Document:

<PAGE>

                                 LOAN AGREEMENT

1.  PARTIES. The parties to this Agreement are David J. Noble ("NOBLE") and
    American Equity Investment Life Holding Company (the "COMPANY"), an
    Iowa corporation, headquartered in West Des Moines, Iowa.

2.  PURPOSE. The Company is an insurance holding company group engaged
    primarily in the sale of annuities and other life insurance products.
    Noble is the President and Chairman of the Company. Noble and the Company
    believe it is mutually advantageous to provide for a loan by the Company
    to Noble as an inducement to him to remain employed by the Company in his
    present capacities. The purpose of this Agreement is to specify the terms
    and conditions under which the loan is to be repaid.

3.  DURATION OF AGREEMENT. This Agreement shall commence on May 1, 2000 and
    expire on April 30, 2005, unless terminated or extended in writing by the
    parties.

4.  LOAN. The Company shall loan to Noble Eight Hundred Thousand Dollars
    ($800,000) pursuant to the attached Promissory Note. Noble is obligated to
    repay that Promissory Note unless he continues as President and Chairman
    of the Company for the entire term of the Note. If certain conditions are
    met, the Company shall forgive amounts due under the Promissory Note to
    the extent specified herein.

         4.1      INTEREST RATE.  The principal balance of the Note will bear
                  interest at the rate of 6.50%  per
                  annum.

         4.2      ANNUAL INSTALLMENT PAYMENTS. Payments shall be made in 5 equal
                  annual installments of principal and interest, each in the
                  amount of $192,508, with the first such payment due April 30,
                  2001, and continuing thereafter on April 30 of each year
                  through and including April 30, 2005.

         4.3      SCHEDULED FORGIVENESS. If Noble is continuously employed by
                  the Company through each of the dates specified below, then
                  the following payments on the Promissory Note shall be
                  forgiven on the following dates:

                  On April 30, 2001, the Company shall forgive the amount of
                  $192,508.

                  On April 30, 2002, the Company shall forgive the amount of
                  $192,508.

                  On April 30, 2003, the Company shall forgive the amount of
                  $192,508.

                  On April 30, 2004, the Company shall forgive the amount of
                  $192,508.

                  On April 30, 2005, the Company shall forgive the amount of
                  $192,508.

         4.4      CONTINUOUS EMPLOYMENT. The forgiving of any debt described in
                  Section 4.3 above shall occur only if Noble is continuously
                  employed by the Company from the date hereof through and
                  including the dates on which such forgiveness is scheduled, or
                  in accordance with Section 4.5 or Section 4.6 below.

                                      -1-

<PAGE>

         4.5      DEATH OR DISABILITY. In the event Noble should die or become
                  permanently disabled (as hereinafter defined) prior to April
                  30, 2005, then any remaining balance of principal and interest
                  on the Promissory Note shall be forgiven in full as of the
                  date of death or determination of permanent disability. For
                  purposes of this Agreement, Noble shall be deemed to be
                  "permanently disabled" upon the written certification of his
                  physician that he is unable to perform his essential functions
                  as President and Chairman of the Company and that such
                  disability will prevent him from performing such functions for
                  an indefinite period expected to exceed at least 180 days.

         4.6      CHANGE OF CONTROL. In the event of a "change of control" as
                  hereinafter defined, then: (i) any remaining balance of
                  principal and interest on the Promissory Note shall be
                  forgiven in full on the effective date such change of control;
                  and (ii) Company shall reimburse Noble for up to $500,000 of
                  the amount of excise taxes under Section 280G of the Internal
                  Revenue Code (as amended) as may be payable by him, if any, in
                  connection with the forgiveness of the balance of the
                  Promissory Note pursuant to subclause (i) of this Section 4.6.

