PART
III
Item 10.
Directors,
Executive Officers and Corporate Governance
JACK E.
BRUNSON (50) has served as a director since 1999 and as President of NSFC since 1997. He
also serves on the Boards of Directors of NSFC and Omega. He joined the Company in 1982.
Mr. Brunson is a Chartered Property and Casualty Underwriter.
W. L.
BRUNSON, JR. (49) has served as a director since 1999 and as President and Chief Executive
Officer of the Company since 2000. He also holds the position of President of NSIC. He
joined the Company in 1983. Mr. Brunson is also a director of NSFC, NATSCO, NSIC, and
Omega. Mr. Brunson is a member of the Alabama State Bar.
MICKEY
L. MURDOCK (65) has served as a director since 1976 and is currently Senior Vice President
of NSIC. From 2002 to 2007 he served as Chief Operating Officer of the Company. From 1982
to 2002 he served as Chief Financial Officer and Treasurer of the Company. Prior to that
time, he served as Vice President and Controller of the Company. He joined the Company in
1970. Mr. Murdock is also a Director of NSIC, NSFC, Omega and NATSCO. Mr. Murdock
is a Certified Public Accountant.
BRIAN R.
MCLEOD (39) currently serves as Vice President, Chief Financial Officer and Treasurer of
the Company. From 1992-2002 he served as controller. He joined the Company in 1992.
Mr. McLeod is also a Director of NSIC, NSFC, Omega and NATSCO. Mr. McLeod is also
a member of the Board of Directors for Trinity Bank, a community bank in Dothan, Alabama.
Mr. McLeod is a Certified Public Accountant.
The
information contained on pages 4-5 of The National Security Group’s Proxy Statement
dated March 31, 2008, with respect to directors of the Company and Corporate Governance, is
incorporated herein by reference in response to this item.
The
information contained on page 6 of The National Security Group’s Proxy Statement
dated March 31, 2008, with respect to Audit Committee and Audit Committee financial expert,
is incorporated herein by reference in response to this item.
The
information contained on page 14 of The National Security Group’s Proxy Statement
dated March 31, 2008, with respect to information on the beneficial ownership reporting for
directors and executive officers, is incorporated herein by reference in response to this
item.
Item 11.
Executive
Compensation
The
information contained on pages 9-11 of The National Security Group’s Proxy Statement
dated March 31, 2008, with respect to executive compensation and transactions, is
incorporated herein by reference in response to this item.
Item 12.
Security
Ownership of Certain Beneficial Owners and Management and Related Stockholder
Matters
The
information contained on page 7 of The National Security Group’s Proxy Statement
dated March 31, 2008, with respect to security ownership of certain beneficial owners and
management, is incorporated herein by reference to this item.
Item 13.
Certain
Relationships and Related Transactions and Director Independence
The
information contained on page 8 of The National Security Group’s Proxy Statement
dated March 31, 2008, with respect to certain relationships and related transactions, is
incorporated herein by reference in response to this item.
Item 14.
Principal
Accountant Fees and Services
The
information contained on page 8 of The National Security Group’s Proxy Statement
dated March 31, 2008, with respect to principal accountant fees and services, is
incorporated herein by reference in response to this item.
76
PART
IV
Item 15
Exhibits and
Financial Statement Schedules
(a) The
following documents are filed as part of this report:
1.
|
Consolidated financial statements, notes thereto and related
information of The National Security Group, Inc. (the “Company”)
are included in Item 8 beginning on page 37:
|
•
|
Report of Independent Registered Public Accounting
Firm
|
•
|
Consolidated Statements of Income
|
•
|
Consolidated Balance Sheets
|
•
|
Consolidated Statements of Shareholders’ Equity
|
•
|
Consolidated Statements of Cash Flows
|
•
|
Consolidated Notes to the Financial Statements
|
|
2.
|
Additional financial statement schedules and report of
independent registered accounting firm are furnished herewith pursuant to the
requirements of Form 10-K:
|
|
|
|
|
|
The National Security Group, Inc.
|
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Page
|
|
Schedule I
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Summary of Investments
|
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67
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Schedule II
|
Condensed Financial Information of the Registrant
|
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68
|
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Schedule III
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Supplementary Insurance Information (Consolidated)
|
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72
|
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Schedule IV
|
Reinsurance (Consolidated)
|
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73
|
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Schedule V
|
Allowance for Uncollective Premiums and Other Receivables
(Consolidated)
|
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74
|
|
|
|
|
|
|
|
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3.
|
Amended Certificate of Incorporation filed with the Secretary of
State of Delaware on August 2, 2004 and By-Laws.
|
11.
|
Computation of Earnings Per Share Filed Herewith, See Note 1 to
Consolidated Financial
|
|
Statements
|
|
|
|
|
|
14.
