Filed by PXRE Group Ltd.
pursuant to Rule 425
under the Securities Act of 1933 and
deemed filed pursuant to Rule 14a-12
under the Securities Exchange Act of 1934
Subject Company: Argonaut Group, Inc.
Commission File No. 333-142568
Contact: Investors:
PXRE Group Ltd. Sard Verbinnen & Co
Robert P. Myron Jamie Tully/Lesley Bogdanow
Chief Financial Officer 212-687-8080
441-296-5858 jtully@sardverb.com
bob.myron@pxre.com
PXRE GROUP LTD. [NEWS RELEASE LOGO]
PXRE House [PXRE LOGO]
110 Pitts Bay Road, Pembroke HM 08
Bermuda
441 296 5858
441 296 6162 FAX
PXRE ANNOUNCES RECORD DATE AND MEETING DATE FOR
SPECIAL MEETING OF SHAREHOLDERS
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HAMILTON, Bermuda -- May 24, 2007 -- PXRE Group Ltd. (NYSE: PXT) ("PXRE")
today announced that it has scheduled a special meeting of shareholders to
consider and vote on the issuance of common shares of PXRE and the other
transactions contemplated by the previously announced agreement and plan of
Merger by and among PXRE, PXMS Inc. and Argonaut Group, Inc. dated as of March
14, 2007.
The special meeting will be held on Wednesday, July 25, 2007, at 10:30 am
Atlantic Time / 9:30 am Eastern Time, at PXRE House, 110 Pitts Bay Road,
Pembroke, HM 08, Bermuda. PXRE's shareholders of record at the close of regular
trading on the New York Stock Exchange on Monday, June 4, 2007, will be entitled
to notice of and to vote at the special meeting. A definitive proxy statement
for the special meeting will be mailed to shareholders of record beginning on or
about June 8, 2007.
ABOUT PXRE GROUP LTD.
PXRE - with operations in Bermuda, Europe and the United States - provides
reinsurance products and services to a worldwide marketplace. PXRE's primary
focus is providing property catastrophe reinsurance and retrocessional coverage.
PXRE also provides marine, aviation and aerospace products and services. PXRE's
common shares trade on the New York Stock Exchange under the symbol "PXT."
To request other printed investor material from PXRE or additional copies
of this news release, please contact Jamie Tully or Lesley Bogdanow at Sard
Verbinnen & Co, (212) 687-8080 or visit www.PXRE.com.
WHERE TO FIND ADDITIONAL INFORMATION ABOUT THE PROPOSED MERGER TRANSACTION
In connection with the proposed merger transaction between PXRE and
Argonaut Group, Inc., PXRE has filed with the SEC a registration statement on
Form S-4 which contains a preliminary joint proxy statement/prospectus. The
registration statement on Form S-4 has not been declared effective by the SEC.
Investors and shareholders of PXRE and Argonaut Group, Inc. are urged to read
the definitive joint proxy statement/prospectus (including any amendments or
supplements thereto) and any other relevant materials regarding the proposed
merger transactions (when they become available) because they contain or will
contain important information about PXRE, Argonaut Group, Inc. and the proposed
merger transaction. The definitive joint proxy statement/prospectus and other
relevant materials (when they become available), and any other documents filed
by PXRE with the SEC, may be obtained free of charge at the SEC's web site at
http://www.sec.gov. In addition, investors and shareholders may obtain free
copies of the documents filed with the SEC by PXRE by directing a written
request to PXRE Group Ltd., Attention: Robert P. Myron, Chief Financial Officer,
PXRE House, 110 Pitts Bay Road, Pembroke, HM 08 Bermuda or by calling
441-296-5858. Investors and shareholders are urged to read the definitive joint
proxy statement/prospectus and any other relevant materials (when they become
available) before making any voting or investment decisions with respect to the
proposed merger transaction. This press release shall not constitute an offer to
sell or the solicitation of an offer to buy any securities, nor shall there be
any sale of securities in any jurisdiction in which such offer, solicitation or
sale would be unlawful prior to registration or qualification under the
securities laws of any such jurisdiction. No offering of securities shall be
made except by means of a prospectus meeting the requirements of Section 10 of
the Securities Act of 1933, as amended.
PARTICIPANTS IN THE SOLICITATION
PXRE and its directors and executive officers and Argonaut Group, Inc. and
its directors and executive officers may be deemed to be participants in the
solicitation of proxies from the shareholders of PXRE and Argonaut Group, Inc.
in connection with the proposed merger transaction. Information regarding the
special interests of these directors and executive officers in the proposed
merger transaction is included in the preliminary joint statement/prospectus
referred to above and will be included in the definitive joint proxy
statement/prospectus (when it becomes available).
