Schedule 13D

-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, MDyygkClg4tyqR/doSBDU/7zK7RpEZT5zBMLImQGifgYRYyKcU2na/YtQ42Tvvzu 3aWs04M/E21g9h5aoLq3VQ== 0001193125-08-149317.txt : 20080710 0001193125-08-149317.hdr.sgml : 20080710 20080710162051 ACCESSION NUMBER: 0001193125-08-149317 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 20080710 DATE AS OF CHANGE: 20080710 GROUP MEMBERS: RED MOUNTAIN CAPITAL MANAGEMENT, INC. GROUP MEMBERS: RED MOUNTAIN CAPITAL PARTNERS II, L.P. GROUP MEMBERS: RED MOUNTAIN CAPITAL PARTNERS III, L.P. GROUP MEMBERS: RMCP GP LLC GROUP MEMBERS: WILLEM MESDAG SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: AFFIRMATIVE INSURANCE HOLDINGS INC CENTRAL INDEX KEY: 0001282543 STANDARD INDUSTRIAL CLASSIFICATION: FIRE, MARINE & CASUALTY INSURANCE [6331] IRS NUMBER: 752770432 STATE OF INCORPORATION: DE FILING VALUES: FORM TYPE: SC 13D SEC ACT: 1934 Act SEC FILE NUMBER: 005-79966 FILM NUMBER: 08947380 BUSINESS ADDRESS: STREET 1: 4450 SOJOURN DRIVE STREET 2: SUITE 500 CITY: ADDISON STATE: TX ZIP: 75001 BUSINESS PHONE: 972-728-6300 MAIL ADDRESS: STREET 1: 4450 SOJOURN DRIVE STREET 2: SUITE 500 CITY: ADDISON STATE: TX ZIP: 75001 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: RED MOUNTAIN CAPITAL PARTNERS LLC CENTRAL INDEX KEY: 0001374588 IRS NUMBER: 731726370 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D BUSINESS ADDRESS: STREET 1: 10100 SANTA MONICA BOULEVARD, SUITE 925 CITY: LOS ANGELES STATE: CA ZIP: 90067 BUSINESS PHONE: (310) 432-0207 MAIL ADDRESS: STREET 1: 10100 SANTA MONICA BOULEVARD, SUITE 925 CITY: LOS ANGELES STATE: CA ZIP: 90067 SC 13D 1 dsc13d.htm SCHEDULE 13D Schedule 13D

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

SCHEDULE 13D

Under the Securities Exchange Act of 1934

(Amendment No. )*

AFFIRMATIVE INSURANCE HOLDINGS, INC.

(Name of Issuer)

Common Stock, par value $0.01 per share

(Title of Class of Securities)

008272106

(CUSIP Number)

Red Mountain Capital Partners LLC

Attn: Willem Mesdag

10100 Santa Monica Boulevard, Suite 925

Los Angeles, California 90067

Telephone (310) 432-0200

(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)

June 30, 2008

(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.

* 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 (“Act”) 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. 292554102 SCHEDULE 13D PAGE 2 OF 14 PAGES

1	NAME OF REPORTING PERSONS

I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)

Red Mountain Capital Partners LLC 73-1726370

2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) x

(b) ¨

3	SEC USE ONLY

4	SOURCE OF FUNDS* AF (See Item 3)

5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED ¨

PURSUANT TO ITEMS 2(d) or 2(e)

6	CITIZENSHIP OR PLACE OF ORGANIZATION

Delaware


		7 SOLE VOTING POWER
NUMBER OF
		786,497 shares (See Item 5)
SHARES		___________________________________
		8 SHARED VOTING POWER
BENEFICIALLY
		None (See Item 5)
OWNED BY		___________________________________
		9 SOLE DISPOSITIVE POWER
EACH REPORTING
		786,497 shares (See Item 5)
PERSON		___________________________________
		10 SHARED DISPOSITIVE POWER
WITH
		None (See Item 5)

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

786,497 shares (See Item 5)

12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES ¨

CERTAIN SHARES*

13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

5.1% (See Item 5)

14.

