Vesta Insurance Group Inc. (fka VTAI)

[lifegear]

some news at google finance regarding payment of claims

[ge161741]

The guys sucking $37,000 a month out this?

[vonray]

Stay Away, VTAI can seriously harm your wealth

More From The Birmingham News
Creditors want Vesta exec's salary reduced
CEO drawing $37,000 a month
Wednesday, October 18, 2006
RUSSELL HUBBARD
News staff writer

Creditors of Vesta Insurance Group have asked a judge supervising the company's bankruptcy to reduce the $37,000 monthly salary of the chief executive who led the company as it plunged into insolvency.

David Lacefield, chief executive of the Birmingham-based company, has been drawing the pay with court permission since the company filed for protection from creditors in August, after it terminated employees because it couldn't pay them. This week, the creditors filed a formal objection to Lacefield's ongoing pay package in U.S. Bankruptcy Court in Birmingham.

"He provides little, if any, benefit to the debtor's estate," said the creditor court filing. "There should be little question the Lacefield salary is excessive and entirely unreasonable" given that the company is winding down operations.

Vesta twice has won court permission to keep paying Lacefield and other executives, saying they were indispensable to wrapping up operations in an orderly manner. Lacefield has led Vesta since February and been with the company since 2001. This year, the company became insolvent, was seized by state regulators and defaulted on payments to lenders.

Vesta hasn't reduced Lacefield's salary despite requests to do so, "no doubt" acting through the CEO, the creditors said in their filing. The creditors said they don't object to paying Lacefield $10,000 per month for whatever limited role he might have.

Vesta terminated about one-third of its 300 Birmingham headquarters employees in August, and an unspecified additional number have left since then, as suggested by court filings that say the company has moved some operations from the vast headquarters complex into smaller accommodations. Insurance subsidiaries selling coverage in Texas, Florida and Hawaii - the company's biggest markets - were seized by regulators from those states in August because they were insolvent.

The Chapter 11 section of the bankruptcy code that Vesta filed under prevents creditors from taking legal action to collect debts while a judge supervises a troubled company's financial affairs. Most payments, including executive salaries, require a judge's approval when a company is in Chapter 11.

Now, an overseer is refunding premiums, selling assets and closing the books of the home insurer. Vesta once also sold auto and catastrophe coverage. It has no insurance subsidiaries regulated by the Alabama Insurance Department, though its out-of-state units did have some Alabama customers.

In 1998, the company faced accounting irregularities that wiped out half of its market value in a day and caused tens of millions of dollars in profits to be reclassified. More accounting problems kept the company from filing SEC reports for the two years ended in July. Shares that once fetched almost $53 before the 1998 accounting crisis are now worthless.

Vesta had assets of $14.9 million and liabilities of $214.3 million when it filed in August. Bondholders who lent money expecting to be repaid with interest are owed $58.8 million. The company had a $17 million loss in 2004. Bankruptcy documents show the company spent almost $1 million the next year on cars for executives and improvements on a hunting lodge in Clarke County.

Vesta hasn't requested additional pay for Chairman Norman Gayle, who preceded Lacefield as CEO. He was earning $41,000 a month, according to the creditor filing. General Counsel Donald Thornton, the company's top lawyer, is earning $20,000 a month, a figure the creditors said they will go along with as long as the court-appointed overseer pays half of it.

[ge161741]

I appreciate the part about the company buying all the cars when they are going broke. And the management padding their pockets after screwing this thing up. Dang. People lost their jobs cause they're incompetence. Just make sure I get a few thousand a week so I don't suffer. BS

[vonray]

Bye Bye Vesta Bye Bye

Vesta officers face bills in suit
Company covering execs asks court if it can pay legal fees
Tuesday, October 10, 2006
RUSSELL HUBBARD
News staff writer

The insurance company covering executives of bankrupt Vesta Insurance Group against lawsuits has asked the court if it's OK to pay their legal fees.