FORWARD LOOKING STATEMENTS
Statements in this release that are not strictly historical are
forward-looking and are based upon current expectations and assumptions of
management. Statements included herein, as well as statements made by or on
behalf of PXRE in its communications and discussions with investors and analysts
in the normal course of business through meetings,
phone calls and conference calls, which are not historical in nature are
intended to be, and are hereby identified as, "forward-looking statements" for
purposes of the safe harbor provided by Section 21E of the Securities Exchange
Act of 1934 as amended. These forward-looking statements, identified by words
such as "intend," "believe," "anticipate," or "expects" or variations of such
words or similar expressions are based on current expectations, speak only as of
the date thereof, and are subject to risk and uncertainties. In light of the
risks and uncertainties inherent in all future projections, the forward-looking
statements in this report should not be considered as a representation by us or
any other person that the Company's objectives or plans will be achieved. The
Company cautions investors and analysts that actual results or events could
differ materially from those set forth or implied by the forward-looking
statements and related assumptions, depending on the outcome of certain
important factors including, but not limited to, the following: (i) we face
risks related to our proposed merger with Argonaut; (ii) if the merger with
Argonaut is not completed, unless the Board of Directors identifies and
implements a different operating strategic solution, we will not write or earn
any material premiums in the future and, as a result, we expect to incur
material operating losses since our remaining revenue is insufficient to cover
our projected operating and other expenses; (iii) if the merger is not
consummated, we may not be able to identify or implement a strategic alternative
for PXRE; (iv) if the merger is not consummated and our Board of Directors
concludes that no other feasible strategic alternative would be in the best
interests of our shareholders, it may determine that the best course of action
is to place the reinsurance operations of PXRE into runoff and eventually
commence an orderly winding up and liquidation of PXRE operations over some
period of time that is not currently determinable; (v) if the merger is not
consummated and the Board of Directors elects to pursue a strategic alternative
that does not involve the continuation of meaningful property catastrophe
reinsurance business, there is a risk that the Company could incur additional
material charges or termination fees in connection with our collateralized
catastrophe facility and certain multiyear ceded reinsurance agreements; (vi)
our ability to continue to operate our business, consummate the merger and to
identify, evaluate and complete any other strategic alternative is dependent on
our ability to retain our management and other key employees, and we may not be
able to do so; (vii) adverse events in 2006 negatively have affected the market
price of our common shares, which may lead to further securities litigation,
administrative proceedings or both being brought against us; (viii) reserving
for losses includes significant estimates, which are also subject to inherent
uncertainties; (ix) because of potential exposure to catastrophes in the future,
our financial results may vary significantly from period to period; (x) we
operate in a highly competitive environment and no assurance can be given that
we will be able to compete effectively in this environment; (xi) reinsurance
prices may decline, which could affect our profitability; (xii) we may require
additional capital in the future; (xiii) our investment portfolio is subject to
significant market and credit risks which could result in an adverse impact on
our financial position or results; (xiv) we have exited the finite reinsurance
business, but claims in respect of finite reinsurance could have an adverse
effect on our results of operations; (xv) our reliance on
reinsurance brokers exposes us to their credit risk; (xvi) we may be adversely
affected by foreign currency fluctuations; (xvii) retrocessional reinsurance
subjects us to credit risk and may become unavailable on acceptable terms;
(xviii) we have exhausted our retrocessional coverage with respect to Hurricane
Katrina, leaving us exposed to further losses; (xix) recoveries under our
collateralized facility are triggered by modeled loss to a notional portfolio,
rather than our actual losses arising from a catastrophe event, which creates a
potential mismatch between the risks assumed through our inwards reinsurance
business and the protection afforded by this facility; (xx) our inability to
provide the necessary collateral could affect our ability to offer reinsurance
in certain markets; (xxi) the insurance and reinsurance business is historically
cyclical, and we may experience periods with excess underwriting capacity and
unfavorable premium rates; conversely, we may have a shortage of underwriting
capacity when premium rates are strong; (xxii) regulatory constraints may
restrict our ability to operate our business; (xxiii) any determination by the
United States Internal Revenue Service ("IRS") that we or our offshore
subsidiaries are subject to U.S. taxation could result in a material adverse
impact on the our financial position or results; and (xxiv) any changes in tax
laws, tax treaties, tax rules and interpretations could result in a material
adverse impact on our financial position or results. In addition to the factors
outlined above that are directly related to PXRE's business, PXRE is also
subject to general business risks, including, but not limited to, adverse state,
federal or foreign legislation and regulation, adverse publicity or news
coverage, changes in general economic factors, the loss of key employees and
other factors set forth in PXRE's SEC filings. The factors listed above should
not be construed as exhaustive. Therefore, actual results or outcomes may differ
materially from what is expressed or forecasted in such forward-looking
statements. PXRE undertakes no obligation to update any forward-looking
statements, whether as a result of new information, future events (including
catastrophe events), or otherwise.
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