UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
| (Mark One) | |||||
| | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||||
| For Quarterly Period Ended | |||||
| or | |||||
| | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||||
For the Transition Period from _____ to _____
Commission File Number:
Kingsway Corporation
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
| | ||
| (Address of principal executive offices and zip code) | ||
| 1- | ||
| (Registrant's telephone number, including area code) |
| Securities registered pursuant to Section 12(b) of the Act: |
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| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
| | |
Indicate by checkmark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.
| Large accelerated filer ☐ | | Non-accelerated filer ☐ | Smaller Reporting Company | Emerging Growth Company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes
The number of shares, including restricted common shares, outstanding of the registrant's common stock as of August 6, 2026 was
| Table Of Contents |
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| PART I - FINANCIAL INFORMATION |
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| ITEM 1. FINANCIAL STATEMENTS |
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| Consolidated Balance Sheets as of June 30, 2026 (unaudited) and December 31, 2025 |
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| Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2026 and 2025 (unaudited) |
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| Consolidated Statements of Comprehensive Loss for the Three and Six Months Ended June 30, 2026 and 2025 (unaudited) |
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| Consolidated Statements of Shareholders' Equity for the Three and Six Months Ended June 30, 2026 and 2025 (unaudited) | 6 |
| Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2026 and 2025 (unaudited) |
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| Notes to Consolidated Financial Statements (unaudited) |
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| ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS |
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| ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
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| ITEM 4. CONTROLS AND PROCEDURES |
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| PART II - OTHER INFORMATION |
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| ITEM 1. LEGAL PROCEEDINGS |
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| ITEM 1A. RISK FACTORS |
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| ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS |
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| ITEM 3. DEFAULTS UPON SENIOR SECURITIES |
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| ITEM 4. MINE SAFETY DISCLOSURES |
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| ITEM 5. OTHER INFORMATION |
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| ITEM 6. EXHIBITS |
|
| SIGNATURES |
|
| Kingsway Corporation |
(in thousands, except share data)
| June 30, 2026 | December 31, 2025 | |||||||
| (unaudited) | ||||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Restricted cash | ||||||||
| Investments (including $ and $, respectively, at fair value) (Note 6) | ||||||||
| Service fee receivable, net of allowance for credit losses of $ and $, respectively | ||||||||
| Deferred contract costs | ||||||||
| Other current assets | ||||||||
| Total current assets | ||||||||
| Deferred contract costs, noncurrent | ||||||||
| Property and equipment, net of accumulated depreciation of $ and $, respectively | ||||||||
| Goodwill | ||||||||
| Intangible assets, net of accumulated amortization of $ and $, respectively | ||||||||
| Other assets | ||||||||
| Total Assets | $ | $ | ||||||
| Liabilities, Redeemable Preferred Stock, Redeemable Noncontrolling Interest and Shareholders' Equity | ||||||||
| Current liabilities: | ||||||||
| Accrued expenses and other current liabilities | $ | $ | ||||||
| Deferred service fees | ||||||||
| Short-term and current portion of long-term debt | ||||||||
| Total current liabilities | ||||||||
| Deferred service fees | ||||||||
| Long-term debt (including $ and $, respectively, at fair value) (Note 10) | ||||||||
| Other liabilities, noncurrent | ||||||||
| Net deferred income tax liabilities | ||||||||
| Total Liabilities | ||||||||
| Redeemable preferred stock, $ par value; authorized, issued and outstanding at June 30, 2026 and December 31, 2025; redemption amount of $ at June 30, 2026 and December 31, 2025 | ||||||||
| Redeemable noncontrolling interest in consolidated subsidiary | ||||||||
| Shareholders' Equity: | ||||||||
| Common stock, $ par value; authorized; and issued at June 30, 2026 and December 31, 2025, respectively; and and outstanding at June 30, 2026 and December 31, 2025, respectively | ||||||||
| Additional paid-in capital | ||||||||
| Treasury stock, at cost; outstanding at June 30, 2026 and December 31, 2025 | ( | ) | ( | ) | ||||
| Accumulated deficit | ( | ) | ( | ) | ||||
| Accumulated other comprehensive income (loss) | ( | ) | ||||||
| Shareholders' equity attributable to common shareholders | ||||||||
| Noncontrolling interests in consolidated subsidiaries | ||||||||
| Total Shareholders' Equity | ||||||||
| Total Liabilities, Redeemable Preferred Stock, Redeemable Noncontrolling Interest and Shareholders' Equity | $ | $ | ||||||
See accompanying notes to unaudited consolidated financial statements.
Consolidated Statements of Operations
(in thousands, except per share data)
(Unaudited)
| Three months ended June 30, |
Six months ended June 30, |
|||||||||||||||
| 2026 |
2025 |
2026 |
2025 |
|||||||||||||
| Revenue |
$ | $ | $ | $ | ||||||||||||
| Cost of services |
||||||||||||||||
| Gross profit |
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| Selling, general and administrative expenses |
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| Depreciation expense |
||||||||||||||||
| Operating (loss) income |
( |
) | ( |
) | ( |
) | ||||||||||
| Other income (expenses), net: |
||||||||||||||||
| Interest and investment income, net |
||||||||||||||||
| Interest expense |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
| Amortization and impairment of intangible assets |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||
| Other income, net |
||||||||||||||||
| Gain on disposal of subsidiary |
||||||||||||||||
| Total other income (expenses), net |
( |
) | ( |
) | ( |
) | ||||||||||
| Income (loss) before income tax expense (benefit) |
( |
) | ( |
) | ( |
) | ||||||||||
| Income tax expense (benefit) |
( |
) | ( |
) | ||||||||||||
| Net income (loss) |
( |
) | ( |
) | ( |
) | ||||||||||
| Less: Net income (loss) attributable to: |
||||||||||||||||
| Noncontrolling interests in consolidated subsidiaries |
||||||||||||||||
| Redeemable noncontrolling interests in consolidated subsidiaries |
( |
) | ( |
) | ||||||||||||
| Less: Dividends on preferred stock |
||||||||||||||||
| Net loss attributable to common shareholders |
$ | ( |
) | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||
| Loss per share attributable to common shareholders: |
||||||||||||||||
| Basic |
$ | ( |
) | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||
| Diluted |
$ | ( |
) | $ | ( |
) | $ | ( |
) | $ | ( |
) | ||||
| Weighted-average shares outstanding (in ‘000s): |
||||||||||||||||
| Basic |
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| Diluted |
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See accompanying notes to unaudited consolidated financial statements.
Consolidated Statements of Comprehensive Loss
(in thousands)
(Unaudited)
| Three months ended June 30, | Six months ended June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Net income (loss) | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||||
| Other comprehensive (loss) income, net of taxes(1): | ||||||||||||||||
| Unrealized (losses) gains on available-for-sale investments: | ||||||||||||||||
| Unrealized (losses) gains arising during the period | ( | ) | ( | ) | ||||||||||||
| Reclassification adjustment for amounts included in net income (loss) | ( | ) | ( | ) | ||||||||||||
| Change in fair value of debt attributable to instrument-specific credit risk: | ||||||||||||||||
| Unrealized (losses) gains arising during the period | ( | ) | ( | ) | ( | ) | ||||||||||
| Other comprehensive (loss) income, net of taxes(1): | ( | ) | ( | ) | ||||||||||||
| Comprehensive loss | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Less: comprehensive income attributable to noncontrolling interests and redeemable noncontrolling interests in consolidated subsidiaries | ||||||||||||||||
| Comprehensive loss attributable to common shareholders | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
(1) Net of income tax expense (benefit) of $0 for the three and six months ended June 30, 2026 and June 30, 2025.
See accompanying notes to unaudited consolidated financial statements.
Consolidated Statements of Shareholders' Equity
(in thousands, except share data)
(Unaudited)
| Three Months Ended June 30, 2026 |
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| Common Stock |
Additional Paid-in Capital |
Treasury Stock |
Accumulated Deficit |
Accumulated Other Comprehensive Income |
Shareholders' Equity Attributable to Common Shareholders |
Noncontrolling Interests in Consolidated Subsidiaries |
Total Shareholders' Equity |
|||||||||||||||||||||||||||||
| Shares |
Amount |
|||||||||||||||||||||||||||||||||||
| Balance, March 31, 2026 |
$ | $ | $ | ( |
) | $ | ( |
) | $ | $ | $ | |||||||||||||||||||||||||
| Tax withholding related to net share settlement of restricted stock awards |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||||||||||||||||||
| Net (loss) income |
— | ( |
) | ( |
) | |||||||||||||||||||||||||||||||
| Preferred stock dividends |
— | ( |
) | ( |
) | ( |
) | |||||||||||||||||||||||||||||
| Distributions to noncontrolling interest holders |
— | ( |
) | ( |
) | |||||||||||||||||||||||||||||||
| Other comprehensive loss |
— | ( |
) | ( |
) | ( |
) | |||||||||||||||||||||||||||||
| Stock-based compensation |
— | |||||||||||||||||||||||||||||||||||
| Balance, June 30, 2026 |
$ | $ | $ | ( |
) | $ | ( |
) | $ | $ | $ | $ | ||||||||||||||||||||||||
| Three Months Ended June 30, 2025 | ||||||||||||||||||||||||||||||||||||
| Common Stock | Additional Paid-in Capital | Treasury Stock | Accumulated Deficit | Accumulated Other Comprehensive Loss | Shareholders' Equity Attributable to Common Shareholders | Noncontrolling Interests in Consolidated Subsidiaries | Total Shareholders' Equity | |||||||||||||||||||||||||||||
| Shares | Amount | |||||||||||||||||||||||||||||||||||
| Balance, March 31, 2025 | $ | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | $ | $ | ||||||||||||||||||||||
| Common stock issued at $ per share, net | ||||||||||||||||||||||||||||||||||||
| Net (loss) income | — | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||
| Preferred stock dividends | — | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||
| Other comprehensive loss | — | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||
| Stock-based compensation | — | |||||||||||||||||||||||||||||||||||
| Balance, June 30, 2025 | $ | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | $ | $ | ||||||||||||||||||||||
| Kingsway Corporation |
Consolidated Statements of Shareholders' Equity
(in thousands, except share data)
(Unaudited)
| Six Months Ended June 30, 2026 |
||||||||||||||||||||||||||||||||||||
| Common Stock |
Additional Paid-in Capital |
Treasury Stock |
Accumulated Deficit |
Accumulated Other Comprehensive (Loss) Income |
Shareholders' Equity Attributable to Common Shareholders |
Noncontrolling Interests in Consolidated Subsidiaries |
Total Shareholders' Equity |
|||||||||||||||||||||||||||||
| Shares |
Amount |
|||||||||||||||||||||||||||||||||||
| Balance, December 31, 2025 |
$ | $ | $ | ( |
) | $ | ( |
) | $ | ( |
) | $ | $ | $ | ||||||||||||||||||||||
| Tax withholding related to net share settlement of restricted stock awards |
( |
) | ( |
) | ( |
) | ( |
) | ||||||||||||||||||||||||||||
| Net (loss) income |
— | ( |
) | ( |
) | ( |
) | |||||||||||||||||||||||||||||
| Preferred stock dividends |
— | ( |
) | ( |
) | ( |
) | |||||||||||||||||||||||||||||
| Distributions to noncontrolling interest holders |
— | ( |
) | ( |
) | |||||||||||||||||||||||||||||||
| Other comprehensive income |
— | |||||||||||||||||||||||||||||||||||
| Stock-based compensation |
— | |||||||||||||||||||||||||||||||||||
| Balance, June 30, 2026 |
$ | $ | $ | ( |
) | $ | ( |
) | $ | $ | $ | $ | ||||||||||||||||||||||||
| Six Months Ended June 30, 2025 | ||||||||||||||||||||||||||||||||||||
| Common Stock | Additional Paid-in Capital | Treasury Stock | Accumulated Deficit | Accumulated Other Comprehensive Loss | Shareholders' Equity Attributable to Common Shareholders | Noncontrolling Interests in Consolidated Subsidiaries | Total Shareholders' Equity | |||||||||||||||||||||||||||||
| Shares | Amount | |||||||||||||||||||||||||||||||||||
| Balance, December 31, 2024 | $ | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | $ | $ | ||||||||||||||||||||||
| Common stock issued at $ per share, net | ||||||||||||||||||||||||||||||||||||
| Net (loss) income | — | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||
| Preferred stock dividends | — | ( | ) | ( | ) | ( | ) | |||||||||||||||||||||||||||||
| Repurchases of common stock | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||||||||||||||
| Other comprehensive income | — | |||||||||||||||||||||||||||||||||||
| Stock-based compensation | — | |||||||||||||||||||||||||||||||||||
| Balance, June 30, 2025 | $ | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | $ | $ | ||||||||||||||||||||||
See accompanying notes to unaudited consolidated financial statements.
Consolidated Statements of Cash Flows
(in thousands)
(Unaudited)
| Six months ended June 30, | ||||||||
| 2026 | 2025 | |||||||
| Cash provided by (used in): | ||||||||
| Operating activities: | ||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||
| Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||||||||
| Depreciation and amortization expense | ||||||||
| Stock-based compensation expense | ||||||||
| Net realized and unrealized investment gains | ( | ) | ( | ) | ||||
| Impairment of intangible assets | ||||||||
| Deferred income taxes | ( | ) | ( | ) | ||||
| Gain on disposal of subsidiary | ( | ) | ||||||
| Other non-cash items | ||||||||
| Changes in operating assets and liabilities, adjusted for assets and liabilities disposed of (2026) and acquired (2025): | ||||||||
| Service fee receivable, net | ( | ) | ( | ) | ||||
| Deferred contract costs | ( | ) | ( | ) | ||||
| Other assets | ( | ) | ||||||
| Deferred service fees | ||||||||
| Other, net | ( | ) | ||||||
| Net cash provided by (used in) operating activities | ( | ) | ||||||
| Investing activities: | ||||||||
| Proceeds from sales and maturities of fixed maturities | ||||||||
| Purchases of fixed maturities | ( | ) | ( | ) | ||||
| Net proceeds from limited liability investment, at fair value | ||||||||
| Net proceeds from investments in private companies | ||||||||
| Net proceeds from disposal of subsidiary, net of cash disposed of $ | ||||||||
| Net working capital settlements and escrow releases related to acquisitions | ||||||||
| Acquisition of businesses, net of cash acquired | ( | ) | ||||||
| Acquisition of assets | ( | ) | ||||||
| Net purchases of property and equipment | ( | ) | ( | ) | ||||
| Other, net | ( | ) | ( | ) | ||||
| Net cash provided by (used in) investing activities | ( | ) | ||||||
| Financing activities: | ||||||||
| Proceeds from issuance of common stock, net | ||||||||
| Proceeds from issuance of preferred stock | ||||||||
| Cash paid for repurchase of common stock | ( | ) | ||||||
| Distributions to noncontrolling interest holders | ( | ) | ||||||
| Payment of preferred stock dividends | ( | ) | ( | ) | ||||
| Payment of contingent consideration from acquisition | ( | ) | ||||||
| Taxes paid related to net share settlements of restricted stock awards | ( | ) | ||||||
| Principal proceeds from debt, net of debt issuance costs of in 2026 and $ in 2025 | ||||||||
| Principal payments on debt | ( | ) | ( | ) | ||||
| Net cash (used in) provided by financing activities | ( | ) | ||||||
| Net (decrease) increase in cash and cash equivalents and restricted cash | ( | ) | ||||||
| Cash and cash equivalents and restricted cash at beginning of period | ||||||||
| Cash and cash equivalents and restricted cash at end of period | $ | $ | ||||||
| June 30, |
||||||||
| 2026 |
2025 |
|||||||
| Reconciliation of cash and cash equivalents and restricted cash to the consolidated balance sheets: |
||||||||
| Cash and cash equivalents |
$ | $ | ||||||
| Restricted cash |
||||||||
| Cash and cash equivalents and restricted cash per statements of cash flows |
$ | $ | ||||||
| Six months ended June 30, |
||||||||
| 2026 |
2025 |
|||||||
| Non-cash financing activities: |
||||||||
| Notes receivable related to disposal of subsidiary |
$ | ( |
) | $ | ||||
| Notes payable issued for acquisitions of assets and business, net of discount |
$ | $ | ||||||
See accompanying notes to unaudited consolidated financial statements.
| Notes to Consolidated Financial Statements (Unaudited) June 30, 2026 |
NOTE 1 BUSINESS
On May 18, 2026, following shareholder approval, Kingsway Financial Services Inc. changed its name to Kingsway Corporation (the "Company" or "Kingsway") and began trading on the New York Stock Exchange under a new ticker symbol, KWY, on May 19, 2026. Kingsway is a Delaware holding company with operating subsidiaries located in the United States and is the only publicly-traded US company employing the Search Fund model to acquire and build great businesses. The Company owns and operates a collection of high-quality B2B and B2C services companies that are asset-light, growing, and that have recurring revenues. Kingsway seeks to compound long-term shareholder value on a per share basis via its decentralized management model, its talented team of operators, and its tax-advantaged corporate structure.
NOTE 2 BASIS OF PRESENTATION
The accompanying unaudited consolidated interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and notes required by U.S. GAAP for complete financial statements of the Company. In the opinion of management, all adjustments necessary for a fair presentation have been included and are of a normal recurring nature. Interim results are not necessarily indicative of the results that may be expected for the year.
The accompanying unaudited consolidated interim financial statements and footnotes should be read in conjunction with the audited consolidated financial statements and footnotes included within our Annual Report on Form 10-K ("2025 Annual Report") for the year ended December 31, 2025.
