Exhibit 10.70
 EXECUTION VERSIONJune 30, 2008
 CONFIDENTIAL
 VIA FEDERAL EXPRESS AND ELECTRONIC MAIL
 
 Ballantyne Re Reinsurance Transaction
  Letter Scottish
Re ING Ballantyne SRUS Ballantyne
Reinsurance Agreement
 March 31 LOI
 1.
    
    June 30th Recapture.
 (a)
    
    In accordance with Section 4.2(c) of the Coinsurance Agreement effective April
1, 2006, as amended and restated effective March 31, 2008 (the SLD Coinsurance
Agreement), by and among Security Life of Denver Insurance Company
(SLD) and SRUS, SLD hereby irrevocably consents to the voluntary recapture,
effective as of June 30, 2008, of a pro rata portion of the liabilities (other than
liabilities attributable to claims pending as of June 30, 2008 and claims incurred but
not reported as of June 30, 2008) under the Defined Block Business (as defined in the




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Ballantyne Reinsurance Agreement) arising under the policies that are included in
the Defined Block Business (the June 30th Ballantyne Recapture
and the portion of the business so recaptured, the June 30th
Ballantyne Recaptured Business). Scottish Re shall ensure that June
30th Excess Reserves (as defined below) (measured as of June 30, 2008)
do not exceed $200,000,000.
 (b)
    
    Pursuant to the Ballantyne Reinsurance Agreement, in consideration for the
June 30th Ballantyne Recapture, Ballantyne has the obligation to pay to
SRUS, in accordance with Section 10.5.1 of the Ballantyne Reinsurance Agreement, an
amount equal to the sum of (i) 92.5% of the Economic Reserves attributable to the June
30th Ballantyne Recaptured Business, less (ii) the Loss Carryforward Balance,
less (iii) the Recapture Fee (the June 30th Ballantyne Recapture
Consideration). SRUS shall withdraw the June 30th Ballantyne
Recapture Consideration from the Reinsurance Trust Account and deposit such amount
into the SRUS Account (as defined in the Ballantyne Reinsurance Agreement).(c)
    
    Immediately following the consummation of the June 30th Ballantyne
Recapture, subject to the limitations described in this Letter, Scottish Re and ING
shall execute the following transactions (collectively, the June 30th Recapture
and Reinsurance Transactions and together with the June 30th
Ballantyne Recapture, the June 30th Recapture) effective as of
June 30, 2008, which transactions shall occur effectively simultaneously but in the
following sequence:
 (i)
    
    SLD shall recapture from SRUS the same percentage of the
Reinsured Liabilities (as defined in the SLD Coinsurance Agreement) as the
percentage of the Defined Block Business recaptured by SRUS in the June 30
Ballantyne Recapture (the June 30th SLD Recaptured
Business) pursuant to a recapture agreement and an amendment to the SLD
Coinsurance Agreement in exchange for consideration from SRUS to SLD in an
amount equal to the economic reserves (measured as of June 30,2008) associated with the June 30th SLD Recaptured Business as
determined in accordance with the methodology used by SLD and Scottish Re to
determine the portion of the U.S. statutory reserves associated with the
business ceded by SLD to Security Life of Denver International Ltd.
(SLDI) that SLD maintains in the segregated account (the ING Re
Segregated Account) SLD established pursuant to Section 5.25 of the APA
(as defined below) (the economic reserves associated with the June
30th SLD Recaptured Business, as so calculated, the June
30th SLD Economic Reserves). The June 30th SLD Economic
Reserves shall be withdrawn from the SRUS Account and deposited and maintained
in the ING Re Segregated Account on a modified coinsurance and/or funds
withheld coinsurance basis. The assets
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constituting the June 30th SLD Economic Reserves to be
transferred to the ING Re Segregated Account shall be reasonably
acceptable to SLD. With respect to the excess, if any, of the June 30th
Ballantyne Recapture Consideration over the June 30th SLD Economic
Reserves (the June 30th Excess Ballantyne Recapture
Consideration), SRUS shall transfer such excess from the SRUS Account
as follows: (i) SRUS shall remit 50% of the June 30th Excess
Ballantyne Recapture Consideration to Ballantyne Re, as a consent fee, for
deposit into the economic reserve subaccount of the Reinsurance Trust
Account and (ii) SRUS shall be entitled to deposit the remainder of the
June 30th Excess Ballantyne Recapture Consideration in any
account of SRUS it so chooses and shall be entitled to retain and apply
such amount as it elects in its sole discretion. For purposes of this
Letter, APA means the Asset Purchase Agreement, dated as of
October 17, 2004, by and among Scottish Re Group Limited, SRUS, SLD, SLDI
and Scottish Re Life (Bermuda) Limited (SRLB);(ii)
    
