Shepard Urges Holders of Class B Common Stock of Donegal Group Inc. ("DGICB") to Tender Shares

CHICAGO, March 27, 2013

Mr. Shepard asks Class B shareholders:  "Do you want to receive a premium for your Class B shares?"  Mr. Shepard urges Class B shareholders to tender their shares and send a strong message to DGI management of the desire of the Class B shareholders to accept his Offer.

The DGI Board is currently deliberating whether to 1) recommend the Offer, 2) recommend against it, or 3) take no action and remain neutral.  The recommendation of the DGI Board is expected on Wednesday, April 3, 2013, on Schedule 14D-9.  Mr Shepard asks Class B stockholders to call Don Nikolaus, Chairman and CEO of DGI, at 800-877-0600, and Jeffrey Miller, Senior Vice President and Chief Financial Officer, at 717-426-1931, and urge them to endorse Mr. Shepard's Offer.

The Offer is not subject to any financing contingency.  Other conditions apply to the Offer, including the tender of at least 925,000 Class B shares, insurance and bank regulatory approvals, expiration or early termination of the Hart-Scott-Rodino waiting period, and no litigation involving the Offer.  Mr. Shepard is also seeking the appointment of three persons selected by him to the DGI Board and the board of Donegal Mutual Insurance Company ("Donegal Mutual"), as a condition of the Offer, without an increase in the size of each board from 12 directors. 

The Offer will expire on April 19, 2013 at 11:59 p.m., New York City time, unless extended.  Tenders of shares of DGI's Class B Common Stock must be made prior to the expiration of the Offer and may be withdrawn at any time prior to the expiration of the Offer.  Only shares properly tendered and not properly withdrawn pursuant to the Offer will be purchased.  The Offer includes withdrawal rights so that a tendering shareholder can freely withdraw any shares prior to acceptance of such shares for payment under the Offer.

Mr. Shepard is the beneficial owner of 3,602,900 Class A shares and 397,100 Class B shares of DGI, which he acquired at a total cost of $58.6 million.  Mr. Shepard has been a Class A and a Class B shareholder of DGI since 2005, and he is now by far DGI's largest shareholder with the exception of Donegal Mutual. 

This press release is neither an offer to purchase nor a solicitation of an offer to sell shares of DGI.  It does not purport to be complete and is qualified in its entirety by reference to the complete text of the Offer to Purchase and the related Letter of Transmittal, which contain important information that should be read carefully before any decision is made with respect to the Offer.