Document:

Exhibit 4.13

 

 

 

JUNIOR SUBORDINATED INDENTURE

 

between

 

 

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

 

 

and

 

 

JPMORGAN CHASE BANK,

as Trustee

 

 

 

 

Dated
as of April 29, 2004

 

 

 

 

TABLE OF CONTENTS

 

	
  ARTICLE I

  
	
  Definitions
  and Other Provisions of General Application

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 1.1.

  	
   

  	
  Definitions

  	
   

  
	
  Section 1.2.

  	
   

  	
  Compliance
  Certificate and Opinions

  	
   

  
	
  Section 1.3.

  	
   

  	
  Forms
  of Documents Delivered to Trustee

  	
   

  
	
  Section 1.4.

  	
   

  	
  Acts of Holders

  	
   

  
	
  Section 1.5.

  	
   

  	
  Notices, Etc. to Trustee and Company

  	
   

  
	
  Section 1.6.

  	
   

  	
  Notice to
  Holders; Waiver

  	
   

  
	
  Section 1.7

  	
   

  	
  Effect
  of Headings and Table of Contents

  	
   

  
	
  Section 1.8.

  	
   

  	
  Successors
  and Assigns

  	
   

  
	
  Section 1.9.

  	
   

  	
  Separability
  Clause

  	
   

  
	
  Section 1.10.

  	
   

  	
  Benefits of
  Indenture

  	
   

  
	
  Section 1.11.

  	
   

  	
  Governing Law

  	
   

  
	
  Section 1.12.

  	
   

  	
  Submission
  to Jurisdiction

  	
   

  
	
  Section 1.13.

  	
   

  	
  Non-Business
  Days

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II

  
	
  Security
  Forms

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 2.1.

  	
   

  	
  Form of Security

  	
   

  
	
  Section 2.2.

  	
   

  	
  Restricted Legend

  	
   

  
	
  Section 2.3.

  	
   

  	
  Form
  of Trustee’s Certificate of Authentication

  	
   

  
	
  Section 2.4.

  	
   

  	
  Temporary
  Securities

  	
   

  
	
  Section 2.5.

  	
   

  	
  Definitive
  Securities

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III

  
	
  The
  Securities

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 3.1

  	
   

  	
  Payment
  of Principal and Interest

  	
   

  
	
  Section 3.2.

  	
   

  	
  Denominations

  	
   

  
	
  Section 3.3.

  	
   

  	
  Execution,
  Authentication, Delivery and Dating

  	
   

  
	
  Section 3.4.

  	
   

  	
  Global Securities

  	
   

  
	
  Section 3.5

  	
   

  	
  Registration,
  Transfer and Exchange Generally

  	
   

  
	
  Section 3.6.

  	
   

  	
  Mutilated,
  Destroyed, Lost and Stolen Securities

  	
   

  
	
  Section 3.7

  	
   

  	
  Persons
  Deemed Owners

  	
   

  

 

i

 

	
  Section 3.8.

  	
   

  	
  Cancellation

  	
   

  
	
  Section 3.9.

  	
   

  	
  Deferrals
  of Interest Payment Dates

  	
   

  
	
  Section 3.10.

  	
   

  	
  Right of Set-Off

  	
   

  
	
  Section 3.11.

  	
   

  	
  Agreed Tax
  Treatment

  	
   

  
	
  Section 3.12.

  	
   

  	
  CUSIP Numbers

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV

  
	
  Satisfaction and Discharge

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 4.1.

  	
   

  	
  Satisfaction
  and Discharge of Indenture

  	
   

  
	
  Section 4.2.

  	
   

  	
  Application
  of Trust Money

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V

  
	
  Remedies

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 5.1.

  	
   

  	
  Events of Default

  	
   

  
	
  Section 5.2.

  	
   

  	
  Acceleration
  of Maturity; Rescission and Annulment

  	
   

  
	
  Section 5.3.

  	
   

  	
  Collection
  of Indebtedness and Suits for Enforcement by Trustee

  	
   

  
	
  Section 5.4.

  	
   

  	
  Trustee
  May File Proofs of Claim

  	
   

  
	
  Section 5.5.

  	
   

  	
  Trustee
  May Enforce Claim Without Possession of Securities

  	
   

  
	
  Section 5.6.

  	
   

  	
  Application
  of Money Collected

  	
   

  
	
  Section 5.7.

  	
   

  	
  Limitation on
  Suits

  	
   

  
	
  Section 5.8.

  	
   

  	
  Unconditional
  Right of Holders to Receive Principal, Premium, if any,and Interest; Direct
  Action by Holders of Preferred Securities

  	
   

  
	
  Section 5.9.

  	
   

  	
  Restoration
  of Rights and Remedies

  	
   

  
	
  Section 5.10.

  	
   

  	
  Rights
  and Remedies Cumulative

  	
   

  
	
  Section 5.11.

  	
   

  	
  Delay
  or Omission Not Waiver

  	
   

  
	
  Section 5.12.

  	
   

  	
  Control by
  Holders

  	
   

  
	
  Section 5.13.

  	
   

  	
  Waiver of
  Past Defaults

  	
   

  
	
  Section 5.14.

  	
   

  	
  Undertaking
  for Costs

  	
   

  
	
  Section 5.15.

  	
   

  	
  Waiver of Usury,
  Stay or Extension Laws

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI

  
	
  The Trustee

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 6.1.

  	
   

  	
  Corporate
  Trustee Required

  	
   

  
	
  Section 6.2.

  	
   

  	
  Certain
  Duties and Responsibilities

  	
   

  

 

ii

 

	
  Section 6.3.

  	
   

  	
  Notice of
  Defaults

  	
   

  
	
  Section 6.4.

  	
   

  	
  Certain
  Rights of Trustee

  	
   

  
	
  Section 6.5.

  	
   

  	
  May Hold
  Securities

  	
   

  
	
  Section 6.6.

  	
   

  	
  Compensation;
  Reimbursement; Indemnity

  	
   

  
	
  Section 6.7.

  	
   

  	
  Resignation
  and Removal; Appointment of Successor

  	
   

  
	
  Section 6.8.

  	
   

  	
  Acceptance
  of Appointment by Successor

  	
   

  
	
  Section 6.9.

  	
   

  	
  Merger, Conversion,
  Consolidation or Succession to Business

  	
   

  
	
  Section 6.10.

  	
   

  	
  Not
  Responsible for Recitals or Issuance of Securities

  	
   

  
	
  Section 6.11.

  	
   

  	
  Appointment
  of Authenticating Agent

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VII

  
	
  Holder’s Lists
  and Reports by Company

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 7.1.

  	
   

  	
  Company
  to Furnish Trustee Names and Addresses of Holders

  	
   

  
	
  Section 7.2.

  	
   

  	
  Preservation
  of Information, Communications to Holders

  	
   

  
	
  Section 7.3.

  	
   

  	
  Reports by
  Company

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VIII

  
	
  Consolidation,
  Merger, Conveyance, Transfer or Lease

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 8.1.

  	
   

  	
  Company May
  Consolidate, Etc., Only on Certain Terms

  	
   

  
	
  Section 8.2.

  	
   

  	
  Successor
  Company Substituted

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IX

  
	
  Supplemental Indentures

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 9.1.

  	
   

  	
  Supplemental
  Indentures without Consent of Holders

  	
   

  
	
  Section 9.2.

  	
   

  	
  Supplemental
  Indentures with Consent of Holders

  	
   

  
	
  Section 9.3.

  	
   

  	
  Execution
  of Supplemental Indentures

  	
   

  
	
  Section 9.4.

  	
   

  	
  Effect
  of Supplemental Indentures

  	
   

  
	
  Section 9.5.

  	
   

  	
  Reference
  in Securities to Supplemental Indentures

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE X

  
	
  Covenants

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 10.1.

  	
   

  	
  Payment of
  Principal, Premium, if any, and Interest

  	
   

  
	
  Section 10.2.

  	
   

  	
  Money
  for Security Payments to be Held in Trust

  	
   

  
	
  Section 10.3.

  	
   

  	
  Statement
  as to Compliance

  	
   

  
	
  Section 10.4.

  	
   

  	
  Calculation
  Agent

  	
   

  

 

iii

 

	
  Section 10.5.

  	
   

  	
  Additional Tax
  Sums

  	
   

  
	
  Section 10.6.

  	
   

  	
  Additional
  Covenants

  	
   

  
	
  Section 10.7.

  	
   

  	
  Waiver of
  Covenants

  	
   

  
	
  Section 10.8.

  	
   

  	
  Treatment
  of Securities

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XI

  
	
  Redemption of Securities

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 11.1.

  	
   

  	
  Optional
  Redemption

  	
   

  
	
  Section 11.2.

  	
   

  	
  Special
  Event Redemption

  	
   

  
	
  Section 11.3.

  	
   

  	
  Election
  to Redeem; Notice to Trustee

  	
   

  
	
  Section 11.4.

  	
   

  	
  Selection
  of Securities to be Redeemed

  	
   

  
	
  Section 11.5.

  	
   

  	
  Notice of
  Redemption

  	
   

  
	
  Section 11.6.

  	
   

  	
  Deposit
  of Redemption Price

  	
   

  
	
  Section 11.7.

  	
   

  	
  Payment
  of Securities Called for Redemption

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE XII

  
	
  Subordination of
  Securities

  
	
   

  	
   

  	
   

  	
   

  
	
  Section 12.1.

  	
   

  	
  Securities
  Subordinate to Senior Debt

  	
   

  
	
  Section 12.2.

  	
   

  	
  No
  Payment When Senior Debt in Default; Payment Over of Proceeds Upon
  Dissolution, Etc

  	
   

  
	
  Section 12.3.

  	
   

  	
  Payment
  Permitted If No Default

  	
   

  
	
  Section 12.4.

  	
   

  	
  Subrogation
  to Rights of Holders of Senior Debt

  	
   

  
	
  Section 12.5.

  	
   

  	
  Provisions
  Solely to Define Relative Rights

  	
   

  
	
  Section 12.6.

  	
   

  	
  Trustee
  to Effectuate Subordination

  	
   

  
	
  Section 12.7.

  	
   

  	
  No
  Waiver of Subordination Provisions

  	
   

  
	
  Section 12.8.

  	
   

  	
  Notice to
  Trustee

  	
   

  
	
  Section 12.9.

  	
   

  	
  Reliance
  on Judicial Order or Certificate of Liquidating Agent

  	
   

  
	
  Section 12.10.

  	
   

  	
  Trustee
  Not Fiduciary for Holders of Senior Debt

  	
   

  
	
  Section 12.11.

  	
   

  	
  Rights
  of Trustee as Holder of Senior Debt; Preservation of Trustee’s Rights

  	
   

  
	
  Section 12.12.

  	
   

  	
  Article Applicable
  to Paying Agents

  	
   

  

 

iv

 

TABLE OF CONTENTS

 

SCHEDULES

 

	
  Schedule A

  	
  –

  	
  Determination
  of LIBOR

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Exhibit
  A

  	
  -

  	
  Form of
  Officer’s Financial Certificate

  	
   

  

 

i

 

JUNIOR
SUBORDINATED INDENTURE, dated as of April 29, 2004, between AMERICAN
EQUITY INVESTMENT LIFE HOLDING COMPANY, an Iowa corporation (the “Company”), and JPMORGAN CHASE BANK, a New York banking
corporation, as Trustee (in such capacity, the “Trustee”).

 

RECITALS
OF THE COMPANY

 

WHEREAS,
the Company has duly authorized the execution and delivery of this Indenture to
provide for the issuance of its unsecured junior subordinated deferrable
interest notes (the “Securities”) issued
to evidence loans made to the Company of the proceeds from the issuance by
American Equity Capital Trust III, a Delaware statutory trust (the “Trust”), of undivided preferred beneficial interests in the
assets of the Trust (the “Preferred Securities”) and
undivided common beneficial interests in the assets of the Trust (the “Common Securities” and, collectively with the Preferred
Securities, the “Trust Securities”), and to
provide the terms and conditions upon which the Securities are to be
authenticated, issued and delivered; and

 

WHEREAS,
all things necessary to make this Indenture a valid agreement of the Company,
in accordance with its terms, have been done.

 

NOW,
THEREFORE, this Indenture Witnesseth:

 

For and
in consideration of the premises and the purchase of the Securities by the
Holders thereof, it is mutually covenanted and agreed, for the equal and
proportionate benefit of all Holders of the Securities, as follows:

 

ARTICLE I

 

DEFINITIONS
AND OTHER PROVISIONS OF GENERAL APPLICATION

 

SECTION 1.1. Definitions.

 

For all
purposes of this Indenture, except as otherwise expressly provided or unless
the context otherwise requires:

 

(a)
the terms defined in this Article I have the meanings assigned to
them in this Article I;

 

(b)
the words “include”, “includes” and “including” shall be deemed to be followed
by the phrase “without limitation”;

 

(c)
all accounting terms not otherwise defined herein have the meanings assigned to
them in accordance with GAAP;

 

(d)
unless the context otherwise requires, any reference to an “Article” or a “Section”
refers to an Article or a Section, as the case may be, of this Indenture;

 

(e)
the words “hereby”, “herein”, “hereof’ and “hereunder” and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision;

 

1

 

(f)
a reference to the singular includes the plural and vice versa; and

 

(g)
the masculine, feminine or neuter genders used herein shall include the
masculine, feminine and neuter genders.

 

“Act” when
used with respect to any Holder, has the meaning specified in Section 1.4.

 

“Administrative Trustee” means, with respect to the Trust, each Person
identified as an “Administrative Trustee” in the Trust Agreement, solely in its
capacity as Administrative Trustee of the Trust under the Trust Agreement and
not in its individual capacity, or its successor in interest in such capacity,
or any successor Administrative Trustee appointed as therein provided.

 

“Additional Interest” means the interest, if any, that shall accrue on any
amounts payable on the Securities, the payment of which has not been made on
the applicable Interest Payment Date and which shall accrue at the rate per
annum specified or determined as specified in such Security, in each case to
the extent legally enforceable.

 

“Additional Tax Sums” has the meaning specified in Section 10.5.

 

“Additional Taxes” means taxes, duties or other governmental charges imposed on the Trust as a
result of a Tax Event (which, for the sake of clarity, does not include amounts
required to be deducted or withheld by the Trust from payments made by the
Trust to or for the benefit of the Holder of, or any Person that acquires a
beneficial interest in, the Securities).

 

“Affiliate” of
any specified Person means any other Person directly or indirectly controlling
or controlled by or under direct or indirect common control with such specified
Person. For the purposes of this definition, “control,” when used with respect
to any specified Person, means the power to direct the management and policies
of such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms “controlling” and “controlled”
have meanings correlative to the foregoing.

 

“Applicable Accounting Principles” means accounting practices prescribed or permitted by
the National Association of Insurance Commissioners and, with respect to the
Company’s subsidiary insurance companies, the applicable insurance department
of the state of domicile of such insurance subsidiary, and in each case,
applied consistently throughout the periods involved.

 

“Applicable Depository Procedures” means, with respect to any transfer or transaction
involving a Global Security or beneficial interest therein, the rules and
procedures of the Depositary for such Security, in each case to the extent
applicable to such transaction and as in effect from time to time.

 

“Applicable Insurance Regulatory Authority” means the Iowa Insurance Division or, if at any time
after the execution of this Indenture any such entity is not existing and
performing the duties now assigned to it, any successor body performing similar
duties or functions.

 

“Authenticating Agent” means any Person authorized by the Trustee pursuant to Section 6.11
to act on behalf of the Trustee to authenticate the Securities.

 

2

 

“Bankruptcy Code” means Title 11 of the United States Code or any successor statute(s)
thereto, or any similar federal or state law for the relief of debtors, in each
case as amended from time to time.

 

“Board of Directors” means the board of directors of the Company or any duly authorized
committee of that board.

 

“Board Resolution” means a copy of a resolution certified by the Secretary or an Assistant
Secretary of the Company to have been duly adopted by the Board of Directors
and to be in full force and effect on the date of such certification.

 

“Business Day” means any day other than (i) a Saturday or Sunday, (ii) a day on which
banking institutions in the City of New York are authorized or required by law
or executive order to remain closed or (iii) a day on which the Corporate Trust
Office of the Trustee is closed for business.

 

“Calculation Agent” has the meaning specified in Section 10.4.

 

“Common Securities” has the meaning specified in the first recital of this Indenture. 

 

“Common Stock” means the common stock, par value $1.00 per share, of the Company.

 

“Company” means
the Person named as the “Company” in
the first paragraph of this Indenture until a successor corporation shall have
become such pursuant to the applicable provisions of this Indenture, and
thereafter “Company” shall mean such successor
corporation.

 

“Company Request” and “Company Order” mean, respectively, the
written request or order signed in the name of the Company by its Chairman of
the Board of Directors, its Vice Chairman of the Board of Directors, its Chief
Executive Officer, President or a Vice President, and by its Chief Financial
Officer, its Treasurer, an Assistant Treasurer, its Secretary or an Assistant
Secretary, and delivered to the Trustee.

 

“Corporate Trust Office” means the principal office of the Trustee at which at
any particular time its corporate trust business shall be administered, which
office at the date of this Indenture is located at 600 Travis, 50th
Floor, Houston, Texas 77002, Attn: Institutional Trust Services, American
Equity Capital Trust III.

 

“Debt” means,
with respect to any Person, whether recourse is to all or a portion of the
assets of such Person, whether currently existing or hereafter incurred and
whether or not contingent and without duplication, (i) every obligation of such
Person for money borrowed; (ii) every obligation of such Person evidenced by
bonds, debentures, notes or other similar instruments, including obligations
incurred in connection with the acquisition of property, assets or businesses;
(iii) every reimbursement obligation of such Person with respect to letters of
credit, bankers’ acceptances or similar facilities issued for the account of
such Person; (iv) every obligation of such Person issued or assumed as the
deferred purchase price of property or services (but excluding trade accounts
payable or other accrued liabilities arising in the ordinary course of
business); (v) every capital lease obligation of such Person; (vi) all
indebtedness of such Person, whether incurred on or prior to the date of this
Indenture or thereafter incurred, for claims in respect of derivative products,
including interest rate, foreign exchange rate and

 

3

 

commodity
forward contracts, options and swaps and similar arrangements; (vii) every obligation
of the type referred to in clauses (i) through (vi) of another Person and all
dividends of another Person the payment of which, in either case, such Person
has guaranteed or is responsible or liable for, directly or indirectly, as
obligor or otherwise; and (viii) any renewals, extensions, refundings,
amendments or modifications of any obligation of the type referred to in
clauses (i) through (vii).

 

“Defaulted Interest” has the meaning specified in Section 3.1.

 

“Delaware Trustee” means, with respect to the Trust, the Person identified as the “Delaware
Trustee” in the Trust Agreement, solely in its capacity as Delaware Trustee of
the Trust under the Trust Agreement and not in its individual capacity, or its
successor in interest in such capacity, or any successor Delaware Trustee
appointed as therein provided.

 

“Depositary” means
an organization registered as a clearing agency under the Exchange Act that is
designated as Depositary by the Company or any successor thereto. DTC will be
the initial Depositary.

 

“Depositary Participant” means a broker, dealer, bank, other financial
institution or other Person for whom from time to time a Depositary effects
book-entry transfers and pledges of securities deposited with the Depositary.

 

“Distributions” means amounts payable in respect of the Trust Securities as provided in the
Trust Agreement and referred to therein as “Distributions.”

 

“Dollar” or “$”
means the currency of the United States of America that, as at the time of
payment, is legal tender for the payment of public and private debts.

 

“DTC” means
The Depository Trust Company, a New York corporation, or any successor thereto.

 

“Event of Default” has the meaning specified in Section 5.1.

 

“Exchange Act” means the Securities Exchange Act of 1934 or any statute successor thereto,
in each case as amended from time to time.

 

“Expiration Date” has the meaning specified in Section 1.4.

 

“Extension Period” has the meaning specified in Section 3.9.

 

“GAAP” means
United States generally accepted accounting principles, consistently applied,
from time to time in effect.

 

“Global Security” means a Security that evidences all or part of the Securities, the
ownership and transfers of which shall be made through book entries by a
Depositary.

 

“Government Obligation” means (a) any security that is (i) a direct obligation
of the United States of America of which the full faith and credit of the
United States of America is pledged or (ii) an obligation of a Person
controlled or supervised by and acting as an agency or

 

4

 

instrumentality
of the United States of America or the payment of which is unconditionally
guaranteed as a full faith and credit obligation by the United States of
America, which, in either case (i) or (ii), is not callable or redeemable at
the option of the issuer thereof, and (b) any depositary receipt issued by a
bank (as defined in Section 3(a)(2) of the Securities Act) as custodian
with respect to any Government Obligation that is specified in clause (a) above
and held by such bank for the account of the holder of such depositary receipt,
or with respect to any specific payment of principal of or interest on any
Government Obligation that is so specified and held, provided, that
(except as required by law) such custodian is not authorized to make any
deduction from the amount payable to the holder of such depositary receipt from
any amount received by the custodian in respect of the Government Obligation or
the specific payment of principal or interest evidenced by such depositary
receipt.

 

“Guarantee Agreement” means the Guarantee Agreement executed by the Company
and JPMorgan Chase Bank, as Guarantee Trustee, contemporaneously with the
execution and delivery of this Indenture, for the benefit of the holders of the
Preferred Securities, as modified, amended or supplemented from time to time.

 

“Holder” means
a Person in whose name a Security is registered in the Securities Register.

 

“Indenture” means
this instrument as originally executed or as it may from time to time be
amended or supplemented by one or more amendments or indentures supplemental
hereto entered into pursuant to the applicable provisions hereof.

 

“Interest Payment Date” means February 15, May 15, August 15, and November 15
of each year, commencing on August 15, 2004, during the term of this
Indenture.

 

“Investment Company Act” means the Investment Company Act of 1940 or any
successor statute thereto, in each case as amended from time to time.

 

“Investment Company Event” means the receipt by the Company of an Opinion of
Counsel experienced in such matters to the effect that, as a result of the
occurrence of a change in law or regulation (including any announced
prospective change) or a written change in interpretation or application of law
or regulation by any legislative body, court, governmental agency or regulatory
authority, there is more than an insubstantial risk that the Trust is or,
within ninety (90) days of the date of such opinion will be, considered an “investment
company” that is required to be registered under the Investment Company Act,
which change or prospective change becomes effective or would become effective,
as the case may be, on or after the date of the issuance of the Securities.

 

“LIBOR” has
the meaning specified in Schedule A.

 

“LIBOR Business Day” has the meaning specified in Schedule A.

 

“LIBOR Determination Date” has the meaning specified in Schedule A.

 

“Liquidation Amount” has the meaning specified in the Trust Agreement.

 

5

 

“Maturity,” when
used with respect to any Security, means the date on which the principal of
such Security or any installment of principal becomes due and payable as
therein or herein provided, whether at the Stated Maturity or by declaration of
acceleration, call for redemption or otherwise.

 

“Notice of Default” means a written notice of the kind specified in Section 5.1(c).

 

“Officers’ Certificate” means a certificate signed by the Chairman of the
Board, a Vice Chairman of the Board, the Chief Executive Officer, the President
or a Vice President, and by the Chief Financial Officer, the Treasurer, an
Assistant Treasurer, the Secretary or an Assistant Secretary, of the Company
and delivered to the Trustee.

 

“Operative Documents” means the Trust Agreement, the Indenture, the Purchase
Agreement, the Guarantee Agreement and the Securities.

 

“Opinion of Counsel” means a written opinion of counsel, who may be counsel for or an employee
of the Company or any Affiliate of the Company.

 

“Optional Redemption Price” has the meaning set forth in Section 11.1.

 

“Original Issue Date” means the date of original issuance of each Security.

 

“Outstanding” means, when used in reference to any Securities, as of the date of
determination, all Securities theretofore authenticated and delivered under
this Indenture, except:

 

(i)
Securities theretofore canceled by the Trustee or delivered to the Trustee for
cancellation;

 

(ii)
Securities for whose payment or redemption money in the necessary amount has
been theretofore deposited with the Trustee or any Paying Agent (other than the
Company) in trust or set aside and segregated in trust by the Company (if the
Company shall act as its own Paying Agent) for the Holders of such Securities; provided, that, if such Securities are to be redeemed,
notice of such redemption has been duly given pursuant to this Indenture or
provision therefor satisfactory to the Trustee has been made; and

 

(iii)
Securities that have been paid or in substitution for or in lieu of which other
Securities have been authenticated and delivered pursuant to the provisions of
this Indenture, unless proof satisfactory to the Trustee is presented that any
such Securities are held by Holders in whose hands such Securities are valid,
binding and legal obligations of the Company;

 

provided, that, in determining whether the Holders of the
requisite principal amount of Outstanding Securities have given any request,
demand, authorization, direction, notice, consent or waiver hereunder,
Securities owned by the Company or any other obligor upon the Securities or any
Affiliate of the Company or such other obligor shall be disregarded and deemed
not to be Outstanding, except that, in determining whether the Trustee shall be
protected in relying upon any such request, demand, authorization, direction,
notice, consent or waiver, only Securities that a Responsible Officer of the
Trustee actually knows to be so owned shall be so disregarded.

 

6

 

Securities
so owned that have been pledged in good faith may be regarded as Outstanding if
the pledgee establishes to the satisfaction of the Trustee the pledgee’s right
so to act with respect to such Securities and that the pledgee is not the
Company or any other obligor upon the Securities or any Affiliate of the
Company or such other obligor. Notwithstanding anything herein to the contrary,
Securities initially issued to the Trust that are owned by the Trust shall be
deemed to be Outstanding notwithstanding the ownership by the Company or an
Affiliate of any beneficial interest in the Trust.

 

“Paying Agent” means the Trustee or any Person authorized by the Company to pay the
principal of or any premium or interest on, or other amounts in respect of, any
Securities on behalf of the Company.

 

“Person” means
a legal person, including any individual, corporation, estate, partnership,
joint venture, association, joint stock company, limited liability company,
trust, unincorporated association, government or any agency or political
subdivision thereof, or any other entity of whatever nature.

 

“Place of Payment” means, with respect to the Securities, the Corporate Trust Office of the
Trustee.

 

“Preferred Securities” has the meaning specified in the first recital of this
Indenture.

 

“Predecessor Security” of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security. For the purposes of this definition, any security
authenticated and delivered under Section 3.6 in lieu of a mutilated,
destroyed, lost or stolen Security shall be deemed to evidence the same debt as
the mutilated, destroyed, lost or stolen Security.

 

“Proceeding” has
the meaning specified in Section 12.2.

 

“Property Trustee” means the Person identified as the “Property Trustee” in the Trust
Agreement, solely in its capacity as Property Trustee of the Trust under the
Trust Agreement and not in its individual capacity, or its successor in
interest in such capacity, or any successor Property Trustee appointed as
therein provided.

 

“Purchase Agreement” means the agreement, dated as of the date hereof, between the Company and
the Trust and Cohen Bros. & Company.

 

“Redemption Date” means, when used with respect to any Security to be redeemed, the date
fixed for such redemption by or pursuant to this Indenture.

 

“Redemption Price” means, when used with respect to any Security to be redeemed, in whole or
in part, the Special Redemption Price or the Optional Redemption Price, as
applicable, at which such Security or portion thereof is to be redeemed as
fixed by or pursuant to this Indenture.

 

“Reference Banks” has the meaning specified in Schedule A.

 

7

 

“Regular Record Date” for the interest payable on any interest Payment Date
with respect to the Securities means the date that is fifteen (15) days
preceding such Interest Payment Date (whether or not a Business Day).

 

“Responsible Officer” means, when used with respect to the Trustee, the
officer in the Institutional Trust Services department of the Trustee having
direct responsibility for the administration of this Indenture.

 

“Rights Plan” means a plan of the Company providing for the issuance by the Company to
all holders of its Common Stock of rights entitling the holders thereof to
subscribe for or purchase shares of any class or series of capital stock of the
Company which rights (i) are deemed to be transferred with such shares of such
Common Stock and (ii) are also issued in respect of future issuances of such
Common Stock, in each case until the occurrence of a specified event or events.

 

“Securities” or
“Security means any debt securities or
debt security, as the case may be, authenticated and delivered under this
Indenture.