                  For purposes of this Agreement the term "change of control"
                  shall be deemed to have occurred if: (a) any person,
                  organization or association of persons or organizations acting
                  in concert, excluding affiliates of the Company itself, shall
                  acquire more than twenty percent (20%) of the outstanding
                  voting stock of the Company in whole or in part by means of an
                  offer made publicly to the holders of all or substantially all
                  of the outstanding shares of any one or more classes of the
                  voting securities of the Company to acquire such shares for
                  cash, other property or a combination thereof; or (b) any
                  person, organization or association of persons or
                  organizations acting in concert shall succeed in electing two
                  or more directors in any one election in opposition to those
                  proposed by management; or (c) the Company transfers all or
                  substantially all of its operating properties and assets to
                  another person, organization or association of persons or
                  organizations, excluding affiliates of the Company itself; or
                  the Company shall consolidate with or merge into any person,
                  firm or corporation unless the Company or a Subsidiary shall
                  be the continuing corporation or the successor corporation;

         4.7      WITHHOLDING. Noble hereby agrees and acknowledges that the
                  forgiveness of any payment due under the Promissory Note will
                  constitute compensation subject to state and federal income
                  taxation and withholding requirements. Noble further agrees
                  and acknowledges that such withholding could amount to 40% or
                  more of the amounts forgiven, depending upon the amount of
                  Noble's other compensation from the Company. On each date
                  specified in Section 4.3 above on which the forgiveness of any
                  payment is to occur, Noble agrees to pay to the Company the
                  full amount of any federal, state and/or local tax which, in
                  the opinion of counsel for the Company, must be collected,
                  withheld, or paid over by the Company in connection with such
                  compensation, excluding the portion of FICA withholding for
                  which Noble is responsible. If Noble should fail to make any
                  payment required by this Section 4.5, then the Company, at its
                  option, may deduct the amount of such withholding from any
                  other payments due to Noble by the Company, or may declare the
                  Promissory Note in default.

                                      -2-

<PAGE>

5.  ASSIGNABILITY. No right to Noble hereunder shall be assigned or assignable
    by voluntary or involuntary assignment.

6.  APPLICABLE LAW. This Agreement shall be subject to and construed under the
    laws of the state of Iowa.

7.  CONFIDENTIALITY. It is further understood and agreed that the parties to
    this Agreement shall not disclose, comment on, or publish in any manner, to
    any person, association, organization or entity, the substance or the terms
    and conditions of this Agreement, unless the nondisclosing party gives its
    prior written consent to any instance of such disclosure, comment or
    publication.

    Nothing herein shall prohibit the parties from disclosing the substance
    or the terms and conditions of this Agreement should such disclosure be
    required for the preparation of their respective tax returns, to enforce
    its terms or to respond to inquiries from taxing or other governmental
    authorities, hearings, investigations, or other official proceedings.

    IN WITNESS WHEREOF, the Company and Noble have caused this Agreement to
be executed on the date written below.

<TABLE>
<CAPTION>

AMERICAN EQUITY INVESTMENT                     DAVID J. NOBLE
LIFE HOLDING COMPANY

By:  /s/ James M. Gerlach                      /s/ David J. Noble
     ---------------------                     ----------------------
<S>                                            <C>
     James M. Gerlach                          David J. Noble
     Executive Vice President
</TABLE>

Date: April 30, 2000

                                 -3-

<PAGE>

                             PROMISSORY NOTE

$800,000.00                                  West Des Moines, Iowa: May 1, 2000

          FOR VALUE RECEIVED, the undersigned, DAVID J. NOBLE, an individual
residing at 5461 Gulf of Mexico Drive #204, Long Boat Key, Florida ("Borrower"),
promises to pay to the order of AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY
("Lender"), an Iowa corporation with principal offices located at 5000 Westown
Parkway, West Des Moines, Iowa 50266, the principal sum of Eight Hundred
Thousand Dollars ($800,000), with interest thereon at the rate of 6.50% per
annum, in five (5) equal annual installments of principal and interest,
beginning on the 30th day of April, 2001 and continuing on the 30th day of each
April through and including April 30, 2005.

          This Promissory Note is made in accordance with a Loan Agreement of
even date herewith between the parties hereto. Any event of default specified in
the Loan Agreement shall constitute an event of default hereunder. Except as to
payments forgiven in accordance with the terms of the Loan Agreement, all
payments of principal and interest under this Note shall be made in lawful money
of the United States of America in immediately available funds at such place as
may be designated by the Lender to the Borrower in writing.

          Upon the occurrence of any default specified in the Loan Agreement,
then the entire balance of unpaid principal and interest hereunder shall become
immediately due and payable at the option of the Lender without further notice.
The Borrower agrees to pay all costs of collection or enforcement hereof
incurred by Lender including without limitation reasonable attorney fees.

           All parties hereto, whether as makers, endorsers, or otherwise,
severally waive presentment, demand, protest and notice of dishonor in
connection with this Note.

           This Note is made under and governed by the internal laws of the
State of Iowa.