Bermuda-based XL Insurance said in a filing last week with U.S. Bankruptcy Court in Birmingham that Vesta executives including Chairman Norman Gayle want money to defend a Jefferson County lawsuit that accuses them of ruining the company.

XL Insurance said in its filing that the executives have asked for legal fees after being sued in Jefferson County Circuit Court and accused of "maliciously, wantonly and negligently" mismanaging the company. Unpaid bondholders filed the suit in July.

During corporate bankruptcies such as Vesta's, most financial transactions require a supervising judge's approval. XL Insurance said it knows such payments from an insurer to executives of a bankrupt company aren't usually subject to court supervision, but that it filed its motion "out of an abundance of caution."

The payment of the legal fees is set for a hearing later this month. Birmingham-based Vesta, an auto and homeowner's insurer, was thrown into bankruptcy by angry creditors in August. It is now wrapping up operations after it went insolvent this summer and was shut by regulators from Texas, Hawaii and Florida, where the company did most of its business.

More than half the 300 employees who worked at the headquarters on River Run Road were cut in August, and court documents suggest more have been dismissed.

That's because a liquidation company hired by the Texas Insurance Department to shutter the company told the court in documents last month that it has already moved some operations to a smaller building, and needs time to find other accommodations before it can vacate the vast corporate headquarters. The few employees who are left are performing mop-up jobs, such as refunding premiums and closing the books.

Chief Executive David Lacefield and General Counsel Donald Thornton, who ran the company as it plunged into bankruptcy, were still being paid by Vesta at the end of September. That's according to late September court filings by creditors who objected to their continued employment. The document doesn't say how much each man is set to earn for October, but an earlier pot of money approved by the court for executive salaries amounted to $6,000 a week apiece.

Vesta was once one of Birmingham's top publicly traded companies, with a stock price of $50 a share in 1998. That's when the first case of improper accounting hit, costing CEO Robert Huffman his job and most of the company's market value after tens of millions of profits were erased and shifted to periods other than their original ones.

More accounting problems emerged. The company didn't file quarterly reports with the Securities and Exchange Commission for the two years ended July, citing unspecified problems with the books. Bankruptcy documents later showed Vesta had a $17.3 million loss in 2004, a year during which it spent $316,000 on new vehicles for top executives and $676,000 to improve a hunting lodge it owns in Clarke County.

Vesta has assets of $14.9 million and liabilities of $214.3 million. Bondholders who lent money expecting to be repaid with interest are owed $58.8 million.

A trickle of new money might be flowing in to the company. Vesta last month asked the court for permission to hire an auctioneer to sell "miscellaneous assets," which together aren't expected to fetch more than $500,000.

[fwayneh1]

Posted by Same53 on Yahoo.
Might make your blood boil a bit.

http://www.faulkingtruth.com/Articles/Investing101/1066.html

[vonray]

Bankrupt Vesta hiring outside finance help
Friday, September 01, 2006
RUSSELL HUBBARD
News staff writer

Lawyers for bankrupt Vesta Insurance Group on Thursday received court permission to pay outside managers up to $225 an hour - just a week after getting approval to pay each of the six top executives an average of $12,000 a week to stay on board during the crisis.

The Birmingham-based company, which fired about one-third of its 300 workers this month after it became insolvent, said this week in court filings it needed to pay an outside contractor to administer things. U.S. Bankruptcy Court in Birmingham agreed.

The interim financial manager is Kevin O'Halloran and comes from a company called Newbridge Management, which hires out such experts to troubled companies. The hiring comes just a week after Vesta told the court that six top executives, including Chief Executive David Lacefield, were "indispensable" and had to be paid an average of $12,000 week to keep the company running while it restructures its debts.

"Kevin O'Halloran has years of experience in assisting struggling companies," Vesta told the court in a filing. "He has an extensive background in accounting and financial issues."

Last week, Vesta got special court permission to pay $12,000 a week in emergency salaries for the top executives. They included managers skilled in the same areas of finance and accounting as O'Halloran, such as Chief Financial Officer John Hines and Controller Edwin Meadows.

