Sec Form 4 Filing - SCHWARZ MARK E @ HALLMARK FINANCIAL SERVICES INC - 2019-03-07

FORM 4 Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934, Section 17(a) of the Public Utility Holding Company Act of 1935 or Section 30(h) of the Investment Company Act of 1940

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1. Name and Address of Reporting Person SCHWARZ MARK E 2. Issuer Name and Ticker or Trading Symbol HALLMARK FINANCIAL SERVICES INC [ HALL] 5. Relationship of Reporting Person(s) to Issuer (Check all applicable) X __ Director X __ 10% Owner X __ Officer (give title below) _____ Other (specify below) Executive Chairman (Last) (First) (Middle) 200 CRESCENT COURT, SUITE 1400 3. Date of Earliest Transaction (MM/DD/YY) 03/07/2019 (Street) DALLAS, TX75201 4. If Amendment, Date Original Filed (MM/DD/YY) 6. Individual or Joint/Group Filing (Check Applicable Line) _____ Form filed by One Reporting Person __ X __ Form filed by More than One Reporting Person (City) (State) (Zip)

Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned 1.Title of Security (Instr. 3) 2. Transaction Date (MM/DD/YY) 2A. Deemed Execution Date, if any (MM/DD/YY) 3. Transaction Code (Instr. 8) 4. Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5) 5. Amount of Securities Beneficially Owned Following Reported Transaction(s) (Instr. 3 and 4) 6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4) 7. Nature of Indirect Beneficial Ownership (Instr. 4) Code V Amount (A) or (D) Price Common Stock 03/07/2019 F 128,225 D $ 10.31 2,580 D ( 1 ) Common Stock 03/07/2019 M 200,000 A $ 6.61 202,580 D ( 1 ) Common Stock 949,702 I Shares directly owned by NCM Services, Inc. ( 2 ) Common Stock 172,776 I Shares directly owned by Newcastle Capital Management, L.P. ( 2 ) Common Stock 3,730,432 I Shares directly owned by Newcastle Partners, L.P. ( 2 )

Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned ( e.g. , puts, calls, warrants, options, convertible securities) 1. Title of Derivative Security (Instr. 3) 2. Conversion or Exercise Price of Derivative Security 3. Transaction Date (MM/DD/YY) 3A. Deemed Execution Date, if any (MM/DD/YY) 4. Transaction Code (Instr. 8) 5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4, and 5) 6. Date Exercisable and Expiration Date (MM/DD/YY) 7. Title and Amount of Underlying Securities (Instr. 3 and 4) 8. Price of Derivative Security (Instr. 5) 9. Number of Derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4) 10. Ownership Form of Derivative Security: Direct (D) or Indirect (I) (Instr. 4) 11. Nature of Indirect Beneficial Ownership (Instr. 4) Code V (A) (D) Date Exercisable Expiration Date Title Amount or Number of Shares Director Stock Option (right to buy) $ 6.61 03/07/2019 M 200,000 ( 3 ) 04/01/2019 Common Stock 200,000 $ 0 ( 3 ) 0 D ( 1 ) Director Stock Option (right to buy) $ 6.99 07/01/2012 12/31/2021 Common Stock 14,157 14,157 D ( 1 )

Reporting Owners Reporting Owner Name / Address Relationships Director 10% Owner Officer Other SCHWARZ MARK E 200 CRESCENT COURT SUITE 1400 DALLAS, TX75201 X X Executive Chairman Schwarz 2012 Family Trust 200 CRESCENT COURT SUITE 1400 DALLAS, TX75201 X NCM SERVICES, INC. 200 CRESCENT COURT SUITE 1400 DALLAS, TX75201 X NEWCASTLE CAPITAL GROUP LLC 200 CRESCENT COURT SUITE 1400 DALLAS, TX75201 X NEWCASTLE CAPITAL MANAGEMENT LP 200 CRESCENT COURT SUITE 1400 DALLAS, TX75201 X NEWCASTLE PARTNERS L P 200 CRESCENT COURT SUITE 1400 DALLAS, TX75201 X Signatures Steven D. Davidson, as Attorney-In-Fact for all Reporting Persons 03/11/2019 Signature of Reporting Person Date

Explanation of Responses:

( 1 )Direct ownership by Mr. Schwarz. ( 2 )Mr. Schwarz is the sole trustee of the Schwarz 2012 Family Trust (the "Trust") and a director and officer of NCM Services, Inc. ("NCMS"). The Trust is the sole shareholder of NCMS, which is the sole member of Newcastle Capital Group, L.L.C. ("NCG"), which is the general partner of Newcastle Capital Management, L.P. ("NCM"), which is the general partner of Newcastle Partners, L.P. ("NP"). Accordingly, Mr. Schwarz may be deemed the beneficial owner of all shares held by any of the Trust, NCMS, NCG, NCM or NP, and each of these entities may be deemed the beneficial owner of all shares held by the entities which they directly or indirectly own or control. ( 3 )Represents director stock options which vest in seven equal annual installments commencing April 1, 2010.

Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.

* If the form is filed by more than one reporting person, see Instruction 4(b)(v).

** Intentional misstatements or omissions of facts constitute Federal Criminal Violations. See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).

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