AEL to be Acquired by Prosperity Life Group for $1.77B

TL;DR

AEL is getting bought by Prosperity Life for $50/share cash, deal worth $1.77B.

AI Summary

On May 7, 2024, American Equity Investment Life Holding Company (AEL) entered into a definitive agreement to be acquired by Prosperity Life Group, LLC for $50.00 per share in cash. This transaction is valued at approximately $1.77 billion and is expected to close in the second half of 2024, subject to regulatory approvals and other customary closing conditions.

Why It Matters

This acquisition represents a significant consolidation in the life insurance sector, potentially impacting market competition and the strategic direction of both companies.

Risk Assessment

Risk Level: medium — The deal is subject to regulatory approvals and other closing conditions, which introduce uncertainty regarding its completion.

Key Numbers

• $1.77B — Transaction Value (Total cash consideration for the acquisition of AEL.)
• $50.00 — Per Share Price (Cash amount each AEL shareholder will receive.)

Key Players & Entities

• American Equity Investment Life Holding Company (company) — Company being acquired
• Prosperity Life Group, LLC (company) — Acquiring company
• $50.00 (dollar_amount) — Per share acquisition price
• $1.77 billion (dollar_amount) — Total transaction value
• May 7, 2024 (date) — Date of definitive agreement
• second half of 2024 (date) — Expected closing period

FAQ

Key Financial Figures

• $1 — ch registered Common stock, par value $1 AEL New York Stock Exchange Depos
• $1,750,000,000 — greement provides for the incurrence of $1,750,000,000 in senior unsecured term loans (the " T
• $1.00 — ve Preferred Stock, Series A, par value $1.00 per share (the " Series A Preferred Sto
• $500 million — strant. On June 13, 2022, ANAT issued $500 million aggregate principal amount of its 6.144
• $371.8750000 — ompany) has declared a cash dividend of $371.8750000 per share of Series A Preferred Stock (
• $0.371875000 — Series A Preferred Stock (equivalent to $0.371875000 per depositary share representing the S
• $414.0625000 — ompany) has declared a cash dividend of $414.0625000 per share of Series B Preferred Stock (
• $0.414062500 — Series B Preferred Stock (equivalent to $0.414062500 per depositary share representing the S
• $0.01 — he Preferred Stock, Series C, par value $0.01 per share (the " Series C Preferred Sto

Filing Documents

• tm2413694d1_8k.htm (8-K) — 60KB
• tm2413694d1_ex2-1.htm (EX-2.1) — 29KB
• tm2413694d1_ex2-2.htm (EX-2.2) — 314KB
• tm2413694d1_ex3-1.htm (EX-3.1) — 36KB
• tm2413694d1_ex3-2.htm (EX-3.2) — 226KB
• tm2413694d1_ex3-3.htm (EX-3.3) — 62KB
• tm2413694d1_ex4-1.htm (EX-4.1) — 522KB
• tm2413694d1_ex4-2.htm (EX-4.2) — 15KB
• tm2413694d1_ex10-1.htm (EX-10.1) — 589KB
• 0001104659-24-058469.txt ( ) — 2458KB
• ael-20240507.xsd (EX-101.SCH) — 3KB
• ael-20240507_def.xml (EX-101.DEF) — 27KB
• ael-20240507_lab.xml (EX-101.LAB) — 37KB
• ael-20240507_pre.xml (EX-101.PRE) — 26KB
• tm2413694d1_8k_htm.xml (XML) — 7KB

01 Entry into a Material Definitive Agreement

Item 1.01 Entry into a Material Definitive Agreement On May 7, 2024 (the " Effective Date "), American Equity Investment Life Holding Company, an Iowa corporation (the " Company "), entered into a new term loan agreement (the " Term Loan Agreement "), among the Company, the lenders from time to time party thereto and Bank of Montreal, as administrative agent. The Term Loan Agreement provides for the incurrence of $1,750,000,000 in senior unsecured term loans (the " Term Loans ") with the potential to incur additional incremental term facilities. The Term Loans will mature on May 25, 2027 and will bear interest as determined in accordance with the Term Loan Agreement. The Term Loan Agreement includes customary representations and warranties, affirmative and negative covenants, and events of default for facilities of this type. The Term Loan includes financial covenants tested at quarter-end related to debt to capitalization and net worth The foregoing description of the Term Loan Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Term Loan Agreement, which is attached hereto as Exhibit 10.1 and is incorporated herein by reference.

