information, subject to SCI entering into an acceptable confidentiality and standstill agreement, in order to further refine its proposal, with the understanding that the Company would, if it were to entertain a transaction, expect to receive a substantially higher price, and to assume no financing risk and very little, if any, antitrust risk.

Prior to convening the special committee meeting, the representatives of Goldman Sachs left the board meeting, and Messrs. Kitchen and Derbes discussed Goldman Sachs’ qualifications and the terms of the proposed engagement letter between Goldman Sachs and the special committee. Messrs. Kitchen and Derbes said that after investigation they were satisfied that Goldman Sachs was independent. The board left further discussion of the special committee’s financial advisor to the special committee.

The board further discussed the role of the special committee and determined that it was desirable to more specifically delineate the special committee’s authority. The board empowered the special committee to have the full power of the board to explore and consider any and all strategic alternatives, and to determine whether and when to submit any proposal for a strategic alternative to the board, along with the special committee’s recommendations with respect to any such proposal. If pursuing a particular strategic alternative was approved by the board, the special committee was authorized to enter into negotiations regarding that strategic alternative, along with the appropriate executive officers of the Company and the special committee’s advisors, and to terminate any such negotiations. The special committee was not given the authority to approve the execution and

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delivery of any definitive agreement for a strategic alternative, but rather was directed to submit a recommendation with respect to any definitive agreement to the board. If the interests of the holders of Class A common stock and Class B common stock diverged, the special committee was to determine what was in the best interests of the holders of Class A common stock. The board also reaffirmed the special committee’s authority to retain and compensate its own advisors.

The special committee then met with only Messrs. Kitchen and Derbes, Ms. Winningkoff and representatives of Jones Walker present. The special committee further discussed the SCI proposal and other strategic alternatives, and agreed with the board’s view regarding the Company’s response to SCI’s proposal. Mr. Kitchen was directed to communicate the Company’s response to SCI, subject to Mr. Saer contacting Mr. Stewart and confirming that Mr. Stewart continued to be supportive of the response. The special committee also discussed the proposed engagement letter with Goldman Sachs, authorized Mr. Saer to work with Mr. Kitchen to finalize the open items within parameters set by the special committee, and authorized Mr. Saer to execute and deliver the engagement letter on behalf of the special committee.

On January 14, 2013, the special committee met and discussed the potential large acquisition by the Company that had been discussed previously, as well as the Goldman Sachs engagement letter. On January 21, 2013, as directed by the special committee, Mr. Kitchen called Mr. Ryan and communicated the view of the board and special committee as determined at the January 10, 2013 meetings. On February 1, 2013, the special committee and Goldman Sachs executed and delivered the Goldman Sachs engagement letter.

The Company and SCI proceeded to negotiate the terms of a confidentiality and standstill agreement. The special committee met on January 29, 2013 and February 4, 2013 and discussed the potential large acquisition by the Company and the proposed confidentiality and standstill agreement with SCI. The Company and SCI entered into the confidentiality and standstill agreement on February 18, 2013.

Thereafter, the Company provided agreed-upon diligence information to SCI. On February 25, 2013, executives of the Company, an outside tax advisor to the Company, a representative of Jones Walker, and executives of SCI, including its general counsel, met to discuss the diligence information.

On March 5, 2013, the board received a letter from SCI increasing the proposed cash consideration to $11.50 per share. On March 6, 2013, SCI sent Mr. Kitchen a draft merger agreement and voting agreement to be executed by Mr. Stewart. On March 6, 2013, the special committee met, along with Messrs. Kitchen and Derbes, and representatives of Goldman Sachs and Jones Walker. Mr. Derbes said the large acquisition candidate had agreed to permit representatives of Goldman Sachs to review diligence information previously reviewed by the Company and to provide updated financial information. Representatives of Goldman Sachs reviewed certain financial information relating to SCI’s $11.50 per share proposal. The special committee directed Mr. Kitchen to communicate to Mr. Ryan that the $11.50 per share proposal was also inadequate, and that, particularly in light of the Company’s fiscal first quarter 2013 results, the Company intended to continue focusing on executing its long-term strategic plan. Mr. Kitchen called Mr. Ryan to communicate the decision of the special committee. Mr. Ryan suggested that both companies’ management and investment bankers meet to discuss the differing views on valuation, and Mr. Kitchen responded that he was not authorized to do anything other than communicate the special committee’s position.

On March 28, 2013, the special committee met with Messrs. Kitchen and Derbes, Ms. Winningkoff, and representatives of Goldman Sachs and Jones Walker. Mr. Kitchen said that the large acquisition candidate had provided Goldman Sachs with access to diligence information previously reviewed by the Company, and had provided the Company and Goldman Sachs with updated financial information. The representatives of Goldman Sachs reviewed the SCI proposal and certain financial information relating to the potential large acquisition by the Company. In addition, the special committee authorized management and Goldman Sachs to meet with management of SCI and its financial advisors, and also to gather additional information and perform further analysis with respect to the potential large acquisition by the Company.

