sec document
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
--------------
SCHEDULE 13D
(RULE 13d-101)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT
TO RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO
RULE 13d-2(a)
(Amendment No. 2)(1)
Vesta Insurance Group, Inc.
---------------------------
(Name of Issuer)
Common Stock, $.01 Par Value
----------------------------
(Title of Class of Securities)
925391104
---------
(CUSIP Number)
STEVEN WOLOSKY, ESQ.
OLSHAN GRUNDMAN FROME ROSENZWEIG & WOLOSKY LLP
Park Avenue Tower
65 East 55th Street
New York, New York 10022
(212) 451-2300
--------------
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
July 8, 2005
------------
(Date of Event Which Requires Filing of This Statement)
If the filing person has previously filed a statement on Schedule 13G
to report the acquisition that is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the
following box |_|.
NOTE. Schedules filed in paper format shall include a signed original
and five copies of the schedule, including all exhibits. See Rule 13d-7 for
other parties to whom copies are to be sent.
(Continued on following pages)
(Page 1 of 21 Pages)
--------
1 The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which would
alter disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities Exchange
Act of 1934 or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
NOTES).
----------------------- --------------------
CUSIP No. 925391104 13D Page 2 of 21 Pages
----------------------- --------------------
================================================================================
1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
NEWCASTLE PARTNERS, L.P.
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |X|
(b) |_|
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
WC
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e) |_|
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
TEXAS
--------------------------------------------------------------------------------
7 SOLE VOTING POWER
3,050,700
-----------------------------------------------------------------
NUMBER OF 8 SHARED VOTING POWER
SHARES
BENEFICIALLY - 0 -
OWNED BY -----------------------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON 3,050,700
WITH -----------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
- 0 -
--------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
3,050,700
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_|
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
8.5%
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
PN
--------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
----------------------- --------------------
CUSIP No. 925391104 13D Page 3 of 21 Pages
----------------------- --------------------
================================================================================
1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
NEWCASTLE CAPITAL MANAGEMENT, L.P.
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |X|
(b) |_|
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
OO
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e) |_|
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
TEXAS
--------------------------------------------------------------------------------
7 SOLE VOTING POWER
3,050,700
-----------------------------------------------------------------
NUMBER OF 8 SHARED VOTING POWER
SHARES
BENEFICIALLY - 0 -
OWNED BY -----------------------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON 3,050,700
WITH -----------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
- 0 -
--------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
3,050,700
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_|
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
8.5%
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
PN
--------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
----------------------- --------------------
CUSIP No. 925391104 13D Page 4 of 21 Pages
----------------------- --------------------
================================================================================
1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
NEWCASTLE CAPITAL GROUP, L.L.C.
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |X|
(b) |_|
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
OO
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e) |_|
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
TEXAS
--------------------------------------------------------------------------------
7 SOLE VOTING POWER
3,050,700
-----------------------------------------------------------------
NUMBER OF 8 SHARED VOTING POWER
SHARES
BENEFICIALLY - 0 -
OWNED BY -----------------------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON 3,050,700
WITH -----------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
- 0 -
--------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
3,050,700
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_|
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
8.5%
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
OO
--------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
----------------------- --------------------
CUSIP No. 925391104 13D Page 5 of 21 Pages
----------------------- --------------------
================================================================================
1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
MARK E. SCHWARZ
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |X|
(b) |_|
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
OO
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e) |_|
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
USA
--------------------------------------------------------------------------------
7 SOLE VOTING POWER
3,050,700
-----------------------------------------------------------------
NUMBER OF 8 SHARED VOTING POWER
SHARES
BENEFICIALLY - 0 -
OWNED BY -----------------------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON 3,050,700
WITH -----------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
- 0 -
--------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
3,050,700
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_|
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
8.5%
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
--------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
----------------------- --------------------
