DEF 14A of KINGSWAY Corp
Filed Apr 9, 2025 · FY20240001174947-25-000543
PROPOSAL 1 - ELECTION OF DIRECTORS
PROPOSAL 1 - ELECTION OF DIRECTORS Our Certificate of Incorporation (our “Charter”) provides that the Board shall consist of a total number of directors as determined from time to time exclusively by resolution adopted by the Board. The Board has determined that the number of directors constituting the Board currently be set at eight. All director nominees are currently members of the Board and have been since the dates indicated in their respective profiles set forth below. It is contemplated that all of the nominees will be able to serve as directors; however, if a nominee should be unable to so serve for any reason prior to the Meeting, the persons named in the enclosed form of proxy reserve the right to vote for another nominee in their discretion. Each director elected will hold office until the next annual meeting of shareholders or until his/her successor is appointed and qualifies, unless his/her office is earlier vacated in accordance with the by-laws of the Corporation. In order to be elected, a director nominee must receive a plurality of votes cast. However, we have adopted a “Majority Election of Directors Policy” that provides that a director nominee who does not receive a majority (50% +1) of “FOR” votes cast at the Meeting in favor of his/her election in an uncontested election will be required to immediately submit his/her resignation to the Audit Committee and the resignation will be effective if/when accepted by the Board. The Audit Committee must make a recommendation to the Board to accept or reject the resignation, and the Board must act on the Audit Committee’s recommendation within 90 days of the Meeting. The Board shall accept the resignation absent extenuating circumstances. The Corporation will promptly issue a news release with the Board’s decision, and if the Board determines not to accept a resignation, the news release will state in full the reasons for that decision. A director who tenders a resignation pursuant to this policy will not participate in any meeting of the Board or any sub-committee of the Board at which the resignation is considered. A contested election is defined as a meeting at which the number of directors nominated for election is greater than the number of seats available on the Board. Management and the Board unanimously recommend that shareholders vote FOR the election of all of the nominees whose names are set forth on the following pages. In the absence of contrary instructions, the persons designated by management of the Corporation in the enclosed form of proxy intend to vote FOR the election of all of the nominees whose names are set forth on the following pages. Information set out below is as of March 31, 2025, unless otherwise indicated. Total compensation paid to the directors of the Corporation for the fiscal year ended December 31, 2024 is set out in the section entitled “Director Compensation” of the Proxy Statement.
Board of Directors and Director Nominees(1)
Board of Directors and Director Nominees(1)
Board of Directors and Director Nominees(1)
| Terence M. Kavanagh Age: 70 Residence: Ontario, Canada Director Since: April 23, 2009 Independent(2) | Terence M. 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. Mr. Kavanagh brings extensive knowledge of the financial services industry to the Board. | | | | Board Committee Membership: | Public Board Membership: | | | Board | None | | | Compensation & Management Resources Committee | | | | Investment Committee | |
Board of Directors and Director Nominees(1)
| John T. Fitzgerald Age: 53 Residence: Illinois, United States of America Director Since: April 21, 2016 Not independent | John T. Fitzgerald 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 received a Bachelor of Science degree from DePaul University and is an MBA graduate of the Kellogg School of Management, Northwestern University. Mr. Fitzgerald’s education, background and experience qualify him for his role with Kingsway. | | | | Board Committee Membership: | Public Board Membership: | | | Board | None |
Board of Directors and Director Nominees(1)
| Gregory P. Hannon Age: 70 Residence: Ontario, Canada Director Since: September 16, 2009 Independent(2) | Gregory P. 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. Mr. Hannon brings to the Board entrepreneurial experience, as well as expertise in accounting, auditing, and financialreporting. | | | | Board Committee Membership: | Public Board Membership: | | | Board | None | | | Audit Committee | | | | Nominating and Corporate Governance Committee | |
Board of Directors and Director Nominees(1)
