SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement
[X] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
FBL FINANCIAL GROUP, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transactions applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11. (Set forth the amount on which the
filing fee is calculated and state how it was determined.)
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount previously paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing party:
(4) Date filed:
<PAGE>
FBL FINANCIAL GROUP, INC.
5400 UNIVERSITY AVENUE
WEST DES MOINES, IOWA 50266
March 30, 1999
Dear Stockholder:
You are cordially invited to attend the Company's 1999 annual meeting to be
held on Tuesday, May 18, 1999 at 9:00 a.m. central time, in the auditorium of
the Company's home office building, 5400 University Avenue, West Des Moines,
Iowa.
The notice of meeting and proxy statement following this letter describe
the business expected to be transacted at the meeting. During the meeting we
will also report on the current activities of the Company, and you will have an
opportunity to ask questions.
Whether or not you plan to attend this meeting, we urge you to sign and
date the enclosed proxy card and return it as soon as possible so that your
shares will be represented. The vote of every stockholder is important. Please
note that mailing your completed proxy will not prevent you from voting in
person at the meeting if you wish to do so.
Your Board of Directors and management look forward to greeting personally
those stockholders who are able to attend.
Sincerely,
/s/ Edward M. Wiederstein /s/ Thomas R. Gibson
Edward M. Wiederstein Thomas R. Gibson
CHAIRMAN OF THE BOARD CHIEF EXECUTIVE OFFICER
<PAGE>
FBL FINANCIAL GROUP, INC.
5400 UNIVERSITY AVENUE
WEST DES MOINES, IOWA 50266
MARCH 30, 1999
Richard D. Harris
Senior Vice President,
Treasurer and Secretary
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
The annual meeting of stockholders of FBL Financial Group, Inc. (the
"Company"), will be held in the auditorium of the Company's home office
building, 5400 University Avenue, West Des Moines, IA 50266 on Tuesday, May 18,
1999, at 9:00 a.m. central time, for the following purposes:
1. For the holders of Class A Common Stock and Preferred Stock, Series B,
voting as a single class, to elect three Class A directors;
2. For the holders of Class B Common Stock to elect 18 Class B directors;
3. For the holders of Class A Common Stock to vote on the recommendation
of the Board of Directors that the Bylaw Section 3.6(c) be amended.
4. For all holders of Class A Common Stock, Class B Common Stock and
Preferred Stock, Series B to vote on the recommendation of the Board
of Directors that Ernst & Young LLP be appointed auditors of the
Company for 1999; and
5. To transact such other business as may properly come before the
meeting.
By Order of the Board of Directors
/s/ Richard D. Harris
Richard D. Harris
SECRETARY
<PAGE>
FBL FINANCIAL GROUP, INC.
-----------------
PROXY STATEMENT
MARCH 30, 1999
-----------------
This proxy statement is furnished in connection with the solicitation of
proxies on behalf of the Board of Directors of FBL Financial Group, Inc. for
the annual meeting of stockholders to be held on May 18, 1999. Only
stockholders of record at the close of business on March 19, 1999 are entitled
to notice of and to vote at the meeting. There were 31,454,075 Class A Common
Shares, 1,192,990 Class B Common Shares and 5,000,000 Preferred Shares, Series
B, outstanding and entitled to vote on that date. Each common stockholder will
be entitled to one vote per share on each matter to be voted on, and each
preferred stockholder will be entitled to two votes per share on each matter to
be voted on. The holders of Class A Common Shares and Preferred Shares, Series
B, vote together as a group to elect Class A Directors, and the holders of
Class B Common Shares vote to elect Class B Directors. The holders of shares
representing a majority of the total number of votes entitled to be cast,
present in person or represented by proxy, constitute a quorum for the
transaction of business.
The Company is mailing its annual report for the year ended December 31,
1998 together with this proxy statement and the enclosed proxy on or about March
30, 1999, to stockholders entitled to vote at the annual meeting.
When you sign and return the enclosed proxy, the shares represented thereby
will be voted for the nominees for director of the respective class listed in
this proxy statement, and for the proposals set forth in Items 2 and 3 in the
Notice of Meeting, unless otherwise indicated on the proxy. Returning your
completed proxy will not prevent you from voting in person at the meeting should
you be present and wish to do so. In addition, you may revoke your proxy any
time before it is voted by sending notice to the Secretary of the Company prior
to the meeting. If you submit more than one proxy, each later-dated proxy will
revoke all previous proxies.
The Board of Directors expects all nominees named below to be available for
election. In case any nominee is not available, the proxy holders may vote for a
substitute. Regulations of the Securities and Exchange Commission permit the
proxies solicited pursuant to the proxy statement to confer discretionary
authority with respect to matters on which the Company did not know a reasonable
time before the meeting, or which were omitted from the proxy statement and form
of proxy pursuant to Securities and Exchange Commission rules. Accordingly, the
proxy holders may use their discretionary authority to vote with respect to any
such matter pursuant to the proxy solicited hereby.
Directors of each class will be elected at the annual meeting by a majority
of the votes of such class cast at the meeting by the holders of shares
represented in person or by proxy and entitled to vote. Approval of the proposed
Bylaws amendment, and approval of the appointment of independent auditors,
requires the affirmative vote of the holders of shares representing a majority
of votes to be cast, represented in person or by proxy at the meeting and
entitled to vote. With respect to the election of
1
<PAGE>
directors, votes may be cast in favor of or withheld from each nominee; votes
that are withheld or abstained, and broker non-votes, will be excluded entirely
from the vote and will have no effect except to determine the existence of a
quorum. Abstentions may be specified on all other proposals and will be counted
as shares present for determination of a quorum, and will have the effect of a
negative vote on the item voted upon. Broker non-votes with respect to approval
of the Bylaws amendment and appointment of independent auditors will not be
counted in determining the amount of shares voted on such items and will have no
effect on the outcome of the vote on the items.
