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      Direct General 8-K 03/05/07
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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>UNITED
        STATES</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SECURITIES
        AND EXCHANGE COMMISSION</strong></font></div>
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        DC 20549</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>FORM
        8-K</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>CURRENT
        REPORT PURSUANT </strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>TO
        SECTION 13 OR 15(d) OF THE</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>SECURITIES
        EXCHANGE ACT OF 1934</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Date
        of
        report (Date of earliest event reported): </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>March
        6, 2007</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>DIRECT
        GENERAL CORPORATION</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Exact
        Name of Registrant as Specified in Charter)</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
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                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Tennessee</strong></font></div>
              </td>
              <td valign="top" width="26%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>000-50360</strong></font></div>
              </td>
              <td valign="top" width="26%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>62-1564496</strong></font></div>
              </td>
            </tr>
            <tr>
              <td valign="top" width="27%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(State
                  or Other Jurisdiction</font></div>
              </td>
              <td valign="top" width="26%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Commission</font></div>
              </td>
              <td valign="top" width="26%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(IRS
                  Employer</font></div>
              </td>
            </tr>
            <tr>
              <td valign="top" width="27%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">of
                  Incorporation)</font></div>
              </td>
              <td valign="top" width="26%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">File
                  Number)</font></div>
              </td>
              <td valign="top" width="26%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Identification
                  No.)</font></div>
              </td>
            </tr>

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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 108pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
        1281 Murfreesboro Road</strong></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 243pt">&#160;<font id="TAB2" style="LETTER-SPACING: 9pt">&#160;</font><font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;</font>&#160;<font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;<font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;<font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;<font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;<font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;<font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;<font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;<font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;<font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>37217</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 108pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
        Nashville, Tennessee</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font id="TAB1" style="MARGIN-LEFT: 108pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Address
        of Principal Executive Offices)</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 243pt">&#160;<font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;<font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;<font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;<font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;<font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;<font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;<font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;<font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font>&#160;<font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;
</font></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Zip
        Code)</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Registrant's
        Telephone Number, Including Area Code: </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>(615)
        399-4700</strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Check
        the
        appropriate box below if the Form 8-K filing is intended to simultaneously
        satisfy the filing obligation of the registrant under any of the following
        provisions:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Wingdings">o</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
        Written
        communications pursuant to Rule 425 under the Securities Act (17 CFR
        230.425)</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Wingdings">o</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
        Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
        240.14a-12)</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -18pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Wingdings">o</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
        Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
        Act
        (17 CFR 240.14d-2(b))</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 18pt; TEXT-INDENT: -18pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Wingdings">o</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
        Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
        Act
        (17 CFR 240.13e-4(c))</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div><br>
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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Item
        8.01. Other Events. </strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
        March
        6, 2007, Direct General Corporation (the "Company") issued the press release
        attached hereto as Exhibit 99.1, in which the Company announced that it had
        entered into a Memorandum of Understanding ("MOU") with the plaintiffs to
        settle
        three purported federal shareholder derivative actions filed in the first
        quarter of 2005, which have been consolidated into one action captioned as
        </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><em>In
        Re
        Direct General Corporation Derivative Litigation, </em></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">United
        States District Court for the Middle District of Tennessee, No. 3:05-0158
        (the
        "Federal Litigation"). As described below, the Federal Litigation was amended
        to
        add putative class action claims relating to the </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Company&#8217;s
        announcement of its execution of a definitive agreement to merge with Elara
        Holdings, Inc. ("Elara").</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">
        Pursuant
        to the terms of the MOU, the defendants will pay an award of attorneys' fees
        and
        expenses of $675,000, and all state and federal derivative and class action
        claims will either be voluntarily dismissed with prejudice or the parties
        in the
        Federal Litigation will take such action as is necessary to have such claims
        dismissed with prejudice. The parties also are negotiating terms that would
        provide the plaintiffs with certain benefits if Elara sells or divests Direct
        General within a certain time after the merger between Elara and Direct General
        closes. The settlement is subject to several conditions, including approval
        by
        the court in which the Federal Litigation is pending. </font></div>
      <div>&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
        December 5, 2006, the Company announced its execution of a definitive agreement
        to merge with Elara, an affiliate of Fremont Partners and Texas Pacific Group,
        under which Elara will acquire all of the outstanding common stock of the
        Company (the "Merger"). The Company's Board of Directors, based in large
        part
        upon the unanimous recommendation of the special committee of the Board of
        Directors (the "Special Committee"), approved the acquisition of the Company
        by
        Elara on the terms and subject to the conditions set forth in the merger
        agreement. In the transaction, the Company's shareholders will receive $21.25
        in
        cash for each share of the Company's common stock that they hold. The
        transaction is subject to receipt of shareholder approval and required
        regulatory approvals, as well as satisfaction of other closing conditions.
