Exhibit 4.1
AGREEMENT
THIS AGREEMENT is entered into this 4th day of December, 1997, by and
between American Equity Investment Life Holding Company, an Iowa corporation
("Company"), with its principal offices at 0000 Xxxxxxx Xxxxxxx, Xxxxx 000, Xxxx
Xxx Xxxxxx, Xxxx 00000; and FARM BUREAU LIFE INSURANCE COMPANY, an Iowa
corporation ("Investor"), with its principal offices at 0000 Xxxxxxxxxx Xxxxxx,
Xxxx Xxx Xxxxxx, Xxxx 00000.
WHEREAS, Investor has agreed to subscribe for 1,562,500 shares of Company's
Common Stock, $1 par value (hereinafter referred to as "Common Stock"), pursuant
to a private placement conducted by Company in December, 1997 (hereinafter
referred to as the "Private Placement"), as described in the Private Placement
Memorandum relating thereto, dated December 1, 1997 (the "Private Placement
Memorandum");
WHEREAS, Company has agreed to grant Investor certain rights of refusal to
acquire additional securities of Company pursuant to the terms and conditions
set forth below such that Investor may maintain at least a twenty percent (20%)
equity interest in the voting securities of Company.
NOW, THEREFORE, THE PARTIES AGREE, as follows:
1. Grant of Right of First Refusal.
(a) Company hereby grants Investor a right of first refusal to purchase up
to that number of shares of Common Stock, and/or shares or units of any other
voting or nonvoting equity securities or securities convertible into voting
equity securities of Company (hereinafter referred to collectively as "Equity
Securities"), which, when added to the number of shares owned by Investor at the
time of any exercise of the right of first refusal equals 20% of all issued and
outstanding Equity Securities at that time (hereinafter referred to as the
"Right of First Refusal"). The Right of First Refusal may be exercised by
Investor (i) in the event of any offering or other proposed issuance by Company
of any Equity Securities which, upon closing of same, would cause Investor's
aggregate ownership interest in the outstanding Equity Securities to fall below
20% (hereinafter referred to as an "Offering"); or (ii) upon the exercise of any
options or warrants to purchase Equity Securities (hereinafter referred to as an
"Option Exercise") or the conversion of any securities convertible into Equity
Securities (hereinafter referred to as a "Conversion") which would cause
Investor's aggregate ownership interest in the outstanding Equity Securities to
fall below 20%. The purchase price for Equity Securities acquired by Investor
pursuant to the Right of First Refusal shall be (i) in the event of an Offering,
the price per share, or other pro rata price, at which Equity Securities are
offered in the applicable Offering; or (ii) in the event of an Option Exercise
or a Conversion, the price of $16 per share.
(b) At least thirty (30) days prior to the initiation of any Offering,
Company shall notify Investor in writing of the expected date on which the
Offering shall begin (hereinafter referred to as the "Offering Date"), after
which Investor may exercise the Right of First Refusal by giving written notice
to Company on or before the Offering Date of the amount of Equity Securities
Investor elects to purchase and delivering to Company at its principal offices,
the full
purchase price by check payable to Company on or before the closing date of the
applicable Offering.
(c) Upon any Option Exercise or Conversion, which, when aggregated with all
other Option Exercises or Conversions during the then current fiscal year,
results in the issuance of 1% or more of the Company's outstanding Equity
Securities, Company shall notify Investor in writing of the Option Exercise or
Conversion and of the total number of shares issued during the then current
fiscal year in connection with Option Exercises or Conversions, after which
Investor may exercise the Right of First Refusal by giving written notice to
Company of the amount of Equity Securities Investor elects to purchase and
delivering to Company at its principal offices the full purchase price by check
payable to Company within thirty (30) days after the date of receipt of
Company's notice.
(d) Notwithstanding anything in this Agreement to the contrary, Investor's
obligation to close at any Offering in which Equity Securities are offered to
other parties is conditional upon the receipt from such others which, when added
to the proceeds to be received from Investor in such Offering, equal or exceed
the minimum aggregate proceeds sufficient to complete the Offering as specified
by Company in the applicable Offering instruments and/or documentation.
(e) The Right of First Refusal shall expire on December 31, 2007, whether
or not Company has conducted any Offerings prior to that date, and whether or
not any Option Exercises or Conversions have occurred, unless the parties agree
in writing to an extension thereof.
2. Nontransferability. The Right of First Refusal may not be transferred or
assigned in any manner, nor may the Right of First Refusal be pledged or
hypothecated in any way or subject to execution, attachment or similar process
except with the express consent of the Board of Directors of Company; provided,
however, that Investor may transfer and/or assign the Right of First Refusal to
any wholly-owned subsidiary of Investor, or to any affiliate under common
control with Investor.
3. Adjustments.
(a) Whenever a stock split, stock dividend or other similar change in
capitalization of Company occurs, and to the extent the Right of First Refusal
is unexercised at that time, the amount of equity interest in Company which can
thereafter be purchased pursuant to the Right of First Refusal, shall be
appropriately adjusted to maintain the proportionate equity interest in Company
which Investor may acquire thereunder.
(b) In the event of the dissolution or liquidation of Company, the Right of
First Refusal shall terminate, and Investor's proportionate interest in the
liquidation proceeds shall be based solely upon the equity interest actually
owned by Investor on the date of dissolution without adjustment for the shares
or other interests Investor could have but did not acquire pursuant to the Right
of First Refusal.
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(c) Adjustments and determinations under this paragraph 3 shall be made by
Company's Board of Directors, whose decisions as to what adjustments or
determinations shall be made, and the extent thereof, shall be final, binding
and conclusive.
4. Notices. Each notice relating to this Agreement shall be in writing,
addressed to the President of recipient and delivered in person or by certified
mail to the recipient's address as set forth in the heading of this Agreement.
Either party hereof may designate a new address by written notice to that
effect.
5. Governing Law. This Agreement shall be construed and enforced in
accordance with the laws of the State of Iowa.
6. Amendment. This Agreement may be amended from time to time as mutually
agreed upon by the parties. No amendment will be effective unless in writing and
signed by both parties.
7. Invalid Provisions. The unenforceability or invalidity of any term,
condition, or provision hereof, shall in no way affect the enforceability or
validity of the remaining terms of this Agreement.
IN WITNESS WHEREOF, Company and Investor have caused this Agreement to be
executed effective as of the day, month and year first above written.
AMERICAN EQUITY INVESTMENT FARM BUREAU LIFE INSURANCE
LIFE HOLDING COMPANY COMPANY
By: /s/ X. X. Xxxxx By: /s/ Xxxxxxx X. Xxxx
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X. X. Xxxxx, Chairman and President Xxxxxxx X. Xxxx, Executive Vice
President and General Manager
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