UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C FORM 8-K

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1 9/3/ K K 1 a8-k htm 8-K UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of report (Date of earliest event reported): August 18, 2014 KINGSWAY FINANCIAL SERVICES INC. (Exact Name of Registrant as Specified in Its Charter) Ontario, Canada (State or Other Jurisdiction of Incorporation) (Commission File Number) Not Applicable (IRS Employer Identification No.) 45 St. Clair Ave. West, Suite 400, Toronto, Ontario, Canada M4V 1K9 (Address of Principal Executive Offices) (Zip Code) Registrant s Telephone Number, Including Area Code: (416) Not Applicable (Former Name or Former Address, if Changed Since Last Report) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: o Written communications pursuant to Rule 425 under the Securities Act (17 CFR ) o o o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR a-12) Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR d-2(b)) Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR e-4(c)) 1/4

2 9/3/ K ITEM 7.01 REGULATION FD DISCLOSURE On August 18, 2014, the Company issued a press release regarding its intention to redeem its outstanding Series A Warrants, which were initially issued pursuant to its 2013 rights offering. In addition, the Company is planning to make available to investors an investor presentation via its website starting August 18, A copy of the press release and investor presentation is furnished as Exhibits 99.1 and 99.2 to this report. The information in this Form 8-K provided under Item 7.01 and Exhibits 99.1 and 99.2 attached hereto is being furnished to, and shall not be deemed filed with, the U.S. Securities and Exchange Commission or incorporated by reference into the Company s filings under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended. Item 9.01 Exhibit Number 99.1 Financial Statements and Exhibits. Exhibits Description News Release Dated August 18, Kingsway Announces Redemption of Outstanding Series A Warrants and Availability of Investor Presentation 99.2 Kingsway Financial Services Inc. Investor Presentation August /4

3 9/3/ K SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. KINGSWAY FINANCIAL SERVICES INC. August 18, 2014 By: /s/ Larry G. Swets, Jr. Larry G. Swets, Jr. President and Chief Executive Officer 3/4

4 9/3/ K EXHIBIT INDEX EXHIBIT NUMBER DESCRIPTION 99.1 News Release Dated August 18, Kingsway Announces Redemption of Outstanding Series A Warrants and Availability of Investor Presentation 99.2 Kingsway Financial Services Inc. Investor Presentation August /4

5 9/3/2014 Ex EX ex998-18x14.htm EXHIBIT 99.1 Kingsway Announces Redemption of Outstanding Series A Warrants and Availability of Investor Presentation TORONTO, August 18, 2014 /CNW/ - (TSX: KFS, NYSE: KFS) Kingsway Financial Services Inc. ("Kingsway" or the "Company") today announced its intention to redeem its outstanding Series A Warrants (TSX: KFS.WT.U, OTC: KFSWF), which were initially issued pursuant to its 2013 rights offering. Larry G. Swets, Jr., the Company s President and Chief Executive Officer, stated, The notice to redeem our Series A Warrants is another step in our turnaround, allowing us to improve our capital structure while providing us new capital to support our merchant banking activities if the warrant holders choose to exercise. A Notice of Redemption will be mailed to the holders of Series A Warrants on August 18, Holders of Series A Warrants will have until 5:00 p.m. Eastern Time on September 17, 2014 to exercise their outstanding Series A Warrants at US$4.50 per common share. Thereafter, any Series A Warrants that remain unexercised will automatically be redeemed by the Company at a redemption price of US$0.25 per Series A Warrant on September 18, 2014 (the Redemption Date ). The Company s Series B Warrants are unaffected by this intention to redeem, and all terms and conditions remain the same. The Notice of Redemption will be mailed to the holders of Series A Warrants given that the closing price of the Company's common shares has been US$6.00 per common share or higher on the New York Stock Exchange for twenty (20) consecutive trading days in accordance with the Series A Warrant redemption provisions. If all holders of Series A Warrants elect to exercise their Series A Warrants prior to the Redemption Date, approximately US$14.8 million of equity capital will be raised by the Company. If none of the holders of Series A Warrants exercise their Series A Warrants prior to the Redemption Date, Kingsway will redeem and cancel all Series A Warrants at an aggregate cost of approximately US$0.8 million. Updated Investor Presentation The Company also announced the availability of a new investor presentation on its website starting today, which can be accessed at About the Company Kingsway is a holding company functioning as a merchant bank with a focus on long-term value-creation. The Company owns or controls stakes in several insurance industry assets and utilizes its subsidiaries, 1347 Advisors LLC and 1347 Capital LLC, to pursue opportunities acting as an advisor, an investor and a financier. The common shares of Kingsway are listed on the Toronto Stock Exchange and the New York Stock Exchange under the trading symbol "KFS." Forward-Looking Statements This press release includes "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 that are not historical facts, and involve risks and uncertainties that could cause actual results to differ materially from those expected and projected. Words such as "expects", "believes", "anticipates", "intends", "estimates", "seeks" and variations and similar words and expressions are intended to identify such forward-looking statements. Such forward-looking statements relate to future events or future performance, but reflect Kingsway management's current beliefs, based on information currently available. A number of factors could cause actual events, performance or results to differ materially from the events, performance 1/2

