The
following constitutes Amendment No. 4 (“Amendment No. 4”) to the Schedule 13D
filed by the undersigned. This Amendment No. 4 amends the Schedule
13D as specifically set forth.
Item
2.
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Identity and
Background
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Item 2 is
hereby amended in its entirety to read as follows:
Items
2(a), 2(b) and 2(c)
This Statement is
jointly filed by Hallmark Financial Services, Inc., a Nevada corporation
(“Hallmark”), American Hallmark Insurance Company of Texas, a Texas corporation
(“AHIC”), Hallmark Specialty Insurance Company, an Oklahoma corporation
(“HSIC”), Mark E. Schwarz, C. Gregory Peters, Mark E. Pape and Robert M. Fishman
(collectively, the “Reporting Persons”). Each of the Reporting Persons is party
to that certain Joint Filing and Solicitation Agreement, as amended, as further
described in Item 6. Accordingly, the Reporting Persons are hereby
filing a joint Schedule 13D.
Because
AHIC and HSIC are wholly-owned subsidiaries of
Hallmark, Hallmark may be deemed, pursuant to Rule 13d-3
of the Securities Exchange Act of 1934, as amended (the “Act”), to be the
beneficial owner of all the shares of Common Stock of the Company held by AHIC
and HSIC. Set forth on Schedule A annexed to Amendment No. 2 to the
Schedule 13D is the name and present principal occupation or employment and the
name, principal business and address of any corporation or organization in which
such employment is conducted of the directors and executive officers of each of
Hallmark, AHIC and HSIC. As the Executive Chairman of Hallmark, with
voting and dispositive power over Hallmark’s, AHIC’s and HSIC’s portfolio of
securities, Mark E. Schwarz may be deemed to be the beneficial owner of all the
shares of Common Stock of the Company held by Hallmark, AHIC and
HSIC.
The
principal business address of Hallmark, AHIC and HSIC is 777 Main Street, Suite
1000, Fort Worth, TX 76102. The principal business address of Mark E.
Schwarz is c/o Newcastle Capital Management, L.P., 200 Crescent Court, Suite
1400, Dallas, TX 75201. The principal business address of Mr. Peters
is 7941 Katy Freeway, #529, Houston, TX 77024. The principal business
address of Mr. Pape is 12050 Meadow Lake, Copper Canyon, TX
76226. The principal business address of Mr. Fishman is 2316 Clover
Lane, Northfield, IL 60093.
The
principal business of Hallmark, AHIC and HSIC is marketing, distributing,
underwriting, and servicing of property and casualty insurance products for
businesses and individuals in the United States. The principal
occupation of Mark E. Schwarz is serving as a Principal of Newcastle Capital
Management, L.P., a private investment management firm. The principal
occupation of Mr. Peters is serving as Senior Vice President of Southwest
Insurance Partners, Inc., a
n
investment company with operating subsidiaries in the property & casualty
and life, accident & health insurance sectors.
The principal
occupation of Mr. Pape is serving as a partner of Tatum LLC, an executive
services firm. The principal occupation of Mr. Fishman is serving as
an insurance industry consultant.
Item
2(d)
During the last five
years, none of the Reporting Persons or the persons listed in Schedule A has
been convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors).
Item
2(e)
During the last five
years, none of the Reporting Persons or the persons listed in Schedule A has
been a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction, and as a result of such proceeding, was or is subject to
a judgment, decree or final order enjoining future violations of, or prohibiting
or mandating activities subject to, federal or state securities laws or finding
any violation with respect to such laws.
Item
2(f)
Hallmark, AHIC and
HSIC are organized under the laws of Nevada, Texas and Oklahoma,
respectively. Messrs. Schwarz, Peters, Pape and Fishman are citizens
of the United States.
Item
5.
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Interest in Securities
of the Issuer.
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Item
5(a)-(c) is hereby amended in its entirety to read as follows:
(a) The
aggregate percentage of shares of Common Stock reported to be owned by the
Reporting Persons is based upon 14,437,355 shares outstanding, which is the
total number of shares of Common Stock outstanding on March 25, 2009 as reported
in the Company’s Preliminary Proxy Statement on Schedule 14A filed March 27,
2009.