ITEM 1:
ELECTION OF DIRECTORS
The terms of all directors will expire at this Annual Meeting. No person,
other than the directors of the Corporation acting solely in that capacity, is
responsible for the naming of the nominees for Class A Director. A person who
is an employee, officer or director of a holder of Class B shares or of any
other Farm Bureau organization is not eligible to be elected as a Class A
Director. Nomination and election of the Class B Directors by the holders of
the Class B shares is subject to the provisions of the Class B Common
Stockholder Agreement. The Class B Common Stockholder Agreement obligates the
holders of Class B shares to elect the Presidents of the 15 state Farm Bureau
federations which own, or whose affiliates own the Class B shares, as Class B
Directors. The Class B Common Stockholder Agreement also obligates the holders
of Class B shares to cause the election of the President of the Iowa Farm
Bureau Federation as Chairman of the Board and to elect the Chief Executive
Officer of the Company and two other officers of the Company nominated by the
Chairman of the Board as Class B Directors.
Information as to each nominee follows. Unless otherwise indicated, each
nominee has served for at least five years in the business position currently
or most recently held.
NOMINEES FOR CLASS A DIRECTOR
JERRY L. CHICOINE is a Class A Director of the Company. He became Executive
Vice President and Chief Operating Officer of Pioneer Hi-Bred International,
Inc. (seed corn business) in September 1997, after serving as Senior Vice
President and Chief Financial Officer since 1990, and was named a director of
Pioneer Hi-Bred in March 1998. Mr. Chicoine was Senior General Counsel of
Pioneer Hi-Bred International, Inc. from 1986 to 1988. Prior thereto he was a
partner in the accounting firm of McGladrey & Pullen from 1969 to 1986. Mr.
Chicoine is a lawyer and a certified public accountant. He is also a member of
the board of directors of Des Moines Export Council, Edge Technologies, Inc. and
Iowa Health Systems.
MEMBER: Audit, Budget, and Compensation Committees
DIRECTOR SINCE 1996 AGE: 56
2
<PAGE>
JOHN W. CREER is a Class A Director of the Company. Since 1980, he has been
President and Chief Executive Officer of the Farm Management Company, the
agricultural real estate holding and management company wholly owned by the
Church of Jesus Christ of Latter-day Saints (Mormon). As such he is responsible
for management of a substantial multi-national resource. He is also Secretary of
the worldwide church's Investment Policy Committee. Mr. Creer is a lawyer and
received a doctorate of laws degree from the University of Munich.
MEMBER: Audit, Budget, and Class A Directors Nominating Committees
DIRECTOR SINCE 1996 AGE: 59
JOHN E. WALKER is a Class A Director of the Company. Mr. Walker retired
January 1, 1996 from Business Men's Assurance (BMA), Kansas City, Missouri,
where he had been the Managing Director of Reinsurance Operations since 1979. He
had been a member of the board of directors of BMA for 11 years before his
retirement, and a member of its executive committee. Mr. Walker is also a
director and member of the Audit Committee of LabOne, Inc., Lenexa, Kansas, a
publicly traded blood and urine testing business.
MEMBER: Audit, Compensation, and Class A Nominating Committees
DIRECTOR SINCE 1996 AGE: 60
NOMINEES FOR CLASS B DIRECTOR
EDWARD M. WIEDERSTEIN is the Chairman of the Board and a Class B Director
of the Company. He has been a director of the Iowa Farm Bureau Federation since
1986 and in 1995 was elected President of the Iowa Farm Bureau Federation. Mr.
Wiederstein was elected a director of American Farm Bureau Federation in January
1999, and of Farm Bureau BanCorp in December 1998. He is also a director and
president of Farm Bureau Mutual Insurance Company (Farm Bureau Mutual), Farm
Bureau Life Insurance Company (Farm Bureau Life), Western Farm Bureau Life
Insurance Company (Western Farm Bureau Life) and EquiTrust Life Insurance
Company (EquiTrust Life), and a director of Western Agricultural Insurance
Company (Western Ag). Mr. Wiederstein owns and operates a 1,200 acre farm near
Audubon, Iowa where he has been engaged in the business of cattle and hog
feeding and grain farming since 1973. He is also a director of American Farm
Bureau Insurance Services, Inc. and of Wellmark, Inc.
MEMBER: Executive and Compensation Committees
DIRECTOR SINCE 1995 AGE: 50
THOMAS R. GIBSON, FSA, CLU, FLMI, is the Chief Executive Officer of the
Company and of its major operating subsidiaries and a Class B Director of the
Company. Mr. Gibson is also a director of AccessAir Holdings, Inc. Mr. Gibson
has been employed by the Company and its affiliates since 1966.
MEMBER: Executive and Investment Committees
DIRECTOR SINCE 1996 AGE: 54
RICHARD D. HARRIS is Senior Vice President, Secretary and Treasurer of the
Company and its major operating subsidiaries and a Class B Director of the
Company. He is Executive Director, Secretary and Treasurer of the Iowa Farm
Bureau Federation; Senior Vice President and Assistant Secretary and Treasurer
of South Dakota Mutual Insurance Company (South Dakota Mutual), and Vice
President and Treasurer of Farm Bureau Management Corporation (Management
Corp.), a subsidiary of the Iowa Farm Bureau Federation. He was elected to all
of those positions effective September 1, 1996. Mr. Harris has been employed by
the Company and its affiliates since 1996, and by the Iowa Farm Bureau
Federation since 1968.
MEMBER: Executive and Investment Committees
DIRECTOR SINCE 1996 AGE: 54
3
<PAGE>
STEPHEN M. MORAIN is Senior Vice President and General Counsel of the
Company and a Class B Director. He also serves as General Counsel and Assistant
Secretary of the Iowa Farm Bureau Federation; General Counsel, Secretary and
director of Management Corp.; and Senior Vice President and General Counsel of
the Company's major operating subsidiaries. Mr. Morain is also a director of
Computer Aided Design Software, Inc., a director of Iowa Business Development
Finance Corporation, chairman and a director of Edge Technologies, Inc., and a
director and Secretary of the Iowa Agricultural Finance Corporation. Mr. Morain
has been employed by the Company and its affiliates since 1977.
