Document:

Exhibit 10.6

 

AMERICAN
EQUITY INVESTMENT

2001 NMO DEFERRED STOCK COMPENSATION PLAN

 

WHEREAS, the Board of
Directors of American Equity Investment Life Holding Company (the “Company”) deems it in the best interest of
the Company and its subsidiary, American Equity Investment Life Insurance
Company (“American Equity”), that
certain agents and brokers who solicit business on behalf of the Company and
American Equity 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 establishing a
deferred stock compensation plan pursuant to which agents and brokers meeting
certain production goals can earn credits payable in Common Stock of the
Company;

 

NOW, THEREFORE, the Board does
hereby adopt this 2001 NMO Deferred Stock Compensation Plan, subject to the
terms and conditions hereinafter set forth.

 

ARTICLE I

GENERAL

 

1.01         Purpose.  The American Equity Investment 2001 NMO
Deferred Stock Compensation Plan (the “Plan”)
is intended to advance the interests of the Company and its agency force by
encouraging and enabling selected agents and brokers meeting certain production
goals to earn credits payable in Common Stock of the Company.

 

1.02         Definitions.

 

(a)           “Board” means the Board of Directors of the Company.

 

(b)           “Common Stock” means shares of common stock,
$1 par value, of the Company.

 

(c)           “Deferred Stock Account” shall mean a
bookkeeping entry made by the Company on its books of account which reflects
the value of the Stock Credits earned by each NMO hereunder. Each NMO shall
have a separate Deferred Stock Account.

 

(d)           “NMO” shall mean each  agent or broker who,
at all times during the Qualification Period, has an agency agreement with
American Equity under which the agent or broker is classified as a National
Marketing Organization within American Equity’s hierarchy of agents.

 

(e)           “Participant” shall mean an NMO which meets
the eligibility requirements set forth in Article II below.

 

(f)            “Production” shall
mean the total amount of first year annuity premiums on new annuity policies of
American Equity produced by or through an NMO.

 

(g)           “Qualification Period” shall mean the 12-month period
beginning on January 1, 2001 and ending on December 31, 2001.

 

1

 

(h)           “Stock
Credit” shall mean the right to receive shares of Common Stock at the time specified
for distribution thereof in Article IV below. Stock Credits shall be
distributed at the rate of one share of Stock per each $29.00 in Stock Credits
earned by a Participant under this Plan.

 

(i)            “Vesting
Period” shall mean the four-year period beginning January 1, 2002 and ending
on December 31, 2005.

 

ARTICLE II

ELIGIBILITY

 

An NMO shall be a
Participant under this Plan if, and so long as, such NMO satisfies all of the
eligibility requirements set forth in this Article II:

 

2.01           Valid NMO Contract.    On January 1,
2001, the NMO must have a valid NMO agency agreement with American Equity under
which no default or other event of termination has occurred prior to that date.

 

2.02           Minimum Production.    During the
Qualification Period, the NMO must have Production of at least Twenty-Five
Million Dollars ($25,000,000).

 

ARTICLE III

AWARDS OF STOCK CREDITS

 

3.01           Stock Credits to Deferred
Stock Account.   A Participant shall receive Stock Credits based upon
the following formula:

 

	
  Stock
  Credits =

  	
   

  	
  Participant’s Total Production during the
  Qualification Period

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Multiplied
  by

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  One (1) basis point for every
  million dollars of paid annuity premium produced during the qualification
  period. Minimum premium is $25 million for 25 basis points and maximum is 50
  basis points on $50 million and above.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Example: $25 million earns 25 basis points
  on full $25 million, $50 million earns 50 basis points on full $50 million.

  

 

3.02           Initial
Vesting.   A Participant who satisfies the Minimum Production
requirements set forth in Article II above shall become vested in his
Deferred Stock Account to the extent of twenty-five percent (25%) on January 1,
2001.