The unaudited consolidated interim financial statements include the accounts of the Company and its subsidiaries, as well as certain variable interest entities as further described in Note 6, "Variable Interest Entities," to the consolidated financial statements in the 2025 Annual Report. All material intercompany transactions and balances have been eliminated in consolidation.
The preparation of consolidated financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts and classifications of assets and liabilities, revenues and expenses, and the related disclosures of contingent assets and liabilities in the consolidated financial statements and accompanying notes. Actual results could differ from these estimates. Estimates and their underlying assumptions are reviewed on an ongoing basis. Changes in estimates are recorded in the accounting period in which they are determined.
The critical accounting estimates and assumptions in the accompanying unaudited consolidated interim financial statements include, but are not limited to, revenue recognition; valuation of fixed maturity investments; impairment assessment of investments; valuation of limited liability investment, at fair value; valuation of deferred income taxes; accounting for business combinations; valuation and impairment assessment of intangible assets; goodwill recoverability; valuation of contingent consideration; fair value assumptions for subordinated debt obligations; fair value assumptions for subsidiary stock-based compensation awards; and valuation of redeemable noncontrolling interest.
NOTE 3 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
There have been no material changes to our significant accounting policies as reported in our 2025 Annual Report.
NOTE 4 RECENTLY ISSUED ACCOUNTING STANDARDS
(a) Adoption of New Accounting Standards:
Effective January 1, 2026, the Company adopted ASU 2025-05, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets ("ASU 2025-05"), which amends the guidance on measuring expected credit losses using a probabilistic method and provides a practical expedient for all entities that simplifies the estimation of expected credit losses for current trade accounts receivable and contract assets arising from revenue transactions. The adoption of ASU 2025-05 did not have an impact on the Company's consolidated financial statements.
(b) Accounting Standards Not Yet Adopted:
In October 2023, the Financial Accounting Standards Board ("FASB") issued ASU 2023-06, Disclosure Improvements: Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative ("ASU 2023-06"), which amends the disclosure or presentation requirements related to various subtopics in the FASB Accounting Standards Codification. For SEC registrants, the effective date for each amendment will be the date on which the SEC’s removal of that related disclosure requirement from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited. The Company will monitor the removal of various requirements from the current regulations in order to determine when to adopt the related amendments, but does not anticipate the adoption of the new guidance will have a material impact on the Company’s consolidated financial statements. The Company will continue to evaluate the impact of this guidance on its consolidated financial statements.
In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures ("ASU 2024-03"). ASU 2024-03 requires new financial statement disclosures within the footnotes in tabular format, disaggregating information about prescribed categories underlying any relevant income statement expense caption. Qualitative disclosures about any remaining amounts in relevant expense line items must be provided. Separate disclosures of total selling expenses and an entity’s definition of those expenses are also required. ASU 2024-03 is effective for public companies with annual periods beginning after December 15, 2026, and interim periods within annual period beginning after December 15, 2027, with early adoption permitted. The Company expects the adoption of the standard to result in additional disaggregation of expense captions within its footnote disclosures.
| Kingsway Corporation Notes to Consolidated Financial Statements (Unaudited) June 30, 2026 |
In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, to modernize the accounting guidance for the costs to develop software for internal use. ASU 2025-06 applies to costs incurred to develop or obtain software for internal use and amends the existing standard that refers to various stages of a software development project to align better with current software development methods. Under ASU 2025-06, entities will commence capitalizing eligible costs when (i) management has authorized and committed to funding the software project, and (ii) it is probable that the project will be completed and the software will be used to perform the function intended. ASU 2025-06 is effective for public business entities for fiscal years beginning after December 15, 2027, and interim periods within those fiscal years. Early adoption is permitted for any interim period. The Company does not anticipate the adoption of the new guidance will have a material impact on the Company’s consolidated financial statements. The Company will continue to evaluate the impact of this guidance on its consolidated financial statements.
NOTE 5 ACQUISITIONS AND DISPOSAL
(a) Acquisitions:
During the three and six months ended June 30, 2025, the Company incurred acquisition expenses related to business combinations of $
The following acquisitions were accounted for as business combinations using the acquisition method of accounting. The purchase price for each acquisition was provisionally allocated to the assets acquired and liabilities assumed based on their estimated fair values at the date of acquisition and are subject to adjustment during a measurement period subsequent to the acquisition date, not to exceed one year, as permitted under U.S. GAAP. The Company records measurement period adjustments in the period in which the adjustments occur.
The goodwill recognized for each acquisition represents the premium paid over the fair value of the net tangible and intangible assets acquired, which the Company paid to grow its portfolio of companies and acquire an assembled workforce. The goodwill is not deductible for tax purposes.
M.L.C. Plumbing, LLC (d/b/a Bud's Plumbing)
On March 14, 2025, the Company acquired
During the third quarter of 2025, the Company finalized its fair value analysis of the assets acquired and liabilities assumed with the assistance of a third party.
The consolidated statements of operations include the earnings of Bud's Plumbing from the date of acquisition. From the date of acquisition through June 30, 2025, Bud's Plumbing earned revenue of $
The seller note was due to mature on April 1, 2030; however, on August 7, 2025, the seller note was repaid in full to the seller of Bud's Plumbing in exchange for shares of Kingsway common stock.
Roundhouse Electric & Equipment Co., Inc.
On July 1, 2025, the Company acquired
During the second quarter of 2026, the Company finalized its fair value analysis of the assets acquired and liabilities. During the six months ended June 30, 2026, the Company recorded a measurement period adjustment that decreased goodwill by $
| Kingsway Corporation Notes to Consolidated Financial Statements (Unaudited) June 30, 2026 |
AAA Flexible Pipe Cleaning Corporation (d/b/a AAA Advanced Plumbing & Drain)
On August 1, 2025, the Company (through its newly formed subsidiary, Advanced Plumbing & Drain LLC) acquired substantially all of the assets and certain specified liabilities of AAA Flexible Pipe Cleaning Corporation (d/b/a AAA Advanced Plumbing & Drain, "Advanced Plumbing") for aggregate consideration consisting of cash, a seller note and contingent consideration, of approximately $
Efficient Plumbing, LLC (d/b/a Southside Plumbing)
On August 14, 2025, the Company acquired
Bud’s Plumbing (Evansville, IN), Advanced Plumbing (Cleveland, OH) and Southside Plumbing (Omaha, NE), provide various plumbing installation, service and repair services to residential and commercial customers. As further discussed in Note 21, "Segmented Information," these companies are included in the Kingsway Search Xcelerator segment.
Summary Information
The following table summarizes the purchase price for our acquisitions:
| (in thousands) | Bud's Plumbing | Roundhouse | Advanced Plumbing | Southside Plumbing | ||||||||||||
| March 14, 2025 | July 1, 2025 | August 1, 2025 | August 14, 2025 | |||||||||||||
| Purchase price: | ||||||||||||||||
| Cash paid at closing | $ | $ | $ | $ | ||||||||||||
| Working capital adjustment | ( | ) | ( | ) | ( | ) | ||||||||||
| Seller note | ||||||||||||||||
| Release of indemnity escrow | ( | ) | ||||||||||||||
| Seller phantom equity awards | ||||||||||||||||
| Contingent consideration | ||||||||||||||||
| Total purchase price | $ | $ | $ | $ | ||||||||||||
The estimated fair value of the Roundhouse seller phantom equity awards at the acquisition date of $
The estimated fair value of the Advanced Plumbing and Southside Plumbing contingent consideration obligations at the respective acquisition dates of $
| Kingsway Corporation Notes to Consolidated Financial Statements (Unaudited) June 30, 2026 |
The following table summarizes the allocation of the purchase price and the estimated fair values of the assets acquired and liabilities assumed for our acquisitions:
| (in thousands) | Bud's Plumbing | Roundhouse | Advanced Plumbing | Southside Plumbing | ||||||||||||
| March 14, 2025 | July 1, 2025 | August 1, 2025 | August 14, 2025 | |||||||||||||
| Purchase price | $ | $ | $ | $ | ||||||||||||
| Cash and cash equivalents | $ | $ | $ | $ | ||||||||||||
| Service fee receivable | ||||||||||||||||
| Property and equipment | ||||||||||||||||
| Intangible asset not subject to amortization - trade name | ||||||||||||||||
| Intangible asset subject to amortization - customer relationships | ||||||||||||||||
| Other assets - other receivables, inventory and prepaid expenses | ||||||||||||||||
| Total assets | $ | $ | $ | $ | ||||||||||||
| Accrued expenses and other liabilities | $ | $ | $ | $ | ||||||||||||
| Debt | ||||||||||||||||
| Income taxes payable | ||||||||||||||||
| Net deferred income tax liabilities | ||||||||||||||||
| Total liabilities | $ | $ | $ | $ | ||||||||||||
| Total identifiable assets and liabilities | $ | $ | $ | $ | ||||||||||||
| Redeemable noncontrolling interest | $ | $ | $ | $ | ||||||||||||
| Excess purchase price allocated to goodwill | $ | $ | $ | $ | ||||||||||||
The fair value of the acquired service fee receivables in the table above are equivalent to their gross contractual amounts.
The fair value of the
(b) Disposal:
Trinity Warranty Solutions
On May 8, 2026, pursuant to a membership interest purchase agreement, the Company sold all of the issued and outstanding equity interests of its subsidiary, Trinity Warranty Solutions LLC ("Trinity"), to Trinity Warranty Holding LLC ("Buyer") for gross proceeds of $
As a result of the sale, the Company recognized a net gain on disposal of $
The sale of Trinity represents the disposal of a subsidiary of the Company, which had contributions to Extended Warranty revenue of $
NOTE 6 INVESTMENTS
Investments at June 30, 2026 and December 31, 2025 are comprised as follows:
| (in thousands) | June 30, 2026 | December 31, 2025 | ||||||
| Available-for-sale fixed maturities, at fair value (amortized cost of $ and $, respectively) | $ | $ | ||||||
| Limited liability investment, at fair value (a) | ||||||||
| Limited liability investments (a) | ||||||||
| Investments in private companies, at adjusted cost (a) | ||||||||
| Short-term investments, at cost which approximates fair value | ||||||||
| Total investments | $ | $ |
| (a) | Included in other assets in the consolidated balance sheets. |
| KINGSWAY CORPORATION June 30, 2026 |
The amortized cost, gross unrealized gains and losses included in accumulated other comprehensive income (loss), and estimated fair value of the Company's available-for-sale investments at June 30, 2026 and December 31, 2025 are summarized in the tables shown below:
| (in thousands) | June 30, 2026 | |||||||||||||||
| Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value | |||||||||||||
| Fixed maturities: | ||||||||||||||||
| U.S. government, government agencies and authorities | $ | $ | $ | $ | ||||||||||||
| States, municipalities and political subdivisions | ||||||||||||||||
| Mortgage-backed | ||||||||||||||||
| Asset-backed | ||||||||||||||||
| Corporate | ||||||||||||||||
| Total fixed maturities | $ | $ | $ | $ | ||||||||||||
| (in thousands) | December 31, 2025 | |||||||||||||||
| Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value | |||||||||||||
| Fixed maturities: | ||||||||||||||||
| U.S. government, government agencies and authorities | $ | $ | $ | $ | ||||||||||||
| States, municipalities and political subdivisions | ||||||||||||||||
| Mortgage-backed | ||||||||||||||||
| Asset-backed | ||||||||||||||||
| Corporate | ||||||||||||||||
| Total fixed maturities | $ | $ | $ | $ | ||||||||||||
The table below summarizes the Company's fixed maturities at June 30, 2026 by contractual maturity periods. Actual results may differ as issuers may have the right to call or prepay obligations, with or without penalties, prior to the contractual maturity of these obligations.
| (in thousands) | June 30, 2026 | |||||||
| Amortized Cost | Estimated Fair Value | |||||||
| Due in one year or less | $ | $ | ||||||
| Due after one year through five years | ||||||||
| Due after five years through ten years | ||||||||
| Due after ten years | ||||||||
| Total | $ | $ | ||||||
| KINGSWAY CORPORATION June 30, 2026 |
The following tables highlight the aggregate unrealized loss position, by security type, of available-for-sale investments in unrealized loss positions where
| (in thousands) | June 30, 2026 | |||||||||||||||||||||||
| Less than 12 Months | Greater than 12 Months | Total | ||||||||||||||||||||||
| Estimated Fair Value | Unrealized Loss | Estimated Fair Value | Unrealized Loss | Estimated Fair Value | Unrealized Loss | |||||||||||||||||||
| Fixed maturities: | ||||||||||||||||||||||||
| U.S. government, government agencies and authorities | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
| States, municipalities and political subdivisions | ||||||||||||||||||||||||
| Mortgage-backed | ||||||||||||||||||||||||
| Asset-backed | ||||||||||||||||||||||||
| Corporate | ||||||||||||||||||||||||
| Total fixed maturities | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
| (in thousands) | December 31, 2025 | |||||||||||||||||||||||
| Less than 12 Months | Greater than 12 Months | Total | ||||||||||||||||||||||
| Estimated Fair Value | Unrealized Loss | Estimated Fair Value | Unrealized Loss | Estimated Fair Value | Unrealized Loss | |||||||||||||||||||
| Fixed maturities: | ||||||||||||||||||||||||
| U.S. government, government agencies and authorities | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
| States, municipalities and political subdivisions | ||||||||||||||||||||||||
| Mortgage-backed | ||||||||||||||||||||||||
| Asset-backed | ||||||||||||||||||||||||
| Corporate | ||||||||||||||||||||||||
| Total fixed maturities | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
At June 30, 2026 and December 31, 2025, there are approximately
| Kingsway Corporation Notes to Consolidated Financial Statements (Unaudited) June 30, 2026 |
The establishment of an impairment loss on an investment requires a number of judgments and estimates. Refer to the "Significant Accounting Policies and Critical Estimates" section of Management's Discussion and Analysis of Financial Condition included in the 2025 Annual Report for further information regarding the Company's detailed analysis and factors considered in recording an impairment loss on an investment.
The Company did not record any write-downs for impairment related to limited liability investments or investments in private companies for the three and six months ended June 30, 2026 and June 30, 2025.
At June 30, 2026, the Company had no unfunded commitments related to limited liability investments or limited liability investment, at fair value.
For the three and six months ended June 30, 2026 and June 30, 2025, the Company did record any adjustments to the carrying value of its investments in private companies for observable price changes.
Interest and investment income, net reported in the consolidated statements of operations for the three and six months ended June 30, 2026 and June 30, 2025 are comprised as follows:
| (in thousands) | Three months ended June 30, | Six months ended June 30, | ||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Net investment income | $ | $ | ||||||||||||||
| Net realized gains | ||||||||||||||||
| Gain on change in fair value of limited liability investment, at fair value | ||||||||||||||||
| Interest and investment income, net | $ | $ | $ | $ | ||||||||||||
Net investment income included in interest and investment income, net in the table above for the three and six months ended June 30, 2026 and June 30, 2025 is comprised as follows:
| (in thousands) | Three months ended June 30, | Six months ended June 30, | ||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Investment income: | ||||||||||||||||
| Interest from fixed maturities | $ | $ | $ | $ | ||||||||||||
| Dividends | ||||||||||||||||
| Loss from limited liability investments | ( | ) | ( | ) | ||||||||||||
| Other | ||||||||||||||||
| Gross investment income | ||||||||||||||||
| Investment expenses | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Net investment income | $ | $ | $ | $ | ||||||||||||
Net realized gains on investments included in interest and investment income, net in the table above for the three and six months ended June 30, 2026 and June 30, 2025 are comprised as follows:
| (in thousands) | Three months ended June 30, | Six months ended June 30, | ||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Available-for-sale fixed maturities: | ||||||||||||||||
| Gross realized gains | $ | $ | $ | $ | ||||||||||||
| Gross realized losses | ( | ) | ( | ) | ||||||||||||
| Net realized losses on available-for-sale fixed maturities | ( | ) | ( | ) | ||||||||||||
| Limited liability investment, at fair value | ||||||||||||||||
| Investments in private companies | ||||||||||||||||
| Net realized gains | $ | $ | $ | $ | ||||||||||||
Realized gains related to limited liability investment, at fair value and investments in private companies relate to distributions received by the Company from these investments in excess of invested capital.
Proceeds from sales of available-for-sale fixed maturities were for the three and six months ended June 30, 2026 ($
| Kingsway Corporation Notes to Consolidated Financial Statements (Unaudited) June 30, 2026 |
NOTE 7 GOODWILL
The following table summarizes the goodwill activity for the six months ended June 30, 2026:
| (in thousands) | Kingsway Search Xcelerator | Extended Warranty | Total | |||||||||
| Balance, December 31, 2025 | $ | $ | $ | |||||||||
| Acquisition | ||||||||||||
| Goodwill disposed of related to Trinity | ( | ) | ( | ) | ||||||||
| Measurement period adjustments | ( | ) | ( | ) | ||||||||
| Balance, June 30, 2026 | $ | $ | $ | |||||||||
During the six months ended June 30, 2026, the Company recorded goodwill of $
As further discussed in Note 5, "Acquisitions and Disposal," during the six months ended June 30, 2026, the Company recorded measurement period adjustments, related to acquisition of Roundhouse, that decreased goodwill by $
At each of June 30, 2026 and December 31, 2025, accumulated goodwill impairment losses were $
Goodwill is assessed for impairment annually as of November 30, or more frequently if events or circumstances indicate that the carrying value may not be recoverable. In evaluating the recoverability of goodwill, the Company estimates the fair value of its reporting units and compares it to the carrying value. Although the Company believes its estimates of fair value are reasonable, actual financial results could differ from those estimates due to the inherent uncertainty involved in making such estimates. Changes in assumptions concerning future financial results or other underlying assumptions could have a significant impact on either the fair value of the reporting units, the amount of the goodwill impairment charge, or both.