But a week after getting the special pay, some of the top executives have quit. Vesta said the defections include Hines and Meadows.

"As a result, there is currently a need for support staff," Vesta said in the court filing that asked to hire Newbridge.

The company also said in the filing it might pay other Newbridge experts up to $175 a hour.

Vesta, which sold personal and homeowner insurance, is under government supervision after regulators in Texas, Florida and Hawaii deemed it insolvent last month. It is in Chapter 11 bankruptcy protection, meaning it can still operate while it figures out how to pay creditors owed $214 million.

But insurance regulators have barred the company from taking on new policyholders, which means operations largely consist of processing claims from old customers.

This week Vesta also asked for permission to pay $137,000 in ordinary expenses, such as $10,000 to a document storage company and $17,878 to Alabama Power.

Vesta shares trade for 1 cent on the Pink Sheets. Bondholders are unpaid and thousands of customers on the northern Atlantic Coast have found themselves without hurricane insurance after regulators there told them to find new coverage.

[vonray]

Who on earth is buying this and why am I still posting? Curious as to what will happen and why it's even still trading. Also the odd person wanders over thinking they have found El Dorado. Hey I made money on this baby, but I sold and didn't hold.

From Stock Guru Stockguru.com: Price and Volume Alerts for Tuesday, September 5, 2006 - Featuring The Advanced ID Corporation ,Vesta Insurance Group, GoldSpring,Biotech Holdings, and More

Vesta Insurance Group, Inc. ( OTC: VTAI). - Friday's shares stayed even at $0.01300. The volume was at 546,835. A.M. Best Co. has revised the financial strength rating (FSR) to E (Under Regulatory Supervision) from C++ (Marginal) and the issuer credit ratings (ICR) to "d" from "b" for the property/casualty affiliates of Vesta Insurance Group (Vesta). Concurrently, A.M. Best has revised the ICR to "d" from "cc" for Vesta's parent, Vesta Insurance Group, Inc. (Other OTC: VTAI - News). Additionally, A.M. Best has revised the senior debt ratings to "d" from "cc" for Vesta's $100 million 8.75% senior unsecured debentures, due 2025 and to "d" from "c" for Vesta Capital Trust I's $100 million 8.525% deferrable capital securities, due 2027. All companies are located in Birmingham, AL.

Vesta Insurance Group, Inc. (OTC: VTAI) - Vesta, headquartered in Birmingham, Ala., is a holding company for a group of insurance companies that primarily offer property insurance in targeted states.

[vonray]

The management where total morons. Not as if we haven't seen that before.

I'd hoped they could be rescued by a buyout/takeover, making this a potential great buy. But not anymore. Curious to watch though.

More From The Birmingham News
Vesta kept spending amid woes
Buying spree included cars and costly bridge
Friday, August 25, 2006
RUSSELL HUBBARD
News staff writer

In 2004, Vesta Insurance Group had a loss of $17.3 million. But that didn't motivate any belt-tightening at the now-bankrupt Birmingham insurer, according to court documents.

Filings this week with U.S. Bankruptcy Court in Birmingham exhaustively detail the company's expenditures in recent years. The firm filed for bankruptcy earlier this month.

People who might be in for a shock include customers holding worthless policies, more than 100 fired workers, shareholders who have seen their stock fall to a penny, and out-of-luck bondholders who lent money expecting to be repaid.

Vesta's 2005 buying spree started in January, right after the company closed the books on its money-losing 2004. Expenditures included $316,000 for 10 vehicles, including a BMW 530i that cost $58,000. Then there was the $676,000 Vesta spent on a bridge across the Alabama River.

The company acknowledged in court papers that it owns property in Clarke County with a lodge, other buildings and a bridge the company paid for. Vesta said the property is counted on its books as worth $1.5 million, and is held by a wholly owned subsidiary called Vesta Timber LLC.

