Company Details

Directors and Officers

The following are the names, office(s) held and principal occupations of the directors and officers of the Company:

Colin M. Simpson
Trustee
(Corporate Director/Consultant)

Robert Morrison
Trustee
(Corporate Director)

Leonard F. Ruggins
Trustee
(Corporate Director)


Profile

The Trust was created to provide holders with exposure to a senior note issued by an affiliate of Kingsway Financial Services Inc. Holders of the LROC Preferred Units will receive primarily tax-deferred quarterly distributions of $0.3125 per LROC Preferred Unit representing a yield of 5.00% per annum on the $25.00 per LROC Preferred Unit offering price.

General Information

Summary Statistics as at December 16, 2010

Distribution Policy

Distributions will be declared and paid quarterly on the Units. LROC Preferred Unit distributions will consist primarily of returns of capital and may, in certain circumstances, include capital gains distributions. For historical distribution amounts, please see distribution information.

Retraction Rights

The following provides a summary of the retraction rights available to Unitholders. Please refer to the prospectus for complete details.

Unlike most mutual funds the Units are listed allowing holders to exit by selling their Units in the stock market. In addition, they are also retractable on demand at any time by the holders, but holders will only receive the proceeds from such retraction on the last business day of a month.

On that date Unitholders are entitled to receive the lesser of:

  • 90% of the market price of the LROC Preferred Units on the principal stock exchange on which the LROC Preferred Units are listed during the ten consecutive trading period commencing on the fifth business day of a calendar month prior to the next retraction date; and
  • 100% of the closing market price of the LROC Preferred Units on the principal stock exchange on which the LROC Preferred Units are listed on the Retraction Notice Date immediately following the date that the LROC Preferred Units were surrendered for retraction.

The total retraction price payable by the Trust will be satisfied by way of a cash payment subject to a $10,000 monthly limit. If the total cash payment for all LROC Preferred Units surrendered for the retraction in a month is greater than $10,000, then the payment will be satisfied by way of a distribution of assets of the Trust consisting of LP Units.

Redemption

The Trust is scheduled to wind up on or about June 30, 2015, and at that time, the Trust will distribute to Unitholders an amount per LROC Preferred Unit equal to the lesser of: (i) the subscription price of $25.00, together with any accrued and unpaid distributions; and (ii) the amount received by the Trust from KL LP as distributions on the LP Units held by the Trust from proceeds from the sale of Portfolio Securities which are delivered to KL LP on the settlement of the Purchase Agreement (net of certain fees and expenses).

Taxation

Distributions received by the Trust will be distributed to the Unitholders quarterly as tax-efficient returns of capital. Amounts received as a return of capital are not taxable but must be used to reduce the adjusted cost base of an investor's Units.