NOTE 8 INTANGIBLE ASSETS
Intangible assets at June 30, 2026 and December 31, 2025 are comprised as follows:
| (in thousands) | June 30, 2026 | |||||||||||||||
| Gross Carrying Value | Accumulated Amortization | Accumulated Impairment Losses | Net Carrying Value | |||||||||||||
| Intangible assets subject to amortization: | ||||||||||||||||
| Customer relationships | $ | $ | $ | $ | ||||||||||||
| Developed technology | ||||||||||||||||
| Intangible assets not subject to amortization: | ||||||||||||||||
| Trade names | — | |||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||
| (in thousands) | December 31, 2025 | |||||||||||||||
| Gross Carrying Value | Accumulated Amortization | Accumulated Impairment Losses | Net Carrying Value | |||||||||||||
| Intangible assets subject to amortization: | ||||||||||||||||
| Customer relationships | $ | $ | $ | $ | ||||||||||||
| Developed technology | ||||||||||||||||
| Intangible assets not subject to amortization: | ||||||||||||||||
| Trade names | — | |||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||
During the six months ended June 30, 2026, the Company acquired intangible assets related to customer relationships of $
As discussed in Note 5,"Acquisitions and Disposal," the Company disposed of Trinity on May 8, 2026. Trinity had intangible assets with a gross carrying value of $
The Company's intangible assets with definite useful lives are amortized either based on the patterns in which the economic benefits of the intangible assets are expected to be consumed or using the straight-line method over their estimated useful lives, which range from
The trade names intangible assets have indefinite useful lives and are not amortized. Indefinite-lived intangible assets are assessed for impairment annually as of November 30, or more frequently if events or circumstances indicate that the carrying value may not be recoverable. The Company may perform its impairment test for any indefinite-lived intangible asset through a qualitative assessment or elect to proceed directly to a quantitative impairment test, however, the Company may resume a qualitative assessment in any subsequent period if facts and circumstances permit.
| Kingsway Corporation Notes to Consolidated Financial Statements (Unaudited) June 30, 2026 |
At each quarter end of the first and second quarters of 2026 and 2025, the Company determined that certain trade names should be further examined under a quantitative approach due to actual revenue coming in lower than previous projections. Based upon these assessments, the Company recorded impairment charges for the three and six months ended June 30, 2026 of $
NOTE 9 PROPERTY AND EQUIPMENT
| (in thousands) | June 30, 2026 | |||||||||||
| Cost | Accumulated Depreciation | Carrying Value | ||||||||||
| Leasehold improvements | $ | $ | $ | |||||||||
| Furniture and fixtures | ||||||||||||
| Computer hardware | ||||||||||||
| Medical equipment | ||||||||||||
| Vehicles | ||||||||||||
| Machinery and equipment | ||||||||||||
| Total | $ | $ | $ | |||||||||
| (in thousands) | December 31, 2025 | |||||||||||
| Cost | Accumulated Depreciation | Carrying Value | ||||||||||
| Leasehold improvements | ||||||||||||
| Furniture and fixtures | ||||||||||||
| Computer hardware | ||||||||||||
| Medical equipment | ||||||||||||
| Vehicles | ||||||||||||
| Machinery and equipment | ||||||||||||
| Total | $ | $ | $ | |||||||||
Depreciation expense was $
NOTE 10 DEBT
Debt consists of the following instruments at June 30, 2026 and December 31, 2025:
| (in thousands) | June 30, 2026 | December 31, 2025 | ||||||||||||||
| Principal | Carrying Value | Principal | Carrying Value | |||||||||||||
| Bank loans: | ||||||||||||||||
| KSX Term Loans | $ | $ | $ | $ | ||||||||||||
| KSX Revolvers | ||||||||||||||||
| Extended Warranty Term Loan and DDTL | ||||||||||||||||
| Extended Warranty Revolver | ||||||||||||||||
| Total bank loans | ||||||||||||||||
| Notes payable: | ||||||||||||||||
| KSX Notes Payable | ||||||||||||||||
| KSX Vehicle Loans | ||||||||||||||||
| KSX Equipment Loans | ||||||||||||||||
| Total notes payable | ||||||||||||||||
| Subordinated debt | ||||||||||||||||
| Total Debt | $ | $ | $ | $ | ||||||||||||
All of the KSX and Extended Warranty indebtedness arises from individual, stand-alone credit agreements with the applicable Company subsidiary. None of such indebtedness is guaranteed by the Company or any other subsidiary or affiliate of the Company other than the borrower entity and its direct subsidiary, if any, and there are no cross-collateral, cross-default or similar provisions in the credit agreements.
Term loans are carried in the consolidated balance sheets at their amortized cost, which reflects the monthly or quarterly pay-down of principal, as well as amortization of any debt discount and issuance costs using the effective interest rate method.
| Kingsway Corporation Notes to Consolidated Financial Statements (Unaudited) June 30, 2026 |
The various bank loans contain a number of covenants, including, but not limited to, a leverage ratio and a fixed charge ratio, all of which are as defined in and calculated pursuant to the respective bank loan agreements that, among other things, restrict the respective borrower’s ability to incur additional indebtedness, create liens, make dividends and distributions, engage in mergers, acquisitions and consolidations, make certain payments and investments and dispose of certain assets.
The contractual maturities of the Company's principal debt balances as of June 30, 2026 were as follows:
| (in thousands) | Principal Maturities | |||
| 2026 | $ | |||
| 2027 | ||||
| 2028 | ||||
| 2029 | ||||
| 2030 | ||||
| Thereafter | ||||
| Total | $ | |||
(a) Bank loans - KSX:
As part of the acquisition of Ravix Group, Inc. ("Ravix") on October 1, 2021, Ravix became a wholly owned subsidiary of Ravix Acquisition LLC ("Ravix LLC"), and together they borrowed from a bank a principal amount of $
The Ravix term loan has a carrying value of $
Since origination, there have been amendments to the Ravix term loan and revolver. Changes to the Ravix term loan and revolver during 2026 and 2025 are as follows:
| • | On February 7, 2025, Ravix, Ravix LLC and CSuite entered into a fourth amendment to the Ravix term loan that provides for: (1) a new 2025 term loan in the principal amount of $ | |
| • | On January 2, 2026, Ravix, Ravix LLC and CSuite entered into a sixth amendment to the Ravix term loan that provides for adding a second tranche to the Ravix term loan with a principal amount of $ |
The various amendments to the term loan and revolver were not deemed to be substantially different than prior to the amendment; therefore, the amendments were accounted for as modifications. The unamortized debt discount and issuance costs from the original Ravix term loan at the February 7, 2025 modification date of $
The Ravix term loan, as amended, is secured by certain of the equity interests and assets of Ravix and CSuite.
SNS
The SNS term loan has a carrying value of $
As part of the asset acquisition of Secure Nursing Service, Inc. on November 18, 2022, the Company formed Secure Nursing Service LLC ("SNS"), which became a wholly owned subsidiary of Pegasus Acquirer Holdings LLC ("Pegasus LLC"), and together they borrowed from a bank a principal amount of $
| Kingsway Corporation Notes to Consolidated Financial Statements (Unaudited) June 30, 2026 |
The SNS Loan is secured by certain of the equity interests and assets of SNS.
Beginning March 31, 2024 through June 30, 2026, SNS was in default under the SNS Loan due to debt covenant violations related to the leverage and fixed charge ratios (measured quarterly). In February 2026, SNS and the lender amended the credit agreement to (1) extend the SNS revolver maturity date to be June 2, 2026; and (2) suspend monthly principal payments beginning February 2026 through May 2026, with the next principal payment resuming in June 2026. In July 2026, SNS and the lender amended the credit agreement to (1) extend the SNS revolver maturity date to be December 2, 2026; and (2) suspend monthly principal payments through November 2026, with the next principal payment resuming in December 2026. The Company has entered into an amendment to the SNS Loan that waives the events of default for the fiscal quarter ended June 30, 2026. As of the report date, there is some uncertainty as to whether the Company will be in compliance with the covenants in future periods, and if not, when the Company will be able to cure any potential violations. As a result, the Company has included the total principal balance due after one-year related to the SNS Loan of $
DDI
The DDI term loan has a carrying value of $
As part of the acquisition of Digital Diagnostics Inc. ("DDI") on October 26, 2023, DDI became a wholly owned subsidiary of DDI Acquisition, LLC ("DDI LLC"), and together they borrowed from a bank a principal amount of $
The DDI Loan is secured by certain of the equity interests and assets of DDI.
Beginning September 30, 2025 through June 30, 2026, DDI was in default under the DDI Loan due to a debt covenant violation related to the fixed charge ratio (measured quarterly). The Company has entered into an amendment to the DDI Loan that waives the event of default for the fiscal quarter ended June 30, 2026. As of the report date, there is some uncertainty as to whether the Company will be in compliance with the covenants in future periods, and if not, when the Company will be able to cure any potential violations. As a result, the Company has reclassified the total principal balance of the DDI Loan due after one-year of $
Image Solutions
The Image Solutions term loan has a carrying value of $
As part of the acquisition of Image Solutions, LLC ("Image Solutions") on September 26, 2024, Image Solutions became a wholly owned subsidiary of Steel Bridge Acquisition, LLC ("SB LLC"), and together they borrowed from a bank a principal amount of $
The Image Solutions Loan is secured by certain of the equity interests and assets of Image Solutions.
Roundhouse
The Roundhouse term loan has a carrying value of $
As part of the acquisition of Roundhouse on July 1, 2025, Roundhouse became a wholly owned subsidiary of Longhorns Acquisition LLC ("Longhorns LLC"), and together they borrowed from a bank a principal amount of $
The Roundhouse Loan is secured by certain of the equity interests and assets of Roundhouse.
Kingsway Plumbing Holdco LLC ("KPH")
The KPH term loan has a carrying value of $
In 2025, the Company formed KPH, whose subsidiaries include Bud's Plumbing, Advanced Plumbing and Southside Plumbing. As part of the acquisition of Southside Plumbing on August 14, 2025, KPH and its subsidiaries borrowed from a bank a principal amount of $
| Kingsway Corporation Notes to Consolidated Financial Statements (Unaudited) June 30, 2026 |
The KPH Loan is secured by certain of the equity interests and assets of KPH.
At June 30, 2026, KPH was in default under the KPH Loan due to a debt covenant violation related to the leverage and fixed charge ratios (measured quarterly). As of the report date, the Company has not received a waiver or amendment from the lender regarding this non-compliance. As a result, the Company has reclassified the total principal balance of the KPH Loan due after one-year of $
(b) Bank loans - Extended Warranty:
Kingsway Warranty Holdings LLC ("KWH")
The KWH term loan has a carrying value of $
In 2019, the Company formed KWH, whose original subsidiaries included IWS Acquisition Corporation ("IWS"), Geminus Holdings Company, Inc. ("Geminus") and Trinity. As part of the acquisition of PWI Holdings, Inc. ("PWI") on December 1, 2020, PWI became a wholly owned subsidiary of KWH, which borrowed a principal amount of $
The KWH term loan and revolver has an annual interest rate equal to SOFR, having a floor of
Since origination, there have been amendments to the KWH term loan and revolver. Changes to the KWH term loan and revolver during 2026 and 2025 are as follows:
| • | On December 18, 2025, KWH entered into a fifth amendment to the revolver that provides for: (1) an increase to the KWH revolver commitment from $ |
The amendments were not deemed to be substantially different than prior to the amendments; therefore, the amendments were accounted for as a modification.
The term loan and revolver, as amended, are secured by certain of the equity interests and assets of KWH and its subsidiaries.
(c) Notes payable - KSX:
On July 1, 2025 Roundhouse established a $
The following seller notes were entered into during 2026 and 2025 in connection with various acquisitions which were used to partially finance the respective acquisitions:
| • | Ravix on January 2, 2026, principal amount of $ | |
| • | Advanced Plumbing on August 1, 2025, principal amount of $ | |
| • | Southside Plumbing on August 14, 2025, principal amount of $ |
(d) Subordinated debt:
On May 22, 2003, a subsidiary trust of the Company, Kingsway DE Statutory Trust III, issued $
The subordinated debt, or TruPs, is carried in the consolidated balance sheets at fair value. See Note 22, "Fair Value of Financial Instruments," for further discussion of the subordinated debt. The portion of the change in fair value of subordinated debt related to the instrument-specific credit risk is recognized in other comprehensive (loss) income.
| Kingsway Corporation Notes to Consolidated Financial Statements (Unaudited) June 30, 2026 |
The change in fair value of the Company’s subordinated debt is recorded in the consolidated financial statements for the three and six months ended June 30, 2026 and June 30, 2025 are as follows:
| (in thousands) | Three Months ended June 30, | Six months ended June 30, | ||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Increase (decrease) in fair value included in other comprehensive (loss) income (a) | $ | $ | $ | ( | ) | $ | ||||||||||
| Loss (gain) on change in fair value included in other income, net in the consolidated statement of operations | ( | ) | ||||||||||||||
| Increase (decrease) in fair value of subordinated debt | $ | $ | $ | ( | ) | $ | ||||||||||
| (a) | attributable to instrument-specific credit risk |
The agreement governing the remaining subordinated debt contains a number of covenants that, among other things, restrict the Company’s ability to incur additional indebtedness, make dividends and distributions, and make certain payments in respect of the Company’s outstanding securities.
NOTE 11 LEASES
(a) Lessee leases:
The Company has operating leases for office space that include fixed base rent payments, as well as variable rent payments to reimburse the landlord for operating expenses and taxes. The Company’s variable lease payments do not depend on a published index or rate, and therefore, are expensed as incurred. The Company includes only fixed payments for lease components in the measurement of the right-of-use asset and lease liability. There are no residual value guarantees. The Company also leases certain equipment under a finance lease.
The following table summarizes the operating and finance lease amounts included in the Company's consolidated balance sheets as of June 30, 2026 and December 31, 2025:
| (in thousands) | Classification in Balance Sheet | June 30, 2026 | December 31, 2025 | ||||||
| Assets | |||||||||
| Operating right of use assets | Other assets | $ | $ | ||||||
| Finance right of use asset | Other assets | ||||||||
| Total right of use assets | $ | $ | |||||||
| Liabilities | |||||||||
| Operating lease liabilities, current | Accrued expenses and other current liabilities | $ | $ | ||||||
| Operating lease liabilities, noncurrent | Other liabilities, noncurrent | ||||||||
| Finance lease liability, current | Accrued expenses and other current liabilities | ||||||||
| Finance lease liability, noncurrent | Other liabilities, noncurrent | ||||||||
| Total lease liabilities | $ | $ | |||||||
Operating lease costs, variable lease costs and short-term lease costs included in selling, general and administrative expenses for the three and six months ended June 30, 2026 and June 30, 2025 were as follows:
| (in thousands) | Three months ended June 30, | Six months ended June 30, | ||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Operating lease cost | $ | $ | $ | $ | ||||||||||||
| Variable lease cost | ||||||||||||||||
| Short-term lease cost | ||||||||||||||||
Finance lease costs were immaterial for the three and six months ended June 30, 2026. At December 31, 2025, the Company had no finance lease obligations.
The annual maturities of lease liabilities as of June 30, 2026 were as follows:
| (in thousands) | Lease Commitments | |||
| 2026 | $ | |||
| 2027 | ||||
| 2028 | ||||
| 2029 | ||||
| 2030 | ||||
| 2031 and thereafter | ||||
| Total undiscounted lease payments | ||||
| Imputed interest | ||||
| Total lease liabilities | $ | |||
| Kingsway Corporation Notes to Consolidated Financial Statements (Unaudited) June 30, 2026 |
The weighted-average remaining lease term for our operating leases was
The remaining lease term for our finance lease is
(b) Lessor leases:
The Company enters into contracts with third-parties to lease equipment to its customers. In certain of these contracts, the Company has the option to purchase the equipment back from such third-party at the end of the lease term with the end customer. In these cases, the Company determined that these contracts represent a lease, and the Company is a lessor under these contracts. The sum of the lease payments received by the Company exceed the cost of the equipment. Therefore, these leases are determined to be sales-type leases. The Company receives the full lease payment for the equipment upfront when the equipment is delivered to the customer and installation is complete. Therefore the Company does not record a receivable or interest income related to these leases. The Company recognizes all revenue and costs associated with the sales-type lease within revenue, and cost of services, respectively, upon delivery and installation of the equipment to the customer. For the three months ended June 30, 2026 and June 30, 2025, total revenue recognized from sales-type leases was $
NOTE 12 OTHER ASSETS AND OTHER LIABILITIES
Other current assets includes accrued investment income, inventory and the current portion of other receivables, prepaid expenses and contract asset. Current other receivables are recorded net of an allowance of $
Other assets includes other investments, lease right of use assets and the noncurrent portion of other receivables, prepaid expenses and contract asset.
Accrued expenses and other current liabilities includes the following:
| (in thousands) | June 30, 2026 | December 31, 2025 | ||||
| Accrued Expenses and Other Current Liabilities: | ||||||
| Accounts payable | $ | $ | ||||
| Refund liability | ||||||
| Current lease liability | ||||||
| Other accrued liabilities | ||||||
| Total | $ | $ | ||||
Other liabilities, noncurrent includes contingent liabilities, seller phantom equity award liabilities and the noncurrent portion of the lease liability.