 

“Securities Act” means the Securities Act of 1933 or any successor statute thereto, in each
case as amended from time to time.

 

“Securities Register” and “Securities Registrar” have
the respective meanings specified in Section 3.5.

 

“Senior Debt” means the principal of and any premium and interest on (including interest
accruing on or after the filing of any petition in bankruptcy or for
reorganization relating to the Company, whether or not such claim for
post-petition interest is allowed in such proceeding) all Debt of the Company,
whether incurred on or prior to the date of this Indenture or thereafter
incurred, unless it is provided in the instrument creating or evidencing the
same or pursuant to which the same is outstanding, that such obligations are
not superior in right of payment to the Securities issued under this Indenture;
provided, however, that if the Company
is subject to the regulation and supervision of any Applicable Insurance
Regulatory Authority, the Company shall have received the approval of each
appropriate Applicable Insurance Regulatory Authority prior to issuing any such
obligation if then required; and provided, further, that
Senior Debt shall not be deemed to include any other debt securities and
guarantees in respect of such debt securities issued to any trust other than
the Trust (or a trustee of any such trust), partnership or other entity
affiliated with the Company that is a financing vehicle of the Company (a “financing
entity”) in connection with the issuance by such financing entity of equity
securities or other securities that are treated as equity capital for
regulatory capital purposes guaranteed by the Company pursuant to an instrument
that ranks pari passu with or junior in right of
payment to this Indenture, including, without limitation, securities issued by
American Equity Capital Trust I, American Equity Capital Trust Il, American
Equity Capital Trust III and American Equity Capital Trust IV.

 

“Special Event” means the occurrence of an Investment Company Event or a Tax Event.

 

“Special Record Date” for the payment of any Defaulted Interest means a date
fixed by the Trustee pursuant to Section 3.1.

 

8

 

“Special Redemption Price” has the meaning set forth in Section 11.2.

 

“Stated Maturity” means April 29, 2034.

 

“Statutory Financial Statements” means all financial statements of the Company’s
subsidiary insurance companies for each relevant period, each prepared in
accordance with Applicable Accounting Principles.

 

“Subsidiary” means
a Person more than fifty percent (50%) of the outstanding voting stock or other
voting interests of which is owned, directly or indirectly, by the Company or
by one or more other Subsidiaries, or by the Company and one or more other
Subsidiaries. For purposes of this definition, “voting
stock” means stock that ordinarily has voting power for the election
of directors, whether at all times or only so long as no senior class of stock
has such voting power by reason of any contingency.

 

“Tax Event” means
the receipt by the Company of an Opinion of Counsel experienced in such matters
to the effect that, as a result of (a) any amendment to or change (including
any announced prospective change) in the laws or any regulations thereunder of
the United States or any political subdivision or taxing authority thereof or
therein or (b) any judicial decision or any official administrative
pronouncement (including any private letter ruling, technical advice memorandum
or field service advice) or regulatory procedure, including any notice or
announcement of intent to adopt any such pronouncement or procedure (an “Administrative Action”), regardless of whether such
judicial decision or Administrative Action is issued to or in connection with a
proceeding involving the Company or the Trust and whether or not subject to
review or appeal, which amendment, change, judicial decision or Administrative
Action is enacted, promulgated or announced, in each case, on or after the date
of issuance of the Securities, there is more than an insubstantial risk that
(i) the Trust is, or will be within ninety (90) days of the date of such
opinion, subject to United States federal income tax with respect to income
received or accrued on the Securities, (ii) interest payable by the Company on
the Securities is not, or within ninety (90) days of the date of such opinion,
will not be, deductible by the Company, in whole or in part, for United States
federal income tax purposes, or (iii) the Trust is, or will be within ninety
(90) days of the date of such opinion, subject to more than a de minimis amount of other taxes, duties or other
governmental charges.

 

“Trust” has
the meaning specified in the first recital of this Indenture.

 

“Trust Agreement” means the Amended and Restated Trust Agreement executed and delivered by
the Company, the Property Trustee, Chase Manhattan Bank USA, National
Association, as Delaware Trustee and the Administrative Trustees named therein,
contemporaneously with the execution and delivery of this Indenture, for the
benefit of the holders of the Trust Securities, as amended or supplemented from
time to time.

 

“Trustee” means
the Person named as the “Trustee” in
the first paragraph of this instrument, solely in its capacity as such and not
in its individual capacity, until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and, thereafter, “Trustee” shall mean or include each Person who is then a
Trustee hereunder.

 

“Trust Indenture Act” means the Trust Indenture Act of 1939, as amended and
as in effect on the date as of this Indenture.

 

9

 

“Trust Securities” has the meaning specified in the first recital of this Indenture.

 

SECTION 1.2.
Compliance Certificate and Opinions.

 

(a)                                  Upon any application or request by the Company to the
Trustee to take any action under any provision of this Indenture, the Company
shall, if requested by the Trustee, furnish to the Trustee an Officers’
Certificate stating that all conditions precedent (including covenants
compliance with which constitutes a condition precedent), if any, provided for
in this Indenture relating to the proposed action have been complied with and
an Opinion of Counsel stating that in the opinion of such counsel all such
conditions precedent (including covenants compliance with which constitutes a
condition precedent), if any, have been complied with.

 

(b)                                 Every certificate or opinion with respect to compliance
with a condition or covenant provided for in this Indenture (other than the
certificate provided pursuant to Section 10.3) shall include:

 

(i)
a statement by each individual signing such certificate or opinion that such
individual has read such covenant or condition and the definitions herein
relating thereto;

 

(ii)
a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions of such individual
contained in such certificate or opinion are based;

 

(iii)
a statement that, in the opinion of such individual, he or she has made such
examination or investigation as is necessary to enable him or her to express an
informed opinion as to whether or not such covenant or condition has been
complied with; and

 

(iv)
a statement as to whether, in the opinion of such individual, such condition or
covenant has been complied with.

 

SECTION 1.3. Forms of Documents Delivered to Trustee.

 

(a)                                  In any case where several matters are required to be
certified by, or covered by an opinion of, any specified Person, it is not
necessary that all such matters be certified by, or covered by the opinion of,
only one such Person, or that they be so certified or covered by only one
document, but one such Person may certify or give an opinion with respect to
some matters and one or more other such Persons as to other matters, and any
such Person may certify or give an opinion as to such matters in one or several
documents.

 

(b)                                 Any certificate or opinion of an officer of the Company
may be based, insofar as it relates to legal matters, upon a certificate or
opinion of, or representations by, counsel, unless such officer knows, or after
reasonable inquiry should know, that the certificate or opinion or
representations with respect to matters upon which his or her certificate or
opinion is based are erroneous. Any such certificate or Opinion of Counsel may
be based, insofar as it relates to factual matters, upon a certificate or
opinion of, or representations by, an officer or officers of the Company
stating that the information with respect to such factual matters is in the
possession of the Company, unless such counsel knows, or after reasonable
inquiry should know, that the certificate or opinion or representations with
respect to such matters are erroneous.

 

10

 

(c)                                  Where any Person is required to make, give or execute
two or more applications, requests, consents, certificates, statements,
opinions or other instruments under this Indenture, they may, but need not, be
consolidated and form one instrument.

 

(d)                                 Whenever, subsequent to the receipt by the Trustee of
any Board Resolution, Officers’ Certificate, Opinion of Counsel or other
document or instrument, a clerical, typographical or other inadvertent or
unintentional error or omission shall be discovered therein, a new document or
instrument may be substituted therefor in corrected form with the same force
and effect as if originally received in the corrected form and, irrespective of
the date or dates of the actual execution and/or delivery thereof, such
substitute document or instrument shall be deemed to have been executed and/or
delivered as of the date or dates required with respect to the document or
instrument for which it is substituted. Without limiting the generality of the
foregoing, any Securities issued under the authority of such defective document
or instrument shall nevertheless be the valid obligations of the Company
entitled to the benefits of this Indenture equally and ratably with all other
Outstanding Securities.

 

SECTION 1.4. Acts of
Holders.

 

(a)                                  Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Indenture to be given to or
taken by Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by an agent
thereof duly appointed in writing; and, except as herein otherwise expressly
provided, such action shall become effective when such instrument or
instruments (including any appointment of an agent) is or are delivered to the
Trustee, and, where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the “Act” of
the Holders signing such instrument or instruments. Proof of execution of any
such instrument or of a writing appointing any such agent shall be sufficient
for any purpose of this Indenture and conclusive in favor of the Trustee and
the Company, if made in the manner provided in this Section 1.4.

 

(b)                                 The fact and date of the execution by any Person of any
such instrument or writing may be proved by the affidavit of a witness of such
execution or by the certificate of any notary public or other officer
authorized by law to take acknowledgments of deeds, certifying that the
individual signing such instrument or writing acknowledged to him or her the
execution thereof. Where such execution is by a Person acting in other than his
or her individual capacity, such certificate or affidavit shall also constitute
sufficient proof of his or her authority. The fact and date of the execution by
any Person of any such instrument or writing, or the authority of the Person
executing the same, may also be proved in any other manner that the Trustee
deems sufficient and in accordance with such reasonable rules as the Trustee
may determine.

 

(c)                                  The ownership of Securities shall be proved by the
Securities Register.

 

(d)                                 Any request, demand, authorization, direction, notice,
consent, waiver or other action by the Holder of any Security shall bind every
future Holder of the same Security and the Holder of every Security issued upon
the registration of transfer thereof or in exchange therefor or in lieu thereof
in respect of anything done or suffered to be done by the Trustee or the
Company in reliance thereon, whether or not notation of such action is made
upon such Security.

 

11

 

(e)                                  Without limiting the foregoing, a Holder entitled to
take any action hereunder with regard to any particular Security may do so with
regard to all or any part of the principal amount of such Security or by one or
more duly appointed agents each of which may do so pursuant to such appointment
with regard to all or any part of such principal amount.

 

(f)                                    Except as set forth in paragraph (g) of this Section 1.4,
the Company may set any day as a record date for the purpose of determining the
Holders of Outstanding Securities entitled to give, make or take any request,
demand, authorization, direction, notice, consent, waiver or other action provided
or permitted by this Indenture to be given, made or taken by Holders of
Securities. If any record date is set pursuant to this paragraph, the Holders
of Outstanding Securities on such record date, and no other Holders, shall be
entitled to take the relevant action, whether or not such Holders remain
Holders after such record date; provided, that
no such action shall be effective hereunder unless taken on or prior to the
applicable Expiration Date (as defined in Section 1.4(h)) by
Holders of the requisite principal amount of Outstanding Securities on such
record date. Nothing in this paragraph shall be construed to prevent the
Company from setting a new record date for any action for which a record date
has previously been set pursuant to this paragraph (whereupon the record date
previously set shall automatically and with no action by any Person be canceled
and of no effect). Promptly after any record date is set pursuant to this
paragraph, the Company, at its own expense, shall cause notice of such record
date, the proposed action by Holders and the applicable Expiration Date to be
given to the Trustee in writing and to each Holder of Securities in the manner
set forth in Section 1.6.

 

(g)                                 The Trustee may set any day as a record date for the
purpose of determining the Holders of Outstanding Securities entitled to join
in the giving or making of (i) any Notice of Default, (ii) any declaration of
acceleration or rescission or annulment thereof referred to in Section 5.2,
(iii) any request to institute proceedings referred to in Section 5.7(b)
or (iv) any direction referred to in Section 5.12. If any record
date is set pursuant to this paragraph, the Holders of Outstanding Securities
on such record date, and no other Holders, shall be entitled to join in such
notice, declaration, request or direction, whether or not such Holders remain
Holders after such record date; provided, that
no such action shall be effective hereunder unless taken on or prior to the
applicable Expiration Date by Holders of the requisite principal amount of
Outstanding Securities on such record date. Nothing in this paragraph shall be
construed to prevent the Trustee from setting a new record date for any action
for which a record date has previously been set pursuant to this paragraph (whereupon
the record date previously set shall automatically and with no action by any
Person be canceled and of no effect). Promptly after any record date is set
pursuant to this paragraph, the Trustee, at the Company’s expense, shall cause
notice of such record date, the proposed action by Holders and the applicable
Expiration Date to be given to the Company in writing and to each Holder of
Securities in the manner set forth in Section 1.6.

 

(h)                                 With respect to any record date set pursuant to
paragraph (f) or (g) of this Section 1.4, the party hereto that
sets such record date may designate any day as the “Expiration
Date” and from time to time may change the Expiration Date to any
earlier or later day; provided, that
no such change shall be effective unless notice of the proposed new Expiration
Date is given to the other party hereto in writing, and to each Holder of
Securities in the manner set forth in Section 1.6, on or prior to
the existing Expiration Date. If an Expiration Date is not designated with respect
to any record date set pursuant to this Section 1.4, the party
hereto that set such record date shall be deemed to have initially designated
the ninetieth (90th) day after such record

 

12

 

date as
the Expiration Date with respect thereto, subject to its right to change the
Expiration Date as provided in this paragraph. Notwithstanding the foregoing,
no Expiration Date shall be later than the one hundred eightieth (180th)
day after the applicable record date.

 

SECTION 1.5. Notices, Etc. to Trustee and Company.

 

Any
request, demand, authorization, direction, notice, consent, waiver, Act of
Holders, or other document provided or permitted by this Indenture to be made
upon, given or furnished to, or filed with:

 

(a)                                  the Trustee by any Holder, any holder of Preferred
Securities or the Company shall be sufficient for every purpose hereunder if
made, given, furnished or filed in writing to or with and received by the
Trustee at its Corporate Trust Office, or

 

(b)                                 the Company by the Trustee, any Holder or any holder of
Preferred Securities shall be sufficient for every purpose hereunder if in
writing and mailed, first class, postage prepaid, to the Company addressed to
it at American Equity Investment Life Holding Company, 5000 Westown Parkway,
Suite 440, West Des Moines, IA 50266, Attention: Wendy Carlson, Chief Financial
Officer or at any other address previously furnished in writing to the Trustee
by the Company.

 

SECTION 1.6.
Notice to Holders; Waiver.

 

Where this
Indenture provides for notice to Holders of any event, such notice shall be
sufficiently given (unless otherwise herein expressly provided) if in writing
and mailed, first class, postage prepaid, to each Holder affected by such event
to the address of such Holder as it appears in the Securities Register, not
later than the latest date, and not earlier than the earliest date, prescribed
for the giving of such notice. If, by reason of the suspension of or
irregularities in regular mail service or for any other reason, it shall be
impossible or impracticable to mail notice of any event to Holders when said
notice is required to be given pursuant to any provision of this Indenture,
then any manner of giving such notice as shall be satisfactory to the Trustee
shall be deemed to be a sufficient giving of such notice. In any case where
notice to Holders is given by mail, neither the failure to mail such notice,
nor any defect in any notice so mailed, to any particular Holder shall affect
the sufficiency of such notice with respect to other Holders. Where this
Indenture provides for notice in any manner, such notice may be waived in
writing by the Person entitled to receive such notice, either before or after
the event, and such waiver shall be the equivalent of such notice. Waivers of
notice by Holders shall be filed with the Trustee, but such filing shall not be
a condition precedent to the validity of any action taken in reliance upon such
waiver.

 

SECTION 1.7.
Effect of Headings and Table of Contents.

 

The Article and
Section headings herein and the Table of Contents are for convenience only
and shall not affect the construction of this Indenture.

 

SECTION 1.8.
Successors and Assigns.

 

This
Indenture shall be binding upon and shall inure to the benefit of any successor
to the Company and the Trustee, including any successor by operation of law.
Except in connection

 

13

 

with a
transaction involving the Company that is permitted under Article VIII
and pursuant to which the assignee agrees in writing to perform the Company’s
obligations hereunder, the Company shall not assign its obligations hereunder.

 

SECTION 1.9.
Separability Clause.

 

If any
provision in this Indenture or in the Securities shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby, and there
shall be deemed substituted for the provision at issue a valid, legal and
enforceable provision as similar as possible to the provision at issue.

 

SECTION 1.10.
Benefits of Indenture.

 

Nothing
in this Indenture or in the Securities, express or implied, shall give to any
Person, other than the parties hereto and their successors and assigns, the
holders of Senior Debt, the Holders of the Securities and, to the extent
expressly provided in Sections 5.2, 5.8, 5.9, 5.11,
5.13, 9.2 and 10.7, the holders of Preferred Securities,
any benefit or any legal or equitable right, remedy or claim under this
Indenture.

 

SECTION 1.11. Governing Law.

 

This Indenture and the rights and obligations of each of the
Holders, the Company and the Trustee shall be construed and enforced in
accordance with and governed by the laws of the State of New York without
reference to its conflict of laws provisions (other than Section 5-1401 of
the General Obligations Law).

 

SECTION 1.12.
Submission to Jurisdiction.

 

ANY LEGAL
ACTION OR PROCEEDING BY OR AGAINST ANY PARTY HERETO OR WITH RESPECT TO OR
ARISING OUT OF THIS INDENTURE MAY BE BROUGHT IN OR REMOVED TO THE COURTS OF THE
STATE OF NEW YORK, IN AND FOR THE COUNTY OF NEW YORK, OR OF THE UNITED STATES
OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK (IN EACH CASE SITTING IN THE
BOROUGH OF MANHATTAN). BY EXECUTION AND DELIVERY OF THIS INDENTURE, EACH PARTY
ACCEPTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND
UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS (AND COURTS OF
APPEALS THEREFROM) FOR LEGAL PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH
THIS INDENTURE.

 

SECTION 1.13. Non-Business Days.

 

If any
Interest Payment Date, Redemption Date or Stated Maturity of any Security shall
not be a Business Day, then (notwithstanding any other provision of this
Indenture or the Securities) payment of interest, premium, if any, or principal
or other amounts in respect of such Security shall not be made on such date,
but shall be made on the next succeeding Business Day (and no interest shall
accrue in respect of the amounts whose payment is so delayed for the period
from and after such Interest Payment Date, Redemption Date or Stated Maturity,
as the case may be, until such next succeeding Business Day) except that, if
such Business Day falls in the next succeeding calendar year, such payment
shall be made on the immediately preceding

 

14

 

Business
Day, in each case with the same force and effect as if made on the Interest
Payment Date or Redemption Date or at the Stated Maturity.

 

ARTICLE II

 

SECURITY FORMS

 

SECTION 2.1. Form of
Security.

 

Any
Security issued hereunder shall be in substantially the following form:

 

AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY

 

Floating Rate Junior Subordinated Note due 2034

 

	
  No.

  	
  $27,840,000

  

 

American
Equity Investment Life Holding Company, a corporation organized and existing
under the laws of Iowa (hereinafter called the “Company,” which
term includes any successor Person under the Indenture hereinafter referred
to), for value received, hereby promises to pay to              ,
or registered assigns, the principal sum of Twenty-Seven Million Eight Hundred
Forty Thousand Dollars ($27,840,000) or such other principal amount represented
hereby as may be set forth in the records of the Securities Registrar
hereinafter referred to in accordance with the Indenture on April 29,
2034. The Company further promises to pay interest on said principal sum from April 29,
2004, or from the most recent Interest Payment Date to which interest has been
paid or duly provided for, quarterly (subject to deferral as set forth herein)
in arrears on February 15, May 15, August 15, and November 15 of
each year, commencing August 15, 2004, or if any such day is not a
Business Day, on the next succeeding Business Day (and no interest shall accrue
in respect of the amounts whose payment is so delayed for the period from and
after such Interest Payment Date until such next succeeding Business Day),
except that, if such Business Day falls in the next succeeding calendar year,
such payment shall be made on the immediately preceding Business Day, in each
case, with the same force and effect as if made on the Interest Payment Date,
at a variable rate equal to LIBOR plus 3.90% per annum, together with
Additional Tax Sums, if any, as provided in Section 10.5 of the
Indenture, until the principal hereof is paid or duly provided for or made
available for payment; provided, further, that
any overdue principal, premium, if any, or Additional Tax Sums and any overdue
installment of interest shall bear Additional Interest at a variable rate equal
to LIBOR plus 3.90% per annum (to the extent that the payment of such interest
shall be legally enforceable), compounded quarterly, from the dates such
amounts are due until they are paid or made available for payment, and such
interest shall be payable on demand.

 

The
amount of interest payable shall be computed on the basis of a 360-day year and
the actual number of days elapsed in the relevant interest period. The interest
so payable, and punctually paid or duly provided for, on any Interest Payment
Date shall, as provided in the Indenture, be paid to the Person in whose name
this Security (or one or more Predecessor Securities) is registered at the
close of business on the Regular Record Date for such interest installment. Any
such interest not so punctually paid or duly provided for shall forthwith cease
to be payable to the Holder on such Regular Record Date and may either be paid
to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of

 

15

 

business
on a Special Record Date for the payment of such Defaulted Interest to be fixed
by the Trustee, notice whereof shall be given to Holders of Securities not less
than ten (10) days prior to such Special Record Date, or be paid at any time in
any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities may be listed, and upon such notice
as may be required by such exchange, all as more fully provided in the Indenture.

 

So long
as no Event of Default has occurred and is continuing, the Company shall have
the right, at any time and from time to time during the term of this Security,
to defer the payment of interest on this Security for a period of up to twenty (20)
consecutive quarterly interest payment periods (each such period, an “Extension Period”), during which Extension Period(s), no
interest shall be due and payable (except any Additional Tax Sums that may be
due and payable). No Extension Period shall end on a date other than an
Interest Payment Date, and no Extension Period shall extend beyond the Stated
Maturity of the principal of this Security. No interest shall be due and
payable during an Extension Period (except any Additional Tax Sums that may be due
and payable), except at the end thereof, but each installment of interest that
would otherwise have been due and payable during such Extension Period shall
bear Additional Interest (to the extent payment of such interest would be
legally enforceable) at a variable rate equal to LIBOR plus 3.90% per annum,
compounded quarterly, from the dates on which amounts would have otherwise been
due and payable until paid or made available for payment. At the end of any
such Extension Period, the Company shall pay all interest then accrued and
unpaid on this Security, together with such Additional Interest. Prior to the
termination of any such Extension Period, the Company may further defer the
payment of interest; provided, that
(i) all such previous and further extensions comprising such Extension Period
do not exceed twenty (20) quarterly interest payment periods, (ii) no Extension
Period shall end on a date other than an Interest Payment Date and (iii) no
Extension Period shall extend beyond the Stated Maturity of the principal of
this Security. Upon the termination of any such Extension Period and upon the
payment of all accrued and unpaid interest and any Additional Interest then due
on any Interest Payment Date, the Company may elect to begin a new Extension Period;
provided, that (i) such Extension Period
does not exceed twenty (20) quarterly interest payment periods, (ii) no
Extension Period shall end on a date other than an Interest Payment Date and
(iii) no Extension Period shall extend beyond the Stated Maturity of the
principal of this Security. The Company shall give the Holder of this Security
and the Trustee written notice of its election to begin any such Extension
Period at least one Business Day prior to the next succeeding Interest Payment
Date on which interest on this Security would be payable but for such deferral
or, so long as this Security is held by the Trust, at least one Business Day
prior to the earlier of (i) the next succeeding date on which Distributions on
the Preferred Securities of American Equity Capital Trust III would be payable
but for such deferral and (ii) the date on which the Property Trustee of such
Trust is required to give notice to any securities exchange or other applicable
self-regulatory organization or to holders of such Preferred Securities of the
record date for the payment of such Distributions.

 

During
any such Extension Period, the Company shall not (i) declare or pay any
dividends or distributions on, or redeem, purchase, acquire or make a
liquidation payment with respect to, any of the Company’s capital stock or (ii)
make any payment of principal of or any interest or premium, if any, on or
repay, repurchase or redeem any debt securities of the Company that rank pari passu in all respects with or junior in interest to
this Security (other than (a) repurchases, redemptions or other acquisitions of
shares of capital stock of the Company in connection with (1) any employment
contract, benefit plan or other similar arrangement with or

 

16

 

for the
benefit of any one or more employees, officers, directors or consultants, (2) a
dividend reinvestment or stockholder stock purchase plan and (3) the issuance
of capital stock of the Company (or securities convertible into or exercisable
for such capital stock) as consideration in an acquisition transaction entered
into prior to the applicable Extension Period, (b) as a result of an exchange
or conversion of any class or series of the Company’s capital stock (or any
capital stock of a Subsidiary of the Company) for any class or series of the
Company’s capital stock or of any class or series of the Company’s indebtedness
for any class or series of the Company’s capital stock, (c) the purchase of
fractional interests in shares of the Company’s capital stock pursuant to the
conversion or exchange provisions of such capital stock or the security being
converted or exchanged, (d) any declaration of a dividend in connection with
any Rights Plan, the issuance of rights, stock or other property under any
Rights Plan, or the redemption or repurchase of rights pursuant thereto or (e)
any dividend in the form of stock, warrants, options or other rights where the
dividend stock or the stock issuable upon exercise of such warrants, options or
other rights is the same stock as that on which the dividend is being paid or
ranks pari passu with or junior to such
stock).

 

Payment
of principal of, premium, if any, and interest on this Security shall be made
in such coin or currency of the United States of America as at the time of
payment is legal tender for payment of public and private debts. Payments of
principal, premium, if any, and interest due at the Maturity of this Security
shall be made at the Place of Payment upon surrender of such Securities to the
Paying Agent, and payments of interest shall be made, subject to such surrender
where applicable, by wire transfer at such place and to such account at a
banking institution in the United States as may be designated in writing to the
Paying Agent at least ten (10) Business Days prior to the date for payment by
the Person entitled thereto unless proper written transfer instructions have
not been received by the relevant record date, in which case such payments
shall be made by check mailed to the address of such Person as such address
shall appear in the Security Register. Notwithstanding the foregoing, so long
as the Holder of this Security is the Property Trustee, the payment of the
principal of (and premium, if any) and interest (including any overdue installment
of interest and Additional Tax Sums, if any) on this Security will be made at
such place and to such account as may be designated by the Property Trustee.

 

The
indebtedness evidenced by this Security is, to the extent provided in the
Indenture, subordinate and junior in right of payment to the prior payment in
full of all Senior Debt, and this Security is issued subject to the provisions
of the Indenture with respect thereto. Each Holder of this Security, by
accepting the same, (a) agrees to and shall be bound by such provisions, (b)
authorizes and directs the Trustee on his or her behalf to take such actions as
may be necessary or appropriate to effectuate the subordination so provided and
(c) appoints the Trustee his or her attorney-in-fact for any and all such
purposes. Each Holder hereof, by his or her acceptance hereof, waives all
notice of the acceptance of the subordination provisions contained herein and
in the Indenture by each holder of Senior Debt, whether now outstanding or
hereafter incurred, and waives reliance by each such holder upon said
provisions.

 

Unless
the certificate of authentication hereon has been executed by the Trustee by
manual signature, this Security shall not be entitled to any benefit under the
Indenture or be valid or obligatory for any purpose.

 

[FORM OF REVERSE OF SECURITY]

 

17

 

This
Security is one of a duly authorized issue of securities of the Company (the “Securities”) issued under the Junior Subordinated Indenture,
dated as of April 29, 2004 (the “Indenture”), between
the Company and JPMorgan Chase Bank, as Trustee (in such capacity, the “Trustee,” which term includes any successor trustee under
the Indenture), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights, limitations
of rights, duties and immunities thereunder of the Company, the Trustee, the
holders of Senior Debt, the Holders of the Securities and the holders of the
Preferred Securities, and of the terms upon which the Securities are, and are
to be, authenticated and delivered.

 

All terms
used in this Security that are defined in the Indenture or in the Amended and
Restated Trust Agreement, dated as of April 29, 2004 (as modified, amended
or supplemented from time to time, the “Trust Agreement”), relating
to the American Equity Capital Trust III (the “Trust”) among
the Company, as Depositor, the Trustees named therein and the Holders from time
to time of the Trust Securities issued pursuant thereto, shall have the
meanings assigned to them in the Indenture or the Trust Agreement, as the case
may be.

