As filed with the Securities and Exchange Commission on January 31, 2001.
Registration No. 333-41560
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Post-Effective Amendment No. 1
to
Form S-3
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
VESTA INSURANCE GROUP, INC.
(Exact name of registrant as specified in its charter)
Delaware 6711 63-1097283
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification No.)
3760 River Run Drive
Birmingham, Alabama 35243
(205) 970-7000
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
John McCullough, Vice President and Associate General Counsel
Vesta Insurance Group, Inc.
3760 River Run Drive
Birmingham, Alabama 35243
(205) 970-7000
(Name, address, including zip code, and telephone
number, including area code, of agent for service)
Approximate date of commencement As soon as practicable following the effective
of proposed sale to the public: date of this Registration Statement.
If the only securities being registered on this form are being offered pursuant to dividend or interest reinvestment plans, check the following box. |_|
If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. |X|
If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. |_|
If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. |_|
If delivery of the prospectus is expected to be made pursuant to Rule 434, check the following box. |_|
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a), SHALL DETERMINE.
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
SUBJECT TO COMPLETION, DATED January 31, 2001
[Logo]
5,900,000 SHARES OF COMMON STOCK
VESTA INSURANCE GROUP, INC.
Vesta Insurance Group, Inc. is offering up to 5,900,000 shares of our common stock. We may offer these shares from time
to time directly to investors, through agents or finders acting on our behalf, or through underwriters. We will sell these shares
directly, or through our agents or finders, at negotiated prices. If we engage any underwriters to sell these shares, we will set
forth in a prospectus supplement the nature of the underwriting arrangements, the applicable underwriters discounts and commissions
and the net proceeds we will receive in the sales.
We have listed these shares of our common stock for trading on the New York Stock Exchange under the symbol "VTA."
TABLE OF CONTENTS
Page
----
VESTA INSURANCE GROUP ........................................................................... 1
RISK FACTORS .................................................................................... 1
INCORPORATON OF CERTAIN DOCUMENTS BY REFERENCE .................................................. 4
USE OF PROCEEDS ................................................................................ 4
PLAN OF DISTRIBUTION ............................................................................ 4
VALIDITY OF SECURITIES .......................................................................... 5
EXPERTS ......................................................................................... 5
WHERE YOU CAN FIND MORE INFORMATION ............................................................ 6
You should carefully consider the risks described below before making an investment decision. The risks and uncertainties described below are not the only ones we may face. If any of the following risks actually occur, our business, financial condition or results of operations could be materially and adversely affected. In such case, the trading price of our Common stock could decline, and you may lose all or part of your investment.
We compete with dozens of property and casualty insurance companies, many of which are better capitalized than us and have higher A.M. Best ratings than us. We believe that the superior capitalization of many of our competitors enables them to withstand lower profit margins and, therefore, to offer lower rates. We believe that the superior capitalization of many of our competitors enables them to market their products more aggressively and to take advantage more quickly of new marketing opportunities, such as the internet. We also believe that our competition may become increasingly better capitalized in the future as the traditional barriers between insurance companies and banks and other financial institutions erode and as the property and casualty industry continues to consolidate. We believe that our ability to compete against our larger, better capitalized competitors depends on our ability to deliver superior service and our strong relationships with our independent agency force.
If Our Competitors Decided to Target Our Customer Base by Offering Lower Priced Insurance, We May Not Be Able to Respond CompetitivelyWe price our insurance based on estimated profit margins, and we do not expect to be able to significantly reduce our current estimated profit margins in the near future. Many of our competitors, however, are better capitalized than we are and may be able to withstand significant reductions in their estimated profit margins. If our competitors decided to target our customer base by offering lower priced insurance, we may not be able to respond competitively.
Because we do business with approximately 2,500 agents in approximately 40 states, we must be able to offer these agents innovative solutions to their daily problems and be able to respond to their needs as quickly as possible to develop their loyalty. If our agency force finds it easier to do business with our competitors, we may not be able to retain their business.
If We Cannot Maintain and Improve Our A.M. Best Ratings, We May Not Be Able to Maintain Premium Volume in Our Insurance Operations Sufficient to Attain Our Financial Performance GoalsOur ability to retain our existing business or to attract new business in our insurance operations depends largely on our rating by A.M. Best Company. Although A.M. Best Company upgraded our rating to "B+" in February, 2000, we believe we must further improve our rating in order to more effectively compete in the highly competitive personal lines insurance market. Although we intend to work towards a higher rating, A.M. Best Company has ultimate discretion over its rating assignments. If we are unable to achieve a higher A.M. Best rating, we may not be able to grow our premium volume sufficient to attain our financial performance goals. If A.M. Best were to downgrade our rating, we could lose significant premium volume.
