EXHIBIT 1.1
AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY
5.25% CONTINGENT CONVERTIBLE SENIOR NOTES DUE 2024
PURCHASE AGREEMENT
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December 23, 2004
Deutsche Bank Securities Inc.
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
American Equity Investment Life Holding Company, an Iowa corporation
(the "Company"), proposes, subject to the terms and conditions contained
herein, to issue and sell to Deutsche Bank Securities Inc. (the "Initial
Purchaser") $10,000,000 aggregate principal amount of its 5.25% Contingent
Convertible Senior Notes Due 2024 (the "Securities"). The Securities will be
issued as a separate series pursuant to the Indenture (the "Base Indenture")
dated as of December 6, 2004 between the Company and U.S. Bank National
Association, as trustee (the "Trustee"), as supplemented by the First
Supplemental Indenture (the "First Supplemental Indenture" and together with
the Base Indenture, the "Indenture"), to be dated as of the Closing Date (as
defined in Section 2 hereof), between the Company and the Trustee.
The Securities will be convertible into cash and shares of common
stock of the Company, $1.00 par value ("Common Stock"). The shares of Common
Stock into which the Securities may be convertible are referred to herein as
the "Underlying Securities".
The sale of the Securities and the Underlying Securities will be made
without registration under the Securities Act of 1933, as amended (the
"Securities Act"), in reliance on exemptions from the registration requirements
of the Securities Act. The Initial Purchaser has advised the Company that the
Initial Purchaser will offer and sell the Securities purchased by it hereunder
(the "Offering") in accordance with Section 3 hereof as soon as it deems
advisable.
In connection with the Offering, the Company has prepared a
supplement dated December 23, 2004 (the "Supplement") to the final Offering
Memorandum dated December 1, 2004 (including the information incorporated by
reference therein and together with the Supplement, the "Offering Memorandum").
The Offering Memorandum sets forth or incorporates by reference certain
information regarding the Company, the Securities and the Underlying
Securities. The Company hereby confirms that it has authorized the use of the
Offering Memorandum, and any amendment or supplement thereto, in connection
with the Offering. Unless stated to the contrary, all references herein to the
Offering Memorandum are to the Offering Memorandum at the date thereof and are
not meant to include any amendment or supplement, or any information
incorporated by reference therein subsequent to the date thereof, and any
references herein to the terms "amend", "amendment" or "supplement" with
respect to the Offering Memorandum shall be deemed to refer to and include any
information filed under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), subsequent to the date of the Offering Memorandum which is
incorporated by reference therein.
In connection with the Offering , the Company also proposes to enter
into a Registration Rights Agreement, to be dated as of the Closing Date,
between the Company and the Initial Purchaser (the "Registration Rights
Agreement").
In consideration of the mutual agreements contained herein and of the
interests of the parties in the transactions contemplated hereby, the parties
hereto agree as follows:
1. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
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The Company represents and warrants to the Initial Purchaser as
follows:
(a) the Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the State of Iowa, with
the corporate power and authority to own or lease its properties and
conduct its business as described in the Offering Memorandum and to enter
into and perform its obligations under this Agreement; each of the direct
and indirect subsidiaries of the Company (each, a "Subsidiary" and
collectively, the "Subsidiaries"), has been duly incorporated or organized
and is validly existing and in good standing under the laws of the
jurisdiction of its incorporation or organization, with the corporate or
other power and authority to own or lease its properties and conduct its
business as described in the Offering Memorandum; the Company and each of
the Subsidiaries are duly qualified to transact business in all
jurisdictions in which the conduct of their business requires such
qualification, except to the extent that the failure to be so qualified
would not result in a Material Adverse Change (as defined herein);
(b) the outstanding shares of capital stock of each of the
Subsidiaries have been duly authorized and validly issued, are fully paid
and non-assessable and are owned by the Company or another Subsidiary free
and clear of all liens, encumbrances and equities and claims, except those
securing obligations under the Amended and Restated Credit Agreement dated
September 22, 2004 among the Company, West Des Moines State Bank, LaSalle
Bank and U.S. Bank National Association, as agent (the "Credit Agreement")
or those that are immaterial to the Company and the Subsidiaries taken as
a whole; and, except as disclosed in the Offering Memorandum, no options,
warrants or other rights to purchase, agreements or other obligations to
issue or other rights to convert any obligations into or exchange any
securities for shares of capital stock of or ownership interests in the
Subsidiaries are outstanding;
(c) the Securities have been duly authorized by all necessary
corporate action on the part of the Company and, when executed by the
Company, authenticated by the Trustee in accordance with the terms of the
Indenture and delivered to and paid for by the Initial Purchaser in
accordance with the terms of this Agreement and the Indenture, the
Securities will (assuming the Indenture is a valid and binding obligation
of the Trustee) be valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms, except to
the extent that enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance or other
similar laws now or hereinafter in effect relating to or affecting
creditors' rights and remedies generally and by equitable principles of
general applicability (regardless of whether enforceability is considered
in a proceeding at law or in equity), and will be entitled to the benefits
of the Indenture and the Registration Rights Agreement;
(d) the outstanding shares of capital stock of the Company have been
duly authorized and validly issued and are fully paid and non-assessable;
none of the outstanding shares of capital stock of the Company was issued
in violation of any preemptive or similar rights of any stockholder of the
Company; the Underlying Securities have been duly authorized and reserved,
and when issued upon conversion of the Securities in accordance with the
terms of the Securities will be validly issued, fully paid and
non-assessable; and no preemptive or similar rights of stockholders exist
with respect to any of the Underlying Securities;
(e) the execution and delivery of and the performance by the Company
of its obligations under this Agreement have been duly authorized by all
necessary corporate action on the part of the Company, and this Agreement
has been duly executed and delivered by the Company;
(f) the execution and delivery of and the performance by the Company
of its obligations under each of the Base Indenture and the First
Supplemental Indenture have been duly authorized by all necessary
corporate action on the part of the Company and, when duly executed and
delivered by the Company and the Trustee (assuming each of the Base
Indenture and the First Supplemental Indenture is a valid and binding
obligation of the Trustee), each of the Base Indenture and the First
Supplemental Indenture will be a valid and binding agreement of the
Company, enforceable against the Company in accordance with its terms,
except to the extent that enforcement thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance
or other similar laws now or hereinafter in effect relating to or
affecting creditors' rights and remedies generally and by equitable
principles of general applicability (regardless of whether enforceability
is considered in a proceeding at law or in equity);
(g) the execution and delivery of and the performance by the Company
of its obligations under the Registration Rights Agreement have been duly
authorized by all necessary corporate action on the part of the Company
and, when duly executed and delivered by the Company and the other parties
thereto (assuming the Registration Rights Agreement is a valid and binding
obligation of the other parties thereto), the Registration Rights
Agreement will be a valid and binding agreement of the Company,
enforceable against the Company in accordance with its terms, except to
the extent that (x) enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance and other
similar laws now or hereinafter in effect relating to or affecting
creditors' rights and remedies generally and by equitable principles of
general applicability (regardless of whether enforceability is considered
in a proceeding at law or in equity), and (y) any right to indemnification
and contribution thereunder may be limited by applicable law;
(h) the consolidated capitalization of the Company set forth under
the caption "Capitalization" in the Offering Memorandum is true and
correct as of the date set forth therein; all of the Underlying Securities
conform to the description thereof contained in the Offering Memorandum in