MEMBER: Executive and Investment Committees
DIRECTOR SINCE 1996 AGE: 53
ROGER BILL MITCHELL is a Class B Director and the First Vice Chair of the
Company. He has been President of the Colorado Farm Bureau since 1991. He is a
director of Farm Bureau BanCorp. Mr. Mitchell is also First Vice President of
Western Life, President and director of Colorado Farm Bureau Mutual Insurance
Company, director of Western Ag and a member of the Colorado Water Quality
Control Commission. Mr. Mitchell is managing general partner of Mitchell Ag
Production, a family limited partnership with his two sons, which is a ten
quarter potato and barley farming operation in the San Luis Valley of south
central Colorado.
MEMBER: Budget Committee
DIRECTOR SINCE 1994 AGE: 54
KAREN J. HENRY is a Class B Director and the Second Vice Chair of the
Company. She was elected as President of the Wyoming Farm Bureau Federation in
1994, after having served as a director since 1992. Ms. Henry is a director and
President of Mountain West Farm Bureau Mutual Insurance Company and a director
of Western Life and of Western Ag. She is involved in a family ranch and cattle
operation.
DIRECTOR SINCE 1995 AGE: 52
KENNETH R. ASHBY is a Class B Director of the Company and has been the
President of the Utah Farm Bureau Federation since November 1986. He is a
director of Farm Bureau BanCorp. He has been a director and Vice President of
Utah Farm Bureau Insurance Company and a director of Farm Bureau Life. Mr. Ashby
has been President and General Manager of Ashby's Valley View Farms since
September 1966.
MEMBER: Class A Directors Nominating Committee
DIRECTOR SINCE 1994 AGE: 58
AL CHRISTOPHERSON is a Class B Director of the Company. He has been
President of the Minnesota Farm Bureau Federation since December 1988 and is
also a director of Farm Bureau Mutual and American Ag. Mr. Christopherson is
also a director of the American Farm Bureau Federation and serves on a number of
agricultural boards including the Agricultural Utilization and Research
Institute. Mr. Christopherson is a diversified grain and livestock farmer from
Pennock, Minnesota, where he operates an 1,800 acre family farm, raising hogs,
corn, soybeans, and wheat.
MEMBER: Compensation Committee
DIRECTOR SINCE 1994 AGE: 58
4
<PAGE>
KENNY J. EVANS is a Class B Director of the Company. He is President and a
director of the Arizona Farm Bureau Federation. Mr. Evans, a farmer, corporate
executive and business owner, is also a former Chairman of the National
Agricultural Labor Advisory Committee and a former Chairman of the Arizona
Commission of Agriculture and Horticulture. He is a director of Western Life and
a director and President of Western Ag. Mr. Evans is also a director of American
Farm Bureau Federation and of Farm Bureau BanCorp.
MEMBER: Budget Committee
DIRECTOR SINCE 1994 AGE: 53
JACK M. GIVENS is a Class B Director of the Company. He was elected in
January 1998 after becoming President of the Oklahoma Farm Bureau Federation and
its insurance affiliates, of which he has been a director since 1988. Mr. Givens
is a Regent of Oklahoma State University and A&M Colleges, a director of Cotton
Incorporated, New York, NY, a director of Oklahoma Baptist University National
Board of Development, a director of Oklahoma Medical Research Foundation, a
director of Oklahoma Cotton Growers Association and a director of the Oklahoma
Art Institute. He is also a director of Farm Bureau BenCorp. He is a director of
Western Life and of Western Ag. Mr. Givens has farming and ranching operations
in Jackson, Greer and Kiowa counties, Oklahoma, where irrigated cotton, wheat
and registered Angus are produced, and in Logan and Clark Counties, Ohio, where
the crops are corn and soybeans.
MEMBER: Class A Directors Nominating Committee
DIRECTOR SINCE 1998 AGE: 76
GARY L. HALL is a Class B Director of the Company. He has been the
President of the Kansas Farm Bureau Federation and affiliated companies,
including Kansas Farm Bureau Life Insurance Company and Kansas Farm Bureau
Mutual Insurance Company, since 1994. He is also a director of Farm Bureau
BanCorp. Mr. Hall is also a director of Western Ag. He has been a self-employed
farmer and stockman since 1974, and he served as Kansas Secretary of Agriculture
in 1990 and 1991.
DIRECTOR SINCE 1995 AGE: 48
JAMES K. HARMON is a Class B Director of the Company. He was elected
President of the North Dakota Farm Bureau Federation in 1997 and has been a
member of its board of directors since 1989. Mr. Harmon became President of
NODAK Mutual Insurance Company in 1997, after serving as Vice President since
1993, and has been a director of Western Life since 1993. He is also a member of
the board of directors of Central Dakota Growers, a high value crops development
task force and a director of Farm Bureau BanCorp. Mr. Harmon and his wife
operate a fourth generation farm near Carrington, North Dakota, raising
irrigated potatoes, sunflowers, durum, hard red spring wheat, canola and dry
edible beans.
MEMBER: Class B Directors Nominating Committee
DIRECTOR SINCE 1998 AGE: 40
RICHARD G. KJERSTAD is a Class B Director of the Company. He and his family
have extensive farming and cattle ranching operations in western South Dakota.
Mr. Kjerstad was elected President of the South Dakota Farm Bureau Federation in
1995. He is also President and a director of South Dakota Mutual and a director
of Farm Bureau Life. In 1998 Mr. Kjerstad pleaded guilty to a single misdemeanor
count under the Lacey Act, which is federal statute designed to enforce state
hunting laws. Mr. Kjerstad was placed on probation for a period of two years
(ending December 2000). The conditions of Mr. Kjerstad's probation included
three months of home detention (ending April 1999), 240 hours of community
service, and a $5,000 fine. Mr. Kjerstad was accused of transferring a resident
deer hunting license to a nonresident hunter, in violation of South Dakota law.
MEMBER: Class B Directors Nominating Committee
DIRECTOR SINCE 1995 AGE: 56
5
<PAGE>
DAVID L. MCCLURE is a Class B Director of the Company. He is a
farmer-rancher raising wheat, barley, hay, and cattle in the Lewistown, Montana
area. Mr. McClure has been President of the Montana Farm Bureau Federation since
1987 and is also a director and Vice President of Mountain West Farm Bureau
Mutual Insurance Company, a director of Western Ag and of Mountain States Legal
Foundation, and a director and Vice President of Western Life.