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The board held a regular meeting on April 2, 2013. At the meeting, representatives of Goldman Sachs reviewed with the board certain financial information relating to the possible SCI transaction. The representatives of Goldman Sachs also reviewed certain financial information relating to the potential large acquisition by the Company and the price desired by the seller in such potential transaction. The board supported the decision of the special committee that the Company further pursue both potential opportunities. The board also discussed the Company’s recent financial results, cremation initiative, best-in-class sales initiative and two other potential acquisitions, and increased the Company’s quarterly dividend to $0.045 per share.

On April 8, 2013, Messrs. Kitchen and Derbes spoke with Mr. Ryan and Eric D. Tanzberger, SCI’s Chief Financial Officer, by phone and answered additional questions regarding the Company’s diligence information.

On April 9, 2013, the board received a letter from SCI increasing its proposal to $13.00 per share in cash.

The board held a special teleconference meeting on April 11, 2013 at which it discussed, along with representatives of Goldman Sachs and Jones Walker, the SCI proposal and the potential large acquisition by the Company. The board decided to meet in person on April 18, 2013 after the annual meeting of shareholders in order to consider these matters further.

In addition to all of the directors, present at the April 18, 2013 board meeting were Mr. Derbes, Ms. Winningkoff, Mr. McNamara and representatives of Goldman Sachs and Jones Walker. The representatives of Goldman Sachs reviewed certain financial information relating to the SCI proposal. Jones Walker provided a high-level review of the draft merger agreement and voting agreement provided by SCI on March 6, 2013. SCI proposed to require Mr. Stewart to enter into a voting agreement with SCI at the time SCI entered into a merger agreement with the Company, agreeing to vote his shares in favor of the merger agreement. Jones Walker identified several key issues for the board to consider relating to the merger agreement, primarily related to the antitrust and financing contingencies, the board’s ability to respond to an unsolicited transaction after entering into the merger agreement, and remedies for breach by SCI. Jones Walker also reviewed the board’s fiduciary duties under the circumstances. Jones Walker said it had discussed the proposed merger agreement and voting agreement with Latham & Watkins LLP, counsel to Mr. Stewart, which had views consistent with Jones Walker regarding the key issues in the merger agreement.

The board discussed whether to authorize Goldman Sachs to initiate calls to other parties that could have an interest in acquiring the Company. The board discussed risks associated with such calls, including the risk of a leak disruptive to the market and employees that could jeopardize negotiations. The board believed it had very good knowledge of the industry, and that SCI was likely to be willing and able to pay the highest price for the Company, particularly in light of the fact that other potential acquirors within or outside the industry were unlikely to be able to achieve the significant synergies that would be available to SCI and the fact that no other bidders had come forward following the public announcement of SCI’s interest in the Company in 2008. The board then considered the likelihood that a private equity firm would be willing to pay a price for the Company in excess of the price proposed by SCI in light of financial information presented by representatives of Goldman Sachs at the January 10, 2013 board meeting and concluded that private equity firms were unlikely to be interested in a transaction with the Company at the price level proposed by SCI.

Mr. Stewart advised the board that he had a call with Mr. Ryan and told Mr. Ryan he was keeping an open mind about the proposal. Mr. Stewart expressed to the board that he had concerns regarding a third party’s social and philosophical approach to post-closing operation of the Company’s facilities, given his and his family’s long history with the Company. As a result, Mr. Stewart desired to explore possibilities related to this, although he would not engage in any discussions with SCI about these matters without the special committee’s approval. Mr. Stewart also said he believed that the potential large acquisition by the Company would not move forward because the seller’s price expectations continued to be more than the Company could financially justify.

Jones Walker suggested that the special committee meet privately, and everyone left the room except for members of the special committee and the Jones Walker representatives. The special committee concluded that if the board were to decide to sell the Company, the board would desire to obtain the best price and terms

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reasonably available to all shareholders and ensure that the interests of all shareholders are upheld. The special committee decided to request that Mr. Stewart and SCI not engage in any discussions prior to the time a merger agreement was fully negotiated. In addition, the special committee decided that it would require SCI to include a representation in any merger agreement to the effect that it had not provided any special consideration to Mr. Stewart. The special committee asked Messrs. Stewart and McNamara to join the meeting, and communicated the decision of the special committee, which Mr. Stewart accepted.

Mr. Kitchen and the representatives of Goldman Sachs rejoined the meeting and the board meeting reconvened. Mr. Elstrott related the decision of the special committee. The board discussed the response to SCI’s proposal and directed Mr. Kitchen to seek a meeting with Mr. Ryan, to communicate that the board would be willing to support a transaction at a $14.50 per share price, with the significant issues identified regarding the merger agreement resolved in the Company’s favor.

Messrs. Kitchen and Ryan met on April 22, 2013 and reviewed and discussed the Company’s $14.50 per share price proposal and significant issues with the merger agreement. Mr. Ryan later communicated to Mr. Kitchen that SCI was not willing to increase its $13.00 per share proposal, but was willing to accommodate the Company on many of the other merger agreement issues.

