American Equity Investment Life Holding Company (NYSE: AEL) (“American
Equity” or the “Company”), a leading underwriter of index and fixed rate
annuities, announced today that it intends to commence exchange offers
to purchase for cash and, in certain circumstances, newly issued shares
of its common stock, any and all of its $200,000,000 principal amount of
outstanding 3.50% Convertible Senior Notes due 2015 (the “2015 Notes”)
and any and all of its $115,839,000 principal amount of outstanding
5.25% Contingent Convertible Senior Notes due 2029 (the “2029 Notes”
and, with the 2015 Notes, the “Notes”). These exchange offers (each an
“Exchange Offer” and, collectively, the “Exchange Offers”) are being
made upon the terms and subject to the conditions set forth in the
Company’s Preliminary Prospectuses, dated August 23, 2013, and the
related Letters of Transmittal. The Exchange Offers will expire at 12:00
midnight, New York City time, at the end of October 21, 2013, unless
extended or earlier terminated by the Company (as such may be extended,
the “Expiration Date”).
THE 2015 NOTES OFFER CONSIDERATION
Upon the terms and subject to the conditions of the Exchange Offer
relating to the 2015 Notes, holders of the 2015 Notes who validly tender
and do not validly withdraw their 2015 Notes prior to 12:00 midnight,
New York City time, at the end of the Expiration Date will receive, for
each $1,000 principal amount of the 2015 Notes accepted for exchange,
2015 Notes Offer Consideration equal to (i) $143.92 plus (ii)
ninety-five percent (95%) of the product of the Average VWAP (as defined
herein) multiplied by 80.9486 (the “2015 Notes Offer Consideration”).
The 2015 Notes Offer Consideration will be paid by a cash payment of up
to $1,150 per $1,000 principal amount of 2015 Notes accepted for
exchange in the Exchange Offer relating to the 2015 Notes. In the event
that the 2015 Notes Offer Consideration exceeds $1,150, the 2015 Notes
Offer Consideration will be paid by delivery of (i) a cash payment of
$1,150 per $1,000 principal amount of 2015 Notes accepted for exchange
in the Exchange Offer relating to the 2015 Notes and (ii) a number of
shares of the Company’s common stock equal to the quotient of the total
value of the 2015 Notes Offer Consideration less the $1,150 cash
payment, divided by the Average VWAP. Cash will be paid in lieu of
fractional shares based upon the Average VWAP. In no event will the
total value of the 2015 Notes Offer Consideration paid in the Exchange
Offer relating to the 2015 Notes be less than $1,150 per $1,000
principal amount of 2015 Notes accepted for exchange in the Exchange
Offer relating to the 2015 Notes. In addition, holders whose 2015 Notes
are accepted for exchange will be entitled to receive a cash payment for
accrued and unpaid interest on the 2015 Notes to, but excluding, the
settlement date for such Exchange Offer.
THE 2029 NOTES OFFER CONSIDERATION
Upon the terms and subject to the conditions of the Exchange Offer
relating to the 2029 Notes, holders of the 2029 Notes who validly tender
and do not validly withdraw their 2029 Notes prior to 12:00 midnight,
New York City time, at the end of the Expiration Date will receive, for
each $1,000 principal amount of the 2029 Notes accepted for exchange,
2029 Notes Offer Consideration equal to (i) $159.38 plus (ii)
ninety-five percent (95%) of the product of the Average VWAP multiplied
by 104.4932 (the “2029 Notes Offer Consideration”). The 2029 Notes Offer
Consideration will be paid by a cash payment of up to $1,500 per $1,000
principal amount of 2029 Notes accepted for exchange in the Exchange
Offer relating to the 2029 Notes. In the event that the 2029 Notes Offer
Consideration exceeds $1,500, the 2029 Notes Offer Consideration will be
paid by delivery of (i) a cash payment of $1,500 per $1,000 principal
amount of Notes accepted for exchange in the Exchange Offer relating to
the 2029 Notes and (ii) a number of shares of the Company’s common stock
equal to the quotient of the total value of the 2029 Notes Offer
Consideration less the $1,500 cash payment, divided by the Average VWAP.
Cash will be paid in lieu of fractional shares based upon the Average
VWAP. In no event will the total value of the 2029 Notes Offer
Consideration paid in the Exchange Offer relating to the 2029 Notes be
less than $1,500 per $1,000 principal amount of 2029 Notes accepted for
exchange in the Exchange Offer relating to the 2029 Notes. In addition,
holders whose 2029 Notes are accepted for exchange will be entitled to
receive a cash payment for accrued and unpaid interest on the 2029 Notes
to, but excluding, the settlement date for such Exchange Offer.
The “Average VWAP” means the sum of the Daily VWAPs (as defined below)
for each day of the Averaging Period (as defined below), divided by 40.
The “Averaging Period” means the period of 40 consecutive trading days
beginning on the thirty-ninth trading day preceding the Expiration Date
and ending on the Expiration Date. The “Daily VWAP” for any trading day
means the per share volume-weighted average price of our common stock on
the NYSE, calculated as described in the Prospectuses.