MEMBER: Budget Committee
DIRECTOR SINCE 1994 AGE: 59
BRYCE P. NEIDIG is a Class B Director of the Company. He has been President
of the Nebraska Farm Bureau Federation and of Farm Bureau Insurance Company of
Nebraska since 1981. He is also a director of Farm Bureau Life, American Ag and
Western Ag. Mr. Neidig is also a director of the American Farm Bureau Federation
and a director of Nebraska Blue Cross Blue Shield. He raises irrigated and dry
land corn as well as soybeans and alfalfa on his Madison County farm.
DIRECTOR SINCE 1994 AGE: 67
HOWARD D. (DAN) POULSON, a Class B Director of the Company, has been
President and Administrator of the Wisconsin Farm Bureau Federation and
President of its affiliated companies, including Rural Mutual Insurance Company,
since August 1991. He has served on the board of directors of Wisconsin Farm
Bureau since 1969. He is also a director of Farm Bureau BanCorp. He was
appointed to the State of Wisconsin Department of Natural Resources Board in
October 1995. Mr. Poulson is also a director of Farm Bureau Life. He and his
wife operate a 250 acre hog and grain farm near Palmyra in Jefferson County,
Wisconsin.
MEMBER: Compensation Committee
DIRECTOR SINCE 1994 AGE: 62
FRANK S. PRIESTLEY, a Class B Director of the Company, was elected
President of the Idaho Farm Bureau Federation in 1997, having first been elected
to the Board of Directors of Idaho Farm Bureau Federation in 1985. He is also a
director of Farm Bureau BanCorp. He is also President and a director of Farm
Bureau Mutual Insurance Company of Idaho and Farm Bureau Finance Company
(Idaho). Mr. Priestley graduated from Western College of Auctioneering in 1967
and has actively practiced auctioning. He operates a family dairy farm near
Franklin, Idaho with a herd of 70 Holstein cows.
MEMBER: Class B Directors Nominating Committee
DIRECTOR SINCE 1998 AGE: 50
JOHN J. VAN SWEDEN is a Class B Director of the Company. Mr. Van Sweden is
President and a director of the New Mexico Farm and Livestock Bureau, President
and a director of Western Farm Bureau Mutual Insurance Company, and a director
of Western Life and Western Ag. He is also President of V7 Ranch Co., Inc.,
which has been in his family for five generations since 1868. This is a
cow/calf/yearling and ranch operation, producing approximately 650 tons of hay
per year, in the area of Raton, New Mexico.
MEMBER: Class A Directors Nominating Committee
DIRECTOR SINCE 1994 AGE: 51
6
<PAGE>
SECURITY OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth certain information as to shares of voting
stock of the Company beneficially owned by each director and nominee, each
executive officer named in the Summary Compensation Table below, and by all
executive officers and directors of the Company as a group, including shares
subject to employee and non-employee directors stock options exercisable on or
prior to April 29, 1999. The percentage of Company shares beneficially owned by
any Company director or nominee or by all directors and officers of the Company
as a group, does not exceed 1%. Unless indicated otherwise in the footnotes
below, all shares are directly owned as of February 28, 1999. All numbers of
shares given herein are adjusted for the two-for-one stock split which occurred
in April 1998.
SECURITY OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS
SHARES
BENEFICIALLY
NAME OWNED
---- ------------
Kenneth R. Ashby 4,000(a)
Jerry L. Chicoine 5,935(a)
Al Christopherson 4,264(a)
John W. Creer 4,953(a)
Kenny J. Evans 4,000(a)
Thomas R. Gibson 64,809(c)(d)
Jack M. Givens 4,000(a)
Gary L. Hall 4,000(a)
James K. Harmon 0
Richard D. Harris 17,448(c)(d)
Karen J. Henry 4,305(a)
Timothy J. Hoffman 33,099(c)(d)
Richard G. Kjerstad 11,000(a)
David L. McClure 2,000(b)
Roger Bill Mitchell 3,500(b)
Stephen M. Morain 43,735(c)(d)
Bryce P. Neidig 4,542(a)
James W. Noyce 30,503(c)(d)
William J. Oddy 57,328(c)(d)
Howard D. Poulson 4,000(a)
Frank S. Priestley 4,000(a)
John J. Van Sweden 4,000(b)
John E. Walker 6,527(a)
Edward M. Wiederstein 17,870(c)(d)
All directors and executive officers
as a group (32 persons) 455,303(a)(b)(c)(d)
- ------------------
(a) Includes 4,000 shares subject to options exercisable within 60 days.
(b) Includes shares subject to options exercisable within 60 days for the
following directors: McClure, 2,000; Mitchell, 3,500; Van Sweden, 2,664.
(c) Includes shares held in Company 401(k) Savings Plan by the following
executive officers: Gibson, 4,788; Harris, 2,128; Hoffman, 2,043; Morain,
5,660; Noyce, 4,140; Oddy, 10,681, and Wiederstein, 144.
(d) Includes shares subject to options exercisable within 60 days held by the
following executive officers: Gibson, 57,721; Harris, 15,320; Hoffman,
30,856; Morain, 36,075; Noyce, 25,663; Oddy, 45,447, and Wiederstein,
16,726.
7
<PAGE>
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS(a)
<TABLE>
<CAPTION>
NATURE OF
BENEFICIAL PERCENT
TITLE OF CLASS BENEFICIAL OWNER(b) OWNERSHIP(c) OF CLASS
- -------------- ------------------- ------------ --------
<S> <C> <C> <C>
Class A Common ............. Iowa Farm Bureau Federation 17,115,586 54.3%
Class B Common ............. Iowa Farm Bureau Federation 761,855 63.9
Series B Preferred ......... Iowa Farm Bureau Federation 5,000,000 100.0
Class B Common ............. Farm Bureau Mutual 186,866 15.7
</TABLE>
- ------------------
(a) No other person to the knowledge of the Company was the beneficial owner of
5% or more of the outstanding shares of any class of Company stock.