all material respects; the form of certificate for the shares of Common
Stock conforms to the corporate law of the jurisdiction of the Company's
incorporation in all material respects;
(i) except as described in or contemplated by the Offering
Memorandum, there are no outstanding securities of the Company convertible
or exchangeable into or evidencing the right to purchase or subscribe for
any shares of capital stock of the Company and there are no outstanding or
authorized options, warrants or rights of any character obligating the
Company to issue any shares of its capital stock or any securities
convertible or exchangeable into or evidencing the right to purchase or
subscribe for any shares of such stock;
(j) each document filed, or to be filed, by the Company pursuant to
the Exchange Act and incorporated, or to be incorporated, by reference in
the Offering Memorandum (or any amendment or supplement thereto) at the
time filed with the Securities and Exchange Commission (the "Commission")
conformed, or will conform, in all material respects with the Exchange Act
and the applicable rules and regulations thereunder as in effect at such
time; the Offering Memorandum and any amendment or supplement thereto do
not contain, and at the Closing Date will not contain, any untrue
statement of a material fact, and do not omit to state, and at the Closing
Date will not omit to state, any material fact necessary in order to make
the statements made, in the light of the circumstances under which they
were made, not misleading; provided, however, that the Company makes no
representation or warranty as to statements in or omissions from the
Offering Memorandum or any amendment or supplement thereto made in
reliance upon and in conformity with written information relating to the
Initial Purchaser furnished to the Company by the Initial Purchaser
specifically for use therein;
(k) the consolidated financial statements of the Company and the
Subsidiaries, together with related notes and schedules, incorporated by
reference in the Offering Memorandum, present fairly in all material
respects the financial position and the results of operations and cash
flows of the Company and its consolidated Subsidiaries, at the indicated
dates and for the indicated periods; such financial statements and related
notes and schedules have been prepared in accordance with generally
accepted accounting principles in the United States, consistently applied
throughout the periods involved, except as disclosed therein, and all
adjustments necessary for a fair presentation of results for such periods
have been made; the selected consolidated financial and other data of the
Company and the Subsidiaries included in the Offering Memorandum presents
fairly in all material respects the information shown therein and such
data has been compiled on a basis consistent with that of the audited
consolidated financial statements incorporated by reference in the
Offering Memorandum or with statutory accounting principles or practices
required or permitted by the National Association of Insurance
Commissioners and by the appropriate insurance department of the
jurisdiction of each Insurance Subsidiary (as defined below) ("SAP"), as
applicable;
(l) Ernst & Young LLP, who have certified certain of the financial
statements included or incorporated by reference in the Offering
Memorandum, are independent public accountants as required by the
Securities Act and the applicable rules and regulations thereunder;
(m) except as disclosed in the Offering Memorandum, there is no
action, suit, claim, proceeding or labor dispute pending or, to the best
knowledge of the Company, threatened against the Company or any of the
Subsidiaries before any court or administrative agency or otherwise which,
if determined adversely to the Company or any of its Subsidiaries, would
reasonably be expected to result in a material adverse change in the
earnings, business, properties, assets, operations, condition (financial
or otherwise) or prospects of the Company and the Subsidiaries taken as a
whole (a "Material Adverse Change"), or prevent the consummation of the
transactions contemplated hereby or in the Indenture, the Securities or
the Registration Rights Agreement;
(n) the Company and the Subsidiaries have good and marketable title
to all real property owned by them and good title to all other properties
owned by them, subject to no lien, mortgage, pledge, charge or encumbrance
of any kind, except those securing obligations under the Credit Agreement
or reflected in the consolidated financial statements hereinabove
described or described in the Offering Memorandum or which do not
materially affect the value of such property and do not interfere with the
use made of such property; the Company and the Subsidiaries occupy their
leased properties under valid and binding leases;
(o) the Company and the Subsidiaries have filed all Federal, State,
local and foreign tax returns which have been required to be filed and
have paid all taxes indicated by such returns and all assessments received
by them or any of them to the extent that such taxes have become due,
except to the extent that any failure to so file or pay would not
reasonably be expected to result in a Material Adverse Change; all tax
liabilities have been adequately provided for in the financial statements
of the Company, and the Company does not know of any actual or proposed
additional material tax assessments;
(p) since the respective dates as of which information is given in
the Offering Memorandum, except as otherwise stated therein, there has not
been any Material Adverse Change or, to the best knowledge of the Company,
any development involving a prospective Material Adverse Change, whether
or not arising in the ordinary course of business, and there has not been
any material transaction entered into or any material transaction that is
probable of being entered into by the Company or any of the Subsidiaries,
other than transactions in the ordinary course of business and
transactions described in the Offering Memorandum, which are material to
the Company and the Subsidiaries considered as one enterprise; neither the
Company nor any of the Subsidiaries has any contingent obligations which
are material to the Company and the Subsidiaries taken as a whole but
which are not disclosed in the Company's financial statements that are
incorporated by reference in the Offering Memorandum;
(q) neither the Company nor any of the Subsidiaries is or, with the
giving of notice or lapse of time or both, will be, in violation of or in
default under (i) its certificate of incorporation or bylaws or similar
organizational documents or any indenture, mortgage, deed of trust, lease,
contract or other agreement or instrument to which any of them is a party
or to which any of them or any of their respective properties is bound
(collectively, "Contracts") and, solely with respect to this clause (ii),
which violation or default would result in a Material Adverse Change;
(r) the execution and delivery of this Agreement, the Securities, the
Indenture and the Registration Rights Agreement by the Company, the
issuance and sale of the Securities to the Initial Purchaser by the
Company pursuant to this Agreement, the issuance by the Company of the
Underlying Securities, and the consummation of the transactions
contemplated in this Agreement, the Securities, the Indenture and the
Registration Rights Agreement and the fulfillment of the terms hereof and
thereof by the Company will not conflict with or result in a breach of any
of the terms or provisions of, or constitute a default under, (i) any
Contract (including, without limitation, the Credit Agreement), (ii) the
certificate of incorporation or bylaws of the Company, or (iii) any law,
order, rule, regulation, judgment, order, writ or decree of any court
applicable to the Company or any Subsidiary or of any government,
regulatory body or administrative agency or other governmental body having
jurisdiction over the Company or any Subsidiary, except, in the case of
clauses (i) and (iii) to the extent that any such conflict, breach or
default would not reasonably be expected to result in a Material Adverse
Change;
(s) each approval, consent, order, authorization, designation,
declaration or filing by or with any regulatory, administrative or other
governmental body necessary in connection with the execution and delivery
by the Company of this Agreement, the Securities, the Indenture and the
Registration Rights Agreement, the issuance and sale of the Securities to
the Initial Purchaser by the Company pursuant to this Agreement, the
issuance of the Underlying Securities and the consummation of the
transactions contemplated in this Agreement, the Securities, the Indenture
and the Registration Rights Agreement has been obtained or made and is in
full force and effect, except for (i) the effectiveness of the Shelf
Registration Statement (as such term is defined in the Registration Rights
Agreement) under the Securities Act and the qualification of the Indenture
under the Trust Indenture Act of 1939, as amended (the "Trust Indenture
Act"), in each case as contemplated by the Registration Rights Agreement,
and (ii) such additional steps as may be necessary to qualify the
Securities for public offering by the Initial Purchaser under state
securities or "Blue Sky" laws; provided that the Company makes no such
representation and warranty as it relates to the representations,
warranties and agreements of the Initial Purchaser set forth in Section 3
of this Agreement.