Mr. Kitchen updated the special committee on these discussions at a meeting of the special committee on April 26, 2013. The special committee decided that, prior to finalizing a recommendation to the board, Messrs. Saer and Kitchen should speak with Messrs. Stewart and McNamara to allow Mr. Stewart the opportunity to provide his views to the special committee. At a special committee meeting on April 29, 2013, Mr. Kitchen reported that he and Mr. Saer spoke with Messrs. Stewart and McNamara. Earlier that morning, Mr. McNamara told Mr. Kitchen that determination of pricing was the role of the special committee, and that Mr. Stewart was comfortable with $13.00 per share and was also comfortable with the special committee seeking a higher price. Mr. McNamara said that after a transaction was fully negotiated, but before Mr. Stewart would sign the voting agreement, Mr. Stewart wanted the opportunity to meet Mr. Ryan to discuss social issues and philosophy with respect to the Company’s operations. After discussion, the special committee directed Mr. Kitchen to contact Mr. Ryan with a $13.75 per share price proposal, and to require that the merger agreement contain the Company’s proposed remedies for breach by SCI.

Mr. Kitchen communicated these terms to Mr. Ryan on April 30, 2013, and Mr. Ryan responded on May 1, 2013 to Mr. Kitchen, offering to support to the SCI board increasing the SCI proposal to $13.25 per share if Stewart’s board approved such price, and agreeing to Delaware law and a specific performance remedy, but not the Company’s proposed approach to damages. The special committee met on May 1, 2013 and directed Mr. Kitchen to continue to negotiate for the $13.75 per share price, and to work with Jones Walker and Goldman Sachs to negotiate other economic terms of the merger agreement, including the proposed divestiture cap, Company termination fee, SCI reverse termination fee for failure to obtain antitrust approvals within the divestiture cap for antitrust related divestitures mandated by the FTC, ticking fee, outside date, and damages remedy. The special committee met on May 3 and 6, 2013 and received updates from, and gave guidance to, Mr. Kitchen regarding these negotiations. At the May 6, 2013 meeting, the special committee concluded, after consultation with representatives of Goldman Sachs, that it was unnecessary to contact other potential buyers before entering into the merger agreement, because it was unlikely another qualified bidder would be willing to pay a higher premium, given the strategic nature and synergies of a potential merger with SCI, and because a pre-signing market check would increase the possibility of a leak, which would be disruptive to employees, harmful to the Company and put the negotiations with SCI at risk. In addition, the special committee was comfortable after consultation with Jones Walker and Goldman Sachs that the merger agreement would allow the board to respond appropriately to an unanticipated superior proposal that might be made after signing, and that the proposed $25 million breakup fee was not so significant as to deter an interested bidder.

On May 7, 2013, the special committee met, with Messrs. Kitchen and Derbes, Ms. Winningkoff, and representatives of Goldman Sachs and Jones Walker present. Mr. Kitchen reported on the negotiations with Mr. Ryan. Mr. Kitchen said that SCI continued to refuse to increase the $13.25 per share proposal. However,

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Mr. Kitchen said Mr. Ryan had agreed on the following principles: (i) an SCI reverse termination fee for antitrust and financing failures (other than as a result of a breach by SCI) of $75 million; (ii) a ticking fee of 6% per annum payable by SCI starting at the first outside date, with an extended outside date of nine months; (iii) merger agreement governed by Delaware law, with an express specific performance remedy; (iv) a specified divestiture cap based on EBITDA, subject to further review by antitrust counsel; and (v) a Company termination fee of $25 million. Mr. Kitchen said SCI had also agreed to uncapped damages. The special committee discussed SCI’s proposal, and unanimously determined to submit a recommendation to the board that the Company proceed to negotiate the definitive merger agreement with a $13.25 per share price and other terms consistent with those discussed.

The board met on May 7, 2013, shortly after the special committee meeting adjourned. In addition to board members, also present were Mr. Derbes, Ms. Winningkoff, Mr. McNamara and representatives of Goldman Sachs and Jones Walker. Mr. Saer advised the board of the recommendation of the special committee, and Mr. Kitchen reviewed the current status of negotiations with SCI. Jones Walker reported that the special committee had concluded that a pre-signing market check was not necessary or appropriate under the circumstances, weighing the low likelihood of a higher bid emerging against the potential harm to the Company and disruption to the SCI negotiations that would result from a leak. It was noted that SCI’s offer in 2008 to acquire the Company was public for several months prior to being withdrawn and no other interested bidders contacted the Company during that time. Mr. Stewart said that, based on his industry experience, he also did not believe there was likely to be a party willing and able to pay a higher price than SCI.

The board discussed the proposed transaction. Mr. Stewart said he was willing to vote in favor of the Company moving forward to negotiate the definitive merger agreement on the terms discussed, and reiterated that he wanted the opportunity to meet with Mr. Ryan after the merger agreement was fully negotiated to discuss social and philosophical matters regarding the Company’s operations with Mr. Ryan before signing the voting agreement. After further discussion, the board unanimously approved the special committee’s recommendation directing Mr. Kitchen to proceed to negotiate the definitive merger agreement at $13.25 per share in cash for all outstanding shares, and with other terms consistent with those described.