TYPE OF REPORTING PERSON*

OO – Limited Liability Company

* See Instructions

CUSIP No. 292554102 SCHEDULE 13D PAGE 3 OF 14 PAGES

1	NAME OF REPORTING PERSONS

I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)

Red Mountain Capital Partners II, L.P. 20-4117535

2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) x

(b) ¨

3	SEC USE ONLY

4	SOURCE OF FUNDS* WC (See Item 3)

5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED ¨

PURSUANT TO ITEMS 2(d) or 2(e)

6	CITIZENSHIP OR PLACE OF ORGANIZATION

Delaware


		7 SOLE VOTING POWER
NUMBER OF
		771,697 shares (See Item 5)
SHARES		___________________________________
		8 SHARED VOTING POWER
BENEFICIALLY
		None (See Item 5)
OWNED BY		___________________________________
		9 SOLE DISPOSITIVE POWER
EACH REPORTING
		771,697 shares (See Item 5)
PERSON		___________________________________
		10 SHARED DISPOSITIVE POWER
WITH
		None (See Item 5)

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

771,697 shares (See Item 5)

12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES ¨

CERTAIN SHARES*

13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

5.0% (See Item 5)

14.

TYPE OF REPORTING PERSON*

PN – Limited Partnership

* See Instructions

CUSIP No. 292554102 SCHEDULE 13D PAGE 4 OF 14 PAGES

1	NAME OF REPORTING PERSONS

I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)

Red Mountain Capital Partners III, L.P. 20-5329858

2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) x

(b) ¨

3	SEC USE ONLY

4	SOURCE OF FUNDS* WC (See Item 3)

5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED ¨

PURSUANT TO ITEMS 2(d) or 2(e)

6	CITIZENSHIP OR PLACE OF ORGANIZATION

Delaware


		7 SOLE VOTING POWER
NUMBER OF
		14,800 shares (See Item 5)
SHARES		___________________________________
		8 SHARED VOTING POWER
BENEFICIALLY
		None (See Item 5)
OWNED BY		___________________________________
		9 SOLE DISPOSITIVE POWER
EACH REPORTING
		14,800 shares (See Item 5)
PERSON		___________________________________
		10 SHARED DISPOSITIVE POWER
WITH
		None (See Item 5)

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

14,800 shares (See Item 5)

12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES ¨

CERTAIN SHARES*

13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

0.1% (See Item 5)

14.

TYPE OF REPORTING PERSON*

PN – Limited Partnership

* See Instructions

CUSIP No. 292554102 SCHEDULE 13D PAGE 5 OF 14 PAGES

1	NAME OF REPORTING PERSONS

I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)

RMCP GP LLC 20-4442412

2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) x

(b) ¨

3	SEC USE ONLY

4	SOURCE OF FUNDS* AF (See Item 3)

5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED ¨

PURSUANT TO ITEMS 2(d) or 2(e)

6	CITIZENSHIP OR PLACE OF ORGANIZATION

Delaware


		7 SOLE VOTING POWER
NUMBER OF
		786,497 shares (See Item 5)
SHARES		___________________________________
		8 SHARED VOTING POWER
BENEFICIALLY
		None (See Item 5)
OWNED BY		___________________________________
		9 SOLE DISPOSITIVE POWER
EACH REPORTING
		786,497 shares (See Item 5)
PERSON		___________________________________
		10 SHARED DISPOSITIVE POWER
WITH
		None (See Item 5)

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

786,497 shares (See Item 5)

12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES ¨

CERTAIN SHARES*

13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

5.1% (See Item 5)

14.

TYPE OF REPORTING PERSON*

OO – Limited Liability Company

* See Instructions

CUSIP No. 292554102 SCHEDULE 13D PAGE 6 OF 14 PAGES

1	NAME OF REPORTING PERSONS

I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)

Red Mountain Capital Management, Inc. 13-4057186

2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) ¨

(b) x

3	SEC USE ONLY

4	SOURCE OF FUNDS* AF (See Item 3)

5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED ¨

PURSUANT TO ITEMS 2(d) or 2(e)

6	CITIZENSHIP OR PLACE OF ORGANIZATION

Delaware


		7 SOLE VOTING POWER
NUMBER OF
		786,497 shares (See Item 5)
SHARES		___________________________________
		8 SHARED VOTING POWER
BENEFICIALLY
		None (See Item 5)
OWNED BY		___________________________________
		9 SOLE DISPOSITIVE POWER
EACH REPORTING
		786,497 shares (See Item 5)
PERSON		___________________________________
		10 SHARED DISPOSITIVE POWER
WITH
		None (See Item 5)

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

786,497 shares (See Item 5)

12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES ¨

CERTAIN SHARES*

13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

5.1% (See Item 5)

14.