(t) each of the Company and each Subsidiary that is engaged in the
business of insurance or reinsurance (collectively, the "INSURANCE
SUBSIDIARIES") is in compliance with the requirements of the insurance
laws and regulations of its respective jurisdiction of organization or
incorporation, as the case may be, and the insurance laws and regulations
of other jurisdictions which are applicable to it, and has filed all
notices, reports, documents or other information required to be filed
thereunder, in each case, with such exceptions as would not reasonably be
expected to result in a Material Adverse Change; neither the Company nor
any Insurance Subsidiary has received any notification from any insurance
regulatory authority to the effect that any additional authorization,
approval, order, consent, license, certificate, permit, registration or
qualification ("APPROVALS") is needed to be obtained by the Company or any
of the Insurance Subsidiaries in any case where it could be reasonably
expected that obtaining such Approvals or the failure to obtain such
Approvals would result in a Material Adverse Change;
(u) each of the Insurance Subsidiaries holds such insurance licenses,
certificates and permits from governmental authorities (including, without
limitation, from the insurance regulatory agencies of the various
jurisdictions where it conducts business (the "INSURANCE LICENSES")) as
are material to the conduct of its business as described in the Offering
Memorandum; the Company and each Insurance Subsidiary have fulfilled and
performed all obligations necessary to maintain such Insurance Licenses;
there is no pending or, to the best knowledge of the Company, threatened
action, suit, proceeding or investigation that would reasonably be
expected to result in the revocation, termination or suspension of any
Insurance License that would reasonably be expected to, individually or in
the aggregate, result in a Material Adverse Change; no insurance
regulatory agency or body has issued, or commenced any proceeding for the
issuance of, any order or decree impairing, restricting or prohibiting the
payment of dividends by any Insurance Subsidiary to its parent;
(v) All reinsurance treaties and arrangements to which any Insurance
Subsidiary is a party are in full force and effect and no Insurance
Subsidiary is in violation of, or in default in the performance,
observance or fulfillment of, any obligation, agreement, covenant or
condition contained therein, except where the failure to be in full force
and effect or where such violation or default would not, individually or
in the aggregate, be reasonably expected to result in a Material Adverse
Change. No Insurance Subsidiary has received any notice from any of the
other parties to such treaties, contracts or agreements that such other
party intends not to perform such treaty and, to the best knowledge of the
Company, none of the other parties to such treaties or arrangements will
be unable to perform such treaty or arrangement except to the extent
adequately and properly reserved for in the audited consolidated financial
statements of the Company included or incorporated by reference in the
Offering Memorandum, except where such nonperformance would not reasonably
be expected to, individually or in the aggregate, result in a Material
Adverse Change;
(w) the statutory financial statements of the Insurance Subsidiaries,
from which certain data included in the Offering Memorandum have been
derived, have been prepared, for each relevant period, in conformity with
SAP applied on a consistent basis throughout the periods involved, except
(1) as may otherwise be indicated therein or in the notes thereto and (2)
in the case of any such financial statements for periods less than a full
year, for any normal year-end adjustments, and present fairly in all
material respects the statutory financial position of the Insurance
Subsidiaries as of the dates thereof, and the statutory basis results of
operations of the Insurance Subsidiaries for the periods covered thereby.
(x) the Company and each of the Subsidiaries hold all material
licenses, certificates and permits from governmental authorities which are
necessary to the conduct of their businesses;
(y) the Company and the Subsidiaries each own or possess, or can
acquire on reasonable terms, adequate patents, patent rights, trademarks,
trade names, service marks, service names, copyrights, license rights,
know-how (including trade secrets and other unpatented and unpatentable
proprietary or confidential information, systems or procedures) and other
intellectual property rights ("Intellectual Property") necessary to carry
on their business in all material respects; none of the Company or any of
the Subsidiaries has received notice of any infringement of or conflict
with, any Intellectual Property of any other person or entity, except to
the extent that such infringement or conflict if determined adversely to
the Company or such Subsidiary would not reasonably be expected to result
in a Material Adverse Change;
(z) neither the Company nor, to the best of the Company's knowledge,
any of its affiliates, has taken or may take, directly or indirectly, any
action designed to cause or result in, or which has constituted or which
might reasonably be expected to constitute, the stabilization or
manipulation of the price of the Securities to facilitate the sale or
resale of the Securities;
(aa) the Company is not, and after giving effect to the offering and
sale of the Securities contemplated hereunder and the application of the
net proceeds from such sale as described in the Offering Memorandum will
not be, required to register as an "investment company" as such term is
defined in the Investment Company Act of 1940, as amended (the "Investment
Company Act");
(bb) the Company and each of the Subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurances
that (A) transactions are executed in accordance with management's general
or specific authorization; (B) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain accountability for assets;
(C) access to assets is permitted only in accordance with management's
general or specific authorization; and (D) the recorded accountability for
assets is compared with existing assets at reasonable intervals and
appropriate action is taken with respect to any differences;
(cc) the Company and the Subsidiaries comply with all Environmental
Laws (as defined below), except to the extent that failure to comply with
such Environmental Laws would not, individually or in the aggregate, be
reasonably expected to result in a Material Adverse Change; none of the
Company or any of the Subsidiaries is the subject of any pending or, to
the best knowledge of the Company, threatened federal, state or local
investigation evaluating whether any remedial action by the Company or any
of the Subsidiaries is needed to respond to a release of any Hazardous
Materials (as defined below) into the environment resulting from the
Company's or any of the Subsidiaries' business operations or ownership or
possession of any of their properties or assets, or is in contravention of
any Environmental Law that could reasonably be expected, individually or
in the aggregate, to result in any Material Adverse Change; none of the
Company or any of the Subsidiaries has received any notice or claim, nor
are there pending or, to the best knowledge of the Company, threatened
lawsuits against them, with respect to violations of an Environmental Law
or in connection with any release of any Hazardous Material into the
environment that could reasonably be expected in the aggregate to result
in a Material Adverse Change; as used herein, "Environmental Laws" means
