SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
(Amendment No. _____)*
UNDER THE SECURITIES EXCHANGE ACT OF 1934
Kingsway Financial Services Inc.
--------------------------------
(Name of Issuer)
Common Stock
------------
(Title of Class of Securities)
496904103
---------
(CUSIP Number)
Terence M. Kavanagh
45 St. Clair Avenue West, Suite 400
Toronto, Ontario, Canada M4V 1K9
Telephone: (416) 923-1477
with a copy to:
Daniel P. Raglan, Esq.
Torys LLP, 20th Floor
237 Park Avenue
New York, New York 10017
Telephone: (212) 880-6000
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
February 26, 2009
-----------------
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Sections 240.13d-1(e), 240.13d-1(f), or 240.13(d)-1(g),
check the following box. [ ]
* The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
CUSIP NO. 496904103 13D
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(1) Name of Reporting Persons. IRS Identification
Nos. of Above Persons (entities only)
Oakmont Capital Inc.
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(2) Check the Appropriate Box if a Member of a Group (See Instructions)
(a) (X)
(b) ( )
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(3) SEC Use Only
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(4) Source of Funds (See Instructions)
WC
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(5) Check if Disclosure of Legal Proceedings is
Required Pursuant to Items 2(d) or 2(e). ( )
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(6) Citizenship or Place of Organization
Ontario, Canada
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(7) Sole Voting Power
3,275,000
------------------------------------------
Number of (8) Shared Voting Power
Shares Beneficially
Owned 0
by Each ------------------------------------------
Reporting (9) Sole Dispositive Power
Person With
3,275,000
------------------------------------------
(10) Shared Dispositive Power
0
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(11) Aggregate Amount Beneficially Owned by Each Reporting Person
3,548,500 (See Item 5 herein)
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(12) Check if the Aggregate Amount in Row (11)
Excludes Certain Shares (See Instructions) ( )
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(13) Percent of Class Represented by Amount in Row (11)
6.44% (See Item 5 herein)
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(14) Type of Reporting Person (See Instructions)
CO
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CUSIP NO. 496904103 13D
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(1) Name of Reporting Persons. IRS Identification
Nos. of Above Persons (entities only)
E.J.K. Holdings Inc.
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(2) Check the Appropriate Box if a Member of a Group (See Instructions)
(a) (X)
(b) ( )
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(3) SEC Use Only
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(4) Source of Funds (See Instructions)
WC
--------------------------------------------------------------------------
(5) Check if Disclosure of Legal Proceedings is Required Pursuant to
Items 2(d) or 2(e). ( )
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(6) Citizenship or Place of Organization
Ontario, Canada
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(7) Sole Voting Power
24,000
-------------------------------------------
Number of (8) Shared Voting Power
Shares Beneficially
Owned 3,275,000
by Each -------------------------------------------
Reporting (9) Sole Dispositive Power
Person With
24,000
-------------------------------------------
(10) Shared Dispositive Power
3,275,000
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(11) Aggregate Amount Beneficially Owned by Each Reporting Person
3,548,500 (See Item 5 herein)
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(12) Check if the Aggregate Amount in Row (11)
Excludes Certain Shares (See Instructions) ( )
--------------------------------------------------------------------------
(13) Percent of Class Represented by Amount in Row (11)
6.44% (See Item 5 herein)
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(14) Type of Reporting Person (See Instructions)
CO
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CUSIP NO. 496904103 13D
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(1) Name of Reporting Persons. IRS Identification
Nos. of Above Persons (entities only)