NOTE 13 REVENUE FROM CONTRACTS WITH CUSTOMERS
Revenue from contracts with customers relates to the Kingsway Search Xcelerator and Extended Warranty segments and includes: business services revenue, healthcare services revenue, software license and support revenue, motor sales and repair service revenue, skilled trades repair and service revenue, vehicle service agreement fees, maintenance support service fees and warranty product commissions, based on terms of various agreements with consumers, businesses and credit unions. Customers either pay in full when business and healthcare services, software license and support, motor sales and skilled trades services are billed, or at the inception of a warranty contract or commission product sale, or on terms subject to the Company’s customary credit reviews.
The following table disaggregates revenues from contracts with customers by revenue type for the three and six months ended June 30, 2026 and June 30, 2025:
| (in thousands) | Three months ended June 30, | Six months ended June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||
| Vehicle service agreement fees | IWS, Geminus and PWI | $ | $ | $ | $ | ||||||||||||
| Maintenance support service fees | Trinity | ||||||||||||||||
| Warranty product commissions | Trinity | ||||||||||||||||
| Business services fees | Ravix, CSuite and Image Solutions | ||||||||||||||||
| Healthcare services fees | SNS and DDI | ||||||||||||||||
| Software license and support fees | SPI | ||||||||||||||||
| Motor sales and repair service fees | Roundhouse | ||||||||||||||||
| Skilled trades repair and service fees | Bud's Plumbing, Advanced Plumbing and Southside Plumbing | ||||||||||||||||
| Total revenue | $ | $ | $ | $ | |||||||||||||
| Kingsway Corporation Notes to Consolidated Financial Statements (Unaudited) June 30, 2026 |
Vehicle service agreement fees include the fees collected to cover the costs of future automobile mechanical breakdown claims and the associated administration of those claims. Vehicle service agreement fees are earned over the duration of the vehicle service agreement contracts as the single performance obligation is satisfied. Vehicle service agreement fees are initially recorded as deferred service fees with revenues recognized over the term of the contract based on the proportion of expected claims to total overall claims to be incurred over the life of the contract. The Company believes this reasonably represents the transfer of services to the vehicle service contract holder over the warranty term. The Company compares the remaining deferred service fees balance to the estimated amount of expected future claims under the vehicle service agreement contracts and records an additional accrual if the deferred service fees balance is less than expected future claims costs.
In certain jurisdictions the Company is required to refund to a customer a pro-rata share of the vehicle service agreement fees if a customer cancels the agreement prior to the end of the term. Depending on the jurisdiction, the Company may be entitled to deduct from the refund a cancellation fee and/or amounts for claims incurred prior to cancellation. While refunds vary depending on the term and type of product offered, historically refunds have averaged
Maintenance support service fees include the service fees collected to administer equipment breakdown and maintenance support services and are earned as services are rendered.
Warranty product commissions include the commissions from the sale of warranty contracts for certain new and used heating, ventilation, air conditioning ("HVAC"), standby generator, commercial LED lighting and commercial refrigeration equipment. The Company acts as an agent on behalf of the third-party insurance companies that underwrite and guaranty these warranty contracts. The Company does not guaranty the performance underlying the warranty contracts it sells. Warranty product commissions are earned at the time of the warranty product sales.
Business services revenue includes the revenue from providing outsourced finance and human resources services and information technology managed services. The Company invoices for business services revenue based on contracted rates. Revenue is earned over time as services are provided to the customer.
Healthcare services revenue includes revenue from providing healthcare professional staffing services and outsourced cardiac telemetry services for general acute care, long-term acute care and inpatient rehabilitation hospitals. The Company invoices for healthcare services revenue based on contracted rates. Revenue is earned over time as services are provided to the customer.
Software license and support revenue includes revenue from the sale or rental of software products created exclusively to serve the management needs of all types of shared-ownership properties. Software licenses are on-premise at customer locations and considered fully functional when made available and delivered to the customer. As the customer can use and benefit from the license on its own, software licenses represent distinct performance obligations. Revenue is recognized upfront at the point in time when control is transferred, which is defined as the point in time when the customer can use and benefit from the license. The Company's software licenses are sold as term licenses, and the contracts include software support services, which are accounted for as separate performance obligations. Software support revenue is recognized ratably over the contract period as services are rendered. For certain SPI contracts, the transaction price of the software license is billed in installments, typically over a three to five year period. The Company allocates a portion of the consideration received from these arrangements to a financing component when it determines that a significant financing component exists. The financing component is subsequently recognized as interest income separate from software license and support fee revenue over the term of the arrangement with the customer. Pursuant to practical expedients afforded under ASC 606, the Company does not recognize a financing component for software license sales that have a term of one year or less.
Motor sales and repair service revenue include the service fees collected from the sale of new electric motors, in-shop repair and refurbishment of customer-owned electric motors, transformers, switchgear, ancillary parts, and on-site services for customers, including preventative maintenance, infrared scans, VLF cable testing, and vibration analysis for various types of electrical equipment. Motor sales and repair service revenue is earned as motors are delivered to the customer or as repair services are provided to the customer.
Skilled trades repair and service revenue include the service fees collected to administer plumbing repairs and maintenance support services and are earned over time as services are provided to the customer.
The Company's revenue recognition policies are further described in Note 2(q), "Summary of Significant Accounting Policies - Revenue recognition," to the consolidated financial statements in the 2025 Annual Report.
Service fee receivables
Receivables from contracts with customers are reported as service fee receivable, net in the consolidated balance sheets and at June 30, 2026 and December 31, 2025 were $
Service fee receivable is reported net of an estimated allowance for credit losses at June 30, 2026 and December 31, 2025 of $
| Kingsway Corporation Notes to Consolidated Financial Statements (Unaudited) June 30, 2026 |
Contract asset
Contract asset is included in the Company's consolidated balance sheets as of June 30, 2026 and December 31, 2025 as follows:
| (in thousands) | Classification in Balance Sheet | June 30, 2026 | December 31, 2025 | ||||||
| Contract asset, current | Other current assets | $ | $ | ||||||
| Contract asset, noncurrent | Other assets | ||||||||
| Total contract asset | $ | $ | |||||||
The Company records a contract asset when revenue is recognized prior to billing the customer. Upon billing, which typically occurs over a three to five year installment period, the value of the contract asset is reversed and service fee receivable is recorded. Changes in the contract asset for the six months ended June 30, 2026 were as follows:
| (in thousands) | Six Months Ended June 30, 2026 | |||
| Balance, December 31, 2025 | $ | |||
| Contract asset additions | ||||
| Amounts transferred to service fee receivables | ( | ) | ||
| Adjustment of contract asset balances | ( | ) | ||
| Balance, June 30, 2026 | $ | |||
The contract asset is reported net of an estimated allowance for credit losses of at June 30, 2026 and December 31, 2025. Contract assets that are deemed to be uncollectible are written off against the allowance for credit losses when identified. During each of the three and six months ended June 30, 2026 and June 30, 2025, the Company recorded write-offs to the contract asset for amounts that were deemed to be uncollectible of .
Deferred service fees
The Company records deferred service fees resulting from contracts with customers when payment is received in advance of satisfying the performance obligations. Changes in deferred service fees for the six months ended June 30, 2026 were as follows:
| (in thousands) | Six Months Ended June 30, 2026 | |||
| Balance, December 31, 2025 | $ | |||
| Deferral of revenue | ||||
| Recognition of deferred service fees | ( | ) | ||
| Balance, June 30, 2026 | $ | |||
Approximately $
Remaining performance obligations
The Company expects to recognize within year as revenue approximately
Deferred contract costs
Deferred contract costs represent the deferral of incremental costs to obtain or fulfill a contract with a customer. Incremental costs to obtain a contract with a customer primarily include sales commissions. The Company capitalizes costs incurred to fulfill a contract if the costs are identifiable, generate or enhance resources used to satisfy future performance obligations and are expected to be recovered. Costs to fulfill a contract include labor costs for set-up activities directly related to the acquisition of vehicle service agreements. Contract costs are deferred and amortized over the expected customer relationship period consistent with the pattern in which the related revenues are earned. Amortization of incremental costs to obtain a contract and costs to fulfill a contract with a customer are recorded in cost of services in the unaudited consolidated statements of operations.
The deferred contract costs balances and related amortization expense for the three months ended June 30, 2026 and June 30, 2025 are comprised as follows:
| (in thousands) | Three months ended June 30, 2026 | Three months ended June 30, 2025 | ||||||||||||||||||||||
| Costs to Obtain a Contract | Costs to Fulfill a Contract | Total | Costs to Obtain a Contract | Costs to Fulfill a Contract | Total | |||||||||||||||||||
| Balance at March 31, net | $ | $ | $ | $ | $ | |||||||||||||||||||
| Additions | ||||||||||||||||||||||||
| Amortization | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
| Balance at June 30, net | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
| KINGSWAY CORPORATION June 30, 2026 |
The deferred contract costs balances and related amortization expense for the six months ended June 30, 2026 and June 30, 2025 are comprised as follows:
| (in thousands) | Six months ended June 30, 2026 | Six months ended June 30, 2025 | ||||||||||||||||||||||
| Costs to Obtain a Contract | Costs to Fulfill a Contract | Total | Costs to Obtain a Contract | Costs to Fulfill a Contract | Total | |||||||||||||||||||
| Balance at December 31, net | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
| Additions | ||||||||||||||||||||||||
| Amortization | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||
| Balance at June 30, net | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
NOTE 14 INCOME TAXES
Income tax expense (benefit) for the three and six months ended June 30, 2026 and June 30, 2025 varies from the amount that would result by applying the applicable of
| (in thousands) | Three months ended June 30, | Six months ended June 30, | ||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Income tax expense (benefit) at U. S. statutory income tax rate | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||||
| Valuation allowance | ( | ) | ( | ) | ||||||||||||
| Share-based payment awards | ||||||||||||||||
| Earnings of noncontrolling interests | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| State and local income taxes, net of federal income tax effects | ||||||||||||||||
| Disposition of subsidiary | ||||||||||||||||
| Other | ||||||||||||||||
| Income tax expense (benefit) | $ | $ | ( | ) | $ | $ | ( | ) | ||||||||
The Company maintains a valuation allowance for its gross deferred tax assets at June 30, 2026 and December 31, 2025. The Company's operations have generated substantial operating losses in prior years. These losses can be available to reduce income taxes that might otherwise be incurred on future taxable income; however, it is uncertain whether the Company will generate the taxable income necessary to utilize these losses or other reversing temporary differences. This uncertainty has caused management to place a valuation allowance on its June 30, 2026 and December 31, 2025 net deferred tax asset, excluding the deferred income tax liability amounts set forth in the paragraph below which were determined to not reverse and offset existing deferred tax assets.
The Company carries net deferred income tax liabilities of $
| • | $ | |
| • | $ | |
| • | $ |
As of June 30, 2026 and December 31, 2025, the Company had
| KINGSWAY CORPORATION June 30, 2026 |
NOTE 15 LOSS PER SHARE
The following table sets forth the reconciliation of numerators and denominators for the basic and diluted loss per share computation for the three and six months ended June 30, 2026 and June 30, 2025:
| (in thousands, except per share data) | Three months ended June 30, | Six months ended June 30, | ||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Numerator: | ||||||||||||||||
| Net income (loss) | $ | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||||
| Less: net income attributable to noncontrolling interests and redeemable noncontrolling interests | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Less: dividends on preferred stock | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Numerator used in calculating basic loss per share attributable to common shareholders | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Numerator used in calculating diluted loss per share attributable to common shareholders | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Denominator: | ||||||||||||||||
| Weighted-average basic shares | ||||||||||||||||
| Weighted-average common shares outstanding | ||||||||||||||||
| Weighted-average diluted shares | ||||||||||||||||
| Weighted-average common shares outstanding | ||||||||||||||||
| Effect of potentially dilutive securities (a) | ||||||||||||||||
| Stock options | ||||||||||||||||
| Unvested restricted stock awards | ||||||||||||||||
| Convertible preferred stock | ||||||||||||||||
| Total weighted-average diluted shares | ||||||||||||||||
| Basic loss per share attributable to common shareholders | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| Diluted loss per share attributable to common shareholders | $ | ( | ) | $ | ( | ) | $ | ( | ) | $ | ( | ) | ||||
| (a) | Potentially dilutive securities consist of stock options and unvested restricted stock awards, calculated using the treasury stock method, and convertible preferred stock, using the if-converted method. Because the Company is reporting a net loss attributable to common shareholders for the three and six months ended June 30, 2026 and June 30, 2025, all potentially dilutive securities outstanding were excluded from the calculation of diluted loss per share since their inclusion would have been anti-dilutive. |
Basic loss per share excludes dilution and is computed by dividing loss attributable to common shareholders by the weighted-average number of common shares outstanding for the period. Diluted loss per share is calculated using weighted-average diluted shares. Weighted-average diluted shares is calculated by adding the effect of potentially dilutive securities to weighted-average common shares outstanding. Potentially dilutive securities are excluded from the diluted loss per share computation in loss periods and when the applicable exercise price is greater than the market price on the period end date as their effect would be anti-dilutive.
| Three months ended June 30, | Six months ended June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Stock options | ||||||||||||||||
| Unvested restricted stock awards | ||||||||||||||||
| Convertible preferred stock | ||||||||||||||||
| Total | ||||||||||||||||
| KINGSWAY CORPORATION June 30, 2026 |
NOTE 16 STOCK-BASED COMPENSATION
The Company recognizes stock-based compensation expense for all share-based awards made to employees, including restricted stock awards, restricted common unit awards and employee stock options, based on estimated fair values. Total stock-based compensation expense related to all of the Company's restricted stock awards, restricted common unit awards and employee, director and non-employee stock options was $
(a) Restricted Stock Awards of the Company:
During 2026, the Company granted
The following table summarizes the activity related to unvested restricted stock awards during the six months ended June 30, 2026:
| Number of | Weighted-Average | |||||||
| Restricted | Grant Date Fair | |||||||
| Stock Awards | Value (per Share) | |||||||
| Unvested at December 31, 2025 | $ | |||||||
| Granted | ||||||||
| Unvested at June 30, 2026 | $ | |||||||
(b) Restricted Common Units Awards of KPH:
In March of 2025, KPH, a subsidiary of the Company, granted
(c) Stock Options:
Under the 2020 Equity Incentive Plan, as amended, the Company granted
The following table summarizes all stock option activity during the six months ended June 30, 2026:
| (in thousands, except per share data) | ||||||||||||||||
| Weighted-Average | ||||||||||||||||
| Number of | Remaining | |||||||||||||||
| Options | Weighted-Average | Contractual | Aggregate | |||||||||||||
| Outstanding | Exercise Price | Term (in Years) | Intrinsic Value | |||||||||||||
| Outstanding at December 31, 2025 | $ | 8.4 | $ | |||||||||||||
| Granted | ||||||||||||||||
| Outstanding at June 30, 2026 | $ | $ | ||||||||||||||
| Exercisable at June 30, 2026 | $ | 9.3 | $ | |||||||||||||
The aggregate intrinsic value of stock options outstanding and exercisable is the difference between the June 30, 2026 market price for the Company's common shares and the exercise price of the options, multiplied by the number of options where the June 30, 2026 market price exceeds the exercise price.
| KINGSWAY CORPORATION June 30, 2026 |
The Company uses the Black-Scholes option pricing model to estimate the fair value of each option on the date of grant. The fair value of grants and the related assumptions used in the Black-Scholes pricing model for options granted during the six months ended June 30, 2026 were as follows:
| Six Months Ended June 30, | ||||
| 2026 | ||||
| Weighted-average fair value of grants | $ | |||
| Risk-free interest rate | % | |||
| Dividend yield | ||||
| Expected volatility | % | |||
| Expected term (in years) | ||||
The risk-free rate was determined based on U.S. treasury yields that most closely approximated the options' expected term. The dividend yield was determined based on the Company's dividend paying history. The expected volatility was calculated based on the weekly closing price of the Company's common stock over the expected life of the options. The expected term was determined by estimating a cost of equity for the Company to determine time to when the option would be at-the-money, and then adding that amount to the average time to vest.
NOTE 17 REDEEMABLE PREFERRED STOCK
At June 30, 2026, the Company had three series of redeemable preferred stock ("Preferred Stock") outstanding. In accordance with FASB ASC Topic 480-10-S99-3A, SEC Staff Announcement: Classification and Measurement of Redeemable Securities, redemption features not solely within the control of the issuer are required to be presented outside of permanent equity on the consolidated balance sheets. For each series of the Preferred Stock outstanding, the holder has the option to convert each share of Preferred Stock into
The following table summarizes the Company's redeemable preferred stock outstanding at June 30, 2026 and December 31, 2025:
| Description | Issue Date | Shares Authorized | Shares Outstanding | Par Value | Redemption Value per Share | Aggregate Redemption Value (in thousands) | Dividend Rate | Redemption Date | Maximum Number of Common Shares Issuable on Conversion | Carrying Amount (in thousands) | ||||||||||||||||||||||||
| Class B Preferred | September 24, 2024 | $ | $ | $ | % | September 24, 2031 | $ | |||||||||||||||||||||||||||
| Class C Preferred | February 1, 2025 | $ | $ | $ | % | February 12, 2032 | $ | |||||||||||||||||||||||||||
| Class D Preferred | May 8, 2025 | $ | $ | $ | % | May 7, 2032 | $ | |||||||||||||||||||||||||||
The Class B Preferred Stock ranks senior to the Company's common shares. The Class C and Class D Preferred Stock ranks pari passu with the Company’s Class B Preferred Stock and senior to the Company's common shares.