any federal, state or local law or regulation applicable to the Company's
or any of the Subsidiaries' business operation or ownership or possession
of any of their properties or assets relating to environmental matters,
and "Hazardous Materials" means those substances that are regulated by or
form the basis of liability under any Environmental Laws;
(dd) the Company and each of its Subsidiaries carry, or are covered
by, insurance in such amounts and covering such risks as is generally
deemed adequate for the conduct of their respective businesses as
presently conducted and the value of their respective properties and as is
customary for companies engaged in similar businesses;
(ee) the Company and each Subsidiary are in compliance in all
material respects with all presently applicable provisions of the Employee
Retirement Income Security Act of 1974, as amended, including the
regulations and published interpretations thereunder ("ERISA"); no
"reportable event" (as defined in ERISA) has occurred with respect to any
"pension plan" (as defined in ERISA) for which the Company or any
Subsidiary would have any material liability; neither the Company nor any
Subsidiary has incurred or expects to incur any material liability under
(i) Title IV of ERISA with respect to termination of, or withdrawal from,
any "pension plan" or (ii) Sections 412 or 4971 of the Internal Revenue
Code of 1986, as amended, including the regulations and published
interpretations thereunder (the "Code"); and each "pension plan" for which
the Company or any Subsidiary would have any liability that is intended to
be qualified under Section 401(a) of the Code is so qualified in all
material respects and nothing has occurred, whether by action or by
failure to act, which would cause the loss of such qualification;
(ff) neither the Company, nor any of its affiliates (as defined in
Rule 501(b) of Regulation D under the Securities Act, each, an
"Affiliate"), nor any person acting on its or their behalf (other than the
Initial Purchaser and its representatives, as to whom the Company makes no
representation) has, directly or indirectly, made offers or sales of any
security (as defined in the Securities Act), or solicited offers to buy
any security, under circumstances that would require the registration of
the Securities or the Underlying Securities under the Securities Act;
(gg) neither the Company, nor any of its Affiliates, nor any person
acting on its or their behalf (other than the Initial Purchaser and its
representatives, as to whom the Company makes no representation) has
engaged in any form of general solicitation or general advertising (as
those terms are used in Rule 502(c) of Regulation D under the Securities
Act) in connection with any offer or sale of the Securities or the
Underlying Securities;
(hh) the Securities satisfy the eligibility requirements of Rule
144A(d)(3) under the Securities Act;
(ii) the Company is subject to and in full compliance in all material
respects with the reporting requirements of Section 13 or Section 15(d) of
the Exchange Act;
(jj) the Securities, the Indenture, the Registration Rights Agreement
each conform in all material respects to the descriptions thereof
contained in the Offering Memorandum;
(kk) there is and has been no failure on the part of the Company or,
to the best knowledge of the Company, any of the Company's directors or
officers, in their capacities as such, to comply in all material respects
with any provision of the Xxxxxxxx-Xxxxx Act of 2002 that are effective
and the rules and regulations promulgated in connection therewith,
including Section 402 related to loans and Sections 302 and 906 related to
certifications; and
(ll) except as disclosed in the Offering Memorandum, no holder of
securities of the Company (other than the Registrable Securities (as
defined in the Registration Rights Agreement)) will be entitled to have
such securities registered under the registration statements required to
be filed by the Company pursuant to the Registration Rights Agreement.
2. PURCHASE, SALE AND DELIVERY OF THE SECURITIES.
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(a) On the basis of the representations, warranties and covenants
herein contained, and subject to the conditions herein set forth, the
Company agrees to issue and sell to the Initial Purchaser and the Initial
Purchaser agrees to purchase from the Company, at a purchase price of 105%
of the aggregate principal amount thereof (the "Purchase Price"), plus
accrued interest from December 6, 2004 to the Closing Date, the
Securities. Each Security will be convertible at the option of the holder
into a combination of cash and the Underlying Securities at the conversion
price set forth in the Securities (the "Conversion Price"), which
Conversion Price is subject to adjustment in certain events as provided in
the Securities and the Indenture. One or more global securities
representing the Securities shall be registered by the Trustee in the name
of the nominee of The Depository Trust Company ("DTC"), Cede & Co.,
credited to the account of the Initial Purchaser, and deposited with the
Trustee as custodian for DTC on the Closing Date, against payment by or on
behalf of the Initial Purchaser to the account of the Company of the
aggregate Purchase Price therefor by wire transfer in immediately
available funds. Delivery of and payment for the Securities shall be made
at the offices of Xxxxx Xxxx & Xxxxxxxx, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000 at 9:30 A.M., New York City time, on the fourth full
business day following the date of this Agreement, or at such other place,
time or date not later than five business days thereafter as the Initial
Purchaser and the Company may agree upon. Such time and date of delivery
against payment are herein referred to as the "Closing Date". (As used
herein, "business day" means a day on which the New York Stock Exchange is
open for trading and on which banks in New York are open for business and
are not permitted by law or executive order to be closed.)
3. OFFERING BY THE INITIAL PURCHASER.
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(a) It is understood that the Initial Purchaser will offer and sell
the Securities in accordance with this Section as soon as the Initial
Purchaser deems it advisable to do so. The Securities are to be initially
offered at the offering price set forth in the Offering Memorandum. The
Initial Purchaser may from time to time thereafter change the price and
other selling terms.
(b) The Initial Purchaser understands and acknowledges that the
Securities and the Underlying Securities have not been and will not be
registered under the Securities Act (except as contemplated by the
Registration Rights Agreement) and may not be offered or sold, except in
compliance with the registration requirements of the Securities Act or
pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act. Accordingly, the Initial
Purchaser agrees that it has solicited and will solicit offers for the
Securities only from, and has offered and sold and will offer, sell or
deliver the Securities only to persons that it reasonably believes to be
qualified institutional buyers as defined in Rule 144A under the
Securities Act.
(c) The Initial Purchaser agrees that neither it nor any person
acting on its behalf has engaged or will engage in any form of general
solicitation or general advertising (as those terms are used in Rule
502(c) of Regulation D under the Securities Act) in connection with any
offer or sale of the Securities in the United States.
(d) The Initial Purchaser represents and warrants to the Company that
it is a "qualified institutional buyer" within the meaning of Rule 144A
under the Securities Act.