        </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
        December 6, 2006, the plaintiffs in the Federal Litigation filed a motion
        for
        leave to amend the complaint to, among other things, add claims relating
        to the
        Merger. The amended complaint alleges, among other things, that the
        consideration to be paid </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">in
        the
        Merger is unfair and is the result of an unfair process and that the Merger
        was
        agreed to by the Company's directors and officers in order to discharge their
        alleged personal liability. The amended complaint further alleges that the
        Company's directors and officers breached their fiduciary duties by agreeing
        to
        a merger structure that is designed to deter higher offers from other bidders,
        for failing to obtain the highest and best price for the Company's shareholders
        and for structuring the merger so that the individuals would receive undeserved
        change in control benefits, including the immediate vesting of unvested options.
        </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
        plaintiffs also contested whether the Special Committee members were
        disinterested and whether they had any interests in the Merger separate and
        distinct from the interest of shareholders. If the Merger is approved and
        closed, the Special Committee defendants might have asserted certain defenses
        in
        the Federal Litigation that could have provided a benefit to them separate
        from
        other shareholders. However, given the settlement in principle, all claims
        against such defendants are settled and resolved and will become final with
        court approval. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In
        addition, pursuant to the terms of the MOU, the Company has agreed to provide
        additional information to shareholders by filing such information as exhibits
        to
        this Current Report on Form 8-K. Direct General does not make any admission
        that
        such supplemental disclosures are material. The opinion of SunTrust Robinson
        Humphrey dated February 2, 2007 is attached hereto as Exhibit 99.2. A
        presentation made by SunTrust Robinson Humphrey to the Direct General Board
        of
        Directors on December 4, 2006 is attached hereto as Exhibit 99.3. A presentation
        made by SunTrust Robinson Humphrey to the Direct General Board of Directors
        on
        February 2, 2007 is attached hereto as Exhibit 99.4. SunTrust Robinson
        Humphrey&#8217;s opinion and the presentation materials were provided to the Special
        Committee and the Board of Directors of Direct General in connection with
        its
        evaluation of the merger consideration to Direct General&#8217;s shareholders (other
        than affiliates of Elara or the continuing investors). While the presentation
        materials were intended to be a materially accurate representation of the
        information that provided the basis for the opinion, they did not necessarily
        provide the complete basis for any such opinion, were not provided for the
        benefit of the shareholders and should not be relied upon by the shareholders
        in
        making investment decisions. The opinion does not address any other aspect
        of
        the proposed merger, relates only to the fairness, from a financial point
        of
        view, of the merger consideration and does not constitute a recommendation
        to
        any shareholder as to how such shareholder should vote or act with respect
        to
        any matters relating to the Merger. </font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><font id="TAB1" style="MARGIN-LEFT: 36pt"></font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">A
        special
        meeting of the shareholders to consider the Merger is set to occur on March
        8,
        2007 at the Company's corporate headquarters located at 1281 Murfreesboro
        Rd,
        Nashville, Tennessee 37217 at 11:00 am local time.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
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        report contains forward-looking statements based on current expectations
        of the
        Company&#8217;s management. Those forward-looking statements include all statements
        other than those made solely with respect to historical fact. Numerous risks,
        uncertainties and other factors may cause actual results to differ materially
        from those expressed in any forward-looking statements. These factors include,
        but are not limited to, (1) the failure to obtain approval of the Stipulation
        of
        Settlement by the court; (2) a party withdrawing or otherwise terminating
        its
        participation in the MOU; or (3) other factors that are described in the
        Company&#8217;s filings made with the Securities and Exchange Commission. While the
        Company&#8217;s management makes projections and estimates in good faith, many of the
        factors that will determine the outcome of the subject matter are beyond
        the
        Company&#8217;s ability to control or predict. The Company undertakes no obligation to
        revise or update any forward-looking statements, or to make any other
        forward-looking statements, whether as a result of new information, future
        events or otherwise.</font></div>
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            <tr>
              <td valign="bottom" width="13%" style="border-bottom: black thin solid;">
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                  Number</strong></font></div>
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                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Press
                  release issued by Direct General Corporation, dated March 6,
                  2007</font></div>
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            <tr>
              <td valign="top" width="13%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">99.2</font></div>
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                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Opinion
                  of SunTrust Robinson Humphrey, dated February 2, 2007</font></div>