TYPE OF REPORTING PERSON*

CO – Corporation

* See Instructions

CUSIP No. 292554102 SCHEDULE 13D PAGE 7 OF 14 PAGES

1	NAME OF REPORTING PERSONS

I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)

Willem Mesdag

2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) ¨

(b) x

3	SEC USE ONLY

4	SOURCE OF FUNDS* AF (See Item 3)

5	CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED ¨

PURSUANT TO ITEMS 2(d) or 2(e)

6	CITIZENSHIP OR PLACE OF ORGANIZATION

U.S. Citizen


		7 SOLE VOTING POWER
NUMBER OF
		786,497 shares (See Item 5)
SHARES		___________________________________
		8 SHARED VOTING POWER
BENEFICIALLY
		None (See Item 5)
OWNED BY		___________________________________
		9 SOLE DISPOSITIVE POWER
EACH REPORTING
		786,497 shares (See Item 5)
PERSON		___________________________________
		10 SHARED DISPOSITIVE POWER
WITH
		None (See Item 5)

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

786,497 shares (See Item 5)

12	CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES ¨

CERTAIN SHARES*

13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

5.1% (See Item 5)

14.

TYPE OF REPORTING PERSON*

IN – Individual

* See Instructions

CUSIP No. 292554102 SCHEDULE 13D PAGE 8 OF 14 PAGES

ITEM 1.

SECURITY AND ISSUER.

This statement on Schedule 13D (this “Schedule 13D”) relates to the common stock, par value $0.01 per share (“Common Stock”), of Affirmative Insurance Holdings, Inc., a Delaware corporation (“Affirmative”).

The address of the principal executive offices of Affirmative is 4450 Sojourn Drive, Suite 500, Addison Texas 75001.

ITEM 2.

IDENTITY AND BACKGROUND.

(a), (c), (f)

This Schedule 13D is being jointly filed by (i) Red Mountain Capital Partners LLC, a Delaware limited liability company (“RMCP LLC”), (ii) Red Mountain Capital Partners II, L.P., a Delaware limited partnership (“RMCP II”), (iii) Red Mountain Capital Partners III, L.P., a Delaware limited partnership (“RMCP III”), (iv) RMCP GP LLC, a Delaware limited liability company (“RMCP GP”), (v) Red Mountain Capital Management, Inc., a Delaware corporation (“RMCM”), and (vi) Willem Mesdag, a natural person and citizen of the United States of America. RMCP LLC, RMCP II, RMCP III and RMCP GP are sometimes collectively referred to herein as “Red Mountain.” Red Mountain, RMCM and Mr. Mesdag are sometimes collectively referred to herein as the “Reporting Persons.”

The principal business of each of RMCP II and RMCP III is investment. Neither RMCP II nor RMCP III was formed for the specific purpose of investing in the securities of Affirmative.

RMCP GP is the general partner of each of RMCP II and RMCP III and thus may be deemed to control each of RMCP II and RMCP III. The principal business of RMCP GP is investment.

RMCP LLC is the managing member of RMCP GP and thus may be deemed to control RMCP GP and each entity directly or indirectly controlled by RMCP GP. The principal business of RMCP LLC is investment.

RMCM is the managing member of RMCP LLC and thus may be deemed to control RMCP LLC and each entity directly or indirectly controlled by RMCP LLC. The principal business of RMCM is investment.

Mr. Mesdag is the president, sole executive officer, sole director and sole shareholder of RMCM and thus may be deemed to control RMCM and each entity directly or indirectly controlled by RMCM (including Red Mountain). The principal occupation of Mr. Mesdag is Managing Partner of Red Mountain.

J. Christopher Teets (and his principal occupation) is Partner of Red Mountain. Mr. Teets does not control any Reporting Person. Information regarding Mr. Teets is being included in this Schedule 13D only for purposes of complying with General Instruction C to Schedule 13D.

(b)

The principal executive offices of RMCM and Red Mountain are located at, and the principal business address of Mr. Mesdag and Mr. Teets is, 10100 Santa Monica Boulevard, Suite 925, Los Angeles, California 90067.

(d)-(e)

During the last five years, none of the Reporting Persons or Mr. Teets has been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction as a result of which such person was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.

CUSIP No. 292554102 SCHEDULE 13D PAGE 9 OF 14 PAGES

ITEM 3.

SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.

RMCP II has purchased an aggregate of 771,697 shares of Common Stock on the open market at an aggregate purchase price (excluding trading commissions and related administrative costs) of $10,095,001.67. The source of the funds used by RMCP II to purchase such shares was working capital of RMCP II.

RMCP III has purchased an aggregate of 14,800 shares of Common Stock on the open market at an aggregate purchase price (excluding trading commissions and related administrative costs) of $98,973.24. The source of the funds used by RMCP III to purchase such shares was working capital of RMCP III.

The information set forth in Item 5(c) below is hereby incorporated by reference in response to this Item 3.

ITEM 4.

PURPOSE OF TRANSACTION.

Red Mountain acquired the Common Stock reported in this Schedule 13D for investment purposes because it believed that the Common Stock was undervalued and represented an attractive investment opportunity.