4. COVENANTS OF THE COMPANY.
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The Company covenants and agrees with the Initial Purchaser that:
(a) The Company will furnish to the Initial Purchaser and counsel for
the Initial Purchaser, without charge, during the period mentioned in
paragraph (d) below, as many copies of the Offering Memorandum, any
documents incorporated by reference therein and any supplements or
amendments thereto as they may reasonably request.
(b) The Company will not amend or supplement the Offering Memorandum,
other than by filing documents under the Exchange Act which are
incorporated by reference therein, and prior to the completion of the
distribution of the Securities by the Initial Purchaser, the Company will
not file any document under the Exchange Act which is incorporated by
reference in the Offering Memorandum, unless the Initial Purchaser
previously has been advised of and furnished with a copy within a
reasonable period of time prior to the proposed filing and the Initial
Purchaser shall have given its consent to such filing, such consent not to
be unreasonably withheld. The Company will prepare promptly upon request
by the Initial Purchaser or counsel for the Initial Purchaser any
amendments or supplements to the Offering Memorandum that may be necessary
or advisable in connection with the distribution of the Securities by the
Initial Purchaser. The Company will advise the Initial Purchaser of the
time when any amendment or supplement to the Offering Memorandum has been
made or when any document filed under the Exchange Act which is
incorporated by reference in the Offering Memorandum has been filed with
the Commission and will provide evidence satisfactory to the Initial
Purchaser of each such amendment, supplement or filing.
(c) The Company will cooperate with the Initial Purchaser in
endeavoring to qualify the Securities for sale under the securities laws
of such jurisdictions as the Initial Purchaser may reasonably have
designated in writing and will make such applications, file such documents
and furnish such information as may be reasonably required for that
purpose; provided that the Company shall not be required to qualify as a
foreign corporation or to file a general consent to service of process in
any jurisdiction where it is not now so qualified or required to file such
a consent or to subject itself to taxation in respect of doing business in
any jurisdiction in which it is not otherwise so subject. The Company
will, from time to time, prepare and file such statements, reports and
other documents, as are or may be required to continue such qualifications
in effect for so long a period as the Initial Purchaser may reasonably
request for distribution of the Securities.
(d) If at any time prior to the date on which all of the Securities
shall have been sold by the Initial Purchaser, any event shall occur as a
result of which, in the judgment of the Company or in the reasonable
opinion of the Initial Purchaser, it becomes necessary to amend or
supplement the Offering Memorandum in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, or if it is necessary at any time to amend or supplement the
Offering Memorandum to comply with applicable law, the Company promptly
will prepare an appropriate amendment or supplement to the Offering
Memorandum so that the Offering Memorandum as so amended or supplemented
will not contain statements that, in the light of the circumstances under
which they were made, are misleading, or so that the Offering Memorandum
will comply with applicable law.
(e) The Company will not, without the prior written consent of
Deutsche Bank Securities Inc., directly or indirectly offer, sell, pledge,
contract to sell (including any short sale), grant any option to purchase
or otherwise dispose of any shares of Common Stock or enter into any
Hedging Transaction (as defined below) relating to the Common Stock for a
period from the date hereof until and including the date that is 90 days
after the date of this Agreement. "Hedging Transaction" means any short
sale (whether or not against the box) or any purchase, sale or grant of
any right (including, without limitation, any put or call option) with
respect to any security (other than a broad-based market basket or index)
that includes, relates to or derives any significant part of its value
from the Common Stock. The foregoing sentence shall not apply to (A) the
sale of the Securities under this Agreement, (B) the issuance by the
Company of shares of Common Stock upon conversion of the Securities
pursuant to the terms of the Indenture, (C) the issuance by the Company of
shares of Common Stock, stock appreciation rights or common stock
equivalents or warrants, rights or options to purchase any of the
foregoing pursuant to any employee, officer or director stock option plan
or other benefit plan in effect on the date hereof (D) the issuance by the
Company of any shares of Common Stock upon the exercise of an option,
warrant or management subscription right or the conversion of a security,
in each case, outstanding on the date hereof, or (E) the filing of shelf
registration statements in respect of the Securities and shares of Common
Stock issuable upon conversion of the Securities pursuant to the terms of
the Registration Rights Agreement or any registration statement in respect
of any employee, officer or director stock option or other benefit plan.
(f) The Company will not, nor will it permit any of its Affiliates
to, resell any Securities that have been acquired by any of them.
(g) Except as contemplated by the Registration Rights Agreement,
neither the Company, nor any of its Affiliates, nor any person acting on
its behalf will, directly or indirectly, make offers or sales of any
security, or solicit offers to buy any security, under circumstances that
would require the registration of the Securities or the Underlying
Securities under the Securities Act.
(h) Neither the Company nor any of its Affiliates nor any person
acting on its behalf will engage in any form of general solicitation or
general advertising (as those terms are used in Rule 502(c) of Regulation
D under the Securities Act) in connection with any offer or sale of the
Securities in the United States.
(i) So long as any of the Securities or the Underlying Securities are
"restricted securities" within the meaning of Rule 144(a)(3) under the
Securities Act, the Company will, during any period in which it is not
subject to and in compliance with Section 13 or 15(d) of the Exchange Act
or exempt from such reporting requirements pursuant to and in compliance
with Rule 12g3-2(b) under the Exchange Act, provide to each holder of such
restricted securities and to each prospective purchaser (as designated by
such holder) of such restricted securities, upon the request of such
holder or prospective purchaser, any information required to be provided
by Rule 144A(d)(4) under the Securities Act. This covenant is intended to
be for the benefit of the holders, and the prospective purchasers
designated by such holders, from time to time of such restricted
securities.
(j) The Company will cooperate with the Initial Purchaser and use its
best efforts to (x) permit the Securities to be eligible for clearance and
settlement through DTC and (y) arrange to have the Securities be
designated by Nasdaq Stock Market, Inc. as PORTAL-eligible securities in
accordance with the rules and regulations of the National Association of
Securities Dealers, Inc. ("NASD").
(k) The Company will use its best efforts to cause the Underlying
Securities to be duly authorized for listing by the New York Stock
Exchange on or prior to the Closing Date and ensure that the Underlying
Securities remain authorized for listing following the Closing Date for so
long as the Common Stock is so listed.
(l) The Company shall apply the net proceeds of its sale of the
Securities as set forth in the Offering Memorandum.
(m) The Company shall not invest, or otherwise use the proceeds
received by the Company from its sale of the Securities in such a manner
as would require the Company to register as an "investment company" under
the Investment Company Act.
(n) The Company will not take, directly or indirectly, any action
designed to cause or result in, or that has constituted or might
reasonably be expected to constitute, the stabilization or manipulation of
the price of any securities of the Company.
