Exhibit
10.1


 


FIRST AMENDMENT TO CREDIT
AGREEMENT


 


THIS FIRST AMENDMENT TO CREDIT AGREEMENT (this “First
Amendment”) is made and entered into as of the 15th day of September, 2010, by
and among


 


(i)              AMERICAN EQUITY INVESTMENT LIFE
HOLDING COMPANY, an Iowa corporation, and its successors and assigns (the “Borrower”);
and


 


(ii)             THE FINANCIAL INSTITUTIONS that are
signatory Lender parties hereto and their successors and assigns.


 


Recitals:


 


A.            The Borrower, the “Lenders” party thereto, KeyBank
National Association, in its capacity as Administrative Agent for the Lenders,
and certain other parties are the parties to that certain Credit Agreement
dated as of November 20, 2006 (the “Credit Agreement”), pursuant to which,
inter  alia, the Lenders (as this and other capitalized terms used
herein and not otherwise defined herein are defined in the Credit Agreement)
agreed, subject to the terms and conditions thereof, to advance Loans to the
Borrower.


 


B.            As of the date hereof, the aggregate unpaid principal
balance of the Revolving Loans is $150,000,000.


 


C.            The Borrower has requested certain modifications to the
Credit Agreement, and, subject to the terms and conditions of this First
Amendment, the undersigned Lenders have agreed to grant such request.


 


Agreements:


 


NOW, THEREFORE, in consideration of the foregoing
Recitals and the mutual agreements hereinafter set forth, the parties hereto,
intending to be legally bound, hereby agree as follows:


 

















 


1.             Amendments to Credit Agreement.


 


(a)           The final paragraph of the definition of “Debt” in Section 1.01
(Defined Terms) is hereby amended by deleting therefrom the word “or” before
clause (iii) thereof and by adding the following provision as a new clause
(iv) thereof:


 


or (iv) other than for
the purposes of Section 7(g), any payment obligation under any 2010
Warrants, except to the extent that any such payment obligation, if and when
any such payment obligation may arise, is greater than the amount of any
concurrent payment or payments received by the Borrower in connection with the
termination, cancellation or early unwind of any 2010 Convertible Debt Hedges.


 


(b)           Clause (c) of the definition of “Interest Expense” in
Section 1.01 (Defined Terms) is hereby amended and restated in its
entirety to provide as follows:


 


(c)           non-cash interest expense accrued on the Convertible 2004
Debt and the 2010 Convertible Debt.


 


(c)           The following new defined terms are hereby added to Section 1.01
(Defined Terms) in the appropriate alphabetical order:


 


“2010 Convertible Debt” has the
meaning specified in Section 6.01(a)(vii).


 


“2010
Convertible Debt Documents” means the 2010 Convertible
Debt Indenture, the Borrower’s Convertible Senior Notes Due 2015 issued
thereunder, and related instruments, agreements and other documents, all of
which shall conform to the Existing 2010 Terms, as such documents are amended,
supplemented or otherwise modified from time to time pursuant to this
Agreement.


 


“2010
Convertible Debt Hedges” means each of the call option transaction
confirmation letter agreements to be dated on or about September 15, 2010
(the “2010 Original Hedge Date”) referencing the 2010 Convertible Debt
Documents between the Borrower and one or more financial institutions and any
additional call option transaction confirmation letter agreements referencing
the 2010 Convertible Debt Documents that may be entered into by the Borrower
and one or more financial institutions on or before the 30th day immediately
following the 2010 Original Hedge Date, in each case, substantially in the form
of Exhibit B hereto, as such agreements are amended, supplemented or
otherwise modified from time to time pursuant to this Agreement.


 


“2010
Convertible Debt Indenture” means the Indenture in
respect of the 2010 Convertible Debt to be dated on or about September 20,
2010 by and between the Borrower and U.S. Bank National Association, as
Trustee.


 


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“2010
Warrants” means each of the warrant transaction confirmation
letter agreements to be dated on or about September 15, 2010 (the “2010
Original Warrant Date”) between the Borrower and one or more financial
institutions, and any additional warrant transaction confirmation letter
agreements that may be entered into by the Borrower and one or more financial
institutions on or before the 30th day immediately following the 2010 Original
Warrant Date, in each case, substantially in the form of Exhibit C hereto,
as such agreements are amended, supplemented or otherwise modified from time to
time pursuant to this Agreement.