    SLD shall cede the June 30th SLD Recaptured Business to SLDI
pursuant to amendments to (a) the Second Amendment and Restatement (Effective
December 31, 2004) to the Reinsurance Agreement (Effective July 1, 2001)
(Agreement Number 0900 2774) and (b) the Second Amendment and Restatement
(Effective December 31, 2004) to the Reinsurance Agreement (Effective July 1,
2001) (Agreement Number 0900 2962), each entered into by and between SLD and
SLDI, and in accordance with the security arrangements described below;(iii)
    
    SLDI shall have the right, but not the obligation, to cede
the June 30th SLD Recaptured Business to SRLB in accordance with amendments to
the Coinsurance/Modified Coinsurance Agreement (Treaty Number 5040) and the
Coinsurance Funds Withheld Agreement (Treaty Number 5041); and(iv)
    
    SRLB shall cede the June 30th SLD Recaptured Business to (i)
Scottish Annuity & Life Insurance Company (Cayman) Ltd. or Scottish Re
(Dublin) Limited (SR Dublin) or (ii) with the consent of ING (such
consent not to be unreasonably withheld), any other affiliate of SRLB.
 (d)
    
    SLDI shall provide or cause the provision of one or more letters of credit in
order to provide SLD with statutory financial statement credit for the excess of the
U.S. statutory reserves associated with the June 30th SLD Recaptured Business over the
June 30th SLD Economic Reserves (the June 30th Excess Reserves)
(such letters of credit, the June 30th Letters of Credit).
Scottish Re shall bear the costs of the June 30th Letters of Credit by
paying to SLD a facility fee based on the face amount of the
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June 30th Letters of Credit outstanding as of the end of the preceding
calendar quarter (the June 30th Recapture Covered Amount)
equal to 0.85% for calendar year 2008, 1.05% for calendar year 2009 and 1.25% for
all calendar years thereafter (calculated on a per annum basis) multiplied by the
June 30th Recapture Covered Amount (the June 30 LOC Fee). If
a definitive and binding agreement for the ING Business Transaction (as defined in
the March 31 LOI) is not executed on or before December 31, 2008, Scottish Re
agrees that as of January 1, 2009, the applicable rate then in effect for the June
30LOC Fee and for each calendar year thereafter shall be increased to
1.75% (the Step-Up June 30 LOC Rate). If a definitive and binding
agreement for the ING Business Transaction is executed on or before December 31,
2008 but the ING Business Transaction is not consummated on or before April 30,
2009, Scottish Re agrees that as of May 1, 2009, the June 30 LOC Fee then in effect
and for all periods thereafter shall be calculated based on the Step-Up June 30
Rate.(e)
    
    Notwithstanding anything to the contrary in this Section 1, if (i) ING
reasonably believes (based upon an adverse change in SRUS condition following the
execution of this Letter, taking into account the financial and other information
concerning SRUS disclosed or made available to ING prior to the execution of this
Letter) that, after giving effect to the June 30th Recapture, (A) SRUS is
likely to be declared insolvent by SRUS domiciliary insurance regulator, (B) a
conservation, liquidation, rehabilitation, reorganization or similar proceeding is
likely to be commenced against SRUS by its domiciliary insurance regulator, or (C)
SRUS is likely to lose its accreditation as a reinsurer in New York or Colorado, in
each case at any time prior to the date that is two (2) months following the date on
which SLD is required to file its next statutory financial statement or (ii) the New
York Insurance Department or the Colorado Insurance Division informs ING that the
accredited reinsurer status of SRUS will be revoked or the Delaware Insurance
Department informs ING that it will declare SRUS insolvent or will commence a
conservation, liquidation, rehabilitation, reorganization or similar proceeding
against SRUS, then ING shall be entitled, upon written notice to SRUS, to revoke its
consent to the June 30 Recapture.(f)
    