02 Termination of a Material Definitive Agreement

Item 1.02 Termination of a Material Definitive Agreement On the Effective Date, the Company repaid in full all indebtedness and other obligations outstanding under, and terminated, the Credit Agreement, dated as of February 15, 2022, among the Company, the lenders party thereto, and Citizens Bank, N.A., as administrative agent.

01 Completion of Acquisition or Disposition of Assets

Item 2.01 Completion of Acquisition or Disposition of Assets On the Effective Date, the Company, completed its previously announced merger with American National Group, LLC, a Delaware limited liability company (" ANAT ") and an indirect, wholly-owned subsidiary of Brookfield Reinsurance Ltd. (" Brookfield Reinsurance "). Pursuant to the Agreement and Plan of Merger, dated as of May 7, 2024, by and among the Company and ANAT (the " Merger Agreement "), ANAT merged with and into the Company (the " Merger ") in accordance with the Iowa Business Corporation Act (the " IBCA "), with the Company surviving the Merger as an indirect wholly-owned subsidiary of Brookfield Reinsurance (such entity, the " Iowa Surviving Company "). In connection with the Merger, the Iowa Surviving Company adopted an amendment to its articles of incorporation, a copy of which is filed herewith as Exhibit 3.1 and is incorporated herein by reference, and became the successor issuer of ANAT's preferred shares designated as "Preferred Stock, Series C". The Company's issued and outstanding shares of 5.95% Fixed-Rate Reset Non-Cumulative Preferred Stock, Series A, par value $1.00 per share (the " Series A Preferred Stock ") and 6.625% Fixed-Rate Reset Non-Cumulative Preferred Stock, Series B, par value $1.00 per share (the " Series B Preferred Stock ") were unaffected by the Merger and remain outstanding. Depositary receipts for the Series A Preferred Stock and Series B Preferred Stock are listed on the New York Stock Exchange under the ticker symbols "AELPRA" and "AELPRB", respectively. Following the Reincorporation (as defined below) ticker symbols will change, as described under Item 8.01 of this Current Report on Form 8-K. The foregoing description of the Merger Agreement and the Merger does not purport to be complete and is subject to and qualified in its entirety by reference to the Merger Agreement, a copy of which is filed herewith as Exhibit 2.1 and is incorporated herein by reference.

03 Creation of a Direct Financial Obligation or an Obligation

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. On June 13, 2022, ANAT issued $500 million aggregate principal amount of its 6.144% Senior Notes due 2032 (the " 2032 Notes ") pursuant to an Indenture, dated as of June 13, 2022 (the " Base Indenture "), by and between ANAT and Wilmington Trust, National Association, as trustee (the " Trustee "). As required by the Base Indenture, in connection with the consummation of the Merger, on the Effective Date, the Iowa Surviving Company and the Trustee entered into a First Supplemental Indenture (the " First Supplemental Indenture ") to reflect that the Iowa Surviving Company, as successor to ANAT, expressly assumed all of ANAT's obligations under the 2032 Notes and the Base Indenture. The 2032 Notes bear interest at a rate of 6.144% per annum and mature on June 13, 2032. Interest on the 2032 Notes is payable in arrears on June 13 and December 13 of each year. The 2032 Notes are the Iowa Surviving Company's general unsecured obligations which rank equally in right of payment with all of the Iowa Surviving Company's unsecured and unsubordinated indebtedness from time to time outstanding. The 2032 Notes are not guaranteed. The 2032 Notes are redeemable, at the Iowa Surviving Company's option, in whole or in part, (a) at any time prior to March 13, 2032 (the date that is three months prior to the scheduled maturity date), at the applicable make-whole redemption price specified in the Base Indenture, and (b) at any time on or after March 13, 2032 and prior to maturity, at par, plus, in the case of each of clauses (a) and (b), accrued and unpaid interest thereon to, but excluding, the redemption date. The Base Indenture contains certain covenants that, among other things, limit the ability of the Iowa Surviving Company to incur secured indebtedness and to consummate a merger, consolidation or sale of all or substantially all of its assets. These co

03 Amendments to Articles of Incorporation or Bylaws; Change

Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year. The information set forth under Item 2.01 and

01 of this Current Report on Form 8-K is incorporated in this Item 5.03 by reference

Item 8.01 of this Current Report on Form 8-K is incorporated in this Item 5.03 by reference.