 

3.03         Vesting Period – Production Requirements.   A Participant who
has at least Twenty-Five Million Dollars in new Production per calendar year
within the Vesting Period shall become vested in his Deferred Stock Account to
the extent of an additional twenty-five percent (25%) per year for up to three (3) years.

 

2

 

3.04         Automatic
Vesting.  In the event of the Participant’s death or
disability within the Vesting Period, the Participant automatically shall
become One Hundred Percent (100%) vested in Participant’s Deferred Stock
Account. Disability shall be deemed to have occurred upon the written
certification of Participant’s physician that Participant is and will be
permanently and continuously disabled, either mentally or physically, and, as a
result, is unable to carry out Participant’s duties as an NMO of American Equity.

 

3.05         Non-transferability.
No
Stock Credit shall be transferable or assignable by a Participant, otherwise
than by will or the laws of descent and distribution. No Stock Credit shall be pledged or hypothecated in any way and no Stock Credit shall be subject
to execution, attachment or similar process.

 

ARTICLE IV

DISTRIBUTION

 

4.01         Distribution
of Stock.  Within ninety (90) days after the occurrence of the
earlier of the following, the Company will issue and distribute to Participant
or Participant’s designated beneficiary the number of shares of Common Stock
equal to the quotient of the vested portion of the Participant’s Deferred Stock
Account divided by
$                        ,
which is the value per share of the Common Stock as of March 19, 2001.

 

(a)          As determined by the Board of
Directors;

 

(b)         The expiration of five years after the
end of the Vesting Period;

 

(c)          Participant’s death or disability, as
defined above.

 

4.02         Taxation.        Each Participant
and/or Participant’s heirs, executors or administrators shall be responsible
for payment of all taxes of any kind, whenever such taxes may be imposed, on
the value of the Common Stock to which Participant may become entitled under
this Plan.

 

ARTICLE V

MISCELLANEOUS

 

5.01         Independent
Agency Relationship.  Nothing in this Plan shall be interpreted as
changing the independent contractor status of the NMO as to NMO’s relationship
with the Company and American Equity nor shall this Plan be interpreted as
altering in any manner the contractual relationships the NMO has entered into
with the Company separate from this Plan, except as specifically provided
herein.

 

5.02         No Rights to Assets. Nothing in this
Plan shall be interpreted as giving the NMO any rights to any assets of the
Company, including any assets the Company may acquire to assist in funding its
obligations hereunder. The NMO’s status with respect to any amount due NMO
under this Plan from the Company shall be that of a general creditor of the
Company.

 

5.03         Severability. Any provision of
this Plan which shall prove to be invalid, void or illegal shall in no way
affect, impair or invalidate any other provision contained herein, and such
other provisions shall remain in full force and effect.

 

3

 

5.04         Binding
Effect.  This Plan shall be binding upon the parties
hereto, their heirs, assigns. successors, executors and administrators. None of
the payments provided for in this Plan, nor the Deferred Compensation Account,
shall be subject to seizure for payment of any debts or judgments against the
NMO or any beneficiary, nor shall the NMO or any beneficiary have any right to
transfer, modify, anticipate, assign or encumber any rights or benefits
hereunder.

 

5.05         Governing Law.  This Plan shall be
governed and interpreted in accordance with the laws of the State of lowa.

 

5.06         Amendment.  This
Plan may be amended at any time by the Board effective upon written
notification to the Participants of any such amendments. No amendment shall
impair any Participant’s vested rights hereunder.

 

 

	
   

  	
   

  	
  AMERICAN EQUITY INVESTMENT

  
	
   

  	
   

  	
  LIFE HOLDING COMPANY

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  D.
  J. Noble, Chairman & President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  NMO:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  

 

SCHEDULE OF
STOCK CREDIT

PARTICIPATION

 

	
   

  	
   

  	
   

  	
  Percentage of Total

  	
   

  	
   

  	
   

  
	
  Participant’s Name

  	
   

  	
  Stock Credit

  	
   

  	
   

  	
  Participant’s Beneficiary

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Total 

  	
  100

  	
  %

  	
   

  	
   

  
								

 