The holders of each series of Preferred Stock will not be entitled to receive notice of or to attend any meeting of the shareholders of the Company and will not be entitled to vote at any such meeting. The holders of each series of Preferred Stock are entitled to receive fixed, cumulative, preferential cash dividends at a rate of
The Company shall have the option to redeem
| Kingsway Corporation Notes to Consolidated Financial Statements (Unaudited) June 30, 2026 |
Declared dividends to be paid to the holders of the Company's Preferred Stock for the three and six months ended June 30, 2026 and June 30, 2025 are as follows:
| (in thousands) | Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Class B Preferred | $ | 165 | $ | 165 | $ | 328 | $ | 328 | ||||||||
| Class C Preferred | ||||||||||||||||
| Class D Preferred | ||||||||||||||||
| Total | $ | $ | $ | $ | ||||||||||||
Accrued dividend included in accrued expenses and other current liabilities in the consolidated balance sheets, are $
Cash dividends paid during the three months ended June 30, 2026 and June 30, 2025 were $
Note 18 Redeemable Noncontrolling Interest
Redeemable noncontrolling interest represents a
Changes in the Company's redeemable noncontrolling interest for the six months ended June 30, 2026 were as follows:
| (in thousands) | Six Months Ended June 30, 2026 | |||
| Balance, December 31, 2025 | $ | |||
| Net loss attributable to redeemable noncontrolling interest | ( | ) | ||
| Balance, June 30, 2026 | $ | |||
NOTE 19 Shareholders' Equity
(a) Common Stock Sale:
On June 24, 2025, the Company entered into a Stock Purchase Agreement (the “Purchase Agreement”) with certain third-parties. Pursuant to the Purchase Agreement, the Company sold an aggregate of
(b) Security Repurchases:
On March 21, 2023, the Company's Board of Directors approved a security repurchase program under which the Company was authorized to repurchase up to $
| KINGSWAY CORPORATION June 30, 2026 |
NOTE 20 ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
The tables below detail the change in the balance of each component of accumulated other comprehensive income (loss), net of tax, for the three and six months ended June 30, 2026 and June 30, 2025, as relates to shareholders' equity attributable to common shareholders on the consolidated balance sheets.
| (in thousands) | Three months ended June 30, 2026 | |||||||||||||||
| Unrealized Losses on Available-for-Sale Investments | Foreign Currency Translation Adjustments | Change in Fair Value of Debt Attributable to Instrument-Specific Credit Risk | Total Accumulated Other Comprehensive Income | |||||||||||||
| Balance at March 31, 2026 | $ | ( | ) | $ | ( | ) | $ | $ | ||||||||
| Other comprehensive loss arising during the period | ( | ) | ( | ) | ( | ) | ||||||||||
| Amounts reclassified from accumulated other comprehensive income (loss) | ||||||||||||||||
| Net current-period other comprehensive loss | ( | ) | ( | ) | ( | ) | ||||||||||
| Balance at June 30, 2026 | $ | ( | ) | $ | ( | ) | $ | $ | ||||||||
| (in thousands) | Three months ended June 30, 2025 | |||||||||||||||
| Unrealized Gains (Losses) on Available-for-Sale Investments | Foreign Currency Translation Adjustments | Change in Fair Value of Debt Attributable to Instrument-Specific Credit Risk | Total Accumulated Other Comprehensive Loss | |||||||||||||
| Balance at March 31, 2025 | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | ||||||
| Other comprehensive income (loss) arising during the period | ( | ) | ( | ) | ||||||||||||
| Amounts reclassified from accumulated other comprehensive loss (a) | ( | ) | ( | ) | ||||||||||||
| Net current-period other comprehensive income (loss) | ( | ) | ( | ) | ||||||||||||
| Balance at June 30, 2025 | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | ||||||
| (in thousands) | Six months ended June 30, 2026 | |||||||||||||||
| Unrealized Losses on Available-for-Sale Investments | Foreign Currency Translation Adjustments | Change in Fair Value of Debt Attributable to Instrument-Specific Credit Risk | Total Accumulated Other Comprehensive (Loss) Income | |||||||||||||
| Balance at January 1, 2026 | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | ||||||
| Other comprehensive (loss) income arising during the period | ( | ) | ||||||||||||||
| Amounts reclassified from accumulated other comprehensive income (loss) | ||||||||||||||||
| Net current-period other comprehensive (loss) income | ( | ) | ||||||||||||||
| Balance at June 30, 2026 | $ | ( | ) | $ | ( | ) | $ | $ | ||||||||
| (in thousands) | Six months ended June 30, 2025 | |||||||||||||||
| Unrealized Gains (Losses) on Available-for-Sale Investments | Foreign Currency Translation Adjustments | Change in Fair Value of Debt Attributable to Instrument-Specific Credit Risk | Total Accumulated Other Comprehensive Loss | |||||||||||||
| Balance at January 1, 2025 | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | ||||||
| Other comprehensive income (loss) arising during the period | ( | ) | ||||||||||||||
| Amounts reclassified from accumulated other comprehensive loss (a) | ( | ) | ( | ) | ||||||||||||
| Net current-period other comprehensive income (loss) | ( | ) | ||||||||||||||
| Balance at June 30, 2025 | $ | ( | ) | $ | ( | ) | $ | $ | ( | ) | ||||||
|
(a)
| For the three and six months ended June 30, 2025, unrealized losses on available for sale investments previously included in accumulated other comprehensive loss were reclassified to the interest and investment income, net in the unaudited consolidated statements of operations. |
| KINGSWAY CORPORATION June 30, 2026 |
NOTE 21 SEGMENTED INFORMATION
The Company reports segment information based on the "management" approach. The management approach designates the internal reporting used by management for making decisions and assessing performance as a source of the Company’s reportable operating segments. The Company's chief operating decision maker is its President and Chief Executive Officer. The Company conducts its business through the following reportable segments: Kingsway Search Xcelerator and Extended Warranty.
Kingsway Search Xcelerator Segment
Kingsway Search Xcelerator includes the Company's subsidiaries CSuite, Ravix, SNS, SPI, DDI, Image Solutions, Roundhouse, Bud's Plumbing, Advanced Plumbing and Southside Plumbing (collectively, "KSX").
CSuite is a professional services firm that provides experienced chief financial officer and other finance professionals to its clients through a variety of flexible offerings. These offerings include project, fractional and interim staffing of senior finance professionals, CFO mentoring, board advisory services, and executive search services for permanent placements for its clients throughout the United States.
Ravix provides outsourced financial services and human resources consulting to its clients on a fractional basis for both projects with definitive endpoints and ongoing engagements of indeterminate length for short or long duration engagements for customers throughout the United States.
SNS provides healthcare staffing services to acute healthcare facilities on a contract or per diem basis in the United States, primarily in California.
SPI provides software products created exclusively to serve the management needs of all types of shared-ownership properties globally.
DDI provides outsourced 24 hours a day and 7 days per week ("24/7") cardiac telemetry services for general acute care, long-term acute care and inpatient rehabilitation hospitals. Outsourcing cardiac monitoring allows hospitals to eliminate personnel callouts and human resources issues, remove distractions from onsite operations, and free up facility staff to assist directly with patient care. DDI currently has a presence in
Image Solutions provides comprehensive information technology managed services, including equipment sales, service, and helpdesk support to customers primarily in North Carolina, Kansas, Georgia, Kentucky and Tennessee.
Roundhouse provides industrial-scale electric motor solutions, including field maintenance, in-shop repair, testing, and new motor sales primarily to midstream natural gas pipeline operators and utilities across the Permian Basin.
Kingsway Skilled Trades ("KST") includes Bud's Plumbing, Advanced Plumbing and Southside Plumbing. KST provides a comprehensive range of plumbing services, including emergency repairs, drain cleaning, water heater installations, and water treatment solutions to residential and commercial customers, primarily in Evansville, Indiana (Bud's Plumbing), Cleveland, Ohio (Advanced Plumbing) and Omaha, Nebraska (Southside Plumbing).
Extended Warranty Segment
Extended Warranty includes the following subsidiaries of the Company: IWS, Geminus, PWI and Trinity (collectively, "Extended Warranty"). As discussed in Note 5, "Acquisitions and Disposal," the Company sold Trinity on May 8, 2026. The earnings of Trinity are included in the unaudited interim consolidated statements of operations and the segment disclosures through the date of sale.
IWS is a licensed motor vehicle service agreement company and is a provider of after-market vehicle protection services distributed by credit unions in
Geminus primarily sells vehicle service agreements to used car buyers across the United States, through its subsidiary, The Penn Warranty Corporation ("Penn"). Penn distributes these products in
PWI markets, sells and administers vehicle service agreements to used car buyers in
Trinity sold HVAC, standby generator, commercial LED lighting and commercial refrigeration warranty products and provided equipment breakdown and maintenance support services to companies across the United States. As a seller of warranty products, Trinity markets and administers product warranty contracts for certain new and used products in the HVAC, standby generator, commercial LED lighting and commercial refrigeration industries throughout the United States. Trinity acts as an agent on behalf of the third-party insurance companies that underwrite and guaranty these warranty contracts. Trinity does not guaranty the performance underlying the warranty contracts it sells. As a provider of equipment breakdown and maintenance support services, Trinity acts as a single point of contact to its clients for both certain equipment breakdowns and scheduled maintenance of equipment. Trinity will provide such repair and breakdown services by contracting with certain HVAC providers.
| KINGSWAY CORPORATION June 30, 2026 |
Revenues and Operating Income by Reportable Segment
Revenues by reportable segment reconciled to consolidated revenues for the three and six months ended June 30, 2026 and June 30, 2025 were:
| (in thousands) | Three months ended June 30, | Six months ended June 30, | ||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Revenues: | ||||||||||||||||
| KSX | $ | $ | $ | $ | ||||||||||||
| Extended Warranty (includes Trinity through May 8, 2026) | ||||||||||||||||
| Total revenues | $ | $ | $ | $ | ||||||||||||
Results for the Company's reportable segments are based on the Company's internal financial reporting systems and are consistent with those followed in the preparation of the unaudited consolidated interim financial statements. The Company uses operating income as the measure of profit or loss for our segments. The Company's chief operating decision maker uses segment operating income to allocate resources in the annual budget and forecasting process and considers actual versus plan variances in assessing the performance of each segment. The chief operating decision maker also uses segment operating income as an input to the overall compensation measures for segment management under the Company's incentive compensation plans. From time to time we may report the impact of certain events, gains, losses or other charges related to our segments outside of segment operating income. Segment assets are not regularly reviewed by the Company's chief operating decision maker and, therefore, are not included in the segment disclosures below.
Among other items, the current U.S. conflict with Iran, the degree and pace of inflation and interest rate changes may have impacts on our business and tariffs - or retaliatory responses to such tariffs - may impact the Company’s operating income. The potential impact of current macroeconomic uncertainties on the Company’s financial condition, results of operations, and cash flows is subject to change and continues to depend on the extent and duration of these uncertainties.
The operating income by reportable segment in the following table is before income taxes and includes revenues and direct segment costs. The significant expense categories and amounts by segment align with the segment level information that is regularly provided to the chief operating decision maker.
Total segment operating income reconciled to the consolidated net income (loss) for the three months ended June 30, 2026 and June 30, 2025 is as follows:
| Three months ended June 30, 2026 | Three months ended June 30, 2025 | |||||||||||||||||||||||
| (in thousands) | KSX | Extended Warranty | Total | KSX | Extended Warranty | Total | ||||||||||||||||||
| Revenue | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
| Less segment expenses: | ||||||||||||||||||||||||
| Cost of services - salaries and benefits | ||||||||||||||||||||||||
| Cost of sales - claims | ||||||||||||||||||||||||
| Cost of services - commissions | ||||||||||||||||||||||||
| Cost of services - other | ||||||||||||||||||||||||
| Salaries and benefits | ||||||||||||||||||||||||
| Insurance expense | ||||||||||||||||||||||||
| Professional fees | ||||||||||||||||||||||||
| IT expense | ||||||||||||||||||||||||
| Depreciation expense | ||||||||||||||||||||||||
| Other segment items (a) | ||||||||||||||||||||||||
| Total segment operating income | $ | $ | $ | $ | $ | ( | ) | $ | ||||||||||||||||
| Interest and investment income, net | ||||||||||||||||||||||||
| Selling, general and administrative expenses and other income not allocated to segments, net (b) | ( | ) | ( | ) | ||||||||||||||||||||
| Interest expense | ( | ) | ( | ) | ||||||||||||||||||||
| Amortization and impairment of intangible assets | ( | ) | ( | ) | ||||||||||||||||||||
| Gain on disposal of subsidiary | ||||||||||||||||||||||||
| Income (loss) before income tax expense (benefit) | ( | ) | ||||||||||||||||||||||
| Income tax expense (benefit) | ( | ) | ||||||||||||||||||||||
| Net income (loss) | $ | $ | ( | ) | ||||||||||||||||||||
| KINGSWAY CORPORATION June 30, 2026 |
Total segment operating income reconciled to the consolidated net loss for the six months ended June 30, 2026 and June 30, 2025 is as follows:
| Six Months Ended June 30, 2026 | Six Months Ended June 30, 2025 | |||||||||||||||||||||||
| (in thousands) | KSX | Extended Warranty | Total | KSX | Extended Warranty | Total | ||||||||||||||||||
| Revenue | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
| Less segment expenses: | ||||||||||||||||||||||||
| Cost of services - salaries and benefits | ||||||||||||||||||||||||
| Cost of sales - claims | ||||||||||||||||||||||||
| Cost of services - commissions | ( | ) | ||||||||||||||||||||||
| Cost of services - other | ||||||||||||||||||||||||
| Salaries and benefits | ||||||||||||||||||||||||
| Insurance expense | ||||||||||||||||||||||||
| Professional fees | ||||||||||||||||||||||||
| IT expense | ||||||||||||||||||||||||
| Depreciation expense | ||||||||||||||||||||||||
| Other segment items (a) | ||||||||||||||||||||||||
| Total segment operating income | $ | $ | $ | $ | $ | $ | ||||||||||||||||||
| Interest and investment income, net | ||||||||||||||||||||||||
| Selling, general and administrative expenses and other income not allocated to segments, net (b) | ( | ) | ( | ) | ||||||||||||||||||||
| Interest expense | ( | ) | ( | ) | ||||||||||||||||||||
| Amortization and impairment of intangible assets | ( | ) | ( | ) | ||||||||||||||||||||
| Gain on disposal of subsidiary | ||||||||||||||||||||||||
| Loss before income tax expense (benefit) | ( | ) | ( | ) | ||||||||||||||||||||
| Income tax expense (benefit) | ( | ) | ||||||||||||||||||||||
| Net loss | $ | ( | ) | $ | ( | ) | ||||||||||||||||||
| (a) | Other segment items in the table above for each reportable segment include bank charges, bad debt expense, occupancy expenses, licenses and taxes, general overhead expenses and miscellaneous income. |
| (b) | Selling, general and administrative expenses and other income not allocated to segments, net includes corporate and non-operating general and administrative expenses, (loss) gain on change in fair value of debt, loss on extinguishment of debt (2025 year-to-date only) and non-operating other income. |
NOTE 22 FAIR VALUE OF FINANCIAL INSTRUMENTS
Fair value is the price that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value is best evidenced by quoted bid or ask price, as appropriate, in an active market. Where bid or ask prices are not available, such as in an illiquid or inactive market, the closing price of the most recent transaction of that instrument subject to appropriate adjustments as required is used. Where quoted market prices are not available, the quoted prices of similar financial instruments or valuation models with observable market-based inputs are used to estimate the fair value. These valuation models may use multiple observable market inputs, including observable interest rates, foreign-exchange rates, index levels, credit spreads, equity prices, counterparty credit quality, corresponding market volatility levels and option volatilities. Minimal management judgment is required for fair values calculated using quoted market prices or observable market inputs for models. Greater subjectivity is required when making valuation adjustments for financial instruments in inactive markets or when using models where observable parameters do not exist. Also, the calculation of estimated fair value is based on market conditions at a specific point in time and may not be reflective of future fair values. For the Company's financial instruments carried at cost or amortized cost, the book value is not adjusted to reflect increases or decreases in fair value due to market fluctuations, including those due to interest rate changes, as it is the Company's intention to hold them until there is a recovery of fair value, which may be to maturity.
The Company employs a fair value hierarchy to categorize the inputs it uses in valuation techniques to measure the fair value. The following fair value hierarchy is used in selecting inputs, with the highest priority given to Level 1:
| • | Level 1 – Quoted prices for identical instruments in active markets. |
| • | Level 2 – Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs are observable in active markets. |
| • | Level 3 – Valuations derived from valuation techniques in which one or more significant inputs are not observable. |
The Company classifies its investments in fixed maturities as available-for-sale and reports these investments at fair value. The Company's limited liability investment, at fair value, subordinated debt, contingent consideration and seller phantom equity awards are measured and reported at fair value.