Our Acquisition Strategy May Require Us to Make Significant Capital Infusions, Be Dilutive to Our Existing Shareholders, and Result in Difficulties in Assimilating and Integrating the Operations, Personnel, Technologies, Products And Information Systems of Acquired Companies.
We have announced a strategy to maximize our returns through strategic investments, including entry into non-standard automobile, life and annuity products and accident and health coverage, and we plan to pursue acquisition opportunities in the future. Acquisitions may require significant capital infusions, typically entail many risks and could result in difficulties in assimilating and integrating the operations, personnel, technologies, products and information systems of the acquired company. We may also encounter unanticipated expenditures, changing relationships with customers, suppliers and strategic partners, or contractual, intellectual property or employment issues. In addition, the key personnel of the acquired company may decide not to work for us. The acquisition of another company or its products and technologies may also require us to enter into a geographic or business market in which we have little or no prior experience. These challenges could disrupt our ongoing business, distract our management and employees and increase our expenses. In addition, acquisitions may materially and adversely affect our results of operations because they may require large one-time write-offs, increased debt and contingent liabilities, substantial depreciation or deferred compensation charges or the amortization of expenses related to goodwill and other intangible assets. We may seek to account for acquisitions under the pooling-of-interests accounting method, but that method may not be available. Any of these events could cause the price of our common stock to decline. Furthermore, if we issue equity or convertible debt securities to pay for an acquisition, the issuance may be dilutive to our existing shareholders. In addition, the equity or debt securities that we may issue could have rights, preferences or privileges senior to those of the holders of our Common Stock.Substantial Sales of Our Common Stock by Our Large Stockholders Could Cause Our Stock Price to Fall.
We have a limited number of stockholders that hold a large portion of our common stock, and a limited number of persons may acquire large portions of our common stock as a result of this offering. To the extent any large stockholder sells substantial amounts of our common stock in the public market, the market price of our common stock could fall.
(a) our Annual Report on Form 10-K for the fiscal year ended December 31, 1999 filed March 30, 2000, as amended by
Form 10-K/A filed November 29, 2000;
(b) our definitive proxy materials dated April 11, 2000 for the annual meeting of stockholders held May 18, 2000;
(c) our Quarterly Reports on Form 10-Q for the quarter ended September 30, 2000, June 30, 2000 and March 31, 2000;
(d) our Current Reports on Form 8-K filed January 30, 2001, January 11, 2001, July 14, 2000, June 21, 2000 and
January 13, 2000, and our amended current report on Form 8-K/A filed September 12, 2000;
(e) The description of our common stock set forth in our registration statement on Form 8-A, filed November 13,
1993, as supplemented by the rights registered on Form 8-A filed July 12, 2000, as amended on September 1, 2000.
We will provide without charge to each person to whom this Prospectus is delivered, on the written or oral request of any such person, a copy of any or all documents incorporated herein by reference (other than the exhibits to such documents unless such exhibits are specifically incorporated by reference). Such requests should be directed to John McCullough, Vice PresidentAssociate General Counsel, Vesta Insurance Group, Inc., 3760 River Run Drive, Birmingham, Alabama 35243.
PLAN OF DISTRIBUTION
We may sell the securities being offered hereby in one or more of the following ways from time to time:
o directly to investors;
o through agents and finders, including Cochran, Caronia and Co. Inc.; or
o to underwriters for resale to the public or to investors.
Direct Sales
o the name or names of the underwriters;
o whether the underwriting is a firm commitment or best efforts arrangement;
o the amount of shares underwritten;
o any material relationship we may have with the underwriter;
o the nature of any underwriter's compensation and any discounts and commissions to be paid to the underwriter or any dealers
in connection with the sale of the underwritten shares;
o the nature of any over-allotment option giving the underwriter the right to buy additional shares from us;
o whether the underwriter has any representation on our board of directors;
o the nature of any indemnification agreement we may have with the underwriter;
o any anticipated market stabilizing transactions in which the underwriter may engage; and
o the purchase price of the securities being offered and the net proceeds we will receive from the sale.
The estimated expenses of issuance and distribution, other than underwriting discounts and commissions, to be borne by Vesta
are:
Securities and Exchange Commission Registration Fee .......................... $10,027.75
Fees and Expenses of Counsel ................................................. 10,000.00
Fees of Accountants .......................................................... 15,000.00
Miscellaneous Expenses........................................................ 1,000.00
----------
Total $36,027.75
==========
Item 15. Indemnification of Directors and Offices
Vesta is a Delaware corporation. Section 145 of the Delaware General Corporation Law empowers a Delaware corporation to indemnify any person who was or is a party to or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative, or investigative (other than an action by or in the right of such corporation) by reason of the fact that such person is or was a director, officer, employee or agent of such corporation, or is or was serving at the request of such corporation as a director, officer, employee or agent of another corporation or enterprise. A corporation may indemnify such person against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. A corporation may, in advance of the final disposition of any civil, criminal, administrative or investigative action, suit or proceeding, pay the expenses (including attorneys’ fees) incurred by any officer or director in defending such action provided that the director or officer undertake to repay such amount if it shall ultimately be determined that he is not entitled to be indemnified by the corporation.