Attempts to reach Vesta were unsuccessful, but the bridge has made it onto the Internet. The Web site of Troy-based Conecuh Bridge and Engineering lists it as "featured project," complete with photos.

"Eight spans, 40 feet long, each on steel tower bents," the Web site says, citing the owner as Vesta Timber of Birmingham. "Built on vertical curve from waterborne river barge."

The last $45,000 payment for bridge work was made in December 2005, bringing the total cost to almost $700,000, according to the court filings. Nine months later - August 2006 - the company was thrown into bankruptcy by unpaid bondholders. Vesta said in an earlier court filing that it has released 110 employees, one-third of its workforce, because it couldn't afford to pay them.

But the top executives are being paid. Vesta this month got emergency bankruptcy court approval to spend $74,000 to pay salaries of the six top officers, including Chief Executive David Lacefield, through Sept. 1.

At the same time, Vesta's insurance subsidiaries are under government control in Texas, Florida and Hawaii. Regulators there found them insolvent and have told policyholders to find new coverage. The company, though based at offices in Liberty Park, didn't have any individual insurance subsidiaries regulated by the Alabama Insurance Department.

Shareholders haven't fared much better. The stock traded for 2 cents Thursday. From June 2004 until May 2006, Vesta didn't file quarterly financial statements with the Securities and Exchange Commission, citing accounting problems. The shares were removed from the New York Stock Exchange in February and now trade on an exchange with less rigid requirements called the Pink Sheets.

Aside from bridges, Vesta had a taste for vehicles, the court documents show. Vehicle expenditures in 2005 included $35,000 for a Ford Expedition and another $35,000 for an otherwise unidentified Chrysler. A Honda pilot was bought for $30,414, and a Toyota Sequoia for $32,000.

The company's bankruptcy court filings this week also include the first look creditors have gotten at the company's assets and liabilities. Vesta said it has assets of $14.9 million and liabilities of $214.3 million. Vesta said it owes wholly owned subsidiaries valued at $150 million. The largest external creditors are bondholders owed $58.8 million.

[vonray]

Don't think this will become a buy again, just posting this stuff as I find it.

More From The Birmingham News
Bankrupt Vesta given OK to pay execs $74,000
Sunday, August 20, 2006
RUSSELL HUBBARD
News staff writer

Bankrupt Vesta Insurance Group has won special permission to pay a total of $74,000 to six executives for less than a month's work, after having terminated almost one-third of the rank-and-file work force to cut costs.

The Birmingham-based insurer told the court, which must approve all extraordinary expenditures, the six "are critical to the operation" of the company, which is trying to reorganize its finances while negotiating with creditors. The request was granted by U.S. District Court in Birmingham Friday.

The executives include Chairman Norman Gayle, Chief Executive David Lacefield, finance chief John Hines and General Counsel Donald Thornton. Vesta filed for bankruptcy protection this month after its subsidiary firms were found insolvent, bondholders went unpaid and no progress was made on explaining unspecified accounting problems that have kept investors in the dark for almost one year.

The company did say in the court filing it got rid of 110 of 300 employees in early August because it couldn't pay them.

But the top six - who also include Secretary John McCullough and Controller Edwin Meadows - are indispensable, Vesta said. The filing said the group is owed $37,000 for the pay period ended Friday. Another $37,000 will be required Sept. 1.

But that's only half of it: an outside firm hired by regulators that's winding down Vesta's individual insurance subsidiaries has already agreed to pay 50 percent of the executive salaries. That means Vesta's request for $74,000 will be combined with $74,000 from the outside firm, the company said in its court filing.

Combining Vesta's court-approved contribution of $74,000 with the outside firm's identical total shows the executive pay for Aug. 18 through Sept. 1 is $148,000. Court documents don't say who gets what. But if the money is evenly divided, it works out to $24,667 for each of the six for two weeks work.

Attempts to reach officials with Vesta were unsuccessful.