    The parties hereto acknowledge and agree that SRUS intends to report late
reported policies to Ballantyne (as addressed in Section 7.5 of the Ballantyne
Reinsurance Agreement) after giving effect to the June 30th Ballantyne
Recapture, and accordingly no portion of such late reported policies will be
recaptured pursuant to the June 30th Ballantyne Recapture, but SLD will
recapture from SRUS a portion of such policies, and such portion will be reinsured,
both as described in clauses (i) through (iv) of Section 1(c) of this Letter.
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(g)
    
    For the avoidance of doubt, except as specifically provided herein the terms
and conditions of the March 31 LOI shall not apply to the June 30th
Recapture.
 2.
    
    Amendments to March 31 LOI. The parties to the March 31 LOI (including without
limitation SR Dublin) hereby agree to amend the March 31 LOI as set forth in this Section 2.
 (a)
    
    Section 1(d) of the March 31 LOI is hereby amended by deleting clause (C)
thereto in its entirety, and the existing clauses (D) and (E) of Section 1(d) of the
March 31 LOI are hereby re-designated as clauses (C) and (D), respectively, of Section
1(d).(b)
    
    Section 3 (Assignment and Assumption Transaction) of the March 31 LOI is
hereby amended and restated in its entirety as follows:
 (a)
    
    The parties agree promptly to effect, following the
completion of the first Recapture and Reinsurance Transaction, an assignment
from SRUS to SLD, and the assumption by SLD, of all of SRUS rights and
obligations under the Ballantyne Reinsurance Agreement, the Reinsurance Trust
Agreement (as defined in the Ballantyne Reinsurance Agreement), with the
effect that SLD shall be substituted for SRUS, in SRUS name, place and stead,
as the ceding company under the Ballantyne Reinsurance Agreement and as the
beneficiary of the Reinsurance Trust Account so as to effect a novation of the
Ballantyne Reinsurance Agreement, such that SRUS is fully and finally released
of all of its liabilities and obligations under such agreements, the SLD
Coinsurance Agreement and the Control Agreement (as defined in the Ballantyne
Reinsurance Agreement) (the Assignment and Assumption Transaction).
In furtherance of the foregoing, Scottish Re and ING shall negotiate
definitive documentation and use their respective reasonable best efforts to
obtain all necessary regulatory, shareholder and third party consents and
approvals in order to enter into the Assignment and Assumption Transaction
with an effective date not later than June 30, 2008.(b)
    
    ING and Scottish Re hereby agree that the terms of the
Assignment and Assumption Transaction shall provide that SLD shall have the
right to recapture from Ballantyne, at any time and from time to time, a
pro-rata portion of the business reinsured by Ballantyne, but only to the
extent that SLD determines, acting reasonably and in good faith, that it is
reasonably likely that, in the absence of such a recapture, the Security
Balance as of any date of determination will not exceed the Required Balance
(both as defined in the Ballantyne Reinsurance Agreement) as of such date. If
SLD recaptures business from Ballantyne Re as described in the
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immediately preceding sentence and cedes such business to SLDI (i) SLDI
shall have the right, but not the obligation, to retrocede such business
to SRLB or to another affiliate of Scottish Re selected by Scottish Re and
reasonably acceptable to SLDI on an economic basis consistent with the
treatment of the cessions by SLDI in the Recapture and Reinsurance
Transactions effected pursuant to this Letter, (ii) SLD shall use the
recapture payment it receives from Ballantyne to fund the ING Re
Segregated Account for the economic reserves required to be held therein
(and Scottish Re shall not be required to reimburse SLD for the amount of
such deposit), and (iii) if the amount of the recapture payment SLD
receives from Ballantyne exceeds the amount needed to fund the ING Re
Segregated Account with respect to the recaptured business, SLD and SRUS
shall cause the excess to be deposited into a trust account reasonably
satisfactory to SLD and SRUS (except that SRUS or an affiliate it selects
shall be the grantor of such trust) and treated in the same manner as the
Excess Ballantyne Recapture Consideration as described in the third
sentence of Section1(b)(i)of this Letter. In such case Scottish Re
shall bear the costs of any letters of credit obtained by SLDI to support
the business so recaptured in accordance with thisSection 3(b)(such
letters of credit, the Post-Assignment Letters of Credit) by
paying to SLD a facility fee based on the face amount of the
Post-Assignment Letters of Credit outstanding as of the end of the
preceding calendar quarter (the Post-Assignment LOC Covered
Amount) equal to 0.85% for calendar year 2008, 1.05% for calendar
year 2009 and 1.25% for all calendar years thereafter (calculated on a per
annum basis) multiplied by the Post-Assignment LOC Covered Amount. For
greater certainty, Scottish Res obligation to pre-fund letter of credit
fees as set forth inSection 1(c)of this Letter, and Scottish Res
obligation to pay stepped-up letter of credit fees as set forth in Section
1(d) of this Letter, shall not apply to the Post-Assignment Letters of
Credit.(c)
    