Mr. Kitchen and representatives of Jones Walker, and Mr. Ryan and representatives of Shearman & Sterling LLP, counsel to SCI, proceeded to negotiate the terms of the merger agreement and related financing commitment letter. Mr. Stewart and his counsel, Latham & Watkins, proceeded to negotiate the terms of the voting agreement with SCI and Shearman & Sterling. Jones Walker and Latham & Watkins kept one another apprised of the status of negotiations on the merger agreement and voting agreement, respectively. SCI and its counsel conducted further due diligence. Mr. Kitchen kept Mr. Saer, Chairman of the special committee, apprised of the status of the negotiations. SCI, Mr. Stewart and the Company agreed that the shares covered by the voting agreement would not exceed 29.99% of the Company’s aggregate voting power.

The special committee met on May 23, 2013. In addition to the special committee members, present at the meeting were Messrs. Kitchen and Derbes, Ms. Winningkoff, and representatives of Goldman Sachs and Jones Walker. Mr. Derbes reviewed the negotiations surrounding the financing commitment letter and said that all issues had been resolved to his satisfaction, subject to reviewing revised documentation. Mr. Kitchen reported on the status of open merger agreement terms, which primarily included the divestiture cap, language regarding the Company’s damages remedy upon an SCI breach, and SCI’s insistence on expense reimbursement up to $10 million if shareholders do not approve the merger agreement at the special meeting. SCI had agreed to forgo an earlier request for expense reimbursement in other circumstances, subject to an increase in the Company termination fee to $27.5 million. After discussion, the representatives of Goldman Sachs left the meeting, and Jones Walker discussed the antitrust provisions of the merger agreement. The special committee concluded that the expense reimbursement provision would not inappropriately coerce the Company’s shareholders in deciding how to vote on the merger agreement. The special committee gave Mr. Kitchen direction regarding the resolution of the remaining open items.

In the morning on May 24, 2013, an analyst disseminated a research report speculating about a potential transaction involving SCI and the Company. The price and volume of trading in the Company’s Class A common

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stock increased significantly. The special committee met at 11:30 a.m. and 5:00 p.m. on May 24, 2013, and at the 5:00 p.m. meeting, Mr. Kitchen reported that the remaining significant substantive items appeared to be resolvable, subject to definitive documentation, such that he expected the Company to be able to hold a special committee and board meeting on May 28, 2013, to consider the definitive agreements.

On May 25, 2013, Mr. Kitchen advised Mr. McNamara that he believed the material terms of the merger agreement, financing commitment and voting agreement had been fully resolved. Mr. McNamara called Mr. Ryan to request that Mr. Ryan meet with Mr. Stewart, and a meeting was arranged for May 28, 2013. Mr. Ryan met with Mr. Stewart in New Orleans on the morning of May 28, 2013 to discuss social issues and philosophy regarding the Company’s operations, which discussions did not result in any agreements or commitments from SCI with respect to Company operations.

At 3:00 p.m. on May 28, 2013, the special committee met jointly with the board to consider the proposed definitive merger agreement and related financing commitment letter and voting agreement. All members of the board were present in person. Also present in person were Mr. Derbes, Ms. Winningkoff, Mr. McNamara, representatives of Goldman Sachs and Jones Walker, and a representative of Latham & Watkins, counsel to Mr. Stewart. Jones Walker reviewed in detail the terms of the agreements, referring to the copies of the agreements included in the board materials distributed in advance of the meeting, and to the accompanying written summaries of the agreements. Mr. Derbes reviewed the financial terms of SCI’s financing commitment letter. Mr. McNamara, and the representatives of Goldman Sachs and Latham & Watkins left the meeting, and Jones Walker discussed the antitrust provisions of the merger agreement. Mr. McNamara and the representatives of Goldman Sachs and Latham & Watkins rejoined the meeting. Mr. Derbes discussed the preliminary financial results for the Company’s second quarter and six months ended April 30, 2013. He said that in management’s opinion, these results did not warrant any changes in management’s projections provided to the board and Goldman Sachs in connection with the January 10, 2013 board meeting. Representatives of Goldman Sachs then presented certain financial analyses of the proposed merger and delivered an oral opinion to the special committee, which was confirmed by delivery of a written opinion dated May 28, 2013, that, as of such date and based upon and subject to the factors and assumptions set forth therein, the $13.25 per share in cash to be paid to the holders of outstanding shares of Class A common stock was fair from a financial point of view to such holders. See “—Opinion of Goldman, Sachs & Co. as Financial Advisor to the Special Committee”. After discussion, the board meeting was temporarily adjourned and the special committee met and unanimously resolved to recommend that the board approve the merger agreement and voting agreement and that the board recommend that the Company’s shareholders approve the merger agreement. The board meeting reconvened, and the board unanimously accepted the recommendation of the special committee, approved the merger agreement and voting agreement and recommended that the Company’s shareholders approve the merger agreement.

Later that evening, the relevant parties executed and delivered the merger agreement and voting agreement, and on the morning of May 29, 2013 the Company and SCI publicly announced the transaction.