Vesta hasn't yet told the court how much it owes or how much money it has. It was thrown into involuntary bankruptcy last month by unpaid bondholders, but successfully requested that the matter be converted to a voluntary petition.

The company hasn't filed quarterly financial statements with the Securities and Exchange Commission since Sept. 2004, citing unspecified accounting problems. Shares were removed from the New York Stock Exchange this year. They trade for 1 cent. Regulators in Texas, Florida and Hawaii seized Vesta's individual operating companies last month, saying they were broke and couldn't pay claims.

[vonray]

Vesta Insurance Group (including Texas Select) Consumer Frequently Asked Questions

(Updated 08/11/2006)


http://www.tdi.state.tx.us/consumer/vestaconfaq.html

[vonray]

21-Aug-2006

Change in Directors or Principal Officers


Item 5.02 Departure of Director or Principal Officers; Election of Directors; Appointment of Principal Officers

On August 15, 2006, John Hines resigned as Senior Vice President, Chief Financial Officer and Treasurer of Vesta Insurance Group, Inc. ("Vesta"). The resignation is effective September 1, 2006.

On August 18, 2006, E. Murray Meadows resigned as Vice President and Controller (chief accounting officer) of Vesta. The resignation is effective September 1, 2006.

[john wayne]

Getting down near the 52 week low
Could bounce, If they ever turn things around you could retire buying and holding down here

[was WALL STREET KID]

VTAI 3 x 1 UT .022 ask !

[was WALL STREET KID]

AND... I bet there's a few shorters to cover on this one to boot.

[was WALL STREET KID]

* VTAI was "NYSE" stock, this POS is better than most fully reporting OTCBB's... lol


http://www.marketwatch.com/News/Story/Story.aspx?guid=%7BC37730F0%2D26B0%2D4AE4%2DAE51%2D9DB948BB61E...

[mkinhaw]

Yes you re right but
rarely do the common shares
have any value and will be cancelled
Sometimes thoug they do not get cancelled
lol
look at UHAL that went from 6.00 or so
to 80.00 or so
MK

[was WALL STREET KID]

Chapter 11 is not liquidation; it is reorganization. Once Chapter 11 is filed, the company may "emerge" from bankruptcy within a few weeks, months or within several years, depending on the size and complexity of the bankruptcy.

[mkinhaw]

Yes they chged from ch 7 to ch 11
have to see if common will get cancelled
didn t read enough yet
too tired lol
and no not in any more
sold at 0.06
MK

[was WALL STREET KID]

I'm watching this one close... There may be a BIG buy-out, by a larger insurance co. >>>

State takes over insurer
by Houston Chronicle - Jul 04,2006

Vesta subsidiary still operating as Texas seeks buyer

Texas regulators have taken over the state's sixth-largest home insurance company and are looking for a buyer for it and many of its sister companies.

The Texas Select Lloyds, with 157,068 policyholders statewide, continues to issue and renew policies, pay agent commissions, and pay claims, according to state regulators.

Customers should continue making premium payments, regulators said.

A 'rehabilitator'

The Texas Department of Insurance said Monday a state district judge had granted an order appointing the state insurance commissioner as "rehabilitator," essentially giving the state power to take over the operations of the company, a subsidiary of Birmingham, Ala.-based Vesta Insurance Group.

Rating firm AM Best downgraded Vesta's property casualty subsidiaries' ratings to C , or marginal, from B, or fair, in March because of the company's higher than expected hurricane related losses.

In January, Vesta was delisted from the New York Stock Exchange.

"We've been watching them for a while," said Jim Hurley, a spokesman for the state Department of Insurance. "This was a pre-emptive move to make sure the policyholders are taken care of."


Parent's problems

Texas Select had actually been doing well in Texas, Hurley said, but was being affected by its parent company's inability to raise capital.

Texas Select posted a net income of $1.7 million in 2005, compared with a loss of $1.8 million in 2004, according to the state department. The company's surplus also climbed to $9.8 million in 2005, from $8.8 million in 2004, the department said.