1272562 Ontario Inc.
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(2) Check the Appropriate Box if a Member of a Group (See Instructions)
(a) (X)
(b) ( )
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(3) SEC Use Only
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(4) Source of Funds (See Instructions)
WC
---------------------------------------------------------------------------
(5) Check if Disclosure of Legal Proceedings is Required Pursuant to Items
2(d) or 2(e). ( )
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(6) Citizenship or Place of Organization
Ontario, Canada
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(7) Sole Voting Power
12,000
---------------------------------------------
Number of (8) Shared Voting Power
Shares Beneficially
Owned 3,275,000
by Each ---------------------------------------------
Reporting (9) Sole Dispositive Power
Person With
12,000
---------------------------------------------
(10) Shared Dispositive Power
3,275,000
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(11) Aggregate Amount Beneficially Owned by Each Reporting Person
3,548,500 (See Item 5 herein)
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(12) Check if the Aggregate Amount in Row (11)
Excludes Certain Shares (See Instructions) ( )
---------------------------------------------------------------------------
(13) Percent of Class Represented by Amount in Row (11)
6.44% (See Item 5 herein)
---------------------------------------------------------------------------
(14) Type of Reporting Person (See Instructions)
CO
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CUSIP NO. 496904103 13D
---------------------------------------------------------------------------
(1) Name of Reporting Persons. IRS Identification
Nos. of Above Persons (entities only)
Terence M. Kavanagh
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(2) Check the Appropriate Box if a Member of a Group (See Instructions)
(a) (X)
(b) ( )
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(3) SEC Use Only
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(4) Source of Funds (See Instructions)
PF
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(5) Check if Disclosure of Legal Proceedings is Required Pursuant to Items
2(d) or 2(e). ( )
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(6) Citizenship or Place of Organization
Canada
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(7) Sole Voting Power
113,500
---------------------------------------------
Number of (8) Shared Voting Power
Shares Beneficially
Owned 3,299,000
by Each ---------------------------------------------
Reporting (9) Sole Dispositive Power
Person With
113,500
---------------------------------------------
(10) Shared Dispositive Power
3,299,000
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(11) Aggregate Amount Beneficially Owned by Each Reporting Person
3,548,500 (See Item 5 herein)
---------------------------------------------------------------------------
(12) Check if the Aggregate Amount in Row (11)
Excludes Certain Shares (See Instructions) (X)
(See Item 5 herein)
---------------------------------------------------------------------------
(13) Percent of Class Represented by Amount in Row (11)
6.44% (See Item 5 herein)
---------------------------------------------------------------------------
(14) Type of Reporting Person (See Instructions)
IN
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CUSIP NO. 496904103 13D
---------------------------------------------------------------------------
(1) Name of Reporting Persons. IRS Identification
Nos. of Above Persons (entities only)
Gregory P. Hannon
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(2) Check the Appropriate Box if a Member of a Group (See Instructions)
(a) (X)
(b) ( )
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(3) SEC Use Only
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(4) Source of Funds (See Instructions)
PF
---------------------------------------------------------------------------
(5) Check if Disclosure of Legal Proceedings is Required Pursuant to Items
2(d) or 2(e). ( )
---------------------------------------------------------------------------
(6) Citizenship or Place of Organization
Canada
---------------------------------------------------------------------------
(7) Sole Voting Power
108,000
---------------------------------------------
Number of (8) Shared Voting Power
Shares Beneficially
Owned 3,303,000
by Each ---------------------------------------------
Reporting (9) Sole Dispositive Power
Person With
108,000
---------------------------------------------
(10) Shared Dispositive Power
3,303,000
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(11) Aggregate Amount Beneficially Owned by Each Reporting Person
3,548,500
---------------------------------------------------------------------------
(12) Check if the Aggregate Amount in Row (11)
Excludes Certain Shares (See Instructions) (X)
(See Item 5 herein)
---------------------------------------------------------------------------
(13) Percent of Class Represented by Amount in Row (11)
6.44%
---------------------------------------------------------------------------
(14) Type of Reporting Person (See Instructions)
IN
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ITEM 1. SECURITY AND ISSUER
This Schedule 13D relates to the shares ("Shares") of common stock, no par
value, of Kingsway Financial Services Inc. (the "Issuer"). The address of the
principal executive offices of the Issuer is 7120 Hurontario Street, Suite 800,
Mississauga, Ontario, Canada L5W 0A9.
ITEM 2. IDENTITY AND BACKGROUND
The persons filing this statement are Oakmont Capital Inc., an Ontario
corporation ("Oakmont"), E.J.K. Holdings Inc., an Ontario corporation ("EJK"),
1272562 Ontario Inc., an Ontario corporation ("1272562"), and Gregory P. Hannon
and Terence M. Kavanagh, each of whom are citizens of Canada (collectively, the
"Reporting Persons"). The principal business address and the address of the
principal office of each of the Reporting Persons is 45 St. Clair Avenue West,
Suite 400, Toronto, Ontario, Canada M4V 1K9.