The Company will announce the final 2015 Notes Offer Consideration and
the final 2029 Notes Offer Consideration no later than 4:30 p.m., New
York City Time, on the Expiration Date by press release and at the
website www.gbsc-usa.com/american-equity.
Throughout the Exchange Offers, an indicative 2015 Notes Offer
Consideration and an indicative 2029 Notes Offer Consideration will be
available at www.gbsc-usa.com/american-equity
and from the Information Agent at one of its telephone numbers listed
below.
INFORMATION ON THE EXCHANGE OFFERS
J.P. Morgan Securities and Raymond James & Associates, Inc. will act as
dealer managers (the “Dealer Managers”) in connection with the Exchange
Offers. Global Bondholder Services Corporation will act as the exchange
agent (the “Exchange Agent”) and information agent (the “Information
Agent”) for the Exchange Offers. Questions regarding the Exchange Offers
should be directed to J.P. Morgan Securities LLC at (800) 261-5767 and
to Raymond James & Associates, Inc. at (727) 567-2400. Requests for
copies of the Preliminary Prospectuses, the final Prospectus, when
available, and the Letters of Transmittal may be directed to Global
Bondholder Services Corporation by phone at (212) 430-3774 (for banks
and brokers) and 866-924-2200 (for all other callers) or in writing at
65 Broadway, Suite 404, New York, New York 10006.
This press release is for information purposes only and shall not
constitute an offer to purchase, a solicitation of an offer to purchase,
or an offer to sell or solicitation of an offer to sell any securities.
The Company is making the Exchange Offers only by, and pursuant to, the
terms and conditions of the Prospectuses, the Letters of Transmittal and
the other materials related to the Exchange Offers. No shares of common
stock may be issued nor may any Notes be accepted for exchange in an
Exchange Offer prior to the time the registration statement related to
such Exchange Offer has been declared effective. The Exchange Offers are
subject to certain conditions, as more fully explained in the
Prospectuses and the Letters of Transmittal, both of which will be
distributed to all applicable holders of the Notes. American Equity
expressly reserves the right to waive these conditions in whole or in
part at any or at various times in its sole discretion. None of the
Company, its management or board of directors, the Dealer Managers, the
Exchange Agent or the Information Agent makes any recommendation to any
holder of Notes as to whether tender any Notes in the applicable
Exchange Offer.
The Exchange Offers are not being made in any jurisdiction in which the
making or acceptance thereof would not be in compliance with the
securities, blue sky or other laws of such jurisdiction.
The securities offered in the Exchange Offers may not be sold nor may
offers to buy be accepted prior to the time the applicable Registration
Statement becomes effective. A Registration Statement on Form S-4, which
includes the Preliminary Prospectus and the Letter of Transmittal,
relating to each Exchange Offer and the securities offered thereby has
been filed with the Securities and Exchange Commission but has not yet
become effective. Holders of Notes are encouraged to read the
Registration Statement relating to the applicable Exchange Offer,
including the applicable Preliminary Prospectus (and the final
Prospectus when available), and the exhibits to those filings, including
the applicable Letter of Transmittal, carefully before making any
decision with respect to the applicable Exchange Offer because they
contain important information. The Registration Statements, Preliminary
Prospectuses, (when available final Prospectuses), Letters of
Transmittal and other materials related to the Exchange Offers,
including the related Tender Offer Statements on Schedule TO, can be
obtained free of charge at www.sec.gov
or from the Company at (515) 273-3602.
CAUTION REGARDING FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements. Forward-looking
statements typically are identified by the use of terms such as
“anticipate,” “believe,” “plan,” “estimate,” “expect,” “project,”
“intend,” “may,” “will,” “would,” “contemplate,” “possible,” “attempt,”
“seek,” “should,” “could,” “goal,” “target,” “on track,” “comfortable
with,” “optimistic” and similar words, although some forward-looking
statements are expressed differently. Investors should consider
statements that contain these words carefully because they describe the
Company’s expectations, plans, strategies and goals and the Company’s
beliefs concerning future business conditions, the Company’s results of
operations, financial position, and the Company’s business outlook or
they state other “forward-looking” information based on currently
available information. The “Risk Factors” section of the Company’s
Annual Report on Form 10-K for the year ended December 31, 2012, filed
with the SEC on March 7, 2013, provides examples of risks, uncertainties
and events that could cause the Company’s actual results to differ
materially from the expectations expressed in the Company’s
forward-looking statements. Forward-looking statements speak only as of
the date the statement was made and the Company undertakes no obligation
to update such forward-looking statements. There can be no assurance
that other factors not currently anticipated by the Company will not
materially and adversely affect the Company’s results of operations.
Investors are cautioned not to place undue reliance on any
forward-looking statements made by the Company or on the Company’s
behalf.
ABOUT AMERICAN EQUITY
American Equity Investment Life Holding Company, through its
wholly-owned operating subsidiaries, is a full service underwriter of
fixed annuity and life insurance products, with a primary emphasis on
the sale of index and fixed rate annuities. American Equity Investment
Life Holding Company, a New York Stock Exchange Listed company (NYSE:
AEL), is headquartered in West Des Moines, Iowa.
Copyright Business Wire 2013