UNITED STATES
SECURITIES AND EXCHANGE
COMMISSION
Washington, D.C.
20549
SCHEDULE 13D
(Rule
13d-101)
INFORMATION
TO BE INCLUDED IN STATEMENTS FILED PURSUANT
TO
§ 240.13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO
§ 240.13d-2(a)
(Amendment
No. 2)
1
Specialty Underwriters’
Alliance Inc.
(Name of
Issuer)
Common
Stock, par value $.01 per
share
(Title of
Class of Securities)
STEVEN
WOLOSKY, ESQ.
OLSHAN
GRUNDMAN FROME ROSENZWEIG & WOLOSKY LLP
Park
Avenue Tower
65 East
55th Street
New York,
New York 10022
(212)
451-2300
(Name,
Address and Telephone Number of Person
Authorized
to Receive Notices and Communications)
(Date of
Event Which Requires Filing of This Statement)
If the
filing person has previously filed a statement on Schedule 13G to report the
acquisition that is the subject of this Schedule 13D, and is filing this
schedule because of §§ 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check
the following box
¨
.
Note:
Schedules
filed in paper format shall include a signed original and five copies of the
schedule, including all exhibits.
See
§ 240.13d-7 for
other parties to whom copies are to be sent.
_______________
1
The remainder of this cover page shall be filled out for a reporting person’s
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The
information required on the remainder of this cover page shall not be deemed to
be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934
(“Act”) or otherwise subject to the liabilities of that section of the Act but
shall be subject to all other provisions of the Act (however,
see
the
Notes
).
1
|
NAME
OF REPORTING PERSON
Hallmark
Financial Services, Inc.
|
2
|
CHECK
THE APPROPRIATE BOX IF A MEMBER OF A GROUP
|
(a)
x
(b)
o
|
3
|
SEC
USE ONLY
|
4
|
SOURCE
OF FUNDS
|
5
|
CHECK
BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d)
OR 2(e)
|
¨
|
6
|
CITIZENSHIP
OR PLACE OF ORGANIZATION
|
NUMBER
OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
|
7
|
SOLE
VOTING POWER
|
8
|
SHARED
VOTING POWER
|
9
|
SOLE
DISPOSITIVE POWER
|
10
|
SHARED
DISPOSITIVE POWER
|
11
|
AGGREGATE
AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
|
12
|
CHECK
BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES
|
¨
|
13
|
PERCENT
OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
|
14
|
TYPE
OF REPORTING PERSON
|
1
|
NAME
OF REPORTING PERSON
American
Hallmark Insurance Company of Texas
|
2
|
CHECK
THE APPROPRIATE BOX IF A MEMBER OF A GROUP
|
(a)
x
(b)
o
|
3
|
SEC
USE ONLY
|
4
|
SOURCE
OF FUNDS
|
5
|
CHECK
BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d)
OR 2(e)
|
¨
|
6
|
CITIZENSHIP
OR PLACE OF ORGANIZATION
|
NUMBER
OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
|
7
|
SOLE
VOTING POWER
|
8
|
SHARED
VOTING POWER
|
9
|
SOLE
DISPOSITIVE POWER
|
10
|
SHARED
DISPOSITIVE POWER
|
11
|
AGGREGATE
AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
|
12
|
CHECK
BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES
|
¨
|
13
|
PERCENT
OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
|
14
|
TYPE
OF REPORTING PERSON
|
1
|
NAME
OF REPORTING PERSON
Hallmark
Specialty Insurance Company
|
2
|
CHECK
THE APPROPRIATE BOX IF A MEMBER OF A GROUP
|
(a)
x
(b)
o
|
3
|
SEC
USE ONLY
|
4
|
SOURCE
OF FUNDS
|
5
|
CHECK
BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d)
OR 2(e)
|
¨
|
6
|
CITIZENSHIP
OR PLACE OF ORGANIZATION
|
NUMBER
OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
|
7
|
SOLE
VOTING POWER
|
8
|
SHARED
VOTING POWER
|
9
|
SOLE
DISPOSITIVE POWER
|
10
|
SHARED
DISPOSITIVE POWER
|
11
|
AGGREGATE
AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
|
12
|
CHECK
BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES
|
¨
|
13
|
PERCENT
OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
|
14
|
TYPE
OF REPORTING PERSON
|
1
|
NAME
OF REPORTING PERSON
|
2
|
CHECK
THE APPROPRIATE BOX IF A MEMBER OF A GROUP
|
(a)
x
(b)
o
|
3
|
SEC
USE ONLY
|
4
|
SOURCE
OF FUNDS
|
5
|
CHECK
BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d)
OR 2(e)
|
¨
|
6
|
CITIZENSHIP
