EXECUTION COPY
VOTING AGREEMENT
October 15, 2004
To: Cypress Merchant B Partners II (Cayman) L.P.
Cypress Merchant Banking II-A C.V.
Cypress Side-by-Side (Cayman) L.P.
55th Street Partners II (Cayman) L.P.
Scottish Re Group Limited
Dear Sirs:
Re: Securities Purchase Agreement with Scottish Re Group Limited
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In consideration of Cypress Merchant B Partners II (Cayman) L.P.,
Cypress Merchant Banking II-A C.V., Cypress Side-by-Side (Cayman) L.P. and 55th
Street Partners II (Cayman) L.P. (collectively, the "Investors") entering into a
securities purchase agreement dated the date hereof (as the same may be amended
from time to time, the "Securities Purchase Agreement") with Scottish Re Group
Limited (the "Company") relating to the issuance and sale of ordinary shares,
warrants and convertible junior subordinated notes of the Company to the
Investors on the terms and subject to the conditions set forth therein (the
"Transaction"), this letter agreement (this "Agreement") sets out the terms by
which the undersigned shareholder of the Company (the "Shareholder") executing
this Agreement undertakes to take or refrain from taking certain actions in
respect of the Transaction.
The terms of the Transaction are set forth in the Securities Purchase
Agreement, and capitalized terms used herein and not otherwise defined shall
have the meanings set forth in the Securities Purchase Agreement.
1. Representations and Warranties of the Shareholders. The Shareholder
hereby represents and warrants to each of the Investors (and acknowledges that
each of the Investors is relying upon such representations and warranties) as
follows:
a. The ordinary shares, par value US$0.01 per share, of the
Company (the "Ordinary Shares") set forth on Annex I hereto include all
Ordinary Shares held of record, owned by, or for which the Shareholder has
or shares any voting power or power of disposition, provided that any such
shares shall cease to be "Ordinary Shares" from and after such time as such
shares are transferred to the extent permitted by Section 2. The
Shareholder is the legal and beneficial owner, has sole voting power, sole
power of disposition and sole power to agree to all of the matters set
forth in this Agreement with respect to the Ordinary Shares set forth on
Annex I hereto. The Shareholder has good title to the Ordinary Shares set
forth on Annex I hereto, free and clear of all liens, pledges, mortgages
and encumbrances. Other than the Ordinary Shares set forth on Annex I
hereto, no Ordinary Shares or other voting securities of the Company are
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beneficially owned or controlled directly or indirectly by the Shareholder
(other than as may be issued upon exercise of employee stock options), and
the Shareholder does not beneficially own or control directly or indirectly
any other securities having the right to vote with respect to the Special
Resolutions.
b. The Shareholder has the legal capacity (including, if the
Shareholder is a corporation, due corporate authorization) to execute and
deliver this Agreement and to consummate the transactions contemplated
hereby. This Agreement has been duly executed and delivered by the
Shareholder, and, assuming the due authorization, execution and delivery by
each of the Investors, this Agreement constitutes the legal, valid and
binding obligation of the Shareholder, enforceable in accordance with its
terms, except as such enforceability may be affected by bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and other
similar laws relating to or affecting creditors' rights generally and
general equitable principles (whether considered in a proceeding in equity
or at law). If the Shareholder is married, and the Ordinary Shares of the
Shareholder constitute community property or otherwise need spousal or
other approval for this Agreement to be legal, valid and binding, this
Agreement has been duly authorized, executed and delivered by, and
constitutes the legal, valid and binding obligation of, the Shareholder's
spouse, enforceable in accordance with its terms, except as such
enforceability may be affected by bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and other similar laws relating to
or affecting creditors' rights generally and general equitable principles
(whether considered in a proceeding in equity or at law).
c. Neither the execution and delivery of this Agreement by the
Shareholder, the consummation by the Shareholder of the transactions
contemplated hereby nor the compliance by the Shareholder with any of the
provisions hereof shall (i) result in any breach of, or constitute a
default or an event which with notice or lapse of time or both would become
a default (or give rise to any third party right of termination,
cancellation, material modification or acceleration) under any of the
terms, conditions or provisions of any note, loan agreement, bond,
mortgage, indenture, contract, license, agreement, lease, permit or other
instrument or obligation to which the Shareholder is a party or by which
the Shareholder or any of its properties or assets (including the Ordinary
Shares and any options issued by the Company to purchase Ordinary Shares
("Options")) may be bound, (ii) except for filings under U.S. securities
laws, require on the part of the Shareholder any filing with, or permit,
authorization, consent or approval of, any Governmental Authority, (iii)
violate any order, writ, injunction, decree, judgment or law applicable to
the Shareholder or any of its properties or assets, or (iv) conflict with
or result in a default under any provision of the certificate of
incorporation, bylaws or similar organizational documents of the
Shareholder (if not a natural person), excluding from clauses (i), (ii) and
(iii) above such violations, breaches, defaults or failures to make any
filing or to obtain any permit, authorization, consent or approval which
would not, individually or in the aggregate, reasonably be expected to
materially delay or impair the ability of the Shareholder to perform its
obligations under this Agreement.