CUSIP No. 925391104 13D Page 6 of 21 Pages
----------------------- --------------------
================================================================================
1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
JAMES C. EPSTEIN
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |X|
(b) |_|
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e) |_|
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
USA
--------------------------------------------------------------------------------
7 SOLE VOTING POWER
- 0 -
-----------------------------------------------------------------
NUMBER OF 8 SHARED VOTING POWER
SHARES
BENEFICIALLY - 0 -
OWNED BY -----------------------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON - 0 -
WITH -----------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
- 0 -
--------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
- 0 -
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_|
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0%
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
--------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
----------------------- --------------------
CUSIP No. 925391104 13D Page 7 of 21 Pages
----------------------- --------------------
================================================================================
1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
MARK J. MORRISON
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |X|
(b) |_|
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e) |_|
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
USA
--------------------------------------------------------------------------------
7 SOLE VOTING POWER
- 0 -
-----------------------------------------------------------------
NUMBER OF 8 SHARED VOTING POWER
SHARES
BENEFICIALLY - 0 -
OWNED BY -----------------------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON - 0 -
WITH -----------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
- 0 -
--------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
- 0 -
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_|
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0%
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
--------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
----------------------- --------------------
CUSIP No. 925391104 13D Page 8 of 21 Pages
----------------------- --------------------
================================================================================
1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
STEVEN J. PULLY
--------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) |X|
(b) |_|
--------------------------------------------------------------------------------
3 SEC USE ONLY
--------------------------------------------------------------------------------
4 SOURCE OF FUNDS*
--------------------------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e) |_|
--------------------------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
USA
--------------------------------------------------------------------------------
7 SOLE VOTING POWER
- 0 -
-----------------------------------------------------------------
NUMBER OF 8 SHARED VOTING POWER
SHARES
BENEFICIALLY - 0 -
OWNED BY -----------------------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING
PERSON - 0 -
WITH -----------------------------------------------------------------
10 SHARED DISPOSITIVE POWER
- 0 -
--------------------------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
- 0 -
--------------------------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |_|
--------------------------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0%
--------------------------------------------------------------------------------
14 TYPE OF REPORTING PERSON*
IN
--------------------------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT!
----------------------- --------------------
CUSIP No. 925391104 13D Page 9 of 21 Pages
----------------------- --------------------
The following constitutes Amendment No. 2 ("Amendment No. 2") to the
Schedule 13D filed by the undersigned. This Amendment No. 2 amends the Schedule
13D as specifically set forth.
Item 3 is hereby amended and restated to read as follows:
Item 3. Source and Amount of Funds or Other Consideration.
-------------------------------------------------
As of July 8, 2005, NP had invested $9,247,932 (inclusive of
brokerage commissions) in shares of Common Stock of the Issuer. The source of
these funds was the working capital of NP.
Item 4 is hereby amended to add the following:
On July 8, 2005, NP delivered a letter to the Issuer requesting,
pursuant to Section 220 of the Delaware General Corporation Law, a complete list
of the Issuer's stockholders and other corporate records in order to allow the
Reporting Persons to communicate with the Issuer's stockholders in connection
with the failure of the Issuer to hold an annual meeting of stockholders within
thirteen months after the last annual meeting and the election of directors at
the annual meeting of stockholders and any other matters as may properly come
before the annual meeting of stockholders. A copy of this letter is attached
hereto as Exhibit 3 and is incorporated herein by reference.
On July 8, 2005, NP filed a complaint with the Delaware Court of
Chancery to enforce its rights as a stockholder of the Issuer, pursuant to
Section 211 of the Delaware General Corporation Law, to compel the Issuer to
hold an annual meeting of stockholders for the purpose of electing directors.
Item 5(a) is hereby amended and restated to read as follows:
(a) The aggregate percentage of shares of Common Stock reported
to be owned by the Reporting Persons is based upon 36,079,564 shares
outstanding, which is the total number of shares outstanding as reported in the
Issuer's Quarterly Report on Form 10-Q for the quarter ended June 30, 2004, as
filed with the Securities and Exchange Commission on August 9, 2004.
As of July 8, 2005, NP beneficially owned 3,050,700 shares of
Common Stock, representing approximately 8.5% of the issued and outstanding
Common Stock of the Issuer.
NCM, as the general partner of NP, may also be deemed to
beneficially own the 3,050,700 shares of Common Stock beneficially owned by NP.
NCG, as the general partner of NCM, which in turn is the general
partner of NP, may also be deemed to beneficially own the 3,050,700 shares of
Common Stock beneficially owned by NP.