| Joshua S. Horowitz Age: 47 Residence: New York, United States of America Director Since: March 31, 2025 Independent(2) | Joshua S. Horowitz is a professional investor with over 23 years of experience, specializing in portfolio management, problem solving, and board leadership. Since January 2012, he has served as a Portfolio Manager and Managing Director at several Palm entities, beginning with Palm Ventures LLC and currently with Palm Management (US) LLC, where he oversees the Palm Global Small Cap Master Fund. Prior to this, Mr. Horowitz was the Director of Research at Berggruen Holdings, a multi-billion-dollar family office, and a research analyst at Crossway Partners LP, focusing on value strategy investments. Mr. Horowitz also currently serves as a director on the boards of BK Technologies Corporation (NYSE: BKTI), NeuroMetrix Inc. (Nasdaq: NURO), Barnwell Industries, Inc. (NYSE: BRN) and Limbach Holdings, Inc. (NASDAQ: LMB). Mr. Horowitz holds a Bachelor of Science in Management from Binghamton University. | | | | Board Committee Membership: | Public Board Membership: | | | Board | BK Technologies Corporation (NYSE: BKTI) NeuroMetrix Inc. (Nasdaq: NURO) Barnwell Industries, Inc. (NYSE: BRN) Limbach Holdings, Inc. (NASDAQ: LMB) |
Board of Directors and Director Nominees(1)
| Douglas Levine Age: 66 Residence: Florida, United States of America Director Since: May 30, 2018 Independent(2) | Douglas 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. | | | | Board Committee Membership: | Public Board Membership: | | | Board | None | | | Investment Committee | |
Board of Directors and Director Nominees(1)
| Adam J. Patinkin Age: 40 Residence: Illinois, United States of America Director Since: March 31, 2025 Independent(2) | Adam J. Patinkin is the Founder and Managing Partner of David Capital Partners, LLC (“David Capital”) , a long-term oriented alternative investment firm headquartered in Chicago with offices in London. Prior to founding David Capital in 2011, Mr. Patinkin was a member of the investment team at Chicago-based Sheffield Asset Management, L.L.C., a long/short equity hedge fund manager, from 2007 to 2010. Mr. Patinkin currently serves on the Board of Directors of Flamingo Group, Inc., a privately held enterprise software company focused on the multi-family apartment industry. Mr. Patinkin holds the Chartered Financial Analyst designation. Mr. Patinkin earned a B.A. from Dartmouth College with a double major in History and Government in 2007. | | | | Board Committee Membership: | Public Board Membership: | | | Board | None |
Board of Directors and Director Nominees(1)
| Corissa B. Porcelli Age: 38 Residence: New Jersey, United States of America Director Since: September 21, 2020 Independent(2) | Corissa B. Porcelli began her career as an Analyst with The Stilwell Group. She was subsequently promoted and now serves as the Director of Research. Ms. Porcelli has extensive experience reviewing financial statements and analyzing and assessing the strengths and weaknesses of publicly traded companies. She has served on the boards of directors of numerous public companies. Ms. Porcelli is a CFA® charterholder. She graduated in 2008 from the University of Pennsylvania with a Bachelor of Arts in Economics and Psychology. | | | | Board Committee Membership: | Public Board Membership: | | | Board | Sound Financial Bancorp, Inc. since 2024 | | | Audit Committee | |
Board of Directors and Director Nominees(1)
| Joseph D. Stilwell Age: 63 Residence: San Juan, Puerto Rico Director Since: April 23, 2009 Independent(2) | Joseph D. Stilwell is the owner and managing member of Stilwell Value LLC ("Value"), the general partner of a group of private investment partnerships known as The Stilwell Group. Mr. Stilwell started his first investment fund in 1993. Since 2019, Mr. Stilwell also serves on the board of directors of Wheeler Real Estate Investment Trust, Inc., a commercial real estate investment company. Mr. Stilwell previously served on the boards of directors of American Physicians Capital, Inc. from November 2004 until it was acquired in October 2010 and SCPIE Holdings Inc. from December 2006 until it announced a sale of the company in Octobe 2007. Mr. Stilwell graduated from the Wharton School at the University of Pennsylvania with a Bachelor of Science in Economics in 1983. Mr. Stilwell has been chosen as a director based on his extensive experience and knowledge in capital allocation and maximizing stockholder value. Through the securities of the company held by The Stilwell Group's private investment partnerships and Mr. Stilwell directly, Mr. Stilwell holds a substantial position in Kingsway Financial Services, Inc. | | | | Board Committee Membership: | Public Board Membership: | | | Board | Director, Wheeler Real Estate Investment Trust since December 2019 and Silvergate Capital Corporation since September 2024 | | | Nominating and Corporate Governance Committee | | | | Compensation & Management Resources Committee | |
Board of Directors and Director Nominees(1)
| (1) All of the directors attended the 2024 annual meeting of shareholders except for Messrs. Levine and Stilwell. |
Board of Directors and Director Nominees(1)
| (2) “Independent” refers to the standards of independence established under section 301 of the Sarbanes-Oxley Act of 2002 (“SOX”) and the criteria for independence established by the NYSE and SEC. |
Board Committees
| (iii) | Oversee the annual performance evaluation of the Board and its committees and management; and |
2024 Summary Compensation Table
2024 Summary Compensation Table The following table provides information regarding the compensation of our named executive officers for the last two completed fiscal years.