d. There is no private or governmental Action pending before any
Governmental Authority, or, to the knowledge of the Shareholder, threatened
against the
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Shareholder or any of its properties or any of its officers or directors in
the case of a corporate entity (in their capacities as such) that,
individually or in the aggregate, would reasonably be expected to
materially delay or impair the Shareholder's ability to perform its
obligations under this Agreement. There is no judgment, decree or order
against the Shareholder or, to the knowledge of the Shareholder, any of its
directors or officers in the case of a corporate entity (in their
capacities as such), that would reasonably be expected to materially delay
or impair the Shareholder's ability to perform its obligations under this
Agreement.
2. Transfer Restrictions. The Shareholder hereby covenants and agrees
with each of the Investors that, from the date of this Agreement until the
termination hereof, the Shareholder shall not (a) sell, transfer, gift, assign,
pledge, hypothecate, encumber or otherwise dispose of (any such event, a
"Transfer") any of the Ordinary Shares or Options held by the Shareholder as of
the date hereof or any ordinary shares of the Company received from the exercise
of Options or otherwise acquired after the date hereof by the Shareholder (the
"Additional Ordinary Shares"), or enter into any agreement, arrangement or
understanding in connection therewith (whether by actual disposition or
effective economic disposition due to cash settlement or otherwise), without
having first obtained the prior written consent of the Investors, in each case
other than a Transfer (i) pursuant to an effective registration statement under
the Securities Act of 1933, as amended (the "Securities Act"), or in accordance
with Rule 144 promulgated under the Securities Act, or (ii) to a person who
agrees in writing with the Investors to be bound by the terms and conditions of
this Agreement as if such person were the Shareholder and notice and a copy of
such agreement is concurrently provided to the Investors, or (b) grant any
proxies or powers of attorney (other than those contemplated by this Agreement),
deposit any Ordinary Shares, Options or Additional Ordinary Shares
(collectively, the "Owned Securities") into a voting trust or enter into a
voting agreement, understanding or arrangement with respect to such Owned
Securities.
3. Covenants. The Shareholder hereby undertakes from time to time:
a. to vote (or cause to be voted), in person or by proxy, all the
Ordinary Shares and the Additional Ordinary Shares at any meeting (whether
annual or special and whether or not an adjourned or postponed meeting) of
the shareholders of the Company, however called, and in any action by
written consent of the shareholders of the Company (i) in favor of the
Special Resolutions and any other resolutions for approval of the
Transaction (and any actions required in furtherance thereof), (ii) against
any Competing Transaction and (iii) against any other transaction or action
that could reasonably be expected to materially delay or impede, interfere
with, or discourage the Transaction and against any action that could
reasonably be expected to result in any breach of any representation,
warranty or covenant by the Company in the Securities Purchase Agreement.
Upon the request or direction of any of the Investors, the Shareholder
shall have the Ordinary Shares or any Additional Ordinary Shares counted or
not counted as part of a quorum in connection with any meeting of the
Company's shareholders relating to matters set forth in this Section 3(a);
b. the Shareholder shall not without the prior written consent of
the Investors call or join in a call for any meeting of the shareholders of
the Company for the
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purpose of considering any resolution relating to or which could reasonably
be expected to affect the Transaction; and
c. for greater certainty, in connection with any matter referred
to in Section 3(a)(ii), the Shareholder shall consult with the Investors
prior to exercising any voting rights attached to the Ordinary Shares or
the Additional Ordinary Shares and shall exercise or procure the exercise
of such voting rights as the Investors shall instruct.
4. No Solicitation. The Shareholder (except in his or her capacity as
a director or officer of the Company and only to the extent permitted by the
Securities Purchase Agreement) agrees that, from the date of this Agreement
until the termination hereof, the Shareholder will not, directly or indirectly,
negotiate with, solicit, initiate or encourage submission of proposals or offers
from, provide information to, or otherwise knowingly take any action to
facilitate or assist, any Third Party with respect to a Competing Transaction.