Red Mountain has met with the management of Affirmative and expects to maintain a dialogue with management regarding, among other things, Affirmative’s operations, strategic direction, capital structure and corporate governance and Red Mountain’s expectation that management will pursue appropriate measures to enhance shareholder value. In addition, Red Mountain may communicate with other persons regarding Affirmative, including, without limitation, the board of directors of Affirmative, other shareholders of Affirmative and potential strategic or financing partners.

Red Mountain will routinely monitor and assess, among other things, (i) the financial condition, operations, prospects, capital structure and management of Affirmative, (ii) the value and price of the Common Stock, (iii) relevant business developments, competitive and strategic matters and prevailing industry and market conditions, (iv) alternative investment opportunities available to Red Mountain, (v) its liquidity requirements, and (vi) other investment considerations. On the basis of such assessments, Red Mountain may, at any time and from time to time, take such actions with respect to its investment in Affirmative as it deems appropriate, including, without limitation, (i) proposing measures which it believes would enhance shareholder value, (ii) seeking representation on the board of directors of Affirmative, (iii) purchasing additional Common Stock or other securities of Affirmative, (iv) selling some or all of any securities of Affirmative held by Red Mountain, or (v) otherwise changing its intention with respect to any of the matters referenced in this Item 4.

Except as set forth in this Item 4, Red Mountain has no present plans or proposals that relate to or would result in any of the actions required to be disclosed in this Item 4.

ITEM 5.

INTEREST IN SECURITIES OF THE ISSUER.

(a)-(b)

RMCP II beneficially owns, in the aggregate, 771,697 shares of Common Stock, which represent approximately 5.0% of the outstanding Common Stock.⁽¹⁾ RMCP II has the sole power to vote or direct the vote, and the sole power to dispose or direct the disposition, of all such 771,697 shares of Common Stock.

⁽¹⁾ All calculations of percentage ownership in this Schedule 13D are based on approximately 15,415,358 shares of Common Stock outstanding as of May 6, 2008, as reported in the Quarterly Report on Form 10-Q for the Quarterly Period ended March 31, 2008, which was filed by Affirmative with the Securities and Exchange Commission on May 9, 2008.

CUSIP No. 292554102 SCHEDULE 13D PAGE 10 OF 14 PAGES

RMCP III beneficially owns, in the aggregate, 14,800 shares of Common Stock, which represent approximately 0.1% of the outstanding Common Stock. RMCP III has the sole power to vote or direct the vote, and the sole power to dispose or direct the disposition, of all such 14,800 shares of Common Stock.

The shares of Common Stock beneficially owned by RMCP II and RMCP III, when aggregated together, total 786,497 shares, which represent approximately 5.1% of the outstanding Common Stock.

Because each of RMCP GP, RMCP LLC, RMCM and Mr. Mesdag may be deemed to control RMCP II and RMCP III, each of RMCP GP, RMCP LLC, RMCM and Mr. Mesdag may be deemed to beneficially own, and to have the power to vote or direct the vote, or dispose or direct the disposition of, all of the Common Stock beneficially owned by RMCP II and RMCP III.

Other than shares of Common Stock beneficially owned by RMCP II or RMCP III, none of the Reporting Persons or Mr. Teets may be deemed to beneficially own any shares of Common Stock.

Each of RMCP LLC, RMCP II, RMCP III and RMCP GP affirms membership in a group with each other but disclaims membership in a group with RMCM or Mr. Mesdag. Each of RMCM and Mr. Mesdag disclaims membership in a group with any person.

The filing of this Schedule 13D shall not be construed as an admission that any Reporting Person is the beneficial owner of any of the shares of Common Stock that such Reporting Person may be deemed to beneficially own. Without limiting the foregoing sentence, each of RMCM and Mr. Mesdag disclaims beneficial ownership of all shares of Common Stock reported in this Schedule 13D. In addition, the filing of this Schedule 13D shall not be construed as an admission that any partner, member, director, officer or affiliate of any Reporting Person is the beneficial owner of any of the shares of Common Stock that such partner, member, director, officer or affiliate may be deemed to beneficially own. Without limiting the foregoing sentence, Mr. Teets disclaims beneficial ownership of all shares of Common Stock reported in this Schedule 13D.

(c)

The following table lists all transactions in Common Stock effected during the past sixty days by RMCP II. All such transactions were effected on the open market.