OR PLACE OF ORGANIZATION
|
NUMBER
OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
|
7
|
SOLE
VOTING POWER
|
8
|
SHARED
VOTING POWER
|
9
|
SOLE
DISPOSITIVE POWER
|
10
|
SHARED
DISPOSITIVE POWER
|
11
|
AGGREGATE
AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
|
12
|
CHECK
BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES
|
¨
|
13
|
PERCENT
OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
|
14
|
TYPE
OF REPORTING PERSON
|
1
|
NAME
OF REPORTING PERSON
|
2
|
CHECK
THE APPROPRIATE BOX IF A MEMBER OF A GROUP
|
(a)
x
(b)
o
|
3
|
SEC
USE ONLY
|
4
|
SOURCE
OF FUNDS
|
5
|
CHECK
BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d)
OR 2(e)
|
¨
|
6
|
CITIZENSHIP
OR PLACE OF ORGANIZATION
|
NUMBER
OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
|
7
|
SOLE
VOTING POWER
|
8
|
SHARED
VOTING POWER
|
9
|
SOLE
DISPOSITIVE POWER
|
10
|
SHARED
DISPOSITIVE POWER
|
11
|
AGGREGATE
AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
|
12
|
CHECK
BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES
|
¨
|
13
|
PERCENT
OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
|
14
|
TYPE
OF REPORTING PERSON
|
1
|
NAME
OF REPORTING PERSON
|
2
|
CHECK
THE APPROPRIATE BOX IF A MEMBER OF A GROUP
|
(a)
x
(b)
o
|
3
|
SEC
USE ONLY
|
4
|
SOURCE
OF FUNDS
|
5
|
CHECK
BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d)
OR 2(e)
|
¨
|
6
|
CITIZENSHIP
OR PLACE OF ORGANIZATION
|
NUMBER
OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
|
7
|
SOLE
VOTING POWER
|
8
|
SHARED
VOTING POWER
|
9
|
SOLE
DISPOSITIVE POWER
|
10
|
SHARED
DISPOSITIVE POWER
|
11
|
AGGREGATE
AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
|
12
|
CHECK
BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN
SHARES
|
¨
|
13
|
PERCENT
OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
|
14
|
TYPE
OF REPORTING PERSON
|
The following constitutes Amendment No.
2 (“Amendment No. 2”) to the Schedule 13D filed by the
undersigned. This Amendment No. 2 amends the Schedule 13D as
specifically set forth.
Item
2.
Identity and
Background
.
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”), 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 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 hereto 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 of the date
hereof.
The principal business address of
Hallmark, AHIC and HSIC is 777 Main Street, Suite 1000, Fort Worth, TX
76102. The principal business address of Mr. Peters is 3657 Briarpark
Drive, Houston, TX 77042. 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 Mr. Peters is serving as
the President and Chief Executive Officer of Remote Knowledge, Inc., a provider
of satellite-based high speed broadband equipment and services to the maritime
industry. 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 insurance executive.
Item
2(d) During the last five years, none of the Reporting
Persons or the persons listed in Schedule A annexed hereto 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 annexed hereto 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. Peters, Pape
and Fishman are citizens of the United States.
Item
4.
Purpose of
Transaction.
Item 4 is hereby amended to add the
following:
On
January 14, 2009, Hallmark delivered a letter to the Company nominating C.
Gregory Peters, Mark E. Pape and Robert M. Fishman (collectively, the
“Nominees”), as set forth therein, for election to the Company’s Board of
Directors at the Company’s 2009 annual meeting of stockholders, or any other
meeting of stockholders held in lieu thereof, and any adjournments,
postponements, reschedulings or continuations thereof (the “Annual
Meeting”). A copy of the letter is attached hereto as Exhibit 99.1
and is incorporated herein by reference.
Item
5.
Interest in Securities of
the Issuer.
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 as reported in the Company’s
Form 10-Q for the quarter ended September 30, 2008 as filed with the Securities
and Exchange Commission on November 7, 2008.