Reasons for the Merger and Recommendation of the Board of Directors

Our board of directors, by unanimous vote of its members at a meeting duly called, and based on the unanimous recommendation of a special committee of the board consisting of all directors other than Messrs. Stewart and Kitchen, determined that the merger is fair to, and in the best interests of, the Company and our shareholders, unanimously approved the merger agreement and voting agreement and recommended that our shareholders vote “FOR” the approval of the merger agreement. In the course of reaching its decision to recommend that our shareholders vote “FOR” the approval of the merger agreement, the board considered the process and deliberations of the special committee, consulted with the special committee’s financial advisor and Jones Walker, reviewed a significant amount of information and considered a number of factors, including without limitation the following:

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In the course of its deliberations, the board of directors also considered a variety of risks and other countervailing factors concerning the merger agreement and the merger, including without limitation the following:

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The foregoing discussion of the factors considered by the board of directors is not intended to be exhaustive, but does set forth the principal factors considered by the board. The board collectively reached the unanimous conclusion to recommend the approval of the merger agreement in light of the various factors described above and other factors that each member of the board believed were appropriate. In view of the wide variety of factors considered by the board in connection with its evaluation of the merger and the complexity of these matters, the board did not consider it practical, and did not attempt, to quantify, rank or otherwise assign relative weights to the specific factors it considered in reaching its decision and did not undertake to make any specific determination as to whether any particular factor, or any aspect of any particular factor, was favorable or unfavorable to its ultimate determination. Rather, the board made its recommendation based on the totality of information presented to it and the investigation conducted by it, and on the recommendation of the special committee. In considering the factors discussed above, individual directors may have given different weights to different factors.

After evaluating these factors and receiving the recommendation of the special committee, our board of directors unanimously determined that the merger is fair to, and in the best interests of, the Company and our shareholders. Accordingly, our board of directors unanimously approved the merger agreement and recommended that our shareholders approve the merger agreement.

The board of directors unanimously recommends that you vote “FOR” the approval of the merger agreement.

Opinion of Goldman, Sachs & Co. as Financial Advisor to the Special Committee

Goldman Sachs rendered its opinion to the special committee, that, as of May 28, 2013, and based upon and subject to the factors and assumptions set forth in its opinion, the $13.25 per share in cash to be paid to the holders of outstanding shares of Class A common stock pursuant to the merger agreement was fair from a financial point of view to such holders. Goldman Sachs did not express any opinion with respect to the consideration being paid to the holders of Class B common stock or any additional cash consideration that may be paid pursuant to the merger agreement.

The full text of the written opinion of Goldman Sachs, dated May 28, 2013, 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 to this proxy statement. Goldman Sachs provided its advisory services and opinion for the information and assistance of the special committee in connection with its consideration of the merger. Goldman Sachs’ opinion is not a recommendation as to how any holder of Class A 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:

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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. In addition, Goldman Sachs 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 deathcare industry and in other industries; and performed such other studies and analyses, and considered such other factors, as it deemed appropriate.

For purposes of rendering the opinion described above, Goldman Sachs, with the special committee’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, Goldman Sachs, without assuming any responsibility for the independent verification thereof. In that regard, Goldman Sachs assumed with the consent of the special committee that the projections 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 off-balance-sheet assets and liabilities) of the Company or any of its subsidiaries and Goldman Sachs was not furnished with any such evaluation or appraisal.

Goldman Sachs assumed that all governmental, regulatory or other consents and approvals necessary for the consummation of the transaction will be obtained without any adverse effect on the expected benefits of the transaction in any way meaningful to Goldman Sachs’ analysis. Goldman Sachs also assumed that the transaction 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 Goldman Sachs’ analysis.

Goldman Sachs’ opinion did not address the underlying business decision of the Company to engage in the transaction, or the relative merits of the transaction as compared to any strategic alternatives that may be available to the Company; nor did it address any legal, regulatory, tax or accounting matters. Goldman Sachs was not requested to solicit, and did not solicit, interest from other parties with respect to an acquisition of, or other business combination with, the Company or any other alternative transaction. Goldman Sachs’ opinion addressed only the fairness from a financial point of view to the holders of Class A common stock, as of the date of the opinion, of the $13.25 per share in cash to be paid to such holders pursuant to the merger agreement. Goldman Sachs did not express any view on, and its opinion did not address, any other term or aspect of the merger agreement or transaction 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 transaction, including, any allocation of the aggregate consideration to be paid pursuant to the merger agreement, the fairness of the transaction to, or any consideration received in connection therewith by, the holders of any other class of securities, including the Company’s Class B common stock, 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 transaction, whether relative to the $13.25 per share in cash to be paid to the holders of Class A common stock pursuant to the merger agreement or otherwise. Goldman Sachs did not express any opinion as to the impact of the transaction on the solvency or viability of the Company or SCI or the ability of the Company or SCI to pay their respective obligations when they come due. Goldman Sachs’ opinion was 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 the opinion and Goldman Sachs assumed no responsibility for updating, revising or reaffirming its opinion based on circumstances, developments or events occurring after the date of its opinion. Goldman Sachs’ opinion was approved by a fairness committee of Goldman Sachs.

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The following is a summary of the material financial analyses delivered by Goldman Sachs to the special committee 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 May 23, 2013 (the last trading day prior to publication of a research report speculating on a potential transaction involving the Company and SCI) and is not necessarily indicative of current market conditions.