A Delaware corporation may indemnify officers and directors in an action by or in the right of the corporation to procure a judgment in its favor under the same conditions, except that no indemnification is permitted without judicial approval if the officer or director is adjudged to be liable to the corporation. Where the officer or director is successful on the merits or otherwise in the defense of any action referred to above, the corporation must indemnify him against the expenses (including attorneys’ fees) which he actually and reasonably incurred in connection therewith. The indemnification provided is not deemed to be exclusive of other rights to which an officer or director may be entitled under any corporation’s bylaws, agreement or otherwise.
Vesta’s Certificate of Incorporation provides that no officer or director of Vesta will be personally liable to Vesta or its shareholders for monetary damages for breach of fiduciary duty as an officer or director, except for liability (i) for any breach of the officer’s or director’s duty of loyalty to Vesta or shareholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 174 of the Delaware General Corporation Law, which concerns unlawful payments of dividends, stock purchases or redemptions, or (iv) for any transaction from which the officer or director received an improper personal benefit.
Vesta’s Bylaws provide that each director and officer of Vesta, and each person serving at the request of Vesta as a director, officer, employee or agent of any other corporation or of a partnership, joint venture, trust or other enterprise, who was or is made a party to or is threatened to be made a party to or is otherwise involved in any action, suit or proceeding, will be indemnified and held harmless to the fullest extent authorized by Delaware law against all expense, liability and loss reasonably incurred by such indemnitee in such action, suit or proceeding. Vesta’s Bylaws also provide that Vesta may maintain insurance, at its expense, to protect itself and any director, officer, employee or agent of Vesta or of another corporation, partnership, joint venture, trust or other enterprise against any expense, liability or loss.
While Vesta’s Certificate of Incorporation and Bylaws provide officers and directors with protection from awards for monetary damages for breaches of their duty of care, they do not eliminate such duty. Accordingly, the Certificate of incorporation will have no effect on the availability of equitable remedies such as an injunction or rescission based on an officer’s or a director’s breach of his or her duty of care.
Item 16. Exhibits
An index to Exhibits attached to this registration statement appears at page II-5 hereof.
Item 17. Undertakings
(a) Vesta hereby undertakes:
(1) To file, during any period in which offers or sales are being made of the securities registered hereby, a
post-effective amendment to this Registration Statement to include any material information with respect to the
plan of distribution not previously disclosed in this Registration Statement or any material change to such information
in this Registration Statement.
(2) That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment
shall be deemed to be a new Registration Statement relating to the securities offered herein, and the offering of
such securities at that time shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any of the securities being registered which
remain unsold at the termination of the offering.
Vesta hereby undertakes that, for purposes of determining any liability under
the Securities Act, each filing of Vesta’s annual report pursuant to
Section 13(a) or Section 15(d) of the Exchange Act that is incorporated by
reference in this Registration Statement shall be deemed to be a new
Registration Statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act may
be permitted to directors, officers and controlling persons of the registrant
pursuant to the foregoing provisions, or otherwise, the registrant has been
advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing this registration statement on Form S-3 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of Birmingham, State of Alabama, on January 31, 2001.
VESTA INSURANCE GROUP, INC.
By: /s/ Norman W. Gayle, III
--------------------------------------------
Norman W. Gayle, III, President
KNOW ALL MEN BY THESE PRESENTS, that each of the undersigned directors of Vesta Insurance Group, Inc., a Delaware corporation, by his execution hereof or upon an identical counterpart hereof, does hereby constitute and appoint Norman W. Gayle III and Donald W. Thornton as his true and lawful attorney-in-fact and agent, for him and in his name, place and stead, to execute and sign any and all pre-effective and post-effective amendments to this Registration Statement and to file same, with all exhibits and schedules thereto and all other documents in connection therewith, with the Securities and Exchange Commission and with such state securities authorities as may be appropriate, granting unto said attorney-in-fact and agent, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes of the undersigned might or could do in person, hereby ratifying and confirming all the acts of said attorneys-in-fact and agent or any of them which they may lawfully do in the premises or cause to be done by virtue hereof.
In accordance with the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities indicated on January 31, 2001.