(b) The address of Iowa Farm Bureau Federation and Farm Bureau Mutual is 5400
University Avenue, West Des Moines, Iowa 50266.
(c) The named beneficial owners have sole dispositive and voting power with
respect to the shares owned by them.
FURTHER INFORMATION CONCERNING THE BOARD OF DIRECTORS
The Board of Directors held seven meetings during 1998. Each director
attended at least 75% of the Board meetings and meetings of committees of which
he or she is a member. The standing committees of the Board of Directors and
the number of meetings held by each such committee in 1998 were as follows:
<TABLE>
<CAPTION>
NUMBER OF MEETINGS
COMMITTEE NAME HELD DURING 1998
-------------- ------------------
<S> <C>
Executive Committee ............................ 11
Audit Committee ................................ 4
Budget Committee ............................... 1
Compensation Committee ......................... 2
Class A Directors Nominating Committee ......... 1
Class B Directors Nominating Committee ......... 1
</TABLE>
The Company has established an Executive Committee composed of Messrs.
Wiederstein (Chairman), Gibson, Harris and Morain. The Executive Committee may
exercise all powers of the Board of Directors during intervals between meetings
of the Board, except for matters reserved to the Board by the Iowa Business
Corporation Act, and except for removal or replacement of the Chairman or Chief
Executive Officer.
The Company has established an Audit Committee composed of Class A
Directors Messrs. Chicoine, Creer and Walker, with Mr. Chicoine serving as
Chairman. The Audit Committee must include only Class A Directors who are
independent of management and free from any relationships that would interfere
with the exercise of independent judgment. The Audit Committee reviews the
professional services to be provided by the Company's independent auditors and
the independence of such auditors from management of the Company. The Audit
Committee also reviews the scope of the audit by the Company's independent
auditors, the annual and quarterly financial statements of the Company, the
Company's system of internal accounting controls and such other matters with
respect to the accounting, auditing and financial reporting practices and
procedures of the Company as it may find appropriate or as may be brought to
its attention, and meets from time to time with members of the Company's
internal audit staff. In addition to the usual and customary functions of an
Audit Committee governed by the requirements of the New York Stock Exchange,
the Audit Committee is required to review with the auditors and management any
material transaction or series of similar transactions to which the
8
<PAGE>
Company was, within the past year, or is currently expected to be, a party, and
with respect to which a director, executive officer, or holder of more than
five percent of any class of stock of the Company is a party. If the Audit
Committee determines that any transaction or proposed transaction between the
Company and Farm Bureau Mutual is unfair to the Company, the Company is
required to submit the matter to a coordinating committee for resolution.
The Company has established a Class A Directors Nominating Committee which
nominates candidates for election to the Board of Directors as Class A
Directors. The Committee members are nominated by the Chairman of the Board,
and include Messrs. Ashby, Creer, Givens, Van Sweden and Walker, with Mr. Ashby
serving as Chairman of the Committee. The Committee must include at least
two-thirds of the Class A Directors and may consist of up to five members of
the Board nominated by the Chairman of the Board. Any action of the Class A
Directors Nominating Committee requires the concurrence of at least 50% of the
Class A Directors who are members of the Committee. The Committee will consider
a nominee for election as a Class A Director recommended by a stockholder if
the stockholder submits the nomination to the Committee. Stockholders may
submit such nominations by addressing a letter to the Chairman of the Class A
Directors Nominating Committee, FBL Financial Group, Inc., 5400 University
Avenue, West Des Moines, Iowa 50266. Under the Company's By-Laws a stockholder
must provide advance notice to the Company in order for such stockholder to
place into nomination a director at the annual meeting. Such notice must be
received by the Secretary at the above address not less than 45 days prior to
the first anniversary date of the mailing of proxy material for the preceding
year's annual meeting, and must set forth the name, age, principal occupation,
number of shares of Company stock beneficially owned, and the business and
residence addresses of both the proposed nominee and the stockholder proposing
to make such nomination.
The Company has established a Compensation Committee of the Board of
Directors which has oversight responsibility with respect to compensation
matters involving executive officers of the Company. The Compensation Committee
is composed of Messrs. Wiederstein, Chicoine, Christopherson, Poulson, and
Walker, with Mr. Wiederstein serving as the Chairman of the Committee.
The Company has established a Budget Committee designated by the Chairman
of the Board and composed of Messrs. Mitchell, Chicoine, Creer, Evans and
McClure, with Mr. Mitchell as Chairman. The Budget Committee reviews all
budgets proposed by management and makes recommendations thereon to the Board
of Directors.
The Company has also established an Investment Committee composed of
Messrs. Gibson, Harris, Morain and four additional executive officers, and an
Advisory Committee, and may establish other committees in its discretion. The
Advisory Committee is composed of certain executives of Farm Bureau affiliated
insurance companies in the Company's market territory.
DIRECTORS' COMPENSATION AND BENEFITS
All non-employee Directors receive an annual retainer of $2,000, a fee of
$1,000 for each board meeting attended and a fee of $500 for each committee
meeting attended. In addition, Class A Directors receive an annual retainer of
$13,333. Directors may elect to receive their fees in cash, in shares of Company
stock, or in deferred stock equivalent units pursuant to the Director
Compensation Plan. All Directors are reimbursed for travel expenses incurred in
attending board or committee meetings. Each non-employee Director receives an
option to purchase 4,000 shares of Class A Common Stock of the Company upon
initial election to the Board of Directors of the Company.
9
<PAGE>
EXECUTIVE OFFICERS
Most of the executive and other officers of the Company devote all of their
time to the affairs of the Company. Services performed for affiliates of the
Company are charged to such affiliates on the basis of a time allocation and the
affiliates are required to reimburse the Company for the cost of such services.
As explained in the section "Certain Relationships and Related Party
Transactions -- Management and Marketing Agreements," the Company receives
management fees for managing its affiliates. Three officers, Mr. Wiederstein,
Mr. Harris and Mr. Morain, are also employed by Management Corp., a wholly owned
subsidiary of the Iowa Farm Bureau Federation, and they are compensated by the
Company for their services to the Company and by Management Corp. for their
services to it based on the portion of their time expected to be expended on
behalf of each entity.