Historical Stock Trading Analysis. Goldman Sachs reviewed the historical trading prices and volumes for the shares of Class A common stock for the ten-year period ended May 23, 2013. In addition, Goldman Sachs analyzed the $13.25 per share in cash to be paid to the holders of Class A common stock pursuant to the merger agreement in relation to the closing price of the shares of Class A common stock on May 23, 2013, the high and low prices of the shares of Class A common stock for the 52-week period ended May 23, 2013, and the volume-weighted average prices, referred to as VWAP, of the shares of Class A common stock during the 30-day, six-month, one-year, three-year, five-year, and ten-year periods ended May 23, 2013.

This analysis indicated that the $13.25 per share of Class A common stock to be paid to the holders of shares of Class A common stock pursuant to the merger agreement represented:

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Selected Companies Analysis. Goldman Sachs reviewed and compared certain financial information, ratios and public market multiples for the Company to corresponding financial information, ratios and public market multiples for the following publicly traded companies in the deathcare industry, which we refer to as the “selected companies”:

Although none of the selected companies is directly comparable to the Company, the companies included were chosen because they are publicly-traded companies with operations that, for purposes of analysis, may be considered similar to certain operations of the Company.

Goldman Sachs calculated and compared various financial multiples and ratios for the selected companies based on financial data as of May 23, 2013, information obtained from public filings and Institutional Brokers’ Estimate System, referred to as IBES, estimates. The multiples and ratios of the Company were based on financial data as of May 23, 2013, the merger consideration of $13.25 per share, the projections and IBES estimates and assume 85.5 million outstanding shares of Class A and Class B common stock, 4.7 million outstanding options with a weighted average strike price of $6.51 and net debt of the Company of $253.4 million as of January 31, 2013, based upon information contained in the Company’s Quarterly Report on Form 10-Q for the quarter ended January 31, 2013. With respect to each of the selected companies and the Company, Goldman Sachs calculated:

For purposes of these calculations, Goldman Sachs utilized an equity value for each selected company derived by multiplying the number of fully-diluted outstanding shares of such company as reported in its most recent SEC filings by such company’s closing share price on May 23, 2013. By adding the consolidated net indebtedness amount of each selected company as most recently publicly reported by such company to the equity value of such company derived from these calculations, Goldman Sachs determined an enterprise value for each selected company. The EPS amounts for the selected companies were calculated using median IBES research analysts’ estimates of EPS for each selected company as of May 23, 2013. Calculations for Hillenbrand were pro forma for the acquisition of Coperion Capital GmbH.

The results of these analyses, together with the multiple of EV to LTM EBITDA for the Company based on the projections, and as implied by the proposed transaction, are summarized as follows:

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Illustrative Present Value of Future Share Price Analysis. Goldman Sachs performed an illustrative analysis of the implied present value of the future price per share of Class A common stock, using the projections. This analysis is designed to provide an indication of the implied present value of a theoretical future value of a company’s equity as a function of such company’s estimated future earnings and its assumed price to future earnings multiples, plus dividends. Goldman Sachs first calculated the illustrative future values per share of the Class A common stock for the fiscal years 2013 through 2017 by applying price to 12-month forward EPS multiples ranging from 16.5x to 17.5x to EPS for the Company’s fiscal years 2013 through 2017 derived from the projections. The resulting values were then discounted to present value as of October 31, 2013 using a discount rate of 12.0%, reflecting an estimate of the Company’s cost of equity. Goldman Sachs then added the present value as of October 31, 2013 of future dividends projected by Company management to be paid over such period using the same discount rate. This analysis resulted in an illustrative range of implied present values of $8.89 to $11.27 per share of Class A common stock.

Illustrative Discounted Cash Flow Analysis. Goldman Sachs performed an illustrative discounted cash flow analysis to determine a range of implied equity values per share of Class A common stock based on projected stand-alone future unlevered cash flows, using the projections and assuming a total of 85.5 million outstanding shares of Class A and Class B common stock, 4.7 million outstanding options with a weighted average strike price of $6.51 and net debt of the Company of $253.4 million as of January 31, 2013, based upon information contained in the Company’s Quarterly Report on Form 10-Q for the quarter ended January 31, 2013. Goldman Sachs calculated indications of the net present value of unlevered free cash flows for the Company for the years 2014 through 2017 using discount rates ranging from 8.0% to 10.0%, reflecting estimates of the Company’s weighted average cost of capital. Goldman Sachs calculated illustrative terminal values for the Company by applying terminal EV/EBITDA multiples ranging from 7.5x to 9.5x to the Company’s estimated EBITDA for the fiscal year ended 2017. The terminal year cash flow forecasts were pro forma for a full year of cash flow from management initiatives. These illustrative terminal values were then discounted using discount rates ranging from 8.0% to 10.0%. This analysis resulted in a range of illustrative implied present values of $9.73 to $13.38 per share of Class A common stock.

Selected Transactions Analysis. Goldman Sachs analyzed certain publicly available information relating to the following selected transactions involving companies in the deathcare industry announced in the last ten years:

For each of the selected transactions, Goldman Sachs calculated and compared EV as a multiple of the target company’s LTM EBITDA. While none of the selected transactions or the selected companies that participated in the selected transactions are directly comparable to the merger or 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 operations of the Company.