6 9/3/2014 Ex and results discussed in the forward-looking statements. For information identifying important factors that could cause actual results to differ materially from those anticipated in the forward looking statements, please refer to the section entitled "Risk Factors" in the Company's 2013 Annual Report on Form 10-K. Except as expressly required by applicable securities law, the Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise. 2/2

7 EX investorpresentation8181.htm EXHIBIT 99.2 K I N G S W A Y F I N A N C I A L S E R V I C E S I N C. I N V E S T O R P R E S E N T A T I O N A U G U S T

8 F O R W A R D - L O O K I N G S T A T E M E N T S T h i s p r e s e n t a t i o n c o n t a i n s f o r w a r d - l o o k i n g s t a t e m e n t s r e l a t e d t o o u r f u t u r e g r o w t h, t r e n d s i n o u r o p e r a t i n g c o m p a n i e s ' b u s i n e s s e s a n d i n d u s t r i e s a n d o u r f i n a n c i a l a n d o p e r a t i o n a l r e s u l t s a n d p e r f o r m a n c e t h a t a r e b a s e d o n m a n a g e m e n t s c u r r e n t e x p e c t a t i o n s, f o r e c a s t s a n d a s s u m p t i o n s i n v o l v i n g r i s k s a n d u n c e r t a i n t i e s t h a t c o u l d c a u s e o u t c o m e s a n d r e s u l t s t o d i f f e r m a t e r i a l l y. A n u m b e r o f f a c t o r s c o u l d c a u s e a c t u a l e v e n t s, p e r f o r m a n c e o r r e s u l t s t o d i f f e r m a t e r i a l l y f r o m t h e e v e n t s, p e r f o r m a n c e a n d r e s u l t s d i s c u s s e d i n t h e f o r w a r d - l o o k i n g s t a t e m e n t s. F o r i n f o r m a t i o n i d e n t i f y i n g i m p o r t a n t f a c t o r s t h a t c o u l d c a u s e a c t u a l r e s u l t s t o d i f f e r m a t e r i a l l y f r o m t h o s e a n t i c i p a t e d i n t h e f o r w a r d - l o o k i n g s t a t e m e n t s, s e e K i n g s w a y 's s e c u r i t i e s f i l i n g s, i n c l u d i n g i t s A n n u a l R e p o r t o n F o r m K, u n d e r t h e h e a d i n g R i s k F a c t o r s. T h e s e c u r i t i e s f i l i n g s c a n b e a c c e s s e d o n t h e C a n a d i a n S e c u r i t i e s A d m i n i s t r a t o r s ' w e b s i t e a t w w w. s e d a r. c o m, a n d o n t h e E D G A R s e c t i o n o f t h e U. S. S e c u r i t i e s a n d E x c h a n g e C o m m i s s i o n 's w e b s i t e a t w w w. s e c. g o v o r t h r o u g h t h e C o m p a n y 's w e b s i t e a t w w w. k i n g s w a y - f i n a n c i a l. c o m. K i n g s w a y F i n a n c i a l S e r v i c e s I n c. d o e s n o t u n d e r t a k e t o u p d a t e t h e f o r w a r d - l o o k i n g s t a t e m e n t s t o r e f l e c t t h e i m p a c t o f c i r c u m s t a n c e s o r e v e n t s t h a t m a y a r i s e a f t e r t h e d a t e o f t h i s p r e s e n t a t i o n. A l l d o l l a r a m o u n t s s e t f o r t h i n t h i s p r e s e n t a t i o n a r e i n U. S. d o l l a r s. 2

9 V A L U E B U I L D I N G P H I L O S O P H Y 3 C o m p o u n d i n g c a p i t a l i n t h e l o n g t e r m w i t h i n v e s t m e n t s / a c q u i s i t i o n s / f i n a n c i n g s t h a t o f f e r a s y m m e t r i c r i s k / r e w a r d p o t e n t i a l w i t h a m a r g i n o f s a f e t y s u p p o r t e d b y p r i v a t e m a r k e t v a l u e s