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            <tr>
              <td valign="top" width="13%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">99.3</font></div>
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                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SunTrust
                  Robinson Humphrey Presentation to the Board of Directors, dated
                  December
                  4, 2006</font></div>
              </td>
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            <tr>
              <td valign="top" width="13%">
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                  Robinson Humphrey Presentation to the Board of Directors, dated
                  February
                  2, 2007</font></div>
              </td>
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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 36pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify"><br>&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="justify">&#160;</div><br>
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        duly authorized.</font></div>
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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 216pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">DIRECT
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      <div style="DISPLAY: block; MARGIN-LEFT: 216pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Registrant)</font></div>
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      <div style="DISPLAY: block; MARGIN-LEFT: 279pt; TEXT-INDENT: -63pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">By:</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 13.5pt">&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><u>/s/
        Ronald F. Wilson</u></font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 4.5pt">&#160;</font><font id="TAB2" style="COLOR: black; LETTER-SPACING: 27pt">&#160;</font></div>
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            <tr valign="top" style="line-height: 1.25;">
              <td style="width: 216pt;">&#160;</td>
              <td style="width: 18pt;">&#160;</td>
              <td style="width: 36pt;">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Name:</font></div>
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                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Ronald
                  F. Wilson</font></div>
              </td>
            </tr>

        </table>
      </div>
      <div>
        <table align="center" border="0" cellpadding="0" cellspacing="0" id="hangingindent" width="100%">

            <tr valign="top" style="line-height: 1.25;">
              <td style="width: 216pt;">&#160;</td>
              <td style="width: 18pt;">&#160;</td>
              <td style="width: 36pt;">
                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Title:</font></div>
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                <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Secretary</font></div>
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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Date:
        March 6, 2007</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br>&#160;</div><br>
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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>INDEX
        TO EXHIBITS </strong></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
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            <tr>
              <td valign="bottom" width="13%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Exhibit
                  Number</strong></font></div>
              </td>
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                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><strong>Description</strong></font></div>
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            <tr>
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                  release issued by Direct General Corporation, dated March 6,
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            </tr>
            <tr>
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              <td align="left" valign="bottom" width="67%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Opinion
                  of SunTrust Robinson Humphrey, dated February 2, 2007</font></div>
              </td>
            </tr>
            <tr>
              <td valign="bottom" width="13%" style="border-bottom: black thin solid;">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">99.3</font></div>
              </td>
              <td align="left" valign="bottom" width="67%" style="border-bottom: black thin solid;">
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                  Robinson Humphrey Presentation to the Board of Directors, dated
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              </td>
            </tr>
            <tr>
              <td valign="bottom" width="13%" style="border-bottom: black thin solid;">
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              </td>
              <td align="left" valign="bottom" width="67%" style="border-bottom: black thin solid;">
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                  Robinson Humphrey Presentation to the Board of Directors, dated
                  February
                  2, 2007</font></div>
              </td>
            </tr>

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    <div>&#160;</div>
    <div><br>&#160;</div>
    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; LINE-HEIGHT: 1.25; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
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Direct General 8-K 03/05/07
UNITED
        STATES
SECURITIES
        AND EXCHANGE COMMISSION
WASHINGTON,
        DC 20549
FORM
        8-K
CURRENT
        REPORT PURSUANT
TO
        SECTION 13 OR 15(d) OF THE
SECURITIES
        EXCHANGE ACT OF 1934
Date
        of
        report (Date of earliest event reported):
March
        6, 2007
DIRECT
        GENERAL CORPORATION
(Exact
        Name of Registrant as Specified in Charter)
Tennessee
000-50360
62-1564496
(State
                  or Other Jurisdiction
(Commission
(IRS
                  Employer
of
                  Incorporation)
File
                  Number)
Identification
                  No.)