    ING further agrees to indemnify Scottish Re, in accordance
with the indemnification procedures set forth in the APA, for any Losses (as
defined in the APA) incurred by Scottish Re as a result of any breach or
asserted breach or violation or asserted violation of any representation,
warranty or covenant or other promise or obligation of Scottish Re made to
Ambac UK, Assured UK or any other party (other than ING) in connection with
the Ballantyne Purchaser Facility (as defined in the SLD Coinsurance
Agreement), if and to the extent that such Loss arises out of INGs breach of
any of its covenants, promises or obligations set forth in the Ballantyne
Reinsurance Agreement, the Reinsurance Trust Agreement or any other agreement
entered into by ING in connection with the Assignment and Assumption
Transaction (in
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each case taking into account any amendments to such agreements entered
into as a result of the Assignment and Assumption Transaction).
 (d)
    
    Scottish Re hereby acknowledges and agrees that,
notwithstanding the consummation of the Assignment and Assumption Transaction
in accordance with this Section 3, Scottish Re shall continue to administer
the business ceded to Ballantyne in accordance with the terms of the
Administrative Services Agreement (as defined in the APA), except that the
Administrative Services Agreement shall be amended concurrently with the
consummation of the Assignment and Assumption Transaction as may be reasonably
necessary in order to take into account the effects of the Assignment and
Assumption Transaction.
 (c)
    
    Except as amended by this Letter, the March 31 LOI remains in full force and
effect, without modification or amendment.
 3.
    
    Taxes. Scottish Re shall indemnify ING for any and all Losses related to Taxes (as
defined in the APA) imposed upon ING resulting from the transactions contemplated under this
Letter, but excluding Losses related to any Taxes (a) resulting from income generated by ING
as a result of the transactions contemplated by this Letter, (b) imposed by a foreign
governmental authority or foreign Tax Authority (as defined in the APA) or (c) resulting from
any actions of ING other than actions taken in accordance with and pursuant to the definitive
agreements executed and performed in connection with the transactions contemplated by this
Letter; provided, however, that such indemnification shall be subject to
Section 9.1(d) and (f) and Section 10.3 of the APA.4.
    
    Attorneys Fees. Scottish Re shall reimburse ING for, or pay on INGs behalf,
reasonable actual attorneys fees and disbursements incurred in connection with the
negotiation, preparation, execution and delivery of this Letter and the transaction documents
contemplated by Section 1 of this Letter (without duplication of attorneys fees payable under
the March 31 LOI) provided that such fees and disbursements shall be aggregated with
those subject to Section 8 of the March 31 LOI in applying the $1 million limitation set forth
therein.5.
    
    Conditions to Closing. The closing of the transactions contemplated by Section 1 of
this Letter under the definitive agreements contemplated thereby will be conditioned on the
receipt of all required governmental, regulatory, shareholder and material third-party
consents and the approvals set forth in Section 9 of this Letter. The conditions to the
closing of the transactions contemplated by the March 31 LOI shall be as set forth in the
March 31 LOI.6.
    
    Confidentiality. The parties here acknowledge and agree that this Letter and the
transactions contemplated hereby shall be subject to the Confidentiality Agreement, dated as
of December 21, 2007, by and among Scottish Re Group
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Limited and ING America Holdings Inc. (the Confidentiality Agreement).
Notwithstanding the foregoing or anything in this Letter or the Confidentiality Agreement
to the contrary, the parties acknowledge and agree that disclosure of any of the terms of,
or the existence of, this Letter may be made as is necessary or advisable in communications
or filings made with auditors retained by either party, any state or governmental insurance
regulators (whether domestic or foreign), or the partys rating agencies, or as may be
necessary or advisable under federal or state securities laws.
 7.
    
