(4)	Foundation Asset Management reported sole voting and dispositive powers with respect to all of such shares in its report on Schedule 13D/A filed February 10, 2012.14, 2014.

(3)(5)

Dimensional Fund Advisors LP reported sole voting power with respect to 1,440,4811,708,591 of such shares and sole dispositive power with respect to all of such shares in its report on Schedule 13G/A filed February 14, 2012.10, 2014. Dimensional is an investment adviser registered under Section 203 of the Investment Advisors Act of 1940 and furnishes investment advice to four investment companies registered under the Investment Company Actdisclaims beneficial ownership of 1940. Dimensional also serves as investment manager to certain other commingled group trusts and separate accounts. Allall securities reported in this schedule are owned by these investment companies, trusts and accounts. Dimensional disclaims beneficial ownership of such securities.

(4)	Wellington Management Company, LLP reported shared voting power with respect to 1,136,853 of such shares and shared dispositive power with respect to all of such shares in its report on Schedule 13G/A filed February 14, 2012.

(5)	Manulife Financial Corporation, through its wholly owned subsidiaries, Manulife Asset Management (North America) Limited and Manulife Asset Management (US) LLC, reported sole voting and dispositive powers with respect to all of such shares in its report on Schedule 13G filed February 13, 2012.

(6)

Whitebox Advisors, LLC, as an investment adviser, reported shared voting and dispositive powers with respect to all of such shares in its report on Schedule 13G filed February 14, 2012, which it filed with Whitebox Advisors, LLC, Whitebox Multi-Strategy Advisors, LLC, Whitebox Multi-Strategy Partners, L.P., Whitebox Multi-Strategy Fund, L.P., Whitebox Multi-Strategy Fund, Ltd., Whitebox Concentrated Convertible Arbitrage Advisors, LLC, Whitebox Concentrated Convertible Arbitrage Partners, L.P., Whitebox Concentrated Convertible Arbitrage Fund, L.P., Whitebox Concentrated Convertible Arbitrage Fund, Ltd., Whitebox L/S Equity Advisors, LLC, Whitebox L/S Equity Partners, L.P., Whitebox L/S Equity Fund, L.P., Whitebox L/S Equity Fund, Ltd., HFR RVA Combined Master Trust, and IAM Mini-Fund 14 Limited. These securities include shares of the Company’s Common Stock, and shares of the Company’s Common Stock underlying the Company’s 6.00% Convertible Senior Notes due 2014 held by certain affiliates of Whitebox Advisors, LLC. Whitebox Advisors, LLC disclaims beneficial ownership of such securities except to the extent of its pecuniary interest therein.schedule.

Our Class B Stockholders have entered into an agreementare parties to certain agreements requiring, among other things, that the Class B Stockholders maintain an equala certain balance in their percentage ownership of the shares of Class B Stock by Malcolm S. Morris and by Stewart Morris, Jr. and Stewart Morris, collectively.Stock. Such agreementagreements also providesprovide for rights of first refusal among themselvesthe holders with respect to Class B Stock in the event of the death orof a holder of Class B Stock, the voluntary or involuntary disposition of Class B Stock and upon certain other specified conditions. By agreement among Malcolm S. Morris, Matthew W. Morris and Stewart Morris, Jr., Malcolm S. Morris has transferred 250,000 sharesAll holders of Class B Stock to Matthew W. Morris, who hashave agreed that all such Class B Stock shall remain subject to all the terms of the agreement amongexisting agreements. Malcolm S. Morris, and Stewart Morris, Jr. and Stewart Morris, collectively. Malcolm S. MorrisMCH Trust, and Matthew W. Morris collectively own 50% of the Class B Stock, and Stewart Morris, Jr. ownsand SSCLP collectively own 50% of the Class B Stock.

The following table sets forth information as of March 1, 201224, 2014 with respect to each class of our capital stock beneficially owned by our named executive officers, directors and nominees for director, and by all our executive officers, directors and nominees for director as a group:

(1)	Unless otherwise indicated, the beneficial owner has sole voting and dispositive power with respect to all shares indicated.

(2)

Includes 1,600 shares subject to stock options, 5,00029,280 shares of restricted stock, that will vest 20% each year over five years beginning March 10, 2012, 4,000 shares of restricted stock that will vest ratably over four years beginning March 10, 2012, and 477468 shares owned through the Company’s 401(k) plan.

(3)	Includes 25,000 shares subject to stock options, 10,00014,620 shares of restricted stock that will vest 20% each year over five years beginning March 10, 2012, and 8,000 shares of restricted stock that will vest ratably over four years beginning March 10, 2012.

(4)	Includes 25,000 shares subject to stock options, 10,000 shares of restricted stock that will vest 20% each year over five years beginning March 10, 2012, and 8,000 shares of restricted stock that will vest ratably over four years beginning March 10, 2012.

(5)	Includes 4,000 shares of restricted stock that will vest 20% each year over five years beginning March 10, 2012, 3,200 shares of restricted stock that will vest ratably over four years beginning March 10, 2012, and 11 shares owned through the Company’s 401(k) plan.

(6)(4)

Includes 6,3006,000 shares subject to stock options, and 15,218 shares of restricted stock.

(5)	Includes 10,512 shares of restricted stock.

(6)	Includes 18,077 shares of restricted stock.

(7)

Mr. Ajdler is the managing member of Engine Investments, LLC, the general partner of each of Engine Capital, L.P. and Engine Jet Capital, L.P., and may be deemed to be the beneficial owner of the 328,979 shares owned in the aggregate by Engine Capital and Engine Jet. Mr. Ajdler disclaims beneficial ownership of such shares except to the extent of his pecuniary interest therein.

(8)	Includes 6,000 shares of restricted stock, that will vest 20% each year over five years beginning March 10, 2012, and 4,80078,104 shares held indirectly through trust.

(9)	Includes 6,000 shares of restricted stock that will vest ratably over four years beginning March 10, 2012.stock.

The mailing address of each director and executive officer shown in the table above is c/o Stewart Information Services Corporation, 1980 Post Oak Boulevard, Suite 800, Houston, Texas 77056.

Section 16(a) Beneficial Ownership Reporting Compliance

Each of our directors and certain officers are required to report to the Securities and Exchange Commission, by a specified date, his or her transactions related to our Common Stock or our Class B Stock. Based solely on a review of the copies of reports furnished to us or written representations that no other reports were required, we believe that all filing requirements applicable to our executive officers, directors and greater-than 10% beneficial owners were met during 2011.2013.

PROPOSAL NO. 1

ELECTION OF DIRECTORS

At our annual meeting, our stockholders will elect nine directors, constituting the entire board of directors. Our Common Stockholders are entitled to elect five directors, and our Class B Stockholders are entitled to elect four directors. The Chairman of the board of directors is elected by the board following the annual meeting of stockholders. Our Class B Stockholders are entitled to nominate the person to serve as Chairman of the board of directors.

Common Stockholders’ Nominees

Dr. E. Douglas Hodo and Catherine A. Allen will not stand for reelection to the board of directors. The board of directors is grateful for their innumerable contributions to the Company over their 26 years and 5 years of service, respectively. Paul W. Hobby will not stand for reelection to the board of directors. It is expected that he will be elected to serve as an advisory director at the 2014 annual meeting.

We have nominated two new independent directors to serve on the board of directors: Glenn C. Christenson and Arnaud Ajdler. Additional information regarding Mr. Christenson and Mr. Ajdler is set forth below. Subject to his election at the upcoming annual meeting, the board of directors has selected Thomas G. Apel to assume Dr. Hodo’s duties as Chairman of the board of directors.

The following persons have been nominated by the board of directors to be elected as directors by our Common Stockholders. The persons named in your proxy intend to vote the proxy for the election of each of these nominees, unless you specify otherwise. Although we do not believe that any of these nominees will become unavailable, if one or more should become unavailable before the meeting, your proxy will be voted for another nominee, or other nominees, selected by our board of directors.

Each of the five nominees for election by our Common StockholdersMr. Clarke, Ms. Moore and Dr. Porter was elected by the Common Stockholders at our 20112013 annual meeting of stockholders.

Dr. HodoMr. Arnaud Ajdler has served as the managing partner of Engine Capital LP, a value-oriented investment firm focused on companies going through changes, since February 2013. He was previously a partner at Crescendo Partners, a value-oriented activist investment firm, from 2005 to 2013. Mr. Ajdler is also an adjunct professor of Value Investing at the Columbia Business School. He also serves as Chairman of the board of directors. Dr. Hodo served as President of Houston Baptist University for more than 19 years and became President Emeritus of the University in 2006. Dr. Hodo served on the board of directors of U.S. Global Investors, a public mutual fund, from 1981 to 2006, including holding the positions of Chairman of the Audit Committee from 1991 to 2004 and Chairman of the Board of Directors of Destination Maternity, Inc.

Mr. Ajdler served as a director of Charming Shoppes, Inc. from 19992008 until June 2012; O’Charley’s Inc. from March 2012 until April 2012; and as a director of The Topps Company from August 2006 until October 2007. Mr. Ajdler received a Bachelor of Science in mechanical engineering from the Free University of Brussels, Belgium, a Master of Science (SM) in Aeronautics from the Massachusetts Institute of Technology (MIT) and a Master of Business Administration from Harvard Business School.

Qualifications: Mr. Ajdler’s significant experience in value-oriented investing offers focused knowledge of businesses and their fundamentals, providing insight on elements that will strengthen the intrinsic value of Company stock. His participation on boards in the retail, restaurant and consumer-goods industries provides further expertise in management and consumer-facing activities.

Mr. Glenn C. Christenson, 64, has been managing director of Velstand Investments, LLC, a private investment management company, since 2004. Between 1989 and 2007, Mr. Christenson held various positions, including Director, Chief Financial Officer, Chief Administrative Officer, and Executive Vice President as well as other management roles at Station Casinos, Inc., (now Station Casinos LLC), a gaming entertainment company. Prior to 2004. that, Mr. Christenson was a partner of Deloitte Haskins & Sells (now Deloitte & Touche) from 1983-1989, with duties as partner-in-charge of Audit Services for the Nevada Practice and National Audit Partner for the Hospitality Industry.

He served on the boardas a director of directors of Southern National Bank of Sugar Land, Texas,NV Energy from 1995 to 2000, and was a member of their Audit Committee during that tenure. Dr. Hodo also2007-2013, where he served on the board of directors of Security Bank of Amory, Mississippi, from 1994 to 2003 and on their Audit and Long-Range Planning Committees.

Ms. Allenserves as Chairman of the Technology Advisory Committee. Ms. Allen is currently servingAudit Committee and as Chairman and CEO of The Santa Fe Group, a strategic consulting company that serves the financial sector in the areas of payments, fraud, information security and regulatory reform. Until 2007, Ms. Allen served as founding CEO of BITS, a consortiummember of the 100 largest financial services companies in the United States, which led the industry in developing best practicesCompensation and strategies for the industry in fraud prevention, cybersecurity, business continuity, anti-terrorism, payments and e-commerce. Ms. Allen isother Committees. Christenson was a director of El Paso Electric Company, serving on its Compensation, External Affairs and Energy and Natural Resources Committees. Ms. Allen is also a director at SynovusFirst American Financial Corporation serving on its Risk and Nomination and Governance Committees.

Mr. Clarkeservesfrom 2008 until 2011, where he served as Chairman of the Audit Committee. He served as director of Tropicana Entertainment, Inc. during 2010. Mr. Clarke has beenChristenson is a partnerCertified Public Accountant and holds an undergraduate degree in Business Administration from Wittenberg University and Master of Business Administration in Finance from The Ohio State University.