                                   /s/ David J. Noble
                                   -------------------------
                                   David J. Noble<PAGE>

                 AMERICAN EQUITY INVESTMENT LIFE HOLDING COMPANY
                         2000 EMPLOYEE STOCK OPTION PLAN

         WHEREAS, the Board of Directors of American Equity Investment Life
Holding Company (the "Company") deem it in the best interest of the Company that
certain employees and officers of the Company and its affiliates be given an
opportunity to acquire an interest in the operation and growth of the Company as
a means of assuring their maximum effort and continued association with the
Company; and

         WHEREAS, the Board believes that the Company can best obtain these and
other benefits by granting incentive or non-qualified stock options to employees
and officers designated from time to time, pursuant to this Plan;

         NOW, THEREFORE, the Board does hereby adopt this 2000 Employee Stock
Option Plan, subject to approval, within twelve (12) months of the date of
adoption, by at least a majority of the shares voting at a stockholder's
meeting, and subject to any necessary authorizations from any governmental
authority.

                                    ARTICLE I
                                   DEFINITIONS

         Except where the context otherwise indicates, the following definitions
apply:

         1.1. "Affiliate" means parent or subsidiary corporations of the
Company, as defined in Sections 424(e) and (f) of the Code (but substituting
"the Company" for "employer corporation"), including parents or subsidiaries of
the Company which become such after adoption of the Plan.

         1.2. "Agreement" means a written agreement granting an
Option that is executed by the Company and the Optionee.

         1.3. "Board" means the Board of Directors of the Company.

         1.4. "Code" means the Internal Revenue Code of 1986, as
amended.

         1.5. "Committee" means the committee of the Board appointed by the
Board to administer the Plan. Unless otherwise determined by the Board, the
Compensation Committee of the Board shall be the Committee.

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

         1.7. "Company" means American Equity Investment Life Holding
Company, an Iowa corporation.

         1.8. "Date of Exercise" means the date on which the Company receives
notice of the exercise of an Option and payment of the exercise price in
accordance with the terms of Article VII hereof.

         1.9. "Date of Grant" means the date on which an Option is granted under
the Plan.

         1.10. "Director" means a member of the Board of Directors of the
Company or any Affiliate.

<PAGE>

         1.11 "Disability" means permanent and total disability within the
meaning of Section 22(e)(3) of the Code, as determined by the Committee.

         1.12. "Eligible Individual" means any Employee or Director or who is
also an Employee. Persons who are Directors of the Company who are not also
Employees shall not be Eligible Individuals.

         1.13. "Employee" means any employee of the Company or an Affiliate or
any person who has been hired to be an employee of the Company or an Affiliate.

         1.14. "Fair Market Value" means the fair market value of a Share as
determined by the Committee pursuant to a reasonable method adopted in good
faith for such purpose.

         1.15. "Incentive Stock Option" means an Option granted under the Plan
that qualifies as an incentive stock option under Section 422 of the Code and
that the Company designates as such in the Agreement granting the Option.

         1.16. "Non-qualified Stock Option" means an Option granted under the
Plan that is not an Incentive Stock Option.

         1.17. "Option" means an option to purchase Shares granted under the
Plan.

         1.18. "Option Period" means the period during which an Option may be
exercised.

         1.19. "Option Price" means the price per Share at which an Option may
be exercised, provided, however, that the Option Price shall not be less than
the Fair Market Value of a Share as of the Date of Grant. Notwithstanding the
foregoing, in the case of an Incentive Stock Option granted to an Optionee who
is a Ten-percent Stockholder, the Option Price shall not be less than one
hundred and ten percent (110%) of the Fair Market Value on the Date of Grant.
The Option Price of any Option shall be subject to adjustment to the extent
provided in Article IX hereof, subject to Section 6.3 hereof.

         1.20. "Optionee" means an Eligible Individual to whom an Option has
been granted.

         1.21. "Plan" means the American Equity Investment Life Holding Company
2000 Employee Stock Option Plan.

         1.22. "Share" means a share of Common Stock.

         1.23. "Ten-percent Stockholder" means, in accordance with the rules of
Section 424(d) of the Code, a person owning stock with more than ten percent of
the total combined voting power of all classes of stock of the Company or an
Affiliate.
                                   ARTICLE II
                                    PURPOSE

         The Plan is intended to assist the Company and its Affiliates in
attracting and retaining Eligible Individuals of outstanding ability and to
promote the identification of their interests with those of the stockholders of
the Company.

