Nomination & Governance Committee Charter

Nomination & Governance Committee Charter

Nomination and Governance Committee Charter
ANNEX A

HALLMARK FINANCIAL SERVICES, INC. 
NOMINATION AND GOVERNANCE COMMITTEE CHARTER
August 6, 2006

The Board of Directors (the “Board”) of Hallmark Financial Services, Inc. (the “Company”) has adopted the following Nomination and Governance Committee Charter for the governance of the Nomination and Governance Committee (the “Committee”) of the Board.

Purposes:

The purposes of the Nomination and Governance Committee are to recommend candidates for election to the Board and to oversee, review and make periodic recommendations concerning the Company’s corporate governance policies.

Membership:

The Nomination and Governance Committee shall be comprised of three or more directors, as determined by the Board. Committee members shall be appointed by the Board and may be removed by the Board, in its discretion. The Committee shall be composed entirely of directors who satisfy the definition of “independent” under the listing standards of The Nasdaq Stock Market (“Nasdaq”). The Board shall annually review and determine the independence of each member of the Committee.

Structure and Meetings:

The Board shall appoint one member of the Nomination and Governance Committee as chairperson. The chairperson shall be responsible for leadership of the Committee and reporting to the Board. The Committee shall meet as many times per year as the members deem necessary. A majority of the total number of members of the Committee shall constitute a quorum at all Committee meetings and shall be required for approval of any action by the Committee.

Committee Authority and Responsibilities:

The Nomination and Governance Committee shall have the authority to take all actions it deems advisable to fulfill its responsibilities and duties. The Committee shall have the authority to retain, at the Company’s expense and on such terms as the Committee deems necessary or advisable, search firms or professional advisors (including, without limitation, legal counsel, which may be the same as the Company’s primary legal counsel) to advise the Committee in connection with the exercise of its powers and responsibilities as set forth in this Charter. The Company shall provide for appropriate funding, as determined by the Committee, for payment of compensation any such search firm or legal counsel.

In carrying out its purposes, the Nomination and Governance Committee shall:

  • Review from time to time the size and composition of the Board and make recommendations to the Board regarding proposed changes.
  • Review from time to time the appropriate skills and characteristics required of Board nominees in the context of the current composition of the Board, including such factors as educational achievement, managerial experience, business acumen, financial sophistication, insurance industry expertise and strategic planning and policy-making skills.
  • Identify and evaluate candidates for Board service.
  • Recommend to the Board director nominees for election at our annual meetings of stockholders or for appointment to fill vacancies.
  • Recommend to the Board the size, composition and membership of each Board committee.
  • Periodically review the Company’s corporate governance policies and make recommendations to the Board regarding proposed changes.
  • Review as necessary and make recommendations to the Board regarding stockholder proposals.
  • Perform any other activities as the Board shall from time to time assign to the Committee.

Review of Committee Charter:

The Nomination and Governance Committee shall periodically review the adequacy of this Charter. The Committee shall report the results of such review to the Board and, if necessary, make recommendations to the Board to amend this Charter.