Fixed maturities - Fair values of fixed maturities for which no active market exists are derived from quoted market prices of similar instruments or other third-party evidence. All classes of the Company’s fixed maturities, primarily consisting of investments in US. Treasury bills and government bonds; obligations of states, municipalities and political subdivisions; mortgage-backed securities; and corporate securities, are classified as Level 2. Level 2 is applied to valuations based upon quoted prices for similar assets in active markets; quoted prices for identical or similar assets in markets that are inactive; or valuations based on models where the significant inputs are observable or can be corroborated by observable market data.
| KINGSWAY CORPORATION June 30, 2026 |
The Company engages a third-party vendor who utilizes third-party pricing sources and primarily employs a market approach to determine the fair values of our fixed maturities. The market approach includes primarily obtaining prices from independent third-party pricing services as well as, to a lesser extent, quotes from broker-dealers. Our third-party vendor also monitors market indicators, as well as industry and economic events, to ensure pricing is appropriate. All classes of our fixed maturities are valued using this technique. The Company has obtained an understanding of our third-party vendor’s valuation methodologies and inputs. Fair values obtained from our third-party vendor are not adjusted by the Company.
The following is a description of the significant inputs, by asset class, used by the third-party pricing services to determine the fair values of our fixed maturities included in Level 2:
| • | U.S. government, government agencies and authorities are generally priced using the market approach. Inputs generally consist of trades of identical or similar securities, quoted prices in inactive markets and maturity. |
| • | States, municipalities and political subdivisions are generally priced using the market approach. Inputs generally consist of trades of identical or similar securities, quoted prices in inactive markets, new issuances and credit spreads. |
| • | Mortgage-backed and asset-backed securities are generally priced using the market approach. Inputs generally consist of trades of identical or similar securities, quoted prices in inactive markets, expected prepayments, expected credit default rates, delinquencies and issue specific information including, but not limited to, collateral type, seniority and vintage. |
| • | Corporate securities are generally priced using the market approach using pricing vendors. Inputs generally consist of trades of identical or similar securities, quoted prices in inactive markets, issuer rating, benchmark yields, maturity and credit spreads. |
Limited liability investment, at fair value - Limited liability investment, at fair value, include the underlying investments of Argo Holdings. Argo Holdings makes investments in limited liability companies and limited partnerships that hold investments in private operating companies.
The fair value of Argo Holdings' limited liability investments that hold investments in private operating companies is valued using a market approach including valuation multiples applied to corresponding performance metrics, such as earnings before interest, tax, depreciation and amortization; revenue; or net earnings. The selected valuation multiples were estimated using multiples provided by the investees and review of those multiples in light of investor updates, performance reports, financial statements and other relevant information. These investments are categorized in Level 3 of the fair value hierarchy.
Subordinated debt - The fair value of the subordinated debt is calculated using a model based on significant market observable inputs and inputs developed by a third-party. These inputs include credit spread assumptions developed by a third-party and market observable swap rates. The subordinated debt is categorized in Level 2 of the fair value hierarchy.
Contingent consideration - The consideration for the Company's acquisitions of Advanced Plumbing and Southside Plumbing includes future payments to the former owners that are contingent upon the achievement of certain targets over future reporting periods. Liabilities for contingent consideration are measured and reported at fair value and are included in other liabilities, noncurrent in the consolidated balance sheets. Contingent consideration liabilities are revalued each reporting period. Changes in the fair value of contingent consideration liabilities can result from changes to one or multiple inputs, including adjustments to the discount rates or changes in the assumed achievement or timing of any targets. Any changes in fair value are reported in the consolidated statements of operations. The contingent consideration liabilities are categorized in Level 3 of the fair value hierarchy.
| •
| The fair value of Advanced Plumbing's contingent consideration liability is estimated by applying the Monte Carlo simulation method to forecast achievement of adjusted EBITDA, which may result in up to $ |
| • | The fair value of Southside's contingent consideration liability is estimated by applying the Monte Carlo simulation method to forecast achievement of adjusted EBITDA, which may result in up to $ |
Seller phantom equity awards - In connection with the acquisition of Roundhouse, the Company granted phantom equity awards to the former owners. The seller phantom equity awards are measured and reported at fair value and are included in other liabilities, noncurrent in the consolidated balance sheets. The seller phantom equity awards liability is measured and reported at fair value at the date of grant and is revalued each reporting period. Changes in the fair value of the seller phantom equity awards can result from changes to one or multiple inputs, including adjustments to the discount rates or changes in Roundhouse performance. Any changes in fair value are reported in the consolidated statements of operations. The seller phantom equity awards liability is categorized in Level 3 of the fair value hierarchy.
| KINGSWAY CORPORATION June 30, 2026 |
Assets and Liabilities Measured at Fair Value on a Recurring Basis
The balances of the Company's financial assets and liabilities measured at fair value on a recurring basis by level within the fair value hierarchy as of June 30, 2026 and December 31, 2025 are as follows.
| (in thousands) | June 30, 2026 | |||||||||||||||
| Fair Value Measurements at the End of the Reporting Period Using | ||||||||||||||||
| Quoted Prices in | Significant | Significant | ||||||||||||||
| Active Markets for | Other Observable | Unobservable | ||||||||||||||
| Identical Assets | Inputs | Inputs | ||||||||||||||
| Total | (Level 1) | (Level 2) | (Level 3) | |||||||||||||
| Recurring fair value measurements: | ||||||||||||||||
| Assets: | ||||||||||||||||
| Fixed maturities: | ||||||||||||||||
| U.S. government, government agencies and authorities | $ | $ | $ | $ | ||||||||||||
| States, municipalities and political subdivisions | ||||||||||||||||
| Mortgage-backed | ||||||||||||||||
| Asset-backed | ||||||||||||||||
| Corporate | ||||||||||||||||
| Total fixed maturities | ||||||||||||||||
| Limited liability investment, at fair value | ||||||||||||||||
| Total assets | $ | $ | $ | $ | ||||||||||||
| Liabilities: | ||||||||||||||||
| Subordinated debt | $ | $ | $ | $ | ||||||||||||
| Contingent consideration | ||||||||||||||||
| Seller phantom equity awards | ||||||||||||||||
| Total liabilities | $ | $ | $ | $ | ||||||||||||
| (in thousands) | December 31, 2025 | |||||||||||||||
| Fair Value Measurements at the End of the Reporting Period Using | ||||||||||||||||
| Quoted Prices in | Significant | Significant | ||||||||||||||
| Active Markets for | Other Observable | Unobservable | ||||||||||||||
| Identical Assets | Inputs | Inputs | ||||||||||||||
| Total | (Level 1) | (Level 2) | (Level 3) | |||||||||||||
| Recurring fair value measurements: | ||||||||||||||||
| Assets: | ||||||||||||||||
| Fixed maturities: | ||||||||||||||||
| U.S. government, government agencies and authorities | $ | $ | $ | $ | ||||||||||||
| States municipalities and political subdivisions | ||||||||||||||||
| Mortgage-backed | ||||||||||||||||
| Asset-backed | ||||||||||||||||
| Corporate | ||||||||||||||||
| Total fixed maturities | ||||||||||||||||
| Limited liability investment, at fair value | ||||||||||||||||
| Total assets | $ | $ | $ | $ | ||||||||||||
| Liabilities: | ||||||||||||||||
| Subordinated debt | $ | $ | $ | $ | ||||||||||||
| Contingent consideration | ||||||||||||||||
| Seller phantom equity awards | ||||||||||||||||
| Total liabilities | $ | $ | $ | $ | ||||||||||||
| KINGSWAY CORPORATION June 30, 2026 |
The following table provides a reconciliation of the fair value of recurring Level 3 fair value measurements for the three and six months ended June 30, 2026 and June 30, 2025:
| (in thousands) | Three months ended June 30, | Six months ended June 30, | ||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Assets: | ||||||||||||||||
| Limited liability investment, at fair value: | ||||||||||||||||
| Beginning balance | $ | $ | $ | $ | ||||||||||||
| Distributions received | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||
| Realized gains included in net income (loss) | ||||||||||||||||
| Change in fair value of limited liability investment, at fair value included in net income (loss) | ||||||||||||||||
| Ending balance | $ | $ | $ | $ | ||||||||||||
| Unrealized gains on limited liability investments, at fair value held at end of period: | ||||||||||||||||
| Included in net income (loss) | $ | $ | $ | $ | ||||||||||||
| Included in other comprehensive (loss) income | $ | $ | $ | $ | ||||||||||||
| Ending balance - assets | $ | $ | $ | $ | ||||||||||||
| Liabilities: | ||||||||||||||||
| Contingent consideration: | ||||||||||||||||
| Beginning balance | $ | $ | $ | $ | ||||||||||||
| Settlements of contingent consideration liabilities | ( | ) | ||||||||||||||
| Change in fair value of contingent consideration included in net income (loss) | ||||||||||||||||
| Ending balance | $ | $ | $ | $ | ||||||||||||
| Seller phantom equity awards: | ||||||||||||||||
| Beginning balance | $ | $ | $ | $ | ||||||||||||
| Change in fair value of seller phantom equity award liability included in net income (loss) | ||||||||||||||||
| Ending balance | $ | $ | $ | $ | ||||||||||||
| Ending balance - liabilities | $ | $ | $ | $ | ||||||||||||
The following table summarizes the valuation techniques and significant unobservable inputs utilized in determining fair values for the Company's financial assets and liabilities that are categorized as Level 3 at June 30, 2026:
| Fair Value | ||||||||||
| Categories | (in thousands) | Valuation Techniques | Unobservable Inputs | Input Value(s) | ||||||
| Limited liability investment, at fair value | $ | Market approach | Valuation multiples | 1.0x - 9.0x | ||||||
| Contingent consideration | $ | Option-based income approach | Discount rate | |||||||
| Risk-free rate | ||||||||||
| Expected volatility | % | |||||||||
| Seller phantom equity awards | $ | Market approach | Internal rate of return | % | ||||||
The following table summarizes the valuation techniques and significant unobservable inputs utilized in determining fair values for the Company's financial assets and liabilities that are categorized as Level 3 at December 31, 2025:
| Fair Value | ||||||||||
| Categories | (in thousands) | Valuation Techniques | Unobservable Inputs | Input Value(s) | ||||||
| Limited liability investment, at fair value | $ | Market approach | Valuation multiples | 1.0x - 9.0x | ||||||
| Contingent consideration | $ | Option-based income approach | Discount rate | |||||||
| Risk-free rate | ||||||||||
| Expected volatility | % | |||||||||
| Seller phantom equity awards | $ | Market approach | Internal rate of return | % | ||||||
| KINGSWAY CORPORATION June 30, 2026 |
Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis
Certain assets and liabilities are measured at fair value on a nonrecurring basis, including assets that are adjusted for observable price changes or written down to fair value as a result of an impairment.
Indefinite-lived intangible assets are recorded at carrying value, and, if impaired, are adjusted to fair value using Level 3 inputs. Refer to Note 8, "Intangible Assets" for further information regarding the process of determining the fair value of indefinite-lived intangible assets and the impairment charges recorded for the three and six months ended June 30, 2026 and June 30, 2025.
As further discussed in Note 5, "Acquisitions and Disposal," the Company sold Trinity on May 8, 2026 and a portion of the sales proceeds were in the form of seller notes payable to the Company. The seller notes are non-interest bearing and are due May 8, 2036; however they could be paid off early at any time prior to May 8, 2036, for a discount, if certain conditions are met. The fair value of the seller notes associated with the sale of Trinity were determined to be Level 3 under the fair value hierarchy. Repayment, default and change in control scenarios, probability weighting of those scenarios and discount rates ranging from
Assets and Liabilities Not Carried at Fair Value
The carrying amounts reported in the consolidated balance sheets approximate fair values for cash and cash equivalents, restricted cash, short-term investments and certain other assets and other liabilities because of their short-term nature. The fair values of the Company's bank loans, which are reported as debt in the consolidated balance sheets, are derived from quoted market prices of industrial bonds with similar maturities and are categorized within Level 2 of the fair value hierarchy. The estimated fair value of bank loans was $
NOTE 23 RELATED PARTIES
Related party transactions, including services provided to or received by the Company's subsidiaries, are measured in part by the amount of consideration paid or received as established and agreed by the parties. Except where disclosed elsewhere in these unaudited consolidated interim financial statements, the following is a summary of related party relationships and transactions.
Argo Management Group, LLC
The Company acquired Argo Management Group, LLC ("Argo Management") in April 2016. Argo Management's primary business is to act as Managing Member of Argo Holdings. At June 30, 2026 and December 31, 2025, each of the Company, John T. Fitzgerald ("Fitzgerald"), the Company's Chief Executive Officer and President, and certain of Fitzgerald’s immediate family members owns equity interests in Argo Holdings, all of which interests were acquired prior to the Company’s acquisition of Argo Management. Subject to certain limitations, Argo Holdings' governing documents require all individuals and entities owning an equity interest in Argo Holdings to fund upon request his/her/its pro rata share of any funding requirements of Argo Holdings up to an aggregate maximum amount equal to his/her/its total capital commitment (each request for funds being referred to as a "Capital Call"). Argo Holdings made no Capital Calls during the six months ended June 30, 2026 and the year ended December 31, 2025.
Preferred Stock Private Placements
As further described in Note 17, " Redeemable Preferred Stock,":
| • | On September 24, 2024, the Company closed on a private placement for aggregate proceeds totaling $ |
| • | In February 2025, the Company closed on a private placement for aggregate proceeds totaling $ |
| • | On May 8, 2025, the Company closed on a private placement for aggregate proceeds totaling $ |
Common Stock Private Placement
On June 24, 2025, the Company entered into a Purchase Agreement with certain third-parties for aggregate gross proceeds of $
Director Retainer Agreement
On May 18, 2026, the Company entered into a Director Retainer Agreement with Mr. Adam Patinkin, our Chairman, which provides for, among other items, (i) the grant of certain 2026 Stock Options and (ii) the payment of cash fees for each year of service equal to $
| Kingsway Corporation Notes to Consolidated Financial Statements (Unaudited) June 30, 2026 |
NOTE 24 COMMITMENTS AND CONTINGENCIES
Collateral pledged and restricted cash:
The Company has restricted cash of $
| • | $ |
| • | $ |
| • | less than $ |
Kingsway Corporation
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
FORWARD-LOOKING STATEMENTS
Management's Discussion and Analysis 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 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, see Kingsway’s securities filings, including its Annual Report on Form 10-K for the year ended December 31, 2025 ("2025 Annual Report"). The Company's securities filings can be accessed on the EDGAR section of the U.S. Securities and Exchange Commission’s website at www.sec.gov, on the Canadian Securities Administrators’ website at www.sedar.com or through the Company’s website at www.kingsway-financial.com. Except as expressly required by applicable securities law, the Company disclaims any intention or obligation to update or revise any forward-looking statements because of new information, future events or otherwise.
OVERVIEW
Kingsway is a Delaware holding company with operating subsidiaries located in the United States. The Company is the only publicly-traded US company employing the Search Fund model to acquire and build great businesses and owns and operates a collection of high-quality B2B and B2C services companies that are asset-light, growing, profitable, and that have recurring revenues. Kingsway seeks to compound long-term shareholder value on a per share basis via its decentralized management model, its talented team of operators, and its tax-advantaged corporate structure. Kingsway conducts its business through two reportable segments: Kingsway Search Xcelerator and Extended Warranty.
Kingsway Search Xcelerator includes the following subsidiaries of the Company: CSuite Financial Partners, LLC ("CSuite"), Ravix Group, Inc. ("Ravix"), Secure Nursing Service LLC ("SNS"), Systems Products International, Inc. ("SPI"), Digital Diagnostics Inc. ("DDI"), Image Solutions, LLC ("Image Solutions"), Roundhouse Electric & Equipment Co., Inc. ("Roundhouse"), M.L.C. Plumbing, LLC (d/b/a Bud's Plumbing Service, "Bud's Plumbing"), Advanced Plumbing & Drain, LLC (d/b/a AAA Advanced Plumbing & Drain, "Advanced Plumbing") and Efficient Plumbing, LLC (d/b/a Southside Plumbing, "Southside Plumbing"). Throughout Management's Discussion and Analysis, the term the term "Kingsway Search Xcelerator" is used to refer to this segment.
CSuite is a professional services firm that provides experienced chief financial officer and other finance professionals to its clients through a variety of flexible offerings. These offerings include project, fractional and interim staffing of senior finance professionals, CFO mentoring, board advisory services, and executive search services for permanent placements for its clients throughout the United States.
Ravix provides outsourced financial services and human resources consulting to its clients on a fractional basis for both projects with definitive endpoints and ongoing engagements of indeterminate length for short or long duration engagements for customers throughout the United States.
SNS provides healthcare staffing services to acute healthcare facilities on a contract or per diem basis in the United States, primarily in California.
SPI provides software products created exclusively to serve the management needs of all types of shared-ownership properties globally.
DDI provides outsourced 24 hours a day and 7 days per week ("24/7") cardiac telemetry services for general acute care, long-term acute care and inpatient rehabilitation hospitals. Outsourcing cardiac monitoring allows hospitals to eliminate personnel callouts and human resources issues, remove distractions from onsite operations, and free up facility staff to assist directly with patient care. DDI currently has a presence in 42 states and Puerto Rico.
Image Solutions provides comprehensive information technology managed services, including equipment sales, service, and helpdesk support to customers primarily in North Carolina, Kansas, Georgia, Kentucky and Tennessee.
Roundhouse provides industrial-scale electric motor solutions, including field maintenance, in-shop repair, testing, and new motor sales primarily to midstream natural gas pipeline operators and utilities across the Permian Basin.