Qualifications: Mr. Christenson’s distinguished career as a CPA and range of roles in financial management provide in-depth understanding of practices and procedures regarding the Company’s financial and risk management interests. His significant experience and honors in the gaming, hospitality and energy industries offer a unique business perspective to advancing the Company.

Mr. Robert L. Clarke serves as Chair of the law firmAudit Committee. He is a Senior Partner in the Houston office of Bracewell & Giuliani, LLP, for more thanwhere he founded the past five years.law firm’s national and international financial services practice. Mr. Clarke was appointed as U.S. Comptroller of the Currency by President Ronald Reagan in 1985, and served until 1992 under Presidents Reagan and George H. W. Bush. He has extensive experience in bank ownership and operation, and expert knowledge of banking laws, regulations and supervision, both in the U.S. and internationally.

Mr. Clarke has served as a consultant to the World Bank, and senior advisor to the President of the National Bank of Poland. He also serves as a director and member of the Audit and Nominating and Corporate Governance Committees of the boardsboard of Mutual of Omaha Insurance Company and Eagle Materials Inc., a NYSE-listed manufacturer of building materials. He is a director, Chair of the Risk Committee, and member of the Investment Committee for Mutual of Omaha Insurance Company. He is also a director of Community Bancshares of New Mexico, Inc. and Community Bank in Santa Fe, New Mexico, and a director of the Dubai Financial Services Authority. Mr. Clarke has served as U.S. Comptrollera Trustee of Rice University from which he received its Distinguished Alumnus award, and continues to serve as a Trustee Emeritus and member of its Audit Committee. Additionally, Mr. Clarke is a Trustee of the CurrencySanta Fe Chamber Music Festival and its supporting Foundation, an Advisory Trustee of the Museum of New Mexico Foundation, a Trustee of the Financial Services Volunteer Corps, and a Trustee of the National Foundation for Credit Counseling. He received a Bachelor of Arts in economics from December 1985 through February 1992.Rice University, and an LL.B. from Harvard Law School.

Qualifications: Mr. Clarke is a veteran attorney and banking professional with extensive experience in legal and regulatory matters. His tenure in the U.S. federal government, along with his in-depth knowledge of banking and finance, provide valued expertise to the Company.

Ms. Laurie C. Mooreserves as ChairmanChair of the Compensation Committee. Ms. MooreShe is the founding CEOChief Executive Officer of the Institute for Luxury Home Marketing (the “Institute”), an international training and membership organization targeting real estate

agents who work in the luxury residential market (the “Institute”).market. For the 12 years prior to founding the Institute in 2003, Ms. Moore was Managing Partner of RealREAL Trends, Inc., a publishing, research, and strategic consulting company serving brokerage company owners and the top management of national real estate franchise brands. She

With nearly 40 years in real estate, Ms. Moore has been an industrya featured speaker for more than 25 years. In the area of governance, she has presented at events, including the 2014 ISS Annual Client Conference, 2013 Harvard

Law School Roundtable on Executive Compensation, 2012 NYSE Compensation Boot Camp and 2012 NYSE Compensation Strategies seminar. She earned a National Association of Corporate Directors Board Fellow designation in 2012; in the same year, she was also chosen as one of five top Texas businesswomen by the Texas Women’s Chamber of Commerce. As Executive Director of two residential brokerage Chief Executive Officer groups, she gained financial experience through more than 10 years supervising and preparing combined financial summaries for Chief Executive Officer peer review for dozens of major real estate firms.

Qualifications: As a founder of three businesses serving the residential brokerage industry, Ms. Moore’s experience provides keen insight on the Company’s customer base, particularly REALTORS^® and affluent consumers. She also has a deep understanding of the industry’s structure and is familiar with its major players. Ms. Moore brings a pragmatic approach to business challenges, and is valuable in assessing the expertise, knowledge and experience of potential director nominees.

Dr. W. Arthur Porterserves as ChairmanChair of the Nominating and Corporate Governance Committee. Dr. Porter is currentlyHe has been a Professor Emeritus of engineering at the University of Oklahoma since 2007; before his retirement, he was a University Professor and Regents Chair of Engineering. He recently served as Associate Dean, College of Natural Science, at Thethe University of Texas at Austin,(UT), Research Professor, Acting Director and Department Chair of the University of TexasUT Marine Science Institute and a Professor Emeritus of the University of Oklahoma. Priorfrom 2011 to his retirement from the University of Oklahoma, he served as University Professor and Regents Chair of Engineering at that university.2012. From 1998 to 2006, he served as University of Oklahoma Vice President for Technology Development, and also served as Dean of the College of Engineering from 1998 to 2005.

Prior to those appointments, he had served asDr. Porter was Founding President and Chief Executive Officer of Houston Advanced Research Center, a nonprofit research consortium, for more than five years.from 1985 to 1998. He also served aswas an Adjunct Professor of Electrical Engineeringelectrical engineering at Rice University for more than five years, priorand served in a range of educational and directorial capacities at universities in the U.S. and worldwide. Dr. Porter served as the Chairman of the board of directors for Southwest Nanotechnology from 2003 to his appointment with2008, and has been a member of numerous technology and banking boards. He holds a Bachelor of Science and Master of Science in Physics from the University of Oklahoma.North Texas, and a Ph.D. in Interdisciplinary Engineering from Texas A&M University.

Qualifications: Dr. Porter also previously served ashas extensive knowledge and experience in technology, strategic planning, executive management and intellectual property matters. His long-term management experience and participation in various boards of directors were instrumental in the Company’s recent reorganization, making him a director of Electro Scientific Industries, Inc. (ESI) in Portland, Oregon,key asset to continued growth and Bookham Technology (now Oclaro, Inc.) in San Jose, California. Dr. Porter served, at various times, as ESI’s Chairman of the Board and also on its Audit, Technology and Nominating and Corporate Governance Committees. Dr. Porter served, at various times, as either chairman or a member of Bookham’s Compensation, Audit and Nominating and Corporate Governance Committees.development.

YOUR BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTEFOR THE ELECTION OF THE FIVE NOMINEES FOR DIRECTOR.

Class B Common Stockholders’ Nominees

The following persons have been nominated as directors to be elected by our Class B Stockholders. The persons named in the Class B Stockholders’ proxies intend to vote the proxies for the election of the nominees named below, unless otherwise specified. Although we do not believe that any of these nominees will become unavailable, if one or more should become unavailable before the meeting, proxies will be voted for another nominee, or other nominees, selected by the Class B Stockholders.

Each of these nomineesThomas G. Apel, Malcolm S. Morris and Stewart Morris, Jr. was elected as director by our Class B Stockholders at our 20112013 annual meeting of stockholders.

Mr. Thomas G. Apelserves as is expected to become Chairman of the board of directors following the annual meeting. He is Chief Executive Committee. Mr. ApelOfficer of VLN, Inc., a non-conforming mortgage lending operation in Edmond, Oklahoma. He is also a research affiliate with the Massachusetts Institute of Technology, currently serves in a productfocused on business model taxonomy and business development role for Adfitech, Inc. the nation’s largest mortgage quality-control outsourcing firm. Mr. Apel founded Adfitech in 1983, subsequently sold the company in 1996 and has remained involved in various capacities.IT portfolio strategies. From 2006 to September 2009, Mr. Apel served as Chairman and CEO of Adfitech. In May 2009, Adfitech, Inc. filed for bankruptcy together with its parent company, Thornburg Mortgage, Inc. Adfitech, Inc. emerged from bankruptcy in 2010. From 2002 to 2006until January 1, 2013, Mr. Apel was ChairmanPresident of Intrepid Ideas Inc., a product development, technology evaluation and CEObusiness strategy consulting firm for financial services and real estate finance companies.

Prior to 2006, he served as President and Chief Executive Officer of Centex Title and Ancillary Services, and was responsible for management, strategy development and implementation of a wholly owned subsidiaryhighly profitable business unit containing national title, escrow, title insurance and property and casualty insurance operations. His background also includes extensive experience in mortgage lending and related real estate lending operations.

Qualifications:Mr. Apel has significant knowledge and experience in the mortgage, title, insurance and technology industries, as well as in corporate management, strategy, finance and start-up businesses. His familiarity with mortgage and other real estate lending provides a useful perspective on one of Centex Corporation.the Company’s essential customer segments.

Mr. HobbyGov. Frank Keatingis founding chairmanPresident and CEO of Genesis Park, L.P., a Houston-based private equity business specializingthe American Bankers Association. He was previously President and CEO of the American Council of Life Insurers. From 1995 to 2003, he served as Governor of the State of Oklahoma, the second person to hold the office for two consecutive terms. As Governor, he was recognized for his compassionate, professional handling of the Murrah Federal Building bombing in technologyOklahoma City, after which he raised over $6 million for children whose parents were killed in the tragedy.

Gov. Keating’s career has included time as an FBI agent, U.S. Attorney, State Prosecutor, and communications investments.member of Oklahoma’s state House and Senate. He served from 2004 through 2011 asin the CEOfederal Treasury, Justice and Housing departments under Presidents Reagan and George Bush, Sr., with responsibility for federal prosecutions and oversight over the Secret Service, U.S. Customs, U.S. Marshals, U.S. Attorneys and several other agencies. As Assistant Secretary of Alpheus Communications, Inc.,the Treasury and General Counsel and Acting Deputy Secretary of HUD, he worked on issues including housing finance, lending practices, securitization and Bank Secrecy Act issues.

Gov. Keating is a Texas wholesale telecommunications provider,graduate of Georgetown University and from 2002 to 2006, asthe University of Oklahoma College of Law, and the recipient of six honorary degrees. He is a frequent commentator on national news programs, Chairman of CapRock Services, Inc., the largest provideradvisory board of satellite services to the global energy business. Mr. Hobby

previously served onGeorge Washington’s Mount Vernon, and a member of the boards of four publicly traded companies: Coastal Bancorp, Inc.the National Archives, the Jamestown Foundation and Aronex Pharmaceutical, Inc. from 1999 through 2001, Amegy Bankthe Bipartisan Policy Center.

Qualifications: Gov. Keating’s lengthy public service career provides a depth of Texas, Inc. from 2002 through 2005,knowledge in government, legal, banking, directorial and EGL, Inc. from 2001 through 2007. He currently servesinfrastructure matters. With the numerous fiscal concerns facing the world economy and the housing industry in particular, he draws on considerable experience to advise the board on Company interests.

Mr. Malcolm S. Morris is a Vice Chairman of the Company, previously Chairman of the board of NRG Energy, Inc., a nonutility power generation company.

Malcolm S. Morrishas served as a Vice Chairman since November 2011, Chairman of the Board of Directorsdirectors and Co-Chief Executive Officer from 2000 until November 2011, and Senior Executive Vice President—Assistant Chairman for more than five years prior to that time. Malcolm S. Morris has2000. He is also served for more than the past five years as Chairman of the Board and Chief Executive Officerboard of Stewart Title Guaranty Company. His personal experience as a Company employee spans more than four decades, including responsibility for financial stability and efficiency improvements. He is the first cousin of Vice Chairman Stewart Morris, Jr. and father of Company Chief Executive Officer and Advisory Director Matthew W. Morris.

Mr. Malcolm Morris has more than 40 years of experience in the title insurance industry, and has served as President of the Texas Land Title Association and the American Land Title Association. He is a member and fellow of the American Bar Association and the Houston Bar Association, and a member of the State Bar of Texas. Mr. Malcolm Morris has a Master’s of Business Administration with a focus on finance and banking, and a J.D. from the University of Texas. He also attended the Harvard Law School’s Program of Instruction for Lawyers.