2024 Summary Compensation Table
| Name and Principal Position | Year | Salary ($) | Bonus ($) | Stock Awards ($)(1) | Option Awards ($) | Non-Equity Incentive Plan Compensation ($) | All Other Compensation(2) ($) | Total ($) | | John T. Fitzgerald, President & Chief Executive Officer | 2024 | 600,000 | (3) | — | — | — | $37,250 | $637,250 | | | 2023 | 574,231 | — | — | — | — | 35,961 | 610,192 | | Kent A. Hansen., EVP & Chief Financial Officer | 2024 | 375,000 | (3) | 361,786 | — | — | $25,375 | $762,161 | | | 2023 | 371,250 | 70,000 | — | — | — | 25,813 | 467,063 |
2024 Summary Compensation Table
Notes:
2024 Summary Compensation Table
| (1) The amounts reported in these columns are valued based on the aggregate grant date fair value computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718, Compensation — Stock Compensation (“FASB ASC Topic 718”) and do not correspond to the actual value that might be realized by the NEOs. See Note 17 to the Financial Statements included in our Annual Report on Form 10-K for the year ended December 31, 2024 for a discussion of the relevant assumptions used in calculating the amounts reported. |
2024 Summary Compensation Table
| (2) For each named executive officer, amounts reported in this column include employer contributions to the Corporation’s 401(k) retirement plan and Employee Share Purchase Plan. |
2024 Summary Compensation Table
| (3) The bonus amounts for fiscal year 2024 have not been determined as of the date of the filing of this proxy statement. |
2024 Outstanding Equity Awards at Fiscal Year-End
2024 Outstanding Equity Awards at Fiscal Year-End
2024 Outstanding Equity Awards at Fiscal Year-End
| Option Awards | | | | | Stock Awards | | | Name | Number of Securities Underlying Unexercised Options Exercisable (#) | Number of Securities Underlying Unexercised Options Unexercisable (#) | Option Exercise Price ($) | Option Expiration Date | Number of Unearned Shares or Units That Have Not Vested (#)(1) | Market Value of Shares or Units That Have Not Vested ($)(2) | | John T. Fitzgerald | — | — | — | — | 400,000 | $3,348,000 | | Kent A. Hansen | — | — | — | — | 43,302 | $362,437 |
2024 Outstanding Equity Awards at Fiscal Year-End
Notes:
2024 Outstanding Equity Awards at Fiscal Year-End
| (1) Refer to” Voting Securities and Principal Holders” section on Page 2 for full vesting information. |
2024 Outstanding Equity Awards at Fiscal Year-End
| (2) The value of the Common Shares is based on the closing price of the Common Shares on the NYSE of $8.37 as of December 31, 2024, the last trading day of the fiscal year. |
Potential Payments Upon Termination or Change in Control
Potential Payments Upon Termination or Change in Control The Corporation maintains a severance policy (the “Severance Policy”) for the payment of certain benefits to certain eligible employees of the Corporation, but not our named executive officers. Benefits are paid under the Severance Policy following a termination of employment in connection with a reduction in work force. Under the Severance Policy, upon a qualifying termination of employment, the eligible participants are entitled to two weeks of severance pay for each full year of service with the Corporation, with a minimum of 12 weeks of severance pay and a maximum of 39 weeks of severance pay. Participants are also entitled to receive subsidized benefits as provided under the Consolidated Omnibus Budget Reconciliation Act during the severance period. In lieu of benefits under the Severance Policy, Mr. Fitzgerald is entitled to receive severance benefits under an individual severance agreement consisting of 12 months of base salary, paid in a lump sum, upon either (x) a termination of employment by the Corporation, other than for “Cause,” or (y) Mr. Fitzgerald’s resignation as a result of a “Constructive Termination,” subject, in each case, to Mr. Fitzgerald’s execution of a release of claims. As defined in Mr. Fitzgerald’s severance agreement, (A) “Cause” means Mr. Fitzgerald’s involuntary termination due to: (i) an intentional act of fraud, embezzlement, theft, or any other illegal act against the Corporation, any of which would constitute a felony; (ii) Mr. Fitzgerald’s improper disclosure or use of the Corporation’s confidential information but only where the Corporation has established that such disclosure or use has financially and materially injured the Corporation; or (iii) a material breach of Mr. Fitzgerald’s duty of loyalty to the Corporation but only where the Corporation has established that such breach has financially and materially injured the Corporation, and (B) “Constructive Termination” means Mr. Fitzgerald’s voluntary resignation within 45 days following written notice to each independent member of the Board setting forth in reasonable detail the occurrence of any of the following events without Mr. Fitzgerald’s written consent that is not cured by the Corporation within 30 days after such notice: (i) any material diminution in job duties and responsibilities or the imposition of job requirements materially inconsistent with Mr. Fitzgerald’s position with the Corporation; (ii) a reduction in Mr. Fitzgerald’s then-current base salary, other than an across-the-board reduction of no more than 10% in the base salary of all executive level employees; (iii) a material reduction in Mr. Fitzgerald’s annual incentive compensation opportunities; or (iv) Mr. Fitzgerald has established that he has been subject to a hostile work environment. In lieu of any severance benefits under the Severance Policy, Mr. Hansen’s offer letter instead provides that he is entitled to receive severance benefits of a lump sum payment equal to 100% of his then-current base salary for a termination of employment by the Corporation, other than a termination for “cause,” subject to Mr. Hansen’s execution of a release of claims.