Kingsway Skilled Trades ("KST") includes Bud's Plumbing, Advanced Plumbing and Southside Plumbing. KST provides a comprehensive range of plumbing services, including emergency repairs, drain cleaning, water heater installations, and water treatment solutions to residential and commercial customers, primarily in Evansville, Indiana (Bud's Plumbing), Cleveland, Ohio (Advanced Plumbing) and Omaha, Nebraska (Southside Plumbing).
Extended Warranty includes the following subsidiaries of the Company: IWS Acquisition Corporation ("IWS"), Geminus Holding Company, Inc. ("Geminus"), PWI Holdings, Inc. ("PWI") and Trinity Warranty Solutions LLC ("Trinity"). As discussed in Note 5, "Acquisitions and Disposal," to the unaudited consolidated interim financial statements, the Company sold Trinity on May 8, 2026. The earnings of Trinity are included in the unaudited interim consolidated statements of operations and the segment disclosures through the date of sale. Throughout Management's Discussion and Analysis, the term "Extended Warranty" is used to refer to this segment.
IWS is a licensed motor vehicle service agreement company and is a provider of after-market vehicle protection services distributed by credit unions in 28 states and the District of Columbia to their members, with customers in all fifty states.
Geminus primarily sells vehicle service agreements to used car buyers across the United States, through its subsidiary, The Penn Warranty Corporation ("Penn"). Penn distributes these products in 46 states via independent used car dealerships and franchised car dealerships.
| Kingsway Corporation |
Trinity sold heating, ventilation, air conditioning ("HVAC"), standby generator, commercial LED lighting and commercial refrigeration warranty products and provided equipment breakdown and maintenance support services to companies across the United States. As a seller of warranty products, Trinity marketed and administered product warranty contracts for certain new and used products in the HVAC, standby generator, commercial LED lighting and commercial refrigeration industries throughout the United States. Trinity acted as an agent on behalf of the third-party insurance companies that underwrite and guaranty these warranty contracts. Trinity does not guaranty the performance underlying the warranty contracts it sells. As a provider of equipment breakdown and maintenance support services, Trinity acted as a single point of contact to its clients for both certain equipment breakdowns and scheduled maintenance of equipment. Trinity would provide such repair and breakdown services by contracting with certain HVAC providers.
NON-U.S. GAAP FINANCIAL MEASURE
Throughout this quarterly report, we present our operations in the way we believe will be most meaningful, useful and transparent to anyone using this financial information to evaluate our performance. Our unaudited consolidated interim financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") for interim financial information. In addition to the U.S. GAAP presentation of net loss, we present segment operating income as a non-U.S. GAAP financial measure, which we believe is valuable in managing our business and drawing comparisons to our peers. Below is a definition of our non-U.S. GAAP measure and its relationship to U.S. GAAP.
Segment Operating Income
Segment operating income represents one measure of the pretax profitability of our segments and is derived by subtracting direct segment expenses from direct segment revenues. Revenues and expenses are presented in the unaudited consolidated interim statements of operations, but are not subtotaled by segment; however, this information is available in total and by segment in Note 21, "Segmented Information," to the unaudited consolidated interim financial statements, regarding reportable segment information. The nearest comparable U.S. GAAP measure to total segment operating income is operating (loss) income that, in addition to total segment operating income, includes corporate general and administrative expenses and excludes segment non-operating other income, net.
SIGNIFICANT ACCOUNTING POLICIES AND CRITICAL ESTIMATES
The preparation of unaudited consolidated interim financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts and classifications of assets and liabilities, revenues and expenses, and the related disclosures of contingent assets and liabilities in the consolidated financial statements and accompanying notes. Actual results could differ from these estimates. Estimates and their underlying assumptions are reviewed on an ongoing basis. Changes in estimates are recorded in the accounting period in which they are determined.
The Company’s most critical accounting policies are those that are most important to the portrayal of its financial condition and results of operations, and that require the Company to make its most difficult and subjective judgments, often as a result of the need to make estimates of matters that are inherently uncertain. The critical accounting policies and judgments in the accompanying unaudited consolidated interim financial statements include revenue recognition; valuation of fixed maturity investments; impairment assessment of investments; valuation of limited liability investment, at fair value; valuation of deferred income taxes; accounting for business combinations; valuation and impairment assessment of intangible assets; goodwill recoverability; valuation of contingent consideration; fair value assumptions for subordinated debt obligations; fair value assumptions for subsidiary stock-based compensation awards; and valuation of redeemable noncontrolling interest. Although management believes that its estimates and assumptions are reasonable, they are based upon information available when they are made, and therefore, actual results may differ from these estimates under different assumptions or conditions.
The Company’s significant accounting policies and critical estimates are described in Management's Discussion and Analysis of Financial Condition and Results of Operations included in the 2025 Annual Report. There has been no material change subsequent to December 31, 2025 to the information previously disclosed in the 2025 Annual Report with respect to these significant accounting policies and critical estimates.
RESULTS OF CONTINUING OPERATIONS
A reconciliation of total segment operating income to net income (loss) for the three and six months ended June 30, 2026 and June 30, 2025 is presented in Table 1 below:
Table 1 Segment Operating Income
(in thousands of dollars)
| For the three months ended June 30, |
For the six months ended June 30, |
|||||||||||||||||||||||
| 2026 |
2025 |
Change |
2026 |
2025 |
Change |
|||||||||||||||||||
| Segment operating income: |
||||||||||||||||||||||||
| KSX |
$ | 3,491 | $ | 2,049 | $ | 1,442 | $ | 6,398 | $ | 3,792 | $ | 2,606 | ||||||||||||
| Extended Warranty |
675 | (63 | ) | 738 | 922 | 452 | 470 | |||||||||||||||||
| Total segment operating income |
4,166 | 1,986 | 2,180 | 7,320 | 4,244 | 3,076 | ||||||||||||||||||
| Interest and investment income, net |
2,705 | 715 | 1,990 | 3,431 | 1,025 | 2,406 | ||||||||||||||||||
| Selling, general and administrative expenses and other income not allocated to segments, net |
(4,067 | ) | (2,887 | ) | (1,180 | ) | (6,499 | ) | (5,815 | ) | (684 | ) | ||||||||||||
| Interest expense |
(1,381 | ) | (1,265 | ) | (116 | ) | (2,792 | ) | (2,495 | ) | (297 | ) | ||||||||||||
| Amortization and impairment of intangible assets |
(2,428 | ) | (1,845 | ) | (583 | ) | (4,780 | ) | (3,611 | ) | (1,169 | ) | ||||||||||||
| Gain on disposal of subsidiary |
1,347 | — | 1,347 | 1,347 | — | 1,347 | ||||||||||||||||||
| Income (loss) before income tax expense (benefit) |
342 | (3,296 | ) | 3,638 | (1,973 | ) | (6,652 | ) | 4,679 | |||||||||||||||
| Income tax expense (benefit) |
185 | (131 | ) | 316 | 138 | (395 | ) | 533 | ||||||||||||||||
| Net income (loss) |
$ | 157 | $ | (3,165 | ) | $ | 3,322 | $ | (2,111 | ) | $ | (6,257 | ) | $ | 4,146 | |||||||||
| Kingsway Corporation |
Among other items, the current U.S. conflict with Iran, the degree and pace of inflation and interest rate changes may have impacts on our business and tariffs - or retaliatory responses to such tariffs - may impact the Company’s operating income. The potential impact of current macroeconomic uncertainties on the Company’s financial condition, results of operations, and cash flows is subject to change and continues to depend on the extent and duration of these uncertainties.
The discussion below highlights the key drivers of the current and prior year results.
Kingsway Search Xcelerator
Kingsway Search Xcelerator revenue increased to $22.3 million (67.7%) for the three months ended June 30, 2026 compared to $13.3 million for the three months ended June 30, 2025 (an increase to $43.5 million year to date compared to $25.0 million prior year to date). Kingsway Search Xcelerator operating income was $3.5 million for the three months ended June 30, 2026 compared to $2.0 million for the three months ended June 30, 2025 ($6.4 million year to date compared to $3.8 million prior year to date).
Revenue and operating income were primarily impacted by the following:
| • |
The inclusion of Roundhouse for the six months ended June 30, 2026 following its acquisition on July 1, 2025. For the three months ended June 30, 2026, Roundhouse had revenue and operating income of $5.2 million and $0.8 million, respectively (revenue and operating income of $10.0 million and $1.8 million, respectively for the six months ended June 30, 2026); |
| • |
The inclusion of KST for the six months ended June 30, 2026 following the acquisitions of Bud's Plumbing in March 2025, and Advanced Plumbing and Southside Plumbing in August 2025. KST had revenue and operating income of $4.8 million and $0.1 million, respectively, for the three months ended June 30, 2026 (revenue and operating income of $9.5 million and $0.2 million, respectively for the six months ended June 30, 2026); and |
| • |
Ravix revenue increased $0.8 million to $3.3 million (34.0% increase from prior year quarter) and operating income increased $0.4 million to $1.0 million for the three months ended June 30, 2026 (increases in revenue of $0.8 million to $6.4 million and operating income of $0.3 million to $1.7 million year to date). Operating income benefitted from the increase in revenue, which was partially offset by higher general and administrative expenses for the three and six months ended June 30, 2026. The increases in revenue, operating income and general and administrative expenses was primarily due to the acquisitions of The HR Team (August 2025) and Ledgers (January 2026). |
Extended Warranty revenue decreased 2.8% (or $0.5 million) to $17.1 million for the three months ended June 30, 2026 compared with $17.6 million for the three months ended June 30, 2025, while cash sales and the average price per contract sold were up 2.4% and 4.6%, respectively, over the prior year (revenue of $35.0 million year to date compared to $34.3 million prior year to date). Extended Warranty operating income was $0.7 million for the three months ended June 30, 2026 compared with operating loss of $0.1 million for the three months ended June 30, 2025 (operating income of $0.9 million year to date compared to $0.5 million prior year to date). Extended Warranty's revenue – and therefore operating income – is impacted by the fact that VSA sales are recognized over the life of the contract, which is not on a straight-line basis. This means that in periods where cash VSA sales are declining, revenue and operating income may continue to be strong due to higher prior-year sales. Conversely, when VSA cash sales are in a period of growth – as we are seeing now – revenue and operating income may continue to lag as prior-year lower sales have a larger impact on current period revenue/operating income than current period VSA cash sales.
During the three and six months ended June 30, 2026, there was a 0.7% decrease and a 2.9% increase in claims paid at our auto Extended Warranty companies, respectively. While the number of claims were down in the quarter and year-to-date compared to prior year, the average cost per claim continued to increase primarily due to inflationary pressures on the cost of parts and labor, as well as the type of claims incurred. We are able to mitigate the impact of higher claims expense by increasing pricing and re-categorizing vehicles to ensure they are in the appropriate rate class, which we do at least annually. However, due to the deferred revenue model under US GAAP, these price increases may impact our financials more in future periods rather than in the current period.
Note that the Company sold Trinity on May 8, 2026; as such, revenue, operating income and other Extended Warranty financial results were lower for the three and six months ended June 30, 2026. However, Extended Warranty claims were not impacted by the sale of Trinity, given Trinity did not bear the risk of the warranty policies it sold and, therefore, incurred no claims expense itself.
Interest and Investment Income, Net
Interest and investment income, net was $2.7 million in the second quarter of 2026 compared to $0.7 million in the second quarter of 2025 ($3.4 million year to date compared to $1.0 million prior year to date). The increase for the second quarter and year to date of 2026 is primarily due to realized gains recognized of $2.0 million resulting from distributions received during the second quarter of 2026 from private company investments and investments held by Argo Holdings Fund I, LLC ("Argo Holdings"). Also, the gain on change in fair value recognized by Argo Holdings was $0.4 million for the three months ended June 30, 2026 compared to $0.2 million for the three months ended June 30, 2025 ($0.7 million year to date compared to $0.2 million prior year to date).
Selling, General and Administrative Expenses and Other Income not Allocated to Segments, Net
Selling, general and administrative expenses and other income not allocated to segments was a net expense of $4.1 million in the second quarter of 2026 compared to $2.9 million in the second quarter of 2025 ($6.5 million year to date compared to $5.8 million prior year to date). Included are expenses associated with our corporate holding company, expenses associated with our Operator-in-Residence who search for our next acquisitions, revenue and expenses associated with our various other investments (such as Argo Holdings) that are accounted for on a consolidated basis, (loss) gain on change in fair value of debt and loss on extinguishment of debt.
The increase in net expense for the three and six months ended June 30, 2026 is primarily attributable to higher stock-based compensation expenses during the three months ended June 30, 2026 compared to the same period in 2025. See Note 16, "Stock-Based Compensation," to the unaudited consolidated interim financial statements, for further discussion of stock options granted during the second quarter of 2026. The six months ended June 30, 2026 increase was partially offset by lower acquisition and search related expenses during the six months ended June 30, 2026 compared to the same period in 2025.
See Note 10, "Debt," to the unaudited consolidated interim financial statements, for further discussion of changes in fair value of debt and loss on extinguishment of debt recorded for the three and six months ended June 30, 2026 and June 30, 2025.
| Kingsway Corporation |
Interest Expense
Interest expense for the second quarter of 2026 was $1.4 million compared to $1.3 million in the second quarter of 2025 ($2.8 million year to date compared to $2.5 million prior year to date). The increase for the three and six months ended June 30, 2026 is primarily due to the inclusion of the Roundhouse and KPH loans for the second quarter and year to date of 2026, partially offset by reduced expense for existing loans due to principal amortization.
See Note 10, "Debt," to the unaudited consolidated interim financial statements for further details.
Amortization and Impairment of Intangible Assets
Amortization of intangible assets was $2.1 million in the second quarter of 2026 compared to $1.7 million in the second quarter of 2025 ($4.3 million year to date compared to $3.4 million prior year to date). The increase is primarily due to the inclusion of Roundhouse, Advanced Plumbing and Southside Plumbing (acquired in the third quarter of 2025) for the three and six months ended June 30, 2026, partially offset by decreased amortization expense for the Company's other intangible assets.
Impairment of intangible assets was $0.3 million in the second quarter of 2026 compared to $0.1 million in the second quarter of 2025 ($0.5 million year to date compared to $0.2 million prior year to date). The Company's indefinite-lived intangible assets consist of trade names, which are assessed for impairment annually as of November 30, or more frequently if events or circumstances indicate that the carrying value may not be recoverable. At each quarter end of the first and second quarters of 2026 and 2025, the Company determined that certain of its trade name intangible assets should be further examined under a quantitative approach due to actual revenue coming in lower than previous projections. Based upon this assessment, the Company recorded an impairment charge during the second quarter of 2026 related to the CSuite indefinite-lived trade name (year to date impairment related to CSuite and SNS indefinite-lived trade names); and during the second quarter and year to date of 2025 related to the Ravix indefinite-lived trade name. The reductions in value are primarily due to higher discount rates and a reduction in projected revenue. See Note 8,"Intangible Assets," to the unaudited consolidated interim financial statements, for further discussion.
On May 8, 2026, the Company sold its subsidiary, Trinity. As a result of the sale, the Company recognized a net gain on disposal of $1.3 million during the three and six months ended June 30, 2026. The sale of Trinity did not represent a strategic shift that will have a major effect on the Company's operations or financial results; therefore, Trinity is not presented as a discontinued operation. See Note 5,"Acquisitions and Disposal," to the unaudited consolidated interim financial statements, for further discussion of the Trinity disposal.
Income Tax Expense (Benefit)
Income tax for the second quarter of 2026 was an expense of $0.2 million compared to a benefit of $0.1 million in the second quarter of 2025 (expense of $0.1 million year to date compared to a benefit of $0.4 million prior year to date). For the three and six months ended June 30, 2026, the Company reported a tax expense primarily due to state income tax expense. For the three and six months ended June 30, 2025, the Company reported a tax benefit primarily due to the release of its valuation allowance associated with indefinite life business interest expense carryforwards. See Note 14, "Income Taxes," to the unaudited consolidated interim financial statements, for additional detail of the income tax expense (benefit) recorded for the three and six months ended June 30, 2026 and June 30, 2025.
INVESTMENTS
Portfolio Composition
See Note 2(f), "Summary of Significant Accounting Policies - Investments," to the consolidated financial statements in the 2025 Annual Report for an overview of how we account for our various investments.
At June 30, 2026, we held cash and cash equivalents, restricted cash and investments with a carrying value of $59.1 million. Our operations typically invest in U.S. dollar-denominated instruments to mitigate their exposure to currency rate fluctuations.
Table 2 below summarizes the carrying value of investments, including cash and cash equivalents and restricted cash, at the dates indicated.