Qualifications: As a member of the Company’s founding family, with more than 40 years of tenure, Mr. Malcolm Morris has intimate knowledge of its operations, legal and regulatory matters, history and culture. His highly respected leadership and involvement in title industry organizations and advocacy are essential to the Company’s position as a leader in the market.

Stewart Morris, Jr. is a Vice Chairman of the Board of Stewart Title Company.

Stewart Morris, Jr.has served as a Vice Chairman since November 2011 and, prior to that, asCompany, previously President and Co-Chief Executive Officer from 2000 until November 2011. StewartMr. Morris, Jr. has also served as Presidentpresident and Chief Executive Officerchief executive officer of Stewart Title Company, and Chairmanchairman or Senior Chairmansenior chairman of the Boardboard of Stewart Title Guaranty Company, since 1991. He has been a company employee for more than 40 years, and has been responsible for the development of a number of real estate services and technology solutions, including productivity, e-commerce and settlement, related lender services, automated land record systems, courthouse automation and international land registries. He is the first cousin of Vice Chairman Malcolm S. Morris.

Mr. Morris, Jr. is a director of the American Land Title Association, and received the October Research 2012 Joe Casa Award in recognition of his leadership in industry innovation. In 2012, Mr. Morris, Jr. was named one of the 100 most influential real estate leaders by Inman News. With his in-depth knowledge of real estate transactions and affiliated technology, Mr. Morris, Jr. speaks frequently at industry conferences, universities and other forums. Mr. Morris, Jr. is chairman of the Oldham Little Foundation, which gives approximately 100 grants per year to small churches worldwide. For the past ten years, Mr. Morris, Jr. has served as chairman of the Carriage Museum of America, and currently serves as treasurer. He has a Bachelor of Arts in economics and political science from Rice University, and a Master of Business Administration with a focus on finance and real estate from the University of Texas.

Qualifications: As a member of the Company’s founding family, with more than 40 years of tenure, Mr. Stewart Morris, Jr. has intimate knowledge of the Company’s operations, technology interests, expansion strategy, management, history and culture. His significant expertise in real estate information technology and the transaction process has been key to the Company’s market leadership.

Malcolm S. Morris and Stewart Morris, Jr. are first cousins. Matthew W. Morris is the son of Malcolm S. Morris.

Nomination and Standstill Agreement

On February 12, 2014, the Company entered into a nomination and standstill agreement (the “Agreement”) with Foundation Onshore Fund, L.P., Foundation Offshore Master Fund, Ltd., Foundation Offshore Fund, Ltd., Foundation Asset Management GP, LLC, Foundation Asset Management, LLC, David Charney, Sky Wilber (collectively, the “Foundation Group”), Engine Capital, L.P., Engine Jet Capital, L.P., Engine Capital Management, LLC, Engine Investments, LLC, Arnaud Ajdler, (collectively, the “Engine Group” and, together with the Foundation Group, the “Shareholders”, and individually each a “Shareholder”), Glenn Christenson and Arnaud Ajdler (collectively, the “New Independent Directors”), pertaining to, among other things, the election of directors to the board of directors at the annual meeting and the formation of an advisory committee (the “Advisory Committee”). Pursuant to the Agreement, the Shareholders agreed to certain standstill and voting provisions. As of the date of the Agreement, the Shareholders were the beneficial owners of approximately 1,827,714 shares of the Company’s Common Stock, which represented approximately 8.5% of the issued and outstanding shares of Common Stock.

The Company agreed that the board of directors would nominate the New Independent Directors for election to the board of directors by the holders of Common Stock at the annual meeting. The Company agreed to allow the New Independent Directors to observe each meeting of the board of directors and the committees of the board of directors as non-voting observers until the annual meeting, provided that each New Independent Director execute a customary confidentiality agreement prior to observing any meetings.

The Company agreed to form an advisory committee (the “Advisory Committee”) for the purpose of overseeing the Company’s cost-reduction initiatives and reviewing the Company’s operations (efficiency, compensation, cost structure and other considerations) to determine if additional cost reductions are obtainable. The Company agreed that the Advisory Committee will consist of Thomas Apel, one New Independent Director chosen by the board of directors and one additional director chosen by the board of directors. The board of directors has chosen Glenn Christenson and Robert Clarke to serve on the Advisory Committee. The CEO will participate in meetings of the Advisory Committee.

Under the terms of the Agreement, at no time will the Foundation Group or the Engine Group individually beneficially own in excess of 9.99%, or collectively with any Shareholder affiliates beneficially own in excess of 14.99%, of the issued and outstanding voting securities of the Company. Furthermore, the Shareholders agreed not to, among other things, solicit proxies regarding any matter to come before the annual meeting, including for the election of directors, or enter into a voting agreement or any group with other stockholders with respect to the solicitation of proxies. The Shareholders also agreed to vote their shares in accordance with the recommendation of the board of directors with respect to director nominees and other matters presented to stockholders, provided that each of the Shareholders will be permitted to vote in accordance with any “against” recommendation by Institutional Shareholder Services, Inc. (“ISS”) relating to a proposal other than the election of directors if, after discussions with the Company in good faith, the Shareholder decides to follow the ISS recommendation.

Other elements of the Agreement include:

CORPORATE GOVERNANCE

Board of Directors

Dr. E. Douglas Hodo and Catherine A. Allen will not stand for reelection to the board of directors. The board of directors is grateful for their innumerable contributions to the Company over their 26 years and 5 years of service, respectively. Paul W. Hobby will not stand for reelection to the board of directors. It is expected that he will be elected to serve as an advisory director at the 2014 annual meeting.

We have nominated two new independent directors to serve on the board of directors: Glenn C. Christenson and Arnaud Ajdler. Additional information regarding Mr. Christenson and Mr. Ajdler is set forth above in Proposal No. 1. Subject to his election at the upcoming annual meeting, the board of directors intends to select Thomas G. Apel to assume Dr. Hodo’s duties as Chairman of the board of directors.

General

We are managed by a board of directors comprised of nine members, five of whom are elected by our Common Stockholders and four of whom are elected by our Class B Stockholders. A majority of the members of the board of directors are “independent” within the meaning of the listing standards of the NYSE. TheseAssuming the election of the 2014 director slate set described above, these directors are: E. Douglas Hodo, Chairman of the Board of Directors, Catherine A. Allen, Thomas G. Apel, Frank Keating, Glenn C. Christenson, Arnaud Ajdler, Robert L. Clarke, Laurie C. Moore and W. Arthur Porter. The board of directors has determined that none of these directors has any material relationship with us or our management that would impair the independence of their judgment in carrying out their responsibilities to us. In making this determination, the board of directors considers any transaction, or series of similar transactions, or any currently proposed transaction, or series of similar transactions, between us or any of our subsidiaries and a director to be material if the amount involved exceeds $120,000, exclusive of directors’ fees, in any of our last three fiscal years.

The roles of Chairman of the board of directors and Chief Executive Officer are separate and each role is held by a different individual. The Chairman of the board of directors is elected by the board following the annual meeting of stockholders. Our Class B Stockholders are entitled to nominate the person to serve as Chairman of the board of directors. Malcolm S. Morris served as our Chairman of the Board of Directors and Co-Chief Executive Officer from 2000 until November 2011, when he became Vice Chairman of the Board of Directors. Stewart Morris, Jr. served as our President and Co-Chief Executive Officer from 2000 until November 2011, when he became Vice Chairman of the Board of Directors. As discussed below, Malcolm S. Morris and Stewart Morris, Jr. serve as two of the members of our five-member Executive Committee, which may exercise all of the powers of the board of directors, except those specifically reserved to the board of directors by resolution of the board or applicable law. Dr. E. Douglas Hodo currently serves as our Chairman of the Board of Directors. As discussed below, Dr. Hodo also presides over the regular and any special meetings of our non-management directors. Our non-management directors meet prior to each regularly scheduled board meeting.

All of our directors shall be elected at the annual meeting of stockholders and hold office until the next annual election or until his or her successor shall be elected and shall qualify. Any action by the board of directors requires the affirmative vote of at least six members.

All of our officers shall be elected annually by the board of directors and hold office until his or her successor shall be chosen and shall be qualified, or until his or her death or the effective date of his or her resignation or removal for cause. The act of six of the directors shall be the act of the board of directors except as may be otherwise specifically provided by statute, by the Certificate of Incorporation, or by the Company’s Amended and Restated By-Laws.

The board of directors has unanimously approved, on a conditional basis, an amendment to the Company’s Amended and Restated By-laws to change the voting standard for uncontested director elections from a plurality standard to a majority standard. The majority voting standard raises the standard for election to the board of directors by requiring affirmative votes from a majority of the votes cast in an uncontested election. In connection with the majority voting standard, the board of directors further approved a policy requiring the resignation of a director who fails to receive a majority vote in an uncontested election. Under the new By-law, in a contested election, the plurality voting standard would still apply. The effectiveness of the amended By-law implementing the majority voting standard and related director resignation policy is conditioned on stockholder approval of Proposal No. 6 to eliminate cumulative voting.

During 2011,2013, the board of directors held four regular meetings, onetwo special meeting,meetings, one retreat, and executed threesix consents in lieu of meetings. Each directorAll directors attended eachall of such meetings, except that at one of such regular meetings only eight ofmeetings. For 2014, the nine directors were in attendance, and at the special meeting only six of the nine directors were in attendance. The board of

directors haswill have an Executive Committee, an Audit Committee, a Nominating and Corporate Governance Committee, a Compensation Committee and a Technologyan Advisory Committee. See “Committees of the Board of Directors” below.

The board of directors has adopted theStewart Code of Business Conduct and Ethics, Guidelines on Corporate GovernanceandCode of Ethics for Chief Executive Officers, Principal Financial Officer and Principal Accounting Officer, each of which is available on our website atwww.stewart.com/investor-relations/corporate-compliancecorporate-governanceand in print to any stockholder who requests it. We intend to disclose any amendment to or waiver under ourCode of Ethics for Chief Executive Officers, Principal Financial Officer and Principal Accounting Officerby posting such information on our website. OurGuidelines on Corporate Governance and the charters of the Audit Committee, the Nominating and Corporate Governance Committee, the Compensation Committee, and the CompensationExecutive Committee require an annual self-evaluation of the performance of the board of directors and of such committees, including the adequacy of such guidelines and charters. The charters of the Nominating and Corporate Governance Committee, the Audit Committee and the Compensation Committee are available on our website atwww.stewart.com/investor-relations/corporate-compliancecorporate-governanceand in print to any stockholder who requests them.

OurGuidelines on Corporate Governance strongly encourages attendance in person by our directors at our annual meetings of stockholders. All of our directors except one attended our 20112013 annual meeting of stockholders.

Director Qualifications

Each of our directors is an individual of high character and integrity, with an inquiring mind, and works well with other members of the board of directors and our management team. While we recognize that several directors had withhold votes cast last year, upon conversations with our shareholders, we concluded that the withhold votes were tied more to pay equity and performance than specific director qualifications. Based upon the responsiveness of the board in responding to shareholder concerns, we believe that the combined experience, qualifications, attributes and skills of our directors provide the Company with excellent leadership, especially in these challenging times.others. Each director nominee brings a unique background and set of skills to the board, giving the board of directors, as a whole, competence and experience in a wide variety of areas, including insurance, real estate, technology, strategic planning, corporate governance, executive management, academic, accounting, finance, government and international business. The following is a discussion of the particular experience, qualifications, attributes and skills of each of our director nominees that are considered important by the board of directors.

Catherine A. Allen. Ms. Allen has extensive knowledge and experience in technology, financial services and public policy, as well as significant corporate management experience. Her company, The Santa Fe Group, and former employer, BITS, are responsible for developing industry best practices in risk management. She also has experience in establishing best practices and standards for information security and fraud prevention.