10 R E D E M P T I O N O F S E R I E S A W A R R A N T S K i n g s w a y A t - A - G l a n c e T i c k e r K F S ( N Y S E ), K F S. T O ( T S X ) S t o c k P r i c e $ N Y S E ( a s o f 8 / 1 5 / ) S h a r e s O u t s t a n d i n g m i l l i o n M a r k e t C a p $ m i l l i o n ( a s o f 8 / 1 5 / ) U S H e a d q u a r t e r s I t a s c a, I l l i n o i s S e c t o r / I n d u s t r y F i n a n c i a l, I n s u r a n c e 4 S e r i e s A W a r r a n t T e r m s S t r i k e p r i c e : $ R e d e e m a b l e b y t h e C o m p a n y f o r $ u n d e r c e r t a i n c i r c u m s t a n c e s, w h i c h h a v e b e e n m e t W a r r a n t s t r a d e o n T S X u n d e r t i c k e r K F S. W T. U a n d o n O T C i n t h e U S u n d e r t i c k e r K F S W F T h i s w a r r a n t r e d e m p t i o n a p p l i e s o n l y t o K i n g s w a y s S e r i e s A W a r r a n t s. T h e C o m p a n y a l s o h a s S e r i e s B W a r r a n t s o u t s t a n d i n g, w h i c h a r e n o n - r e d e e m a b l e. T h e n o t i c e t o r e d e e m o u r S e r i e s A W a r r a n t s i s a n o t h e r s t e p i n o u r t u r n a r o u n d, a l l o w i n g u s t o i m p r o v e o u r c a p i t a l s t r u c t u r e w h i l e p r o v i d i n g u s n e w c a p i t a l t o s u p p o r t o u r m e r c h a n t b a n k i n g a c t i v i t i e s i f t h e w a r r a n t h o l d e r s c h o o s e t o e x e r c i s e. L a r r y S w e t s, C E O

11 R E D E M P T I O N O F S E R I E S A W A R R A N T S 5 W h y a w a r r a n t r e d e m p t i o n n o w? S t a b i l i z e d o p e r a t i o n s w i l l a l l o w t h e C o m p a n y t o u s e t h e p r o c e e d s f r o m e x e r c i s e d w a r r a n t s t o i m p r o v e i t s c a p i t a l s t r u c t u r e, t h r o u g h a d d i t i o n a l d e b t r e p a y m e n t, a n d p u r s u e o p p o r t u n i t i e s c o n s i s t e n t w i t h i t s m e r c h a n t b a n k i n g s t r a t e g y W h a t d o e s t h i s m e a n f o r w a r r a n t h o l d e r s? C o m p a n y s s t o c k i s t r a d i n g a t $ a s o f 8 / 1 5 / , a n d i n v e s t o r s c a n c h o o s e t o : E x e r c i s e w a r r a n t s a t a s t r i k e p r i c e o f $ o r R e c e i v e $ p e r w a r r a n t o w n e d a s o f 9 a. m. E a s t e r n T i m e o n 9 / 1 8 /

12 H O W W E T H I N K A B O U T B U I L D I N G V A L U E C o n c e n t r a t i o n o n i n s u r a n c e c o m p a n i e s, w h i c h p r o v i d e u n i q u e i n v e s t m e n t v e h i c l e s t o c o m p o u n d a n d l e v e r a g e i n v e s t m e n t r e s u l t s F o c u s o n a y e a r p e r s p e c t i v e w h e n c r e a t i n g / b u i l d i n g v a l u e, w h i l e r e c o g n i z i n g s h o r t - a n d n e a r - t e r m r e a l i t i e s C o n s i d e r u p s i d e a n d d o w n s i d e p r o b a b i l i t i e s, w i t h f o c u s o n i n v e s t i n g w h e n w e i g h t e d u p s i d e p o t e n t i a l i s m u l t i p l e s o f t h e d o w n s i d e L o o k i n g f o r c l a s s i c m a r g i n o f s a f e t y a s b u i l d i n g v a l u e i s n o t w i t h o u t i t s r i s k s F o c u s o n u n d e r s t a n d i n g p r i v a t e m a r k e t v a l u e s, w h i c h b e t t e r m a t c h l o n g - t e r m p e r s p e c t i v e 6 A L o n g - t e r m P e r s p e c t i v e C o m p o u n d i n g C a p i t a l A s y m m e t r i c R i s k / R e w a r d M a r g i n o f S a f e t y P r i v a t e M a r k e t V a l u e s C o m p o u n d i n g c a p i t a l i n t h e l o n g t e r m w i t h i n v e s t m e n t s / a c q u i s i t i o n s / f i n a n c i n g s t h a t o f f e r a s y m m e t r i c r i s k / r e w a r d p o t e n t i a l w i t h a m a r g i n o f s a f e t y s u p p o r t e d b y p r i v a t e m a r k e t v a l u e s