Hurley said the department is negotiating with a prospective buyer for the Texas affiliate and other sister companies, but he declined to name it.

Regulators in Florida and Hawaii have also taken over Vesta subsidiaries.

Other Vesta subsidiaries in rehabilitation and under the control of Texas regulators include: Vesta Fire Insurance Corp., Vesta Insurance Corp., Shelby Insurance Co., Shelby Casualty Insurance Corp. and Select Insurance Services.

Vesta officials did not return calls for comment.

[was WALL STREET KID]

Board: I heard re-organization rumors, is this true? Could explain the recent turnaround in pps......TIA

[vonray]

Insurer of Shore homes being liquidated in two weeks

Philadelphia Inquirer

By Benjamin Y. Lowe

August 09, 2006

We had a very likely buyer for a while, and then the more that was revealed, the less appealing [Vesta] became

The slow death of Shelby Casualty Insurance Co. has left thousands of Jersey Shore homeowners scrambling to find new policies before theirs are voided two weeks from tomorrow.

The Vesta Insurance Group Inc., Shelby's parent, is being liquidated by the Texas Department of Insurance and will not fulfill premiums after that date. The company, based in Birmingham, Ala., did not return phone calls seeking comment.

Shelby's liquidation has affected 15,000 New Jersey homeowners, including about 4,000 along the Shore, Jim Gardner, a spokesman for the New Jersey Department of Banking and Insurance, said today.

'We're scrambling to get replacement policies,' said Angela Atohi, the Seaville, N.J., branch manager for the McMahon Agency, of Ocean City. 'We're talking about some of the most high-risk Shore properties.'

Replacement insurance, she said, will cost homeowners double to triple what they paid Shelby and cannot be paid in installments. Atohi said her firm had 2,700 policyholders with Shelby Casualty.

Gardner said the New Jersey Property-Liability Insurance Guaranty Association - a state-managed insurer of last resort - would pay claims up to a maximum of $300,000, as well as pay for refunds on premiums. He also said the state had suspended requirements that property owners in high-risk areas solicit three private companies before turning to the state guaranty association.

Vesta's financial troubles, which began in 2003, were exacerbated by Hurricanes Katrina and Rita. It has had multiple symptoms of a troubled company since then.

The company changed auditors in December; its stock was delisted from the New York Stock Exchange in January; it hired a new chief executive officer in February; and its insurance ratings were reduced in March.

Jerry Hagins, a spokesman for the Texas Department of Insurance, said the agency tried to sell the company in June, before making a decision in July to liquidate it.

'We had a very likely buyer for a while, and then the more that was revealed, the less appealing [Vesta] became,' he said. Most companies, he added, had reserves to handle claims brought by Gulf Coast hurricane victims.

'In this case,' he said, 'their situation wasn't sound going into it.'

Kim DeAngelis, an insurance agent for Diller & Fischer in Stone Harbor and Avalon, said she did not expect too much difficulty transferring her 600 Shelby policyholders to a new company - as long as she was prepared to work 12-hour days for a while.

'It's just time-consuming,' she said. 'We were totally assured many times they had an investor and that their rating would go up. This has been a total blow, a total shock.'

Copyright © 2006 Philadelphia Inquirer, All Rights Reserved.

[lifegear]

it does take awhile for Chapter 7 liquidation and first dibs goes to bondholders and creditors before common shareholders

[vonray]

I even tried running separate checks on individual companies within the group:

For example,

But the key line is "Receivership For Rehabilitation"

TEXAS SELECT LLOYDS INSURANCE COMPANY

General Information:
Type of Entity: CL
Status of TX License: Active
NAIC Number: 43885
TDI Company Number: 5518
Company Type Code (Old / New): 12/83
FEIN: 752352429
Home City/State: San Antonio, TX
Origin: Domestic
Date Formed: 11/16/1990
Date Licensed in Texas: 11/28/1990
Date License Cancelled:
Company Status: Receivership For Rehabilitation
Category: Lloyds
Class Code: Property & Casualty
Contact Information:
Mailing Address: 27310 Ranch Road 12
S.D.R. Prime Tempus Inc.
Dripping Springs TX 78620
Office Number: [phone]
Toll Free Number:
Fax Number: [phone]