Thomas G. Apel. Mr. Apel has significant knowledge of and experience in the mortgage industry. Mr. Apel also has extensive experience in technology and start-up businesses.

Robert L. Clarke. Mr. Clarke has extensive experience in business, government, banking, and legal and regulatory matters.

Paul W. Hobby. Mr. Hobby has extensive experience in private equity and mergers and acquisitions, as well as significant experience in public affairs.

Dr. E. Douglas Hodo. Dr. Hodo has extensive experience in administration and finance matters. He has a Ph.D. in economics and finance with over 30 years’ experience in financial risk assessment and analysis as both a consultant and professor.

Laurie C. Moore. Ms. Moore has a broad understanding of the real estate business developed during a more than 30-year career in the industry. She brings to the board strategic marketing skills, honed as an industry researcher and consultant to top management, and has experience as a founder and top executive of three successful businesses serving the residential brokerage industry. As Executive Director of two residential brokerage CEO groups, she gained functional financial experience, including more than 10 years supervising and coordinating preparation of combined financial summaries for 12 major firms in the real estate industry for CEO peer review. Ms. Moore is invaluable in assessing the subject matter expertise, knowledge, background and experience of potential director nominees.

Malcolm S. Morris. Malcolm S. Morris has over 40 years of experience in the title insurance industry and has served as President of the Texas Land Title Association and the American Land Title Association. Having worked for the Company for over four decades, he has intimate knowledge of the Company and its legal and regulatory matters. He has a J.D. and an MBA with a focus on finance and banking.

Stewart Morris, Jr.Stewart Morris, Jr. has over 40 years of experience in the title insurance industry and has intimate knowledge of the Company. Stewart Morris, Jr. is also an expert in real estate information technology,

including technologies related to productivity, e-commerce and settlement services, and has led the Company’s expansion into related lender services, automated land record systems, courthouse automation and international land registries. He has a B. A. in economics and political science from Rice University and an MBA with a focus on finance and real estate from The University of Texas.

Dr. W. Arthur Porter. Dr. Porter has extensive knowledge and experience in technology and intellectual property matters. Dr. Porter also has significant administrative and board experience and, as Chairman of our Nominating and Corporate Governance Committee, was instrumental in the Company’s recent reorganization.

For additional information regarding the qualifications, background and experience of our director nominees, please see each nominee’s biographical information under Proposal No. 1.

Risk Oversight

The board of directors has ultimate responsibility for protecting stockholder value. Among other things, the board of directors is responsible for understanding the risks to which we are exposed, approving management’s strategy to manage these risks, and monitoring and measuring management’s performance in implementing the strategy. The board of directors works with its committees and management to effectively implement its risk oversight role.

The Audit Committee, with the assistance of management, oversees the risks associated with the integrity of our financial statements, our compliance with legal and regulatory requirements, and our liquidity requirements and other exposures to financial risk. The Audit Committee reviews with management, externalindependent auditors and internal auditors (the internal audit function has been outsourced to Deloitte & Touche LLP) the accounting policies, the system of internal controls and the quality and appropriateness of disclosure and content in the financial statements or other external financial communications. The Audit Committee, with the assistance of our legal department and human resources department, also performs oversight of our various conduct and ethics programs and policies, including theStewart Code of Business Conduct and Ethics, reviews these programs and policies to assure compliance with applicable laws and regulations, and monitors the results of our compliance efforts. To the extent the Audit Committee identifies any material risks or related issues, the risks or issues are addressed with the full board of directors.

The Nominating and Corporate Governance Committee, with the assistance of management, oversees risks associated with administering ourGuidelines on Corporate Governanceand is responsible for reviewing and making recommendations for selection of nominees for election as directors by Common Stockholders. To the

extent the Nominating and Corporate Governance Committee identifies any material risks or related issues, the risks or issues are addressed with the full board of directors.

The Compensation Committee, with the assistance of management, oversees risks associated with our compensation programs and policies. To the extent the Compensation Committee identifies any material risks or related issues, the risks or issues are addressed with the full board of directors.

Advisory Directors

In addition to the directors elected by our Common Stockholders and Class B Stockholders, from time to time our board of directors appoints advisory directors. These individuals are selected based on their potential as future candidates for our board of directors. This gives potential director candidates the opportunity to learn firsthand about the Company and provides a bench of candidates who have gone through the learning curve regarding the Company, its products, policies and business practices. If elected, they are ready to fully engage as directors. Our advisory directors receive notice of and regularly attend meetings of our board of directors and committees on which they serve as non-voting members. They provide valuable insights and information, but are not included in quorum and voting determinations. AdvisoryNon-employee advisory directors receive the same compensation for their services as our elected directors receive. Employee advisory directors do not receive but theyany pay as an advisory director (see Footnote 1, Page 38). All advisory directors attend meetings at the pleasure of the board. Matthew W. Morris, the Company’s Chief Executive Officer (“CEO”), currently serves as an advisory director.

Committees of the Board of Directors

TheFor 2014, the board of directors of the Company haswill have the following committees: Executive, Audit, Nominating and Corporate Governance, Compensation and Technology Advisory.a new committee, Advisory, which shall be established immediately following the annual meeting.

Executive Committee.ExecutiveCommittee.The Executive Committee may exercise all of the powers of the board of directors, except those specifically reserved to the board of directors by law, orby resolution of the board of directors.directors, or by the Executive Committee Charter. The Executive Committee currently consists of Thomas G. Apel (Chair), Robert L. Clarke, Paul W. Hobby, Malcolm S. Morris and Stewart Morris, Jr. During 2011,2013, the Executive Committee held threefour meetings, at which all members were present, except that one director missed one meeting, and executed nineeleven consents in lieu of meetings. Assuming election of our director nominees, after the annual meeting the Executive Committee will consist of Tom Apel, (Chair), Robert L. Clarke, Glenn Christenson, Malcolm Morris, and Stewart Morris, Jr.

Audit Committee. It is the Audit Committee’s duty to assist the board of directors in monitoringfulfilling its oversight responsibility of (i) the integrity of the financial statements of the Company, (ii) the independent auditors’ qualifications, independence, and independence,performance, (iii) the Company’s system of controls over financial reporting, performance of the Company’sits internal audit function, which has been outsourced to Deloitte & Touche LLP,independent auditors, and independent auditors,compliance with ethical standards adopted by the Company, and (iv) the compliance by the Company with legal and regulatory requirements. The Audit Committee has sole authority to appoint or replace our independent auditors. The Audit Committee has the authority to engage independent counsel and other advisers as it determines necessary to carry out its duties. The Audit Committee operates under a written charter adopted by our board of directors, a copy of which is available on our website atwww.stewart.com/investor-relations/corporate-compliancecorporate-governance. The Audit Committee currently consists of Robert L. Clarke (Chair), Thomas G. Apel, Dr. E. Douglas Hodo and Laurie C. Moore. During 2011,2013, the Audit Committee held eight8 regular meetings and two special meetings, at which all members were present except that at one of such regular meetings only three of the four directors were in attendance, and at one of such special meetings only two of the four directors were in attendance.present. Each of the members of the Audit Committee is “independent” as defined under the listing standards of the NYSE and the Securities Exchange Act of 1934, and the board of directors has determined that Dr. HodoMr. Clarke is an “audit committee financial expert” as defined in the rules of the Securities and Exchange Commission. No member of our Audit Committee serves on the audit committees of more than three public companies. TheAssuming election of our director nominees, after the annual meeting the Audit Committee has the authority to engage independent counselwill consist of Robert L. Clarke (Chair), Glenn Christenson and other advisers as it determines necessary to carry out its duties.Laurie Moore.

The Audit Committee has established procedures for the receipt, retention and treatment of complaints received by us regarding accounting, internal accounting controls and auditing matters, and the confidential, anonymous submission by our employees of concerns regarding questionable accounting or auditing matters. Persons wishing to communicate with the Audit Committee may do so by writing in care of Chairman, Audit Committee, Stewart Information Services Corporation, 1980 Post Oak Boulevard, Suite 800, Houston, Texas 77056.

The Audit Committee has received the written disclosures and the letter from KPMG LLP required by applicable requirements of the Public Company Accounting Oversight Board regarding KPMG LLP’s communication with the Audit Committee concerning independence, and has discussed KPMG LLP’s independence with KPMG LLP.

Nominating and Corporate Governance Committee. It is the Nominating and Corporate Governance Committee’s duty to: (i) identify individuals who may become board members or advisory directors, (ii) select orrecommend director nominees for the next annual shareholder meeting, (iii) develop and recommend to the board of directors a set of corporate governance principles applicable to the Company, (iv) provide oversight of the Company’s corporate governance, and (v) oversee the evaluation of the board of directors and management. The Nominating and Corporate Governance Committee currently consists of Dr. W. Arthur Porter (Chair) and Laurie C. Moore, each of whom is “independent” as that term is defined in the listing standards of the NYSE. Governor Frank Keating, as an advisory director, also participates in meetings of the Nominating and Corporate Governance Committee. It is the Nominating and Corporate Governance Committee’s duty to (i) recommend to our board of directors nominations of persons for election by our Common Stockholders to our board of directors, (ii) create procedures for identification of nominees, (iii) consider and recommend to the board of directors criteria for nomination to our board of directors, (iv) receive and consider nominations submitted by our stockholders, (v) review and make recommendations with respect to director compensation, and (vi) oversee the self-evaluation of the board of directors and the Compensation Committee’s evaluations as to the performance of management as reported to the board of directors. The Nominating and Corporate Governance Committee held three meetingsfour regular and one special meeting during 2011,2013, at which all members were present. Our Nominating and Corporate Governance Committee’s charter is available on our website atwww.stewart.com/investor-relations/corporate-compliancecorporate-governance. Assuming election of our director nominees, after the annual meeting the Nominating and Corporate Governance Committee will consist of Dr. W. Arthur Porter (Chair), Laurie Moore, Governor Frank Keating and Arnaud Ajdler.

OurGuidelines on Corporate Governance requiresrequire that a majority of the nine members of our board of directors be “independent” as that term is defined in the rules of the NYSE. As described above, a majority of our current board of directors is “independent” under the filing standards of the NYSE. OurGuidelines on Corporate Governance also providesprovide that the Nominating and Corporate Governance Committee shall be guided by the following principles:

The board of directors does not have a formal policy with respect to board nominee diversity. In recommending proposed nominees to the full board, the Nominating and Corporate Governance Committee is charged with building and maintaining a board that has an ideal mix of talent and experience to achieve our business objectives in the current environment. In particular, the Nominating and Corporate Governance Committee is focused on relevant subject matter expertise, depth of knowledge in key areas that are important to us, and diversity of thought, background, perspective and experience so as to facilitate robust debate and broad thinking on strategies and tactics pursued by us. There are no minimum requirements for nomination.

In recent years, vacancies occurring in our board of directors have been filled by advisory directors whose experience and expertise have contributed significantly to the deliberations of the board of directors and who meet the criteria set forth above.

It

Each director is the intent of the board of directors to require each directorrequired to own an amount of Company Common Stock equal to a multiple of three times the director’s baseannual retainer. The multiple will be set with input from our compensation consultant (for further discussion, see Compensation Discussion and Analysis). Each director will have a reasonable numberhas five years, from the later of yearstheir initial election and March 2011, to acquire the required amount of Common Stock. Stock ownership requirements will behave been designed in such a way that the ability of the board of directors to recruit diverse board candidates will not be impaired, yet board members will have a strong alignment with stockholders.