|
Code of Ethics, see additional information on page 9 of this
report.
|
21.
|
Subsidiaries of the registrant.
|
31.1
|
Certification Pursuant to 18 U. S. C. Section 1350, as Adopted
Pursuant to Section 302 of the
|
Sarbanes-Oxley Act of 2002
31.2
|
Certification Pursuant to 18 U. S. C. Section 1350, as Adopted
Pursuant to Section 302 of the
|
Sarbanes-Oxley Act of 2002
32.
|
Certification Pursuant to 18 U. S. C. Section 1350, as Adopted
Pursuant to Section 906 of the
|
|
Sarbanes-Oxley Act of 2002
|
|
|
|
|
|
|
(b)
|
During the last fiscal quarter of the period covered by this
Report, the Company filed the following Current Reports on Form 8-K:
|
Date of Report
|
|
Date Filed
|
|
Description
|
|
|
|
|
|
|
|
|
|
|
|
|
November 13, 2007
|
|
November 13, 2007
|
|
Press release, dated November 13, 2007, issued by The National
Security Group, Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
77
SIGNATURE
Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
THE
NATIONAL SECURITY GROUP, INC.
/s/ Brian R. McLeod
|
|
/s/ William L. Brunson, Jr.
|
Brian R. McLeod
|
|
William L. Brunson, Jr.
|
Chief Financial Officer and
|
|
President, Chief Executive
|
Treasurer
|
|
Officer and Director
|
Date:
March 28, 2008
POWER OF
ATTORNEY
Know all by these present, that the
undersigned hereby constitutes and appoints Brian R. McLeod, with full power of
substitution and/or revocation, the undersigned’s true and lawful attorney-in-fact:
to execute for and on behalf of the undersigned, in the undersigned’s capacity as a
director of National Security Group, inc. (the “Company”), any and all forms
(including, without limitation Form 10-K) required or desired to be executed by or on
behalf of the Company pursuant to section 13 or 15(D) of the Securities Exchange Act of
1934, as amended, after said form has been approved by the Company’s audit committee;
to do and perform any and all acts for and on behalf of the undersigned which may be
necessary or desirable to complete and execute any such Form and timely file such Form with
the appropriate governmental authority (including, without limitation, the United States
Securities and Exchange Commission) and any stock exchange or similar authority; and Take
any other action of any type whatsoever in connection with the foregoing which, in the
opinion of such attorney-in-fact, may be of benefit to, in the best interest of, or legally
required by, the undersigned, it being understood that the documents executed by any such
attorney-in-fact on behalf of the undersigned pursuant to this Power of Attorney shall be
in such form and shall contain such terms and conditions as such attorney-in-fact may
approve in such attorney-in-fact’s discretion.
The undersigned hereby grants to each
such attorney-in-fact full power and authority to do and perform any and every act and
thing whatsoever requisite, necessary, or proper to be done in the exercise of any of the
rights and powers herein granted, as fully to all intents and purposes as the undersigned
might or could do if personally present, with full power of substitution or revocation,
hereby ratifying and confirming all that such attorney-in-fact, or such
attorney-in-fact’s substitute or substitutes, shall lawfully do or cause to be done
by virtue of this Power of Attorney and the rights and powers herein granted. The
undersigned acknowledges that the foregoing attorneys-in-fact, and each of them, in serving
in such capacity at the request of the undersigned, are not assuming, nor is the Company
assuming, any of the undersigned’s responsibilities to comply with
section 13 or 15(D) of the Securities
Exchange Act of 1934, as amended.
Pursuant
to the requirements of the Securities Exchange Act of 1934, this report has been signed
below by the following persons on behalf of the Registrant and in their capacity as a
Director of The National Security Group, Inc. on March 28, 2008.
SIGNATURE
/s/ Winfield Baird
|
/s/ Mickey L. Murdock
|
/s/ Carolyn Brunson
|
/s/ Donald Pittman
|
/s/ Jack E. Brunson
|
/s/ Fleming Brooks
|
/s/ William L. Brunson, Jr.
|
/s/ Paul C. Wesch
|
/s/ Fred D. Clark, Jr.
|
/s/ L. Brunson White
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/s/ Frank B. O’Neil
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/s/ Walter P. Wilkerson
|
78
Exhibit
31.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER
PURSUANT TO SECTION 302
OF THE
SARBANES-OXLEY ACT OF 2002
I, William
L. Brunson, Jr., certify that:
1. I
have reviewed this Annual Report on Form 10-K of The National Security Group,
Inc.;
2. Based
on my knowledge, this report does not contain any untrue statement of a material fact or
omit to state a material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading with respect to the
period covered by this report;
3. Based
on my knowledge, the financial statements, and other financial information included in this
report, fairly present in all material respects the financial condition, results of
operations and cash flows of the registrant as of, and for, the periods presented in this
report;
4. The
registrant’s other certifying officer and I are responsible for establishing and
maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e)
and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act
Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a.