(o) For so long as any Securities remain outstanding, the Company
will furnish to the Initial Purchaser copies of all reports and other
communications (financial or otherwise) furnished by the Company to the
Trustee or the holders of the Securities and, as soon as available, copies
of any reports or financial statements furnished to or filed by the
Company with the Commission or any national securities exchange on which
any class of securities of the Company may be listed; provided, however,
that the Company shall not be required to provide the Initial Purchaser
with any such reports or similar forms that have been filed with the
Commission by electronic transmission pursuant to XXXXX.
5. COSTS AND EXPENSES.
------------------
The Company will pay all costs, expenses and fees incident to the
performance of its obligations under this Agreement, including, without
limiting the generality of the foregoing, the following: accounting fees of the
Company; the fees and disbursements of counsel for the Company; the cost of
printing and delivering to, or as requested by, the Initial Purchaser copies of
the Offering Memorandum and any supplements or amendments thereto and the
printing and production of all other documents connected with the transactions
contemplated herein (including this Agreement, the Indenture, the Registration
Rights Agreement and any other related agreements); the listing fee of the New
York Stock Exchange; the expenses arising from having the Securities designated
as eligible for trading in the PORTAL market; the expenses associated with the
preparation, issuance and delivery to the Initial Purchaser of the Securities;
the fees and expenses of the Trustee, including fees and expenses of its
counsel; the expenses of the "roadshow" and any other meetings with prospective
investors in the Securities; the costs and expenses of advertising relating to
the Offering (other than advertising costs and expenses that the Initial
Purchaser expressly agrees to pay); and the expenses, including the reasonable
fees and disbursements of counsel for the Initial Purchaser, incurred in
connection with the qualification of the Securities under state securities or
"Blue Sky" laws. The Company shall not, however, be required to pay for any of
the Initial Purchaser's expenses (other than those related to qualification
under state securities or "Blue Sky" laws) except that, if this Agreement shall
not be consummated because the conditions in Section 6 hereof are not
satisfied, or because this Agreement is terminated by the Initial Purchaser
pursuant to Section 9 hereof, or by reason of any failure, refusal or inability
on the part of the Company to perform any undertaking or satisfy any condition
of this Agreement or to comply with any of the terms hereof on its part to be
performed, unless such failure, refusal or inability is due primarily to the
default or omission of the Initial Purchaser, the Company shall reimburse the
Initial Purchaser for reasonable out-of-pocket expenses, including fees and
disbursements of Xxxxx Xxxx & Xxxxxxxx, counsel for the Initial Purchaser,
reasonably incurred in connection with investigating, marketing and proposing
to market the Securities or in contemplation of performing their obligations
hereunder; but the Company shall not in any event be liable to the Initial
Purchaser for damages on account of loss of anticipated profits from the sale
by the Initial Purchaser of the Securities.
6. CONDITIONS OF OBLIGATIONS OF THE INITIAL PURCHASER.
--------------------------------------------------
The obligation of the Initial Purchaser to purchase the Securities on
the Closing Date is subject to the accuracy, as of the Closing Date, of the
representations and warranties of the Company contained herein, and to the
performance by the Company of its covenants and obligations hereunder and to
the following additional conditions:
(a) The Initial Purchaser shall have received on the Closing Date the
negative assurance letter of Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP,
special counsel for the Company, dated the Closing Date addressed to the
Initial Purchaser, in form and substance reasonably satisfactory to the
Initial Purchaser.
(b) Reserved.
(c) The Initial Purchaser shall have received on the Closing Date the
opinion of Xxxxx X. Xxxxxxx, Esq., General Counsel and Chief Financial
Officer to the Company, dated the Closing Date addressed to the Initial
Purchaser, in form and substance reasonably satisfactory to the Initial
Purchaser.
(d) The Initial Purchaser shall have received an opinion dated the
Closing Date of Xxxxx Xxxx & Xxxxxxxx, counsel for the Initial Purchaser,
with respect to certain legal matters relating to this Agreement, and such
other related matters as the Initial Purchaser may reasonably require. In
rendering such opinion, Xxxxx Xxxx & Xxxxxxxx shall have received and may
rely upon such certificates and other documents and information as they
may reasonably request to pass upon such matters.
(e) Reserved.
(f) The Initial Purchaser shall have received on the Closing Date a
certificate or certificates of the Chief Executive Officer and the Chief
Financial Officer of the Company to the effect that, as of the Closing
Date, each of them severally represents, to the best of their knowledge,
as follows:
(i) the representations and warranties of the Company contained
in Section 1 hereof are true and correct as of the Closing Date;
(ii) he or she has carefully examined the Offering Memorandum
(including the documents of the Company incorporated by reference
therein) and, in his or her opinion, as of the Closing Date, the
statements contained in the Offering Memorandum (including the
documents of the Company incorporated by reference therein) with
respect to the Company are true and correct in all material respects,
and with respect to the Company such Offering Memorandum (including
the documents of the Company incorporated by reference therein) does
not omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which
they were made, not misleading;
(iii) since the respective dates as of which information is
given in the Offering Memorandum, there has not been any Material
Adverse Change or any development involving a prospective Material
Adverse Change, whether or not arising in the ordinary course of
business; and
(iv) the Company has performed all covenants and agreements and
satisfied all conditions on its part to be performed or satisfied
under this Agreement and otherwise in connection with the transactions
contemplated hereby at or prior to the Closing Date.
(g) The Company shall have furnished to the Initial Purchaser such
further certificates and documents confirming the representations and
warranties, covenants and conditions contained herein and related matters
as the Initial Purchaser may reasonably have requested.
(h) The Underlying Securities shall have been duly listed, subject to
notice of issuance, on the New York Stock Exchange and the Securities
shall have been designated as PORTAL-eligible securities.
(i) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date, there shall not have occurred any downgrading,
nor shall any notice have been given of any intended or potential
downgrading or of any review for a possible change that does not indicate
the direction of the possible change, in the rating accorded any of the
Company's securities or the rating of any Subsidiary by any "nationally
recognized statistical rating organization", as such term is defined for
purposes of Rule 436(g)(2) under the Securities Act.
(j) Each of the First Supplemental Indenture and the Registration
Rights Agreement shall have been executed and delivered by all the parties
thereto (other than the Initial Purchaser with respect to the Registration
Rights Agreement).
The opinions and certificates mentioned in this Agreement shall be
deemed to be in compliance with the provisions hereof only if they are in all
material respects satisfactory to the Initial Purchaser.
If any of the conditions hereinabove provided for in this Section 6
shall not have been fulfilled when and as required by this Agreement to be
fulfilled, the Initial Purchaser may terminate their obligations hereunder by
notifying the Company of such termination in writing or by telegram at or prior
to the Closing Date.
In such event, the Company and the Initial Purchaser shall not be
under any obligation to each other (except to the extent provided in Sections 5
and 7 hereof).