Pursuant to our Amended and Restated By-Laws, the Nominating and Corporate Governance Committee will accept and consider nominations by stockholders of persons for election by our Common Stockholders to our board of directors. To be considered for nomination at our 20132015 annual meeting of stockholders, stockholder nominations must be received by us no later than February 15, 2013.14, 2015. Persons wishing to submit the names of candidates for consideration by the Nominating and Corporate Governance Committee may submit such nominations in writing addressed to the Nominating and Corporate Governance Committee in care of Corporate Secretary, Stewart Information Services Corporation, 1980 Post Oak Boulevard, Suite 800, Houston, Texas 77056. Any such submission should include the candidate’s name, credentials, contact information and consent to be considered as a candidate.

Compensation Committee. It is the duty of the Compensation Committee to review and recommend toassist the board of directors in discharging its responsibilities relating to the Company’s compensation policies, the compensation of ourthe Company’s officers and senior managers, and to produce the required report on executive officers.compensation for inclusion in the Company’s annual proxy statement. The Compensation Committee currently consists

of Laurie C. Moore (Chair), Catherine A. Allen and Dr. W. Arthur Porter. Governor Frank Keating, as an advisory director, also participates in meetings of the Compensation Committee. During 2011,2013, the Compensation Committee held four regular meetings and three special meetings, at which all members were present, and executed two consentsone consent in lieu of meetings.meeting. Our board of directors has determined that each member of our Compensation Committee is “independent” as that term is defined in the rules of the NYSE. Assuming election of our director nominees, after the annual meeting the Compensation Committee will consist of Laurie C. Moore (Chair), Governor Frank Keating, Arnaud Ajdler and Dr. W. Arthur Porter.

The Compensation Committee functions pursuant to its charter, which is available on our web site atwww.stewart.com/investor-relations/corporate-compliancecorporate-governance. Under its charter, the Compensation Committee is charged with establishing and monitoring the basic philosophy and policies governing the compensation of our executive officers and senior managers. The Compensation Committee makes recommendations to the board of directors with respect to compensation, incentive compensation plans and equity-based plans.

The Compensation Committee’s specific duties and responsibilities include, but are not limited to, the following:

The Compensation Committee shall have the sole authority to retain and terminate any independent compensation consultant. The Compensation Committee is responsible for determining the independence of such advisors by taking into consideration all factors relevant to advisor independence, including the factors set forth in the NYSE Listed Company Manual. The Compensation Committee shall have authority to direct the work of the compensation consultants and establish consultant’s fees. It may also obtain advice and assistance from other advisors it determines necessary for effective completion of its duties. The Company shall fund (i) the Compensation Committee approved expenses for any independent advisors employed by the Compensation Committee and (ii) any other reasonable expenses incurred by the Compensation Committee.

Technology Advisory Committee. It iswill be the Technologynew Advisory Committee’s duty to review, evaluate, monitoroversee our cost savings initiatives and provide feedback on technology-related matters, including assisting the board of directors and management in identifying emerging trends in technology that may present strategic opportunities or that can help the Company achieve its goals and priorities.determine if additional cost savings are obtainable. The Technology Advisory Committee currently consistswill consist of Catherine A. Allen (Chair), Thomas G. Apel Stewart Morris, Jr.(Chair), Dr. W. Arthur PorterGlenn Christenson and Paul W. Hobby. During 2011, the Technology Advisory Committee met three times, at which all members were present.Robert L. Clarke.

The Technology Advisory Committee’s specific duties and responsibilities include, but are not limited to, reviewing and providing guidance on the following:

Compensation Committee Interlocks and Insider Participation

None of the current or former members of the Compensation Committee is a former or current officer or employee of the Company or any of its subsidiaries, is involved in a relationship requiring disclosure as an interlocking executive officer/director, or had any relationship requiring disclosure under Item 404 of Regulation S-K.

Sessions of Non-ManagementIndependent Directors

Our non-managementindependent directors all of whom are independent, with the exception of Paul W. Hobby, meet at regularly scheduled sessions without management. Dr. HodoThe Chairman of the board presides at those sessions. Persons wishing to communicate with our non-managementnon- management directors may do so by writing in care of Chairman, Audit Committee, Stewart Information Services Corporation, 1980 Post Oak Boulevard, Suite 800, Houston, Texas 77056. Persons wishing to communicate with our other directors may do so by writing in care of Corporate Secretary, Stewart Information Services Corporation, at the same address.

EXECUTIVE OFFICERS

The following table sets forth the names and positions of our executive officers as of March 1, 2012:24, 2014:

Below is biographical information for our executive officers:

Matthew W. Morris. Matthew W. Morris, 4042 years old, was elected Chief Executive Officer of Stewart Information Services Corporationthe Company in November of 2011. Having served for the pastprior five years as Senior Executive Vice President of the Company, Stewart Title Company and Stewart Title Guaranty Company, in addition to serving as President of the Shared Services Division, Mr. Morris has an intimate knowledge of the Company. He provides leadership over all of the Company’s businesses, focusing on operational alignment, process efficiencies, smart growth and maximum shareholder value. In 2004, Mr. Morris joined the Company’s executive management team as Senior Vice President, Planning & Development. Previously, he was director of a strategic litigation consulting firm, offering trial and settlement sciences and crisis management. Mr. Morris received his BBAa Bachelor of Business Administration in Organizational Behaviororganizational behavior and Business Policybusiness policy from Southern Methodist University, and hisan MBA with a concentration in Financefinance from The University of Texas. In 2013, he was named a gold winner for Executive of the Year (large company category) in the Best in Biz awards, and recognized as an industry leader in the Swanepoel Power 200. Matthew W. Morris is the son of Malcolm S. Morris. Malcolm S. Morris and Stewart Morris, Jr. are first cousins.

J. Allen Berryman. J. Allen Berryman, 5456 years old, has served as Executive Vice President, Chief Financial Officer, Secretary and Treasurer of the Company since September 2008. From January 2006 through August 2008, Mr. Berryman served as Vice President—Finance of Contract Research Solutions, Inc., d/b/a Cetero Research, one of the world’s largest providers of early clinical trial and bioanalyticalbio-analytical laboratory services to pharmaceutical, biotechnology and geneticgeneric drug companies. From 2002 through 2005, Mr. Berryman was Chief Financial Officer ofPrior to joining Cetero, he spent nine years in the electronic payments industry, holding CFO and COO positions with Retriever Payment Systems a nationwide providerand TeleCheck International, and serving as Corporate Controller and Chief Accounting Officer of credit, debit and other card processing services to merchants.First Data Corporation. Mr. Berryman also has 12 years’ experience with the public accounting firm of Deloitte & Touche. Mr. Berryman received his BBABachelor of Business Administration in Accountingaccounting from the University of Georgia.

Michael B. Skalka. Michael B. Skalka, 60 years old,Georgia, and is the Chief Legal Officer and also serves as Group President of Global Underwriting Services for Stewart. Additionally, he currently serves as Chairman of Stewart Title Guaranty de México, S.A. de C.V., Chairman of Stewart Title Limited and Chairman and Chief Executive Officer of Stewart Title Insurance Company. In these positions, he directs and oversees the Company’s worldwide legal, regulatory, human resource, compliance and underwriting activities. Mr. Skalka joined the Company in 1988 and has more than 34 years of experience in the title insurance and real estate industries. Mr. Skalka received his B.A. degree from C.W. Post College of Long Island University and his J.D. from Chicago-Kent College of Law.a Certified Public Accountant.

Glenn H. Clements.Glenn H. Clements, 6466 years old, has been with the Company for more than 35 years and has extensive experience in the title insurance and real estate industries. As Group President, Direct Operations for Stewart Title Company, a wholly owned subsidiary of the Company, Mr. Clements is responsible for all domestic directly owneddirectly-owned agency offices in the Stewart Title network. In this position, heHe oversees all residential and commercial operations, including escrow closings, sales and production facilities.facilities, as well as Stewart Specialty Insurance Services and Stewart’s 1031 exchange company, Asset Preservation, Inc. Mr. Clements is on the boarda member of the Houston ChapterTexas Land Title Association and the Mortgage Bankers Association. He earned a Bachelor of the World Presidents OrganizationBusiness Administration and a Master of Business Administration from the University of Houston’s Center for Public Policy.Houston.

George L. Houghton.George L. Houghton, 5557 years old, has over 3739 years of title insurance industry experience. Currently, Mr. Houghton serves as Group President, Agency Operations for Stewart Title Guaranty Company and is responsible for Stewart’s independent title agency network across the United States. In addition, he oversees Stewart Vacation Ownership and Stewart Agency Technology Sales. Prior to becoming Group

President, Mr. Houghton was Executive Vice President, Agency Services Group for Stewart Title Guaranty Company from 2009 through 2011. Mr. HoughtonHe also served as Senior Vice President and National Agency Services Director, from 2005 through 2008, and District Agency Manager for South and West

Texas, from 2000 through 2004.and Senior Vice President—National Closing Officer for Stewart Title of Houston. Prior to joining Stewart, Mr. Houghton was the president and owner of an independent title agency in the Houston area. Mr. Houghtonarea, and is a licensed real estate broker. He graduated from the University of Houston with a Bachelor of Business Administration in 1981, and went on to earn a Master of Business Administration from Houston Baptist University in 1983.

John L. Killea. John L. Killea, 58 years old, is the chief legal officer of the Company. Killea is responsible for the underwriting, claims, litigation, compliance and regulatory areas for SISCO and its affiliated companies. With more than 32 years of legal experience, Mr. HoughtonKillea joined the Company in 2000 as counsel in the claims and agency underwriting areas for Stewart Title Insurance Company (“STIC”), the Company’s New York underwriter. He has served as chief claims counsel and general counsel for STIC, and continues to serve as general counsel for Stewart Title Guaranty Company since his appointment in 2008. Mr. Killea holds a Bachelor’s degree cum laude from Lafayette College and a Juris Doctorate from Fordham University School of Law. He is a member of the New York State Bar Association and has been admitted to practice in the State of New York and the United States District Court for both the Eastern and Southern Districts of New York.

Steven M. Lessack. Steven M. Lessack, 61 years old, is President of STGC Canada, and Chief Executive Officer of Stewart Title Limited, overseeing the Company’s business activities in the United Kingdom, Europe and Australia. In 1996, he opened the Canadian operation for Stewart Title Guaranty Company. With his more than 35 years of title insurance industry experienceand related real estate knowledge, he also holds the position of Group President, International Operations, where he is responsible for and oversees all title operations outside of the United States, in addition to the areasCompany’s expansion activities worldwide. In addition to Canada, the Company presently has operations in Mexico, Central & South America, the Caribbean, Australia and throughout Europe. Prior to joining Stewart, he was an independent agent of abstracting, title examination, underwriting, closing, title policy preparation, accounting, branch office management, company management, claims handling, marketing, sales and servicing and supporting independent title agencies.Stewart Title Insurance Company with offices throughout upstate New York. He attended California State University in San Bernadino.

Jason R. Nadeau. Jason R. Nadeau, 4143 years old, is Group President, Mortgage and Title Services for Stewart Titlethe Company. Mr. Nadeau joined the Company in 2008He is responsible for leading and for the past three years has served as the executive overseeing the lender anddeveloping comprehensive national mortgage services business lines.and title production. Additionally, Mr. Nadeau oversees Stewart’sStewart Lender Services, the Company’s national title production centers, and PropertyInfo Corporation, its real estate technology services company. Mr. Nadeau previously served as senior vice president of First American’s Enterprise Technology. From 1999 to 2006, Mr. Nadeau servedTechnology, and as president of RealEC^® Technologies, a company he helped found. Previous to his tenure at RealEC, Mr. Nadeau served as vice president of technology for Stewart Mortgage Information now known as(now Stewart Lender Services.Services), and in various capacities at Norwest Mortgage, now Wells Fargo^®. Mr. Nadeau graduated from the University of St. Thomas in St. Paul, Minnesota, with a bachelor’sBachelor’s degree in business finance and a minor in systems analysis and design.