As of the
filing date of this Amendment No. 2, 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. 2, 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. 2, 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.
Messrs.
Peters, Pape and Fishman do not currently own any Shares
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 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.
Contracts, Arrangements,
Understandings or Relationships With Respect to Securities of the
Issuer
.
Item 6 is
hereby amended to add the following:
On
January 12, 2009, the Reporting Persons 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. A copy of the Joint
Filing and Solicitation Agreement is attached hereto as Exhibit 99.2 and is
incorporated herein by reference.
Pursuant
to individual letter agreements, Hallmark has agreed to indemnify Messrs.
Peters, Pape and Fishman against claims arising from the Solicitation and any
related transactions. The form of indemnification letter agreement is
attached hereto as Exhibit 99.3 and is incorporated herein by
reference.
Item
7.
Materials to be Filed as
Exhibits
.
Item 7 is hereby amended to add the
following exhibits:
|
99.1
|
Letter
from Hallmark Financial Services, Inc. to Specialty Underwriters’ Alliance
Inc., dated January 13, 2009, nominating
directors.
|
|
99.2
|
Joint
Filing and Solicitation Agreement by and among Hallmark Financial
Services, Inc., American Hallmark Insurance Company of Texas, Hallmark
Specialty Insurance Company, C. Gregory Peters, Mark E. Pape and Robert M.
Fishman, dated January 12, 2009.
|
|
99.3
|
Form
of Indemnification Letter
Agreement.
|
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:
January 15, 2009
|
Hallmark
Financial Services, Inc.
|
|
|
|
By:
|
/s/
Mark
E. Schwarz
|
|
Name:
|
Mark
E. Schwarz
|
|
Title:
|
Executive
Chairman
|
|
American
Hallmark Insurance Company of Texas
|
|
|
|
By:
|
/s/
Mark
E. Schwarz
|
|
Name:
|
Mark
E. Schwarz
|
|
Title:
|
Director
|
|
Hallmark
Specialty Insurance Company
|
|
|
|
By:
|
/s/
Mark
E. Schwarz
|
|
Name:
|
Mark
E. Schwarz
|
|
Title:
|
Director
|
|
|
|
By:
|
/s/
C.
Gregory Peters
|
|
Name:
|
C.
Gregory Peters
|
|
|
|
By:
|
/s/
Mark
E. Pape
|
|
Name:
|
Mark
E. Pape
|
|
|
|
By:
|
/s/
Robert
M. Fishman
|
|
Name:
|
Robert
M. Fishman
|
SCHEDULE
A
Directors and Executive
Officers of Hallmark Financial Services, Inc.
Name and Position
|
|
Present Principal
Occupation
|
|
Business Address
|
Mark
E. Schwarz,
Director
& Executive Chairman
|
|
Insurance
Company Executive (Hallmark Financial Services) and Principal, Newcastle
Capital Management, L.P., a private investment management
firm
|
|
Newcastle
Capital Management, L.P.
200
Crescent Ct., Ste. 1400
Dallas,
TX 75201
|
Scott
T. Berlin,
Director
|
|
Managing
Director,
Brown
Gibbons Lang & Company, LLC, an investment banking firm serving middle
market companies
|
|
Brown
Gibbons Lang & Company, LLC
1111
Superior Ave.,
Ste.
900
Cleveland,
OH 44114
|
George
R. Manser,
Director
|
|
Retired
Insurance Company Executive
|
|
707
S. Gulfstream Ave., #1102
Sarasota,
FL 34236
|
James
H. Graves,
Director
|
|
Partner,
Erwin, Graves & Associates, L.P., a management consulting
firm
|
|
Erwin,
Graves & Associates, L.P.
8201
Preston Rd, Suite 200
Dallas,
TX 75225
|
Mark
J. Morrison,
President
& CEO
|
|
Insurance
Company Executive
|
|
Hallmark
Financial Services, Inc.
777
Main St., Ste. 1000
Ft.
Worth, TX 76102
|
Jeffrey
R. Passmore,
Senior
Vice President and Chief Accounting Officer
|
|
Insurance
Company Executive
|
|
Hallmark
Financial Services, Inc.
777
Main St., Ste. 1000
Ft.
Worth, TX 76102
|
Kevin
T. Kasitz,
Executive
Vice President and Chief Operating Officer
|
|
Insurance
Company Executive
|
|
Hallmark
Financial Services, Inc.