The current executive officers of the Company are as follows:
<TABLE>
<CAPTION>
NAME AGE POSITION
---- --- ----------------------------------------------
<S> <C> <C>
Edward M. Wiederstein .......... 50 Chairman of the Board and Director
Thomas R. Gibson ............... 54 Chief Executive Officer and Director
Richard D. Harris .............. 54 Senior Vice President, Secretary and Treasurer
and Director
Stephen M. Morain .............. 53 Senior Vice President and General Counsel and
Director
William J. Oddy ................ 54 Chief Operating Officer
Timothy J. Hoffman ............. 48 Chief Property-Casualty Officer
James W. Noyce ................. 43 Chief Financial Officer
Thomas E. Burlingame ........... 54 Vice President, Associate General Counsel
Barbara J. Moore ............... 47 Vice President, Market Development
John M. Paule .................. 42 Vice President, Corporate Administration
JoAnn W. Rumelhart ............. 45 Vice President, Life Operations
Lou Ann Sandburg ............... 50 Vice President, Investments
Robert L. Tatge ................ 52 Vice President, Property-Casualty Operations
F. Walter Tomenga .............. 52 Vice President, Corporate Affairs and Marketing
Services
Lynn E. Wilson ................. 49 Vice President, Life Sales
</TABLE>
Set forth below is a description of the business experience, principal
occupation and employment during the last five years of the executive officers
of the Company:
Biographical information for Messrs. Wiederstein, Gibson, Harris and
Morain is set forth above under "Election of Directors."
William J. Oddy, FSA, MAAA, is Chief Operating Officer of the Company; in
March 1997 he was also named as Executive Vice President and General Manager of
the Company's life insurance subsidiaries. He is a member of the Investment
Committee. Mr. Oddy has been employed by the Company and its affiliates since
1968. He is also a director of American Equity Investment Life Insurance
Company, Berthel, Fisher & Company and Berthel, Fisher & Company Financial
Services, Inc.
10
<PAGE>
Timothy J. Hoffman, FSA, CLU, ChFC, FLMI, LLIF, MAAA, was named Chief
Property-Casualty Officer of the Company and Executive Vice President and
General Manager of the Company's property-casualty affiliates in March 1997. He
had been Chief Marketing Officer since 1993. He is a member of the Investment
Committee. Mr. Hoffman has been employed by the Company and its affiliates
since 1971.
James W. Noyce, CPA, FCAS, ASA, FLMI, MAAA, was appointed Chief Financial
Officer of the Company and its major operating subsidiaries in January 1996. He
is a member of the Investment Committee, and Chairman of the Benefits
Administration Committee for each of the companies and Chairman of the
Asset-Liability Committee of the Life companies. Mr. Noyce has been employed by
the Company and its affiliates since 1985. He is also a director of Berthel,
Fisher & Company, Berthel, Fisher & Company Financial Services, Inc. and
Berthel, Fisher & Company Leasing Services, Inc.
Thomas E. Burlingame is Vice President, Associate General Counsel of the
Company and its major operating subsidiaries. Mr. Burlingame has been employed
by the Company and its affiliates since 1980.
Barbara J. Moore, CPCU, AIM, Are, AAM, became Vice President, Market
Development for the Company and its major operating subsidiaries in January,
1999. Ms. Moore was Vice President, Property-Casualty Operations from 1997 to
1998. Ms. Moore was Senior Vice President of Property-Casualty Operations for
Western Ag and Western Mutual from 1991 to 1996. Ms. Moore has been employed by
the Company and its affiliates since 1978.
John M. Paule was appointed Vice President, Corporate Administration in
August 1998 after being named Vice President, Information Technology in January
1998. He joined the Company in 1997. Mr. Paule had been employed by IBM
Corporation since 1978, including during his last five years of employment
being its manager of the North American general business insurance segment and
its senior state executive in Iowa. He is a member of the Board of Directors of
the West Des Moines Community School District.
JoAnn W. Rumelhart, FSA, MAAA, became Vice President, Life Operations of
the Company and its major operating subsidiaries in July of 1994. She began
working for the Company in 1978, and served as Vice President, Client Services
from January 1991.
Lou Ann Sandburg, CFA, FLMI, was named Vice President, Investments in
January 1998. She joined the Company in 1980 as the portfolio manager of the
Company's money market fund, and later assumed the management of the Company's
tax-exempt bonds and mortgage-backed securities portfolios. Ms. Sandburg was
Securities Vice President in 1993 and Investment Vice President, Securities,
from 1994 through 1997. She serves on the Asset-Liability Committee, the
Investment Committee and the Credit Committee. She is past president and board
member of the Iowa Society of Financial Analysts.
Robert L. Tatge, FCAS, MAAA, CLU, ChFC, became Vice President,
Property-Casualty Operations for the Company and its major operating
subsidiaries in July 1994. He has been employed by the Company since 1968 and
previously served as Vice President, Underwriting and Claims from 1991.
F. Walter Tomenga, MPA, CLU, is the Company's Vice President, Corporate
Affairs and Marketing Services. He was Vice President, Corporate Affairs from
June 1994 to March 1997. He has been employed by the Company since 1989,
previously serving as Member Health Services Vice President and as Vice
President, Research and Development.
Lynn E. Wilson, CLU, CHFC, MSFS, was named Vice President, Life Sales in
March 1997, after serving as Vice President, Multi-State Sales since July 1994.
From 1989 to July 1994 he was Senior Vice President of Marketing for Western
Life. He was an agent, and an agency manager for the Company from 1973 to 1985.