5. Capacity as Director or Officer. The Shareholder is signing this
Agreement solely in his or her capacity as the legal and beneficial owner of the
Shareholder's Ordinary Shares. Nothing in this Agreement shall be construed to
prohibit a Shareholder who is a member of the Board of Directors or an officer
of the Company or any subsidiary of the Company from taking any action or
failing to take any action in such capacity in accordance with his or her
fiduciary duties to the Company or such subsidiary or otherwise at the direction
of the board of directors of the Company or such subsidiary.
6. Disclosure. The Shareholder hereby irrevocably agrees and consents
to the details of this Agreement being set out in any proxy statement or other
required public filing produced by the Company or the Investors in connection
with the Transaction.
7. Time of the Essence. Any date, time or period referred to in this
Agreement shall be of the essence except to the extent to which the Investors
and the Shareholder agree in writing to vary any date, time or period, in which
event the varied date, time or period shall be of the essence.
8. Specific Performance. The Shareholder agrees that monetary damages
would not be an adequate remedy for any loss incurred by reason of a breach of
this Agreement by the Shareholder and hereby agrees to waive the defense in any
action for specific performance that a remedy at law would be adequate.
9. Waiver; Amendment. Each party hereto agrees and confirms that:
a. any provision of this Agreement may be amended or waived if,
and only if, such amendment or waiver is in writing and signed, in the case
of an amendment, by the Shareholder and the Investors or in the case of a
waiver, by the party against whom the waiver is to be effective; and
b. no failure or delay by any party in exercising any right,
power or privilege hereunder shall operate as a waiver thereof nor shall
any single or partial exercise thereof preclude any other or further
exercise.
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10. Integration. This Agreement constitutes the entire agreement among
the parties with respect to the subject matter hereof and supersedes all prior
agreements and understandings among the parties with respect thereto.
11. Termination. This Agreement and the obligations of the parties
hereunder shall terminate upon the earliest to occur of: (a) the Shareholder
Approval having been duly obtained; (b) the Securities Purchase Agreement having
been terminated pursuant to Article IX thereof prior to the Closing Date; or (c)
the second anniversary of the date of this Agreement. Upon termination, this
Agreement will become null and void and of no effect with no liability on the
part of any party hereto, and all proxies granted hereby will be automatically
revoked; provided, however, that no such termination will relieve any party
hereto from any liability for any breach of this Agreement occurring prior to
such termination.
12. Reliance. No representation, warranty, inducement, promise,
understanding or condition not set forth in this Agreement has been made or
relied upon by any of the parties to this Agreement. Except for the express
representations and warranties contained in this Agreement, none of the parties
hereto makes any representations or warranties, written or oral, statutory,
express or implied, concerning itself or any of its affiliates, or its or its
affiliates' respective businesses, assets or liabilities.
13. Representations and Warranties of the Investors. Each Investor
represents and warrants to the Shareholder that this Agreement has been duly
executed and delivered by such Investor, and, assuming the due authorization (if
the Shareholder is a corporation), execution and delivery by the Shareholder,
and the due authorization, execution and delivery by the other Investors, this
Agreement constitutes the legal, valid and binding obligation of such Investor,
enforceable in accordance with its terms, except as such enforceability may be
affected by bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors' rights
generally and general equitable principles (whether considered in a proceeding
in equity or at law).
14. Notices. All notices and other communications hereunder shall be
in writing and shall be deemed duly given (a) on the date of delivery if
delivered personally, (b) on the first business day following the date of
dispatch if delivered by a nationally recognized next-day courier service, (c)
on the fifth business day following the date of mailing if delivered by
registered or certified mail, return receipt requested, postage prepaid or (d)
if sent by facsimile transmission, when transmitted and receipt is confirmed.
All notices hereunder shall be delivered as set forth below, or pursuant to such
other instructions as may be designated in writing by the party to receive such
notice:
If to any of the Investors, to:
c/o The Cypress Group L.L.C.
00 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxx X. Xxxxxxx
Facsimile: (000) 000-0000
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with a copy to:
Xxxxxxx Xxxxxxx & Xxxxxxxx LLP
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxx Xxxxxxxx
Fax: (000) 000-0000
If to the Shareholder, to the address or fax number set forth on the
signature page below the Shareholder's name.