<PAGE>

                                   ARTICLE III
                                 ADMINISTRATION

         The Committee shall administer the Plan and shall have plenary
authority and discretion, subject to the provisions of the Plan, to determine
the terms (which terms need not be identical) of all Options including, but not
limited to, which Eligible Individuals shall be granted Options, the time or
times at which Options are granted, the Option Price, the number of Shares
subject to an Option, whether an Option shall be an Incentive Stock Option or a
Non-qualified Stock Option, any provisions relating to vesting, any
circumstances in which Options terminate or Shares may be repurchased by the
Company, the period during which Options may be exercised and any other
restrictions on Options. In making these determinations, the Committee may take
into account the nature of the services rendered by the Optionees, their present
and potential contributions to the success of the Company and its Affiliates,
and such other factors as the Committee in its discretion shall deem relevant.
Subject to the provisions of the Plan, the Committee shall have plenary
authority to construe and interpret the Plan and the Agreements, to prescribe,
amend and rescind rules and regulations relating to the Plan and to make all
other determinations deemed necessary or advisable for the administration of the
Plan, including, but not limited to, any determination to accelerate the vesting
of outstanding Options. The determinations of the Committee on the matters
referred to in this Article III shall be binding and final.

                                   ARTICLE IV
                                   ELIGIBILITY

         Options may be granted only to Eligible Individuals and only Employees
shall be eligible to receive Incentive Stock Options.

                                    ARTICLE V
                            STOCK SUBJECT TO THE PLAN

         5.1. NUMBER OF SHARES RESERVED. Subject to adjustment as provided in
Article IX hereof, the maximum number of Shares that may be issued under the
Plan is 600,000 Shares (to be adjusted to 1,800,000 Shares if the Board
authorizes a three-for-one stock split at its May 5, 2000 meeting).

         5.2. TERMINATED OPTIONS AVAILABLE FOR GRANT. If an Option expires or
terminates for any reason without having been fully exercised, the unissued
Shares which had been subject to such Option shall become available for the
grant of additional Options.

                                   ARTICLE VI
                                     OPTIONS

         6.1. DESIGNATION OF OPTIONS AS INCENTIVE OR NON-QUALIFIED. Options
granted under the Plan shall be either Incentive Stock Options or Non-qualified
Stock Options, as designated by the Committee. Each Option granted under the
Plan shall be clearly identified either as an Incentive Stock Option or a
Nonqualified Stock Option and shall be evidenced by an Agreement that specifies
the terms and conditions of the grant. In the event the Committee shall fail to
identify any Option granted as an Incentive Stock Option or Non-qualified Stock
Option, such Option shall be a Non-qualified Stock Option. Options granted to
Eligible Individuals shall be subject to the terms and conditions set forth in
this Article VI hereof and such other terms and conditions not inconsistent with
this Plan as the Committee may specify. All Incentive Stock Options shall comply
with the provisions of the Code governing incentive stock

<PAGE>

options and with all other applicable rules and regulations.

         6.2. OPTION PERIOD. The Option Period for Options granted to Eligible
Individuals shall be determined by the Committee and specifically set forth in
the Agreement; provided, however, that (a) an Option shall not be exercisable
after ten years (five years in the case of an Incentive Stock Option granted to
a Ten-Percent Stockholder) from its Date of Grant; and (b) in the case of the
termination of employment of an Optionee, or the death or disability of an
Optionee, the Option Period shall be as follow:

         (i)      TERMINATION OF EMPLOYMENT. Upon termination of an Optionee's
                  employment with the Company, or the relevant Affiliate, his or
                  her Option privileges, shall be limited to the shares
                  purchasable by him or her as of the date that his or her
                  employment was terminated, and such Option privileges shall
                  expire sixty (60) days from the date that his or her
                  employment was terminated. Nothing contained herein shall be
                  construed to extend the ultimate term of the Option beyond the
                  period of time as set out above.

         (ii)     DISABILITY OR DEATH OF OPTIONEE. If an Optionee's employment
                  with the Company is terminated because of his death or
                  disability, his Option privileges shall expire unless
                  exercised within one (1) year after the date that his
                  employment was terminated. In the event of the death of the
                  Optionee, his Options may be exercised by the Optionee's
                  designated beneficiary. Nothing contained herein shall be
                  construed to extend the ultimate term of the Option beyond the
                  period of time as set out above.