 


“Existing
2010 Terms” means terms and conditions of the 2010 Convertible
Debt Documents, as described in the draft confidential offering memorandum
delivered by counsel to the Borrower to counsel to the Administrative Agent on September 13,
2010, together with modifications thereto that do not in any material respect (i) increase
the amount of principal evidenced or governed thereby, change (to a date
earlier than December 31, 2014) any date upon which any payment of
principal or interest is due thereon, change any event of default or condition
to an event of default with respect thereto (other than to eliminate or make
less onerous any such event or default or increase any grace period related
thereto), change the redemption, prepayment or defeasance provisions thereof
(other than to eliminate, in whole or in part, or make less onerous such
provisions), or change any collateral therefor (other than to release such
collateral) or (ii) increase in any material respect the obligations of
the Borrower thereunder or to confer any additional rights on the holders of
such Debt (or a trustee or other representative on their behalf).


 


“Shoe
Issuance” has the meaning specified in Section 6.01(a)(vii).


 


(d)           Section 2.10(b) (Mandatory Prepayments) is
hereby amended and restated in its entirety to provide as follows:


 


(b)           Mandatory Prepayments. (i) If
at any date the Total Outstanding Amount exceeds the Total Commitment
calculated as of such date, then not later than the next succeeding Business
Day, the Borrower shall be required to prepay the Loans in an amount equal to
such excess until the Total Outstanding Amount does not exceed the Total
Commitment.


 


(ii)           On each date on which the Borrower receives any proceeds
of any 2010 Convertible Debt, the Borrower shall prepay the Loans in an amount
equal to the lesser of (A) the aggregate then unpaid principal balance of
all of the Loans and (B) the aggregate amount of such proceeds of 2010
Convertible Debt received by the Borrower on such date, net of the cash
consideration paid for the 2010 Convertible Debt Hedges entered into in
connection therewith and of other customary and reasonable commissions, fees
and other expenses (including, without limitation, underwriting discounts and
commissions) incurred by the Borrower in connection with the incurrence of the
2010 Convertible Debt.


 


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(e)           Clause (e) of Section 5.02 (Notice of Material Events) is
hereby amended and restated in its entirety to provide as follows:


 


(e)  at least five Business Days prior to the
effectiveness of any amendment to the terms of the Convertible 2004 Debt or to
the 2010 Convertible Debt, or the effectiveness of any agreement governing any
Debt in replacement or exchange thereof, a copy of such amendment or agreement;


 


(f)          Clause (vii) of Section 6.01(a) (Debt;
Certain Equity Securities) is hereby re-designated to be clause (viii), and the
following provision is hereby added to Section 6.01(a) as a new
clause (vii) thereof:


 


(vii) Debt of $150,000,000 in aggregate
principal amount incurred on or about September 20, 2010 (the “2010
Original Incurrence Date”) by the Borrower plus up to an additional $50,000,000
in aggregate principal amount that may be incurred by Borrower on or before the
30th day immediately following the 2010 Original Incurrence Date (each
incurrence of all or any portion of such additional $50,000,000 aggregate
principal amount being a “Shoe Issuance”), in each case, pursuant to a note
offering exempt from the registration requirements of the Securities Act of
1933, as amended (collectively, the “2010 Convertible Debt”), which 2010
Convertible Debt at all times shall be on terms consistent in all material
respects with the Existing 2010 Terms, and any Debt, not greater than
$200,000,000 in principal amount and otherwise on terms not more restrictive on
or otherwise less favorable to the Borrower in any material respect than the
Existing 2010 Terms, in exchange therefor, whether or not the notes, debentures
or other instruments evidencing such exchange Debt are exempt from such
registration requirements (without limiting the generality of the foregoing, it
is the intention hereby that the terms of the 2010 Convertible Debt, including
the effect of any modification thereof, and the terms of any Debt in exchange
or replacement thereof, (i) provide for a final scheduled maturity not
earlier than September 15, 2015 and (ii) otherwise shall not be more
restrictive on, or otherwise less favorable to, the Borrower in any material
respect than the Existing 2010 Terms); and


 


(g)          Clause (v) of Section 6.04 (Investments, Loans,
Advances, Guarantees and Acquisitions) is hereby amended and restated in its
entirety to provide as follows:


 


(v) Hedging Agreements in the ordinary course
of the Borrower’s or such Subsidiary’s business and any 2010 Convertible Debt
Hedges,


 