TABLE 2 Carrying value of investments, including cash and cash equivalents and restricted cash
(in thousands of dollars, except for percentages)
| Type of investment |
June 30, 2026 |
% of Total |
December 31, 2025 |
% of Total |
||||||||||||
| Fixed maturities: |
||||||||||||||||
| U.S. government, government agencies and authorities |
13,835 | 23.4 | % | 13,491 | 23.3 | % | ||||||||||
| States, municipalities and political subdivisions |
1,225 | 2.1 | % | 1,771 | 3.1 | % | ||||||||||
| Mortgage-backed |
11,412 | 19.3 | % | 9,818 | 17.0 | % | ||||||||||
| Asset-backed |
1,665 | 2.8 | % | 1,364 | 2.4 | % | ||||||||||
| Corporate |
10,419 | 17.6 | % | 10,321 | 17.8 | % | ||||||||||
| Total fixed maturities |
38,556 | 65.2 | % | 36,765 | 63.5 | % | ||||||||||
| Limited liability investments |
637 | 1.1 | % | 649 | 1.1 | % | ||||||||||
| Limited liability investment, at fair value |
4,127 | 7.0 | % | 3,476 | 6.0 | % | ||||||||||
| Investments in private companies |
575 | 1.0 | % | 575 | 1.0 | % | ||||||||||
| Short-term investments |
179 | 0.3 | % | 178 | 0.3 | % | ||||||||||
| Total investments |
44,074 | 74.6 | % | 41,643 | 71.9 | % | ||||||||||
| Cash and cash equivalents |
7,366 | 12.4 | % | 8,306 | 14.3 | % | ||||||||||
| Restricted cash |
7,679 | 13.0 | % | 7,965 | 13.8 | % | ||||||||||
| Total |
59,119 | 100.0 | % | 57,914 | 100.0 | % | ||||||||||
| Kingsway Corporation |
Investment Impairment
The Company performs a quarterly analysis of its investments to determine if declines in fair value may result in the recognition of impairment losses in net income (loss). Factors considered in the determination of whether or not an impairment loss is recognized in net income (loss) include a current intention or need to sell the security or an indication that a credit loss exists. See the "Significant Accounting Policies and Critical Estimates" section of Management's Discussion and Analysis of Financial Condition included in the 2025 Annual Report for further information regarding the Company's detailed analysis and factors considered in establishing an impairment loss on an investment.
The Company's fixed maturities are subject to declines in fair value below amortized cost that may result in the recognition of impairment losses in net income (loss). If the decline in fair value is due to credit factors and the Company does not expect to receive cash flows sufficient to support the entire amortized cost basis, the credit loss is reported in the consolidated statements of operations in the period that the declines are evaluated. Significant judgment is required in the determination of whether a credit loss has occurred for a security. The Company considers all available evidence when determining whether a security requires a credit allowance to be recorded, including the financial condition and expected near-term and long term prospects of the issuer, whether the issuer is current with interest and principal payments, credit ratings on the security or changes in ratings over time, general market conditions, industry, sector or other specific factors and whether the Company expects to receive cash flows sufficient to recover the entire amortized cost basis of the security.
There were no impairment losses recorded related to investments during the three and six months ended June 30, 2026 and June 30, 2025.
At June 30, 2026 and December 31, 2025, the gross unrealized losses for fixed maturities amounted to $0.6 million and $0.5 million, respectively, and there were no unrealized losses attributable to non-investment grade fixed maturities.
DEBT
The principal and carrying value of the Company's debt instruments at June 30, 2026 and December 31, 2025 are as follows:
| (in thousands) |
June 30, 2026 |
December 31, 2025 |
||||||||||||||
| Principal |
Carrying Value |
Principal |
Carrying Value |
|||||||||||||
| Bank loans: |
||||||||||||||||
| KSX Term Loans |
$ | 34,323 | $ | 33,794 | $ | 36,135 | $ | 35,551 | ||||||||
| KSX Revolvers |
2,229 | 2,229 | 2,053 | 2,053 | ||||||||||||
| Extended Warranty Term Loan and DDTL |
10,929 | 10,873 | 15,504 | 15,438 | ||||||||||||
| Extended Warranty Revolver |
3,750 | 3,750 | 2,000 | 2,000 | ||||||||||||
| Total bank loans |
51,231 | 50,646 | 55,692 | 55,042 | ||||||||||||
| Notes payable: |
||||||||||||||||
| KSX Notes Payable |
1,967 | 1,782 | 1,164 | 1,016 | ||||||||||||
| KSX Vehicle Loans |
719 | 719 | 630 | 630 | ||||||||||||
| KSX Equipment Loans |
715 | 715 | 326 | 326 | ||||||||||||
| Total notes payable |
3,401 | 3,216 | 2,120 | 1,972 | ||||||||||||
| Subordinated debt |
15,000 | 13,428 | 15,000 | 13,698 | ||||||||||||
| Total Debt |
$ | 69,632 | $ | 67,290 | $ | 72,812 | $ | 70,712 | ||||||||
See Note 10, "Debt," to the unaudited consolidated interim financial statements for a detailed discussion of the Company’s debt instruments. Changes related to the Company’s debt during the six months ended June 30, 2026 are further described below.
Bank Loans
Our bank loans contain a number of covenants, including, but not limited to, a leverage ratio and a fixed charge ratio and limits on annual capital expenditures, all of which are as defined in and calculated pursuant to the respective loan that, among other things, restrict the borrowing company’s ability to incur additional indebtedness, create liens, make dividends and distributions, engage in mergers, acquisitions and consolidations, make certain payments and investments and dispose of certain assets.
During the six months ended June 30, 2026:
| • |
Ravix, Ravix LLC and CSuite entered into a sixth amendment to the Ravix term loan that provides for adding a second tranche to the Ravix term loan with a principal amount of $0.5 million; |
| • |
KWH borrowed $1.75 million under the KWH revolver; and |
| • |
DDI borrowed $0.2 million and made repayments of less than $0.1 million under the DDI revolver. |
Beginning March 31, 2024 through June 30, 2026, SNS was in default under its loan due to debt covenant violations related to the leverage and fixed charge ratios (measured quarterly). In February 2026, SNS and the lender amended the credit agreement to (1) extend the SNS revolver maturity date to be June 2, 2026; and (2) suspend monthly principal payments beginning February 2026 through May 2026, with the next principal payment resuming in June 2026. In July 2026, SNS and the lender amended the credit agreement to (1) extend the SNS revolver maturity date to be December 2, 2026; and (2) suspend monthly principal payments through November 2026, with the next principal payment resuming in December 2026.
Beginning September 30, 2025 through June 30, 2026, DDI was in default under its loan due to a debt covenant violation related to the fixed charge ratio (measured quarterly).
| Kingsway Corporation |
Each of SNS and DDI has entered into an amendment to its respective loan that waives the events of default for the fiscal quarter ended June 30, 2026. As of the report date, there is some uncertainty as to whether the companies will be in compliance with the covenants in future periods, and if not, when the companies will be able to cure any potential violations. As a result, the Company has included the total principal balance due after one-year related to the DDI Loan of $2.6 million and the SNS Loan of $1.7 million in short-term and current portion of long-term debt in the consolidated balance sheet as of June 30, 2026. A default may permit the lender to declare the amounts owed under the loans immediately due and payable, exercise their rights with respect to collateral securing the obligations, and/or exercise any other rights and remedies available.
At June 30, 2026, KPH was in default under the KPH Loan due to a debt covenant violation related to the leverage and fixed charge ratios (measured quarterly). As of the report date, the Company has not received a waiver or amendment from the lender regarding this non-compliance. As a result, the Company has reclassified the total principal balance of the KPH Loan due after one-year of $3.3 million from long-term debt to short-term and current portion of long-term debt in the consolidated balance sheet as of June 30, 2026. The Company is in active discussions with the lender with respect to obtaining a waiver. As of the report date, there is some uncertainty as to whether the Company will be in compliance with the covenants in future periods, and if not, when the Company will be able to cure any potential violations. A default may permit the lender to declare the amounts owed under the KPH Loan immediately due and payable, exercise their rights with respect to collateral securing the obligation, and/or exercise any other rights and remedies available.
All of the KSX and Extended Warranty indebtedness arises from individual, stand-alone credit agreements with the applicable Company subsidiary. None of such indebtedness is guaranteed by the Company or any other subsidiary or affiliate of the Company other than the borrower entity and its direct subsidiary, if any, and there are no cross-collateral, cross-default or similar provisions in the credit agreements.
Notes Payable
On January 2, 2026, Ravix entered into a seller note with a principal amount of $0.9 million in connection with an asset acquisition. The seller note was used to partially finance the asset acquisition.
On March 4, 2026, Roundhouse borrowed $0.4 million under an equipment line of credit. The Roundhouse equipment loan matures on March 1, 2033, requires monthly payments of principal and interest and has an annual fixed interest rate of 7.0%.
Subordinated Debt
The Company's subordinated debt is measured and reported at fair value. At June 30, 2026, the carrying value of the subordinated debt is $13.4 million. The fair value of the subordinated debt is calculated using a model based on significant market observable inputs and inputs developed by a third party. For a description of the market observable inputs and inputs developed by a third party used in determining fair value of debt, see Note 22, "Fair Value of Financial Instruments," to the unaudited consolidated interim financial statements.
Though changes in the market observable swap rates will continue to introduce some volatility each quarter to the Company’s reported gain or loss on change in fair value of debt, changes in the credit spread assumption developed by the third party does not introduce volatility to the Company’s consolidated statements of operations. The fair value of the Company’s subordinated debt will eventually equal the principal value totaling $15.0 million of the subordinated debt by the time of the stated redemption date of the remaining trust, which matures on May 22, 2033.
RECENTLY ISSUED ACCOUNTING STANDARDS
See Note 4, "Recently Issued Accounting Standards," to the unaudited consolidated interim financial statements, for discussion of certain accounting standards that may be applicable to the Company's current and future consolidated financial statements.
LIQUIDITY AND CAPITAL RESOURCES
The purpose of liquidity management is to ensure there is sufficient cash to meet all financial commitments and obligations as they fall due. The liquidity requirements of the Company and its subsidiaries have been met primarily by funds generated from operations, capital raising, disposal of subsidiaries, investment maturities and investment income, and other returns received on investments and from the sale of investments.
A significant portion of the cash provided by our Extended Warranty companies is required to be placed into restricted trust accounts, as determined by the insurers who back-up our service contracts, in order to fund future expected claims. On a periodic basis (quarterly or annually), we may be required to contribute more into the restricted accounts or we may be permitted to draw additional funds from the restricted accounts, dependent upon actuarial analyses performed by the insurers regarding sufficiency of funds to cover future expected claims. A substantial portion of the restricted trust accounts are invested in fixed maturities and other instruments that have durations similar to the expected future claim projections.
Cash provided from these sources is used primarily for warranty expenses, business service expenses, debt servicing, acquisitions and operating expenses of the holding company.
The Company's Kingsway Search Xcelerator and Extended Warranty subsidiaries fund their obligations primarily through service fee and other revenue.
Cash Flows
During the six months ended June 30, 2026, the net cash provided by operating activities was $1.2 million, primarily due to operating income from the Kingsway Search Xcelerator and Extended Warranty (the latter due to higher cash sales) segments. During the six months ended June 30, 2025, the Company reported $1.5 million of net cash used in operating activities, primarily due to cash paid to settle the Ravix contingent liability of $2.3 million that is reported as an operating activity, partially offset by operating income from the Extended Warranty and Kingsway Search Xcelerator segments.
During the six months ended June 30, 2026, the net cash provided by investing activities was $3.3 million. This source of cash is primarily attributed to proceeds received from the sale of Trinity, net of cash disposed, of $4.4 million and cash distributions received from private company investments and investments held by Argo Holdings of $2.0 million, partially offset by purchases of fixed maturities in excess of sales and maturities of fixed maturities, as well as net purchases of property and equipment. During the six months ended June 30, 2025, the net cash used in investing activities was $13.7 million. This use of cash is primarily attributed to the acquisition of Bud's Plumbing, net of cash acquired, and cash paid on June 30, 2025 to pre-fund the acquisition of Roundhouse that occurred on July 1, 2025 of $10.3 million.
During the six months ended June 30, 2026, the net cash used in financing activities was $5.7 million. This use of cash was primarily attributed to principal repayments on debt of $7.1 million, distributions to noncontrolling interest holders of $0.7 million and payment of preferred stock dividends of $0.6 million, partially offset by principal proceeds from debt of $3.0 million. During the six months ended June 30, 2025, the net cash provided by financing activities was $21.5 million. This source of cash was primarily attributed to net proceeds from the issuance of common stock of $15.6 million, principal proceeds from debt of $9.4 million and proceeds from the issuance of Class C and Class D preferred stock of $6.0 million and $2.0 million, respectively, partially offset by principal repayment on debt of $10.4 million, cash paid to settle the Ravix contingent liability of $0.4 million, payment of preferred stock dividends of $0.4 million and cash paid for repurchases of common stock of $0.3 million.
| Kingsway Corporation |
Holding Company Liquidity
The liquidity of the holding company is managed separately from its subsidiaries. The obligations of the holding company primarily consist of holding company operating expenses; transaction-related expenses; investments; and any other extraordinary demands on the holding company. The holding company does not provide guarantees to any of the operating companies with respect to borrowings that they might have and, as such, any debt incurred by the operating companies is non-recourse to the holding company. In addition, any debt incurred by the operating companies does not have cross-collateral or cross-default provisions; therefore, any default that might arise is limited only to the underlying borrower that might be in default and does not extend to other operating companies’ debt.
Pursuant to satisfying the covenants under the KWH bank loan, distributions to the holding company in an aggregate amount not to exceed $1.5 million in any 12-month period are permitted. Also, the holding company is permitted to receive a portion of the excess cash flow (as defined in the loan document) generated by the KWH subsidiaries in the previous year.
The holding company’s liquidity, defined as the amount of cash in the bank accounts of Kingsway Corporation and Kingsway America Inc., was $1.0 million and $1.0 million at June 30, 2026 and December 31, 2025, respectively, which excludes future actions available to the holding company that could be taken to generate liquidity. Such future actions include, but are not limited to, issuance of equity securities and distributions from the Kingsway Search Xcelerator and Extended Warranty operating companies subject to certain loan covenants that may be in place at each operating company. The holding company cash amounts are reflected in the cash and cash equivalents of $7.4 million and $8.3 million reported at June 30, 2026 and December 31, 2025, respectively, on the Company’s consolidated balance sheets.
Item 3. Quantitative and Qualitative Disclosures about Market Risk
We are a smaller reporting company as defined in Rule 12b-2 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"); therefore, pursuant to Regulation S-K, we are not required to make disclosures under this Item.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
The Company’s management, with the participation of our Chief Executive Officer and Chief Financial Officer, has conducted an evaluation of the effectiveness of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act as of June 30, 2026.
The Company’s disclosure controls and procedures are designed to ensure that information required to be disclosed in the reports the Company files under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to the Company’s management, including the Company’s Chief Executive Officer and Chief Financial Officer, to allow for timely decisions regarding required disclosures.
In designing and evaluating our disclosure controls and procedures, the Company’s management recognizes that disclosure controls and procedures, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the disclosure controls and procedures are met. Our disclosure controls and procedures have been designed to meet reasonable assurance standards. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints that require the Company’s management to apply its judgment in evaluating the benefits of possible controls and procedures relative to their costs. The design of any disclosure controls and procedures also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.
Based on the evaluation of our disclosure controls and procedures, the Company's Chief Executive Officer and Chief Financial Officer have concluded that, as of June 30, 2026, the Company’s disclosure controls and procedures were effective.
Changes in Internal Control over Financial Reporting
There have been no changes in the Company's internal control over financial reporting during the period beginning April 1, 2026, and ending June 30, 2026, that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.
| Kingsway Corporation |
Information concerning pending legal proceedings is incorporated herein by reference to Note 24, "Commitments and Contingencies," to the unaudited consolidated interim financial statements in Part I of this Form 10-Q.
There have been no material changes with respect to those risk factors previously disclosed in our 2025 Annual Report.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
None.
Item 3. Defaults Upon Senior Securities
None
Item 4. Mine Safety Disclosures
Not applicable.
During the quarter ended June 30, 2026, director or officer (as defined in Rule 16a-1(f) under the Exchange Act) of the Company adopted, modified or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement” (as each term is defined in Item 408 of Regulation S-K).
| 3.1 | Certificate of Amendment to the Restated Certificate of Incorporation of Kingsway Corporation, dated May 18, 2026 (included as Exhibit 3.1 to the Form 8-K, filed May 19, 2026, and incorporated herein by reference). | |
| 3.2 | Amendment Number 1 to the By-Laws of Kingsway Corporation, dated May 18, 2026 (included as Exhibit 3.2 to the Form 8-K, filed May 19, 2026, and incorporated herein by reference). | |
| 10.1 | Amendment No. 1 to the Kingsway Corporation 2020 Equity Incentive Plan (included as Schedule A to the Schedule 14A Definitive Additional Soliciting Material, filed April 28, 2026, and incorporated herein by reference). | |
| 10.2 | Director Retainer Agreement, dated as of May 18, 2026, by and between Kingsway Corporation and Adam Patinkin. | |
| 10.3 | Membership Interest Purchase Agreement, dated May 8, 2026, by and between Kingsway Warranty Holdings LLC and Trinity Warranty Holding LLC. (included as Exhibit 10.1 to the Form 8-K, filed May 11, 2026, and incorporated herein by reference). | |
| Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
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| Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
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| Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
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| Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
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| 101.INS |
Inline XBRL Instance Document |
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| 101.SCH |
Inline XBRL Taxonomy Extension Schema |
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| 101.CAL |
Inline XBRL Taxonomy Extension Calculation Linkbase |
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| 101.DEF |
Inline XBRL Taxonomy Extension Definition Linkbase |
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Inline XBRL Taxonomy Extension Label Linkbase |
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| 101.PRE |
Inline XBRL Taxonomy Extension Presentation Linkbase |
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| 104 |
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) |
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 thereunto duly authorized.
| KINGSWAY CORPORATION |
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| Date: |
August 6, 2026 | By: |
/s/ John T. Fitzgerald |
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| John T. Fitzgerald, President, Chief Executive Officer and Director |
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| (principal executive officer) |
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| Date: |
August 6, 2026 | By: |
/s/ Kent A. Hansen |
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| Kent A. Hansen, Chief Financial Officer and Executive Vice President |
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| (principal financial officer) |
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