         6.3. NO REISSUANCE AT REDUCED PRICE. Notwithstanding anything to the
contrary in this Plan, without the approval of the stockholders of the Company,
no Option shall be issued in exchange for or as a reissuance of any outstanding
Option or the Option Price for any outstanding Option shall not be changed, if
the effect of such exchange or change would be to reduce the Option Price for
any outstanding Option, except as necessary to reflect the effect of a stock
split, stock dividend or similar event as described in Article IX hereof.

         6.4 MAXIMUM OPTIONS PER EMPLOYEE. The maximum number of Options which
may be granted to any Eligible Individual in any one fiscal year is 75,000
(subject to adjustment for a stock split, stock dividend or similar event, as
described in Article IX hereof).

                                   ARTICLE VII
                               EXERCISE OF OPTIONS

         7.1. NOTICE OF EXERCISE. An Option may, subject to the terms of the
applicable Agreement under which it is granted, be exercised in whole or in part
by the delivery to the Company of written notice of the exercise, in such form
as the Committee may prescribe, accompanied by full payment of the Option Price
for the Shares with respect to which the Option is exercised as provided in
Section 7.2 hereof.

         7.2. PAYMENT OF EXERCISE PRICE. Payment of the aggregate Option Price
for the Shares with respect to which an Option is being exercised shall be made
in cash; provided, however, that the Committee, in its sole discretion, may
provide in an Agreement that part or all of such payment may be made by the
Optionee in one or more of the following manners:

         (i)      By delivery (including constructive delivery) to the Company
                  of Shares valued at Fair Market Value on Date of Exercise;

<PAGE>

         (ii)     By delivery on a form prescribed by the Committee of a
                  properly executed exercise notice and irrevocable instructions
                  to a registered securities broker approved by the Committee to
                  sell Shares and promptly deliver cash to the Company; or

          (iii)   By delivery of a promissory note as provided in Section 7.3
                  hereof.

         7.3. PAYMENT BY PROMISSORY NOTE. To the extent provided in an Option
Agreement and permitted by applicable law, the Committee may accept as payment
of the Option Price a promissory note executed by the Optionee evidencing his or
her obligation to make future cash payment thereof. Promissory notes made
pursuant to this Section 7.3 shall be payable upon such terms as may be
determined by the Committee, shall be secured by a pledge of the Shares received
upon exercise of the Option and shall bear interest at a rate fixed by the
Committee.

         7.4 MINIMUM EXERCISE.  No Option may be exercised for less than fifty
(50) shares.

         7.5 MINIMUM VESTING PERIOD. In the absence of a specified vesting
schedule established by the Committee and set forth in the applicable agreement
evidencing the grant of any options, all options will vest six months after the
date of grant. Should the employment of any Optionee be terminated for any
reason (except death or disability) with or without cause, prior to the
expiration of six months or the vesting schedule established by the Committee,
which ever is the later, the Optionee will forfeit all options not fully vested
on the effective date of such termination.

         7.6 ACCELERATION OF VESTING. If an Option contains a vesting schedule
or has not become totally exercisable as of the date of any of the following
events, such vesting schedule may be accelerated, and/or any other restrictions
to exercise may be removed upon delivery to the Committee of a written election
of such acceleration by the Optionee (or the designated beneficiary of a
deceased Optionee):

                  (i)      The death of the Optionee;

                  (ii)     The Disability of the Optionee;

                  (iii) A "change of control" as hereinafter defined.

         7.7 CHANGE OF CONTROL. For purposes of this Plan, a "change in control"
shall be deemed to have occurred on such date if:

         (i)      Any person, organization or association of persons or
                  organizations acting in concert, excluding Affiliates of the
                  Company itself, shall acquire more than twenty percent (20%)
                  of the outstanding voting stock of the Company in whole or in
                  part by means of an offer made publicly to the holders of all
                  or substantially all of the outstanding shares of any one or
                  more classes of the voting securities of the Company to
                  acquire such shares for cash, other property or a combination
                  thereof; or

         (ii)     Any person, organization or association of persons or
                  organizations acting in concert shall succeed in electing two
                  or more directors in any one election in opposition to those
                  proposed by management; or

<PAGE>

         (iii)      The Company transfers all or substantially all of its
                    operating properties and assets to another person,
                    organization or association of persons or
                    organizations, excluding Affiliates of the Company
                    itself; or