Oakmont, EJK and 1272562 are primarily engaged in the business of
investing in securities. Each of EJK and 1272562 owns 50% of the outstanding
voting stock of Oakmont. Terence M. Kavanagh owns all of the voting stock of
EJK. Gregory P. Hannon owns all of the capital stock of 1272562. Terence M.
Kavanagh's present principal occupation or employment is acting as President,
Treasurer and a Director of Oakmont. Gregory P. Hannon's present principal
occupation or employment is acting as Vice President and Secretary and a
Director of Oakmont.
The name, citizenship, present principal occupation or employment and
business address of each director and executive officer of Oakmont, EJK and
1272562 is set forth in Schedule A attached hereto.
Neither Oakmont, EJK, 1272562, Mr. Kavanagh, Mr. Hannon, nor any executive
officer or director of Oakmont, EJK or 1272562 has, during the last five years,
(a) been convicted in a criminal proceeding (excluding traffic violations or
similar misdemeanors), or (b) been a party to a civil proceeding of a judicial
or administrative body of competent jurisdiction and as a result of such
proceeding was or is subject to a judgement, decree, or final order enjoining
future violations of, or prohibiting, or mandating activities subject to,
Federal or State securities laws or a finding of any violation with respect to
such laws.
Oakmont, EJK, 1272562, Mr. Kavanagh and Mr. Hannon may be regarded as a
group (the "Group") for purposes of Rule 13d-5 under the Securities Exchange Act
of 1934.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
The aggregate purchase price of the 3,548,500 Shares purchased by the
Reporting Persons was Cdn $26,114,475.05 (including commissions). The source of
funding for the purchase of these Shares was general working capital of each of
Oakmont, EJK and 1272562 and personal funds of each of Messrs Kavanagh and
Hannon.
ITEM 4. PURPOSE OF TRANSACTION
The Reporting Persons have acquired the Shares of the Issuer for
investment purposes. In that connection, the Reporting Persons may have their
representative meet with management, directors or other shareholders of the
Issuer from time to discuss the affairs of the Issuer. The Reporting Persons
intend to monitor the business and affairs of the Issuer, including its
financial performance, and depending upon these factors, market conditions and
other factors, the Reporting Persons may acquire additional shares of the Issuer
as they deem appropriate, in open market purchases, privately negotiated
transactions or otherwise. Alternatively, the Reporting Persons may dispose of
some or all of their Shares in the open market, in privately negotiated
transactions or otherwise. Except as described herein, no Reporting Person has
any plans or proposals which relate to, or could result in, any of the matters
referred to in paragraphs (a) through (j), inclusive, of Item 4 of Schedule 13D.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
(a) As of the close of business on February 26, 2009, the Reporting
Persons may be deemed to beneficially own, in the aggregate, 3,548,500 Shares,
representing approximately 6.44% of the Issuer's outstanding Shares (based upon
the Shares stated to be outstanding as of December 31, 2008 by the Issuer in its
press release on Form 6-K, furnished to the Securities and Exchange Commission
on February 20, 2009).
(b) Oakmont has sole voting power and sole dispositive power with respect
to the 3,275,000 Shares that it owns directly. Oakmont may be deemed to be a
beneficial owner of the balance of the 3,548,500 Shares beneficially owned by
the Group, by virtue of its participation in the Group.
EJK has sole voting power and sole dispositive power with respect to
the 24,000 Shares that it owns directly. EJK has shared voting power and shared
dispositive power with respect to the 3,275,000 Shares owned directly by
Oakmont, by virtue of EJK's ownership of 50% of the outstanding voting stock of
Oakmont and its right to nominate one of the two members of the Board of
Directors of Oakmont. EJK may be deemed to be a beneficial owner of the balance
of the 3,548,500 Shares beneficially owned by the Group, by virtue of its
participation in the Group.