2024 Pay Versus Performance
2024 Pay Versus Performance The following table sets forth information concerning: (1) the compensation of our Chief Executive Officer and President, John T. Fitzgerald and the average compensation for our other named executive officer, Kent A. Hansen, both as reported in the Summary Compensation Table and with certain adjustments to reflect the “compensation actually paid” ("CAP") to such individuals, as defined under SEC rules, for each of the fiscal years ended December 31, 2022, 2023 and 2024 and (2) our total shareholder return (“TSR”) and Net Income over such years in accordance with SEC rules:
2024 Pay Versus Performance
| Year | Summary Compensation Table Total for PEO | Compensation Actually Paid to PEO | Average Summary Compensation Table Total for Non-PEO NEO | Average Compensation Actually Paid to Non-PEO NEO | Value of Initial Fixed $100 Investment Based On Total Shareholder Return | Net Income (thousands) | | 2024 | 637,250 | 592,250 | 762,161 | 766,751 | $154.38 | -8,295 | | 2023 | $610,192 | $1,163,192 | $467,262 | $472,732 | $178.72 | $24,012 | | 2022 | $1,032,250 | $3,809,250 | $739,853 | $865,151 | $168.72 | $15,065 |
2024 Pay Versus Performance
(1) Mr. Fitzgerald was the Principal Executive Officer (“PEO”) in 2024, 2023 and 2022. (2) Mr. Hansen was the only Non-PEO Named Executive Officer (“NEO”) in 2024, 2023 and 2022. Officer compensation is determined by the Compensation Committee. In terms of base salary the Compensation Committee considers the market for similarly situated employees at peer companies and the employee’s overall performance both individually and as it relates to the overall results. Variable compensation considers profitability during the year. Compensation actually paid to the PEO and Non-PEO NEO in 2024, 2023 and 2022 were based upon 2024, 2023 and 2022 financial results, as well as the achievement of strategic objectives. The Compensation Committee also considered shareholder return as a factor in compensation, given the steady increase in our share price over the past few years.
Director Compensation
Director Compensation Narrative Description The Corporation’s director compensation program is designed to provide reasonable compensation for the risks and responsibilities of being a director. Only non-employee directors of the Board are remunerated for serving as directors of the Corporation. Non-employee directors received a single retainer fee, payable in quarterly installments in advance, in the amount of $80,000. The Chairmen of the Board and the Audit Committee each receive an additional $40,000 annually, also payable in quarterly installments in advance. 2024 Director Compensation The following table provides information regarding the compensation of our non-employee directors for 2024.
Director Compensation
| Name | Fees Earned or Paid in Cash ($)(1) | All Other Compensation ($) | Total ($) | | Terence M. Kavanagh | 120,000 | — | 120,000 | | Charles Frischer | 80,000 | — | 80,000 | | Gregory P. Hannon | 120,000 | — | 120,000 | | Joshua S. Horowitz(2) | — | — | — | | Douglas Levine | 80,000 | — | 80,000 | | Adam J. Patinkin(2) | — | — | — | | Corissa B. Porcelli | 80,000 | — | 80,000 | | Joseph D. Stilwell | 80,000 | — | 80,000 |
Director Compensation
Notes:
Director Compensation
| (1) Amounts reported in this column include the annual retainer paid to each non-employee director, plus an additional fee paid to each of Messrs. Kavanagh and Hannon for serving as Chairman of the Board and Chairman of the Audit Committee, respectively. |
Director Compensation
| (2) Messrs. Horowitz and Patinkin were appointed to the Board on March 31, 2025. |