----------------------- --------------------
CUSIP No. 925391104 13D Page 10 of 21 Pages
----------------------- --------------------
Mark E. Schwarz, as the managing member of NCG, the general
partner of NCM, which in turn is the general partner of NP, may also be deemed
to beneficially own the 3,050,700 shares of Common Stock beneficially owned by
NP.
NCM, NCG and Mr. Schwarz disclaim beneficial ownership of the
shares of Common Stock held by NP, except to the extent of their pecuniary
interest therein.
Messrs. Epstein, Morrison and Pully do not beneficially own any
shares of Common Stock.
Item 5(c) is hereby amended to add the following:
(c) Schedule A annexed hereto lists all transactions in the
Common Stock by the Reporting Persons since the filing of Amendment No. 1 to
Schedule 13D. All of such transactions were effected in the open market.
Item 7 is hereby amended to add the following exhibits:
3. Letter from Newcastle Partners, L.P. to the Corporate
Secretary of Vesta Insurance Group, Inc., dated July 8,
2005, requesting a stockholders list and other corporate
records.
4. Complaint filed on July 8, 2005 with the Delaware Court of
Chancery.
----------------------- --------------------
CUSIP No. 925391104 13D Page 11 of 21 Pages
----------------------- --------------------
SIGNATURES
After reasonable inquiry and to the best of his knowledge and
belief, each of the undersigned certifies that the information set forth in this
Statement is true, complete and correct.
Dated: July 8, 2005 NEWCASTLE PARTNERS, L.P.
By: Newcastle Capital Management, L.P.,
its General Partner
By: Newcastle Capital Group, L.L.C.,
its General Partner
By: /s/ Mark E. Schwarz
---------------------------------------
Mark E. Schwarz, Managing Member
NEWCASTLE CAPITAL MANAGEMENT, L.P.
By: Newcastle Capital Group, L.L.C.,
its General Partner
By: /s/ Mark E. Schwarz
---------------------------------------
Mark E. Schwarz, Managing Member
NEWCASTLE CAPITAL GROUP, L.L.C.
By: /s/ Mark E. Schwarz
---------------------------------------
Mark E. Schwarz, Managing Member
/s/ Mark E. Schwarz
-------------------------------------------
MARK E. SCHWARZ
/s/ James C. Epstein
-------------------------------------------
JAMES C. EPSTEIN
/s/ Mark J. Morrison
-------------------------------------------
MARK J. MORRISON
/s/ Steven J. Pully
-------------------------------------------
STEVEN J. PULLY
----------------------- --------------------
CUSIP No. 925391104 13D Page 12 of 21 Pages
----------------------- --------------------
SCHEDULE A
Transactions in the Common Stock Since the Filing of Amendment No. 1 to Schedule 13D
------------------------------------------------------------------------------------
Shares of Common Stock Price Per Date of
Purchased Share ($) Purchase
--------- --------- --------
NEWCASTLE PARTNERS, L.P.
------------------------
17,000 2.5000 5/26/05
12,500 2.5012 5/27/05
19,100 2.5092 6/01/05
220,800 2.5151 6/02/05
6,600 2.5523 6/03/05
300 2.6000 6/08/05
NEWCASTLE CAPITAL MANAGEMENT, L.P.
----------------------------------
None
NEWCASTLE CAPITAL GROUP, L.L.C.
-------------------------------
None
MARK E. SCHWARZ
---------------
None
JAMES C. EPSTEIN
----------------
None
MARK J. MORRISON
----------------
None
STEVEN J. PULLY
---------------
None
----------------------- --------------------
CUSIP No. 925391104 13D Page 13 of 21 Pages
----------------------- --------------------
EXHIBIT INDEX
Exhibit Page
------- ----
1. Director Nomination Letter from Newcastle Partners, L.P.
to Vesta Insurance Group, Inc., dated March 21, 2005
(previously filed). --
2. Joint Filing and Solicitation Agreement, dated March 21,
2005 (previously filed). --
3. Letter from Newcastle Partners, L.P. to the Corporate
Secretary of Vesta Insurance Group, Inc., dated July 8,
2005, requesting a stockholders list and other corporate
records. 14-17
4. Complaint filed on July 8, 2005 with the Delaware Court of 18-21
Chancery.
