OLSHAN
OLSHAN GRUNDMAN FROME ROSENZWEIG & WOLOSKY LLP
PARK AVENUE TOWER
65 EAST 55TH STREET
NEW YORK, NEW YORK 10022
TELEPHONE: 212.451.2300
October 3, 2005 FACSIMILE: 212.451.2222
WWW.OLSHANLAW.COM
DIRECT DIAL: 212-451-2333
EMAIL: SWOLOSKY@OLSHANLAW.COM
October 3, 2005
BY FEDERAL EXPRESS
Securities and Exchange Commission
Division of Corporation Finance
100 F Street, N.E.
Washington, D.C. 20549
Attn: Abby Adams
Re: VESTA INSURANCE GROUP, INC. (THE "COMPANY")
REVISED PRELIMINARY SCHEDULE 14A FILED ON SEPTEMBER 20, 2005
FILED BY NEWCASTLE PARTNERS, L.P., NEWCASTLE CAPITAL MANAGEMENT,
L.P., NEWCASTLE CAPITAL GROUP, L.L.C., MARK E. SCHWARZ,
JAMES C. EPSTEIN, MARK J. MORRISON AND STEVEN J. PULLY
(THE "NEWCASTLE GROUP")
Dear Ms. Adams:
We acknowledge receipt of the letter of comment dated September 26,
2005 from the Staff (the "Comment Letter") with regard to the above-referenced
matter. We have reviewed the Comment Letter with the Newcastle Group and provide
the following supplemental response on its behalf. Unless otherwise indicated,
the page references below are to the marked version of the enclosed paper copy
of the Preliminary Schedule 14A filed on the date hereof. Capitalized terms used
herein and not separately defined have the meanings given to them in the
Preliminary Schedule 14A. Our responses are numbered to correspond to your
comments.
PROPOSAL NO. 1 - ELECTION OF DIRECTORS
1. The Staff has asked the Newcastle Group to provide a copy of the
Schedule 13D amendment showing the beneficial ownership of shares of
each member of the Newcastle Group.
See enclosed Exhibit 1, Amendment No. 3 to Schedule 13D filed with the
Securities and Exchange Commission on September 30, 2005.
PROPOSAL NO. 2 - REIMBURSEMENT OF PROXY SOLICITATION EXPENSES OF NEWCASTLE PARTNERS
2. The disclosure has been revised as requested throughout the document.
Specifically, see pages 1 and 12 of the Proxy Statement.
LEGAL PROCEEDINGS - PAGE 19
3. The disclosure has been revised as requested. See page 19 of Proxy
Statement.
NEW JERSEY OFFICE
2001 ROUTE 46 / SUITE 202
PARSIPPANY, NEW JERSEY 07054
TELEPHONE: 973.335.7400
FACSIMILE: 973.335.8018
October 3, 2005
Page 2
4. We have reviewed the disclosure of the legal proceedings in Florida
and while Newcastle Partners, L.P. believes that it will be successful
with respect to the outcome of the Florida proceedings, we have
deleted any reference to the beliefs of Newcastle Partners, L.P.
Copies of all complaints, answers and other material pleadings in this
action are included as Exhibit 4.
The Staff is invited to contact the undersigned with any comments or
questions it may have. We would appreciate your prompt advice as to whether the
Staff has any further comments.
Very truly yours,
/s/ Steven Wolosky
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Steven Wolosky
Enclosures
cc: Mark E. Schwarz