As of the
filing date of this Amendment No. 4, AHIC owned 1,308,615 shares of Common
Stock, representing approximately 9.1% of the Company’s issued and outstanding
Common Stock.
As of the
filing date of this Amendment No. 4, HSIC owned 100,000 shares of Common Stock,
representing
approximately 0.7% of the Company’s issued and outstanding Common
Stock.
As of the
filing date of this Amendment No. 4, Hallmark owned 21,000 shares of Common
Stock, representing approximately 0.1% of the Company’s issued and outstanding
Common Stock. As the parent of AHIC and HSIC, Hallmark may be deemed
to beneficially own an additional 1,308,615 shares of Common Stock owned by AHIC
and an additional 100,000 shares of Common Stock owned by HSIC, representing
(together with shares owned directly by Hallmark) an aggregate of 1,429,615
shares of Common Stock or approximately 9.9% of the issued and outstanding
Common Stock.
As of the
filing date of this Amendment No. 4, Mark E. Schwarz did not own any shares of
Common Stock
directly
. As
the Executive Chairman of Hallmark with voting and dispositive power over
Hallmark’s, AHIC’s and HSIC’s portfolio of securities, Mr. Schwarz may be deemed
to beneficially own the 1,429,615 shares of Common Stock owned in the aggregate
by Hallmark, AHIC and HSIC. Mr. Schwarz disclaims beneficial
ownership of such shares.
Messrs.
Peters, Pape and Fishman do not currently own any shares of Common Stock
directly. Each of Messrs. Peters, Pape and Fishman, by virtue of his
status as a director nominee of Hallmark, may be deemed to beneficially own the
shares of Common Stock beneficially owned by Hallmark. Messrs.
Peters
,
Pape and Fishman each disclaim beneficial ownership of such shares.
(b) Each
of the Reporting Persons has the sole power to vote and dispose of the shares of
Common Stock reported as owned by them in this Statement.
(c) No
transactions in the Company’s shares of Common Stock by the Reporting Persons
occurred during the past 60 days.
Item
6.
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Contracts,
Arrangements, Understandings or Relationships With Respect to Securities
of the Issuer
.
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Item 6 is
hereby amended to add the following:
On
January 12, 2009, the Reporting Persons (other than Mark E. Schwarz) entered
into a Joint Filing and Solicitation Agreement in which, among other things, (a)
the parties agreed to the joint filing on behalf of each of them of statements
on Schedule 13D with respect to the securities of the Company, (b) the parties
agreed to solicit proxies or written consents for the election of the Nominees,
or any other person(s) nominated by Hallmark, to the Company’s Board of
Directors at the Annual Meeting (the “Solicitation”), and (c) Hallmark agreed to
bear all expenses incurred in connection with the Reporting Persons’ activities,
including approved expenses incurred by any of the parties in connection with
the Solicitation, subject to certain limitations. On March 30, 2009,
the Joint Filing and Solicitation Agreement was amended to add Mark E. Schwarz
as a party thereto. A copy of Amendment No. 1 to the Joint Filing and
Solicitation Agreement is attached hereto as Exhibit 99.1 and is incorporated
herein by reference.
Item
7.
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Materials to be Filed
as Exhibits
.
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Item 7 is
hereby amended to add the following exhibit:
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99.1
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Amendment
No. 1 to Joint Filing and Solicitation Agreement by and among Hallmark
Financial Services, Inc., American Hallmark Insurance Company of Texas,
Hallmark Specialty Insurance Company, Mark E. Schwarz, C. Gregory Peters,
Mark E. Pape and Robert M. Fishman, dated March 30,
2009.
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After due
inquiry and to the best of his knowledge and belief, each of the undersigned
certifies that the information set forth in this statement is true, complete and
correct.
Dated:
April 1, 2009
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Hallmark
Financial Services, Inc.
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By:
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Name:
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Mark
E. Schwarz
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Title:
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Executive
Chairman
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American
Hallmark Insurance Company of Texas
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By:
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Name:
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Mark
E. Schwarz
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Title:
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Director
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Hallmark
Specialty Insurance Company
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By:
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Name:
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Mark
E. Schwarz
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Title:
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Director
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By:
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Name:
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Mark
E. Schwarz
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By:
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Name:
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C.
Gregory Peters
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By:
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Name:
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Robert
M. Fishman
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