         (iv)       The Company shall consolidate with or merge into any
                    person, firm or corporation unless the Company or an
                    Affiliate shall be the continuing corporation or the
                    successor corporation;

                                  ARTICLE VIII
                            RESTRICTIONS ON TRANSFER

         Options shall not be transferable other than by will or the laws of
descent and distribution. An Option may be exercised during the Optionee's
lifetime only by the Optionee or, in the event of his or her legal disability,
by his or her legal representative. The Shares acquired pursuant to the Plan
shall be subject to such restrictions and agreements regarding sale, assignment,
encumbrances, or other transfers or dispositions thereof (i) as are in effect
among the stockholders of the Company at the time such Shares are acquired or
(ii) as the Committee shall deem appropriate or as are required by applicable
law.

                                   ARTICLE IX
                               CAPITAL ADJUSTMENTS

         In the event of any change in the outstanding Common Stock by reason of
any stock dividend, split-up (or reverse stock split), recapitalization,
reclassification, reorganization, reincorporation, combination or exchange of
shares, merger, consolidation, liquidation or similar change in corporate
structure, the Committee may, in its discretion and to the extent necessary to
compensate for the effect thereof, provide for a substitution for or adjustment
in (i) the number and class of Shares subject to outstanding Options, (ii) the
Option Price of outstanding Options, and (iii) the aggregate number and class of
Shares that may be issued under the Plan.

                                    ARTICLE X
                            TERMINATION OR AMENDMENT

         The Board may amend, alter, suspend or terminate the Plan in any
respect at any time; provided, however, that after the Plan has been approved by
the stockholders of the Company, no amendment, alteration, suspension or
termination of the Plan shall be made by the Board without approval of (i) the
Company's stockholders to the extent stockholder approval is required by
applicable law or regulations and (ii) each affected Optionee if such amendment,
alteration, suspension or termination would adversely affect his or her rights
or obligations under any Option granted prior to the date of such amendment,
alteration, suspension or termination. No Option may be granted nor any Shares
issued under the Plan during any suspension or after termination of the Plan.

<PAGE>

                                   ARTICLE XI
       MODIFICATION, EXTENSION AND RENEWAL OF OPTIONS; SUBSTITUTED OPTIONS

         Subject to the terms and conditions of the Plan, the Committee may
modify, extend or renew the terms of any outstanding Options, or accept the
surrender of outstanding Options granted under the Plan or options and stock
appreciation rights granted under any other plan of the Company or an Affiliate
(to the extent not theretofore exercised) and authorize the granting of new
Options in substitution therefor (to the extent not theretofore exercised).
Subject to Section 6.3 hereof, any such substituted Options may specify a longer
term than the surrendered options and stock appreciation rights, or have any
other provisions that are authorized by the Plan. Notwithstanding the foregoing,
however, no modification of an Option shall, without the consent of the
Optionee, alter or impair any of the Optionee's rights or obligations under such
Option. Anything contained herein to the contrary notwithstanding, Options may,
at the discretion of the Committee, be granted under the Plan in substitution
for stock appreciation rights and options to purchase shares of capital stock of
another corporation which is merged into, consolidated with, or all or a
substantial portion of the property or stock of which is acquired by, the
Company or one of its Affiliates. The terms and conditions of the substitute
Options so granted may vary from the terms and conditions set forth in this Plan
to such extent as the Committee may deem appropriate in order to conform, in
whole or part, to the provisions of the options and stock appreciation rights in
substitution for which they are granted.

                                   ARTICLE XII
                           EFFECTIVENESS OF THE PLAN

         The Plan and any amendment thereto shall be effective on the date on
which it is adopted by the Board, provided that any such adoption requiring
stockholder approval is subject to approval by vote of the stockholders of the
Company within 12 months after such adoption by the Board. Options may be
granted prior to stockholder approval of the Plan, and the date on which any
such Option is granted shall be the Date of Grant for all purposes provided that
(a) each such Option shall be subject to stockholder approval of the Plan, (b)
no Option may be exercised prior to such stockholder approval, and (c) any such
Option shall be void ab initio if such stockholder approval is not obtained.

