UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): March 5, 2005
HALLMARK FINANCIAL SERVICES, INC.
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(Exact Name of Registrant as Specified in Its Charter)
Nevada
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(State or Other Jurisdiction of Incorporation)
0-16090 87-0447375
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(Commission File Number) (IRS Employer Identification No.)
777 Main Street, Suite 1000, Fort Worth, Texas 76102
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(Address of Principal Executive Offices) (Zip Code)
817-348-1600
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(Registrant's Telephone Number, Including Area Code)
Not Applicable
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(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of
the following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange
Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under
the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under
the Exchange Act (17 CFR 240.13e-4(c))
Item 1.01 Entry into a Material Definitive Agreement
On March 5, 2005, the Compensation Committee of the Board of Directors
of Hallmark Financial Services, Inc. (the "Company") approved a bonus of
$150,000 for each of the following three executive officers of the Company
for services performed during 2004:
Name Title
---- -----
Mark J. Morrison Executive Vice President, Chief Financial Officer
Brookland F. Davis President of Personal Lines Group
Kevin T. Kasitz President of Commercial Lines Group
The bonuses were awarded, in part, on the basis of the Company having
achieved the maximum level of 2004 consolidated pre-tax income from
recurring operations previously established by the Compensation Committee.
The bonus awards were also based on an assessment of individual job
performance.
The Compensation Committee also approved the payment of 75% of each
bonus award in cash during March, 2005. The Compensation Committee further
approved the payment of the remaining 25% of each bonus award, at the
discretion of a majority of the recipients, either (a) in restricted shares
of the common stock of the Company based on the closing price of such stock
on the American Stock Exchange Emerging Company Marketplace as of March 4,
2005, or (b) in two equal annual installments payable, without interest, on
the first and second anniversaries of the 2005 cash payment. In the event
the recipients elect to receive restricted shares, such shares will vest in
two equal installments on the first and second anniversaries of the 2005
cash payment. Vesting of any restricted securities and receipt of any
deferred cash is conditioned upon the executive's continued employment with
the Company.
SIGNATURES
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 duly authorized.
HALLMARK FINANCIAL SERVICES, INC.
Date: March 9, 2005 By: /s/ Mark J. Morrison
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Mark J. Morrison, Chief Financial Officer