01 Regulation FD

Item 7.01 Regulation FD. The information set forth under Item 2.01 of this Current Report on Form 8-K is incorporated in this Item 7.01 by reference. In accordance with the terms of the Series A Preferred Stock, the Board of Directors of American National Group Inc. (as the successor entity to the Company) has declared a cash dividend of $371.8750000 per share of Series A Preferred Stock (equivalent to $0.371875000 per depositary share representing the Series A Preferred Stock). The dividend will be payable on June 1, 2024 to shareholders of Series A Preferred Stock of record as of May 17, 2024. Additionally, in accordance with the terms of the Series B Preferred Stock, the Board of Directors of American National Group Inc. (as the successor entity to the Company) has declared a cash dividend of $414.0625000 per share of Series B Preferred Stock (equivalent to $0.414062500 per depositary share representing the Series B Preferred Stock). The dividend will be payable on June 1, 2024 to shareholders of Series B Preferred Stock of record as of May 17, 2024.

01 Other Events

Item 8.01 Other Events. On the Effective Date, following the completion of the Merger, pursuant to a Plan of Domestication, dated as of May 7, 2024 (the " Plan of Domestication "), the Iowa Surviving Company discontinued its existence as an Iowa Corporation as provided under IBCA, including Section 931 of the IBCA, and, pursuant to the General Corporation Law of the State of Delaware (the "DGCL"), including Section 388 of the DGCL, continued its existence under the DGCL as a corporation incorporated in the State of Delaware (the " Reincorporation ", and such corporation, the " Delaware Surviving Company "). In connection with the Reincorporation, the Delaware Surviving Company changed its name from American Equity Investment Life Holding Company to American National Group Inc. and adopted a new certificate of incorporation (the " Certificate of Incorporation ") and bylaws, copies of which are filed herewith as Exhibits 3.2 and 3.3, respectively, and are incorporated herein by reference. The Certificate of Incorporation and bylaws of American National Group Inc. are effective as of the Effective Date. Each share of each of the Series A Preferred Stock, the Series B Preferred Stock and the Preferred Stock, Series C, par value $0.01 per share (the " Series C Preferred Stock ") of the Iowa Surviving Company outstanding immediately prior to the Reincorporation was automatically converted into an equivalent share of Series A Preferred Stock, Series B Preferred Stock or Series C Preferred Stock, respectively, of the Delaware Surviving Company. The terms, rights, restrictions and qualifications of the Series A Preferred Stock, which were unaffected by the Merger and the Reincorporation, are set forth on Exhibit A to the Certificate of Incorporation. The terms, rights, restrictions and qualifications of the Series B Preferred Stock, which were unaffected by the Merger and the Reincorporation, are set forth on Exhibit B to the Certificate of Incorporation. The terms, right

01 Exhibits

Item 9.01 Exhibits. (d) Exhibits Exhibit No. Description 2.1 Agreement and Plan of Merger, dated May 7, 2024, between American Equity Investment Life Holding Company and American National Group, LLC. 2.2 Plan of Domestication, dated May 7, 2024. 3.1 Articles of Amendment to the Articles of Incorporation of American Equity Investment Life Holding Company. 3.2 Certificate of Incorporation of American National Group Inc. 3.3 Bylaws of American National Group Inc. 4.1 Indenture, dated as of June 13, 2022, by and between American National Group, LLC (formerly known as American National Group, Inc.) and Wilmington Trust, National Association, as trustee 4.2 First Supplemental Indenture, dated as of May 7, 2024, by and between American Equity Investment Life Holding Company and Wilmington Trust, National Association, as trustee 4.3 Form of Note representing the 6.144% Notes due 2032 (included in Exhibit 4.1) 10.1 Term Loan Agreement, dated May 7, 2024, among American Equity Investment Life Holding Company, the lenders party thereto and Bank of Montreal, as administrative agent. 104 Cover Page Interactive Data File – the cover page XBRL tags are embedded within the Inline XBRL document SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. AMERICAN NATIONAL GROUP INC. Date: May 7, 2024 By: /s/ Garrett Williams Garrett Williams Corporate Secretary and Senior Vice President

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