----------------------- --------------------
CUSIP No. 925391104 13D Page 14 of 21 Pages
----------------------- --------------------
NEWCASTLE PARTNERS, L.P.
300 CRESCENT COURT, SUITE 1110
DALLAS, TEXAS 75201
July 8, 2005
VIA FACSIMILE AND FEDERAL EXPRESS
---------------------------------
Vesta Insurance Group, Inc.
3760 River Run Drive
Birmingham, Alabama 35243
Attn: Corporate Secretary
Dear Sir:
Newcastle Partners, L.P. ("Newcastle"), a Texas limited partnership,
is the record owner of 1,000 shares and beneficial owner of 3,050,700 shares
(the "Shares") of common stock, $.01 par value (the "Common Stock"), of Vesta
Insurance Group, Inc., a Delaware corporation (the "Company"), as of the close
of business on July 7, 2005.
As the record and beneficial owner of the Shares as stated above,
Newcastle hereby requests, on its behalf as well as on behalf of certain other
persons who are beneficial holders of shares of Common Stock and named as
Reporting Persons in that certain Schedule 13D, as amended (the "Schedule 13D"),
filed by Newcastle, among others, on May 6, 2005 with respect to beneficial
ownership of shares of Common Stock, pursuant to Section 220 of the Delaware
General Corporation Law, during the usual hours for business, to inspect the
following books, records and documents of the Company and to make copies or
extracts therefrom:
(a) A complete record or list of the holders of the Common
Stock, certified by the Company's transfer agent(s) and/or
registrar(s), showing the name, address and number of shares
registered in the name of each such holder, as of the date hereof as
well as any record date established, or to be established, for the
2005 annual meeting of stockholders of the Company, or any other
record date that may be established for the annual meeting or any
other meeting of stockholders held in lieu thereof (any such date,
the "Determination Date") and any adjournments, postponements,
reschedulings or continuations thereof (the "Annual Meeting");
(b) A magnetic computer tape list or other electronic medium of
the holders of the Common Stock as of the Determination Date,
showing the name, address and number of shares registered in the
name of each such holder; such computer processing data as is
necessary for Newcastle to make use of such magnetic computer tape;
and a hard copy printout of such magnetic computer tape for
verification purposes;
----------------------- --------------------
CUSIP No. 925391104 13D Page 15 of 21 Pages
----------------------- --------------------
(c) A stop list or stop lists relating to shares of Common Stock
of the Company and any additions or deletions thereto. Any daily
transfer sheets after the initial Determination Date;
(d) All information in the Company's or its transfer agent's
possession, or which can reasonably be obtained from nominees of any
central certificate depository systems or their nominees, brokers,
dealers, banks, respondent banks, clearing agencies, voting trusts
and their nominees or other nominees, concerning the number,
identity of, and shares held by the actual beneficial owners of the
Common Stock as of the Determination Date, including an alphabetical
breakdown of any holdings in the respective names of Cede & Co. and
other similar depositories or nominees as well as any material
request list provided by Automatic Data Processing-Investor
Communications Services and any omnibus proxies issued by such
entities;
(e) All information in or which comes into the Company's
possession or which can reasonably be obtained from brokers,
dealers, banks, clearing agencies or voting trustees relating to the
names of the non-objecting beneficial owners of the Common Stock in
the format of a magnetic computer tape, cartridge file or other
electronic medium of such owners showing the name, address and
number of shares registered in the name of each such owner; such
computer processing data as is necessary for Newcastle to make use
of such magnetic computer tape or cartridge; and a hard copy
printout of such magnetic computer tape or cartridge for
verification purposes (such information with respect to brokers and
dealers is readily available to the Company under Rule 14b-1 of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"),
from ADP Proxy Services);
(f) All "respondent bank" lists and omnibus proxies for such
lists, pursuant to Rule 14b-2 of the Exchange Act;
(g) A list of stockholders of the Company who are participants
in any Company employee stock ownership, stock purchase, stock
option, retirement, restricted stock, incentive, profit sharing,
dividend reinvestment or any similar plan in which voting of Common
Stock under the plan is controlled, directly or indirectly,
individually or collectively, by such plan's participants, showing
(i) the name and address of each such participant, (ii) the number
of shares of Common Stock attributable to each such participant in
any such plan, and (iii) the method by which Newcastle or its agents
may communicate with each such participant, as well as the name,
firm and phone number of the trustee or administrator of such plan,
and a detailed explanation of the treatment not only of shares for
which the trustee or administrator receives instructions from
participants, but also shares for which either they do not receive
instructions or shares which are outstanding in the plan but are
unallocated to any participant; and
(h) A correct and complete copy of the bylaws of the Company.