(h)         Section 6.15(b) (Amendment of Material Documents;
Prepayments) is hereby amended and restated in its entirety to provide as
follows:


 


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(b)           (i) The Borrower shall not, and shall not permit any
Subsidiary to, enter into any amendment, waiver or other modification of any of
the Convertible 2004 Debt Documents, any of the 2010 Convertible Debt
Documents, any of the Trust Preferred Securities Notes or any indenture or
other agreement governing the Trust Preferred Securities Notes, or of any
document evidencing or otherwise governing any Material Debt (i) if the
effect of such amendment, waiver or other modification is to increase the
interest rate on such Debt, increase the amount of principal due on any date,
change (to earlier dates) any dates upon which payments of principal or
interest are due thereon, change any event of default or condition to an event
of default with respect thereto (other than to eliminate or make less onerous
any such event or default or increase any grace period related thereto), change
the redemption, prepayment or defeasance provisions thereof, or change any
collateral therefor (other than to release such collateral), or (ii) if the
effect of such amendment or change, together with all other amendments or
changes made, is to increase in any material respect the obligations of the
obligor thereunder or to confer any additional rights on the holders of such
Debt (or a trustee or other representative on their behalf).


 


(ii)           The Borrower shall not, and shall not permit any
Subsidiary to, enter into any amendment, waiver or other modification of any of
the 2010 Convertible Debt Hedges or any of the 2010 Warrants (i) if the
effect of such amendment, waiver or other modification is to increase the
amount of any payment in cash due on any date that is earlier than December 31,
2014, change (to a date earlier than December 31, 2014) any dates upon
which any such payment in cash is due thereunder, change any event of default
or termination event or condition to an event of default or termination event
with respect thereto (other than to eliminate or make less onerous any such
event or default or termination event or increase any grace period related
thereto) or (ii) if the effect of such amendment, waiver or other
modification, together with all other amendments, waivers or other
modifications made, is to increase in any material respect the obligations of
the Borrower thereunder or to confer any additional rights on the
counterparties thereto (or a trustee or other representative on their behalf); provided that this clause (ii) shall
not prohibit any amendment to any 2010 Convertible Note Hedge to increase the
number of call options pursuant to such 2010 Convertible Note Hedge that may be
entered into by the Borrower on or before the 30th day immediately following
the 2010 Original Hedge Date in connection with a Shoe Issuance.


 


(i)            The second proviso to paragraph (g) of Article 7
(Events of Default) is hereby amended and restated in its entirety to provide
as follows:


 


provided, further, that none of (A) the
occurrence of an event or condition that requires a mandatory payment of cash,
or the mandatory payment of cash, in each case, required by Section 10.01
of the Indenture described in the definition of Convertible 2004 Debt Documents
(as it provides on the date hereof), (B) the occurrence of an event or
condition that requires a mandatory payment of cash, or the mandatory payment
of cash, in each case, pursuant to the section of the 2010 Convertible Debt
Indenture corresponding to the provisions set forth below the captions “Description
of notes—Conversion rights—Conversion upon satisfaction of sale price
condition,” “—Conversion upon


 


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satisfaction of trading price condition,” “—Conversion
upon specified corporate events,” “—Conversion on or after June 15, 2015”
and “—Settlement upon conversion” of the confidential offering memorandum
referred to in the definition of the Existing 2010 Terms, (C) any event or
condition enabling or pemitting the termination, cancellation or early unwind
of any 2010 Warrants, or any mandatory payment of cash upon any termination,
cancellation or early unwind of any 2010 Warrants to the extent that the amount
of such mandatory payment is less than or equal to the amount of any concurrent
payment or payments received by the Borrower in connection with the
termination, cancellation or early unwind of any 2010 Convertible Debt Hedges,
nor (D) the occurrence of an event or condition that requires a mandatory
prepayment of Material Debt, or the mandatory prepayment of Material Debt, in
each case, required to be made by reason of the sale or other disposition
(including, without limitation, condemnation or insured casualty) of assets
securing such Material Debt, shall be deemed to be an event or condition
described in any of clauses (i), (ii) and (iii) above;


 


(j)            The forms of (i) a 2010 Convertible Debt Hedge and (ii) a
2010 Warrant attached hereto are hereby added as new Exhibits B and C,
respectively, of the Credit Agreement.