Shares of Common Stock Purchased	Price per Share		Date of Purchase
1,200	$	6.9708	6/23/2008
900	$	6.9256	6/24/2008
5,000	$	6.9184	6/25/2008
1,400	$	6.7479	6/26/2008
2,900	$	6.8119	6/27/2008
1,300	$	6.8177	6/30/2008
800	$	6.8432	7/1/2008

CUSIP No. 292554102 SCHEDULE 13D PAGE 11 OF 14 PAGES

The following table lists all transactions in Common Stock effected during the past sixty days by RMCP III. All such transactions were effected on the open market.


Shares of Common Stock Purchased	Price per Share		Date of Purchase
2,600	$	6.7437	7/2/2008
900	$	6.7989	7/3/2008
4,700	$	6.7923	7/7/2008
1,400	$	6.5500	7/8/2008
5,200	$	6.5821	7/9/2008

Except as otherwise disclosed in this Item 5(c), none of the persons named in Item 2 above has effected any transactions in Common Stock during the past sixty days.

(d)-(e)

Not applicable.

ITEM 6.

CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER.

Other than as described in this Schedule 13D, there are no contracts, arrangements, understandings or relationships among the persons named in Item 2 above and between such persons and any person with respect to any securities of Affirmative.

ITEM 7.

MATERIALS TO BE FILED AS EXHIBITS.


Exhibit No.		Description of Exhibit

1		Joint Filing Agreement, dated as of July 10, 2008, by and among the Reporting Persons (filed herewith).

CUSIP No. 292554102 SCHEDULE 13D PAGE 12 OF 14 PAGES

SIGNATURE

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

Dated: July 10, 2008

RED MOUNTAIN CAPITAL PARTNERS LLC

/s/ Willem Mesdag

By: Willem Mesdag

Title: Authorized Signatory

RED MOUNTAIN CAPITAL PARTNERS II, L.P.

By: RMCP GP LLC, its general partner

/s/ Willem Mesdag

By: Willem Mesdag

Title: Authorized Signatory

RED MOUNTAIN CAPITAL PARTNERS III, L.P.

By: RMCP GP LLC, its general partner

/s/ Willem Mesdag

By: Willem Mesdag

Title: Authorized Signatory

RMCP GP LLC

/s/ Willem Mesdag

By: Willem Mesdag

Title: Authorized Signatory

CUSIP No. 292554102 SCHEDULE 13D PAGE 13 OF 14 PAGES

RED MOUNTAIN CAPITAL MANAGEMENT, INC.

/s/ Willem Mesdag

By: Willem Mesdag

Title: President

WILLEM MESDAG

/s/ Willem Mesdag

CUSIP No. 292554102 SCHEDULE 13D PAGE 14 OF 14 PAGES

EXHIBIT INDEX


Exhibit No.		Description of Exhibit

1		Joint Filing Agreement, dated as of July 10, 2008, by and among the Reporting Persons (filed herewith).

EX-1 2 dex1.htm JOINT FILING AGREEMENT Joint Filing Agreement

EXHIBIT 1

JOINT FILING AGREEMENT

In accordance with Rule 13d-1(k)(1) promulgated under the Securities Exchange Act of 1934, as amended, the undersigned agree to the joint filing on behalf of each of them of a Schedule 13D (including any and all amendments thereto) with respect to the common stock, par value $0.01 per share, of Affirmative Insurance Holdings, Inc., and further agree that this Joint Filing Agreement shall be included as an exhibit to such joint filings.

The undersigned further agree that each party hereto is responsible for the timely filing of such Schedule 13D and any amendments thereto, and for the completeness and accuracy of the information concerning such party contained therein; provided that no party is responsible for the completeness or accuracy of the information concerning any other filing party, unless such party knows or has reason to believe that such information is inaccurate.

This Joint Filing Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original instrument, but all of such counterparts together shall constitute but one agreement.

In evidence thereof the undersigned, being duly authorized, hereby execute this Joint Filing Agreement as of July 10, 2008.

RED MOUNTAIN CAPITAL PARTNERS LLC

/s/ Willem Mesdag

By: Willem Mesdag

Title: Authorized Signatory

RED MOUNTAIN CAPITAL PARTNERS II, L.P.

By: RMCP GP LLC, its general partner

/s/ Willem Mesdag

By: Willem Mesdag

Title: Authorized Signatory

RED MOUNTAIN CAPITAL PARTNERS III, L.P.

By: RMCP GP LLC, its general partner

/s/ Willem Mesdag

By: Willem Mesdag

Title: Authorized Signatory

RMCP GP LLC

/s/ Willem Mesdag

By: Willem Mesdag

Title: Authorized Signatory

RED MOUNTAIN CAPITAL MANAGEMENT, INC.

/s/ Willem Mesdag

By: Willem Mesdag

Title: President

WILLEM MESDAG

/s/ Willem Mesdag

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