 

The
Company may, on any Interest Payment Date, at its option, upon not less than
thirty (30) days’ nor more than sixty (60) days’ written notice to the Holders
of the Securities (unless a shorter notice period shall be satisfactory to the
Trustee) on or after April 29, 2009 and subject to the terms and
conditions of Article XI of the Indenture, redeem this Security in
whole at any time or in part from time to time at a Redemption Price equal to
one hundred percent (100%) of the principal amount hereof, together, in the
case of any such redemption, with accrued interest, including any Additional
Interest, through but excluding the date fixed as the Redemption Date; provided, that the Company shall have received the prior
approval of any Applicable Insurance Regulatory Authority then required.

 

In
addition, upon the occurrence and during the continuation of a Special Event,
the Company may, at its option, upon not less than thirty (30) days’ nor more
than sixty (60) days’ written notice to the Holders of the Securities (unless a
shorter notice period shall be satisfactory to the Trustee), redeem this
Security, in whole but not in part, subject to the terms and conditions of Article XI
of the Indenture at a Redemption Price equal to one hundred seven and one half
percent (107.5%) of the principal amount hereof, together, in the case of any
such redemption, with accrued interest, including any Additional Interest,
through but excluding the date fixed as the Redemption Date; provided, that the Company shall have received the prior
approval of any Applicable Insurance Regulatory Authority then required.

 

In the
event of redemption of this Security in part only, a new Security or Securities
for the unredeemed portion hereof will be issued in the name of the Holder
hereof upon the cancellation hereof. If less than all the Securities are to be
redeemed, the particular Securities to be redeemed shall be selected not more
than sixty (60) days prior to the Redemption Date by the Trustee from the
Outstanding Securities not previously called for redemption, by such method as
the Trustee shall deem fair and appropriate and which may provide for the
selection for redemption of a portion of the principal amount of any Security.

 

The
Indenture permits, with certain exceptions as therein provided, the Company and
the Trustee at any time to enter into a supplemental indenture or indentures
for the purpose of modifying in any manner the rights and obligations of the
Company and of the Holders of the

 

18

 

Securities,
with the consent of the Holders of not less than a majority in principal amount
of the Outstanding Securities. The Indenture also contains provisions
permitting Holders of specified percentages in principal amount of the
Securities, on behalf of the Holders of all Securities, to waive compliance by
the Company with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the
Holder of this Security shall be conclusive and binding upon such Holder and
upon all future Holders of this Security and of any Security issued upon the
registration of transfer hereof or in exchange herefor or in lieu hereof,
whether or not notation of such consent or waiver is made upon this Security.

 

No
reference herein to the Indenture and no provision of this Security or of the
Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and any premium, if any,
and interest, including any Additional Interest, on this Security at the times,
place and rate, and in the coin or currency, herein prescribed.

 

As
provided in the Indenture and subject to certain limitations therein set forth,
the transfer of this Security is registrable in the Securities Register, upon
surrender of this Security for registration of transfer at the office or agency
of the Company maintained for such purpose, duly endorsed by, or accompanied by
a written instrument of transfer in form satisfactory to the Company and the
Securities Registrar and duly executed by, the Holder hereof or such Holder’s
attorney duly authorized in writing, and thereupon one or more new Securities,
of like tenor, of authorized denominations and for the same aggregate principal
amount, will be issued to the designated transferee or transferees.

 

The
Securities are issuable only in registered form without coupons in minimum
denominations of $100,000 and any integral multiple of $1,000 in excess
thereof. As provided in the Indenture and subject to certain limitations
therein set forth, Securities are exchangeable for a like aggregate principal
amount of Securities and of like tenor of a different authorized denomination,
as requested by the Holder surrendering the same.

 

No
service charge shall be made for any such registration of transfer or exchange,
but the Company may require payment of a sum sufficient to cover any tax or
other governmental charge payable in connection therewith.

 

The
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name this Security is registered as the owner hereof for all
purposes, whether or not this Security be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.

 

The
Company and, by its acceptance of this Security or a beneficial interest
therein, the Holder of, and any Person that acquires a beneficial interest in,
this Security agree that, for United States federal, state and local tax
purposes, it is intended that this Security constitute indebtedness.

 

This Security shall be construed and enforced in accordance
with and governed by the laws of the State of New York, without reference to
its conflict of laws provisions (other than Section 5-1401 of the General
Obligations Law).

 

19

 

IN
WITNESS WHEREOF, the Company has caused this instrument to be duly executed on
this        day of                  ,
20    .

 

	
   

  	
  AMERICAN EQUITY
  INVESTMENT LIFE HOLDING

  COMPANY

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

SECTION 2.2.
Restricted Legend.

 

(a)                                  Any Security issued hereunder shall bear a legend in substantially
the following form:

 

“THIS
SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER
REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITORY TRUST COMPANY (“DTC”)
OR A NOMINEE OF DTC. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED IN
THE NAME OF A PERSON OTHER THAN DTC OR ITS NOMINEE ONLY IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS SECURITY
(OTHER THAN A TRANSFER OF THIS SECURITY AS A WHOLE BY DTC TO A NOMINEE OF DTC
OR BY A NOMINEE OF DTC TO DTC OR ANOTHER NOMINEE OF DTC) MAY BE REGISTERED
EXCEPT IN LIMITED CIRCUMSTANCES.

 

UNLESS
THIS SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF DTC TO THE ISSUER
OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
SECURITY ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

THE
SECURITIES REPRESENTED BY THIS CERTIFICATE WERE ORIGINALLY ISSUED IN A TRANSACTION
EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), AND SUCH SECURITIES, AND ANY INTEREST THEREIN, MAY NOT BE OFFERED, SOLD
OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
THEREFROM. EACH PURCHASER OF ANY SECURITIES IS HEREBY NOTIFIED THAT THE SELLER
OF THE SECURITIES MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5
OF THE SECURITIES ACT PROVIDED BY RULE 144A UNDER THE SECURITIES ACT.

 

20

 

THE
HOLDER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE AGREES FOR THE BENEFIT
OF THE COMPANY THAT (A) SUCH SECURITIES MAY BE OFFERED, RESOLD OR OTHERWISE
TRANSFERRED ONLY (I) TO THE COMPANY, (II) TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF
RULE 144A, (III) TO AN INSTITUTIONAL “ACCREDITED INVESTOR” WITHIN THE MEANING
OF SUBPARAGRAPH (a) (1), (2),(3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT
THAT IS ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF AN “ACCREDITED
INVESTOR,” FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE
IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, (IV)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR (V)
PURSUANT TO AN EXEMPTION FROM THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE
WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY
OTHER APPLICABLE JURISDICTION AND, IN THE CASE OF (III) OR (V), SUBJECT TO THE
RIGHT OF THE COMPANY TO REQUIRE AN OPINION OF COUNSEL AND OTHER INFORMATION
SATISFACTORY TO IT AND (B) THE HOLDER WILL NOTIFY ANY PURCHASER OF ANY
SECURITIES FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE.

 

THE
SECURITIES WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN BLOCKS HAVING AN
AGGREGATE PRINCIPAL AMOUNT OF NOT LESS THAN $100,000. TO THE FULLEST EXTENT
PERMITTED BY LAW, ANY ATTEMPTED TRANSFER OF SECURITIES, OR ANY INTEREST
THEREIN, IN A BLOCK HAVING AN AGGREGATE PRINCIPAL AMOUNT OF LESS THAN $100,000
AND MULTIPLES OF $1,000 IN EXCESS THEREOF SHALL BE DEEMED TO BE VOID AND OF NO
LEGAL EFFECT WHATSOEVER. TO THE FULLEST EXTENT PERMITTED BY LAW, ANY SUCH
PURPORTED TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER OF SUCH SECURITIES
FOR ANY PURPOSE, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF PRINCIPAL OF OR
INTEREST ON SUCH SECURITIES, OR ANY INTEREST THEREIN, AND SUCH PURPORTED TRANSFEREE
SHALL BE DEEMED TO HAVE NO INTEREST WHATSOEVER IN SUCH SECURITIES.

 

THE
HOLDER OF THIS SECURITY, OR ANY INTEREST THEREIN, BY ITS ACCEPTANCE HEREOF OR
THEREOF ALSO AGREES, REPRESENTS AND WARRANTS THAT IT IS NOT AN EMPLOYEE
BENEFIT, INDIVIDUAL RETIREMENT ACCOUNT OR OTHER PLAN OR ARRANGEMENT SUBJECT TO
TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”), OR SECTION 4975 OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED (THE “CODE”) (EACH A
“PLAN”), OR AN ENTITY WHOSE UNDERLYING
ASSETS INCLUDE “PLAN ASSETS” BY REASON OF ANY PLAN’S INVESTMENT IN THE ENTITY,
AND NO PERSON INVESTING “PLAN ASSETS” OF ANY PLAN MAY ACQUIRE OR HOLD THIS
SECURITY OR ANY INTEREST THEREIN. ANY PURCHASER OR HOLDER OF

 

21

 

THE
SECURITIES OR ANY INTEREST THEREIN WILL BE DEEMED TO HAVE REPRESENTED BY ITS
PURCHASE AND HOLDING THEREOF THAT IT IS NOT AN EMPLOYEE BENEFIT PLAN WITHIN THE
MEANING OF SECTION 3(3) OF ERISA, OR A PLAN TO WHICH SECTION 4975 OF
THE CODE IS APPLICABLE, A TRUSTEE OR OTHER PERSON ACTING ON BEHALF OF AN
EMPLOYEE BENEFIT PLAN OR PLAN, OR ANY OTHER PERSON OR ENTITY USING THE ASSETS
OF ANY EMPLOYEE BENEFIT PLAN OR PLAN TO FINANCE SUCH PURCHASE.”

 

(b)                                 The above legends shall not be removed from any
Security unless there is delivered to the Company satisfactory evidence, which
may include an Opinion of Counsel, as may be reasonably required to ensure that
any future transfers thereof may be made without restriction under or violation
of the provisions of the Securities Act and other applicable law. Upon
provision of such satisfactory evidence, the Company shall execute and deliver
to the Trustee, and the Trustee shall deliver, upon receipt of a Company Order
directing it to do so, a Security that does not bear the legend.

 

SECTION 2.3.
Form of Trustee’s Certificate of Authentication.

 

The
Trustee’s certificate of authentication shall be in substantially the following
form:

 

This is
one of the Securities referred to in the within-mentioned Indenture.

 

	
  Dated:

  
	
   

  
	
   

  	
  JPMORGAN
  CHASE BANK, as Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Authorized signatory

  

 

SECTION 2.4.
Temporary Securities.

 

(a)                                  Pending the preparation of definitive Securities, the
Company may execute, and upon Company Order the Trustee shall authenticate and
deliver, temporary Securities that are printed, lithographed, typewritten,
mimeographed or otherwise produced, in any denomination, substantially of the
tenor of the definitive Securities in lieu of which they are issued and with
such appropriate insertions, omissions, substitutions and other variations as
the officers executing such Securities may determine, as evidenced by their
execution of such Securities.

 

(b)                                 If temporary Securities are issued, the Company will
cause definitive Securities to be prepared without unreasonable delay. After
the preparation of definitive Securities, the temporary Securities shall be
exchangeable for definitive Securities upon surrender of the temporary
Securities at the office or agency of the Company designated for that purpose
without charge to the Holder. Upon surrender for cancellation of any one or
more temporary Securities, the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor one or more definitive Securities
of any authorized denominations having the same Original Issue Date and Stated
Maturity and having the same terms as such temporary Securities. Until so

 

22

 

exchanged,
the temporary Securities shall in all respects be entitled to the same benefits
under this Indenture as definitive Securities.

 

SECTION 2.5.
Definitive Securities.

 

The
Securities issued on the Original Issue Date shall be in definitive form. The
definitive Securities shall be printed, lithographed or engraved, or produced
by any combination of these methods, if required by any securities exchange on
which the Securities may be listed, on a steel engraved border or steel
engraved borders or may be produced in any other manner permitted by the rules
of any securities exchange on which the Securities may be listed, all as
determined by the officers executing such Securities, as evidenced by their
execution of such Securities.

 

ARTICLE III

 

THE SECURITIES

 

SECTION 3.1. Payment of Principal and Interest.

 

(a)                                  The unpaid principal amount of the Securities shall
bear interest at a variable rate of LIBOR plus 3.90% per annum until paid or
duly provided for, such interest to accrue from the Original Issue Date or from
the most recent Interest Payment Date to which interest has been paid or duly
provided for, and any overdue principal, premium, if any, or Additional Tax
Sums and any overdue installment of interest shall bear Additional Interest at
the rate equal to a variable rate of LIBOR plus 3.90% per annum, compounded quarterly
from the dates such amounts are due until they are paid or funds for the
payment thereof are made available for payment.

 

(b)                                 Interest and Additional Interest on any Security that
is payable, and is punctually paid or duly provided for, on any Interest
Payment Date shall be paid to the Person in whose name that Security (or one or
more Predecessor Securities) is registered at the close of business on the
Regular Record Date for such interest, except that interest and any Additional
Interest payable on the Stated Maturity (or any date of principal repayment
upon early maturity) of the principal of a Security or on a Redemption Date
shall be paid to the Person to whom principal is paid. The initial payment of
interest on any Security that is issued between a Regular Record Date and the
related Interest Payment Date shall be payable as provided in such Security.

 

(c)                                  Any interest on any Security that is due and payable,
but is not timely paid or duly provided for, on any Interest Payment Date for
Securities (herein called “Defaulted Interest”) shall
forthwith cease to be payable to the registered Holder on the relevant Regular
Record Date by virtue of having been such Holder, and such Defaulted Interest
may be paid by the Company, at its election in each case, as provided in
paragraph (i) or (ii) below:

 

(i)
The Company may elect to make payment of any Defaulted Interest to the Persons
in whose names the Securities (or their respective Predecessor Securities) are
registered at the close of business on a Special Record Date for the payment of
such Defaulted Interest (a “Special Record Date”),
which shall be fixed in the following manner. At least thirty (30)
days prior to the date of the proposed payment, the Company shall notify the
Trustee in writing of the amount of Defaulted Interest proposed to be paid

 

23

 

on each
Security and the date of the proposed payment, and at the same time the Company
shall deposit with the Trustee an amount of money equal to the aggregate amount
proposed to be paid in respect of such Defaulted Interest or shall make
arrangements satisfactory to the Trustee for such deposit prior to the date of
the proposed payment, such money when deposited to be held in trust for the
benefit of the Persons entitled to such Defaulted Interest. Thereupon the
Trustee shall fix a Special Record Date for the payment of such Defaulted
Interest, which shall be not more than fifteen (15) days and not less than ten
(10) days prior to the date of the proposed payment and not less than ten (10)
days after the receipt by the Trustee of the notice of the proposed payment.
The Trustee shall promptly notify the Company of such Special Record Date and,
in the name and at the expense of the Company, shall cause notice of the
proposed payment of such Defaulted Interest and the Special Record Date
therefor to be mailed, first class, postage prepaid, to each Holder of a
Security at the address of such Holder as it appears in the Securities Register
not less than ten (10) days prior to such Special Record Date. Notice of the
proposed payment of such Defaulted Interest and the Special Record Date
therefor having been so mailed, such Defaulted Interest shall be paid to the
Persons in whose names the Securities (or their respective Predecessor
Securities) are registered on such Special Record Date; or

 

(ii)
The Company may make payment of any Defaulted Interest in any other lawful
manner not inconsistent with the requirements of any securities exchange on
which the Securities may be listed and, upon such notice as may be required by
such exchange (or by the Trustee if the Securities are not listed), if, after
notice given by the Company to the Trustee of the proposed payment pursuant to
this clause, such payment shall be deemed practicable by the Trustee.

 

(d)                                 Payments of interest on the Securities shall include
interest accrued to but excluding the respective Interest Payment Dates.
Interest payments for the Securities shall be computed and paid on the basis of
a 360-day year and the actual number of days elapsed in the relevant interest
period.

 

(e)                                  Payment of principal of, premium, if any, and interest
on the Securities shall be made in such coin or currency of the United States
of America as at the time of payment is legal tender for payment of public and
private debts. Payments of principal, premium, if any, and interest due at the
Maturity of such Securities shall be made at the Place of Payment upon
surrender of such Securities to the Paying Agent and payments of interest shall
be made subject to such surrender where applicable, by wire transfer at such
place and to such account at a banking institution in the United States as may
be designated in writing to the Paying Agent at least ten (10) Business Days
prior to the date for payment by the Person entitled thereto unless proper
written transfer instructions have not been received by the relevant record
date, in which case such payments shall be made by check mailed to the address
of such Person as such address shall appear in the Security Register.
Notwithstanding the foregoing, so long as the holder of this Security is the
Property Trustee, the payment of the principal of (and premium, if any) and
interest (including any overdue installment of interest and Additional Tax
Sums, if any) on this Security will be made at such place and to such account
as may be designated by the Property Trustee.

 

24

 

(f)                                    Subject to the foregoing provisions of this Section 3.1,
each Security delivered under this Indenture upon transfer of or in exchange
for or in lieu of any other Security shall carry the rights to interest accrued
and unpaid, and to accrue, that were carried by such other Security.

 

SECTION 3.2. Denominations.

 

The
Securities shall be in registered form without coupons and shall be issuable in
minimum denominations of $100,000 and any integral multiple of $1,000 in excess
thereof.

 

SECTION 3.3.  Execution, Authentication,
Delivery and Dating.

 

(a)                                  At any time and from time to time after the execution
and delivery of this Indenture, the Company may deliver Securities in an
aggregate principal amount (including all then Outstanding Securities) not in
excess of Twenty-Seven Million Eight Hundred Forty Thousand Dollars
($27,840,000) executed by the Company to the Trustee for authentication,
together with a Company Order for the authentication and delivery of such
Securities, and the Trustee in accordance with the Company Order shall
authenticate and deliver such Securities. In authenticating such Securities,
and accepting the additional responsibilities under this Indenture in relation
to such Securities, the Trustee shall be entitled to receive, and shall be
fully protected in relying upon:

 

(i)
a copy of any Board Resolution relating thereto; and

 

(ii)
an Opinion of Counsel stating that: (1) such Securities, when authenticated and
delivered by the Trustee and issued by the Company in the manner and subject to
any conditions specified in such Opinion of Counsel, will constitute, and the Indenture
constitutes, valid and legally binding obligations of the Company, each
enforceable in accordance with its terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors’ rights and to general equity
principles; (2) the Securities have been duly authorized and executed by the
Company and have been delivered to the Trustee for authentication in accordance
with this Indenture; (3) the Securities are not required to be registered under
the Securities Act; and (4) the Indenture is not required to be qualified under
the Trust Indenture Act.

 

(b)                                 The Securities shall be executed on behalf of the
Company by its Chairman of the Board, its Vice Chairman of the Board, its Chief
Executive Officer, its President or one of its Vice Presidents. The signature
of any of these officers on the Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures of individuals who were
at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities.

 

(c)                                  No Security shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose, unless there appears on
such Security a certificate of authentication substantially in the form
provided for herein executed by the Trustee by the manual signature of one of
its authorized signatories, and such certificate upon any Security shall be
conclusive evidence, and the only evidence, that such Security has been duly
authenticated and delivered

 

25

 

hereunder.
Notwithstanding the foregoing, if any Security shall have been authenticated
and delivered hereunder but never issued and sold by the Company, and the
Company shall deliver such Security to the Trustee for cancellation as provided
in Section 3.8, for all purposes of this Indenture such Security
shall be deemed never to have been authenticated and delivered hereunder and
shall never be entitled to the benefits of this Indenture.

 

(d)                                 Each Security shall be dated the date of its
authentication.

 

SECTION 3.4. Global
Securities.

 

(a)                                  Upon the election of the Holder after the Original
Issue Date, which election need not be in writing, the Securities owned by such
Holder shall be issued in the form of one or more Global Securities registered
in the name of the Depositary or its nominee. Each Global Security issued under
this Indenture shall be registered in the name of the Depositary designated by
the Company for such Global Security or a nominee thereof and delivered to such
Depositary or a nominee thereof or custodian therefor, and each such Global
Security shall constitute a single Security for all purposes of this Indenture.

 

(b)                                 Notwithstanding any other provision in this Indenture,
no Global Security may be exchanged in whole or in part for Securities
registered, and no transfer of a Global Security in whole or in part may be
registered, in the name of any Person other than the Depositary for such Global
Security or a nominee thereof unless (i) such Depositary advises the Trustee
and the Company in writing that such Depositary is no longer willing or able to
properly discharge its responsibilities as Depositary with respect to such
Global Security, and no qualified successor is appointed by the Company within
ninety (90) days of receipt by the Company of such notice, (ii) such Depositary
ceases to be a clearing agency registered under the Exchange Act and no
successor is appointed by the Company within ninety (90) days after obtaining
knowledge of such event, (iii) the Company executes and delivers to the Trustee
a Company Order stating that the Company elects to terminate the book-entry
system through the Depositary or (iv) an Event of Default shall have occurred
and be continuing. Upon the occurrence of any event specified in clause (i),
(ii), (iii) or (iv) above, the Trustee shall notify the Depositary and instruct
the Depositary to notify all owners of beneficial interests in such Global
Security of the occurrence of such event and of the availability of Securities
to such owners of beneficial interests requesting the same. The Trustee may
conclusively rely, and be protected in relying, upon the written identification
of the owners of beneficial interests furnished by the Depositary, and shall
not be liable for any delay resulting from a delay by the Depositary. Upon the
issuance of such Securities and the registration in the Securities Register of
such Securities in the names of the Holders of the beneficial interests
therein, the Trustees shall recognize such holders of beneficial interests as
Holders.

 

(c)                                  If any Global Security is to be exchanged for other
Securities or canceled in part, or if another Security is to be exchanged in
whole or in part for a beneficial interest in any Global Security, then either
(i) such Global Security shall be so surrendered for exchange or cancellation
as provided in this Article III or (ii) the principal amount
thereof shall be reduced or increased by an amount equal to the portion thereof
to be so exchanged or canceled, or equal to the principal amount of such other
Security to be so exchanged for a beneficial interest therein, as the case may
be, by means of an appropriate adjustment made on the records of the Securities
Registrar, whereupon the Trustee, in accordance with the Applicable Depository
Procedures,

 

26

 

shall
instruct the Depositary or its authorized representative to make a
corresponding adjustment to its records. Upon any such surrender or adjustment
of a Global Security by the Depositary, accompanied by registration
instructions, the Company shall execute and the Trustee shall authenticate and
deliver any Securities issuable in exchange for such Global Security (or any
portion thereof) in accordance with the instructions of the Depositary. The
Trustee shall not be liable for any delay in delivery of such instructions and
may conclusively rely on, and shall be fully protected in relying on, such
instructions.

 

(d)                                 Every Security authenticated and delivered upon
registration of transfer of, or in exchange for or in lieu of, a Global
Security or any portion thereof shall be authenticated and delivered in the
form of, and shall be, a Global Security, unless such Security is registered in
the name of a Person other than the Depositary for such Global Security or a
nominee thereof.

 

(e)                                  Securities distributed to holders of Book-Entry
Preferred Securities (as defined in the applicable Trust Agreement) upon the
dissolution of the Trust shall be distributed in the form of one or more Global
Securities registered in the name of a Depositary or its nominee, and deposited
with the Securities Registrar, as custodian for such Depositary, or with such
Depositary, for credit by the Depositary to the respective accounts of the
beneficial owners of the Securities represented thereby (or such other accounts
as they may direct). Securities distributed to holders of Preferred Securities
other than Book-Entry Preferred Securities upon the dissolution of the Trust
shall not be issued in the form of a Global Security or any other form intended
to facilitate book-entry trading in beneficial interests in such Securities.

 

(f)                                    The Depositary or its nominee, as the registered owner
of a Global Security, shall be the Holder of such Global Security for all
purposes under this Indenture and the Securities, and owners of beneficial
interests in a Global Security shall hold such interests pursuant to the
Applicable Depository Procedures. Accordingly, any such owner’s beneficial
interest in a Global Security shall be shown only on, and the transfer of such
interest shall be effected only through, records maintained by the Depositary
or its nominee or its Depositary Participants. The Securities Registrar and the
Trustee shall be entitled to deal with the Depositary for all purposes of this
Indenture relating to a Global Security (including the payment of principal and
interest thereon and the giving of instructions or directions by owners of
beneficial interests therein and the giving of notices) as the sole Holder of
the Security and shall have no obligations to the owners of beneficial
interests therein. Neither the Trustee nor the Securities Registrar shall have
any liability in respect of any transfers effected by the Depositary.

 

(g)                                 The rights of owners of beneficial interests in a
Global Security shall be exercised only through the Depositary and shall be
limited to those established by law and agreements between such owners and the
Depositary and/or its Depositary Participants.

 

(h)                                 No holder of any beneficial interest in any Global
Security held on its behalf by a Depositary shall have any rights under this
Indenture with respect to such Global Security, and such Depositary may be
treated by the Company, the Trustee and any agent of the Company or the Trustee
as the owner of such Global Security for all purposes whatsoever. None of the
Company, the Trustee nor any agent of the Company or the Trustee will have any
responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership interests of a Global Security
or maintaining, supervising or reviewing any records relating to such
beneficial ownership interests. Notwithstanding the foregoing, nothing herein

 

27

 

shall prevent
the Company, the Trustee or any agent of the Company or the Trustee from giving
effect to any written certification, proxy or other authorization furnished by
a Depositary or impair, as between a Depositary and such holders of beneficial
interests, the operation of customary practices governing the exercise of the
rights of the Depositary (or its nominee) as Holder of any Security.

 

SECTION 3.5. Registration, Transfer and Exchange Generally.

 

(a)                                  The Trustee shall cause to be kept at the Corporate Trust
Office a register (the “Securities Register”) in
which the registrar and transfer agent with respect to the Securities (the “Securities Registrar”), subject to such reasonable
regulations as it may prescribe, shall provide for the registration of Securities
and of transfers and exchanges of Securities. The Trustee shall at all times
also be the Securities Registrar. The provisions of Article VI
shall apply to the Trustee in its role as Securities Registrar.

 

(b)                                 Subject to compliance with Section 2.2(b),
upon surrender for registration of transfer of any Security at the offices or
agencies of the Company designated for that purpose the Company shall execute,
and the Trustee shall authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Securities of any authorized
denominations of like tenor and aggregate principal amount.

 

(c)                                  At the option of the Holder, Securities may be
exchanged for other Securities of any authorized denominations, of like tenor
and aggregate principal amount, upon surrender of the Securities to be
exchanged at such office or agency. Whenever any Securities are so surrendered
for exchange, the Company shall execute, and the Trustee shall authenticate and
deliver, the Securities that the Holder making the exchange is entitled to
receive.

 

(d)                                 All Securities issued upon any transfer or exchange of
Securities shall be the valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the Securities
surrendered upon such transfer or exchange.

 

(e)                                  Every Security presented or surrendered for transfer or
exchange shall (if so required by the Company or the Trustee) be duly endorsed,
or be accompanied by a written instrument of transfer in form satisfactory to
the Company and the Securities Registrar, duly executed by the Holder thereof
or such Holder’s attorney duly authorized in writing.

 

(f)                                    No service charge shall be made to a Holder for any
transfer or exchange of Securities, but the Company may require payment of a
sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any transfer or exchange of Securities.

 

(g)                                 Neither the Company nor the Trustee shall be required
pursuant to the provisions of this Section 3.5 (g): (i) to issue, register
the transfer of or exchange any Security during a period beginning at the
opening of business fifteen (15) days before the day of selection for
redemption of Securities pursuant to Article XI and ending at the
close of business on the day of mailing of the notice of redemption or (ii) to
register the transfer of or exchange any Security so selected for redemption in
whole or in part, except, in the case of any such Security to be redeemed in
part, any portion thereof not to be redeemed.

 

28

 

(h)                                 The Company shall designate an office or offices or
agency or agencies where Securities may be surrendered for registration or
transfer or exchange. The Company initially designates the Corporate Trust
Office as its office and agency for such purposes. The Company shall give
prompt written notice to the Trustee and to the Holders of any change in the
location of any such office or agency.

 

SECTION 3.6. Mutilated, Destroyed, Lost and Stolen Securities.