 


2.             Amendment
Effective Date; Conditions Precedent. The amendments set forth in Paragraph
1, above, shall not be effective unless and until the date on which all of the
following conditions precedent have been satisfied (such date of effectiveness
being the “First Amendment Effective Date”):


 


(a)           Officer’s
Certificate. On the First Amendment Effective Date and after giving effect
to the amendments set forth in Paragraph 1, above, (i) there shall exist
no Default, and a Financial Officer or other executive officer of the Borrower,
on behalf of the Borrower, shall have delivered to the Administrative Agent
written confirmation thereof dated as of the First Amendment Effective Date,
and (ii) the representations and warranties of the Borrower under Article 3
of the Credit Agreement shall have been reaffirmed in writing by a Financial
Officer or other executive officer of the Borrower, on behalf of the Borrower,
as being true and correct in all material respects as of the First Amendment
Effective Date (unless and to the extent that any such representation and
warranty is stated to relate solely to an earlier date, in which case such
representation and warranty shall be true and correct as of such earlier date).


 


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(b)         First Amendment. The Administrative Agent (or its
counsel) shall have received from the Borrower and from Lenders sufficient to
constitute the Required Lenders either (i) a counterpart of this First
Amendment signed on behalf of such party or (ii) written evidence
satisfactory to the Administrative Agent (which may include telecopy
transmission of a signed signature page of this First Amendment) that such
party has signed a counterpart of this First Amendment.


 


(c)          Corporate Authorization. The Borrower shall have
delivered to the Administrative Agent a copy, certified by its Secretary or
Assistant Secretary, of its Board of Directors’ resolutions authorizing the
execution and delivery of this First Amendment and the transactions
contemplated hereby.


 


(d)         Agent Expenses. The Borrower shall have paid or
caused to be paid to the Administrative Agent on or prior to the First
Amendment Effective Date, to the extent then invoiced, all reasonable
out-of-pocket expenses, including fees, charges and disbursements of its
special counsel, Squire, Sanders & Dempsey L.L.P. (the “Special
Counsel”), required to be reimbursed or paid by the Borrower hereunder or under
any other Loan Document.


 


(e)          Other Matters. The Administrative Agent shall have
received such other certificates, opinions and documents, in form and substance
reasonably satisfactory to the Administrative Agent, as the Administrative
Agent may reasonably request.


 


3.           No Modifications. Except as expressly provided in
this First Amendment, all of the terms and conditions of the Credit Agreement
and the other Loan Documents remain unchanged and in full force and effect.


 


4.           Confirmation of Obligations. The Borrower hereby
confirms that, as of the date hereof, the Borrower is indebted to the Lenders
for the Loans in the amounts and as of the date


 


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set forth in Recital B, above, and is also obligated to the Lenders in
respect of other obligations as set forth in the Credit Agreement and the other
Loan Documents. The Borrower further acknowledges and agrees that as of the
date hereof, it has no claim, defense or set-off right against any Lender or
the Administrative Agent of any nature whatsoever, whether sounding in tort,
contract or otherwise, and has no claim, defense or set-off of any nature
whatsoever to the enforcement by any Lender or the Administrative Agent of the
full amount of the Loans and other obligations of the Borrower under the Credit
Agreement and the other Loan Documents.


 


5.           Administrative Agent’s Expense. The Borrower agrees
to reimburse the Administrative Agent promptly for its reasonable documented
out-of-pocket costs and expenses incurred in connection with this First
Amendment and the transactions contemplated hereby, including, without
limitation (but without duplication of fees and expenses paid pursuant to Section 2(d) above),
the reasonable fees and expenses of the Special Counsel.


 


6.           Governing Law; Binding Effect. This First Amendment
shall be governed by and construed in accordance with the laws of the State of
New York and shall be binding upon and inure to the benefit of the Borrower,
the Lenders and the Administrative Agent and their respective successors and
assigns.


 


7.           Counterparts. This First Amendment may be executed
in any number of counterparts, each of which when so executed shall be deemed
to be an original, but all such counterparts shall constitute one and the same
instrument, and all signatures need not appear on any one counterpart. Any
party hereto may execute and deliver a counterpart of this First Amendment by
delivering by facsimile or email transmission a signature page of this
First Amendment signed by such party, and any such facsimile or email signature
shall be treated in all respects as having the same effect as an original
signature. Any party delivering by


 


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facsimile or email transmission a counterpart executed by it shall
promptly thereafter also deliver a manually signed counterpart of this First
Amendment; provided that any failure to deliver such manually signed
counterpart shall not affect the effectiveness of this First Amendment or the
consent of such party to the First Amendment and the provisions contained
herein.