Newcastle demands that modifications, additions or deletions to any
and all information referred to in paragraphs (a) through (h) be immediately
furnished as such modifications, additions or deletions become available to the
Company or its agents or representatives.
----------------------- --------------------
CUSIP No. 925391104 13D Page 16 of 21 Pages
----------------------- --------------------
Newcastle will bear the reasonable costs incurred by the Company
including those of its transfer agent(s) or registrar(s) in connection with the
production of the information demanded.
The purpose of this demand is to enable Newcastle, as well as
certain other persons who are beneficial holders of shares of Common Stock and
named as Reporting Persons in the Schedule 13D, to communicate with the
Company's stockholders in connection with the failure of the Company to hold an
annual meeting of stockholders within 13 months after the last annual meeting as
required by the Delaware General Corporation Law and the election of directors
at the Annual Meeting and any other matters as may properly come before the
Annual Meeting.
Newcastle hereby designates and authorizes Steven Wolosky, Adam W.
Finerman and Ron S. Berenblat of Olshan Grundman Frome Rosenzweig & Wolosky LLP,
and Dan Burch and Mark Harnett of MacKenzie Partners, Inc., and any other
persons designated by them, acting singly or in any combination, to conduct the
inspection and copying herein requested. It is requested that the information
identified above be made available to the designated parties by July 15, 2005.
Very truly yours,
NEWCASTLE PARTNERS, L.P.
By: Newcastle Capital Management, L.P.,
its General Partner
By: Newcastle Capital Group, L.L.C.,
its General Partner
By: /s/ Mark E. Schwarz
--------------------------------
Mark E. Schwarz, Managing Member
----------------------- --------------------
CUSIP No. 925391104 13D Page 17 of 21 Pages
----------------------- --------------------
State of Texas )
) ss:
County of Dallas )
Mark E. Schwarz, being sworn, states: I executed the foregoing
letter, and the information and facts stated therein regarding Newcastle
Partners, L.P.'s ownership and the purpose of this demand for inspection are
true and correct. Such inspection is reasonably related to Newcastle Partners,
L.P.'s interest as a stockholder and is not desired for a purpose which is in
the interest of a business or object other than the business of Vesta Insurance
Group, Inc.
/s/ Mark E. Schwarz
--------------------
Mark E. Schwarz
Subscribed and sworn to before me
this 8th day of July, 2005.
/s/ Allison H. Moritz
---------------------------
Notary Public
My commission expires: 11-25-06
--------
----------------------- --------------------
CUSIP No. 925391104 13D Page 18 of 21 Pages
----------------------- --------------------
IN THE COURT OF CHANCERY OF THE STATE OF DELAWARE
IN AND FOR NEW CASTLE COUNTY
NEWCASTLE PARTNERS, L.P., )
)
Plaintiff, )
)
v. ) C.A. No. ____________
)
VESTA INSURANCE GROUP, INC., )
a Delaware corporation, )
)
Defendant. )
COMPLAINT PURSUANT TO 8 DEL. C. ss. 211
---------------------------------------
Plaintiff Newcastle Partners, L.P. ("Plaintiff"), by and through its
undersigned counsel, for its complaint against defendant Vesta Insurance Group,
Inc. (the "Company"), alleges, upon knowledge as to its own actions and
otherwise upon information and belief, as follows:
NATURE OF THE ACTION
--------------------
1. Plaintiff brings this action pursuant to 8 Del. C. ss. 211 to
enforce its statutory right, as a stockholder of the Company, to compel the
Company to hold an annual meeting of stockholders for the purpose of electing
directors, which has not occurred in more than thirteen months.