 

(a)                                  If any mutilated Security is surrendered to the Trustee
together with such security or indemnity as may be required by the Trustee to
save the Company and the Trustee harmless, the Company shall execute and the
Trustee shall authenticate and deliver in exchange therefor a new Security of
like tenor and aggregate principal amount and bearing a number not
contemporaneously outstanding.

 

(b)                                 If there shall be delivered to the Trustee (i) evidence
to its satisfaction of the destruction, loss or theft of any Security and (ii)
such security or indemnity as may be required by it to save each of the Company
and the Trustee harmless, then, in the absence of notice to the Company or the
Trustee that such Security has been acquired by a bona fide purchaser, the Company shall execute and upon its
written request the Trustee shall authenticate and deliver, in lieu of any such
destroyed, lost or stolen Security, a new Security of like tenor and aggregate
principal amount as such destroyed, lost or stolen Security, and bearing a
number not contemporaneously outstanding.

 

(c)                                  If any such mutilated, destroyed, lost or stolen
Security has become or is about to become due and payable, the Company in its
discretion may, instead of issuing a new Security, pay such Security.

 

(d)                                 Upon the issuance of any new Security under this Section 3.6, the Company may require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.

 

(e)                                  Every new Security issued pursuant to this Section 3.6
in lieu of any mutilated, destroyed, lost or stolen Security shall constitute
an original additional contractual obligation of the Company, whether or not
the mutilated, destroyed, lost or stolen Security shall be at any time
enforceable by anyone, and shall be entitled to all the benefits of this
Indenture equally and proportionately with any and all other Securities duly
issued hereunder.

 

(f)                                    The provisions of this Section 3.6 are
exclusive and shall preclude (to the extent lawful) all other rights and
remedies with respect to the replacement or payment of mutilated, destroyed,
lost or stolen Securities.

 

SECTION 3.7.
Persons Deemed Owners.

 

The
Company, the Trustee and any agent of the Company or the Trustee shall treat
the Person in whose name any Security is registered as the owner of such
Security for the purpose of receiving payment of principal of and any interest
on such Security and for all other purposes whatsoever, and neither the
Company, the Trustee nor any agent of the Company or the Trustee shall be
affected by notice to the contrary.

 

29

 

SECTION 3.8. Cancellation.

 

All
Securities surrendered for payment, redemption, transfer or exchange shall, if
surrendered to any Person other than the Trustee, be delivered to the Trustee,
and any such Securities and Securities surrendered directly to the Trustee for
any such purpose shall be promptly canceled by it. The Company may at any time
deliver to the Trustee for cancellation any Securities previously authenticated
and delivered hereunder that the Company may have acquired in any manner
whatsoever, and all Securities so delivered shall be promptly canceled by the
Trustee. No Securities shall be authenticated in lieu of or in exchange for any
Securities canceled as provided in this Section 3.8, except as expressly permitted by this Indenture. All
canceled Securities shall be retained by the Trustee in accordance with its
customary practices.

 

SECTION 3.9.
Deferrals of Interest Payment Dates.

 

(a)                                  So long as no Event of Default has occurred and is
continuing, the Company shall have the right, at any time and from time to time
during the term of the Security, to defer the payment of interest on the
Securities for a period of up to twenty (20) consecutive quarterly interest
payment periods (each such period, an “Extension Period”), during
which Extension Period(s), the Company shall have the right to make no payments
or partial payments of interest on any Interest Payment Date (except any
Additional Tax Sums that otherwise may be due and payable). No Extension Period
shall end on a date other than an Interest Payment Date and no Extension Period
shall extend beyond the Stated Maturity of the principal of the Securities. No
interest shall be due and payable during an Extension Period, except at the end
thereof, but each installment of interest that would otherwise have been due
and payable during such Extension Period shall bear Additional Interest (to the
extent payment of such interest would be legally enforceable) at the rate equal
to a variable rate equal to LIBOR plus 3.90% per annum, compounded quarterly,
from the dates on which amounts would have otherwise been due and payable until
paid or until funds for the payment thereof have been made available for
payment. At the end of any such Extension Period, the Company shall pay all
interest then accrued and unpaid on the Securities together with such
Additional Interest. Prior to the termination of any such Extension Period, the
Company may extend such Extension Period and further defer the payment of
interest; provided, that (i) all such previous and
further extensions comprising such Extension Period do not exceed twenty (20)
quarterly interest payment periods, (ii) no Extension Period shall end on a
date other than an Interest Payment Date and (iii) no Extension Period shall
extend beyond the Stated Maturity of the principal of the Securities. Upon the
termination of any such Extension Period and upon the payment of all accrued
and unpaid interest and any Additional Interest then due on any Interest
Payment Date, the Company may elect to begin a new Extension Period; provided, that (i) such Extension Period does not exceed
twenty (20) quarterly interest payment periods, (ii) no Extension Period shall
end on a date other than an Interest Payment Date and (iii) no Extension Period
shall extend beyond the Stated Maturity of the principal of the Securities. The
Company shall give the Holders of the Securities and the Trustee written notice
of its election to begin any such Extension Period at least one Business Day
prior to the next succeeding Interest Payment Date on which interest on the Securities
would be payable but for such deferral or, so long as any Securities are held
by the Trust, at least one Business Day prior to the earlier of (i) the next
succeeding date on which Distributions on the Preferred Securities of such
Trust would be payable but for such deferral and (ii) the date on which the
Property Trustee of such Trust is required to give notice to any securities
exchange or

 

30

 

other
applicable self-regulatory organization or to holders of such Preferred
Securities of the record date for the payment of such Distributions.

 

(b)                                 In connection with any such Extension Period, the
Company shall be subject to the restrictions set forth in Section 10.6(a).

 

SECTION 3.10. Right of Set-Off.

 

Notwithstanding
anything to the contrary herein, the Company shall have the right to set off
any payment it is otherwise required to make in respect of any Security to the
extent the Company has theretofore made, or is concurrently on the date of such
payment making, a payment under the Guarantee Agreement relating to such
Security or to a holder of Preferred Securities pursuant to an action
undertaken under Section 5.8 of this Indenture.

 

SECTION 3.11.
Agreed Tax Treatment.

 

Each
Security issued hereunder shall provide that the Company and, by its acceptance
or acquisition of a Security or a beneficial interest therein, the Holder of,
and any Person that acquires a direct or indirect beneficial interest in, such
Security, intend and agree to treat such Security as indebtedness of the
Company for United States Federal, state and local tax purposes and to treat
the Preferred Securities (including but not limited to all payments and
proceeds with respect to the Preferred Securities) as an undivided beneficial ownership
interest in the Securities (and any other Trust property) (and payments and
proceeds therefrom, respectively) for United States Federal, state and local
tax purposes. The provisions of this Indenture shall be interpreted to further
this intention and agreement of the parties.

 

SECTION 3.12. CUSIP Numbers.

 

The
Company in issuing the Securities may use “CUSIP” numbers (if then generally in
use), and, if so, the Trustee shall use “CUSIP” numbers in notices of
redemption and other similar or related materials as a convenience to Holders; provided, that any such notice or other materials may state
that no representation is made as to the correctness of such numbers either as
printed on the Securities or as contained in any notice of redemption or other materials
and that reliance may be placed only on the other identification numbers
printed on the Securities, and any such redemption shall not be affected by any
defect in or omission of such numbers.

 

ARTICLE IV

 

SATISFACTION
AND DISCHARGE

 

SECTION 4.1. Satisfaction and Discharge of Indenture.

 

This
Indenture shall, upon Company Request, cease to be of further effect (except as
to any surviving rights of registration of transfer or exchange of Securities
herein expressly provided for and as otherwise provided in this Section 4.1)
and the Trustee, on demand of and at the expense of the Company, shall execute
proper instruments acknowledging satisfaction and discharge of this Indenture,
when

 

(a)                                  either

 

31

 

(i)
all Securities theretofore authenticated and delivered (other than (A)
Securities that have been mutilated, destroyed, lost or stolen and that have
been replaced or paid as provided in Section 3.6 and (B) Securities
for whose payment money has theretofore been deposited in trust or segregated
and held in trust by the Company and thereafter repaid to the Company or
discharged from such trust as provided in Section 10.2) have been
delivered to the Trustee for cancellation; or

 

(ii)
all such Securities not theretofore delivered to the Trustee for cancellation

 

(A)                              have become due and payable, or

 

(B)                                will become due and payable at their Stated Maturity
within one year of the date of deposit, or

 

(C)                                are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of redemption
by the Trustee in the name, and at the expense, of the Company,

 

and the
Company, in the case of subclause (ii)(A), (B) or (C) above, has deposited or
caused to be deposited with the Trustee as trust funds in trust for such
purpose (x) an amount in the currency or currencies in which the Securities are
payable, (y) Government Obligations which through the scheduled payment of
principal and interest in respect thereof in accordance with their terms will
provide, not later than the due date of any payment, money in an amount or (z)
a combination thereof, in each case sufficient, in the opinion of a nationally
recognized firm of independent public accountants expressed in a written certification
thereof delivered to the Trustee, to pay and discharge the entire indebtedness
on such Securities not theretofore delivered to the Trustee for cancellation,
for principal and any premium and interest (including any Additional Interest)
to the date of such deposit (in the case of Securities that have become due and
payable) or to the Stated Maturity (or any date of principal repayment upon
early maturity) or Redemption Date, as the case may be;

 

(b)                                 the Company has paid or caused to be paid all other
sums payable hereunder by the Company; and

 

(c)                                  the Company has delivered to the Trustee an Officers’
Certificate and an Opinion of Counsel each stating that all conditions
precedent herein provided for relating to the satisfaction and discharge of
this Indenture have been complied with.

 

Notwithstanding
the satisfaction and discharge of this Indenture, the obligations of the
Company to the Trustee under Section 6.6, the
obligations of the Company to any Authenticating Agent under Section 6.11
and, if money shall have been deposited with the Trustee pursuant to subclause
(a)(ii) of this Section 4.1, the
obligations of the Trustee under Section 4.2 and Section 10.2(e)
shall survive.

 

SECTION 4.2.
Application of Trust Money.

 

Subject
to the provisions of Section 10.2(e), all
money deposited with the Trustee pursuant to Section 4.1 shall be
held in trust and applied by the Trustee, in accordance with the

 

32

 

provisions
of the Securities and this Indenture, to the payment in accordance with Section 3.1,
either directly or through any Paying Agent (including the Company acting as
its own Paying Agent) as the Trustee may determine, to the Persons entitled
thereto, of the principal and any premium and interest (including any
Additional Interest) for the payment of which such money or obligations have
been deposited with or received by the Trustee. Moneys held by the Trustee
under this Section 4.2 shall not be subject to the claims of
holders of Senior Debt under Article XII.

 

ARTICLE V

 

REMEDIES

 

SECTION 5.1. Events of
Default.

 

“Event of Default” means, wherever used herein with respect to the Securities, any one of the
following events (whatever the reason for such Event of Default and whether it
shall be voluntary or involuntary or be effected by operation of law or
pursuant to any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body):

 

(a)                                  default in the payment of any interest upon any
Security, including any Additional Interest in respect thereof, when it becomes
due and payable, and continuance of such default for a period of thirty (30)
days (subject to the deferral of any due date in the case of an Extension
Period); or

 

(b)                                 default in the payment of the principal of or any
premium on any Security at its Maturity; or

 

(c)                                  default in the performance, or breach, of any covenant
or warranty of the Company in this Indenture and continuance of such default or
breach for a period of thirty (30) days after there has been given, by
registered or certified mail, to the Company by the Trustee or to the Company
and the Trustee by the Holders of at least twenty five percent (25%) in
aggregate principal amount of the Outstanding Securities a written notice
specifying such default or breach and requiring it to be remedied and stating
that such notice is a “Notice of Default” hereunder;

 

(d)                                 the entry by a court having jurisdiction in the
premises of a decree or order adjudging the Company a bankrupt or insolvent, or
approving as properly filed a petition seeking reorganization, arrangement,
adjustment or composition of or in respect of the Company under any applicable
Federal or state bankruptcy, insolvency, reorganization or other similar law,
or appointing a custodian, receiver, liquidator, assignee, trustee,
sequestrator or other similar official of the Company or of any substantial
part of its property, or ordering the winding up or liquidation of its affairs,
and the continuance of any such decree or order for relief or any such other
decree or order unstayed and in effect for a period of sixty (60) consecutive
days;

 

(e)                                  the institution by the Company of proceedings to be
adjudicated a bankrupt or insolvent, or the consent by the Company to the
institution of bankruptcy or insolvency proceedings against it, or the filing
by the Company of a petition or answer or consent seeking reorganization or
relief under any applicable Federal or state bankruptcy, insolvency,
reorganization or other similar law, or the consent by it to the filing of such
petition or to the

 

33

 

appointment
of or taking possession by a custodian, receiver, liquidator, assignee,
trustee, sequestrator or other similar official of the Company or of any substantial
part of its property, or the making by it of an assignment for the benefit of
creditors, or the admission by it in writing of its inability to pay its debts
generally as they become due and its willingness to be adjudicated a bankrupt
or insolvent, or the taking of corporate action by the Company in furtherance
of any such action; or

 

(f)                                    the Trust shall have voluntarily or involuntarily
liquidated, dissolved, wound-up its business or otherwise terminated its
existence, except in connection with (1) the distribution of the Securities to
holders of the Preferred Securities in liquidation of their interests in the
Trust, (2) the redemption of all of the outstanding Preferred Securities or (3)
certain mergers, consolidations or amalgamations, each as and to the extent
permitted by the Trust Agreement.

 

SECTION 5.2.
Acceleration of Maturity; Rescission and Annulment.

 

(a)                                  If an Event of Default occurs and is continuing, then
and in every such case the Trustee or the Holders of not less than twenty five
percent (25%) in aggregate principal amount of the Outstanding Securities may
declare the principal amount of all the Securities to be due and payable
immediately, by a notice in writing to the Company (and to the Trustee if given
by Holders), provided, that if, upon an Event of Default, the Trustee or the
Holders of not less than twenty five percent (25%) in principal amount of the
Outstanding Securities fail to declare the principal of all the Outstanding
Securities to be immediately due and payable, the holders of at least twenty
five percent (25%) in aggregate Liquidation Amount of the Preferred Securities
then outstanding shall have the right to make such declaration by a notice in
writing to the Property Trustee, the Company and the Trustee; and upon any such
declaration the principal amount of and the accrued interest (including any
Additional Interest) on all the Securities shall become immediately due and
payable.

 

(b)                                 At any time after such a declaration of acceleration
with respect to Securities has been made and before a judgment or decree for
payment of the money due has been obtained by the Trustee as hereinafter
provided in this Article V, the Holders of a majority in aggregate
principal amount of the Outstanding Securities, by written notice to the
Indenture Trustee, or the holders of a majority in aggregate Liquidation Amount
of the Preferred Securities, by written notice to the Property Trustee, the
Company and the Trustee, may rescind and annul such declaration and its
consequences if:

 

(i) the
Company has paid or deposited with the Trustee a sum sufficient to pay:

 

(A)                              all overdue installments of interest on all Securities,

 

(B)                                any accrued Additional Interest on all Securities,

 

(C)                                the principal of and any premium on any Securities that
have become due otherwise than by such declaration of acceleration and interest
(including any Additional Interest) thereon at the rate borne by the
Securities, and

 

(D)                               all sums paid or advanced by the Trustee hereunder and
the reasonable compensation, expenses, disbursements and advances of the
Trustee, the Property Trustee and their agents and counsel; and

 

34

 

(ii)
all Events of Default with respect to Securities, other than the non-payment of
the principal of Securities that has become due solely by such acceleration,
have been cured or waived as provided in Section 5.13;

 

provided, that if the Holders of such Securities fail to annul
such declaration and waive such default, the holders of not less than a majority
in aggregate Liquidation Amount of the Preferred Securities then outstanding
shall also have the right to rescind and annul such declaration and its
consequences by written notice to the Property Trustee, the Company and the
Trustee, subject to the satisfaction of the conditions set forth in paragraph
(b) of this Section 5.2. No such
rescission shall affect any subsequent default or impair any right consequent
thereon.

 

SECTION 5.3.
Collection of Indebtedness and Suits for
Enforcement by Trustee.

 

(a)                                  The Company covenants that if:

 

(i)
default is made in the payment of any installment of interest (including any
Additional Interest) on any Security when such interest becomes due and payable
and such default continues for a period of thirty (30) days, or

 

(ii)
default is made in the payment of the principal of and any premium on any
Security at the Maturity thereof,

 

the
Company will, upon demand of the Trustee, pay to the Trustee, for the benefit
of the Holders of such Securities, the whole amount then due and payable on
such Securities for principal and any premium and interest (including any
Additional Interest) and, in addition thereto, all amounts owing the Trustee
under Section 6.6.

 

(b)                                 If the Company fails to pay such amounts forthwith upon
such demand, the Trustee, in its own name and as trustee of an express trust,
may institute a judicial proceeding for the collection of the sums so due and
unpaid, and may prosecute such proceeding to judgment or final decree, and may
enforce the same against the Company or any other obligor upon such Securities
and collect the moneys adjudged or decreed to be payable in the manner provided
by law out of the property of the Company or any other obligor upon the
Securities, wherever situated.

 

(c)                                  If an Event of Default with respect to Securities
occurs and is continuing, the Trustee may in its discretion proceed to protect
and enforce its rights and the rights of the Holders of Securities by such
appropriate judicial proceedings as the Trustee shall deem most effectual to
protect and enforce any such rights, whether for the specific enforcement of
any covenant or agreement in this Indenture or in aid of the exercise of any
power granted herein, or to enforce any other proper remedy.

 

SECTION 5.4.
Trustee May File Proofs of Claim.

 

In case
of any receivership, insolvency, liquidation, bankruptcy, reorganization,
arrangement, adjustment, composition or similar judicial proceeding relative to
the Company (or any other obligor upon the Securities), its property or its
creditors, the Trustee shall be entitled and empowered, by intervention in such
proceeding or otherwise, to take any and all actions authorized hereunder in
order to have claims of the Holders and the Trustee allowed in any such

 

35

 

proceeding.
In particular, the Trustee shall be authorized to collect and receive any
moneys or other property payable or deliverable on any such claims and to
distribute the same; and any custodian, receiver, assignee, trustee, liquidator,
sequestrator or other similar official in any such judicial proceeding is
hereby authorized by each Holder to make such payments to the Trustee and, in
the event that the Trustee shall consent to the making of such payments
directly to the Holders, to first pay to the Trustee any amount due it for the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel, and any other amounts owing the Trustee, any
predecessor Trustee and other Persons under Section 6.6.

 

SECTION 5.5.
Trustee May Enforce Claim Without Possession of
Securities.

 

All
rights of action and claims under this Indenture or the Securities may be
prosecuted and enforced by the Trustee without the possession of any of the
Securities or the production thereof in any proceeding relating thereto, and
any such proceeding instituted by the Trustee shall be brought in its own name
as trustee of an express trust, and any recovery of judgment shall, subject to Article XII
and after provision for the payment of all the amounts owing the Trustee, any
predecessor Trustee and other Persons under Section 6.6, be for the ratable benefit of the Holders of the
Securities in respect of which such judgment has been recovered.

 

SECTION 5.6.
Application of Money Collected.

 

Any money
or property collected or to be applied by the Trustee with respect to the
Securities pursuant to this Article V shall be applied in the
following order, at the date or dates fixed by the Trustee and, in case of the
distribution of such money or property on account of principal or any premium
or interest (including any Additional Interest), upon presentation of the
Securities and the notation thereon of the payment if only partially paid and
upon surrender thereof if fully paid:

 

FIRST: To
the payment of all amounts due the Trustee, any predecessor Trustee and other
Persons under Section 6.6;

 

SECOND:
To the payment of all Senior Debt of the Company if and to the extent required
by Article XII;

 

THIRD:
Subject to Article XII, to the
payment of the amounts then due and unpaid upon the Securities for principal
and any premium and interest (including any Additional Interest) in respect of
which or for the benefit of which such money has been collected, ratably,
without preference or priority of any kind, according to the amounts due and
payable on the Securities for principal and any premium and interest (including
any Additional Interest), respectively; and

 

FOURTH:
The balance, if any, to the Person or Persons entitled thereto.

 

SECTION 5.7.
Limitation on Suits.

 

Subject
to Section 5.8, no Holder of any Securities shall have any right to
institute any proceeding, judicial or otherwise, with respect to this Indenture
or for the appointment of a custodian, receiver, assignee, trustee, liquidator,
sequestrator (or other similar official) or for any other remedy hereunder,
unless:

 

36

 

(a)                                  such Holder has previously given written notice to the
Trustee of a continuing Event of Default with respect to the Securities;

 

(b)                                 the Holders of not less than a majority in aggregate
principal amount of the Outstanding Securities shall have made written request
to the Trustee to institute proceedings in respect of such Event of Default in
its own name as Trustee hereunder;

 

(c)                                  such Holder or Holders have offered to the Trustee
reasonable indemnity against the costs, expenses and liabilities to be incurred
in compliance with such request;

 

(d)                                 the Trustee after its receipt of such notice, request
and offer of indemnity has failed to institute any such proceeding for sixty
(60) days; and

 

(e)                                  no direction inconsistent with such written request has
been given to the Trustee during such sixty (60)-day period by the Holders of a
majority in aggregate principal amount of the Outstanding Securities;

 

it being
understood and intended that no one or more of such Holders shall have any
right in any manner whatever by virtue of, or by availing itself of, any
provision of this Indenture to affect, disturb or prejudice the rights of any
other Holders of Securities, or to obtain or to seek to obtain priority or
preference over any other of such Holders or to enforce any right under this
Indenture, except in the manner herein provided and for the equal and ratable
benefit of all such Holders.

 

SECTION 5.8.
Unconditional Right of Holders to Receive
Principal, Premium, if any, and Interest; Direct
Action by Holders of Preferred Securities.

 

Notwithstanding
any other provision in this Indenture, the Holder of any Security shall have the
right, which is absolute and unconditional, to receive payment of the principal
of and any premium on such Security at its Maturity and payment of interest
(including any Additional Interest) on such Security when due and payable and
to institute suit for the enforcement of any such payment, and such right shall
not be impaired without the consent of such Holder. Any registered holder of
the Preferred Securities shall have the right, upon the occurrence of an Event
of Default described in Section 5.1 (a) or Section 5.1(b), to institute a suit directly against the Company for
enforcement of payment to such holder of principal of and any premium and
interest (including any Additional Interest) on the Securities having a
principal amount equal to the aggregate Liquidation Amount of the Preferred
Securities held by such holder.

 

SECTION 5.9.
Restoration of Rights and Remedies.

 

If the
Trustee, any Holder or any holder of Preferred Securities has instituted any
proceeding to enforce any right or remedy under this Indenture and such
proceeding has been discontinued or abandoned for any reason, or has been
determined adversely to the Trustee, such Holder or such holder of Preferred
Securities, then and in every such case the Company, the Trustee, such Holders
and such holder of Preferred Securities shall, subject to any determination in
such proceeding, be restored severally and respectively to their former
positions hereunder, and thereafter all rights and remedies of the Trustee,
such Holder and such holder of Preferred Securities shall continue as though no
such proceeding had been instituted.

 

37

 

SECTION 5.10.
Rights and Remedies Cumulative.

 

Except as
otherwise provided in Section 3.6(f), no
right or remedy herein conferred upon or reserved to the Trustee or the Holders
is intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at
law or in equity or otherwise. The assertion or employment of any right or
remedy hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.

 

SECTION 5.11.
Delay or Omission Not Waiver.

 

No delay
or omission of the Trustee, any Holder of any Securities or any holder of any
Preferred Security to exercise any right or remedy accruing upon any Event of
Default shall impair any such right or remedy or constitute a waiver of any
such Event of Default or an acquiescence therein. Every right and remedy given
by this Article V or by law to the Trustee or to the Holders and
the right and remedy given to the holders of Preferred Securities by Section 5.8
may be exercised from time to time, and as often as may be deemed expedient, by
the Trustee, the Holders or the holders of Preferred Securities, as the case
may be.

 

SECTION 5.12.
Control by Holders.

 

The
Holders of not less than a majority in aggregate principal amount of the
Outstanding Securities (or, as the case may be, the holders of a majority in
aggregate Liquidation Amount of Preferred Securities) shall have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee or exercising any trust or power conferred on the
Trustee; provided, that:

 

(a)                                  such direction shall not be in conflict with any rule
of law or with this Indenture,

 

(b)                                 the Trustee may take any other action deemed proper by
the Trustee that is not inconsistent with such direction, and

 

(c)                                  subject to the provisions of Section 6.2, the Trustee shall have the right to decline to follow such direction if a
Responsible Officer or Officers of the Trustee shall, in good faith, reasonably
determine that the proceeding so directed would be unjustly prejudicial to the
Holders not joining in any such direction or would involve the Trustee in
personal liability.

 

SECTION 5.13.
Waiver of Past Defaults.

 

(a)                                  The Holders of not less than a majority in aggregate
principal amount of the Outstanding Securities or the holders of not less than
a majority in aggregate Liquidation Amount of the Preferred Securities may
waive any past Event of Default hereunder and its consequences except an Event
of Default:

 

(i)
in the payment of the principal of or any premium or interest (including any
Additional Interest) on any Security (unless such Event of Default has been
cured and the Company has paid to or deposited with the Trustee a sum
sufficient to pay all installments of interest (including any Additional
Interest) due and past due and all principal of and any premium on all
Securities due otherwise than by acceleration), or

 

38

 

(ii)
in respect of a covenant or provision hereof that under Article IX
cannot be modified or amended without the consent of each Holder of any
Outstanding Security.

 

(b)                                 Any such waiver shall be deemed to be on behalf of the
Holders of all the Securities or, in the case of a waiver by holders of Preferred
Securities issued by such Trust, by all holders of Preferred Securities.

 

(c)                                  Upon any such waiver, such Event of Default shall cease
to exist and any Event of Default arising therefrom shall be deemed to have
been cured for every purpose of this Indenture; but no such waiver shall extend
to any subsequent or other Event of Default or impair any right consequent
thereon.

 

SECTION 5.14.
Undertaking for Costs.

 

All
parties to this Indenture agree, and each Holder of any Security by his or her
acceptance thereof shall be deemed to have agreed, that any court may in its
discretion require, in any suit for the enforcement of any right or remedy
under this Indenture, or in any suit against the Trustee for any action taken
or omitted by it as Trustee, the filing by any party litigant in such suit of
an undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys’ fees and
expenses, against any party litigant in such suit, having due regard to the
merits and good faith of the claims or defenses made by such party litigant;
but the provisions of this Section 5.14 shall not apply to any suit
instituted by the Trustee, to any suit instituted by any Holder, or group of
Holders, holding in the aggregate more than ten percent (10%) in aggregate
principal amount of the Outstanding Securities, or to any suit instituted by
any Holder for the enforcement of the payment of the principal of or any
premium on the Security after the Stated Maturity or any interest (including
any Additional Interest) on any Security after it is due and payable.

 

SECTION 5.15. Waiver of Usury, Stay or
Extension Laws.

 

The
Company covenants (to the extent that it may lawfully do so) that it will not
at any time insist upon, or plead, or in any manner whatsoever claim or take
the benefit or advantage of, any usury, stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants or the
performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and covenants that it will not hinder, delay or impede the execution of
any power herein granted to the Trustee, but will suffer and permit the
execution of every such power as though no such law had been enacted.

 

ARTICLE VI

 

THE TRUSTEE

 

SECTION 6.1.
Corporate Trustee Required.

 

There
shall at all times be a Trustee hereunder with respect to the Securities. The
Trustee shall be a corporation organized and doing business under the laws of
the United States or of any state thereof, authorized to exercise corporate
trust powers, having a combined capital and surplus of at least $50,000,000,
subject to supervision or examination by Federal or state

 

39

 

authority
and having an office within the United States. If such corporation publishes
reports of condition at least annually, pursuant to law or to the requirements
of such supervising or examining authority, then, for the purposes of this Section 6.1, the combined capital and surplus of such corporation
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published. If at any time the Trustee shall cease
to be eligible in accordance with the provisions of this Section 6.1, it shall resign immediately in the manner and with the effect hereinafter
specified in this Article VI.

 

SECTION 6.2.
Certain Duties and Responsibilities.