Malcolm S. Morris, our former Chairman of the Board of Directors and Co-Chief Executive Officer, and Stewart Morris, Jr., our former President and Co-Chief Executive Officer, resigned from these respective positions in November 2011. Our board of directors elected each of Malcolm S. Morris and Stewart Morris, Jr. as a Vice Chairman of the board of directors, which is an officer position of the Company but not an executive officer position. This is a non-operational role. Malcolm S. Morris and Stewart Morris, Jr. continue to serve as directors elected by the Class B Stockholders, and are nominated as directors to be elected by the Class B Stockholders at our 2012 annual meeting.

COMPENSATION DISCUSSION AND ANALYSIS

Executive SummaryIntroduction

Fiscal year 2011 was a pivotal one forThe following Compensation Discussion and Analysis (“CD&A”), describes the Company’s executive compensation programs. Significant changes and decisions were made to set the stage for a complete redesignprogram in 2013. The objective of our executive compensation policies, programsprogram is to maintain a strong pay-for-performance culture in order to attract, retain, and corporate governance practices in response to shareholder concerns. Directionally,motivate the key leaders who serve our Company is rapidly moving towards a newand our stockholders. The following pages explain the process, objectives, and structure of the executive compensation model that emphasizes growth in shareholder value. In sum,decisions undertaken by our Compensation Committee and our board of directors for 2013. This CD&A is focusedintended to be read in conjunction with the tables beginning on tying executivepage 38 below, which provide detailed historical compensation information for our Named Executive Officers (“NEOs”). For 2013, our NEOs are:

Executive Summary

Stewart Pays for Performance and Responds to tangible financial and operational objectives using incentives thatShareholders

We are tiedcommitted to providing value to our business plan, stock price performance, and total shareholder return, while remaining consistentshareholders. Along with market best practices. Several milestones keythe strong support of the compensation programs by shareholders in 2013, we continued to strengtheningdedicate significant efforts to ensuring our executive compensation programs include:remained appropriate and properly rewarded executives in a manner consistent with feedback received by shareholders. We directly engaged our shareholders, similar to efforts in 2012, to solicit their thoughts and suggestions regarding our compensation programs, and we took action. We are confident that through the discussions below, our shareholders will see that we understand our responsibility to maintain an executive compensation program that fairly and appropriately compensates our executive officers.

Stewart Performance

2013 marked the 120th anniversary of the founding of the Company. From its inception in 1893, Stewart has grown to one of the largest title insurance companies in the nation, and one whose name is synonymous with trust, integrity, and service. This year also marked the achievement of many key strategic initiatives which will continue to position us well for the coming years, including:

Objective: Changing the Compensation Philosophy and Programs from the Ground Up

Following the annual shareholders’ meeting in 2011, the Board agreed that simply rethinking and redesigning our compensation programs was not enough to address shareholders’ obvious concerns about lack of profitability and the Company’s executive compensation policies. Instead, the Board decided it was crucial to start at the Company’s very foundation and where best practices regarding compensation should start—with the Company’s business strategy.

A strategic consultant was hired and, after an extensive company-wide strategic review, a new planning process was implemented. This process involved the entire senior management team and all business lines of the Company. As a result of this process, the board determined that new leadership, organizational restructuring, and new strategies were needed. A special committee of the board was formed to determine how to best implement the needed changes.

Based on the special committee’s work and recommendations, the following actions were taken, beginning early in the fourth quarter of 2011:

These achievement represent a short list of factors which contributed to our Company being one of the highest performing companies in its sector over the past three years. We have experienced consistent positive stock price growth over the past three year period, resulting in a three-year total return to shareholders of 183%. This results in a 3-year relative TSR rank, as compared to our peers, at the 97th percentile. Our Company is performing, and doing so at a rate markedly better than the majority of our peers.

Based on stock prices ending December 31, 2013. Stewart TSR Ranking provided by Longnecker & Associates. Source of Data: S&P Capital IQ

Pay for Performance

Actual total compensation for our CEO was below the market 25th percentile, while our named executive officers as a whole in 2013 were below the 50th percentile. Despite strong financial performance the past two years and a substantial increase in stock price over the same period, the compensation that we started substantive discussionshave paid our CEO

has remained below the 25th percentile of our peer group. The Company is aware that it is paying the CEO modestly considering the shareholder value created over his tenure; however this has been a result of Mr. Morris being new to the CEO role as of the end of 2011. The Committee continually assesses the performance of the CEO and his ability to generate value to shareholders. As a result, the Committee discussed Mr. Morris’ compensation in 2013 and determined the following:

As the following graph depicts, the performance of the Company under Mr. Morris’ leadership has generated an increase in shareholder value. While this has resulted in modest increases to compensation, the relative alignment to market still remains below the 25th percentile. As such, given Mr. Morris’ ability to lead the executive team and the obvious shareholder value he and his team have created, the Committee believes it is important to retain and motivate Mr. Morris to continue performing for shareholders.

NOTE: CEO Compensation and stock price information provided by Longnecker & Associates. CEO actual total compensation is comprised of base salary, actual annual incentive, grant-date value of long-term incentives, and all other compensation as reported in the summary compensation table for each respective year.

Response to 2013 “Say on Pay” Vote

An overwhelming majority of the votes cast on our 2013 Say on Pay proposal (the “2013 Say on Pay Vote”) were cast in favor of the proposal. Specifically, 85.6% of shares were voted in favor of our Say on Pay proposal. Based on the results of the 2013 Say on Pay Vote, as well as our ongoing dialogue with our stockholders, the Compensation Committee and our Board have concluded that the executive compensation design changes that were first disclosed in 2012, and have been utilized since, are consistent with stockholder expectations and are more properly aligned with the Company’s new compensation philosophy and objectives.

For 2013, our Compensation Committee Chairman, along with members of senior management, reached out to 14 of our largest institutional investors, as well as Institutional Shareholder Services, Inc. and Glass Lewis & Co., to gather feedback, and to discussengage in valuable discussions regarding our executive compensation program, corporate governance executive team changes, board composition, strategy changes,and strategic accomplishments. Thirteen of the on-going executive compensation study, and plans to strengthen our pay-for-performance philosophy for both annual and long-term incentives going forward. Conversations were also initiatedinvestors, along with ISS and Glass Lewis.Lewis, chose not to engage in discussions at this time. The fourteenth investor indicated approval of our compensation policies and programs. As we evaluated our executive compensation and governance programs in 2013, we considered and incorporated new and previous feedback we received from these sources, which resulted in maintaining previously instituted changes to our executive compensation programs. While all of our programs are discussed in detail below, some noteworthy changes which have occurred since 2011 are as follows:

Our Response to Shareholder Feedback:

Our Executive Compensation Programs: We Pay For Performance

The core principle of our executive compensation philosophy is to pay for performance. Accordingly, our executive compensation program is heavily weighted toward “at-risk” performance-based compensation. We

have three elements of total direct compensation: base salary, annual incentive bonus and long-term equity compensation. These elements provide our Compensation Committee with a platform to reinforce our pay-for-performance philosophy to address our business needs and goals with appropriate flexibility. As illustrated in these engagement efforts have includedthe chart below, in 2013, 72% of total direct compensation to our CEO was performance-based and not guaranteed, while 66% of NEO compensation was at-risk.

Our Executive Compensation Practices

Below we highlight certain executive compensation practices, both the practices we have implemented to drive performance, and the practices we have not implemented because we do not believe they would serve our Chairshareholders’ interests.

Given the dramatic changes to our compensation philosophy and practices, we believe this chart is important, as it clearly identifies the substantive changes to our compensation practices in the past two years.

Compensation Best Practices that We Follow
þ		Pay for Performance—We tie pay to performance. The majority of our executive pay is variable based upon performance and not guaranteed. We have established clear financial goals for corporate performance and differentiate based on individual achievement. In establishing goals, we select performance metrics that drive both our short-term and long-term corporate strategy in accordance with our strategic plan.
þ		Mitigate Undue Risk—We mitigate undue risk associated with compensation, including utilizing caps on potential payments, clawback provisions, retention provisions, multiple performance targets and robust board and management processes to identify risk.
þ		Double Trigger—All employment agreements and incentive award agreements for executives require a termination of employment in addition to a change in control before cash severance benefits are triggered.
þ		Minimal Perquisites—We provide only minimal perquisites (under $33,000 for any one executive) to our executive officers and do not offer gross-up on any perquisite.
þ		Regular Review of Share Utilization—We evaluate share utilization by reviewing overhang levels (dilutive impact of equity compensation on our shareholders) and annual run rates (the aggregate shares awarded as a percentage of total outstanding shares).
þ		Equity Ownership Guidelines—We require our directors and executive officers to acquire and maintain prescribed levels of ownership of our stock in order to align their interest with those of our stockholders. These guidelines require that within a five year period from the date a person becomes an executive officer, they must hold Company common stock in value equal to approximately 6 times for the CEO and .30 to 1 times their base salary for other executives.
þ		No SERP Program—We do not offer SERP’s to our current executives.
þ		Clawback Policy—Our long-term incentive plans have clawback provisions that include recapture rights for any incentive amount paid or vested in the event that the Compensation Committee determines that an executive has violated any of the restrictive covenants included in employment agreements.
þ		Minimum Vesting Requirements—We have instituted minimum vesting requirements for all equity-based compensation awards.
þ		Independent Compensation Consulting Firm—The Compensation Committee benefits from its utilization of an independent compensation consulting firm, Longnecker & Associates (“L&A”), which provides no other services to the Company.
Disfavored Compensation Practices that We do not Follow
þ		No Share Recycling under the Long-Term Incentive Plan
þ		No Excise Tax Gross-Ups Upon Change in Control
þ		No Repricing of Underwater Stock Options
þ		No Hedging Transactions or Short Sales by executive officers or directors Permitted
þ		No Guaranteed Bonus or Retention Bonus for executive officers
þ		Severance multipliers not greater than 3.0X for any executive officer

Oversight of our Executive Compensation Practices

Our executive compensation program is administered by the Compensation Committee our Head of Investor Relations,the Board. The Compensation Committee currently consists of three directors: Laurie C. Moore (Chair), Catherine A. Allen, and our Chief Human Resource Officer. Based

Dr. W. Arthur Porter. At all times in 2013, all of the persons serving on the active two-way dialogueCompensation Committee were independent, as defined by the standards of the NYSE, and satisfied the qualification standards of section 162(m) of the Code and Section 16 of the Exchange Act.

The Compensation Committee is responsible for, among other functions, reviewing and approving the total compensation for our executives consistent with the objectives and philosophy described below.

Executive Compensation Risk Management

The Compensation Committee does not believe that the Company’s compensation policies and practices encourage excessive or unnecessary risk-taking by our executives and other employees. In fact, the Compensation Committee believes that our compensation program is designed with an appropriate mix of compensation to mitigate these risks. Practices include:

Compensation Philosophy and Objectives

The Compensation Committee follows a “pay for performance” philosophy in our executive compensation structure which is designed to encourage and reward the achievement of our long-term goals and the feedbackcreation of shareholder value. For each executive, the pay-for-performance compensation package is also intended to represent a fair and competitive compensation arrangement that they expressed,promotes a meaningful work experience including personal fulfillment, competitive pay and job security.