777
Main St., Ste. 1000
Ft.
Worth, TX 76102
|
Brookland
F. Davis,
Executive
Vice President
|
|
Insurance
Company Executive
|
|
Hallmark
Financial Services, Inc.
777
Main St., Ste. 1000
Ft.
Worth, TX 76102
|
Donald
E. Meyer,
President
of Operating Unit
|
|
Insurance
Company Executive
|
|
Hallmark
Financial Services, Inc.
777
Main St., Ste. 1000
Ft.
Worth, TX 76102
|
Chris
Jones
President
of Operating Unit
|
|
Insurance
Company Executive
|
|
Hallmark
Financial Services, Inc.
777
Main St., Ste. 1000
Ft.
Worth, TX 76102
|
Directors and Executive
Officers of American Hallmark Insurance Company of Texas
Name and Position
|
|
Present Principal
Occupation
|
|
Business Address
|
Mark
E. Schwarz,
Director
|
|
Insurance
Company Executive (Hallmark Financial Services) and Principal, Newcastle
Capital Management, L.P., a private investment management
firm
|
|
Newcastle
Capital Management, L.P.
200
Crescent Ct., Ste. 1400
Dallas,
TX 75201
|
Mark
J. Morrison,
Director
& Executive Vice President
|
|
Insurance
Company Executive
|
|
Hallmark
Financial Services, Inc.
777
Main St., Ste. 1000
Ft.
Worth, TX 76102
|
Brookland
F. Davis,
Director
|
|
Insurance
Company Executive
|
|
Hallmark
Financial Services, Inc.
777
Main St., Ste. 1000
Ft.
Worth, TX 76102
|
Kevin
T. Kasitz,
Director
& President
|
|
Insurance
Company Executive
|
|
Hallmark
Financial Services, Inc.
777
Main St., Ste. 1000
Ft.
Worth, TX 76102
|
Jeffrey
R. Passmore,
Director,
CFO & Treasurer
|
|
Insurance
Company Executive
|
|
Hallmark
Financial Services, Inc.
777
Main St., Ste. 1000
Ft.
Worth, TX 76102
|
Cecil
R. Wise,
Director
& Secretary
|
|
Insurance
Company Executive
|
|
Hallmark
Financial Services, Inc.
777
Main St., Ste. 1000
Ft.
Worth, TX 76102
|
Christopher
J. Kenney,
Director
& Vice President
|
|
Insurance
Company Executive
|
|
Hallmark
Financial Services, Inc.
777
Main St., Ste. 1000
Ft.
Worth, TX 76102
|
Directors and Executive
Officers of Hallmark Specialty Insurance Company
Name and Position
|
|
Present Principal
Occupation
|
|
Business Address
|
Mark
E. Schwarz,
Director
|
|
Insurance
Company Executive (Hallmark Financial Services) and Principal, Newcastle
Capital Management, L.P., a private investment management
firm
|
|
Newcastle
Capital Management, L.P.
200
Crescent Ct., Ste. 1400
Dallas,
TX 75201
|
Mark
J. Morrison,
Director
& Vice President
|
|
Insurance
Company Executive
|
|
Hallmark
Financial Services, Inc.
777
Main St., Ste. 1000
Ft.
Worth, TX 76102
|
Donald
E. Meyer,
Director
& President
|
|
Insurance
Company Executive
|
|
TGA
Insurance Managers, Inc.
7411
John Smith Dr.,
Ste.
1400
San
Antonio, TX 78229
|
Jeffrey
R. Passmore,
Director
& Chief Financial Officer
|
|
Insurance
Company Executive
|
|
Hallmark
Financial Services, Inc.
777
Main St., Ste. 1000
Ft.
Worth, TX 76102
|
Kevin
T. Kasitz,
Director
& Vice President
|
|
Insurance
Company Executive
|
|
Hallmark
Financial Services, Inc.
777
Main St., Ste. 1000
Ft.
Worth, TX 76102
|
Marcelo
A. Borrego,
Treasurer
|
|
Insurance
Company Executive
|
|
TGA
Insurance Managers, Inc.
7411
John Smith Dr.
Ste.
1400
San
Antonio, TX 78229
|
Cecil
R. Wise,
Secretary
|
|
Insurance
Company Executive
|
|
Hallmark
Financial Services, Inc.
777
Main St., Ste. 1000
Ft.
Worth, TX 76102
|
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