 

Except
during the continuance of an Event of Default:

 

(i)
the Trustee undertakes to perform such duties and only such duties as are
specifically set forth in this Indenture, and no implied covenants or
obligations shall be read into this Indenture against the Trustee; and

 

(ii)
in the absence of bad faith on its part, the Trustee may conclusively rely, as
to the truth of the statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the Trustee and conforming
to the requirements of this Indenture; provided, that
in the case of any such certificates or opinions that by any provision hereof
are specifically required to be furnished to the Trustee, the Trustee shall be
under a duty to examine the same to determine whether or not they substantially
conform on their face to the requirements of this Indenture.

 

(b)                                 If an Event of Default known to the Trustee has
occurred and is continuing, the Trustee shall, prior to the receipt of
directions, if any, from the Holders of at least a majority in aggregate
principal amount of the Outstanding Securities (or, if applicable, from the
holders of at least a majority in aggregate Liquidation Amount of Preferred
Securities), exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in its exercise, as a
prudent person would exercise or use under the circumstances in the conduct of
such person’s own affairs.

 

(c)                                  Notwithstanding the foregoing, no provision of this
Indenture shall require the Trustee to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if it shall have
reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it.
Whether or not therein expressly so provided, every provision of this Indenture
relating to the conduct or affecting the liability of or affording protection
to the Trustee shall be subject to the provisions of this Section 6.2. To the extent that, at law or in equity, the Trustee has duties and
liabilities relating to the Holders, the Trustee shall not be liable to any
Holder or any holder of Preferred Securities for the Trustee’s good faith
reliance on the provisions of this Indenture. The provisions of this Indenture,
to the extent that they restrict the duties and liabilities of the Trustee
otherwise existing at law or in equity, are agreed by the Company and the
Holders and the holders of Preferred Securities to replace such other duties
and liabilities of the Trustee.

 

40

 

(d)                                 No provisions of this indenture shall be construed to
relieve the Trustee from liability with respect to matters that are within the
authority of the Trustee under this Indenture for its own negligent action,
negligent failure to act or willful misconduct, except that:

 

(i)
the Trustee shall not be liable for any error or judgment made in good faith by
an authorized officer of the Trustee, unless it shall be proved that the
Trustee was negligent in ascertaining the pertinent facts;

 

(ii)
the Trustee shall not be liable with respect to any action taken or omitted to
be taken by it in good faith in accordance with the direction of the Holders of
at least a majority in aggregate principal amount of the Outstanding Securities
(or, as the case may be, the holders of a majority in aggregate Liquidation
Amount of Preferred Securities) relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee under this
Indenture; and

 

(iii)
the Trustee shall be under no liability for interest on any money received by
it hereunder except as otherwise agreed in writing with the Company and money
held by the Trustee in trust hereunder need not be segregated from other funds
except to the extent required by law.

 

(e)                                  if at any time the Trustee hereunder is not the same
Person as the Property  Trustee under the Trust Agreement:

 

(i)
whenever a reference is made herein to the dissolution, termination or
liquidation of the Trust, the Trustee shall be entitled to assume that no such
dissolution, termination, or liquidation has occurred so long as the Securities
are or continue to be registered in the name of such Property Trustee, and the
Trustee shall be charged with notice or knowledge of such dissolution,
termination or liquidation only upon written notice thereof given to the
Trustee by the Depositor under the Trust Agreement; and

 

(ii)
the Trustee shall not be charged with notice or knowledge that any Person is a
holder of Preferred Securities or Common Securities issued by the Trust or
whether any group of holders of Preferred Securities constitutes any specified
percentage of all outstanding Preferred Securities for any purpose under this
Indenture, unless and until the Trustee is furnished with a list of holders by
such Property Trustee and the aggregate Liquidation Amount of the Preferred
Securities then outstanding. The Trustee may conclusively rely and shall be
protected in relying on such list.

 

(f)                                    Notwithstanding Section 1.10, the Trustee shall not, and shall not be deemed to, owe any fiduciary duty
to the holders of any of the Trust Securities issued by the Trust and shall not
be liable to any such holder (other than for the willful misconduct or
negligence of the Trustee) if the Trustee in good faith (i) pays over or
distributes to a registered Holder of the Securities or to the Company or to
any other Person, cash, property or securities to which such holders of such
Trust Securities shall be entitled or (ii) takes any action or omits to take
any action at the request of the Holder of such Securities. Nothing in this
paragraph shall affect the obligation of any other such Person to hold such
payment for the benefit of, and to pay such amount over to, such holders of
Preferred Securities or Common Securities or their representatives.

 

41

 

SECTION 6.3. Notice of
Defaults.

 

Within
ninety (90) days after the occurrence of any default actually known to the
Trustee, the Trustee shall give the Holders notice of such default unless such
default shall have been cured or waived; provided, that
in the case of any default of the character specified in Section 5.1 c), no such notice to Holders shall be given until at
least thirty (30) days after the occurrence thereof. For the purpose of this Section 6.3, the term “default” means any event which is, or after notice or lapse of
time or both would become, an Event of Default.

 

SECTION 6.4.
Certain Rights of Trustee.

 

Subject
to the provisions of Section 6.2:

 

(a)                                  the Trustee may conclusively rely and shall be fully
protected in acting or refraining from acting in good faith and in accordance
with the terms hereof upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note or other paper or document believed by it to be genuine and to have been
signed or presented by the proper party or parties;

 

(b)                                 if (i) in performing its duties under this Indenture
the Trustee is required to decide between alternative courses of action, (ii)
in construing any of the provisions of this Indenture the Trustee finds
ambiguous or inconsistent with any other provisions contained herein or (iii)
the Trustee is unsure of the application of any provision of this Indenture,
then, except as to any matter as to which the Holders are entitled to decide
under the terms of this Indenture, the Trustee shall deliver a notice to the
Company requesting the Company’s written instruction as to the course of action
to be taken and the Trustee shall take such action, or refrain from taking such
action, as the Trustee shall be instructed in writing to take, or to refrain
from taking, by the Company; provided, that
if the Trustee does not receive such instructions from the Company within ten
Business Days after it has delivered such notice or such reasonably shorter
period of time set forth in such notice the Trustee may, but shall be under no
duty to, take such action, or refrain from taking such action, as the Trustee
shall deem advisable and in the best interests of the Holders, in which event
the Trustee shall have no liability except for its own negligence, bad faith or
willful misconduct;

 

(c)                                  any request or direction of the Company shall be
sufficiently evidenced by a Company Request or Company Order and any resolution
of the Board of Directors may be sufficiently evidenced by a Board Resolution;

 

(d)                                 the Trustee may consult with counsel (which counsel may
be counsel to the Trustee, the Company or any of its Affiliates, and may
include any of its employees) and the advice of such counsel or any Opinion of
Counsel shall be full and complete authorization and protection in respect of
any action taken, suffered or omitted by it hereunder in good faith and in
reliance thereon;

 

(e)                                  the Trustee shall be under no obligation to exercise
any of the rights or powers vested in it by this Indenture at the request or
direction of any of the Holders or any holder of Preferred Securities pursuant
to this Indenture, unless such Holders (or such holders of Preferred
Securities) shall have offered to the Trustee security or indemnity reasonably
satisfactory to it against the costs, expenses (including reasonable attorneys’
fees and expenses) and liabilities that

 

42

 

might be
incurred by it in compliance with such request or direction, including
reasonable advances as may be requested by the Trustee;

 

(f)                                    the Trustee shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction, consent,
order, bond, indenture, note or other paper or document, but the Trustee in its
discretion may make such inquiry or investigation into such facts or matters as
it may see fit, and, if the Trustee shall determine to make such inquiry or
investigation, it shall be entitled to examine the books, records and premises
of the Company, personally or by agent or attorney;

 

(g)                                 the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents, attorneys, custodians or nominees and the Trustee shall not be
responsible for any misconduct or negligence on the part of any such agent,
attorney, custodian or nominee appointed with due care by it hereunder;

 

(h)                                 whenever in the administration of this Indenture the
Trustee shall deem it desirable to receive instructions with respect to
enforcing any remedy or right or taking any other action with respect to
enforcing any remedy or right hereunder, the Trustees (i) may request
instructions from the Holders (which instructions may only be given by the
Holders of the same aggregate principal amount of Outstanding Securities as
would be entitled to direct the Trustee under this Indenture in respect of such
remedy, right or action), (ii) may refrain from enforcing such remedy or right
or taking such action until such instructions are received and (iii) shall be
protected in acting in accordance with such instructions;

 

(i)                                     except as otherwise expressly provided by this
Indenture, the Trustee shall not be under any obligation to take any action
that is discretionary under the provisions of this Indenture;

 

(j)                                     without prejudice to any other rights available to the
Trustee under applicable law, when the Trustee incurs expenses or renders
services in connection with any bankruptcy, insolvency or other proceeding
referred to in clauses (d) or (e) of the definition of Event of Default, such
expenses (including legal fees and expenses of its agents and counsel) and the
compensation for such services are intended to constitute expenses of administration
under any bankruptcy laws or law relating to creditors rights generally;

 

(k)                                  whenever in the administration of this Indenture the
Trustee shall deem it desirable that a matter be proved or established prior to
taking, suffering or omitting any action hereunder, the Trustee (unless other
evidence be herein specifically prescribed) may, in the absence of bad faith on
its part, conclusively rely upon an Officers’ Certificate addressing such
matter, which, upon receipt of such request, shall be promptly delivered by the
Company;

 

(l)                                     the Trustee shall not be charged with knowledge of any
Event of Default unless either (i) a Responsible Officer of the Trustee shall
have actual knowledge or (ii) the Trustee shall have received written notice
thereof from the Company or a Holder; and

 

(m)                               in the event that the Trustee is also acting as Paying
Agent, Authenticating Agent or Securities Registrar hereunder, the rights and
protections afforded to the Trustee pursuant to this Article VI
shall also be afforded such Paying Agent, Authenticating Agent, or Securities
Registrar.

 

43

 

SECTION 6.5. May Hold Securities.

 

The
Trustee, any Authenticating Agent, any Paying Agent, any Securities Registrar
or any other agent of the Company, in its individual or any other capacity, may
become the owner or pledgee of Securities and may otherwise deal with the
Company with the same rights it would have if it were not Trustee,
Authenticating Agent, Paying Agent, Securities Registrar or such other agent.

 

SECTION 6.6. Compensation; Reimbursement; Indemnity.

 

(a)                                  The Company agrees

 

(i)
to pay to the Trustee from time to time reasonable compensation for all
services rendered by it hereunder in such amounts as the Company and the
Trustee shall agree from time to time (which compensation shall not be limited
by any provision of law in regard to the compensation of a trustee of an
express trust);

 

(ii)
to reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee in accordance with
any provision of this Indenture (including the reasonable compensation and the
expenses and disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence, bad faith or
willful misconduct; and

 

(iii)
to the fullest extent permitted by applicable law, to indemnify the Trustee and
its Affiliates, and their officers, directors, shareholders, agents,
representatives and employees for, and to hold them harmless against, any loss,
damage, liability, tax (other than income, franchise or other taxes imposed on
amounts paid pursuant to (i) or (ii) hereof), penalty, expense or claim of any
kind or nature whatsoever incurred without negligence, bad faith or willful
misconduct on its part arising out of or in connection with the acceptance or
administration of this trust or the performance of the Trustee’s duties
hereunder, including the costs and expenses of defending itself against any
claim or liability in connection with the exercise or performance of any of its
powers or duties hereunder.

 

(b)                                 To secure the Company’s payment obligations in this Section 6.6, the Company hereby grants and pledges to the Trustee and the Trustee shall
have a lien prior to the Securities on all money or property held or collected
by the Trustee, other than money or property held in trust to pay principal and
interest on particular Securities. Such lien shall survive the satisfaction and
discharge of this Indenture or the resignation or removal of the Trustee.

 

(c)                                  The obligations of the Company under this Section 6.6
shall survive the satisfaction and discharge of this Indenture and the earlier
resignation or removal of the Trustee.

 

(d)                                 In no event shall the Trustee be liable for any
indirect, special, punitive or consequential loss or damage of any kind
whatsoever, including, but not limited to, lost profits, even if the Trustee
has been advised of the likelihood of such loss or damage and regardless of the
form of action.

 

44

 

(e)                                  In no event shall the Trustee be liable for any failure
or delay in the performance of its obligations hereunder because of
circumstances beyond its control, including, but not limited to, acts of God,
flood, war (whether declared or undeclared), terrorism, fire, riot, embargo,
government action, including any laws, ordinances, regulations, governmental
action or the like which delay, restrict or prohibit the providing of the
services contemplated by this Indenture.

 

SECTION 6.7.
Resignation and Removal; Appointment of Successor.

 

(a)                                  No resignation or removal of the Trustee and no
appointment of a successor Trustee pursuant to this Article VI
shall become effective until the acceptance of appointment by the successor
Trustee under Section 6.8.

 

(b)                                 The Trustee may resign at any time by giving written
notice thereof to the Company.

 

(c)                                  Unless an Event of Default shall have occurred and be
continuing, the Trustee may be removed at any time by the Company by a Board
Resolution. If an Event of Default shall have occurred and be continuing, the
Trustee may be removed by Act of the Holders of a majority in aggregate
principal amount of the Outstanding Securities, delivered to the Trustee and to
the Company.

 

(d)                                 If the Trustee shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of Trustee for
any reason, at a time when no Event of Default shall have occurred and be
continuing, the Company, by a Board Resolution, shall promptly appoint a
successor Trustee, and such successor Trustee and the retiring Trustee shall
comply with the applicable requirements of Section 6.8. If the Trustee shall resign, be removed or become incapable of acting, or
if a vacancy shall occur in the office of Trustee for any reason, at a time
when an Event of Default shall have occurred and be continuing, the Holders, by
Act of the Holders of a majority in aggregate principal amount of the
Outstanding Securities, shall promptly appoint a successor Trustee, and such
successor Trustee and the retiring Trustee shall comply with the applicable
requirements of Section 6.8. If no
successor Trustee shall have been so appointed by the Company or the Holders
and accepted appointment within sixty (60) days after the giving of a notice of
resignation by the Trustee or the removal of the Trustee in the manner required
by Section 6.8, any Holder who has been a bona fide Holder of a
Security for at least six months may, on behalf of such Holder and all others
similarly situated, and any resigning Trustee may, at the expense of the
Company, petition any court of competent jurisdiction for the appointment of a
successor Trustee.

 

(e)                                  The Company shall give notice to all Holders in the
manner provided in Section 1.6 of each resignation and each removal
of the Trustee and each appointment of a successor Trustee. Each notice shall
include the name of the successor Trustee and the address of its Corporate
Trust Office.

 

SECTION 6.8.
Acceptance of Appointment by Successor.

 

(a)                                  In case of the appointment hereunder of a successor
Trustee, each successor Trustee so appointed shall execute, acknowledge and
deliver to the Company and to the retiring Trustee an instrument accepting such
appointment, and thereupon the resignation or removal of

 

45

 

the
retiring Trustee shall become effective and such successor Trustee, without any
further act, deed or conveyance, shall become vested with all the rights,
powers, trusts and duties of the retiring Trustee; but, on the request of the
Company or the successor Trustee, such retiring Trustee shall, upon payment of
its charges, execute and deliver an instrument transferring to such successor
Trustee all the rights, powers and trusts of the retiring Trustee and shall
duly assign, transfer and deliver to such successor Trustee all property and
money held by such retiring Trustee hereunder.

 

(b)                                 Upon request of any such successor Trustee, the Company
shall execute any and all instruments for more fully and certainly vesting in
and confirming to such successor Trustee all rights, powers and trusts referred
to in paragraph (a) of this Section 6.8.

 

(c)                                  No successor Trustee shall accept its appointment
unless at the time of such acceptance such successor Trustee shall be qualified
and eligible under this Article VI.

 

SECTION 6.9. Merger, Conversion,
Consolidation or Succession to Business.

 

Any
Person into which the Trustee may be merged or converted or with which it may
be consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any Person succeeding
to all or substantially all of the corporate trust business of the Trustee,
shall be the successor of the Trustee hereunder, without the execution or
filing of any paper or any further act on the part of any of the parties
hereto, provided, that such Person shall be
otherwise qualified and eligible under this Article VI. In case any Securities shall have been authenticated,
but not delivered, by the Trustee then in office, any successor by merger,
conversion or consolidation or as otherwise provided above in this Section 6.9
to such authenticating Trustee may adopt such authentication and deliver the
Securities so authenticated, and in case any Securities shall not have been
authenticated, any successor to the Trustee may authenticate such Securities
either in the name of any predecessor Trustee or in the name of such successor
Trustee, and in all cases the certificate of authentication shall have the full
force which it is provided anywhere in the Securities or in this Indenture that
the certificate of the Trustee shall have.

 

SECTION 6.10.
Not Responsible for Recitals or Issuance of
Securities.

 

The
recitals contained herein and in the Securities, except the Trustee’s
certificates of authentication, shall be taken as the statements of the
Company, and neither the Trustee nor any Authenticating Agent assumes any
responsibility for their correctness. The Trustee makes no representations as
to the validity or sufficiency of this Indenture or of the Securities. Neither
the Trustee nor any Authenticating Agent shall be accountable for the use or
application by the Company of the Securities or the proceeds thereof.

 

SECTION 6.11.
Appointment of Authenticating Agent.

 

(a)                                  The Trustee may appoint an Authenticating Agent or
Agents with respect to the Securities, which shall be authorized to act on
behalf of the Trustee to authenticate Securities issued upon original issue and
upon exchange, registration of transfer or partial redemption thereof or
pursuant to Section 3.6, and
Securities so authenticated shall be entitled to the benefits of this Indenture
and shall be valid and obligatory for all purposes as if authenticated by the
Trustee hereunder. Wherever reference is made in this Indenture to the
authentication and

 

46

 

delivery
of Securities by the Trustee or the Trustee’s certificate of authentication,
such reference shall be deemed to include authentication and delivery on behalf
of the Trustee by an Authenticating Agent. Each Authenticating Agent shall be
acceptable to the Company and shall at all times be a corporation organized and
doing business under the laws of the United States of America, or of any State
or Territory thereof or the District of Columbia, authorized under such laws to
act as Authenticating Agent, having a combined capital and surplus of not less
than $50,000,000 and subject to supervision or examination by Federal or state
authority. If such Authenticating Agent publishes reports of condition at least
annually pursuant to law or to the requirements of said supervising or
examining authority, then for the purposes of this Section 6.11 the
combined capital and surplus of such Authenticating Agent shall be deemed to be
its combined capital and surplus as set forth in its most recent report of
condition so published. If at any time an Authenticating Agent shall cease to
be eligible in accordance with the provisions of this Section 6.11, such Authenticating Agent shall resign immediately in
the manner and with the effect specified in this Section 6.11.

 

(b)                                 Any Person into which an Authenticating Agent may be
merged or converted or with which it may be consolidated, or any Person
resulting from any merger, conversion or consolidation to which such
Authenticating Agent shall be a party, or any Person succeeding to all or
substantially all of the corporate trust business of an Authenticating Agent
shall be the successor Authenticating Agent hereunder, provided such Person
shall be otherwise eligible under this Section 6.11, without the execution or filing of any paper or any further act on the
part of the Trustee or the Authenticating Agent.

 

(c)                                  An Authenticating Agent may resign at any time by
giving written notice thereof to the Trustee and to the Company. The Trustee
may at any time terminate the agency of an Authenticating Agent by giving
written notice thereof to such Authenticating Agent and to the Company. Upon
receiving such a notice of resignation or upon such a termination, or in case
at any time such Authenticating Agent shall cease to be eligible in accordance
with the provisions of this Section 6.11, the Trustee
may appoint a successor Authenticating Agent eligible under the provisions of
this Section 6.11, which shall be acceptable to the Company, and shall
give notice of such appointment to all Holders. Any successor Authenticating
Agent upon acceptance of its appointment hereunder shall become vested with all
the rights, powers and duties of its predecessor hereunder, with like effect as
if originally named as an Authenticating Agent.

 

(d)                                 The Company agrees to pay to each Authenticating Agent
from time to time reasonable compensation for its services under this Section 6.11
in such amounts as the Company and the Authenticating Agent shall agree from
time to time.

 

(e)                                  If an appointment of an Authenticating Agent is made
pursuant to this Section 6.11, the
Securities may have endorsed thereon, in addition to the Trustee’s certificate
of authentication, an alternative certificate of authentication in the
following form:

 

This is
one of the Securities referred to in the within mentioned Indenture.

 

	
  Dated:

  	
   

  
	
   

  	
   

  
	
   

  	
  JPMORGAN
  CHASE BANK, not in its individual

  capacity, but solely as Trustee

  

 

	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Authenticating
  Agent

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Authorized signatory

  	
   

  

 

47

 

ARTICLE VII

 

HOLDER’S
LISTS AND REPORTS BY COMPANY

 

SECTION 7.1.
Company to Furnish Trustee Names and Addresses of
Holders.

 

The
Company will furnish or cause to be furnished to the Trustee:

 

(a)                                  semiannually, on or before June 30 and December 31
of each year, a list, in such form as the Trustee may reasonably require, of
the names and addresses of the Holders as of a date not more than fifteen (15)
days prior to the delivery thereof, and

 

(b)                                 at such other times as the Trustee may request in
writing, within thirty (30) days after the receipt by the Company of any such
request, a list of similar form and content as of a date not more than fifteen
(15) days prior to the time such list is furnished,

 

in each
case to the extent such information is in the possession or control of the
Company and has not otherwise been received by the Trustee in its capacity as
Securities Registrar.

 

SECTION 7.2.
Preservation of Information, Communications to
Holders.

 

(a)                                  The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders contained in the
most recent list furnished to the Trustee as provided in Section 7.1
and the names and addresses of Holders received by the Trustee in its capacity
as Securities Registrar. The Trustee may destroy any list furnished to it as
provided in Section 7.1 upon receipt of a new list so furnished.

 

(b)                                 The rights of Holders to communicate with other Holders
with respect to their rights under this Indenture or under the Securities, and
the corresponding rights and privileges of the Trustee, shall be as provided in
the Trust Indenture Act.

 

(c)                                  Every Holder of Securities, by receiving and holding
the same, agrees with the Company and the Trustee that neither the Company nor
the Trustee nor any agent of either of them shall be held accountable by reason
of the disclosure of information as to the names and addresses of the Holders
made pursuant to the Trust Indenture Act.

 

48

 

SECTION 7.3. Reports by
Company.

 

(a)                                  The Company shall furnish to the Holders and to
prospective purchasers of Securities, upon their request, the information
required to be furnished pursuant to Rule 144A(d)(4) under the Securities Act.
The Company shall furnish to the Trustee and, so long as the Property Trustee
holds any of the Securities, the Company shall furnish to the Property Trustee,
Statutory Financial Statements promptly following their filing with the
Applicable Insurance Regulatory Authority. The delivery requirement set forth
in the preceding sentence may be satisfied by compliance with Section 7.3(b)
hereof.

 

(b)                                 The Company shall furnish to each of (i) the Trustee,
(ii) the Holders and to subsequent holders of Securities, (iii) Dekania Capital
Management, LLC (at 1818 Market Street, 28th Floor, Philadelphia,
Pennsylvania 19103, or such other address as designated by Dekania Capital
Management, LLC) and (iv) any beneficial owner of the Securities reasonably
identified to the Company (which identification may be made either by such
beneficial owner or by Dekania Capital Management, LLC), a duly completed and
executed certificate substantially and substantively in the form attached
hereto as Exhibit A, including the financial statements referenced in such
Exhibit, which certificate and financial statements shall be so furnished by
the Company not later than forty-five (45) days after the end of each of the
first three fiscal quarters of each fiscal year of the Company and not later
than ninety (90) days after the end of each fiscal year of the Company.

 

(c)                                  If the Company intends to file its annual and quarterly
information with the Securities and Exchange Commission (the “Commission”) in electronic form pursuant to Regulation S-T
of the Commission using the Commission’s Electronic Data Gathering, Analysis
and Retrieval (“EDGAR”) system, the Company
shall notify the Trustee in the manner prescribed herein of each such annual
and quarterly filing. The Trustee is hereby authorized and directed to access
the EDGAR system for purposes of retrieving the financial information so filed.
Compliance with the foregoing shall constitute delivery by the Company of its
financial statements to the Trustee in compliance with the provisions of Section 314(a)
of the Trust Indenture Act, if applicable. The Trustee shall have no duty to
search for or obtain any electronic or other filings that the Company makes
with the Commission, regardless of whether such filings are periodic,
supplemental or otherwise. Delivery of reports, information and documents to
the Trustee pursuant to this Section 7.3(c) shall be solely for
purposes of compliance with this Section 7.3(c) and, if applicable,
with Section 314(a) of the Trust Indenture Act. The Trustee’s receipt of
such reports, information and documents shall not constitute notice to it of
the content thereof or any matter determinable from the content thereof, including
the Company’s compliance with any of its covenants hereunder, as to which the
Trustee is entitled to rely upon Officers’ Certificates.

 

ARTICLE VIII

 

CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

 

SECTION 8.1. Company May Consolidate,
Etc., Only on Certain Terms.

 

The
Company shall not consolidate with or merge into any other Person or convey,
transfer or lease its properties and assets substantially as an entirety to any
Person, and no Person

 

49

 

shall
consolidate with or merge into the Company or convey, transfer or lease its
properties and assets substantially as an entirety to the Company, unless:

 

(a)                                  if the Company shall consolidate with or merge into
another Person or convey, transfer or lease its properties and assets
substantially as an entirety to any Person, the entity formed by such
consolidation or into which the Company is merged or the Person that acquires
by conveyance or transfer, or that leases, the properties and assets of the Company
substantially as an entirety shall be an entity organized and existing under
the laws of the United States of America or any State or Territory thereof or
the District of Columbia and shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form reasonably
satisfactory to the Trustee, the due and punctual payment of the principal of
and any premium and interest (including any Additional Interest) on all the
Securities and the performance of every covenant of this Indenture on the part
of the Company to be performed or observed;

 

(b)                                 immediately after giving effect to such transaction, no
Event of Default, and no event that, after notice or lapse of time, or both,
would constitute an Event of Default, shall have happened and be continuing;
and

 

(c)                                  the Company has delivered to the Trustee an Officers’
Certificate and an Opinion of Counsel, each stating that such consolidation,
merger, conveyance, transfer or lease and, if a supplemental indenture is
required in connection with such transaction, any such supplemental indenture
comply with this Article VIII and that all conditions precedent
herein provided for relating to such transaction have been complied with; and
the Trustee may rely upon such Officers’ Certificate and Opinion of Counsel as
conclusive evidence that such transaction complies with this Section 8.1.

 

SECTION 8.2.
Successor Company Substituted.

 

(a)                                  Upon any consolidation or merger by the Company with or
into any other Person, or any conveyance, transfer or lease by the Company of
its properties and assets substantially as an entirety to any Person in
accordance with Section 8.1 and the execution and delivery to the
Trustee of the supplemental indenture described in Section 8.1(a), the successor entity formed by such consolidation or into which the
Company is merged or to which such conveyance, transfer or lease is made shall
succeed to, and be substituted for, and may exercise every right and power of,
the Company under this Indenture with the same effect as if such successor
Person had been named as the Company herein; and in the event of any such
conveyance or transfer, following the execution and delivery of such
supplemental indenture, the Company shall be discharged from all obligations
and covenants under the Indenture and the Securities.

 

(b)                                 Such successor Person may cause to be executed, and may
issue either in its own name or in the name of the Company, any or all of the
Securities issuable hereunder that theretofore shall not have been signed by
the Company and delivered to the Trustee; and, upon the order of such successor
Person instead of the Company and subject to all the terms, conditions and
limitations in this Indenture prescribed, the Trustee shall authenticate and
shall deliver any Securities that previously shall have been signed and
delivered by the officers of the Company to the Trustee for authentication, and
any Securities that such successor Person thereafter shall cause to be executed
and delivered to the Trustee on its behalf. All the Securities

 

50

 

so issued
shall in all respects have the same legal rank and benefit under this Indenture
as the Securities theretofore or thereafter issued in accordance with the terms
of this Indenture.