13 P O S I T I O N E D F O R G R O W T H I N B O O K V A L U E O p e r a t i o n s s t a b i l i z e d a s e x h i b i t e d b y : n o n - s t a n d a r d a u t o b o o k p r o f i t a b i l i t y s e r v i c e b u s i n e s s p r o f i t a b i l i t y r e d u c e d o v e r h e a d S t a b i l i t y w i t h i n t h e r i s k - b e a r i n g s u b s i d i a r i e s p r o v i d e s o p p o r t u n i t y f o r f u r t h e r i n v e s t m e n t i n t h e p a s s i v e p o r t f o l i o w i t h i t s h i g h e r r e t u r n p o t e n t i a l N e w c a p i t a l w i l l p r o v i d e o p p o r t u n i t i e s f o r f u t u r e g r o w t h o f c a p i t a l t h r o u g h i n v e s t m e n t i n v e h i c l e s l i k e C a p i t a l C o r p. ( N a s d a q : T F S C U ), K i n g s w a y s c u r r e n t s p e c i a l p u r p o s e a c q u i s i t i o n c o m p a n y ( S P A C ), a n d h i g h l y l e v e r a g e d t r i p l e n e t c r e d i t t e n a n t l e a s e s, w h i c h w i l l e n a b l e t h e C o m p a n y t o u s e i t s n e t o p e r a t i n g l o s s e s ( N O L s ) t o b u i l d v a l u e 7

14 O U R T R A C K R E C O R D F O R D E P L O Y I N G C A P I T A L P r o p e r t y I n s u r a n c e H o l d i n g s, I n c. ( N a s d a q : P I H ) K i n g s w a y, t h r o u g h i t s w h o l l y o w n e d m e r c h a n t b a n k, C a p i t a l, f o r m e d a L o u i s i a n a - b a s e d h o m e o w n e r s i n s u r e r i n P I H w e n t p u b l i c t h r o u g h a n I P O a n d h a d a s u c c e s s f u l f o l l o w - o n o f f e r i n g d u r i n g K i n g s w a y r e m a i n s t h e l a r g e s t s h a r e h o l d e r o f P I H a n d w i l l b e i s s u e d a d d i t i o n a l s h a r e s i f p r i c e t a r g e t s a r e m e t b y P I H s t o c k, i n a d d i t i o n t o e a r n i n g 1 % o f g r o s s w r i t t e n p r e m i u m i n p e r p e t u i t y f o r s u p p o r t i n g P I H I n v e s t m e n t P o r t f o l i o B o t h K i n g s w a y a n d i t s s u b s i d i a r i e s h a v e i n v e s t a b l e a s s e t s t a r g e t i n g o p p o r t u n i t i e s w i t h a s y m m e t r i c r i s k / r e w a r d p o t e n t i a l O n e r e c e n t e x a m p l e i n c l u d e s a $ 5 m i l l i o n r e a l i z e d g a i n i n t h e C o m p a n y s p o r t f o l i o o f p a s s i v e s e c u r i t i e s r e l a t e d t o a w a r r a n t w h i c h w a s p a c k a g e d w i t h a $ 1 m i l l i o n b r i d g e l o a n K i n g s w a y m a d e A c q u i s i t i o n s A c q u i s i t i o n s m a d e b y t h e c u r r e n t m a n a g e m e n t t e a m a r e c o n s i s t e n t w i t h K i n g s w a y s m e r c h a n t b a n k i n g s t r a t e g y w i t h a f o c u s o n l o n g - t e r m v a l u e c r e a t i o n 8

15 K E Y T A K E A W A Y S P r o c e e d s f r o m e x e r c i s e d w a r r a n t s w i l l e n a b l e K i n g s w a y t o e n h a n c e i t s b a l a n c e s h e e t w i t h a c a p i t a l s t r u c t u r e m o r e a l i g n e d w i t h t h e C o m p a n y s o p p o r t u n i t i e s a n d i n v e s t i n g t i m e h o r i z o n T h e c u r r e n t s t a b i l i t y o f K i n g s w a y s o p e r a t i n g e n t i t i e s p r o v i d e s t h e C o m p a n y w i t h c o n f i d e n c e t o m a k e f u r t h e r i n v e s t m e n t s i n a t t r a c t i v e o p p o r t u n i t i e s a s K i n g s w a y p u r s u e s i t s m e r c h a n t b a n k i n g s t r a t e g y t o c r e a t e v a l u e f o r i t s s h a r e h o l d e r s 9

16 C O N T A C T U S I n v e s t o r R e l a t i o n s T h e E q u i t y G r o u p C a r o l y n e Y. S o h n c s o h e q u i t y n y. c o m A d a m P r i o r a p r i o e q u i t y n y. c o m 1 0 K I N G S W A Y F I N A N C I A L S E R V I C E S I N C. I N V E S T O R P R E S E N T A T I O N A U G U S T

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