ITEM 8.01 Other Events.
As previously disclosed, Kingsway Financial Services Inc. ("Corporation" or
"Kingsway") has been delayed in filing certain of its periodic reports with the
Securities and Exchange Commission ("SEC"), including its Annual Report on Form
10-K for the fiscal year ended December 31, 2018. As a result of the delay, the
Corporation has been unable to make certain corporate governance disclosures
that otherwise would have been included in the Company's Form 10-K or annual
meeting proxy statement under Section 303A of the New York Stock Exchange
("NYSE") Listed Company Manual. The NYSE has advised the Corporation that it may
provide the required corporate governance disclosures through the filing of this
Current Report on Form 8-K.
Board of Directors
The Corporation's Board of Directors (the "Board") is comprised of the following
directors: John T. Fitzgerald, Gregory P. Hannon, Terence M. Kavanagh, Doug
Levine, and Joseph D. Stilwell. Information concerning the names, ages,
positions with the Company, tenure as a director, and business experience of
each director, is set forth below.
John T. Fitzgerald, 48, has been a director of the Corporation since April 2016
and has served as Chief Executive Officer of Kingsway since September 2018. Mr.
Fitzgerald joined Kingsway as Executive Vice President on April 21, 2016
following Kingsway's acquisition of Argo Management Group, a private equity
investment partnership co-founded by Mr. Fitzgerald in 2002. Effective March 8,
2017, Mr. Fitzgerald was appointed President and Chief Operating Officer of
Kingsway. Prior to co-founding Argo Management Group, Mr. Fitzgerald was
managing director of Adirondack Capital, LLC, a financial futures and
derivatives trading firm, and he was a seat-owner on the Chicago Board of Trade.
Mr. Fitzgerald was previously the CEO of Hunter MFG, LLP and, from 2006 to 2016,
Mr. Fitzgerald served as its Chairman. Mr. Fitzgerald also sits on the board of
directors of Atlas Financial Holdings, Inc. (NASDAQ: AFH). Mr. Fitzgerald
received a Bachelor of Science degree from DePaul University and is an MBA
graduate of the Kellogg School of Management, Northwestern University.
Gregory P. Hannon, 65, has been a director of the Corporation since September
2009 and serves on the Audit Committee and Nominating and Corporate Governance
Committee. Mr. Hannon has been a Vice-President and Director of Oakmont Capital
Inc., a Toronto-based private investment company, since 1997. He previously was
a founding partner of Lonrisk, a Toronto-based specialty insurer and subsidiary
of the London Insurance Group, where he was the Chief Financial Officer. Prior
to that, Mr. Hannon worked for the Continental Bank of Canada in commercial
credit and as auditor for Arthur Andersen and Company, Chartered Accountants.
Mr. Hannon received a Bachelor of Commerce degree from Queen's University in
1978 and an M.B.A. from The Harvard Business School in 1987.
Terence M. Kavanagh, 64, has been a director of the Corporation since April 2009
and serves on the Compensation and Management Resources Committee, the Audit
Committee and the Plan Committee. In addition, Mr. Kavanagh has served as
Chairman of the Board since September 2013. Mr. Kavanagh has, since 1997, served
as President and a Director of Oakmont Capital Inc., a Toronto-based private
investment company. Prior to co-founding Oakmont Capital, Mr. Kavanagh's
previous experience includes managing the Brentwood Pooled Investment Fund, a
North American based investment fund, and managing a number of family-owned
operating businesses in the real estate, property management and building
services industries. Mr. Kavanagh was previously an investment banker in New
York and Toronto with The First Boston Corporation and Lehman Brothers. Mr.
Kavanagh received a Bachelor of Law degree from Western University in 1978, and
an M.B.A. from the Tuck School of Business at Dartmouth College in 1982.
Doug Levine, 61, has been a director of the Corporation since May 2018 and
serves on the Audit Committee and Investment Committee. Mr. Levine has been the
President of Levine Management, a real estate developer, since January 2013. He
graduated in 1980 from Tufts University with a Bachelor's Degree in Economics.
Joseph D. Stilwell, 58, has been a director of the Corporation since April 2009
and serves on the Investment Committee, the Nominating and Corporate Governance
Committee, the Compensation and Management Resources Committee and the Plan
Committee. Mr. Stilwell is the owner and managing member of Stilwell Value LLC,
the General Partner of a group of funds known as The Stilwell Group. Mr.
Stilwell started his first fund in 1993 and has been reviewing and analyzing
financial statements and managing investment funds for well over 20 years. He
graduated in 1983 from the Wharton School at the University of Pennsylvania with
a Bachelor of Science in Economics.
Independent Directors
The Board has determined that the following directors are "independent" under
NYSE Rule 303A.02: Gregory P. Hannon, Terence M. Kavanagh, Doug Levine and
Joseph D. Stilwell (collectively, the "Independent Directors"). None of the
Independent Directors
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or any of their immediate family members has or had any of the disqualifying
relationships with the Corporation or the Corporation's subsidiaries specified
in NYSE Rule 303A.02.
Executive Sessions
To ensure that the non-management members of the Board provide effective
oversight over the Corporation, such non-management members of the Board meet
informally from time to time and in executive session during regularly
scheduled, in-person meetings of the Board. Mr. Kavanagh is the presiding
director for all executive sessions.
Communications with the Board
It is the Corporation's policy to forward to the directors any correspondence it
receives that is addressed to them. Shareholders, or other interested parties,
who wish to communicate with the directors may do so by sending their
correspondence addressed to the director or directors as follows: Kingsway
Financial Services Inc., Attention: Investor Relations, 150 Pierce Road, Suite
600, Itasca, IL 60143. Our directors' attendance at annual meetings can also
provide shareholders with an opportunity to communicate with directors about
issues affecting the Corporation. Our Corporate Governance Guidelines encourage
our directors to attend the annual meeting of shareholders. All of our directors
attended our 2018 annual meeting.
Code of Conduct and Ethics
The Corporation has adopted a written code of ethics, which was amended and
adopted by the Board on May 23, 2019, applicable to our directors, principal
executive officer, principal financial officer, and other senior financial
personnel. The Code of Business Conduct & Ethics is posted on the Corporation's
website at www.kingsway-financial.com/corporate-governance. Any future
amendments to the Corporation's code of ethics for senior financial personnel
and any grant of waiver from a provision of the code requiring disclosure under
applicable SEC rules will be disclosed in the "Corporate Governance" section of
our website.
Corporate Governance Guidelines and Committee Charters
The Corporation has adopted Corporate Governance Guidelines which comply with
the NYSE listing standards and corporate governance requirements of applicable
law. The Corporate Governance Guidelines were amended and adopted by the Board
on May 23, 2019 and are periodically reviewed. The Corporate Governance
Guidelines can be found on the Corporation's website at
www.kingsway-financial.com/corporate-governance. The responsibilities and duties
of the Audit Committee are set out in the Audit Committee's charter, which was
amended and adopted by the Board on May 23, 2019 and is available on the
Corporation's website at www.kingsway-financial.com. The responsibilities and
duties of the Compensation Committee are set out in the Compensation Committee's
Charter, which was amended and adopted by the Board on May 23, 2019 and is
available on the Corporation's website at www.kingsway-financial.com. The
responsibilities and duties of the Nominating and Corporate Governance Committee
are set out in the Nominating and Corporate Governance Committee's Charter,
which was amended and adopted by the Board on May 23, 2019 and is available on
the Corporation's website at www.kingsway-financial.com.
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