 

(c)                                  In case of any such consolidation, merger, sale,
conveyance or lease, such changes in phraseology and form may be made in the
Securities thereafter to be issued as may be appropriate to reflect such
occurrence.

 

ARTICLE IX

 

SUPPLEMENTAL
INDENTURES

 

SECTION 9.1. Supplemental Indentures without Consent of Holders.

 

Without
the consent of any Holders, the Company, when authorized by a Board Resolution,
and the Trustee, at any time and from time to time, may enter into one or more
indentures supplemental hereto, in form reasonably satisfactory to the Trustee,
for any of the following purposes:

 

(a)                                  to evidence the succession of another Person to the
Company, and the assumption by any such successor of the covenants of the
Company herein and in the Securities; or

 

(b)                                 to cure any ambiguity, to correct or supplement any
provision herein that may be defective or inconsistent with any other provision
herein, or to make or amend any other provisions with respect to matters or
questions arising under this Indenture, which shall not be inconsistent with
the other provisions of this Indenture, provided, that
such action pursuant to this clause (b) shall not adversely affect in any
material respect the interests of any Holders or the holders of the Preferred
Securities; or

 

(c)                                  to add to the covenants, restrictions or obligations of
the Company or to add to the Events of Default, provided, that
such action pursuant to this clause (c) shall not adversely affect in any
material respect the interests of any Holders or the holders of the Preferred
Securities; or

 

(d)                                 to modify, eliminate or add to any provisions of the
Indenture or the Securities to such extent as shall be necessary to ensure that
the Securities are treated as indebtedness of the Company for United States
Federal income tax purposes, provided, that
such action pursuant to this clause (d) shall not adversely affect in any
material respect the interests of any Holders or the holders of the Preferred
Securities.

 

SECTION 9.2. Supplemental Indentures with Consent of Holders.

 

(a)                                  With the consent of the Holders of not less than a
majority in aggregate principal amount of the Outstanding Securities, by Act of
said Holders delivered to the Company and the Trustee, the Company, when
authorized by a Board Resolution, and the Trustee may enter into an indenture
or indentures supplemental hereto for the purpose of adding any provisions to
or changing in any manner or eliminating any of the provisions of this
Indenture or of modifying in any manner the rights of the Holders of Securities
under this Indenture; provided, that
no such supplemental indenture shall, without the consent of the Holder of each
Outstanding Security,

 

51

 

(i)
change the Stated Maturity of the principal or any premium of any Security or
change the date of payment of any installment of interest (including any
Additional Interest) on any Security, or reduce the principal amount thereof or
the rate of interest thereon or any premium payable upon the redemption thereof
or change the place of payment where, or the coin or currency in which, any
Security or interest thereon is payable, or restrict or impair the right to
institute suit for the enforcement of any such payment on or after such date, or

 

(ii)
reduce the percentage in aggregate principal amount of the Outstanding
Securities, the consent of whose Holders is required for any such supplemental
indenture, or the consent of whose Holders is required for any waiver of
compliance with any provision of this Indenture or of defaults hereunder and
their consequences provided for in this Indenture, or

 

(iii)
modify any of the provisions of this Section 9.2,  Section 5.13 or Section 10.7.
except to increase any percentage in aggregate principal amount of the
Outstanding Securities, the consent of whose Holders is required for any
reason, or to provide that certain other provisions of this Indenture cannot be
modified or waived without the consent of the Holder of each Security;

 

provided,
further, that, so long as any
Preferred Securities remain outstanding, no amendment under this Section 9.2
shall be effective until the holders of a majority in Liquidation Amount of the
Preferred Securities shall have consented to such amendment; provided, further, that if the consent of the Holder of each
Outstanding Security is required for any amendment under this Indenture, such
amendment shall not be effective until the holder of each Outstanding Preferred
Security shall have consented to such amendment.

 

(b)                                 It shall not be necessary for any Act of Holders under
this Section 9.2 to approve the particular form of any proposed
supplemental indenture, but it shall be sufficient if such Act shall approve
the substance thereof.

 

SECTION 9.3.
Execution of Supplemental Indentures.

 

In
executing or accepting the additional trusts created by any supplemental
indenture permitted by this Article IX or the modifications thereby
of the trusts created by this Indenture, the Trustee shall be entitled to
receive, and shall be fully protected in conclusively relying upon, an Officers’
Certificate and an Opinion of Counsel stating that the execution of such
supplemental indenture is authorized or permitted by this Indenture, and that
all conditions precedent herein provided for relating to such action have been
complied with. The Trustee may, but shall not be obligated to, enter into any
such supplemental indenture that affects the Trustee’s own rights, duties,
indemnities or immunities under this Indenture or otherwise. Copies of the final
form of each supplemental indenture shall be delivered by the Trustee at the
expense of the Company to each Holder, and, if the Trustee is the Property
Trustee, to each holder of Preferred Securities, promptly after the execution
thereof.

 

SECTION 9.4.
Effect of Supplemental Indentures.

 

Upon the
execution of any supplemental indenture under this Article IX, this Indenture shall be modified in accordance
therewith, and such supplemental indenture shall form a part of

 

52

 

this
Indenture for all purposes; and every Holder of Securities and every holder of
Preferred Securities theretofore or thereafter authenticated and delivered
hereunder shall be bound thereby.

 

SECTION 9.5.
Reference in Securities to Supplemental Indentures.

 

Securities
authenticated and delivered after the execution of any supplemental indenture
pursuant to this Article IX may, and shall if required by the
Company, bear a notation in form approved by the Company as to any matter
provided for in such supplemental indenture. If the Company shall so determine,
new Securities so modified as to conform, in the opinion of the Company, to any
such supplemental indenture may be prepared and executed by the Company and
authenticated and delivered by the Trustee in exchange for Outstanding
Securities.

 

ARTICLE X

 

COVENANTS

 

SECTION 10.1.
Payment of Principal, Premium, if any, and Interest.

 

The
Company covenants and agrees for the benefit of the Holders of the Securities
that it will duly and punctually pay the principal of and any premium and
interest (including any Additional Interest) on the Securities in accordance
with the terms of the Securities and this Indenture. As of the date of this
Indenture, the Company represents that it has no present intention to exercise
its right under Section 2.11 to defer payments of interest on the
Securities.

 

SECTION 10.2.
Money for Security Payments to be Held in Trust.

 

(a)                                  If the Company shall at any time act as its own Paying
Agent with respect to the Securities, it will, on or before each due date of
the principal of and any premium or interest (including any Additional
Interest) on the Securities, segregate and hold in trust for the benefit of the
Persons entitled thereto a sum sufficient to pay the principal and any premium
or interest (including Additional Interest) so becoming due until such sums
shall be paid to such Persons or otherwise disposed of as herein provided, and
will promptly notify the Trustee in writing of its failure so to act.

 

(b)                                 Whenever the Company shall have one or more Paying
Agents, it will, prior to 10:00 a.m., New York City time, on each due date of
the principal of or any premium or interest (including any Additional Interest)
on any Securities, deposit with a Paying Agent a sum sufficient to pay such
amount, such sum to be held as provided in the Trust Indenture Act and (unless
such Paying Agent is the Trustee) the Company will promptly notify the Trustee
of its failure so to act.

 

(c)                                  The Company will cause each Paying Agent for the
Securities other than the Trustee to execute and deliver to the Trustee an
instrument in which such Paying Agent shall agree with the Trustee, subject to
the provisions of this Section 10.2, that such
Paying Agent will (i) comply with the provisions of this Indenture and the
Trust Indenture Act applicable to it as a Paying Agent and (ii) during the
continuance of any default by the Company (or any other obligor upon the
Securities) in the making of any payment in respect of the Securities, upon the
written request of the Trustee, forthwith pay to the Trustee all sums held in
trust by such Paying Agent for payment in respect of the Securities.

 

53

 

(d)                                 The Company may at any time, for the purpose of
obtaining the satisfaction and discharge of this Indenture or for any other
purpose, pay, or by Company Order direct any Paying Agent to pay, to the
Trustee all sums held in trust by the Company or such Paying Agent, such sums
to be held by the Trustee upon the same trusts as those upon which such sums
were held by the Company or such Paying Agent; and, upon such payment by any
Paying Agent to the Trustee, such Paying Agent shall be released from all
further liability with respect to such money.

 

(e)                                  Any money deposited with the Trustee or any Paying
Agent, or then held by the Company in trust for the payment of the principal of
and any premium or interest (including any Additional Interest) on any Security
and remaining unclaimed for two years after such principal and any premium or
interest has become due and payable shall (unless otherwise required by
mandatory provision of applicable escheat or abandoned or unclaimed property
law) be paid on Company Request to the Company, or (if then held by the
Company) shall (unless otherwise required by mandatory provision of applicable
escheat or abandoned or unclaimed property law) be discharged from such trust;
and the Holder of such Security shall thereafter, as an unsecured general
creditor, look only to the Company for payment thereof, and all liability of
the Trustee or such Paying Agent with respect to such trust money, and all
liability of the Company as trustee thereof, shall thereupon cease; provided, that the Trustee or such Paying Agent, before
being required to make any such repayment, may at the expense of the Company
cause to be published once, in a newspaper published in the English language,
customarily published on each Business Day and of general circulation in the
Borough of Manhattan, The City of New York, notice that such money remains
unclaimed and that, after a date specified therein, which shall not be less
than thirty (30) days from the date of such publication, any unclaimed balance
of such money then remaining will be repaid to the Company.

 

SECTION 10.3.
Statement as to Compliance.

 

The
Company shall deliver to the Trustee, within one hundred and twenty (120) days
after the end of each fiscal year of the Company ending after the date hereof,
an Officers’ Certificate covering the preceding calendar year, stating whether
or not to the knowledge of the signers thereof the Company is in default in the
performance or observance of any of the terms, provisions and conditions of
this Indenture (without regard to any period of grace or requirement of notice provided
hereunder), and if the Company shall be in default, specifying all such
defaults and the nature and status thereof of which they may have knowledge.

 

SECTION 10.4.
Calculation Agent.

 

(a)                                  The Company hereby agrees that for so long as any of
the Securities remain Outstanding, there will at all times be an agent
appointed to calculate LIBOR in respect of each Interest
Payment Date in accordance with the terms of Schedule A (the “Calculation Agent”). The Company has initially appointed
the Property Trustee as Calculation Agent for purposes of determining LIBOR for
each Interest Payment Date. The Calculation Agent may be removed by the Company
at any time. So long as the Property Trustee holds any of the Securities, the
Calculation Agent shall be the Property Trustee, except as described in the
immediately preceding sentence. If the Calculation Agent is unable or unwilling
to act as such or is removed by the Company, the Company will promptly appoint
as a replacement Calculation Agent the London office of a leading bank which is
engaged in transactions in Eurodollar deposits in the

 

54

 

international
Eurodollar market and which does not control or is not controlled by or under
common control with the Company or its Affiliates. The Calculation Agent may
not resign its duties without a successor having been duly appointed.

 

(b)                                 The Calculation Agent shall be required to agree that,
as soon as possible after 11:00 a.m. (London time) on each LIBOR Determination
Date (as defined in Schedule A), but in no event later than 11:00
a.m. (London time) on the Business Day immediately following each LIBOR
Determination Date, the Calculation Agent will calculate the interest rate (the
Interest Payment shall be rounded to the nearest cent, with half a cent being
rounded upwards) for the related Interest Payment Date, and will communicate
such rate and amount to the Company, the Trustee, each Paying Agent and the
Depositary. The Calculation Agent will also specify to the Company the
quotations upon which the foregoing rates and amounts are based and, in any
event, the Calculation Agent shall notify the Company before 5:00 p.m. (London
time) on each LIBOR Determination Date that either: (i) it has determined or is
in the process of determining the foregoing rates and amounts or (ii) it has
not determined and is not in the process of determining the foregoing rates and
amounts, together with its reasons therefor. The Calculation Agent’s
determination of the foregoing rates and amounts for any Interest Payment Date
will (in the absence of manifest error) be final and binding upon all parties.
For the sole purpose of calculating the interest rate for the Securities, “Business
Day” shall be defined as any day on which dealings in deposits in Dollars are
transacted in the London interbank market.

 

SECTION 10.5.
Additional Tax Sums.

 

So long
as no Event of Default has occurred and is continuing, if (a) the Trust is the
Holder of all of the Outstanding Securities and (b) a Tax Event described in
clause (i) or (iii) in the definition of Tax Event in Section 1.1
hereof has occurred and is continuing, the Company shall pay to the Trust (and
its permitted successors or assigns under the related Trust Agreement) for so
long as the Trust (or its permitted successor or assignee) is the registered
holder of the Outstanding Securities, such amounts as may be necessary in order
that the amount of Distributions (including any Additional Interest Amount (as
defined in the Trust Agreement)) then due and payable by the Trust on the
Preferred Securities and Common Securities that at any time remain outstanding
in accordance with the terms thereof shall not be reduced as a result of any
Additional Taxes arising from such Tax Event (additional such amounts payable
by the Company to the Trust, the “Additional Tax Sums”). Whenever
in this Indenture or the Securities there is a reference in any context to the
payment of principal of or interest on the Securities, such mention shall be
deemed to include mention of the payments of the Additional Tax Sums provided
for in this Section 10.5 to the extent that, in such context,
Additional Tax Sums are, were or would be payable in respect thereof pursuant
to the provisions of this Section 10.5 and express mention of the payment
of Additional Tax Sums (if applicable) in any provisions hereof shall not be
construed as excluding Additional Tax Sums in those provisions hereof where
such express mention is not made; provided, that
the deferral of the payment of interest pursuant to Section 3.9 on
the Securities shall not defer the payment of any Additional Tax Sums that may
be due and payable.

 

SECTION 10.6.
Additional Covenants.

 

(a)                                  The Company covenants and agrees with each Holder of
Securities that if an Event of Default shall have occurred and be continuing or
the Company shall have given notice

 

55

 

of its
election to begin an Extension Period with respect to the Securities or such
Extension Period, or any extension thereof, shall be continuing, it shall not
(i) declare or pay any dividends or distributions on, or redeem, purchase,
acquire or make a liquidation payment with respect to, any shares of the
Company’s capital stock, or (ii) make any payment of principal of or any interest
or premium, if any, on or repay, repurchase or redeem any debt securities of
the Company that rank pari passu in
all respects with or junior in interest to the Securities (other than (A)
repurchases, redemptions or other acquisitions of shares of capital stock of
the Company in connection with any employment contract, benefit plan or other
similar arrangement with or for the benefit of any one or more employees,
officers, directors or consultants, in connection with a dividend reinvestment
or stockholder stock purchase plan or in connection with the issuance of
capital stock of the Company (or securities convertible into or exercisable for
such capital stock) as consideration in an acquisition transaction entered into
prior to the applicable Extension Period, (B) as a result of an exchange or
conversion of any class or series of the Company’s capital stock (or any
capital stock of a Subsidiary of the Company) for any class or series of the
Company’s capital stock or of any class or series of the Company’s indebtedness
for any class or series of the Company’s capital stock, (C) the purchase of
fractional interests in shares of the Company’s capital stock pursuant to the
conversion or exchange provisions of such capital stock or the security being
converted or exchanged, (D) any declaration of a dividend in connection with
any Rights Plan, the issuance of rights, stock or other property under any
Rights Plan or the redemption or repurchase of rights pursuant thereto or (E)
any dividend in the form of stock, warrants, options or other rights where the
dividend stock or the stock issuable upon exercise of such warrants, options or
other rights is the same stock as that on which the dividend is being paid or
ranks pari passu with or junior to such
stock).

 

(b)                                 The Company also covenants with each Holder of
Securities (i) to hold, directly or indirectly, one hundred percent (100%) of
the Common Securities of the Trust, provided, that
any permitted successor of the Company hereunder may succeed to the Company’s ownership
of such Common Securities, (ii) as holder of such Common Securities, not to
voluntarily dissolve, wind-up or liquidate the Trust other than (A) in
connection with a distribution of the Securities to the holders of the
Preferred Securities in liquidation of the Trust or (B) in connection with
certain mergers, consolidations or amalgamations permitted by the Trust
Agreement and (iii) to use its reasonable commercial efforts, consistent with
the terms and provisions of the Trust Agreement, to cause the Trust to continue
to be taxable as a grantor trust and not as a corporation for United States
Federal income tax purposes.

 

SECTION 10.7.
Waiver of Covenants.

 

The
Company may omit in any particular instance to comply with any covenant or
condition contained in Section 10.6 if, before or after the time
for such compliance, the Holders of at least a majority in aggregate principal
amount of the Outstanding Securities shall, by Act of such Holders, and at
least a majority of the aggregate Liquidation Amount of the Preferred
Securities then outstanding, by consent of such holders, either waive such
compliance in such instance or generally waive compliance with such covenant or
condition, but no such waiver shall extend to or affect such covenant or
condition except to the extent so expressly waived, and, until such waiver
shall become effective, the obligations of the Company in respect of any such
covenant or condition shall remain in full force and effect.

 

56

 

SECTION 10.8.
Treatment of Securities.

 

The
Company will treat the Securities as indebtedness, and the amounts, other than
payments of principal, payable in respect of the principal amount of such
Securities as interest, for all U.S. federal income tax purposes. All payments
in respect of the Securities will be made free and clear of U.S. withholding
tax to any beneficial owner thereof that has provided an Internal Revenue
Service Form W-9 or W-8BEN (or any substitute or successor form) establishing
its U.S. or non-U.S. status for U.S. federal income tax purposes, or any other
applicable form establishing a complete exemption from U.S. withholding tax.

 

ARTICLE XI

 

REDEMPTION
OF SECURITIES

 

SECTION 11.1. Optional Redemption.

 

The
Company may, at its option, on any Interest Payment Date, on or after April 29,
2009, redeem the Securities in whole at any time or in part from time to time,
at a Redemption Price equal to one hundred percent (100%) of the principal
amount thereof (or of the redeemed portion thereof, as applicable), together,
in the case of any such redemption, with accrued interest, including any
Additional Interest, through but excluding the date fixed as the Redemption
Date (the “Optional Redemption Price”); provided, that
the Company shall have received the prior approval of any Applicable Insurance
Regulatory Authorities with respect to such redemption if then required.

 

SECTION 11.2.
Special Event Redemption.

 

Prior to April 29,
2009, upon the occurrence and during the continuation of a Special Event, the
Company may, at its option, redeem the Securities, in whole but not in part, at
a Redemption Price equal to one hundred seven and one half percent (107.5%) of
the principal amount thereof, together, in the case of any such redemption,
with accrued interest, including any Additional Interest, through but excluding
the date fixed as the Redemption Date (the “Special Redemption Price”), provided, that the Company shall have received the prior
approval of any Applicable Insurance Regulatory Authority with respect to such
redemption if then required.

 

SECTION 11.3. Election to Redeem; Notice to Trustee.

 

The
election of the Company to redeem any Securities, in whole or in part, shall be
evidenced by or pursuant to a Board Resolution. In case of any redemption at
the election of the Company, the Company shall, not less than forty-five (45)
days and not more than seventy-five (75) days prior to the Redemption Date
(unless a shorter notice shall be satisfactory to the Trustee), notify the
Trustee and the Property Trustee under the Trust Agreement in writing of such
date and of the principal amount of the Securities to be redeemed and provide
the additional information required to be included in the notice or notices
contemplated by Section 11.5. In the
case of any redemption of Securities, in whole or in part, (a) prior to the
expiration of any restriction on such redemption provided in this Indenture or
the Securities or (b) pursuant to an election of the Company which is subject
to a condition specified in this Indenture or the

 

57

 

Securities,
the Company shall furnish the Trustee with an Officers’ Certificate and an
Opinion of Counsel evidencing compliance with such restriction or condition.

 

SECTION 11.4.
Selection of Securities to be Redeemed.

 

(a)                                  If less than all the Securities are to be redeemed, the
particular Securities to be redeemed shall be selected and redeemed on a pro
rata basis not more than sixty (60) days prior to the Redemption Date by the Trustee
from the Outstanding Securities not previously called for redemption, provided, that the unredeemed portion of the principal
amount of any Security shall be in an authorized denomination (which shall not
be less than the minimum authorized denomination) for such Security.

 

(b)                                 The Trustee shall promptly notify the Company in
writing of the Securities selected for redemption and, in the case of any
Securities selected for partial redemption, the principal amount thereof to be
redeemed. For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Securities shall relate,
in the case of any Security redeemed or to be redeemed only in part, to the
portion of the principal amount of such Security that has been or is to be
redeemed.

 

(c)                                  The provisions of paragraphs (a) and (b) of this Section 11.4
shall not apply with respect to any redemption affecting only a single
Security, whether such Security is to be redeemed in whole or in part. In the
case of any such redemption in part, the unredeemed portion of the principal
amount of the Security shall be in an authorized denomination (which shall not
be less than the minimum authorized denomination) for such Security.

 

SECTION 11.5.
Notice of Redemption.

 

(a)                                  Notice of redemption shall be given not later than the
thirtieth (30th) day, and not earlier than the sixtieth (60th)
day, prior to the Redemption Date to each Holder of Securities to be redeemed,
in whole or in part, (unless a shorter notice shall be satisfactory to the
Property Trustee under the related Trust Agreement).

 

(b)                                 With respect to Securities to be redeemed, in whole or
in part, each notice of redemption shall state:

 

(i)
the Redemption Date;

 

(ii)
the Redemption Price or, if the Redemption Price cannot be calculated prior to
the time the notice is required to be sent, the estimate of the Redemption
Price, as calculated by the Company, together with a statement that it is an
estimate and that the actual Redemption Price will be calculated on the fifth
Business Day prior to the Redemption Date (and if an estimate is provided, a
further notice shall be sent of the actual Redemption Price on the date that
such Redemption Price is calculated);

 

(iii)
if less than all Outstanding Securities are to be redeemed, the identification
(and, in the case of partial redemption, the respective principal amounts) of
the particular Securities to be redeemed;

 

58

 

(iv)
that on the Redemption Date, the Redemption Price will become due and payable
upon each such Security or portion thereof, and that any interest (including
any Additional Interest) on such Security or such portion, as the case may be,
shall cease to accrue on and after said date; and

 

(v)
the place or places where such Securities are to be surrendered for payment of
the Redemption Price.

 

(c)                                  Notice of redemption of Securities to be redeemed, in
whole or in part, at the election of the Company shall be given by the Company
or, at the Company’s request, by the Trustee in the name and at the expense of
the Company and shall be irrevocable. The notice if mailed in the manner
provided above shall be conclusively presumed to have been duly given, whether
or not the Holder receives such notice. In any case, a failure to give such
notice by mail or any defect in the notice to the Holder of any Security
designated for redemption as a whole or in part shall not affect the validity
of the proceedings for the redemption of any other Security.

 

SECTION 11.6.
Deposit of Redemption Price.

 

Prior to
10:00 a.m., New York City time, on the Redemption Date specified in the notice
of redemption given as provided in Section 11.5, the Company will deposit with the Trustee or with one
or more Paying Agents (or if the Company is acting as its own Paying Agent, the
Company will segregate and hold in trust as provided in Section 10.2) an amount of money sufficient to pay the Redemption Price of, and any
accrued interest (including any Additional Interest) on, all the Securities (or
portions thereof) that are to be redeemed on that date.

 

SECTION 11.7. Payment of Securities Called for Redemption.

 

(a)                                  If any notice of redemption has been given as provided
in Section 11.5, the Securities or portion of Securities with respect
to which such notice has been given shall become due and payable on the date
and at the place or places stated in such notice at the applicable Redemption
Price, together with accrued interest (including any Additional Interest) to
the Redemption Date. On presentation and surrender of such Securities at a
Place of Payment specified in such notice, the Securities or the specified
portions thereof shall be paid and redeemed by the Company at the applicable
Redemption Price, together with accrued interest (including any Additional
Interest) to the Redemption Date.

 

(b)                                 Upon presentation of any Security redeemed in part
only, the Company shall execute and the Trustee shall authenticate and deliver
to the Holder thereof, at the expense of the Company, a new Security or
Securities, of authorized denominations, in aggregate principal amount equal to
the unredeemed portion of the Security so presented and having the same
Original Issue Date, Stated Maturity and terms.

 

(c)                                  If any Security called for redemption shall not be so
paid upon surrender thereof for redemption, the principal of and any premium on
such Security shall, until paid, bear interest from the Redemption Date at the
rate prescribed therefor in the Security.

 

59

 

ARTICLE XII

 

SUBORDINATION
OF SECURITIES

 

SECTION 12.1. Securities Subordinate to Senior Debt.

 

The
Company covenants and agrees, and each Holder of a Security, by its acceptance
thereof, likewise covenants and agrees, that, to the extent and in the manner
hereinafter set forth in this Article XII, the
payment of the principal of and any premium and interest (including any
Additional Interest) on each and all of the Securities are hereby expressly
made subordinate and subject in right of payment to the prior payment in full
of all Senior Debt.

 

SECTION 12.2. No Payment When Senior Debt in Default; Payment Over of Proceeds Upon
Dissolution, Etc.

 

(a)                                  In the event and during the continuation of any default
by the Company in the payment of any principal of or any premium or interest on
any Senior Debt (following any grace period, if applicable) when the same
becomes due and payable, whether at maturity or at a date fixed for prepayment
or by declaration of acceleration or otherwise, then, upon written notice of
such default to the Company by the holders of such Senior Debt or any trustee
therefor, unless and until such default shall have been cured or waived or
shall have ceased to exist, no direct or indirect payment (in cash, property,
securities, by set-off or otherwise) shall be made or agreed to be made on
account of the principal of or any premium or interest (including any
Additional Interest) on any of the Securities, or in respect of any redemption,
repayment, retirement, purchase or other acquisition of any of the Securities.

 

(b)                                 In the event of a bankruptcy, insolvency or other
proceeding described in clause (d) or (e) of the definition of Event of Default
(each such event, if any, herein sometimes referred to as a “Proceeding”),
all Senior Debt (including any interest thereon accruing after the
commencement of any such proceedings) shall first be paid in full before any
payment or distribution, whether in cash, securities or other property, shall
be made to any Holder of any of the Securities on account thereof. Any payment
or distribution, whether in cash, securities or other property (other than
securities of the Company or any other entity provided for by a plan of
reorganization or readjustment the payment of which is subordinate, at least to
the extent provided in these subordination provisions with respect to the
indebtedness evidenced by the Securities, to the payment of all Senior Debt at
the time outstanding and to any securities issued in respect thereof under any
such plan of reorganization or readjustment), which would otherwise (but for
these subordination provisions) be payable or deliverable in respect of the
Securities shall be paid or delivered directly to the holders of Senior Debt in
accordance with the priorities then existing among such holders until all
Senior Debt (including any interest thereon accruing after the commencement of
any Proceeding) shall have been paid in full.

 

(c)                                  In the event of any Proceeding, after payment in full
of all sums owing with respect to Senior Debt, the Holders of the Securities,
together with the holders of any obligations of the Company ranking on a parity
with the Securities, shall be entitled to be paid from the remaining assets of
the Company the amounts at the time due and owing on account of unpaid
principal of and any premium and interest (including any Additional Interest)
on the Securities and such other obligations before any payment or other
distribution, whether in cash, property or

 

60

 

otherwise,
shall be made on account of any capital stock or any obligations of the Company
ranking junior to the Securities and such other obligations. If,
notwithstanding the foregoing, any payment or distribution of any character or
any security, whether in cash, securities or other property (other than
securities of the Company or any other entity provided for by a plan of
reorganization or readjustment the payment of which is subordinate, at least to
the extent provided in these subordination provisions with respect to the
indebtedness evidenced by the Securities, to the payment of all Senior Debt at
the time outstanding and to any securities issued in respect thereof under any
such plan of reorganization or readjustment) shall be received by the Trustee
or any Holder in contravention of any of the terms hereof and before all Senior
Debt shall have been paid in full, such payment or distribution or security
shall be received in trust for the benefit of, and shall be paid over or
delivered and transferred to, the holders of the Senior Debt at the time
outstanding in accordance with the priorities then existing among such holders
for application to the payment of all Senior Debt remaining unpaid, to the
extent necessary to pay all such Senior Debt (including any interest thereon
accruing after the commencement of any Proceeding) in full. In the event of the
failure of the Trustee or any Holder to endorse or assign any such payment,
distribution or security, each holder of Senior Debt is hereby irrevocably
authorized to endorse or assign the same.