PARTIES
-------
2. At all times relevant to this action, Plaintiff has been and
continues to be a stockholder of the Company.
3. The Company is a corporation organized under the laws of the
State of Delaware, with its principal place of business at 3760 River Run Drive,
Birmingham, AL 35243. The Company can be served in Delaware through its
registered agent, The Corporation Trust Company, Corporation Trust Center, 1209
Orange Street, Wilmington, DE 19801.
----------------------- --------------------
CUSIP No. 925391104 13D Page 19 of 21 Pages
----------------------- --------------------
FACTUAL BACKGROUND
------------------
4. The Company's last annual meeting for the election of directors
was held on June 1, 2004, more than 13 months prior to the filing of this
Complaint.
5. The terms of three (3) Class III directors currently serving on
the Company Board expire at the 2005 annual shareholders meeting.
6. On March 21, 2005, plaintiff delivered a letter to the Company
nominating James C. Epstein, Mark J. Morrison and Steven J. Pully, for election
to the Company's Board of Directors at the Company's 2005 annual meeting of
stockholders, or any other meeting of stockholders held in lieu thereof, and any
adjournments, postponements, reschedulings or continuations thereof.
7. The Company, as of the filing of this Complaint, has failed to
designate a date for an annual meeting of the stockholders to occur this year.
CLAIMS FOR RELIEF
COUNT I - SETTING DATE FOR ANNUAL MEETING
OF STOCKHOLDERS PURSUANT TO 8 DEL. C. ss. 211(c)
8. Plaintiff repeats and realleges the allegations of the foregoing
paragraphs as if fully set forth herein.
9. The Company has not held an annual meeting of stockholders for
the election of directors since June 1, 2004, more than thirteen months before
the filing of this Complaint.
10. No action has been taken by written consent in lieu of an annual
meeting within the last thirteen months to elect directors in accordance with 8
Del. C. ss. 211(b).
11. As of the date of the filing of this Complaint, the Company has
not designated any date for the holding of an annual meeting of stockholders.
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CUSIP No. 925391104 13D Page 20 of 21 Pages
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12. Pursuant to 8 Del. C. ss. 211(c), Plaintiff is entitled to an
order of this Court summarily directing the Company to hold promptly an annual
meeting for the election of directors and stating that the shares of stock
represented at such meeting, whether in person or by proxy, and entitled to vote
thereat, shall constitute a quorum for the purpose of such meeting. See, e.g.,
Meredith v. Security America Corp., 1981 Del. Ch. LEXIS 633, at *5-6 (Del. Ch.
Nov. 18, 1981) (noting Court's "duty" to ensure that an annual meeting take
place "as promptly as possible" and ordering meeting to take place 65 days after
the expiration of the 13 month deadline).
13. Plaintiff has no adequate remedy at law.
o o o
WHEREFORE, Plaintiff respectfully prays that the Court grant the
following relief:
A. Entry of an Order summarily ordering the Company to hold an
annual meeting for the election of directors and stating that the shares of
stock represented at such meeting, whether in person or by proxy, and entitled
to vote thereat, shall constitute a quorum for the purpose of such meeting;
B. Entry of an Order designating a time and place for the annual
meeting, setting a prompt record date for the determination of the stockholders
entitled to vote at the annual meeting, and approving the form of notice for the
annual meeting;
C. Award Plaintiff its fees and costs in pursuing this action,
including its reasonable attorneys' fees; D. Grant Plaintiff such other and
further relief as the Court deems just and proper.
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CUSIP No. 925391104 13D Page 21 of 21 Pages
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Respectfully submitted,
YOUNG CONAWAY STARGATT
& TAYLOR, LLP
/s/ Christian Douglas Wright
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OF COUNSEL: Bruce L. Silverstein (#2495)
Martin S. Lessner (#3109)
OLSHAN GRUNDMAN FROME Christian Douglas Wright (#3554)
ROSENZWEIG & WOLOSKY LLP The Brandywine Building
Steven Wolosky 1000 West Street, 17th Floor
65 East 55th Street P.O. Box 391
New York, NY 10022 Wilmington, DE 19899-0391
(212) 451-2300 (302) 571-6600
DATED: July 7, 2005 ATTORNEYS FOR PLAINTIFF