The Compensation Committee believes that our executive compensation program should reward enhanced financial performance of the Company and maximize shareholder value by aligning the short-term and long-term interests of our executive officers with those of our shareholders. Our Company’s programs are intended to:

Our executive compensation also is intended to be market competitive. For 2013, the Committee approved base salary, annual performance compensation and long-term incentive compensation (together, the “total direct compensation”) for each executive that was intended to be competitive with our peer group. In addition, in establishing the compensation of our executives, the Compensation Committee also took into consideration historical and individual circumstances, including tenure and experience, individual performance, retention factors, and the availability of comparable data for each position.

The Compensation Committee believes that a majority of executive compensation should be “at risk”—that is, the ultimate, realized value of the compensation will be tied to the Company’s financial and equity performance. During periods when our financial performance meets or exceeds established objectives, we believe that executives should be rewarded appropriately under our incentive compensation programs for their efforts in achieving our goals. Likewise, when our performance does not meet the changes weestablished goals, incentive compensation may be reduced or may not be earned.

Incentive compensation is designed to balance short-term annual results and long-term multi-year success of the Company. Short-term awards primarily are initiating will address manypayable in cash, while long-term awards are equity-based awards. It is important to note that in comparing historical pay with pay for 2013 in the executive compensation tables that follow this CD&A, 2013 compensation continues to build on performance-based pay relative to previous years.

Implementing the Philosophy

In support of their concerns.our compensation philosophy:

What to Expect from the Company Going Forward

An important objective of the new compensation policy is to create a stronger pay-for-performance culture with heightened Board oversight.

The executive compensation philosophy now being developed will target compensation opportunitiesWhen setting base salary levels for our namedexecutives, we take into account external market rates, as well as executive officers (“NEOs”) at the median of those companies that we consider to be valid peers, while taking into considerationperformance, internal equity and pay trends over time compared to the trend in Company performance as measured by Total Shareholder Return (“TSR”). Peers will be publicly traded companies selected based on both the applicable six-digit GICS industry code and the company’s size (as measured by market capitalization and assets). Annual incentiveTSR.

Long-term

OtherOur executive compensation programs will also reflect sound corporate governance, marketplace best practices, and will beare based on solid business rationale. Other executive

The following table outlines the major elements of 2013 total compensation programs currently under review include stock ownership guideline levels, executive severance, and deferred compensation.for our executives:

Discussion of Our Historical Compensation Philosophy and Objectives and Its Impact on 2011Roles in Determining 2013 Named Executive Officer Compensation

Historically, our core compensation philosophy for executive officers has been based on fairness and internal pay equity, and not on targeting pay levels at a specified percentile of a compensation peer group. This compensation philosophy was intended to maintain associate satisfaction and morale by assuring that the compensation of executive officers, particularly our former Co-Chief Executive Officers, was not out of line with that of key employees and other associates. As a result of this focus on internal pay equity, in some years, the compensation of one or more key employees has exceeded the compensation of our former Co-Chief Executive Officers. Additionally, as part of the Company’s focus on fairness and internal pay equity, the Company found it unnecessary to enter into any executive employment or severance agreements.

Compensation commitments made in previous years under this old policy are reflected in our fiscal year 2011 compensation programs. However, significant changes will be seen in 2012 as the Compensation Committee finalizes the development of the new policies and then guides the development and implementation of new executive compensation programs.

The Role of the Compensation Committee Management and

As stated in the Compensation Consultants

TheCommittee Charter, the Compensation Committee is responsible for determining the components and amount of compensation for our executive officers and provides overall guidance for our employee compensation policies and programs. The Compensation Committee consults with the Chief Executive OfficerCEO for compensation recommendations for other executive officers and for the purpose of assuring that executive compensation programs do not distort our overall compensation structure. The Chief Executive Officer’sCEO’s recommendations are based upon his assessment of each executive officer’s performance, the performance of the individual’s respective business or function, and employee retention considerations. The Compensation Committee reviews our Chief Executive Officer’sCEO’s recommendations and approves, in its sole discretion, any compensation changes affecting our executive officers as it determines in its sole discretion.officers.

Note that for fiscal year 2011 compensation decisions,The Role of Management

Members of management, including Human Resources, assist the Compensation Committee reviewed and considered the compensationby providing recommendations that were presented by our former Co-Chief Executive Officers. Additionally,management believes will establish appropriate and market-competitive compensation plans for fiscal year 2011executive officers consistent with the Company’s compensation decisions, neitherphilosophy. As part of this process, management collaborates with the Compensation Committee norregarding information on market trends, potential

compensation plan designs, and industry trends, before making recommendations to the Compensation Committee. In preparation for the 2013 compensation plans, management:

At the end of the 2013 performance year, management relied upon any advice or compensation data from any compensation consultant.

Say on Pay Frequency Votereviewed metric based performance relative to expectations in 2013 of each executive other than the CEO, for the purpose of validating the 2013 short-term incentive awards and the long-term incentive awards.

The Company will hold an annual advisory stockholder vote on executive compensation. This decision was made in response to stockholder votes at the 2011 annual meeting.

Say on Pay Vote

At our 2011 annual meeting, 51.50% of stockholders voting on our Say on Pay proposal voted against the executive compensation of our NEOs as set forth in our 2011 proxy statement. Although the stockholder vote on executive compensation is non-binding, the Compensation Committee has considered,reviews and will continue to consider, the outcome of this vote each yeardiscusses management’s recommendations in conjunction with its independent compensation consultant when making compensation decisions for our Chief Executive Officer and other NEOs.or recommendations to the full Board.

In addition, after conversations with various stockholders to listen to their concerns, the Board interpreted the numerous withhold votes for membersThe Role of the Compensation Consultant

During 2013, the Compensation Committee engaged Longnecker & Associates (“L&A”) to assist in providing a comprehensive assessment of our executive compensation programs and to assist in the Chairmandrafting of this CD&A. The Compensation Committee retained the sole authority to select, retain, terminate, and approve fees and other retention terms of the relationship with L&A. In addition, L&A also assisted the Nominating and Corporate Governance Committee as a further strong statement of stockholder concerns about a perceived pay and

performance disconnect. More specifically, the Board understood that our stockholders were unhappy with the lack of profitability and earnings, and the disconnect with compensation decisions. As previously discussed and highlighted in the “Executive Summary,” in response, our Board andassessment of independent director compensation.

The Compensation Consultant provides various executive compensation services to the Compensation Committee. Generally, these services include advising the Compensation Committee beganon the process of defining and implementing select strategic, organizational and governance changes, and engaged Aon Hewitt to conduct a comprehensive review of the Company’s overall approach to executive compensation to ensure that the Company’s compensation plans and programs are tied to performance and in line with market best practices across the general industry and at select peer group companies. Following the conclusion of this review, the Company will implement additional changes, as necessary, to ensure that NEO compensation is properly aligned with our compensation philosophy, organizational results, and with market best practices. We believe our future compensation will link pay with performance, be aligned with stockholders, support implementation of our strategy, and allow us to attract and maintain necessary executive talent.

2011 Business Results

In determining compensation for our executives in 2011, the Committee considered the financial results and operating performance achieved, despite a difficult real estate business environment. We also evaluated the effort and results associated with restructuring and streamlining the Company and its executive team, the development of new strategies to take better advantage of opportunities, and the efforts to improve key internal operations. Some of our key business results for 2011 were:

Elements of Compensation

The principal componentsprinciples of our executive compensation program and providing market information and analysis regarding the purposecompetitiveness of our program design and award values in relationship to performance.

During 2013, the Compensation Consultant performed the following services for the Committee:

In addition, L&A attended meetings of the Compensation Committee, as requested by the Compensation Committee Chair.

The NYSE has adopted guidelines for Compensation Committees to consider when identifying Compensation Committee advisor independence. The Compensation Committee reviewed these guidelines and determined that L&A is an independent consultant under these guidelines. This independence was confirmed in writing by L&A. L&A performs no services for the Company other than those specific to Board Committee assignments regarding executive and non-employee director compensation.

Our management communicates with L&A and provides data to L&A regarding our executive officers, but does not direct L&A’s activities.

Benchmarking and Peer Group Comparison

As previously noted, for fiscal year 2011 compensation, we used a philosophydiscussed above, during 2013, L&A analyzed the Company’s 2012 peer group and additional potential peer candidates in an effort to capture changes in the market that impacted the applicability of fairness and internal pay equity,certain peers within the Company’s 2012 peer group, as well as individual strategicadditional companies which we compete with for talent. As a result, L&A provided a recommended peer group for the Compensation Committee’s review. The Compensation Committee approved the final peer group utilized in the 2013 compensation analysis.

The compensation analysis was based upon an evaluation of approximately 70 potential peers consisting of financial services, insurance, title services and business-related goalsreal estate companies. L&A reviewed multiple financial criteria focusing on companies which are within a range of 0.5x to establish target2.0x our size. In addition to financial metrics, L&A and the Compensation Committee also took into account other factors in the determination of appropriate peer comparators, including title companies, financial service companies tied to the real estate market, and complexity of operations.

L&A compiled compensation levelsdata for our NEOs. Somethe peer group from a variety of sources, including proxy statements and other publicly filed documents. The consultant also provided published survey compensation components for 2011 were partdata from multiple sources, including the following surveys: Economic Research Institute, Mercer, Inc., Kenexa and Towers Watson. For each survey, L&A adjusted the data to appropriately reflect companies of existing incentive award plans, and were already in place priora similar size to and during 2011. Given the change in management in November of 2011, all compensation discussions are relevant to our executive officers up to that time. As stated previously,Company.

For each element of compensation for which data was available, L&A averaged the 25th percentile from the peer group and the published survey data to approximate the 25th percentile for the “market.” A similar process was used to establish the 50th and 75th percentiles. The combination of published survey data and peer compensation data was then used to compare the compensation of our executives to comparably titled persons at companies within our peer group and in the survey data.

When considering our compensation programs is being reviewedpractices and levels, the Compensation Committee reviews the compensation practices and levels of the peer group companies to determine market levels. The Compensation Committee periodically reviews the composition of our peer group to ensure that the companies in the group are relevant for comparative purposes, have executive positions with responsibilities similar to ours, and that compete with us for executive talent. The Compensation Committee and L&A review data for potential peers relating to revenue, assets, enterprise value, and market capitalization. Based on these factors and directly comparable business lines, the Compensation Committee determined that the following companies would comprise our compensation consultant. We expect significant changes to our compensation programspeer group for 2012.2013.

Compensation Component		Key Characteristics		Purpose		2011 Key Actions
Annual Incentive Bonus Awards		Variable cash compensation component. Both formulaic and discretionary incentive bonus awards utilized. Performance-based opportunity. Historically, formulaic bonuses were based on Stewart Title Guaranty Company (“STGC”) performance and Board approval. The Board may consider any circumstances it deems appropriate in awarding both formulaic and discretionary bonus compensation. The historical formulaic bonus program based on STGC performance will not be utilized in 2012 and beyond.		Intended to motivate and reward executive officers for achieving our short-term (annual) business objectives and financial performance; intended to encourage accountability by rewarding based on performance. Discretionary bonuses are reviewed annually for individual contribution in the context of Company performance. Discretionary bonuses provide the Committee with flexibility to reward individual performance not reflected in formulaic metrics.		Certain NEOs would have received cash bonus awards under our historical formulaic incentive bonus award program. Based on the recommendation of the Compensation Committee, instead of paying these incentive bonuses, the Board granted phantom stock units to two of the NEOs and restricted stock to one of the NEOs. See “—Annual Incentive Bonus Awards” below for further discussion. Two NEOs received discretionary bonus awards ranging from $150,000 to $225,000. The discretionary bonuses were based on the accomplishment of specific goals that were considered key to improving organizational performance and contributing to bottom-line results, as well as the assumption of new responsibilities by one NEO.
Long-Term Incentive Equity Awards		Variable compensation component. Performance-based award opportunity, generally granted annually as a combination of both unrestricted and time-based restricted stock awards. Actual grant sizes for both unrestricted and time-based restricted stock awards determined at the discretion of the Compensation Committee and will vary based on stock price appreciation and corporate performance.		Intended to motivate executive officers to achieve our business objectives; to provide retentive value; and to increase executive share ownership to thereby align executive interests with those of our shareholders.		Based on Company performance, our NEOs did not receive additional long-term incentive equity awards in 2011. One NEO did receive a grant of restricted stock in lieu of a payout under our historical formulaic annual incentive award program.