 

(d)                                 The Trustee and the Holders, at the expense of the
Company, shall take such reasonable action (including the delivery of this
Indenture to an agent for any holders of Senior Debt or consent to the filing
of a financing statement with respect hereto) as may, in the opinion of counsel
designated by the holders of a majority in principal amount of the Senior Debt
at the time outstanding, be necessary or appropriate to assure the
effectiveness of the subordination effected by these provisions.

 

(e)                                  The provisions of this Section 12.2 shall
not impair any rights, interests, remedies or powers of any secured creditor of
the Company in respect of any security interest the creation of which is not
prohibited by the provisions of this Indenture.

 

(f)                                    The securing of any obligations of the Company,
otherwise ranking on a parity with the Securities or ranking junior to the
Securities, shall not be deemed to prevent such obligations from constituting,
respectively, obligations ranking on a parity with the Securities or ranking
junior to the Securities.

 

SECTION 12.3.
Payment Permitted If No Default.

 

Nothing
contained in this Article XII, or
elsewhere in this Indenture or in any of the Securities shall prevent (a) the
Company, at any time, except during the pendency of the conditions described in
paragraph (a) of Section 12.2 or of any Proceeding referred to in Section 12.2, from making payments at any time of principal of and any premium or
interest (including any Additional Interest) on the Securities or (b) the
application by the Trustee of any moneys deposited with it hereunder to the
payment of or on account of the principal of and any premium or interest
(including any Additional Interest) on the Securities or the retention of such
payment by the Holders, if, at the time of such application by the Trustee, it
did not have knowledge (in accordance with Section 12.8) that such payment would have been prohibited by the provisions of this Article XII, except as provided in Section 12.8.

 

61

 

SECTION 12.4.
Subrogation to Rights of Holders of Senior Debt.

 

Subject
to the payment in full of all amounts due or to become due on all Senior Debt,
or the provision for such payment in cash or cash equivalents or otherwise in a
manner satisfactory to the holders of Senior Debt, the Holders of the
Securities shall be subrogated to the extent of the payments or distributions
made to the holders of such Senior Debt pursuant to the provisions of this Article XII
(equally and ratably with the holders of all indebtedness of the Company that
by its express terms is subordinated to Senior Debt of the Company to
substantially the same extent as the Securities are subordinated to the Senior
Debt and is entitled to like rights of subrogation by reason of any payments or
distributions made to holders of such Senior Debt) to the rights of the holders
of such Senior Debt to receive payments and distributions of cash, property and
securities applicable to the Senior Debt until the principal of and any premium
and interest (including any Additional Interest) on the Securities shall be
paid in full. For purposes of such subrogation, no payments or distributions to
the holders of the Senior Debt of any cash, property or securities to which the
Holders of the Securities or the Trustee would be entitled except for the
provisions of this Article XII, and no
payments made pursuant to the provisions of this Article XII to the
holders of Senior Debt by Holders of the Securities or the Trustee, shall, as
among the Company, its creditors other than holders of Senior Debt, and the
Holders of the Securities, be deemed to be a payment or distribution by the
Company to or on account of the Senior Debt.

 

SECTION 12.5.
Provisions Solely to Define Relative Rights.

 

The
provisions of this Article XII are and are intended solely for the
purpose of defining the relative rights of the Holders of the Securities on the
one hand and the holders of Senior Debt on the other hand. Nothing contained in
this Article XII or elsewhere in this Indenture or in the
Securities is intended to or shall (a) impair, as between the Company and the
Holders of the Securities, the obligations of the Company, which are absolute
and unconditional, to pay to the Holders of the Securities the principal of and
any premium and interest (including any Additional Interest) on the Securities
as and when the same shall become due and payable in accordance with their
terms, (b) affect the relative rights against the Company of the Holders of the
Securities and creditors of the Company other than their rights in relation to
the holders of Senior Debt or (c) prevent the Trustee or the Holder of any
Security (or to the extent expressly provided herein, the holder of any
Preferred Security) from exercising all remedies otherwise permitted by
applicable law upon default under this Indenture, including filing and voting
claims in any Proceeding, subject to the rights, if any, under this Article XII
of the holders of Senior Debt to receive cash, property and securities
otherwise payable or deliverable to the Trustee or such Holder.

 

SECTION 12.6.
Trustee to Effectuate Subordination.

 

Each
Holder of a Security by his or her acceptance thereof authorizes and directs
the Trustee on his or her behalf to take such action as may be necessary or
appropriate to acknowledge or effectuate the subordination provided in this Article XII
and appoints the Trustee his or her attorney-in-fact for any and all such
purposes.

 

62

 

SECTION 12.7.
No Waiver of Subordination Provisions.

 

(a)                                  No right of any present or future holder of any Senior
Debt to enforce subordination as herein provided shall at any time in any way
be prejudiced or impaired by any act or failure to act on the part of the
Company or by any act or failure to act, in good faith, by any such holder, or
by any noncompliance by the Company with the terms, provisions and covenants of
this Indenture, regardless of any knowledge thereof that any such holder may
have or be otherwise charged with.

 

(b)                                 Without in any way limiting the generality of paragraph
(a) of this Section 12.7, the holders
of Senior Debt may, at any time and from to time, without the consent of or
notice to the Trustee or the Holders of the Securities, without incurring
responsibility to such Holders of the Securities and without impairing or
releasing the subordination provided in this Article XII or the
obligations hereunder of such Holders of the Securities to the holders of Senior
Debt, do any one or more of the following: (i) change the manner, place or
terms of payment or extend the time of payment of, or renew or alter, Senior
Debt, or otherwise amend or supplement in any manner Senior Debt or any
instrument evidencing the same or any agreement under which Senior Debt is
outstanding, (ii) sell, exchange, release or otherwise deal with any property
pledged, mortgaged or otherwise securing Senior Debt, (iii) release any Person
liable in any manner for the payment of Senior Debt and (iv) exercise or
refrain from exercising any rights against the Company and any other Person.

 

SECTION 12.8. Notice to Trustee.

 

(a)                                  The Company shall give prompt written notice to a
Responsible Officer of the Trustee of any fact known to the Company that would
prohibit the making of any payment to or by the Trustee in respect of the
Securities. Notwithstanding the provisions of this Article XII or
any other provision of this Indenture, the Trustee shall not be charged with
knowledge of the existence of any facts that would prohibit the making of any
payment to or by the Trustee in respect of the Securities, unless and until a
Responsible Officer of the Trustee shall have received written notice thereof
from the Company or a holder of Senior Debt or from any trustee, agent or
representative therefor; provided, that
if the Trustee shall not have received the notice provided for in this Section 12.8
at least two Business Days prior to the date upon which by the terms hereof any
monies may become payable for any purpose (including, the payment of the
principal of and any premium on or interest (including any Additional Interest)
on any Security), then, anything herein contained to the contrary
notwithstanding, the Trustee shall have full power and authority to receive
such monies and to apply the same to the purpose for which they were received
and shall not be affected by any notice to the contrary that may be received by
it within two Business Days prior to such date.

 

(b)                                 The Trustee shall be entitled to rely on the delivery
to it of a written notice by a Person representing himself or herself to be a
holder of Senior Debt (or a trustee, agent, representative or attorney-in-fact
therefor) to establish that such notice has been given by a holder of Senior Debt
(or a trustee, agent, representative or attorney-in-fact therefor). In the
event that the Trustee determines in good faith that further evidence is
required with respect to the right of any Person as a holder of Senior Debt to
participate in any payment or distribution pursuant to this Article XII, the Trustee may request such Person to furnish evidence to the reasonable
satisfaction of the Trustee as to the amount of Senior Debt held by such
Person, the

 

63

 

extent to
which such Person is entitled to participate in such payment or distribution
and any other facts pertinent to the rights of such Person under this Article XII, and if such evidence is not furnished, the Trustee may
defer any payment to such Person pending judicial determination as to the right
of such Person to receive such payment.

 

SECTION 12.9.
Reliance on Judicial Order or Certificate of
Liquidating Agent.

 

Upon any
payment or distribution of assets of the Company referred to in this Article XII, the Trustee and the Holders of the Securities shall be
entitled to conclusively rely upon any order or decree entered by any court of
competent jurisdiction in which such Proceeding is pending, or a certificate of
the trustee in bankruptcy, receiver, liquidating trustee, custodian, assignee
for the benefit of creditors, agent or other Person making such payment or
distribution, delivered to the Trustee or to the Holders of Securities, for the
purpose of ascertaining the Persons entitled to participate in such payment or
distribution, the holders of the Senior Debt and other indebtedness of the
Company, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article XII.

 

SECTION 12.10.
Trustee Not Fiduciary for Holders of Senior Debt.

 

The
Trustee, in its capacity as trustee under this Indenture, shall not be deemed
to owe any fiduciary duty to the holders of Senior Debt and shall not be liable
to any such holders if it shall in good faith mistakenly pay over or distribute
to Holders of Securities or to the Company or to any other Person cash,
property or securities to which any holders of Senior Debt shall be entitled by
virtue of this Article XII or otherwise.

 

SECTION 12.11.
Rights of Trustee as Holder of Senior Debt;
Preservation of Trustee’s Rights.

 

The
Trustee in its individual capacity shall be entitled to all the rights set
forth in this Article XII with respect to any Senior Debt that may
at any time be held by it, to the same extent as any other holder of Senior
Debt, and nothing in this Indenture shall deprive the Trustee of any of its
rights as such holder.

 

SECTION 12.12.
Article Applicable to Paying Agents.

 

If at any
time any Paying Agent other than the Trustee shall have been appointed by the
Company and be then acting hereunder, the term “Trustee” as
used in this Article XII shall in such case (unless the context
otherwise requires) be construed as extending to and including such Paying
Agent within its meaning as fully for all intents and purposes as if such
Paying Agent were named in this Article XII in addition to or in
place of the Trustee; provided, that Sections
12.8 and 12.11 shall not apply to the Company or any Affiliate of
the Company if the Company or such Affiliate acts as Paying Agent.

 

* * * *

 

This
instrument may be executed in any number of counterparts, each of which so
executed shall be deemed to be an original, but all such counterparts shall
together constitute but one and the same instrument.

 

64

 

IN
WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly
executed as of the day and year first above written.

 

	
   

  	
  AMERICAN
  EQUITY INVESTMENT LIFE

  HOLDING COMPANY

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Debra J. Richardson

  	
   

  
	
   

  	
   

  	
  Name: Debra
  J. Richardson

  
	
   

  	
   

  	
  Title:
  Secretary & Senior Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
  JPMORGAN
  CHASE BANK, as Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Maria D. Calzado

  	
   

  
	
   

  	
   

  	
  Name:
  Maria D. Calzado

  
	
   

  	
   

  	
  Title:
  Vice President

  
					

 

 

Junior Subordinated IndentureExhibit 4.14

 

GUARANTEE
AGREEMENT

 

between

 

AMERICAN EQUITY
INVESTMENT LIFE HOLDING COMPANY,

as Guarantor,

 

 

and

 

 

JPMORGAN CHASE
BANK,

as Guarantee
Trustee

 

 

Dated as
of April 29, 2004

 

 

AMERICAN EQUITY
CAPITAL TRUST III

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  
	
  ARTICLE I

  	
  Interpretation and Definitions

  	
   

  
	
  Section 1.1.

  	
  Interpretation

  	
   

  
	
  Section 1.2.

  	
  Definitions

  	
   

  
	
  ARTICLE II

  	
  Reports

  	
   

  
	
  Section 2.1.

  	
  List of Holders

  	
   

  
	
  Section
  2.2.

  	
  Periodic
  Reports to the Guarantee Trustee

  	
   

  
	
  Section 2.3.

  	
  Event of
  Default; Waiver

  	
   

  
	
  Section 2.4.

  	
  Event of
  Default; Notice

  	
   

  
	
  ARTICLE III

  	
  Powers, Duties and Rights of the Guarantee
  Trustee

  	
   

  
	
  Section
  3.1.

  	
  Powers
  and Duties of the Guarantee Trustee

  	
   

  
	
  Section
  3.2.

  	
  Certain
  Rights of the Guarantee Trustee

  	
   

  
	
  Section 3.3.

  	
  Compensation

  	
   

  
	
  Section 3.4.

  	
  Indemnity

  	
   

  
	
  Section 3.5.

  	
  Securities

  	
   

  
	
  ARTICLE IV

  	
  Guarantee Trustee

  	
   

  
	
  Section
  4.1.

  	
  Guarantee
  Trustee; Eligibility

  	
   

  
	
  Section 4.2.

  	
  Appointment, Removal and Resignation of
  the Guarantee Trustee

  	
   

  
	
  ARTICLE V

  	
  Guarantee

  	
   

  
	
  Section 5.1.

  	
  Guarantee

  	
   

  
	
  Section 5.2.

  	
  Waiver of
  Notice and Demand

  	
   

  
	
  Section 5.3.

  	
  Obligations Not
  Affected

  	
   

  
	
  Section 5.4.

  	
  Rights of Holders

  	
   

  
	
  Section 5.5.

  	
  Guarantee of Payment

  	
   

  
	
  Section 5.6.

  	
  Subrogation

  	
   

  
	
  Section 5.7.

  	
  Independent
  Obligations

  	
   

  
	
  Section 5.8.

  	
  Enforcement

  	
   

  
	
  ARTICLE VI

  	
  Covenants and Subordination

  	
   

  
	
  Section 6.1.

  	
  Dividends, Distributions and Payments

  	
   

  
	
  Section 6.2.

  	
  Subordination

  	
   

  
	
  Section 6.3.

  	
  Pari Passu
  Guarantees

  	
   

  
					

 

i

 

	
  ARTICLE VII

  	
  Termination

  	
   

  
	
  Section 7.1.

  	
  Termination

  	
   

  
	
  ARTICLE VIII

  	
  Miscellaneous

  	
   

  
	
  Section 8.1.

  	
  Successors and
  Assigns

  	
   

  
	
  Section 8.2.

  	
  Amendments

  	
   

  
	
  Section
  8.3.

  	
  Notices

  	
   

  
	
  Section
  8.4.

  	
  Benefit

  	
   

  
	
  Section 8.5.

  	
  Governing Law

  	
   

  
	
  Section 8.6.

  	
  Submission to
  Jurisdiction

  	
   

  
	
  Section 8.7.

  	
  Counterparts

  	
   

  
	
  Section 8.8.

  	
  Severability

  	
   

  
				

 

ii

 

GUARANTEE AGREEMENT, dated as of April
29, 2004, executed and delivered by AMERICAN EQUITY INVESTMENT LIFE HOLDING
COMPANY, an Iowa corporation (the “Guarantor”) having
its principal office at 5000 Westown Parkway, Suite 440, West Des Moines, IA
50266, and JPMORGAN CHASE BANK, a New York banking corporation, as trustee (in
such capacity, the “Guarantee Trustee”), for
the benefit of the Holders (as defined herein) from time to time of the
Preferred Securities (as defined herein) of AMERICAN EQUITY CAPITAL TRUST III,
a Delaware statutory trust (the “Issuer”).

 

WITNESSETH:

 

WHEREAS, pursuant to an Amended and
Restated Trust Agreement, dated as of the date hereof (the “Trust
Agreement”), among the Guarantor, as Depositor, the Property
Trustee, the Delaware Trustee and the Administrative Trustees named therein and
the holders from time to time of the Preferred Securities (as hereinafter
defined), the Issuer is issuing Twenty-Seven Million Dollars ($27,000,000)
aggregate Liquidation Amount (as defined in the Trust Agreement) of its
Floating Rate Preferred Securities (Liquidation Amount $1,000 per preferred
security) (the “Preferred Securities”) representing
preferred undivided beneficial interests in the assets of the Issuer and having
the terms set forth in the Trust Agreement;

 

WHEREAS, the Preferred Securities will
be issued by the Issuer and the proceeds thereof, together with the proceeds
from the issuance of the Issuer’s Common Securities (as defined below), will be
used to purchase the Notes (as defined in the Trust Agreement) of the
Guarantor; and

 

WHEREAS, as incentive for the Holders
to purchase Preferred Securities the Guarantor desires irrevocably and
unconditionally to agree, to the extent set forth herein, to pay to the Holders
of the Preferred Securities the Guarantee Payments (as defined herein) and to
make certain other payments on the terms and conditions set forth herein.

 

NOW, THEREFORE, in consideration of
the purchase by each Holder of Preferred Securities, which purchase the
Guarantor hereby agrees shall benefit the Guarantor, the Guarantor executes and
delivers this Guarantee Agreement to provide as follows for the benefit of the
Holders from time to time of the Preferred Securities:

 

 

ARTICLE I

 

INTERPRETATION
AND DEFINITIONS

 

SECTION 1.1. Interpretation.

 

In
this Guarantee Agreement, unless the context otherwise requires:

 

(a)                                  capitalized terms used in this Guarantee Agreement but
not defined in the preamble hereto have the respective meanings assigned to
them in Section 1.2;

 

(b)                                 the words “include”, “includes” and “including” shall
be deemed to be followed by the phrase “without limitation”;

 

(c)                                  all references to “the Guarantee Agreement” or “this
Guarantee Agreement” are to this Guarantee Agreement as modified, supplemented
or amended from time to time;

 

(d)                                 all references in this Guarantee Agreement to Articles
and Sections are to Articles and Sections of this Guarantee Agreement unless
otherwise specified;

 

(e)                                  the words “hereby”, “herein”, “hereof” and “hereunder”
and other words of similar import refer to this Guarantee Agreement as a whole
and not to any particular Article, Section or other subdivision;

 

(f)                                    a reference to the singular includes the plural and
vice versa; and

 

(g)                                 the masculine, feminine or neuter genders used herein shall
include the masculine, feminine and neuter genders.

 

SECTION 1.2. Definitions.

 

As used in this Guarantee Agreement,
the terms set forth below shall, unless the context otherwise requires, have
the following meanings:

 

“Affiliate” of
any specified Person means any other Person directly or indirectly controlling
or controlled by or under direct or indirect common control with such specified
Person; provided, that the Issuer shall not be
deemed to be an Affiliate of the Guarantor. For the purposes of this
definition, “control” when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms “controlling”
and “controlled” have meanings
correlative to the foregoing.

 

“Beneficiaries” means any Person to whom the Issuer is or hereafter becomes indebted or
liable.

 

2

 

“Board of Directors” means either the board of directors of the Guarantor or any duly authorized
committee of that board.

 

“Common Securities” means the securities representing common undivided beneficial interests in
the assets of the Issuer.

 

“Debt” means
with respect to any Person, whether recourse is to all or a portion of the
assets of such Person, whether currently existing or hereafter incurred, and
whether or not contingent and without duplication, (i) every obligation of such
Person for money borrowed; (ii) every obligation of such Person evidenced by
bonds, debentures, notes or other similar instruments, including obligations
incurred in connection with the acquisition of property, assets or businesses;
(iii) every reimbursement obligation of such Person with respect to letters of
credit, bankers’ acceptances or similar facilities issued for the account of
such Person; (iv) every obligation of such Person issued or assumed as the
deferred purchase price of property or services (but excluding trade accounts
payable arising in the ordinary course of business); (v) every capital lease
obligation of such Person; (vi) all indebtedness of such Person, whether
incurred on or prior to the date of this Guarantee Agreement or thereafter
incurred, for claims in respect of derivative products, including interest
rate, foreign exchange rate and commodity forward contracts, options, swaps and
similar arrangements; (vii) every obligation of the type referred to in clauses
(i) through (vi) of another Person and all dividends of another Person the
payment of which, in either case, such Person has guaranteed or is responsible
or liable for, directly or indirectly, as obligor or otherwise; and (viii) any
renewals, extensions, refundings, amendments or modifications of any obligation
of the type referred to in clauses (i) through (vii).

 

“Event of Default” means a default by the Guarantor on any of its payment or other obligations
under this Guarantee Agreement; provided, that
except with respect to a default in payment of any Guarantee Payments, the
Guarantor shall have received notice of default from the Guarantee Trustee and
shall not have cured such default within thirty (30) days after receipt of such
notice.

 

“Guarantee Payments” means the following payments or distributions, without duplication, with
respect to the Preferred Securities, to the extent not paid or made by or on
behalf of the Issuer: (i) any accumulated and unpaid Distributions (as defined
in the Trust Agreement) required to be paid on the Preferred Securities, to the
extent the Issuer shall have funds on hand available therefor at such time,
(ii) the Redemption Price with respect to any Preferred Securities to the
extent the Issuer shall have funds on hand available therefor at such time, and
(iii) upon a voluntary or involuntary termination, winding up or liquidation of
the Issuer, unless Notes are distributed to the Holders, the lesser of (a) the
aggregate of the Liquidation Amount of $1,000 per Preferred Security plus
accumulated and unpaid Distributions on the Preferred Securities to the date of
payment, to the extent that the Issuer shall have funds available therefor at
such time and (b) the amount of assets of the Issuer remaining available for
distribution to Holders in liquidation of the Issuer after satisfaction of
liabilities to creditors of the Issuer in accordance with applicable law (in
either case, the “Liquidation Distribution”).

 

3

 

“Guarantee Trustee” means JPMorgan Chase Bank, until a Successor Guarantee Trustee, as defined
below, has been appointed and has accepted such appointment pursuant to the
terms of this Guarantee Agreement, and thereafter means each such Successor
Guarantee Trustee.

 

“Guarantor” means
American Equity Investment Life Insurance Company and each of its successors
and assigns.

 

“Issuer” has
the meaning set forth herein above.

 

“Holder” means
any holder, as registered on the books and records of the Issuer, of any
Preferred Securities; provided, that,
in determining whether the holders of the requisite percentage of Preferred
Securities have given any request, notice, consent or waiver hereunder, “Holder”
shall not include the Guarantor, the Guarantee Trustee or any Affiliate of the
Guarantor or the Guarantee Trustee.

 

“Indenture” means
the Junior Subordinated Indenture, dated as of the date hereof, as supplemented
and amended, between the Guarantor and JPMorgan Chase Bank, as trustee.

 

“List of Holders” has the meaning specified in Section 2.1.

 

“Majority in Liquidation Amount of the Preferred Securities” means a vote by the Holder(s), voting separately as a
class, of more than fifty percent (50%) of the aggregate Liquidation Amount of
all then outstanding Preferred Securities issued by the Issuer.

 

“Obligations” means any costs, expenses or liabilities (but not including liabilities
related to taxes) of the Issuer, other than obligations of the Issuer to pay to
holders of any Trust Securities the amounts due such holders pursuant to the
terms of the Trust Securities.

 

“Officers’ Certificate” means, with respect to any Person, a certificate signed
by the Chief Executive Officer, Chief Financial Officer, President or a Vice
President of such Person, and by the Treasurer, an Assistant Treasurer, the
Secretary or an Assistant Secretary of such Person, and delivered to the
Guarantee Trustee. Any Officers’ Certificate delivered with respect to
compliance with a condition or covenant provided for in this Guarantee
Agreement (other than the certificate provided pursuant to Section 2.2)
shall include:

 

(a)           a statement that each officer signing
the Officers’ Certificate has read the covenant or condition and the
definitions relating thereto;

 

(b)           a brief statement of the nature and
scope of the examination or investigation undertaken by each officer in
rendering the Officers’ Certificate;

 

(c)           a statement that each officer has
made such examination or investigation as, in such officer’s opinion, is
necessary to enable such officer to express an informed opinion as to whether
or not such covenant or condition has been complied with; and

 

4

 

(d)           a statement as to whether, in the
opinion of each officer, such condition or covenant has been complied with.

 

“Person” means
a legal person, including any individual, corporation, estate, partnership,
joint venture, association, joint stock company, limited liability company,
trust, unincorporated association, government or any agency or political
subdivision thereof or any other entity of whatever nature.

 

“Preferred Securities” has the meaning set forth in the first recital hereof.

 

“Responsible Officer” means, with respect to the Guarantee Trustee, the
officer in the Institutional Trust Services department of the Trustee having
direct responsibility for the administration of this Guarantee Agreement.

 

“Senior Debt” means the principal of and any premium, if any, and interest on (including
interest accruing on or after the filing of any petition in bankruptcy or for
reorganization relating to the Guarantor whether or not such claim for
post-petition interest is allowed in such proceeding) all Debt of the
Guarantor, whether incurred on or prior to the date of the Indenture or
thereafter incurred, unless it is provided in the instrument creating or
evidencing the same or pursuant to which the same is outstanding, that such
obligations are not superior in right of payment to the Preferred Securities; provided, that if the Guarantor is subject to the regulation
and supervision of an insurance regulatory authority, the Guarantor shall have
received the approval of such appropriate insurance regulatory authority prior
to issuing any such obligation; and provided, further, that
Senior Debt shall not include any other debt securities and guarantees in
respect of such debt securities issued to any trust other than the Trust (or a
trustee of any such trust), partnership or other entity affiliated with the
Guarantor that is a financing vehicle of the Guarantor (a “financing entity”)
in connection with the issuance by such financing entity of equity securities
or other securities that are treated as equity capital for regulatory capital
purposes guaranteed by the Guarantor pursuant to an instrument that ranks pari passu with or junior in right of payment to the
Indenture, including, without limitation, securities issued by American Equity
Capital Trust I, American Equity Capital Trust II, American Equity Capital
Trust III and American Equity Capital Trust IV.

 

“Trust Indenture Act” means the Trust Indenture Act of 1939, as amended and
as in effect on the date of this Guarantee Agreement.

 

“Successor Guarantee Trustee” means a successor Guarantee Trustee possessing the
qualifications to act as Guarantee Trustee under Section 4.1.

 

Capitalized or otherwise defined terms used but not
otherwise defined herein shall have the meanings assigned to such terms in the
Trust Agreement as in effect on the date hereof.

 

5

 

ARTICLE II

 

REPORTS

 

SECTION 2.1. List of
Holders.

 

The Guarantor shall furnish or cause
to be furnished to the Guarantee Trustee at such times as the Guarantee Trustee
may request in writing, within thirty (30) days after the receipt by the
Guarantor of any such request, a list, in such form as the Guarantee Trustee
may reasonably require, of the names and addresses of the Holders (the “List of Holders “) as of a date not more than fifteen (15)
days prior to the time such list is furnished, in each case to the extent such
information is in the possession or control of the Guarantor and is not identical
to a previously supplied list of Holders or has not otherwise been received by
the Guarantee Trustee in its capacity as such. The Guarantee Trustee may
destroy any List of Holders previously given to it on receipt of a new List of
Holders.

 

SECTION 2.2. Periodic
Reports to the Guarantee Trustee.

 

The Guarantor shall deliver to the
Guarantee Trustee, within one hundred and twenty (120) days after the end of
each fiscal year of the Guarantor ending after the date of this Guarantee
Agreement, an Officers’ Certificate covering the preceding fiscal year, stating
whether or not to the knowledge of the signers thereof the Guarantor is in
default in the performance or observance of any of the terms or provisions or
any of the conditions of this Guarantee Agreement (without regard to any period
of grace or requirement of notice provided hereunder) and, if the Guarantor
shall be in default thereof, specifying all such defaults and the nature and
status thereof of which they have knowledge.

 

SECTION 2.3. Event of Default;
Waiver.

 

The Holders of a Majority in
Liquidation Amount of the Preferred Securities may, on behalf of the Holders,
waive any past Event of Default and its consequences. Upon such waiver, any
such Event of Default shall cease to exist, and any Event of Default arising
therefrom shall be deemed to have been cured, for every purpose of this
Guarantee Agreement, but no such waiver shall extend to any subsequent or other
default or Event of Default or impair any right consequent therefrom.

 

SECTION 2.4. Event of
Default; Notice.

 

(a)           The
Guarantee Trustee shall, within ninety (90) days after the occurrence of a
default, transmit to the Holders notices of all defaults actually known to the
Guarantee Trustee, unless such defaults have been cured or waived before the
giving of such notice. For the purpose of this Section 2.4, the term “default” means any event that is, or after notice or lapse
of time or both would become, an Event of Default.