[vonray]

None of the following is good, so buyer beware:

Ongoing woes may force sale of Vesta subsidiaries

By Tiffany Ray
Birmingham Business Journal
Updated: 8:00 p.m. ET July 16, 2006

Vesta Insurance Group Inc.'s largest subsidiary and at least six others could be on the block as regulators in three states labor to protect policyholders from the company's ongoing financial ills.

Earlier this month, the company announced that its largest subsidiary, Vesta Fire Insurance Corp., along with Vesta Insurance Corp., Shelby Insurance Co., Shelby Casualty Insurance Corp., Texas Select Lloyds Insurance Co. and Select Insurance Services Inc., had been placed into court-ordered rehabilitation in Texas.

In addition, the Florida Department of Insurance placed Vesta's Sarasota subsidiary, Florida Select Insurance Co., into rehabilitation under that state's Department of Financial Services. And in Hawaii, the state's insurance commissioner has taken control of Hawaiian Insurance & Guaranty Co. Ltd., another Vesta subsidiary.

News of the rehabilitations is the latest in a string of blows that have brought share prices for the Birmingham-based insurer to just over a penny as of Wednesday, July 12.

Plagued by accounting errors and hit with losses from the spate of recent hurricanes in Florida, Texas and other states, Vesta has lagged in filing financial statements with the U.S. Securities and Exchange Commission. The company has yet to file financial statements for 2005 or the current year and has worked to restate results for previous years.

Statements filed in May for 2004 reported a net loss of $136.7 million for the year, compared with a net loss of $119.8 million in 2003. Per diluted share, the loss was $3.85 in 2004, compared with a loss of $3.43 in 2003. Total revenue declined in 2004 to $472 million, down from $616.4 million in 2003.

In 2004, hurricanes Ivan and Jeanne resulted in a combined net loss of about $66.5 million, the company reported. The company noted in the filing that it was hit with a subsequent net loss of $30.6 million from 2005 hurricanes.

Late last year, the company announced it would be delisted from the New York Stock Exchange. In January, Vesta shares began trading on the Pink Sheets Electronic Quotation Service under the ticker symbol VTAI.PK.

News of the rehabilitation orders led to quick revisions by ratings agencies. A.M. Best Co. revised its financial strength rating for the subsidiaries to "E", indicating that they are under regulatory supervision, from C++, or marginal. The issuer credit ratings - that is, ratings on any corporate debt the company might issue - were lowered to "d" from "b" for Vesta's insurance affiliates and to "d" from "cc" for the parent company.

Moody's Investors Service lowered Vesta's senior debt rating to a C from B3.

Vesta indicated in its announcement of the rehabilitation orders that the move constitutes a default on its $70 million long-term debt securities. With that and other factors, Moody's says in a statement, the holding company's ability to meet its debt obligations "appears to be severely strained."

The limited information available on its financial situation creates a lot of uncertainty about the company, says Pano Karambelas, vice president and senior analyst in Moody's Financial Institutions Group. Without financial filings, it's difficult to determine how much cash flow the company is generating and whether it is sufficient to service its debts.

Additionally, Karambelas says news of the rehabilitation may hamper the company's ongoing business prospects.

Peter Brink, a senior financial analyst with Weiss Ratings Inc. in New York, agrees. "They might say they're open for business, but who's going to go there?" he says.

Brink says the rehabilitation orders triggered a downgrade to an "F" rating for Vesta's insurance subsidiaries.

David W. Lacefield, who was named CEO of the ailing company in February, could not be reached for comment.