15. Severability. Any term or provision of this Agreement that is
invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdiction. If any provision of this
Agreement is so broad as to be unenforceable, the provision shall be interpreted
to be only so broad as is enforceable.
16. Assignment; No Third-Party Beneficiaries. Neither this Agreement
nor any of the rights, interests or obligations hereunder shall be assigned by
any of the parties (whether by operation of law or otherwise) without the prior
written consent of the other party, except that each Investor may assign,
delegate or otherwise transfer any of its rights, interests or obligations under
this Agreement to an affiliate of such Investor without the consent of the
Shareholder, and the Shareholder may Transfer Ordinary Shares or Options in
accordance with Section 2 hereof without the consent of the Investors. This
Agreement shall be binding upon and shall inure to the benefit of the parties
and their respective successors and permitted assigns. Notwithstanding anything
contained in this Agreement to the contrary, nothing in this Agreement,
expressed or implied, is intended to confer on any person other than the parties
or their respective successors and assigns any rights, remedies, obligations or
liabilities under or by reason of this Agreement.
17. Governing Law; Consent to Jurisdiction and Services of Process;
Waiver of Jury Trial.
(a) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
(b) Each party to this Agreement hereby irrevocably and
unconditionally, with respect to any matter or dispute arising under, or in
connection with, this Agreement:
(i) submits for itself and its property in any Action relating to
this Agreement, or for recognition and enforcement of any judgment in
respect thereof, to the exclusive general jurisdiction of the courts
of the State of New York, the courts of the United States of America
for the Southern District of New York, and appellate courts from any
thereof (and covenants not to commence any Action in any other venue
or jurisdiction);
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(ii) consents that any such Action may be brought in such courts
and waives any objection that it may now or hereafter have to the
venue of any such Action in any such court or that such Action was
brought in an inconvenient court and agrees not to plead or claim the
same;
(iii) agrees that service of process in any such Action will be
in accordance with the Laws of the State of New York;
(iv) waives in connection with any such Action any and all rights
to a jury trial; and
(v) agrees that nothing herein shall affect the right to effect
service of process in any other manner permitted by Law.
18. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall contribute one and the same instrument. Delivery of an executed
counterpart of a signature page to this Agreement by facsimile shall be
effective as delivery of a manually executed counterpart of this Agreement.
19. Covenants of the Company. The Company hereby agrees to take all of
the actions required under Sections 6.9 and 6.10 of the Securities Purchase
Agreement. The Company agrees and covenants that it shall not, and shall direct
its transfer agent not to, register the transfer of any Ordinary Shares or
Additional Ordinary Shares except in accordance with the provisions of Section
2.
This Voting Agreement has been agreed and accepted by each of the
undersigned this 15th day of October, 2004.
Pacific Life Insurance Company
By: /s/ Xxxxx X. Xxxx
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Name: Xxxxx X. Xxxx
Address: 000 Xxxxxxx Xxxxxx Xxxxx
Xxxxxxx Xxxxx, XX 00000
Fax: (000) 000-0000
By: /s/ Xxxxxx X. Milfs
-------------------------------------
Name: Xxxxxx X. Milfs
Address: 000 Xxxxxxx Xxxxxx Xxxxx
Xxxxxxx Xxxxx, XX 00000
Fax: (000) 000-0000
Accepted and Agreed:
SCOTTISH RE GROUP LIMITED
By: /s/ Xxxx Xxxxxxx
------------------------------------
Name: Xxxx Xxxxxxx
Title: Executive Vice President and
General Counsel
Voting Agreement - Pacific Life Insurance Company
Accepted and Agreed:
CYPRESS MERCHANT B PARTNERS
II (CAYMAN) L.P.
By: Cypress Associates II (Cayman) L.P., its general partner
By: CMBP II (Cayman) Ltd., its general partner
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Director
CYPRESS MERCHANT BANKING II-A C.V.
By: Cypress Associates II (Cayman) L.P., its managing
general partner
By: CMBP II (Cayman) Ltd., its general partner
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Director
CYPRESS SIDE-BY-SIDE (CAYMAN) L.P.
By: Cypress Associates II (Cayman) L.P., its general partner
By: CMBP II (Cayman) Ltd., its general partner
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Director
55TH STREET PARTNERS II (CAYMAN) L.P.
By: Cypress Associates II (Cayman) L.P., its general partner
By: CMBP II (Cayman) Ltd., its general partner
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Director
Voting Agreement - Pacific Life Insurance Company
Annex I
Shareholder Name Number of Ordinary Shares
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