 


8.           Miscellaneous.


 


(a)           Upon the effectiveness of this First Amendment, this First
Amendment shall be a Loan Document.


 


(b)           The invalidity, illegality, or unenforceability of any
provision in or Obligation under this First Amendment in any jurisdiction shall
not affect or impair the validity, legality, or enforceability of the remaining
provisions or obligations under this First Amendment or of such provision or
obligation in any other jurisdiction.


 


(c)           This First Amendment and all other agreements and
documents executed in connection herewith have been prepared through the joint
efforts of all of the parties. Neither the provisions of this First Amendment
or any such other agreements and documents nor any alleged ambiguity shall be
interpreted or resolved against any party on the ground that such party’s
counsel drafted this First Amendment or such other agreements and documents, or
based on any other rule of strict construction. Each of the parties hereto
represents and declares that such party has carefully read this First Amendment
and all other agreements and documents executed in connection herewith and
therewith, and that such party knows the contents thereof and signs the same
freely and voluntarily. The parties hereby acknowledge that they have been
represented by legal counsel of their own choosing in negotiations for and
preparation of this First Amendment and all other agreements and documents
executed in connection therewith and


 


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that each of them has read the same and had their contents fully
explained by such counsel and is fully aware of their contents and legal
effect.


 


10.          Waiver of Jury Trial. EACH OF THE PARTIES TO THIS
FIRST AMENDMENT HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR
COUNTERCLAIM (WHETHER SOUNDING IN CONTRACT, TORT OR OTHER THEORY) ARISING OUT
OF OR RELATING TO THIS FIRST AMENDMENT, THE OTHER LOAN DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY. EACH PARTY HERETO HEREBY (A) CERTIFIES
THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF
LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, AND (B) ACKNOWLEDGES
THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS FIRST
AMENDMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATION IN THIS
SECTION.


 


[No additional provisions
are on this page; the page next following is a signature page.]


 


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IN WITNESS WHEREOF, the parties hereto have hereunto
set their hands as of the date first above written.


 


	
   

  	
  BORROWER

  
	
   

  	
   

  
	
   

  	
  AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John M. Matovina

  
	
   

  	
   

  	
  John M. Matovina

  
	
   

  	
   

  	
  Chief Financial Officer and Treasurer

  



 


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  LENDERS

  
	
   

  	
   

  
	
   

  	
  KEYBANK NATIONAL ASSOCIATION,

  as Lender

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Mary K. Young

  
	
   

  	
   

  	
  Mary K. Young

  
	
   

  	
   

  	
  Senior Vice President

  



 


12

















 


	
  [Lender Signatures
  Continued]

  
	
   

  	
   

  
	
   

  	
  BANKERS TRUST COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John M. Doll

  
	
   

  	
   

  	
  John M. Doll

  
	
   

  	
   

  	
  Vice President

  



 


13

















 


	
  [Lender Signatures
  Continued]

  
	
   

  	
   

  
	
   

  	
  JPMORGAN CHASE BANK, NATIONAL ASSOCIATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Thomas A. Kiepura

  
	
   

  	
   

  	
  Thomas A. Kiepura

  
	
   

  	
   

  	
  Vice President

  



 


14

















 


	
  [Lender Signatures
  Continued]

  
	
   

  	
   

  
	
   

  	
  SUNTRUST BANK

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ K. Scott Bazemore

  
	
   

  	
   

  	
  K. Scott Bazemore

  
	
   

  	
   

  	
  Vice President

  



 


15

















 


	
  [Lender Signatures
  Continued]

  
	
   

  	
   

  
	
   

  	
  WEST BANK

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Kevin S. Smith

  
	
   

  	
   

  	
  Kevin S. Smith

  
	
   

  	
   

  	
  Sr. Vice President

  



 


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  AGENT ACKNOWLEDGMENT:

  
	
   

  	
   

  
	
   

  	
  The Administrative Agent hereby acknowledges its receipt of the
  foregoing First Amendment as of the date first above written.

  
	
   

  	
   

  
	
   

  	
  KEYBANK NATIONAL ASSOCIATION, as Administrative Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Mary K. Young

  
	
   

  	
   

  	
  Mary K. Young

  
	
   

  	
   

  	
  Senior Vice President

  



 


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