SIGNATURE TITLE
/s/ Norman W. Gayle, III President (Principal Executive Officer), Director
-------------------------------------------
Norman W. Gayle, III
/s/ James E. Tait Chairman of the Board of Directors
-------------------------------------------
James E. Tait
/s/ W. Perry Cronin Chief Financial Officer (Principal Financial Officer)
-------------------------------------------
William P. Cronin
/s/ Hopson B. Nance Controller (Principal Accounting Officer)
-------------------------------------------
Hopson B. Nance
/s/ Walter M. Beale, Jr. Director
-------------------------------------------
Walter M. Beale, Jr.
/s/ Ehney A. Camp, III Director
-------------------------------------------
Ehney A. Camp, III
/s/ Alan S.,Farrior Director
-------------------------------------------
Alan S. Farrior
/s/ Clifford F. Palmer Director
-------------------------------------------
Clifford F. Palmer
/s/ Stephen R. Windom Director
-------------------------------------------
Stephen R. Windom
INDEX TO EXHIBITS
EXHIBIT NUMBER DESCRIPTION OF EXHIBIT
-------------- ----------------------
4.1 Indenture between Vesta and Southtrust Bank of Alabama, National Association, dated as of July 19, 1995
(filed as an exhibit to Vesta's Form 10-K for the year ended December 31, 1995, filed on March 28, 1996 and
incorporated herein by reference (File No. 1-12338))
4.2 Supplemental Indenture between Vesta and Southtrust Bank of Alabama, National Association, dated July 19,
1995 (filed as an exhibit to Vesta's Form 10-K for the year ended December 31, 1995, filed on March 28,
1996 and incorporated herein by reference (File No. 1-12338))
4.3 Indenture dated as of January 31, 1997, between Vesta and First Union National Bank of North Carolina, as
trustee (filed as an exhibit to Vesta's Form 10-Q for the quarter ended March 31, 1997, filed on May 13,
1997 and incorporated herein by reference (File No. 1-12338))
4.4 Amended and Restated Declaration of Trust, dated as of January 31, 1997, of Vesta Capital Trust I (filed as
an exhibit to Vesta's Form 10-Q for the quarter ended March 31, 1997, filed on May 13, 1997 and
incorporated herein by reference (File No. 1-12338)
4.5 Capital Securities Guarantee Agreement, dated as of January 31, 1997, between Vesta and First Union
National Bank of North Carolina, as trustee (filed as an exhibit to Vesta's Form 10-Q for the quarter ended
March 31, 1997, filed on May 13, 1997 and incorporated by reference (File No. 1-12338))
5 Opinion regarding validity of the shares.
23.1 Consent of KPMG LLP
23.2 Consent of PricewaterhouseCoopers LLP
23.3 Consent of Grant Thornton LLP
[Letterhead of Don Thornton]
January 31, 2001
Vesta Insurance Group, Inc.
3760 River Run Drive
Birmingham, Alabama 35243
Re: Registration Statement on Form S-3
Gentlemen:
I am Senior Vice President and General Counsel to Vesta Insurance Group, Inc. In connection with the preparation and filing of a Registration Statement on Form S-3 (the "Registration Statement") relating to the offer and sale of up to 5,900,000 shares of Vesta's common stock, $.01 par value (the "Shares") held in Vesta's treasury.
I have participated in relevant corporate proceedings, have examined all corporate records, documents, agreements or other instruments of Vesta, have made all investigations of law and have discussed with Vesta's officers all questions of fact that I have deemed necessary or appropriate.
Based upon the foregoing, I am of the opinion that the Shares have been validly issued and, when sold in the manner contemplated by the Registration Statement for consideration per share not less than the par value per share of the Shares, will be fully paid and non-assessable.
I hereby consent to the filing of this opinion as an exhibit to the Registration Statement.
Very truly yours,
/s/ Donald W. Thornton
We consent to the use of our report incorporated herein by reference and to the reference to our firm under the heading “Experts” in the prospectus.
/s/ KPMG LLPWe hereby consent to the incorporation by reference in this Registration Statement on Form S-3 of our report dated March 12, 2000 (except for Note V, for which the date is November 28, 2000) relating to the financial statements and financial statement schedules, which appears in the Vesta Insurance Group, Inc.‘s Annual Report on Form 10-K/A for the year ended December 31, 1999. We also consent to the reference to us under the heading “Experts” in such Registration Statement.
We have issued our report dated April 14, 2000 on the consolidated financial statements of Securus Financial Corporation and Subsidiaries as of December 31, 1999 and 1998 and for each of the three years in the period ended December 31, 1999, appearing in the Current Report on Form 8-K/A of Vesta Insurance Group, Inc. dated September 12, 2000, which is incorporated by reference in this Registration Statement. We consent to the incorporation by reference in this Registration Statement of the aforementioned report and to the use of our name as it appears under the caption “Experts”.