1281 Murfreesboro Road
37217
Nashville, Tennessee
(Address
        of Principal Executive Offices)
(Zip
        Code)
Registrant's
        Telephone Number, Including Area Code:
(615)
        399-4700
Check
        the
        appropriate box below if the Form 8-K filing is intended to simultaneously
        satisfy the filing obligation of the registrant under any of the following
        provisions:
o
Written
        communications pursuant to Rule 425 under the Securities Act (17 CFR
        230.425)
o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
        240.14a-12)
o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
        Act
        (17 CFR 240.14d-2(b))
o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
        Act
        (17 CFR 240.13e-4(c))
Item
        8.01. Other Events.
On
        March
        6, 2007, Direct General Corporation (the "Company") issued the press release
        attached hereto as Exhibit 99.1, in which the Company announced that it had
        entered into a Memorandum of Understanding ("MOU") with the plaintiffs to
        settle
        three purported federal shareholder derivative actions filed in the first
        quarter of 2005, which have been consolidated into one action captioned as
In
        Re
        Direct General Corporation Derivative Litigation,
United
        States District Court for the Middle District of Tennessee, No. 3:05-0158
        (the
        "Federal Litigation"). As described below, the Federal Litigation was amended
        to
        add putative class action claims relating to the
Company's
        announcement of its execution of a definitive agreement to merge with Elara
        Holdings, Inc. ("Elara").
Pursuant
        to the terms of the MOU, the defendants will pay an award of attorneys' fees
        and
        expenses of $675,000, and all state and federal derivative and class action
        claims will either be voluntarily dismissed with prejudice or the parties
        in the
        Federal Litigation will take such action as is necessary to have such claims
        dismissed with prejudice. The parties also are negotiating terms that would
        provide the plaintiffs with certain benefits if Elara sells or divests Direct
        General within a certain time after the merger between Elara and Direct General
        closes. The settlement is subject to several conditions, including approval
        by
        the court in which the Federal Litigation is pending.
On
        December 5, 2006, the Company announced its execution of a definitive agreement
        to merge with Elara, an affiliate of Fremont Partners and Texas Pacific Group,
        under which Elara will acquire all of the outstanding common stock of the
        Company (the "Merger"). The Company's Board of Directors, based in large
        part
        upon the unanimous recommendation of the special committee of the Board of
        Directors (the "Special Committee"), approved the acquisition of the Company
        by
        Elara on the terms and subject to the conditions set forth in the merger
        agreement. In the transaction, the Company's shareholders will receive $21.25
        in
        cash for each share of the Company's common stock that they hold. The
        transaction is subject to receipt of shareholder approval and required
        regulatory approvals, as well as satisfaction of other closing conditions.
On
        December 6, 2006, the plaintiffs in the Federal Litigation filed a motion
        for
        leave to amend the complaint to, among other things, add claims relating
        to the
        Merger. The amended complaint alleges, among other things, that the
        consideration to be paid
in
        the
        Merger is unfair and is the result of an unfair process and that the Merger
        was
        agreed to by the Company's directors and officers in order to discharge their
        alleged personal liability. The amended complaint further alleges that the
        Company's directors and officers breached their fiduciary duties by agreeing
        to
        a merger structure that is designed to deter higher offers from other bidders,
        for failing to obtain the highest and best price for the Company's shareholders
        and for structuring the merger so that the individuals would receive undeserved
        change in control benefits, including the immediate vesting of unvested options.
The
        plaintiffs also contested whether the Special Committee members were
        disinterested and whether they had any interests in the Merger separate and
        distinct from the interest of shareholders. If the Merger is approved and
        closed, the Special Committee defendants might have asserted certain defenses
        in
        the Federal Litigation that could have provided a benefit to them separate
        from
        other shareholders. However, given the settlement in principle, all claims
        against such defendants are settled and resolved and will become final with
        court approval.