    Publicity. The parties shall mutually agree upon the form and content of any public
statement that may be made with respect to this Letter or the transactions contemplated hereby
and, except as required by law or regulation, no such public statement shall be made unless
mutually agreed upon by the parties hereto. The parties agree that statements made by either
party to its respective ratings agencies, state or other governmental regulatory authority
(including on Form 10-K filed with the Securities and Exchange Commission), holders of a
controlling interest in the ownership of such party, or any third-party subject to a
confidentiality agreement with the party making such public statement will not be deemed a
public statement for purposes of this Letter. For greater certainty, the parties hereto shall
be entitled to disclose this Letter and the transactions contemplated hereby to their
respective rating agencies and on Form 10-K filed with the Securities and Exchange Commission
to the extent required. Any public or private statement by any party with respect to the
terms of this Letter or the transactions contemplated hereby shall be accurate, complete and
not misleading, and any material misstatement or omission with respect thereto shall be
promptly corrected by the appropriate party. No party shall refer to any other party or any
of its affiliates in any of its advertising or promotional material without the consent of
such other party.8.
    
    Good Faith. Following the signing of this Letter, each of the parties to this Letter
shall promptly enter into good faith negotiations to prepare and execute definitive agreements
as soon as practicable with respect to, and when required by, the transactions contemplated
herein. The parties shall use their reasonable best efforts to have the definitive agreements
drafted in substantially final form on or before thirty (30) days from the date of execution
of this Letter. The definitive agreements will include the terms described in this Letter and
such other representations, warranties, covenants, indemnities, conditions and other terms as
are appropriate and agreed to by the parties hereto.9.
    
    Consents and Approvals. Commencing upon signing of this Letter, Scottish Re and ING
will use all commercially reasonable efforts, and will cooperate with each other in good
faith, to cause Scottish Re and ING to obtain all governmental, regulatory and third party
consents and approvals necessary for the consummation of the transactions contemplated herein
on an expedited basis.10.
    
    Remedies. Each party to this Letter understands and agrees that the breach or
non-fulfillment of any of the covenants, agreements or promises under this Letter
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of such party would irreparably injure the other party to this Letter (the
Non-Breaching Party), that money damages would not be a sufficient remedy for any
such breach or non-fulfillment, and that, in addition to the Non-Breaching Partys remedies
available at law for losses, claims, damages, liabilities or expenses suffered or incurred
in connection with such breach or non-fulfillment, or in equity, the Non-Breaching Party
will be entitled to seek specific performance and injunctive or other equitable relief as a
remedy for any such non-fulfillment or breach.
 11.
    
    Assignment; Binding Effect. This Letter may not be assigned by either ING or
Scottish Re without the prior written consent of the other. This Letter shall be binding upon
and inure to the benefit of Scottish Re and ING and their respective successors and permitted
assigns and shall be enforceable in accordance with its terms against Scottish Re and ING and
their respective successors and permitted assigns.12.
    
    Governing Law. This Letter shall be governed by, and construed in accordance with,
the laws of the State of New York.13.
    
    No Third-Party Beneficiaries. No person other than the parties to this Letter, their
successors and permitted assigns, is intended to be a beneficiary of this Letter.14.
    
    Amendment. This Letter shall not be amended except by a written instrument executed
by the parties hereto.15.
    
    Entire Understanding. This Letter and the Confidentiality Agreement set forth the
entire understanding of the parties with respect to the matters addressed herein.16.
    
    Counterparts. This Letter may be executed in counterparts, each of which shall be
deemed to constitute an original but all of which together shall constitute one and the same
instrument.17.
    
    Obligations of SR Dublin. SR Dublin shall be liable pursuant to the terms of this
Letter only in respect of those obligations that are explicitly assumed by it hereunder
(including obligations relating to the March 31 LOI) and shall not be liable for obligations
described as those of Scottish Re (as such term is defined in the opening paragraph of this
Letter).
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