11
<PAGE>
EXECUTIVE COMPENSATION
The following table summarizes the compensation expense paid by the
Company and certain affiliates to the Chief Executive Officer and to the
Company's four most highly compensated executive officers, other than the Chief
Executive Officer, who were serving on December 31, 1998, for services rendered
to the Company and its affiliates in all capacities during the fiscal years
ended December 31, 1996, 1997 and 1998.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
---------------
ANNUAL COMPENSATION AWARDS
--------------------------------- ---------------
ALL OTHER(c)
NAME AND PRINCIPAL POSITION(a) YEAR SALARY BONUS OPTIONS(#)(b) COMPENSATION
- -------------------------------- ------ ---------- ---------- --------------- -------------
<S> <C> <C> <C> <C> <C>
Thomas R. Gibson ............... 1996 $294,000 $ 86,707 67,200 $26,483
Chief Executive Officer 1997 322,000 106,630 3,500 30,025
1998 375,000 130,948 5,808 35,595
Stephen M. Morain .............. 1996 251,215 55,567 43,065 14,490
Senior Vice President 1997 266,215 66,118 1,406 20,440
and General Counsel 1998 296,600 77,678 2,498 22,984
William J. Oddy ................ 1996 241,000 71,076 55,086 25,660
Chief Operating Officer 1997 262,000 86,761 3,235 27,194
1998 291,500 101,790 1,808 31,622
Timothy J. Hoffman ............. 1996 181,000 40,036 31,029 16,272
Chief Property-Casualty Officer 1997 200,000 62,256 8,009 19,881
1998 231,000 80,664 1,644 22,525
James W. Noyce ................. 1996 171,000 37,824 29,314 18,818
Chief Financial Officer 1997 183,000 45,450 1,125 11,193
1998 220,000 76,823 9,068 24,414
</TABLE>
- ------------------
(a) These executives receive their total compensation from the Company (except
for Mr. Morain who is an employee of the Company [as to approximately 85%
of his compensation] and of Management Corp.). The Company charges a
management fee for services provided by these executives to the Company's
affiliates. See "Certain Relationships and Related Party Transactions --
Management and Marketing Agreements."
(b) Awards comprised of qualified and nonqualified stock options. The options
have vesting periods as described in "Option Grants in Last Fiscal Year"
table. Unvested options are forfeited upon voluntary termination of
employment with the Company. All options will vest in the event of a change
of control of the Company.
(c) All other compensation includes such items as the cost of life insurance
coverage, the value of personal use of a company fleet automobile or cash
fleet allowance, a company flex cash (cafeteria) account and educational
bonus.
12
<PAGE>
OPTION GRANTS IN LAST FISCAL YEAR
The following table contains information concerning the grant of stock
options during the last fiscal year to the named executive officers under the
Company's 1996 Class A Common Stock Compensation Plan. No stock options,
freestanding stock appreciation rights (SARs) or other equity-based awards were
granted to any executive officer or other persons by the Company prior to 1996.
<TABLE>
<CAPTION>
PERCENT OF TOTAL
NUMBER OF OPTIONS GRANTED TO
SECURITIES UNDERLYING EMPLOYEES IN EXERCISE OR EXPIRATION GRANT DATE
OPTIONS GRANTED(a)(c) FISCAL YEAR BASE PRICE($/sh) DATE PRESENT VALUE(b)
----------------------- ------------------- ------------------ ------------ -----------------
<S> <C> <C> <C> <C> <C>
Thomas R. Gibson 5,808 5.5% $ 18.25 1/15/08 $25,067
Stephen M. Morain 2,498 2.4 18.25 1/15/08 10,781
William J. Oddy 1,808 1.7 18.25 1/15/08 7,803
Timothy J. Hoffman 1,644 1.6 18.25 1/15/08 7,094
James W. Noyce 9,068 8.6 18.25 1/15/08 39,137
</TABLE>
- ------------------
(a) The exercise price of the options equals the fair market price on the date
of grant. Each of these options has a term of up to 10 years and becomes
exercisable in five approximately equal annual installments on each of the
first, second, third, fourth and fifth anniversaries of the date of grant.
Unvested options are forfeited upon a voluntary termination of employment
with the Company. Options vest in the event of a change of control of the
Company. The options granted are incentive stock options to the extent
permitted under the Plan and the Internal Revenue Code, and the remainder
are nonqualified stock options.
(b) The grant date present value of these options was estimated using a
Black-Scholes option pricing model with the following weighted average
assumptions: risk-free interest rate of 5.48%; dividend yield of 1.4%;
volatility factor of the expected market price of the Company's Class A
Common Stock of .12, and a weighted average life expectancy of the options
of 6.4 years. The weighted average grant date fair value of the options
granted during 1998 was $4.32 per share. The actual value, if any, an
executive may realize will depend on the excess of the stock price over the
exercise price on the date the option is exercised, giving no assurance
that the value realized by a named individual will be at or near the value
estimated by the Black-Scholes model.
(c) In 1996, 1997 and 1998, options for the purchase of 1,642,464, 137,684 and
105,143 shares, respectively, of Class A Common Stock were granted, leaving
1,658,763 shares of Class A Common Stock available for grant as additional
Awards under the Plan, including 44,054 shares previously forfeited. To
date, no grants of SARs or stock bonuses have been made under the Plan.
13
<PAGE>
AGGREGATED OPTIONS/SAR EXERCISES IN
LAST FISCAL YEAR AND FY-END OPTIONS/SAR VALUES
The following table provides information with respect to the named
executive officers, concerning the exercise of options during the last fiscal
year and value of unexercised options held as of the end of the fiscal year:
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF
SHARES UNDERLYING UNEXERCISED UNEXERCISED IN-THE-MONEY
ACQUIRED ON VALUE OPTIONS/SARs AT FY-END(#) OPTIONS/SARs AT FY-END($)
NAME EXERCISE REALIZED EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE(a)
- ---- ------------- ---------- --------------------------- -----------------------------
<S> <C> <C> <C> <C>
Thomas R. Gibson 0 $ 0 55,160/92,048 850,430/1,353,368
Stephen M. Morain 0 0 35,014/56,426 540,890/843,560
William J. Oddy 1,000 17,375 44,361/73,089 681,121/1,089,774
Timothy J. Hoffman 0 0 28,025/51,695 419,871/727,578
James W. Noyce 500 9,125 23,400/46,046 361,238/621,717
</TABLE>
- ------------------
(a) Value determined from market price at fiscal year end ($24.25) less
exercise price. The actual value, if any, that an executive may realize
will depend on the stock price on date of exercise of an option, so there
is no assurance the value stated would be equal to the value realized by
the executive.