Designed such disclosure controls and procedures, or caused such disclosure controls and
procedures to be designed under our supervision, to ensure that material information
relating to the registrant, including its consolidated subsidiaries, is made known to us by
others within those entities, particularly during the period in which this report is being
prepared;
b.
Designed such internal control over financial reporting, or caused such internal control
over financial reporting to be designed under our supervision, to provide reasonable
assurance regarding the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted accounting
principles;
c.
Evaluated the effectiveness of the registrant’s disclosure controls and procedures
and presented in this report our conclusions about the effectiveness of the disclosure
controls and procedures, as of the end of the period covered by this report based on such
evaluation; and
d.
Disclosed in this report any change in the registrant’s internal control over
financial reporting that occurred during the registrant’s most recent fiscal quarter
that has materially affected, or is reasonably likely to materially affect, the
registrant’s internal control over financial reporting; and
5. The
registrant’s other certifying officer and I have disclosed, based on our most recent
evaluation of internal control over financial reporting, to the registrant’s auditors
and the audit committee of the registrant’s board of directors:
a. All
significant deficiencies and material weaknesses in the design or operation of internal
control over financial reporting which are reasonably likely to adversely affect the
registrant’s ability to record, process, summarize and report financial information;
and
b. Any
fraud, whether or not material, that involves management or other employees who have a
significant role in the registrant’s internal control over financial
reporting.
|
Dated: March 28, 2008
|
|
/s/ William L. Brunson, Jr.
|
William L. Brunson, Jr.
|
President and Chief Executive Officer
|
79
Exhibit
31.2
CERTIFICATION OF CHIEF FINANCIAL OFFICER
PURSUANT TO SECTION 302
OF THE
SARBANES-OXLEY ACT OF 2002
I, Brian R.
McLeod, certify that:
1. I
have reviewed this Annual Report on Form 10-K of The National Security Group,
Inc.;
2. Based
on my knowledge, this report does not contain any untrue statement of a material fact or
omit to state a material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading with respect to the
period covered by this report;
3. Based
on my knowledge, the financial statements, and other financial information included in this
report, fairly present in all material respects the financial condition, results of
operations and cash flows of the registrant as of, and for, the periods presented in this
report;
4. The
registrant’s other certifying officer and I are responsible for establishing and
maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e)
and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act
Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a.
Designed such disclosure controls and procedures, or caused such disclosure controls and
procedures to be designed under our supervision, to ensure that material information
relating to the registrant, including its consolidated subsidiaries, is made known to us by
others within those entities, particularly during the period in which this report is being
prepared;
b.
Designed such internal control over financial reporting, or caused such internal control
over financial reporting to be designed under our supervision, to provide reasonable
assurance regarding the reliability of financial reporting and the preparation of financial
statements for external purposes in accordance with generally accepted accounting
principles;
c.
Evaluated the effectiveness of the registrant’s disclosure controls and procedures
and presented in this report our conclusions about the effectiveness of the disclosure
controls and procedures, as of the end of the period covered by this report based on such
evaluation; and
d.
Disclosed in this report any change in the registrant’s internal control over
financial reporting that occurred during the registrant’s most recent fiscal quarter
that has materially affected, or is reasonably likely to materially affect, the
registrant’s internal control over financial reporting; and
5. The
registrant’s other certifying officer and I have disclosed, based on our most recent
evaluation of internal control over financial reporting, to the registrant’s auditors
and the audit committee of the registrant’s board of directors:
a. All
significant deficiencies and material weaknesses in the design or operation of internal
control over financial reporting which are reasonably likely to adversely affect the
registrant’s ability to record, process, summarize and report financial information;
and
b. Any
fraud, whether or not material, that involves management or other employees who have a
significant role in the registrant’s internal control over financial
reporting.
|
Dated: March 28, 2008
|
|
|
Brian R. McLeod
|
Chief Financial Officer
|
80
Exhibit
32
CERTIFICATION PURSUANT TO
18
U.S.C. SECTION 1350,
AS
ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
We, W.
L. Brunson, Jr., President and Chief Executive Officer of The National Security Group, Inc.
and Brian R. McLeod, Chief Financial Officer of the Company, certify, pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350,
that:
1) The Annual Report on Form 10-K of the Company for the annual period
December 31, 2007 (the “Report”) fully complies with the requirements of
Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m);
and
2) The information contained in the Report fairly presents, in all material
respects, the financial condition and results of operations of the Company.
|
/s/ William L. Brunson, Jr.
|
William L. Brunson, Jr.
|
President and Chief Executive Officer
|
|
|
|
Brian. R. McLeod
|
Chief Financial Officer
|
|
Dated: March 28, 2008
|
81
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