1272562 has sole voting and sole dispositive power with respect to
12,000 Shares that it owns directly. 1272562 has shared voting power and shared
dispositive power with respect to the 3,275,000 Shares owned directly by
Oakmont, by virtue of its ownership of 50% of the outstanding voting stock of
Oakmont and its right to nominate one of the two members of the Board of
Directors of Oakmont. 1272562 may be deemed to be a beneficial owner of the
balance of the 3,548,500 Shares beneficially owned by the Group, by virtue of
its participation in the Group.
Mr. Kavanagh has sole voting power and sole dispositive power with
respect to 107,500 Shares owned through a self-directed Retirement Savings Plan,
5,500 Shares owned directly and 500 Shares owned directly by a trust for his
nephew (Mr. Kavanagh is the sole trustee). Mr. Kavanagh has shared voting power
and shared dispositive power with respect to the following Shares:
(i) the 24,000 Shares owned directly by EJK, by virtue of Mr.
Kavanagh's ownership of all of the outstanding voting stock of
EJK; and
(ii) the 3,275,000 Shares owned directly by Oakmont, by virtue of
Mr. Kavanagh's ownership of all the outstanding voting stock
of EJK, and EJK's ownership of 50% of the outstanding voting
stock of Oakmont and its right to nominate one of the two
members of the Board of Directors of Oakmont.
Mr. Kavanagh may be deemed to be a beneficial owner of the balance of the
3,548,500 Shares beneficially owned by the Group, by virtue of his participation
in the Group.
Mr. Kavanagh's sister owns directly and through a registered retirement
savings account 58,000 Shares and his mother owns, directly and through a
Retirement Income Fund, 60,000 Shares, as to which Mr. Kavanagh disclaims
beneficial ownership.
Mr. Hannon has sole voting power and sole dispositive power with respect
to the following Shares:
(i) the 90,000 Shares owned directly by him or through a self-
directed Retirement Savings Plan; and
(ii) the 18,000 Shares owned directly by two trusts for Mr.
Hannon's children; Mr. Hannon is the sole trustee of each such
trust.
Mr. Hannon has shared voting power and shared dispositive power with respect to
the following Shares:
(iii) the 12,000 Shares owned directly by 1272562, by virtue of Mr.
Hannon's ownership of all of the outstanding voting stock of
1272562;
(iv) the 16,000 Shares owned directly by Gilter Inc., an Ontario
corporation of which all of the outstanding voting stock is
owned by the Gregory Hannon Family Trust, of which Mr. Hannon
is one of two trustees; and
(v) the 3,275,000 Shares owned directly by Oakmont, by virtue of
his ownership all of the capital stock of 1272562, and
1272562's ownership of 50% of the outstanding voting stock of
Oakmont and its right to nominate one of the two members of
the Board of Directors of Oakmont.
Mr. Hannon may be deemed to be a beneficial owner of the balance of the
3,548,500 Shares beneficially owned by the Group, by virtue of his participation
in the Group.
Mr. Hannon's spouse owns directly 55,000 Shares, as to which Mr. Hannon
disclaims beneficial ownership.
(c) The following table sets forth all transactions with respect to Shares
effected during the past 60 days by any of the Reporting Persons. All such
transactions were effected in the open market.
