Security National Financial Corp

This management-sponsored proposal asks shareholders to approve a targeted amendment to the Company’s 2022 Equity Incentive Plan authorizing up to 500,000 shares that were previously only issuable as Class A common stock to be issued instead as Class C common stock, without changing the Plan’s total share reserve. The Board frames the amendment as a tool to preserve flexibility in granting equity awards to attract, motivate and retain officers, directors and employees; it has unanimously approved the change and recommends shareholder approval. Materially, Class C shares carry ten votes per share while Class A shares carry one vote, so converting 500,000 Class A-authorized shares to Class C-authorized shares could substantially shift aggregate voting power if those shares are issued as Class C — the filing gives the concrete example of 4,500,000 additional votes in matters where Class A and Class C vote together and 500,000 fewer Class A votes in the separate Class A director election. The company discloses that there remain substantial unissued Class A-authorized shares under the Plan (1,896,335 as of March 1, 2026) and very few unissued Class C-authorized shares (4,207), which helps explain the practical motivation for the amendment. From a governance perspective, the proposal raises potential stockholder-control implications because issuance of Class C shares concentrates voting power per share; the Board's justification emphasizes compensation flexibility and retention rather than governance effects. The amendment does not expand the absolute number of shares available under the Plan but changes the class of up to 500,000 of those shares, meaning economic dilution to existing holders is similar while voting dilution could be asymmetric. The Board’s recommendation suggests it expects to use the flexibility primarily for compensation-related grants, and it emphasizes alignment of employees and directors with stockholder interests, but the amendment gives the Board discretion that could affect future corporate control dynamics depending on how and to whom Class C shares are granted. Risk-aware investors will weigh the retention/compensation benefits described by management against the potential change in voting composition and should consider whether additional guardrails or disclosure around the intended recipients and circumstances for issuing Class C shares would be warranted. Overall, this is a governance-sensitive technical amendment intended to provide compensation-plan flexibility with clear potential voting-power consequences if exercised.

This management-sponsored, non-binding proposal requests shareholder endorsement of the Company’s executive compensation program as disclosed in the proxy — commonly called a 'say-on-pay' vote. The vote asks shareholders to approve the overall compensation of the Named Executive Officers, including base salary, annual incentive awards, and equity participation, and is required by Dodd-Frank and SEC rules to be submitted to shareholders on an advisory basis. Management and the Compensation Committee argue the program is designed to align pay with performance, attract and retain key talent, and incentivize long-term value creation through equity awards. The proposal is explicitly non-binding, but the Board states it will consider the outcome when setting future pay practices; the proxy also notes the prior 2023 advisory vote and the Committee’s review of results. The Board recommends a vote FOR, asserting that the current compensation philosophy and components are reasonable compared to peer companies and tied to performance metrics. For investors assessing the proposal, considerations include the magnitude of total executive pay, the structure of incentive awards (including recent large option grants), related-party considerations (multiple executives are family members), and historical advisory vote outcomes. Although advisory, a negative vote could prompt the Compensation Committee to reconsider elements of the program, while a strong affirmative vote supports continuity in compensation design. The Board’s framing emphasizes governance and retention goals, but investors may weigh alignment, pay-for-performance measures, and executive ownership when evaluating the merits of the recommendation.