In
        addition, pursuant to the terms of the MOU, the Company has agreed to provide
        additional information to shareholders by filing such information as exhibits
        to
        this Current Report on Form 8-K. Direct General does not make any admission
        that
        such supplemental disclosures are material. The opinion of SunTrust Robinson
        Humphrey dated February 2, 2007 is attached hereto as Exhibit 99.2. A
        presentation made by SunTrust Robinson Humphrey to the Direct General Board
        of
        Directors on December 4, 2006 is attached hereto as Exhibit 99.3. A presentation
        made by SunTrust Robinson Humphrey to the Direct General Board of Directors
        on
        February 2, 2007 is attached hereto as Exhibit 99.4. SunTrust Robinson
        Humphrey's opinion and the presentation materials were provided to the Special
        Committee and the Board of Directors of Direct General in connection with
        its
        evaluation of the merger consideration to Direct General's shareholders (other
        than affiliates of Elara or the continuing investors). While the presentation
        materials were intended to be a materially accurate representation of the
        information that provided the basis for the opinion, they did not necessarily
        provide the complete basis for any such opinion, were not provided for the
        benefit of the shareholders and should not be relied upon by the shareholders
        in
        making investment decisions. The opinion does not address any other aspect
        of
        the proposed merger, relates only to the fairness, from a financial point
        of
        view, of the merger consideration and does not constitute a recommendation
        to
        any shareholder as to how such shareholder should vote or act with respect
        to
        any matters relating to the Merger.
A
        special
        meeting of the shareholders to consider the Merger is set to occur on March
        8,
        2007 at the Company's corporate headquarters located at 1281 Murfreesboro
        Rd,
        Nashville, Tennessee 37217 at 11:00 am local time.
CAUTIONARY
        NOTE REGARDING FORWARD-LOOKING STATEMENTS
This
        report contains forward-looking statements based on current expectations
        of the
        Company's management. Those forward-looking statements include all statements
        other than those made solely with respect to historical fact. Numerous risks,
        uncertainties and other factors may cause actual results to differ materially
        from those expressed in any forward-looking statements. These factors include,
        but are not limited to, (1) the failure to obtain approval of the Stipulation
        of
        Settlement by the court; (2) a party withdrawing or otherwise terminating
        its
        participation in the MOU; or (3) other factors that are described in the
        Company's filings made with the Securities and Exchange Commission. While the
        Company's management makes projections and estimates in good faith, many of the
        factors that will determine the outcome of the subject matter are beyond
        the
        Company's ability to control or predict. The Company undertakes no obligation to
        revise or update any forward-looking statements, or to make any other
        forward-looking statements, whether as a result of new information, future
        events or otherwise.
Item
        9.01.
Financial
        Statements and Exhibits.
(d)
Exhibits:
Exhibit
                  Number
Description
99.1
Press
                  release issued by Direct General Corporation, dated March 6,
                  2007
99.2
Opinion
                  of SunTrust Robinson Humphrey, dated February 2, 2007
99.3
SunTrust
                  Robinson Humphrey Presentation to the Board of Directors, dated
                  December
                  4, 2006
99.4
SunTrust
                  Robinson Humphrey Presentation to the Board of Directors, dated
                  February
                  2, 2007
SIGNATURE
Pursuant
        to the requirements of the Securities Exchange Act of 1934, the registrant
        has
        duly caused this report to be signed on its behalf by the undersigned thereunto
        duly authorized.
DIRECT
        GENERAL CORPORATION
(Registrant)
By:
/s/
        Ronald F. Wilson
Name:
Ronald
                  F. Wilson
Title:
Secretary
Date:
        March 6, 2007
INDEX
        TO EXHIBITS
Exhibit
                  Number
Description
99.1
Press
                  release issued by Direct General Corporation, dated March 6,
                  2007
99.2
Opinion
                  of SunTrust Robinson Humphrey, dated February 2, 2007
99.3
SunTrust
                  Robinson Humphrey Presentation to the Board of Directors, dated
                  December
                  4, 2006
99.4
SunTrust
                  Robinson Humphrey Presentation to the Board of Directors, dated
                  February
                  2, 2007