7. Indemnification.
---------------
(a) The Company agrees:
(i) to indemnify and hold harmless the Initial Purchaser and
the affiliates, directors, officers and employees of the Initial
Purchaser and each person, if any, who controls the Initial Purchaser
within the meaning of either Section 15 of the Securities Act or
Section 20 of the Exchange Act, against any losses, claims, damages
or liabilities to which the Initial Purchaser or any such affiliate,
director, officer or employee or such controlling person may become
subject under the Securities Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions or proceedings in
respect thereof) arise out of or are based upon (x) any untrue
statement or alleged untrue statement of a material fact contained in
the Offering Memorandum or any amendment or supplement thereto, or
(y) the omission or alleged omission to state therein a material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided,
however, that the Company will not be liable in any such case to the
extent that any such loss, claim, damage or liability arises out of
or is based upon an untrue statement or alleged untrue statement, or
omission or alleged omission made in the Offering Memorandum, or any
amendment or supplement thereto, in reliance upon and in conformity
with written information furnished to the Company by any Initial
Purchaser specifically for use in the preparation thereof; or
(ii) to reimburse the Initial Purchaser and each such affiliate,
director, officer and employee and each such controlling person upon
demand for any legal or other out-of-pocket expenses reasonably
incurred by the Initial Purchaser, such affiliate, director, officer
or employee or such controlling person in connection with
investigating or defending or appearing as a third-party witness in
connection with any such loss, claim, damage or liability, action or
proceeding or in responding to a subpoena or governmental inquiry
related to the Offering, whether or not the Initial Purchaser or any
such controlling person is a party to any action or proceeding. In
the event that it is finally judicially determined that the Initial
Purchaser was not entitled to receive payments for legal and other
expenses pursuant to this subparagraph, the Initial Purchaser will
promptly return all sums that had been advanced pursuant hereto.
(b) The Initial Purchaser agrees, to indemnify and hold harmless the
Company, its directors, officers and employees and each person, if any,
who controls the Company within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act, against any losses,
claims, damages or liabilities to which the Company or any such director,
officer or controlling person may become subject under the Securities Act
or otherwise, insofar as such losses, claims, damages or liabilities (or
actions or proceedings in respect thereof) arise out of or are based upon
(i) any untrue statement or alleged untrue statement of a material fact
contained in the Offering Memorandum or any amendment or supplement
thereto, or (ii) the omission or the alleged omission to state therein a
material fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading; and will
reimburse any legal or other expenses reasonably incurred by the Company
or any such director, officer or controlling person in connection with
investigating or defending any such loss, claim, damage, liability, action
or proceeding; provided, however, that the Initial Purchaser will be
liable in each case to the extent, but only to the extent, that such
untrue statement or alleged untrue statement or omission or alleged
omission has been made in the Offering Memorandum or any amendment or
supplement thereto, in reliance upon and in conformity with written
information furnished to the Company by any Initial Purchaser specifically
for use in the preparation thereof. This indemnity agreement will be in
addition to any liability which the Initial Purchaser may otherwise have.
(c) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may
be sought pursuant to this Section 7, such person (the "indemnified
party") shall promptly notify the person against whom such indemnity may
be sought (the "indemnifying party") in writing. No indemnification
provided for in Section 7(a) or (b) shall be available to any party who
shall fail to give notice as provided in this Section 7(c) if the party to
whom notice was not given was unaware of the proceeding to which such
notice would have related and was materially prejudiced by the failure to
give such notice, but the failure to give such notice shall not relieve
the indemnifying party or parties from any liability which it or they may
have to the indemnified party for contribution or otherwise than on
account of the provisions of Section 7(a) or (b). In case any such
proceeding shall be brought against any indemnified party and it shall
notify the indemnifying party of the commencement thereof, the
indemnifying party shall be entitled to participate therein and, to the
extent that it shall wish, jointly with any other indemnifying party
similarly notified, to assume the defense thereof, with counsel
satisfactory to such indemnified party and shall pay as incurred the fees
and disbursements of such counsel related to such proceeding. In any such
proceeding, any indemnified party shall have the right to retain its own
counsel at its own expense. Notwithstanding the foregoing, the
indemnifying party shall pay as incurred (or within 30 days of
presentation) the fees and expenses of the counsel retained by the
indemnified party in the event (i) the indemnifying party and the
indemnified party shall have mutually agreed to the retention of such
counsel, (ii) the named parties to any such proceeding (including any
impleaded parties) include both the indemnifying party and the indemnified
party and representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between them
or (iii) the indemnifying party shall have failed to assume the defense of
and employ counsel acceptable to the indemnified party within a reasonable
period of time after notice of commencement of the action. It is
understood that the indemnifying party shall not, in connection with any
proceeding or related proceedings in the same jurisdiction, be liable for
the reasonable fees and expenses of more than one separate firm for all
such indemnified parties. Such firm shall be designated in writing by
Deutsche Bank Securities Inc. in the case of parties indemnified pursuant
to Section 7(a) and by the Company in the case of parties indemnified
pursuant to Section 7(b). The indemnifying party shall not be liable for
any settlement of any proceeding effected without its written consent, but
if settled with such consent or if there be a final judgment for the
plaintiff, the indemnifying party agrees to indemnify the indemnified
party from and against any loss or liability by reason of such settlement
or judgment. In addition, the indemnifying party will not, without the
prior written consent of the indemnified party, settle or compromise or
consent to the entry of any judgment in any pending or threatened claim,
action or proceeding of which indemnification may be sought hereunder
(whether or not any indemnified party is an actual or potential party to
such claim, action or proceeding) unless such settlement, compromise or
consent includes an unconditional release of each indemnified party from
all liability arising out of such claim, action or proceeding.
(d) To the extent the indemnification provided for in this Section 7
is unavailable to or insufficient to hold harmless an indemnified party
under Section 7(a) or (b) above in respect of any losses, claims, damages
or liabilities (or actions or proceedings in respect thereof) referred to
therein, then each indemnifying party shall contribute to the amount paid
or payable by such indemnified party as a result of such losses, claims,
damages or liabilities (or actions or proceedings in respect thereof) in
such proportion as is appropriate to reflect the relative benefits
received by the Company on the one hand and the Initial Purchaser on the
other from the offering of the Securities. If, however, the allocation
provided by the immediately preceding sentence is not permitted by
applicable law then each indemnifying party shall contribute to such
amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits but also the
relative fault of the Company on the one hand and the Initial Purchaser on
the other in connection with the statements or omissions which resulted in
such losses, claims, damages or liabilities (or actions or proceedings in
respect thereof), as well as any other relevant equitable considerations.