 

(b)           The
Guarantee Trustee shall not be deemed to have knowledge of any Event of Default
unless the Guarantee Trustee shall have received written notice, or a
Responsible Officer charged with the administration of this Guarantee Agreement
shall have obtained written notice, of such Event of Default from the Guarantor
or a Holder.

 

6

 

ARTICLE III

 

POWERS, DUTIES AND RIGHTS OF THE
GUARANTEE TRUSTEE

 

SECTION 3.1. Powers and
Duties of the Guarantee Trustee.

 

(a)           This
Guarantee Agreement shall be held by the Guarantee Trustee for the benefit of
the Holders, and the Guarantee Trustee shall not transfer this Guarantee
Agreement to any Person except a Holder exercising its rights pursuant to Section
5.4(d) or to a Successor Guarantee Trustee upon acceptance by such
Successor Guarantee Trustee of its appointment to act as Successor Guarantee
Trustee. The right, title and interest of the Guarantee Trustee shall
automatically vest in any Successor Guarantee Trustee, upon acceptance by such
Successor Guarantee Trustee of its appointment hereunder, and such vesting and
succession of title shall be effective whether or not conveyancing documents
have been executed and delivered pursuant to the appointment of such Successor
Guarantee Trustee.

 

(b)           The
rights, immunities, duties and responsibilities of the Guarantee Trustee shall
be as provided by this Guarantee Agreement and there shall be no other duties
or obligations, express or implied, of the Guarantee Trustee. Notwithstanding
the foregoing, no provisions of this Guarantee Agreement shall require the
Guarantee Trustee to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties hereunder, or in
the exercise of any of its rights or powers, if it shall have reasonable
grounds for believing that repayment of such funds or adequate indemnity
against such risk or liability is not reasonably assured to it. Whether or not
herein expressly so provided, every provision of this Guarantee Agreement
relating to the conduct or affecting the liability of or affording protection to the Guarantee Trustee shall be subject to the
provisions of this Section 3.1. To the extent
that, at law or in equity, the Guarantee Trustee has duties and liabilities
relating to the Guarantor or the Holders, the Guarantee Trustee shall not be
liable to any Holder for the Guarantee Trustee’s good faith reliance on the
provisions of this Guarantee Agreement. The provisions of this Guarantee
Agreement, to the extent that they restrict the duties and liabilities of the
Guarantee Trustee otherwise existing at law or in equity, are agreed by the
Guarantor and the Holders to replace such other duties and liabilities of the
Guarantee Trustee.

 

(c)           No
provision of this Guarantee Agreement shall be construed to relieve the
Guarantee Trustee from liability for its own negligent action, negligent
failure to act or own willful misconduct, except that:

 

(i)            the Guarantee Trustee shall not be
liable for any error of judgment made in good faith by a Responsible Officer of
the Guarantee Trustee, unless it shall be proved that the Guarantee Trustee was
negligent in ascertaining the pertinent facts upon which such judgment was
made; and

 

(ii)           the Guarantee Trustee shall not be
liable with respect to any action taken or omitted to be taken by it in good
faith in accordance with the direction of the Holders of not less than a
Majority in Liquidation Amount of the Preferred Securities relating to the
time, method and place of conducting any proceeding for any remedy available to
the

 

7

 

Guarantee Trustee, or exercising any
trust or power conferred upon the Guarantee Trustee under this Guarantee
Agreement.

 

SECTION 3.2. Certain
Rights of the Guarantee Trustee.

 

(a)           Subject
to the provisions of Section 3.1:

 

(i)            the Guarantee Trustee may
conclusively rely and shall be fully protected in acting or refraining from
acting in good faith and in accordance with the terms hereof upon any
resolution, certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document reasonably believed by it to be genuine
and to have been signed, sent or presented by the proper party or parties;

 

(ii)           any direction or act of the Guarantor
contemplated by this Guarantee Agreement shall be sufficiently evidenced by an
Officers’ Certificate unless otherwise prescribed herein;

 

(iii)          the Guarantee Trustee may consult with
counsel, and the advice of such counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted to be taken by it hereunder in good faith and in reliance thereon and
in accordance with such advice. Such counsel may be counsel to the Guarantee
Trustee, the Guarantor or any of its Affiliates and may be one of its
employees. The Guarantee Trustee shall have the right at any time to seek
instructions concerning the administration of this Guarantee Agreement from any
court of competent jurisdiction;

 

(iv)          the Guarantee Trustee shall be under
no obligation to exercise any of the rights or powers vested in it by this
Guarantee Agreement at the request or direction of any Holder, unless such
Holder shall have provided to the Guarantee Trustee reasonable security or indemnity
against the costs, expenses (including reasonable attorneys’ fees and expenses)
and liabilities that might be incurred by it in complying with such request or
direction, including such reasonable advances as may be requested by the
Guarantee Trustee; provided, that,
nothing contained in this Section 3.2(a)(iv) shall be taken to relieve
the Guarantee Trustee, upon the occurrence of an Event of Default, of its
obligation to exercise the rights and powers vested in it by this Guarantee
Agreement; provided, further, that nothing
contained in this Section 3.2(a)(iv) shall prevent the Guarantee Trustee
from exercising its rights under Section 4.2 hereof.;

 

(v)           the Guarantee Trustee shall not be
bound to make any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Guarantee Trustee, in its
discretion, may make such further inquiry or investigation into such facts or
matters as it may see fit, and if the Guarantee Trustee shall determine to make
such inquiry or investigation, it shall be entitled to examine the books,
records and premises of the Guarantor, personally or by agent or attorney;

 

8

 

(vi)          the Guarantee Trustee may execute any
of the trusts or powers hereunder or perform any duties hereunder either
directly or by or through its agents, attorneys, custodians or nominees and the
Guarantee Trustee shall not be responsible for any misconduct or negligence on
the part of any such agent, attorney, custodian or nominee appointed with due
care by it hereunder;

 

(vii)         whenever in the administration of this
Guarantee Agreement the Guarantee Trustee shall deem it desirable to receive
instructions with respect to enforcing any remedy or right hereunder, the
Guarantee Trustee (A) may request instructions from the Holders of a Majority
in Liquidation Amount of the Preferred Securities, (B) may refrain from
enforcing such remedy or right or taking such other action until such
instructions are received and (C) shall be protected in acting in accordance
with such instructions;

 

(viii)        except as otherwise expressly provided
by this Guarantee Agreement, the Guarantee Trustee shall not be under any
obligation to take any action that is discretionary under the provisions of
this Guarantee Agreement; and

 

(ix)           whenever, in the administration of
this Guarantee Agreement, the Guarantee Trustee shall deem it desirable that a
matter be proved or established before taking, suffering or omitting to take
any action hereunder, the Guarantee Trustee (unless other evidence is herein
specifically prescribed) may, in the absence of bad faith on its part, request
and rely upon an Officers’ Certificate which, upon receipt of such request from
the Guarantee Trustee, shall be promptly delivered by the Guarantor.

 

(b)           No
provision of this Guarantee Agreement shall be deemed to impose any duty or
obligation on the Guarantee Trustee to perform any act or acts or exercise any
right, power, duty or obligation conferred or imposed on it in any jurisdiction
in which it shall be illegal, or in which the Guarantee Trustee shall be
unqualified or incompetent in accordance with applicable law, to perform any
such act or acts or to exercise any such right, power, duty or obligation. No
permissive power or authority available to the Guarantee Trustee shall be
construed to be a duty to act in accordance with such power and authority.

 

SECTION 3.3. Compensation.

 

The Guarantor agrees to pay to the
Guarantee Trustee from time to time reasonable compensation for all services
rendered by it hereunder (which compensation shall not be limited by any
provisions of law in regard to the compensation of a trustee of an express
trust) and to reimburse the Guarantee Trustee upon request for all reasonable
expenses, disbursements and advances (including the reasonable fees and
expenses of its attorneys and agents) incurred or made by the Guarantee Trustee
in accordance with any provisions of this Guarantee Agreement.

 

SECTION 3.4. Indemnity.

 

The Guarantor agrees to indemnify and
hold harmless the Guarantee Trustee and any of its Affiliates and any of their
officers, directors, shareholders, employees, representatives or agents from
and against any loss, damage, liability, tax (other than income, franchise or
other taxes imposed on amounts paid pursuant to Section 3.3), penalty,
expense or claim of any kind or

 

9

 

nature whatsoever incurred without negligence, bad
faith or willful misconduct on its part, arising out of or in connection with
the acceptance or administration of this Guarantee Agreement, including the
costs and expenses of defending itself against any claim or liability in
connection with the exercise or performance of any of its powers or duties
hereunder. The Guarantee Trustee will not claim or exact any lien or charge on
any Guarantee Payments as a result of any amount due to it under this Guarantee
Agreement. This indemnity shall survive the termination of this Agreement or
the resignation or removal of the Guarantee Trustee.

 

In no event shall the Guarantee
Trustee be liable for any indirect, special, punitive or consequential loss or
damage of any kind whatsoever, including, but not limited to, lost profits,
even if the Guarantee Trustee has been advised of the likelihood of such loss
or damage and regardless of the form of action.

 

In no event shall the Guarantee Trustee
be liable for any failure or delay in the performance of its obligations
hereunder because of circumstances beyond its control, including, but not
limited to, acts of God, flood, war (declared or undeclared), terrorism, fire,
riot, embargo, government action, including any laws, ordinances, regulations,
governmental action or the like which delay, restrict or prohibit the providing
of the services contemplated by this Guarantee Agreement.

 

SECTION 3.5. Securities.

 

The Guarantee Trustee or any other
agent of the Guarantee Trustee, in its individual or any other capacity, may
become the owner or pledgee of Common or Preferred Securities.

 

ARTICLE IV

 

GUARANTEE
TRUSTEE

 

SECTION 4.1. Guarantee
Trustee; Eligibility.

 

(a)           There
shall at all times be a Guarantee Trustee which shall:

 

(i)            not be an Affiliate of the
Guarantor; and

 

(ii)           be a corporation organized and doing
business under the laws of the United States or of any State thereof,
authorized to exercise corporate trust powers, having a combined capital and
surplus of at least fifty million dollars ($50,000,000), subject to supervision
or examination by Federal or State authority and having an office within the
United States. If such corporation publishes reports of condition at least
annually, pursuant to law or to the requirements of such supervising or
examining authority, then, for the purposes of this Section 4.1, the
combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of
condition so published.

 

10

 

(b)           If
at any time the Guarantee Trustee shall cease to be eligible to so act under Section
4.1(a), the Guarantee Trustee shall immediately resign in the manner and
with the effect set out in Section 4.2(c).

 

(c)           If
the Guarantee Trustee has or shall acquire any “conflicting interest” within
the meaning of Section 310(b) of the Trust Indenture Act, the Guarantee Trustee
shall either eliminate such interest or resign in the manner and with the
effect set out in Section 4.2(c).

 

SECTION 4.2. Appointment, Removal and Resignation of the
Guarantee Trustee.

 

(a)           Subject
to Section 4.2(b), the Guarantee Trustee may be appointed or removed
without cause at any time by the Guarantor, except during an Event of Default.

 

(b)           The
Guarantee Trustee shall not be removed until a Successor Guarantee Trustee has
been appointed and has accepted such appointment by written instrument executed
by such Successor Guarantee Trustee and delivered to the Guarantor.

 

(c)           The
Guarantee Trustee appointed hereunder shall hold office until a Successor
Guarantee Trustee shall have been appointed or until its removal or
resignation. The Guarantee Trustee may resign from office (without need for
prior or subsequent accounting) by an instrument in writing executed by the
Guarantee Trustee and delivered to the Guarantor, which resignation shall not
take effect until a Successor Guarantee Trustee has been appointed and has
accepted such appointment by instrument in writing executed by such Successor
Guarantee Trustee and delivered to the Guarantor and the resigning Guarantee
Trustee.

 

(d)           If
no Successor Guarantee Trustee shall have been appointed and accepted
appointment as provided in this Section 4.2 within thirty (30) days
after delivery to the Guarantor of an instrument of resignation, the resigning
Guarantee Trustee may petition, at the expense of the Guarantor, any court of
competent jurisdiction for appointment of a Successor Guarantee Trustee. Such
court may thereupon, after prescribing such notice, if any, as it may deem
proper, appoint a Successor Guarantee Trustee.

 

ARTICLE V

 

GUARANTEE

 

SECTION 5.1. Guarantee.

 

(a)           The
Guarantor irrevocably and unconditionally agrees to pay in full to the Holders
the Guarantee Payments (without duplication of amounts theretofore paid by or
on behalf of the Issuer), as and when due, regardless of any defense (except
for the defense of payment by the Issuer), right of set-off or counterclaim
which the Issuer may have or assert. The Guarantor’s obligation to make a
Guarantee Payment may be satisfied by direct payment of the required amounts by
the Guarantor to the Holders or by causing the Issuer to pay such amounts to
the Holders. The Guarantor shall give prompt written notice to the Guarantee
Trustee in the event it makes any direct payment to the Holders hereunder.

 

11

 

(b)           The
Guarantor hereby also agrees to assume any and all Obligations of the Issuer,
and, in the event any such Obligation is not so assumed, subject to the terms
and conditions hereof, the Guarantor hereby irrevocably and unconditionally
guarantees to each Beneficiary the full payment, when and as due, of any and
all Obligations to such Beneficiaries. This Guarantee is intended to be for the
Beneficiaries who have received notice hereof.

 

SECTION 5.2. Waiver of
Notice and Demand.

 

The Guarantor hereby waives notice of
acceptance of the Guarantee Agreement and of any liability to which it applies
or may apply, presentment, demand for payment, any right to require a
proceeding first against the Guarantee Trustee, Issuer or any other Person
before proceeding against the Guarantor, protest, notice of nonpayment, notice
of dishonor, notice of redemption and all other notices and demands.

 

SECTION 5.3. Obligations
Not Affected.

 

The obligations, covenants, agreements
and duties of the Guarantor under this Guarantee Agreement shall in no way be
affected or impaired by reason of the happening from time to time of any of the
following:

 

(a)           the release or waiver, by operation
of law or otherwise, of the performance or observance by the Issuer of any
express or implied agreement, covenant, term or condition relating to the
Preferred Securities to be performed or observed by the Issuer;

 

(b)           the extension of time for the payment
by the Issuer of all or any portion of the Distributions (other than an
extension of time for payment of Distributions that results from the extension
of any interest payment period on the Notes as provided in the Indenture),
Redemption Price, Liquidation Distribution or any other sums payable under the
terms of the Preferred Securities or the extension of time for the performance
of any other obligation under, arising out of, or in connection with, the
Preferred Securities;

 

(c)           any failure, omission, delay or lack
of diligence on the part of the Holders to enforce, assert or exercise any
right, privilege, power or remedy conferred on the Holders pursuant to the
terms of the Preferred Securities, or any action on the part of the Issuer
granting indulgence or extension of any kind;

 

(d)           the voluntary or involuntary
liquidation, dissolution, sale of any collateral, receivership, insolvency,
bankruptcy, assignment for the benefit of creditors, reorganization,
arrangement, composition or readjustment of debt of, or other similar
proceedings affecting, the Issuer or any of the assets of the Issuer;

 

(e)           any invalidity of, or defect or
deficiency in, the Preferred Securities;

 

(f)            the settlement or compromise of any
obligation guaranteed hereby or hereby incurred; or

 

(g)           any other circumstance whatsoever
that might otherwise constitute a legal or equitable discharge or defense of a
guarantor, it being the intent of this Section 5.3 that

 

12

 

the obligations of the Guarantor
hereunder shall be absolute and unconditional under any and all circumstances.

 

There shall be no obligation of the Holders to give
notice to, or obtain the consent of, the Guarantor with respect to the
happening of any of the foregoing.

 

SECTION 5.4. Rights of
Holders.

 

The Guarantor expressly acknowledges
that: (a) this Guarantee Agreement will be deposited with the Guarantee Trustee
to be held for the benefit of the Holders; (b) the Guarantee Trustee has the
right to enforce this Guarantee Agreement on behalf of the Holders; (c) the
Holders of a Majority in Liquidation Amount of the Preferred Securities have
the right to direct the time, method and place of conducting any proceeding for
any remedy available to the Guarantee Trustee in respect of this Guarantee
Agreement or exercising any trust or power conferred upon the Guarantee Trustee
under this Guarantee Agreement; and (d) any Holder may institute a legal
proceeding directly against the Guarantor to enforce its rights under this
Guarantee Agreement, without first instituting a legal proceeding against the
Guarantee Trustee, the Issuer or any other Person.

 

SECTION 5.5. Guarantee of
Payment.

 

This Guarantee Agreement creates a
guarantee of payment and not of collection. This Guarantee Agreement will not
be discharged except by payment of the Guarantee Payments in full (without
duplication of amounts theretofore paid by the Issuer) or upon distribution of
Notes to Holders as provided in the Trust Agreement.

 

SECTION 5.6. Subrogation.

 

The Guarantor shall be subrogated to
all (if any) rights of the Holders against the Issuer in respect of any amounts
paid to the Holders by the Guarantor under this Guarantee Agreement and shall
have the right to waive payment by the Issuer pursuant to Section 5.1;
provided, that, the Guarantor shall not
(except to the extent required by mandatory provisions of law) be entitled to
enforce or exercise any rights it may acquire by way of subrogation or any
indemnity, reimbursement or other agreement, in all cases as a result of
payment under this Guarantee Agreement, if, at the time of any such payment,
any amounts are due and unpaid under this Guarantee Agreement. If any amount
shall be paid to the Guarantor in violation of the preceding sentence, the
Guarantor agrees to hold such amount in trust for the Holders and to pay over
such amount to the Holders.

 

SECTION 5.7. Independent
Obligations.

 

The Guarantor acknowledges that its
obligations hereunder are independent of the obligations of the Issuer with
respect to the Preferred Securities and that the Guarantor shall be liable as
principal and as debtor hereunder to make Guarantee Payments pursuant to the
terms of this Guarantee Agreement notwithstanding the occurrence of any event
referred to in subsections (a) through (g), inclusive, of Section 5.3.

 

13

 

SECTION 5.8. Enforcement.

 

A Beneficiary may enforce the
Obligations of the Guarantor contained in Section 5.1(b) directly
against the Guarantor, and the Guarantor waives any right or remedy to require
that any action be brought against the Issuer or any other person or entity
before proceeding against the Guarantor.

 

ARTICLE VI

 

COVENANTS
AND SUBORDINATION

 

SECTION 6.1. Dividends, Distributions
and Payments.

 

So long as any Preferred Securities
remain outstanding, if there shall have occurred and be continuing an Event of
Default or the Guarantor shall have entered into an Extension Period as
provided for in the Indenture and such period, or any extension thereof, shall
have commenced and be continuing, then the Guarantor may not (a) declare or pay
any dividends or distributions on, or redeem, purchase, acquire or make
liquidation payment with respect to, any of the Guarantor’s capital stock or
(b) make any payment of principal of or any interest or premium, if any, on or
repay, repurchase or redeem any debt securities of the Guarantor that rank pari passu in all respects with or junior in interest to the
Notes (other than (i) repurchases, redemptions or other acquisitions of shares
of capital stock of the Guarantor in connection with any employment contract,
benefit plan or other similar arrangement with or for the benefit of any one of
more employees, officers, directors or consultants, in connection with a
dividend reinvestment or stockholder stock purchase plan or in connection with
the issuance of capital stock of the Guarantor (or securities convertible into
or exercisable for such capital stock) as consideration in an acquisition
transaction entered into prior to the occurrence of such Event of Default or
the applicable Extension Period, (ii) as a result of an exchange or conversion
of any class or series of the Guarantor’s capital stock (or any capital stock
of a subsidiary of the Guarantor) for any class or series of the Guarantor’s
capital stock or any class of series of the Guarantor’s indebtedness for any
class or series of the Guarantor’s capital stock, (iii) the purchase of
fractional interests in shares of the Guarantor’s capital stock pursuant to the
conversions or exchange provisions of such capital stock or the security being
converted or exchanged, (iv) any declaration of a dividend in connection with
any rights plan, the issuance of rights, stock or other property under any
rights plan or the redemption or repurchase of rights pursuant thereto, or (v)
any dividend in the form of stock, warrants, options or other rights where the
dividend stock or the stock issuable upon exercise of such warrants, options or
other rights is the same stock as that on which the dividend is being paid or
ranks pari passu with or junior to such
stock).

 

SECTION 6.2. Subordination.

 

The obligations of the Guarantor under
this Guarantee Agreement will constitute unsecured obligations of the Guarantor
and will rank subordinate and junior in right of payment to all Senior Debt of
the Guarantor.

 

14

 

SECTION 6.3. Pari Passu
Guarantees.

 

(a) The obligations of the Guarantor
under this Guarantee Agreement shall rank pari passu with
the obligations of the Guarantor under any similar guarantee agreements issued
by the Guarantor with respect to preferred securities (if any) similar to the
Preferred Securities, issued by trusts other than the Issuer established or to
be established by the Guarantor (if any), in each case similar to the Issuer
American Equity Capital Trust I, American Equity Capital Trust II, American
Equity Capital Trust III and American Equity Capital Trust IV.

 

(b) The right of the Guarantor to
participate in any distribution of assets of any of its subsidiaries upon any
such subsidiary’s liquidation or reorganization or otherwise is subject to the
prior claims of creditors of that subsidiary, except to the extent the Guarantor
may itself be recognized as a creditor of that subsidiary. Accordingly, the
Guarantor’s obligations under this Guarantee will be effectively subordinated
to all existing and future liabilities of the Guarantor’s subsidiaries, and
claimants should look only to the assets of the Guarantor for payments
thereunder. This Guarantee does not limit the incurrence or issuance of other
secured or unsecured debt of the Guarantor, including Senior Debt of the
Guarantor, under any indenture or agreement that the Guarantor may enter into
in the future or otherwise.

 

ARTICLE VII

 

TERMINATION

 

SECTION 7.1. Termination.

 

This Guarantee Agreement shall
terminate and be of no further force and effect upon (a) full payment of the
Redemption Price of all Preferred Securities, (b) the distribution of Notes to
the Holders in exchange for all of the Preferred Securities or (c) full payment
of the amounts payable in accordance with the Trust Agreement upon liquidation
of the Issuer. Notwithstanding the foregoing, this Guarantee Agreement will
continue to be effective or will be reinstated, as the case may be, if at any
time any Holder must restore payment of any sums paid with respect to Preferred
Securities or this Guarantee Agreement. The obligations of the Guarantor under Sections
3.3 and 3.4 shall survive any such termination or the resignation
and removal of the Guarantee Trustee.

 

ARTICLE VIII

 

MISCELLANEOUS

 

SECTION 8.1. Successors
and Assigns.

 

All guarantees and agreements
contained in this Guarantee Agreement shall bind the successors, assigns,
receivers, trustees and representatives of the Guarantor and shall inure to the
benefit of the Holders of the Preferred Securities then outstanding. Except in
connection with a consolidation, merger or sale involving the Guarantor that is
permitted under Article VIII of the Indenture and pursuant to which the
successor or assignee agrees in writing to perform the

 

15

 

Guarantor’s obligations hereunder, the Guarantor shall
not assign its rights or delegate its obligations hereunder without the prior
approval of the Holders of a Majority in Liquidation Amount of the Preferred
Securities.

 

SECTION 8.2. Amendments.

 

Except with respect to any changes
that do not adversely affect the rights of the Holders in any material respect
(in which case no consent of the Holders will be required), this Guarantee
Agreement may only be amended with the prior approval of the Guarantor, the
Guarantee Trustee and the Holders of not less than a Majority in Liquidation
Amount of the Preferred Securities. The provisions of Article VI of the Trust
Agreement concerning meetings or consents of the Holders shall apply to the
giving of such approval.

 

SECTION 8.3. Notices.

 

Any notice, request or other
communication required or permitted to be given hereunder shall be in writing,
duly signed by the party giving such notice, and delivered, telecopied or
mailed by first class mail as follows:

 

(a)           if given to the Guarantor, to the
address or facsimile number set forth below or such other address, facsimile
number or to the attention of such other Person as the Guarantor may give
notice to the Guarantee Trustee and the Holders:

 

American Equity Investment Life
Insurance Company

5000 Westown Parkway, Suite 440

West Des Moines, IA 50266

Facsimile No.: (515) 221-0744

Attention: Wendy Carlson

 

(b)           if given to the Issuer, at the Issuer’s
address or facsimile number set forth below or such other address, facsimile
number or to the attention of such other Person as the Issuer may give notice
to the Guarantee Trustee and the Holders:

 

American Equity Capital Trust III

5000 Westown Parkway, Suite 440

West Des Moines, IA 50266

Facsimile No.: (515) 221-0744

Attention: Wendy Carlson

 

(c)           if given to the Guarantee Trustee, at
the address or facsimile number set forth below or such other address,
facsimile number or to the attention of such other Person as the Guarantee
Trustee may give notice to the Guarantor and the Holders:

 

16

 

JPMorgan Chase Bank

600 Travis, 50th Floor

Houston, Texas 77002

Facsimile No.: 713-216-2101

Attention: International Trust
Services -

American Equity Capital Trust III

 

(d)           if given to any Holder, at the
address set forth on the books and records of the Issuer.

 

All notices hereunder shall be deemed
to have been given when received in person, telecopied with receipt confirmed,
or mailed by first class mail, postage prepaid, except that if a notice or
other document is refused delivery or cannot be delivered because of a changed
address of which no notice was given, such notice or other document shall be
deemed to have been delivered on the date of such refusal or inability to
deliver.

 

SECTION 8.4. Benefit.

 

This Guarantee Agreement is solely for
the benefit of the Holders and is not separately transferable from the
Preferred Securities.

 

SECTION 8.5. Governing
Law.

 

This Guarantee
Agreement and the rights and obligations of each party hereto, shall be
construed and enforced in accordance with and governed by the laws of the State
of New York without reference to its conflict of laws provisions (other than
Section 5-1401 of the General Obligations Law).

 

SECTION 8.6. Submission
to Jurisdiction.

 

ANY LEGAL ACTION OR PROCEEDING BY OR
AGAINST ANY PARTY HERETO OR WITH RESPECT TO OR ARISING OUT OF THIS GUARANTEE
AGREEMENT MAY BE BROUGHT IN OR REMOVED TO THE COURTS OF THE STATE OF NEW YORK,
IN AND FOR THE COUNTY OF NEW YORK, OR OF THE UNITED STATES OF AMERICA FOR THE
SOUTHERN DISTRICT OF NEW YORK (IN EACH CASE SITTING IN THE BOROUGH OF
MANHATTAN). BY EXECUTION AND DELIVERY OF THIS GUARANTEE AGREEMENT, EACH PARTY
ACCEPTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND
UNCONDITIONALLY, THE JURISDICTION OF THE AFORESAID COURTS (AND COURTS OF
APPEALS THEREFROM) FOR LEGAL PROCEEDINGS ARISING OUT OF OR IN CONNECTION WITH
THIS GUARANTEE AGREEMENT.

 

SECTION 8.7. Counterparts.

 

This instrument may be executed in any
number of counterparts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute but one and the
same instrument.

 

17

 

SECTION 8.8. Severability.

 

In the event that one or more of the
provisions contained in this Guarantee Agreement shall, for any reason, be held
to be invalid, illegal or unenforceable in any respect, such invalidity,
illegality or unenforceability shall not affect any other provisions of this
Guarantee, but this Guarantee shall be construed as if such invalid, illegal or
unenforceable provision had never been contained herein.

 

[Signature pages follow.]

 

18

 

IN WITNESS WHEREOF, the undersigned
have executed this Guarantee Agreement as of the date first above written.

 

 

	
   

  	
  AMERICAN EQUITY INVESTMENT LIFE HOLDING

  COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Debra J. Richardson

  	
   

  
	
   

  	
  Name: Debra J. Richardson

  
	
   

  	
  Title: Secretary & Senior Vice
  President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  JPMORGAN CHASE BANK, as Guarantee
  Trustee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Maria D. Calzado

  	
   

  
	
   

  	
  Name: Maria D. Calzado

  
	
   

  	
  Title: Vice President

  
						

 

 

Guarantee

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00074-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00074-of-00352.parquet"}]]