The following table presents the results of this analysis:

Premia Paid Analysis. Goldman Sachs reviewed and analyzed the acquisition premia for announced all-cash mergers and acquisitions transactions between $1 billion and $3 billion involving United States publicly-traded targets from January 2008 to May 23, 2013, calculated relative to (i) the target’s closing share price one day prior to announcement; and (ii) the target’s closing share price on the day that was four weeks prior to announcement, based on publicly available information.

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The following table presents the results of this analysis:

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, SCI or the transaction.

Goldman Sachs prepared these analyses for purposes of Goldman Sachs’ providing its opinion to the special committee that, as of May 28, 2013, the $13.25 per share in cash to be paid to the holders of Company Class A common stock pursuant to the merger agreement was fair from a financial point of view to such holders. 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, SCI, 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 SCI and, consistent with the recommendation of the special committee was approved by the Company’s board of directors. Goldman Sachs provided advice to the special committee during these negotiations. Goldman Sachs did not, however, recommend any specific amount of consideration to the Company, the special committee or the Company’s 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 special committee was one of many factors taken into consideration by the special committee in making its determination to recommend that the Company’s board of directors 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 its opinion and is qualified in its entirety by reference to the full text of the written opinion of Goldman Sachs attached as Annex B.

Goldman Sachs and its affiliates are engaged in advisory, underwriting 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 in which they invest 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, SCI, any of their respective affiliates and third parties, including affiliates of Frank B. Stewart, Jr., a significant shareholder of the Company, which we refer to as the Stewart Entities, or any currency or commodity that may be involved in the transaction for the accounts of Goldman Sachs and its affiliates and employees and their customers. Goldman Sachs may in the future provide investment banking services to the Company, SCI, the Stewart Entities and their respective affiliates for which the Investment Banking Division of Goldman Sachs may receive compensation.

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The special committee 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 and because of the special committee’s determination that Goldman Sachs was independent. Pursuant to a letter agreement, dated February 1, 2013, the special committee engaged Goldman Sachs to act as its financial advisor in connection with a potential transaction involving SCI. Pursuant to the terms of the engagement letter, the Company has agreed to pay Goldman Sachs a fee of approximately $11 million, of which approximately $9.75 million is contingent upon consummation of the transaction. In addition, the Company has agreed to reimburse Goldman Sachs for 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.

Effects on Stewart if the Merger is Not Completed

If the merger agreement is not approved by our shareholders or if the merger is not completed for any other reason, shareholders will not receive any payment for their shares in connection with the merger. Instead, we will remain an independent public company and our Class A common stock will continue to be listed and traded on The NASDAQ Global Select Market. In addition, if the merger is not completed, we expect that management will operate the business in a manner similar to that in which it is being operated today and that our shareholders will continue to be subject to the same risks and opportunities as they currently are, as well as general industry, economic and market conditions. Further, if the merger is not completed, the trading price of our Class A common stock may decrease, and such decrease may be substantial, at least in the short term. Accordingly, if the merger is not completed, there can be no assurance as to the effect of these risks and opportunities on the future value of your shares. If the merger is not completed, our board of directors will from time to time evaluate and review the business operations, properties, dividend policy and capitalization of Stewart, will make such changes as are deemed appropriate and will continue to seek to identify strategic alternatives to enhance shareholder value. If the merger agreement is not approved by our shareholders or if the merger is not completed for any other reason, there can be no assurance that any other transaction acceptable to Stewart will be offered or become available, or that our business, prospects or results of operations will not be adversely impacted.

If shareholders do not approve the merger agreement at the special meeting, we will be required to reimburse SCI for all out-of-pocket fees and expenses incurred or paid by or on behalf of SCI (including all fees and expenses of legal counsel, accountants, investment banks, financing sources, experts and consultants) incurred in connection with or related to the authorization, preparation, negotiation, execution and performance of the merger agreement, filings under the HSR Act, and financing, up to $10.0 million.

If we later become obligated to pay the termination fee to SCI after paying expenses to SCI, the amount of expenses we previously paid to SCI will be credited toward our payment of the termination fee. The maximum termination fee is $27.5 million. See the section entitled “The Merger Agreement (Proposal 1)—Termination Fee” beginning on page 66 of this proxy statement for a discussion of the circumstances under which the termination fee would be required to be paid.

Delisting and Deregistration of Stewart Common Stock

If the merger is completed, our Class A common stock will be delisted from The NASDAQ Global Select Market and deregistered under the Securities Exchange Act of 1934, as amended (the Exchange Act). After completion of the merger, we will no longer be required to file periodic reports with the SEC on account of our Class A common stock.

Financing of the Merger

Stewart and SCI estimate that the total amount of funds required to complete the merger and pay related fees and expenses will be approximately $1.6 billion, including $200.0 million of Stewart’s 6.50% Senior Notes due 2019, referred to as the 2019 Senior Notes, which as a result of the consent solicitation described below, are expected to remain outstanding upon the closing of the merger.