The relative benefits received by the Company on the one hand and the
Initial Purchaser on the other shall be deemed to be in the same
proportion as the total net proceeds from the offering (before deducting
expenses) received by the Company bear to the total discounts and
commissions received by the Initial Purchaser. The relative fault shall be
determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the
Company on the one hand or the Initial Purchaser on the other and the
parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission. The Company and the
Initial Purchaser agree that it would not be just and equitable if
contributions pursuant to this Section 7(d) were determined by pro rata
allocation or by any other method of allocation which does not take
account of the equitable considerations referred to above in this Section.
The amount paid or payable by an indemnified party as a result of the
losses, claims, damages or liabilities (or actions or proceedings in
respect thereof) referred to above in this Section 7(d) shall be deemed to
include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this subsection (d),
(i) the Initial Purchaser shall not be required to contribute any amount
in excess of the discounts and commissions applicable to the Securities
purchased by the Initial Purchaser and (ii) no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities
Act) shall be entitled to contribution from any person who was not guilty
of such fraudulent misrepresentation.
(e) In any proceeding relating to the Offering Memorandum or any
supplement or amendment thereto, each party against whom contribution may
be sought under this Section 7 hereby consents to the jurisdiction of any
court having jurisdiction over any other contributing party, agrees that
process issuing from such court may be served upon it by any other
contributing party and consents to the service of such process and agrees
that any other contributing party may join it as an additional defendant
in any such proceeding in which such other contributing party is a party.
(f) Any losses, claims, damages, liabilities or expenses for which an
indemnified party is entitled to indemnification or contribution under
this Section 7 shall be paid by the indemnifying party to the indemnified
party as such losses, claims, damages, liabilities or expenses are
incurred. A successor to any Initial Purchaser or any affiliate, director,
officer or employee of the Initial Purchaser or any person controlling any
Initial Purchaser, or to the Company, any director, officer or employee of
the Company or any person controlling the Company, shall be entitled to
the benefits of the indemnity, contribution and reimbursement agreements
contained in this Section 7.
8. Notices.
-------
All communications hereunder shall be in writing and, except as
otherwise provided herein, shall be mailed, delivered, telecopied, faxed or
telegraphed and confirmed as follows: if to the Initial Purchaser, to Deutsche
Bank Securities Inc., 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000; Attention:
Syndicate Department, Fax: (000) 000-0000, with a copy to Deutsche Bank
Securities Inc., 00 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: General
Counsel, Fax: (000) 000-0000; if to the Company, to 0000 Xxxxxxx Xxxxxxx, Xxxxx
000, Xxxx Xxx Xxxxxx, Xxxx, 00000, Attention: Xxxxx X. Xxxxx, CEO and Chairman,
Fax: (000) 000-0000, with a copy to Xxxxx Xxxxxxx, CFO and General Counsel,
Fax: (000) 000-0000.
9. Termination.
-----------
(a) This Agreement may be terminated by the Initial Purchaser by
notice to the Company at any time prior to the Closing Date if any of the
following has occurred: (i) since the date as of which information is
given in the Offering Memorandum, any Material Adverse Change or any
development involving a prospective Material Adverse Change, whether or
not arising in the ordinary course of business, (ii) any outbreak or
escalation of hostilities or declaration of war or national emergency or
other national or international calamity or crisis or change in economic
or political conditions if the effect of such outbreak, escalation,
declaration, emergency, calamity, crisis or change on the financial
markets of the United States would, in the sole judgment of the Initial
Purchaser, make it impracticable or inadvisable to market the Securities
or to enforce contracts for the sale of the Securities, (iii) suspension
of trading in securities generally on the New York Stock Exchange, the
American Stock Exchange or the Nasdaq National Market or limitation on
prices (other than limitations on hours or numbers of days of trading) for
securities on any such exchange or market, (iv) the enactment,
publication, decree or other promulgation of any statute, regulation, rule
or order of any court or other governmental authority which in the opinion
of the Initial Purchaser materially and adversely affects or may
materially and adversely affect the business or operations of the Company,
(v) the declaration of a banking moratorium by United States or New York
State authorities, (vi) any downgrading, or placement on any watch list
for possible downgrading, in the rating of any of the Company's debt
securities by any "nationally recognized statistical rating organization"
(as defined for purposes of Rule 436(g) under the Exchange Act), (vii) the
suspension of trading of the Company's common stock by the New York Stock
Exchange, the Commission, or any other governmental authority, or (viii)
the taking of any action by any governmental body or agency in respect of
its monetary or fiscal affairs which in the reasonable opinion of the
Initial Purchaser has a material adverse effect on the securities markets
in the United States; or
(b) as provided in Section 6 of this Agreement.
10. Reserved.
--------
11. SUCCESSORS.
----------
This Agreement has been and is made solely for the benefit of the
Initial Purchaser and the Company and their respective successors and assigns,
and the officers, directors and controlling persons referred to herein, and no
other person will have any right or obligation hereunder. No purchaser of any
of the Securities from the Initial Purchaser shall be deemed a successor or
assign merely because of such purchase.
12. INFORMATION PROVIDED BY THE INITIAL PURCHASER.
---------------------------------------------
The Company and the Initial Purchaser acknowledge and agree that the
only information furnished or to be furnished by the Initial Purchaser to the
Company for inclusion in the Offering Memorandum consists of the information
set forth in the first sentence of the third paragraph, the third sentence of
the fourth paragraph, the second sentence of the sixth paragraph (with respect
to action by the Initial Purchaser), the entirety of the seventh and eighth
paragraphs and the fourth sentence of the ninth paragraph, in each case under
the heading "Plan of Distribution" (insofar as such information relates to the
Initial Purchaser).
13. MISCELLANEOUS.
-------------
The reimbursement, indemnification and contribution agreements
contained in this Agreement and the representations, warranties and covenants
in this Agreement shall remain in full force and effect regardless of (a)
subject to the last sentence of Section 6, any termination of this Agreement,
(b) any investigation made by or on behalf of the Initial Purchaser or any
controlling person thereof, or by or on behalf of the Company or its directors,
officers and employees or any controlling person thereof and (c) delivery of
and payment for the Securities under this Agreement.
This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
This Agreement shall be governed by, and construed in accordance
with, the laws of the State of New York.
If the foregoing letter is in accordance with your understanding of
our agreement, please sign and return to us the enclosed duplicates hereof,
whereupon it will become a binding agreement among the Company and the Initial
Purchaser in accordance with its terms.
Very truly yours,
AMERICAN EQUITY INVESTMENT
LIFE HOLDING COMPANY
By: /s/ Xxxxx X. Xxxxxxx
----------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Chief Financial Officer and
General Counsel
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
DEUTSCHE BANK SECURITIES INC.
By: /s/ Xxxxxxx Xxxxxxxx
-----------------------------
Name: Xxxxxxx Xxxxxxxx
Title: Director
By: /s/ Xxxxxx Xxxx
-----------------------------
Name: Xxxxxx Xxxx
Title: Managing Director