                                  ARTICLE XIII
                                   WITHHOLDING

         The Company's obligation to deliver Shares or pay any amount pursuant
to the terms of any Option shall be subject to the satisfaction of applicable
federal, state and local tax withholding requirements. To the extent provided in
the applicable Agreement and in accordance with rules prescribed by the
Committee, an Optionee may satisfy any such withholding tax obligation by any of
the following means or by a combination of such means: (i) tendering a cash
payment, (ii) authorizing the Company to withhold Shares otherwise issuable to
the Optionee, or (iii) delivering to the Company already owned and unencumbered
Shares.

                                   ARTICLE XIV
                                TERM OF THE PLAN

         Unless sooner terminated by the Board pursuant to Article X hereof, the
Plan shall terminate on June 30, 2010, and no Options may be granted after such
date. The termination of the Plan shall not affect the validity of any Option
outstanding on the date of termination.

<PAGE>

                                   ARTICLE XV
                          INDEMNIFICATION OF COMMITTEE

         In addition to such other rights of indemnification as they may have as
Directors or as members of the Committee, the members of the Committee shall be
indemnified by the Company against the reasonable expenses, including attorneys'
fees, actually and reasonably incurred in connection with the defense of any
action, suit or proceeding, or in connection with any appeal therein, to which
they or any of them may be a party by reason of any action taken or failure to
act under or in connection with the Plan or any Option granted hereunder, and
against all amounts reasonably paid by them in settlement thereof or paid by
them in satisfaction of a judgment in any such action, suit or proceeding, if
such members acted in good faith and in a manner which they believed to be in,
and not opposed to, the best interests of the Company.

                                   ARTICLE XVI
                               GENERAL PROVISIONS

         16.1. NO OTHER RIGHTS CONFERRED. The establishment of the Plan shall
not confer upon any Eligible Individual any legal or equitable right against the
Company, any Affiliate or the Committee, except as expressly provided in the
Plan.

         16.2. NO EMPLOYMENT CONTRACT. The Plan does not constitute inducement
or consideration for the employment or service of any Eligible Individual, nor
is it a contract between the Company or any Affiliate and any Eligible
Individual. Participation in the Plan shall not give an Eligible Individual any
right to be retained in the service of the Company or any Affiliate.

         16.3. NO LIMITATION ON OTHER STOCK OPTION, ETC. Neither the adoption of
this Plan nor its submission to the stockholders, shall be taken to impose any
limitations on the powers of the Company or its Affiliates to issue, grant, or
assume options, warrants, rights, or restricted stock, otherwise than under this
Plan, or to adopt other stock option or restricted stock plans or to impose any
requirement of stockholder approval upon the same.

         16.4. PLAN INTEREST NOT SUBJECT TO CREDITOR CLAIMS. The interests of
any Eligible Individual under the Plan are not subject to the claims of
creditors and may not, in any way, be assigned, alienated or encumbered except
as provided in an Agreement.

         16.5. APPLICABLE LAWS. The Plan shall be governed, construed and
administered in accordance with the laws of the State of Iowa and it is the
intention of the Company that Incentive Stock Options granted under the Plan
qualify as such under Section 422 of the Code.

         16.6. REPRESENTATIONS REGARDING INVESTMENT INTENT; RESTRICTIVE LEGENDS.
The Committee may require each person acquiring Shares pursuant to Options
hereunder to represent to and agree with the Company in writing that such person
is acquiring the Shares without a view to distribution thereof. The certificates
for such Shares may include any legend which the Committee deems appropriate to
reflect any restrictions on transfer. All certificates for Shares issued
pursuant to the Plan shall be subject to such stock transfer orders and other
restrictions as the Committee may deem advisable under the rules, regulations
and other requirements of the Securities and Exchange Commission, any stock
exchange or interdealer quotation system upon which the Common Stock is then
listed or quoted, and any applicable federal or state securities laws. The
Committee may place a legend or legends on any such certificates to

<PAGE>

make appropriate reference to such restrictions. The certificates for Shares
acquired pursuant to an Option may also include any legend which the Committee
deems appropriate to reflect restrictions contained in this Plan or in the
applicable Agreement or to comply with the Iowa Business Corporation Law.

         16.7. REGULATORY APPROVALS. The Company shall not be required to issue
any certificate or certificates for Shares upon the exercise of Options, or
record any person as a holder of record of such Shares, without obtaining, to
the complete satisfaction of the Committee, the approval of all regulatory
bodies deemed necessary by the Committee, and without complying to the
Committee's complete satisfaction, with all rules and regulations, under
federal, state or local law deemed applicable by the Committee.

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