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With respect to the Company’s 2019 Senior Notes, absent the waiver described below, the merger would have constituted a change of control under the indenture governing the notes, requiring the Company, after completion of the merger, to make an offer to repurchase all of the notes at an offer price in cash equal to 101% of the aggregate principal amount repurchased plus accrued and unpaid interest to the date of purchase (the change of control offer). As required by the merger agreement, at the request and expense of SCI, Stewart commenced a consent solicitation on June 6, 2013 seeking the consents of holders of the notes required under the indenture to amend the indenture to (i) waive the requirement for the change of control offer (the waiver) upon completion of the merger and (ii) amend the indenture to state that the Company’s obligations to deliver quarterly and annual financial information and other reports to the trustee under the indenture will be satisfied by delivery of SCI’s filings with the SEC for so long as SCI guarantees the notes (the amendment). The closing of the merger was not conditioned upon the success of the consent solicitation. The terms of the consent solicitation were supplemented June 10, 2013 to offer a cash consent fee to holders of the 2019 Senior Notes consenting to the waiver and amendment. On June 12, 2013, the required consents were obtained, and the Company and trustee entered into a supplemental indenture effecting the waiver and amendment. In consideration for the waiver and amendment, Stewart will pay to noteholders that timely consented an aggregate cash payment equal to $2.50 per $1,000 principal amount of notes, of which half of such amount was paid promptly after the consent solicitation expiration and the execution of the supplemental indenture giving effect to the waiver and amendment, and the other half will be paid, if at all, promptly after the completion of the merger. SCI has agreed to guarantee the notes promptly following completion of the merger.

In connection with entering into the merger agreement, SCI entered into a commitment letter with JPMCB and J.P. Morgan Securities LLC, pursuant to which, among other things, JPMCB agreed to provide debt financing that will fund the merger consideration, refinance the Company’s existing indebtedness to the extent required under the terms of such indebtedness, and finance the payment of fees, expenses, accrued interest and premiums related to the provision of the financing and refinancing. As permitted under the terms of the commitment letter, it was amended on June 7, 2013 to provide that a portion of the financing would also be provided by Bank of America, N.A. and Wells Fargo Bank, National Association and an affiliate. As described further below, SCI has now obtained permanent financing to finance the merger.

The merger agreement permits SCI to amend the commitment letter so long as such amendment would not be reasonably likely to prevent or materially delay the completion of the merger, would not reduce the aggregate amount of financing available to SCI, and would not impose new or additional conditions to the financing. Under the merger agreement, SCI must use its reasonable best efforts to complete the financing on the terms and conditions as set forth in the financing commitment letter or to obtain alternative financing. See “The Merger Agreement (Proposal 1)—Financing; Financing Cooperation” for additional information. In general, the financing commitment letter will expire on the earliest of (i) the consummation of the merger, (ii) the termination of the merger agreement, or (iii) February 28, 2014, or such later date as the parties may agree upon.

The financing commitment letter includes commitments to:

On June 10, 2013, SCI completed an amendment to its $500 million senior unsecured revolving credit facility, which was scheduled to mature in March 2016, primarily to accommodate the acquisition.

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On July 1, 2013, as part of its permanent financing for the merger, SCI issued $425 million aggregate principal amount of 5.375% Senior Notes due 2022 in a private offering. The net proceeds of this notes offering of approximately $414.7 million will be held in an escrow account pending the closing of the merger. The notes are subject to special mandatory redemption in the event the merger is not completed on or prior to February 28, 2014, SCI determines in its sole discretion that the merger will not be completed by that date or the merger agreement is terminated.

On July 2, 2013, as part of its permanent financing for the merger, SCI entered into a new credit facility consisting of a $500 million revolving credit facility (in replacement of SCI’s existing revolving credit facility) and a term loan of up to $600 million. The revolving credit facility may be used to repay existing indebtedness, for working capital and for general corporate purposes (including, without limitation, the merger consideration) of SCI and its subsidiaries. The term loan may be used to (x) pay a portion of the consideration for the acquisition of Stewart, (y) refinance, prepay, repurchase and/or redeem certain existing indebtedness of Stewart and its subsidiaries and (z) pay a portion of the transaction costs associated with the foregoing. The obligations of the lenders to fund on the merger closing date (including the term loan, which is initially unfunded and permitted to be drawn on a delayed basis) are subject to a limited number of conditions customary for acquisition financings, including:

If the SCI term loan and SCI bridge facility (or other unsecured indebtedness in lieu of such facility) have all funded (or all conditions to funding have been satisfied other than filing the appropriate merger certificates with the appropriate secretaries of state) on or prior to the merger closing date and SCI has insufficient cash on hand and/or availability under the SCI revolving credit facility to finance the aggregate merger consideration, refinance the Company’s existing indebtedness to the extent required under the terms of such indebtedness, and finance the payment of fees, expenses, accrued interest and premiums related to the provision of the financing and refinancing, such event will constitute a knowing and intentional breach by SCI of the merger agreement.

The completion of the merger is not conditioned on SCI obtaining financing, and if the merger agreement is terminated due to SCI’s inability to obtain adequate financing, then SCI will be obligated under certain circumstances to pay Stewart a reverse termination fee of $75.0 million.

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Interests of Certain Persons in the Merger

In considering the recommendation of our board of directors with respect to the merger agreement, shareholders should be aware that our directors and executive officers have interests in the merger that are different from, and/or in addition to, those of our shareholders generally. These interests may create potential conflicts of interest. The board was aware of these potential conflicts of interest and considered them, among other matters, in reaching its decision to approve the merger agreement and to recommend that our shareholders vote in favor of approving the merger agreement.