Compensation Component		Key Characteristics		Purpose		2011 Key Actions
Health and Welfare Plans and Retirement Plans		Fixed compensation component.		Intended to provide benefits that promote employee health and welfare, and to support Stewart employees in attaining financial security; a retention tool; and to attract qualified employees.		No changes to programs in 2011 that affected the NEOs.
Perquisites and Other Personal Benefits		Fixed compensation component.		Intended to provide a business-related benefit to our Company, and to assist in retaining executive officers.		No changes to programs in 2011 that affected the NEOs.

Base Salaries

We pay an annual base salary to each of our NEOsexecutives in order to provide them with a fixed rate of cash compensation that is “non-variable” during the fiscal year. Typically, inIn establishing base salaries, the Compensation Committee considers a variety of factors, including internal pay equity, and individualoperational performance as it relates to an executive’s level of duties and responsibilities applicable to the position held. held, and historical compensation information. We believe that this is critical to motivate and retain our executives who each have leadership talents and business expertise that make them attractive to other companies.

In connection with its annual review of executive compensation, the Compensation Committee, with recommendations from the CEO, determined that 2012 base compensation for NEOs remained appropriate for 2013 given the competitive market. Base salaries for each of the NEOs are shown in the table below:

Short-Term Incentives for 2013

Short Term Incentive Plan

The Compensation Committee believes STI compensation is an important part of the compensation package provided by companies with which we compete for executive talent, and therefore a well-reasoned STI approach can help us to be competitive. At the same time, we believe our STI approach motivates our executives to meet our financial and strategic objectives.

In setting the target cash award amounts for 2013, the Compensation Committee considered information from the peer group data mentioned above and, with respect to the executives other than the CEO, the recommendations of CEO. In addition, the Compensation Committee and management performed a detailed analysis in setting objective financial measures and goals to ensure the program appropriately balanced the Company’s objectives, as aligned with long-term shareholder interest, and individual operational performance objectives, as well as appropriate and effective risk-mitigating components. The Compensation Committee established a target award amount for each NEO as a percentage of base salary. This target was used at the end of the year as the base point for determining any actual earned award. In addition, a maximum award opportunity of 200% of target was established.

Based on the recommendations from the CEO, the Compensation Committee established corporate performance goals and operational performance goals for each NEO for 2013, as well as the applicable weight for each of the goals. The Compensation Committee chose the following metrics to:

The following table outlines the targeted award opportunity, metrics utilized to determine the STI payout, performance results, and the actual STI payout for each NEO.

(2)

Modified Return on Equity is calculated by dividing modified net earnings attributable to Company, which is calculated by subtracting certain items including, but not limited to, certain unusual income tax expense or benefit as determined by the board of directors of the Company from net earnings attributable to Company, by modified average shareholders’ equity, which is calculated by subtracting cumulative other comprehensive income and noncontrolling interest from shareholders’ equity.

(3)	Relative TSR Ranking is determined by calculating the Company’s percentile ranking for TSR relative to the Russell 2000 Financial Services Index.

(4)	Project Attainment is specific goals established for each service center executive. This metric is measured by determining how much of the annual goals were completed on a percentage basis.

(5)	Customer Service Index is an internal survey conducted at least annually. The metric is calculated by taking the subsequent survey score minus the benchmark survey score. The difference is then divided by the benchmark survey score.

(6)	Budget Attainment metric measures the variance between actual expenses and budgeted expenses. It is calculated by taking the actual annual expenses minus the budgeted annual expenses. The difference is then divided by the budgeted annual expenses.

(7)	Modified EBITDA is calculated by subtracting Investment Income, Investment and Other Gains (Losses)—Net, and other unique or unusual items as determined by the board of directors of the Company from EBITDA.

(8)	Modified EBITDA Margin is calculated by dividing Modified EBITDA by operating revenues.

(9)	Employee Costs Ratio is calculated by dividing the employee costs by operating revenues.

(10)	Policy Loss Ratio is calculated by dividing title losses and claims by title insurance revenues from Direct Operations and Agency Operations.

(11)

National Production Services (NPS) Expense Ratio is calculated by dividing NPS expenses by the sum of (1) operating revenues less the Company’s portion of earnings from equity investees from the Direct Operations and (2) external operating revenues less the Company’s portion of earnings from equity investees from NPS.

(12)	Operating Revenues Improvement is calculated by comparing current year revenues from operations reported in local currency against prior year revenues from operations reported in local currency.

(13)	Pretax Profit Margin is calculated by dividing pretax profits by operating revenues.

Long-Term Incentives for 2013

Long Term Incentive Plan

We believe that long-term incentives help align the interests of our executives and our stockholders because the potential compensation an executive can receive is tied directly to our stock price and our earnings performance. We believe this element of compensation is particularly effective for those individuals who have the most impact on the management and success of our business. In addition, by using metrics related to TSR and Company performance, this also serves to focus our executives on operating as a team. Prior to 2012, the Company granted time-based restricted stock and unrestricted stock to its executives. As part of the executive compensation program overhaul undertaken in 2012, the Company moved away from granting solely time-based and unrestricted equity compensation awards to its executives and instead, used performance-based equity and cash-based awards. This created an enhancement of the motivation of executives to increase shareholder value over the NEOs’ base salary amounts for fiscallong-term, as a significant amount of potential value is tied to Company performance. For 2013, our executives were granted long-term incentives in the form of performance-based restricted stock and cash-based performance units. The Compensation Committee determined to grant these awards with sixty percent (60%) in performance-based restricted stock (“RSA”) and forty-percent (40%) in cash-based restricted performance units (“RPU”). LTI is granted annually under this plan. It is 100% granted, but vests depending on company performance measures and time. Both RPU and RSA grants will be restricted by a three year 2011. Therefore,cliff vest, with the exception of Matthew W. Morris, who became our Chief Executive Officera specific grant of RPU issued in November 2011,2012, which vested at the base salariesend of our NEOs remained at 2010 levels, in2013 to assist with the following amounts: $305,000 for Malcolm S. Morris; $305,000 for Stewart Morris, Jr.; $250,000 for J. Allen Berryman;transition to new employment agreements.

In determining the size of each executive’s 2013 LTI target and $500,000 for Michael B. Skalka. Matthew W. Morris’maximum award sizes, as a percentage of base salary, increased to $305,000 effective November 2011.

Annual Incentive Bonus Awards

Historically, the Company has paid annual cash incentive bonus awards, both formulaic and discretionary, to certain executive officers. The formulaic awards were typically based on the consolidated income (before taxes but after noncontrolling interests) of STGC. Specifically, the amount of any formulaic cash incentive bonuses paid to our former Co-Chief Executive Officers (Malcolm S. Morris and Stewart Morris, Jr.) in recent prior years would have been equal to 1% of the first $20 million of STGC’s consolidated income, 0.75% of the next $20 million of income, 0.50% of the next $20 million, and 0.35% of income over $60 million. It was expected that similar formulaic cash incentive bonus awards would be paid for 2011 and the Company had accrued for the expected bonus payouts. However, the Board, based on the recommendation of the Compensation Committee concluded that paying out the formulaic cash bonus awards for 2011 consistent with past practice was not appropriate under the current circumstances. Based on discussions with, and the agreement of, the Company’s executive management and Malcolm S. Morris and Stewart Morris, Jr., the Board determined to modify the nature of the payout of the formulaic bonuses soconsidered information from peer group data, as to tie a portion thereof to the Company’s future performance. For 2011, underwell as the historical formulaic cash incentive bonus award program,compensation amounts and individual roles and responsibilities of each of Malcolm S. Morris and Stewart Morris, Jr. would have earned a cash bonus award of $219,800 payable in a lump sum. Basedapplicable executive. The LTI financial target metrics were based on the Compensation Committee’s recommendation, the Board approved, in March 2012, the grant of $219,800 of phantom stock units to each of Malcolm S. Morris and Stewart Morris, Jr. The phantom stock units can be settled solely in cash and vest 50% at grant, 25% on the first anniversary of the grant date, and 25% on the second anniversary of the grant date. Our current Chief Executive Officer, Matthew W. Morris, was entitled, for 2011, to a bonus equal to 0.30% of the first $100 million of STGC’s consolidated income and 0.20% of income over $100 million. Given that STGC’s consolidated income (before taxes but after noncontrolling interests)

finished at $22,640,000 for 2011, Matthew W. Morris earned a formula-based cash incentive bonus award of $67,920. Based on the Compensation Committee’s recommendation and the agreement of Matthew W. Morris, the Board approved, in March 2012, the grant of $67,920 of restricted stock to Matthew W. Morris. The restricted stock vests 50% at grant, 25% on the first anniversary of the grant date, and 25% on the second anniversary of the grant date.TSR and/or positive EBITDA. The Compensation Committee has recommendedchose those metrics to create a correlation between executive compensation and the Board has determined thatlong-term performance of the historical formulaic incentive bonus award program will not be continued in the future. As discussed above,Company.

In 2013, the Compensation Committee working with its compensation consultant,established the following targeted and maximum LTI award opportunities as a percentage of base salary:

Performance-Based Restricted Stock

The purpose of using performance-based RSAs is into provide a reward whose value is directly attributable to their ability to increase the process of revising the Company’s compensation programs, including its annual incentive award program.

Additionally, NEOs may receive discretionary cash incentive bonus awards upon approval by our Board for meeting or exceeding individual objectives that have an impact on shareholder value. For 2011, in considerationvalue of the successful implementationbusiness and our stock price. Our executives are granted annual awards of various individual objectives,RSAs with vesting contingent upon the Board determined to award discretionary incentive bonus awardsachievement of an annualized TSR ranking, relative to the two NEOs listed below:Russell 2000 Financial Services Index, which is at or above the 50th percentile of the peer group or if Annualized Total shareholder Return (TSR) is positive over the performance period. In the event this level of performance is not achieved, recipients will forfeit these RSAs. In addition to the performance component, award agreements require recipients to be employed with the Company through the entire three year performance period in order to maintain eligibility for the payout.

Cash-Based Performance Units

Performance units are used to reward our executives for effective management of the business over amulti-year period. In addition, these are used to tie the award to building value for shareholders without diluting stock. Executives will receive RPUs based on annualized TSR Ranking relative to the Russell 2000 Financial Services Index with a Circuit Breaker (positive EBITA over the performance period). RPU’s have a three year time vesting component that requires the executive to be employed with the Company through the performance period with the exception of the initial 2012 grant which vested at the end of 2013 to assist with the transition to new executive employment agreements. Relative TSR performance and EBITDA goals have been established for the RPUs and are tied to specific ranges of performance: Threshold, Target and Maximum. The chart below outlines the payout levels of awards for each level of performance achieved:

2012 RPU Long-term Incentive Equity AwardsAward

Based on CompanyThe following table outlines the 2012 RPU targeted award opportunity, performance results, and the Company did not award any unrestricted or time-based restricted stock to our NEOsactual RPU payout for 2011. However, Matthew W. Morris did receive a grant of $67,920 of restricted stock in lieu of any payout under our historical formulaic incentive bonus award program. See “–Annual Incentive Bonus Awards” above for additional information.each NEO: