Hallmark nominees to Specialty board backed by proxy advisory firm

By Lisa Kerner

Charlotte, N.C., April 27 - Specialty Underwriters' Alliance, Inc. urged its shareholders to re-elect the company's board of directors at the annual meeting on May 5.

In an open letter to shareholders on Monday, Specialty said its board "always has and always will work toward creating stockholder value including pursuing strategic alternatives if they make sense for all stockholders."

Also on Monday, Hallmark Financial Services, Inc. announced that RiskMetrics Group/ISS recommended that Specialty shareholders vote for Hallmark's slate at the annual meeting.

Hallmark's nominees are Robert M. Fishman, Mark E. Pape and C. Gregory Peters.

Fishman is the former managing director of Southwest Insurance Partners, Inc. Pape is the former executive vice president and chief financial officer at Affirmative Insurance Holdings, Inc. Peters is the former senior vice president, equity research at Raymond James & Associates.

RiskMetrics, according to Hallmark, concluded that the presence of the three dissident nominees on Specialty's board "would likely prove beneficial" to the company's shareholder value.

"The report also notes that the long-term financial performance of SUAI [Specialty] and the dissidents' relevant industry experience establish both the need for change and the dissidents' ability to effect change," Hallmark said.

Hallmark denied it is seeking control of Specialty's board, noting that it only wants a minority of three out of seven board seats.

Specialty said two additional proxy advisory firms, Glass, Lewis & Co., LLC and Proxy Governance, Inc., recommended in favor of Specialty's current slate of directors.

According to Hallmark, a Fort Worth property and casualty insurer, Specialty amended its bylaws in August 2008, eliminating stockholders' rights to fill vacancies on the board and to call special meetings.

Specialty is a Chicago commercial insurance provider.

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