UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the Registrant [X]
Filed by a Party other than Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, For Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
[ ] Definitive Proxy Statement
[X ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to ss. 240.14a-12
SCOTTISH RE GROUP LIMITED
(Name of Registrant as Specified in Its Charter)
Not Applicable
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X ] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11
1. Title of each class of securities to which transaction applies:
2. Aggregate number of securities to which transaction applies:
3. Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
4. Proposed maximum aggregate value of transaction:
5. Total fee paid:
[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration
statement number, or the form or schedule and the date of its filing.
1. Amount previously paid:
2. Form, Schedule or Registration Statement No.:
3. Filing Party:
4. Date Filed:
[LOGO]
*** URGENT ATTENTION REQUESTED ***
Dear Fellow Shareholder,
You should have previously received proxy material in connection with the
upcoming Extraordinary General Meeting of Shareholders of Scottish Re Group
Limited to be held on February 23, 2007 at the Fairmont Hamilton Princess Hotel
in Hamilton, Bermuda at 11:00 A.M. local time.
At this important meeting, you will be asked to vote on a set of proposals
relating to the proposed investment in Scottish Re by MassMutual Capital
Partners LLC ("MassMutual Capital"), a member of the MassMutual Financial Group,
and an affiliate of Cerberus Capital Management, L.P. ("Cerberus"), who we refer
to as the "Investors" in the proxy materials. As described in the proxy
statement that was previously mailed to shareholders on or about January 22,
2007, before approving this transaction, our board of directors carefully
considered a number of factors, including that an exhaustive auction process to
solicit potential bidders was undertaken and that the alternatives of run-off
and bankruptcy likely would result in significantly less value to shareholders.
Based on these considerations, our board of directors unanimously recommends
that shareholders approve this transaction.
In the event that Scottish Re is not able to complete the transaction with the
Investors, including as a result of a failure to obtain the required shareholder
approvals, our liquidity position, financial condition and our business would be
materially adversely affected. Although we would attempt to enter into an
alternative transaction that would provide us with the liquidity and capital
needed to manage our business, we cannot assure you that we would succeed in
entering into such a transaction, and based upon the process described in the
proxy statement that we conducted in evaluating our strategic alternatives, we
believe that it is unlikely that we would be able to obtain a superior offer
from someone other than the Investors or to enter into such a transaction on a
timely basis.
In particular, we believe that a failure to complete this transaction would
likely result in:
o further downgrades in our credit ratings and the financial strength
ratings of our operating subsidiaries;
o termination of the amended forbearance agreement with HSBC Bank USA,
N.A. and demands from it for additional collateral pursuant to the terms
of the collateral finance facilities that we entered into with it in
2004 and December 2005;
o the loss of services of some of our key employees;
o an inability by us to attract new employees with the skills needed to
manage our existing business;
o regulatory action against us under applicable insurance laws; and
o the likelihood of customers terminating or recapturing ceded business.
Moreover, in the event that our shareholders fail to approve the transaction
with the Investors:
o Cerberus would not be required to provide us the $100.0 million term
loan facility agreed to on November 26, 2006 and Citigroup Global
Markets Inc.; and
o Calyon Securities (USA) Inc. would not be required to enter into the
$500.0 million collateral finance facility agreed to on November 26,
2006.
As a consequence of the above, if we were unable to promptly arrange
satisfactory alternative financing, we believe it may become necessary for us to
seek protection from our creditors under applicable bankruptcy and insolvency
laws in the jurisdictions where we and our operating subsidiaries are domiciled,
or one or more of our regulators may seek to intervene in the operations of our
operating company subsidiaries. We believe bankruptcy is likely to provide
significantly less value and certainty to shareholders than the Issuance.
AS SUCH, YOUR BOARD OF DIRECTORS HAS CAREFULLY CONSIDERED EACH OF THE PROPOSALS
AND UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE FOR THE PROPOSALS.
According to our latest records, your voting instructions for this meeting have
not yet been received. Regardless of the number of shares you may own, it is
important they be represented at the meeting. If you do not vote, the effect
will be a vote against the transaction. We urge you to please return your proxy
card in the enclosed Business Return Envelope, or vote by following the
instructions for phone or internet voting that appear on the enclosed proxy
card.
Thank you for your support. Your prompt voting may save Scottish Re the
necessity and expense of further solicitations.
Sincerely,
/s/ Paul Goldean
Paul Goldean
President and Chief Executive Officer