Under the terms of rehabilitation, policies and coverage remain in place, and subsidiaries continue to process and pay claims. But control of operations has shifted from Vesta's corporate leaders to regulators in each state.

"For all intents and purposes, we are running the company," says Jim Hurley, a spokesman for the Texas Department of Insurance.

Hurley says Texas' decision to take control of Vesta's six subsidiaries there was based on an accumulation of factors, but the department decided to make the move after efforts by Vesta to recapitalize operations there fell through.

"At the end of the day, you've got to make a gut call for when you pull the trigger," he says.

Although Hurley says a number of alternatives are available in dealing with the companies, a news release from the department says Texas regulators are "currently in active negotiations with a potential buyer that will recapitalize a number of the Vesta companies."

Hurley declined to elaborate.

Regulators in Honolulu say the Hawaii company's financial condition was "adversely affected" by the experiences of Vesta Insurance Group and its Vesta Fire Insurance and other subsidiaries. A news release from the Hawaii Department of Commerce and Consumer Affairs says the commissioner, along with regulators in other states, is "currently considering a number of options, including proposals from companies that will provide additional capital to" Vesta Fire Insurance and Hawaiian Insurance & Guaranty.

Nina Banister, a spokeswoman for Florida Department of Financial Services in Tallahassee, says Florida Select was unable to secure the reinsurance it needed to bolster reserves after its existing reinsurance expired June 30, and that triggered the decision by the state's Insurance Department to place the company in rehabilitation.
© 2006 Birmingham Business Journal

[lifegear]

VTAI o/s shrunk from 38.5M(last 10Q) to 37M.....

The number of shares outstanding of the registrant’s common stock, as of March 31, 2006, is 37,101,129.

[Poundthetable]

vtai MORE buying pressure today.a big move coming soon from where it left off last week,someone accumulating cheap shares as many as they can...holdem tight!
Weeeeeeeeeeeeeeeeeeeee

[Poundthetable]

news expected this week,looking good.

[Poundthetable]

VTAI bouncing today .02x.023

[Timing]

Ouch. $8k gain to a loss all in 3 daze. sad.

[lifegear]

hmmm...this is brutal lol..they have 30 days to pay debenture interests otherwise in default with the bank according to the 8k...will the bank own the subsidiaries by default?

[mkinhaw]

NP VR
too bad
MK

[vonray]

Thanks for the info MK

VR

[mkinhaw]

VTAI 8 K filed 7/19
http://secfilings.nasdaq.com/filingFrameset.asp?FileName=0001193125%2D06%2D149305%2Etxt&FilePath...
thats why its down
MK

[lifegear]

not sure..IR should be back next week

[LoveAGain]

Normal profit taking, It made a huge gains in a short time. Maybe one more red day?

[itsmikie]

LOL... Not Me...LOL !!!!!!

[lifegear]

someone shorting? bidwhacking...

[LoveAGain]

Nice buying and getting bid support. eom

[lifegear]

I tried but nothing so far

[LCLiving]

IR is out til next week.

[Timing]

A little shake down...looks over (for now).

Lifegear...you get in touch with the company?

Timing

[LoveAGain]

Here we go!!! Looking fine! eom

[lifegear]

I particularly like the long white candle forming this week...looking bullish so far

[LoveAGain]

Thank you lifegear.
Just came back from a long hot day at the office and like what I see. Still holding all my shares from .014 area.

[lifegear]

VTAI Weekly Chart

[Timing]

Exactly, and I am recently back into it, FWIW...

They pay 4 cent per Q divi and reverse P/E is about 3-4.

Again, VTAI could turn around and shine in a few years.

Timing

[lifegear]

that's a good comparison...UVIH is also an insurance stock from pennies to $2.00

[LCLiving]

I would agree but word gets out regardless. Good luck here, I'm just watching for now.

[itsmikie]

This is one stock,,, we don't need to spread out..!!! Let people find it.. the reason is the big flippers come in and ruin the run. Let's just see if the company responds to some questions first...