Fort Worth-based Hallmark Financial Services Inc. (www.hallmarkgrp.com) reported that it has completed a previously announced rights offering. Stockholders exercised subscription rights to purchase the entire 25 million shares offered at a subscription price of $0.40 per share, raising gross proceeds of $10.0 million.
Hallmark’s primary business activities include the marketing, underwriting and premium financing of non-standard personal automobile insurance primarily in Texas, Arizona and New Mexico, as well as marketing commercial insurance in Texas, New Mexico, Idaho, Oregon and Washington.
There were 18.0 million shares purchased through the exercise of basic subscription rights and an additional 7.0 million shares purchased through the over subscription privilege. The proceeds from the rights offering will be used to repay the bridge loan to Newcastle Partners L.P. and for general corporate purposes.
In aggregate, Hallmark received cash commitments for $13.5 million totaling 33.7 million shares. Hallmark has accepted all validly exercised subscription rights limited to the $10 million offering size. Hallmark’s transfer agent is in the process of distributing stock certificates to stockholders exercising their subscription rights.
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