Amount of
Date of Common Price Per Where and How
Transaction: Shares Common Share: Effected:
Transaction Purchased
Effected By: (Sold):
---------------------------- --------------- ------------- ----------------- -----------------
Oakmont Capital Inc. 12/29/08 16,200 $ 5.31 Open Market
Oakmont Capital Inc. 12/29/08 100 $ 5.45 Open Market
Oakmont Capital Inc. 12/30/08 7,400 $ 5.65 Open Market
Oakmont Capital Inc. 12/30/08 13,600 $ 6.11 Open Market
Oakmont Capital Inc. 12/31/08 4,000 $ 6.30 Open Market
Oakmont Capital Inc. 2/26/09 500,000 $ 2.50 Open Market
Oakmont Capital Inc. 2/26/09 500,000 $ 2.50 Open Market
T. Kavanagh RSP 12/31/08 3,300 $ 6.70 Open Market
T. Kavanagh RSP 12/31/08 6,300 $ 6.35 Open Market
T. Kavanagh RSP 12/31/08 400 $ 6.14 Open Market
T. Kavanagh RSP 2/23/09 6,500 $ 2.90 Transferred from
stock account
T. Kavanagh RSP 2/24/09 6,000 $ 2.72 Open Market
T. Kavanagh 2/23/09 (6,500) $ 2.90 Transferred to
Retirement
Savings Plan
EJK 2/24/09 (6,000) $ 2.72 Open Market
L. Winchell 2/25/09 16,000 $ 2.70 Open Market
(Mr. Kavanagh's sister)
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO
SECURITIES OF THE ISSUER
Except as described herein, none of the Reporting Persons nor any person
referred to in Schedule A attached hereto, has any contracts, arrangements,
understandings or relationships (legal or otherwise) with any person with
respect to any securities of the Issuer, including but not limited to the
transfer or voting of any of the securities, finder's fees, joint ventures, loan
or option arrangements, puts or calls, guarantees of profits, division of
profits or losses, or the giving or withholding of proxies.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
1. Joint Filing Agreement of the Reporting Persons
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: March 5, 2009
OAKMONT CAPITAL INC.
By /s/ Terence M. Kavanagh
------------------------------------
Terence M. Kavanagh
President
E.J.K. HOLDINGS INC.
By /s/ Terence M. Kavanagh
------------------------------------
Terence M. Kavanagh
President
1272562 ONTARIO INC.
By /s/ Gregory P. Hannon
------------------------------------
Gregory P. Hannon
President
/s/ Terence M. Kavanagh
---------------------------------------
Terence M. Kavanagh
/s/ Gregory P. Hannon
---------------------------------------
Gregory P. Hannon
SCHEDULE A
DIRECTORS AND EXECUTIVE OFFICERS OF THE REPORTING PERSONS
The following sets forth the name, position and principal occupation of
each director and executive officer of Oakmont, EJK and 1272562. Each such
person is a citizen of Canada. The business address of each such person is 45
St. Clair Avenue West, Suite 400, Toronto, Ontario, Canada M4V 1K9. To the best
of the Reporting Persons' knowledge, except as set forth in this Statement on
Schedule 13D, none of the directors or executive officers of the Reporting
Person owns any Shares of the Issuer.
REPORTING PRINCIPAL
PERSON NAME POSITION OCCUPATION
--------- ---- -------- ----------
Oakmont Terence M. Kavanagh President; Treasurer; Director See Item 2 herein
Gregory P. Hannon Vice President; Secretary; Director See Item 2 herein
EJK Terence M. Kavanagh President; Director See Item 2 herein
1272562 Gregory P. Hannon President; Director See Item 2 herein
EXHIBIT 1
FILING AGREEMENT
AMONG
OAKMONT CAPITAL INC.
AND
E.J.K. HOLDINGS INC.
AND
1272562 ONTARIO INC.
AND
TERENCE M. KAVANAGH
AND
GREGORY P. HANNON
In accordance with Rule 13d-1(f) under the Securities Exchange Act of
1934, as amended, the persons named below agree to the joint filing on behalf of
each of them of a statement on Schedule 13D (including amendments thereto) with
respect to the common stock, no par value, of Kingsway Financial Services Inc.,
and further agree that this Joint Filing Agreement be included as an Exhibit to
such joint filings. In evidence thereof, the undersigned, being duly authorized,
have executed this Joint Filing Agreement this 5th day of March, 2009.
OAKMONT CAPITAL INC.
By /s/ Terence M. Kavanagh
------------------------------------
Terence M. Kavanagh
President
E.J.K. HOLDINGS INC.
By /s/ Terence M. Kavanagh
------------------------------------
Terence M. Kavanagh
President
1272562 ONTARIO INC.
By /s/ Gregory P. Hannon
------------------------------------
Gregory P. Hannon
President
/s/ Terence M. Kavanagh
---------------------------------------
Terence M. Kavanagh
/s/ Gregory P. Hannon
---------------------------------------
Gregory P. Hannon