4Exhibit 10.7

 

AMERICAN
EQUITY INVESTMENT

2000 NMO
DEFERRED STOCK COMPENSATION PLAN

 

WHEREAS, the Board of
Directors of American Equity Investment Life Holding Company (the “Company”) deems it in the best interest of
the Company and its subsidiary, American Equity Investment Life Insurance
Company (“American Equity”), that
certain agents and brokers who solicit business on behalf of the Company and
American Equity 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 establishing a
deferred stock compensation plan pursuant to which agents and brokers meeting
certain production goals can earn credits payable in Common Stock of the
Company;

 

NOW, THEREFORE, the Board does
hereby adopt this 2000 NMO Deferred Stock Compensation Plan, subject to the
terms and conditions hereinafter set forth.

 

ARTICLE I

GENERAL

 

1.01        Purpose.  The American Equity Investment 2000 NMO
Deferred Stock Compensation Plan (the “Plan”)
is intended to advance the interests of the Company and its agency force by
encouraging and enabling selected agents and brokers meeting certain production
goals to earn credits payable in Common Stock of the Company.

 

1.02        Definitions.

 

(a)           “Board” means the
Board of Directors of the Company.

 

(b)           “Common Stock”
means shares of common stock, $1 par value, of the Company.

 

(c)           “Deferred Stock Account”
shall mean a bookkeeping entry made by the Company on its books of account
which reflects the value of the Stock Credits earned by each NMO hereunder.
Each NMO shall have  a separate Deferred
Stock Account.

 

(d)           “NMO” shall mean
each agent or broker who, at all times during the Qualification Period, has an
agency agreement with American Equity under which the agent or broker is
classified as a National Marketing Organization within American Equity’s
hierarchy of agents.

 

(e)           “Participant” shall
mean an NMO which meets the eligibility requirements set forth in Article II
below.

 

(f)            “Production”
shall mean the total amount of first year annuity premiums on new annuity policies of American Equity produced by or through an
NMO.

 

1

 

(g)           “Qualification
Period” shall mean the 12-month period beginning on January 1, 2000 and
ending on December 31, 2000.

 

(h)           “Stock Credit”
shall mean the right to receive shares of Common Stock at the time specified
for distribution thereof in Article IV below. Stock Credits shall be
distributed at the rate of one share of Stock per each $29.00 in Stock Credits
earned by a Participant under this Plan.

 

(i)            “Vesting Period”
shall mean the four-year period beginning January 1, 2001 and ending on December 31,
2004.

 

ARTICLE II

ELIGIBILITY

 

An NMO shall be a
Participant under this Plan if, and so long as, such NMO satisfies all of the
eligibility requirements set forth in this Article II:

 

2.01         Valid NMO Contract.    On
January 1, 2000, the NMO must have a valid NMO agency agreement with
American Equity under which no default or other event of termination has
occurred prior to that date.

 

2.02         Minimum Production.   During the
Qualification Period, the NMO must have Production of at least Twenty-Five
Million Dollars ($25,000,000).

 

ARTICLE III

AWARDS OF STOCK CREDITS

 

3.01         Stock Credits to Deferred
Stock Account.    A Participant shall receive Stock Credits based upon
the following formula:

 

	
  Stock Credits =

  	
   

  	
  Participant’s Total Production during the
  Qualification Period

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
                                       Multiplied
  by

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  One (1) basis point for every million
  dollars of paid annuity premium produced during the qualification period.
  Minimum premium is $25 million for 25 basis points and maximum is 50 basis
  points on $50 million and above.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Example:  $25 million earns 25 basis points on full
  $25 million, $50 million earns 50 basis points on full $50 million.

  

 

3.02         Initial Vesting.   A Participant who
satisfies the Minimum Production requirements set forth in Article Il
above shall become vested in his Deferred Stock Account to the extent of
twenty-five percent (25%) on January 1, 2001.

 

3.03         Vesting Period —  Production Requirements.  A Participant who has at least Twenty-Five  Million Dollars in
new Production per calendar year within the Vesting Period shall become vested
in his Deferred Stock Account to the extent of an additional twenty-five
percent (25%) per year for up to three (3) years.

 

2

 

3.04         Automatic Vesting.    In the event of the
Participant’s death or disability within the Vesting Period, the Participant
automatically shall become One Hundred Percent (100%) vested in Participant’s
Deferred Stock Account. Disability shall be deemed to have occurred upon the
written certification of Participant’s physician that Participant is and will
be permanently and continuously disabled, either mentally or physically, and,
as a result, is unable to carry out Participant’s duties as an NMO of American
Equity.

 

3.05         Non-transferability.    No Stock Credit
shall be transferable or assignable by a Participant, otherwise than by will or
the laws of descent and distribution. No Stock Credit shall be pledged or hypothecated in any
way and no Stock Credit shall be subject to execution, attachment or similar
process.

 

ARTICLE IV

DISTRIBUTION

 

4.01         Distribution of Stock.  Within ninety (90) days after the occurrence of the
earlier of the following, the Company will issue and distribute to Participant
or Participant’s designated beneficiary the number of shares of Common Stock
equal to the quotient of the vested portion of the Participant’s Deferred Stock Account divided by
$29.00, which is the value per share of the Common Stock as of February 28,
2000. As determined by the Board of Directors.

 

(a)           The expiration of
five years after the end of the Vesting Period;

 

(b)           Participant’s death
or disability, as defined above.

 

4.02         Taxation.    Each Participant
and/or Participant’s heirs, executors or administrators shall be responsible for
payment of all taxes of any kind, whenever such taxes may be imposed, on the
value of the Common Stock to which Participant may become entitled under this
Plan.

 

ARTICLE V

MISCELLANEOUS

 

5.01           Independent Agency Relationship.    Nothing in this
Plan shall be interpreted as changing the independent contractor status of the NMO
as to NMO’s relationship with the Company and American Equity nor shall this
Plan be interpreted as altering in any manner the contractual relationships the
NMO has entered into with the Company separate from this Plan, except as
specifically provided herein.

 

5.02         No Rights to Assets.    Nothing
in this Plan shall be interpreted as giving the NMO any rights to any assets of
the Company, including any assets the Company may acquire to assist in funding
its obligations hereunder. The NMO’s status with respect to any amount due NMO
under this Plan from the Company shall be that of a general creditor of the Company.

 

5.03         Severability.  Any provision of this Plan which shall prove
to be invalid, void or illegal shall in no way affect, impair or invalidate any
other provision contained herein, and such other provisions shall remain in
full force and effect.

 

5.04         Binding Effect.    This
Plan shall be binding upon the parties hereto, their heirs, assigns,
successors, executors and administrators. None of the payments provided for in
this Plan, nor the Deferred Compensation Account, shall be subject to seizure
for payment of any debts or judgments against the NMO or any beneficiary, nor shall the NMO or
any beneficiary have any right to transfer, modify, anticipate, assign or
encumber any rights or benefits hereunder.

 

3

 

5.05         Governing Law.    This Plan shall be governed and
interpreted in accordance with the laws of the  State of Iowa.

 

5.06         Amendment.    This
Plan may be amended at any time by the Board effective upon written
notification to the Participants of any such amendments. No amendment shall impair any Participant’s vested
rights hereunder.

 

 

	
   

  	
   

  	
  AMERICAN EQUITY INVESTMENT 

  
	
   

  	
   

  	
  LIFE HOLDING COMPANY

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
  D.J. Noble,
  Chairman & President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  NMO:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  

 

 

SCHEDULE OF
STOCK CREDIT

PARTICIPATION

 

	
   

  	
   

  	
   

  	
  Percentage of Total

  	
   

  	
   

  	
   

  
	
  Participant’s Name

  	
   

  	
  Stock Credit

  	
   

  	
  Participant’s Beneficiary

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Total

  	
  100

  	
  %

  	
   

  	
   

  
								

 

4

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