PENSION BENEFITS
Employees are generally covered under the Farm Bureau Retirement Plan and
the Iowa Farm Bureau Federation Affiliates Supplemental Retirement Plan
(Pension Plans). The two plans operate as a single plan to provide total
benefits to all participants. The former is a qualified plan under Section
401(a) and the latter plan is a nonqualified plan which provides benefits
according to the overall plan formulas, but includes compensation exceeding
$160,000 under Section 401(a)(1) and provides benefits provided by the formula
which are otherwise limited by Section 415 of the Internal Revenue Code. The
pension plans are available to all employees and officers generally and provide
for the same method of allocation of benefits between management and
non-management participants. Active participants include employees over age 21
who have worked at least one year and provided at least 1,000 hours of service
during that year. The pension table below reflects the total pension benefits
provided according to remuneration and completed years of service.
ANNUAL PENSION PLAN BENEFITS*
<TABLE>
<CAPTION>
YEARS OF SERVICE
ASSUMED HIGH ----------------------------------------------------------------
36-MONTH AVERAGE
ANNUAL SALARY 15 20 25 30 35
- ----------------- ---------- ---------- ---------- ----------- -----------
<S> <C> <C> <C> <C> <C>
$ 150,000 $ 48,750 $ 67,500 $ 86,250 $105,000 $105,000
200,000 65,000 90,000 115,000 140,000 140,000
250,000 81,250 112,500 143,750 175,000 175,000
300,000 97,500 135,000 172,500 210,000 210,000
350,000 113,750 157,500 201,250 245,000 245,000
400,000 130,000 180,000 230,000 280,000 280,000
450,000 146,250 202,500 258,750 315,000 315,000
500,000 162,500 225,000 287,500 350,000 350,000
</TABLE>
- ------------------
* The above table is a calculation of benefits according to the formula for
services rendered prior to 1998.
14
<PAGE>
The credited years of service as of December 31, 1998 for Messrs. Gibson,
Morain, Oddy, Hoffman and Noyce were 32, 21, 30, 27 and 13, respectively.
The plan is a defined benefit plan which provides monthly income to
retirees who have worked for at least 10 years and attained age 55. The amount
provided is a percentage of the high 36 consecutive month average salary
calculated according to the following formula: For service prior to 1998, 2%
per year for the first 10 years of service, plus 21/2% for each year above 10
years of service up to 30 years of service. Unreduced early retirement benefits
are provided upon attainment of 85 age plus service points. For service after
1997, 1.675% per year of service, plus, upon attainment of 85 age plus service
points, .325% per year of service to age 65. After age 65, 1.675% per year of
service, plus .325% per year of service times the average salary less social
security covered compensation.
Years of service include all years in which an individual first exceeds
1,000 hours of service and any year thereafter in which the person exceeds 500
hours of service.
The plan formula provides a monthly benefit for life with a guarantee of
120 monthly payments. Other options, including lump sum, are available to the
retiree on an actuarially equivalent basis.
The compensation covered by the Pension Plan is calculated based upon
total salary and bonuses paid to the participant during the given year.
The annual benefits shown in the above table are not reduced to reflect
the limitations imposed by federal tax laws, which place upper limits on the
benefits which may be provided to any individual by tax qualified pension
plans. The Iowa Farm Bureau Affiliates Supplemental Retirement Plan is an
unfunded, non-qualified plan, which provides that it will pay directly the
difference between the retirement benefit in the absence of Internal Revenue
Code Section 401(a)(17) and Section 415 limitations and the benefits actually
calculated under the Farm Bureau Retirement Plan, in compliance with federal
limitations.
OTHER COMPENSATION PLANS
The Company and Farm Bureau Mutual sponsor a bonus plan for all employees,
which includes a management performance (bonus) plan in which executives,
department heads and managers participate. On an annual basis, the companies
establish various and distinct goals for executives, division heads and
managers. Goals generally relate to such matters as Farm Bureau membership
levels, life insurance and property-casualty new business production, expense
levels and earnings per share. Attainment of individual goals is targeted to
result in payment of cash bonuses ranging up to 331/3% of base salary for
Messrs. Gibson, Oddy, Hoffman and Noyce, and up to 8% for managers. Exceptional
performance could increase cash bonuses up to 50% of base salary for the
executive group and up to 12% for managers. Payment of the performance
incentive is made annually in a single, separate lump sum payment on or before
February 14th of the ensuing year.
The Company also has a trustee qualified 401(k) plan for all employees
after 30 days of employment and attainment of age 21. Employee contributions up
to 4% of compensation are matched by Company contributions on a 50% basis,
subject to Employee Retirement Income Security Act (ERISA) limitations with the
match paid in shares of the Company's Class A Common Stock. The Company match
is forfeited should an employee terminate prior to three years of service,
after which the match is nonforfeitable.
15
<PAGE>
BOARD COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors of the Company (the
"Committee") is responsible for oversight of compensation policies which govern
annual compensation, stock ownership programs, and employee benefit programs
for the executive officers as well as other employees of the Company and its
subsidiaries. The Committee was established in July 1996 at the time of the
Company's initial public offering. It has affirmed the Company's historical
compensation framework and expects to continue examining the relationship of
the compensation criteria to existing systems and incentives.
COMPENSATION CRITERIA
In making compensation determinations, the Committee considers and
endeavors to attain the following goals:
1) attract and retain highly qualified and motivated executive officers
and employees,
2) encourage and reward achievement of annual and long-term financial
goals and operating plans of the Company, and
3) encourage executive officers and employees to become stockholders with
interests aligned with those of other stockholders.
The Committee's policy with regard to the compensation of executive
officers is to meet the foregoing goals thorough a combination of base salary,
annual bonus, stock ownership, and other benefits with a particular focus on
encouraging executive officers to attain performance goals that are designed to
favorably impact overall Company performance.
COMPENSATION COMPONENTS
The basic components of compensation for executive officers, including
those individuals listed in the Summary Compensation Table, are in four areas:
BASE SALARY: The Committee sets salary ranges annually which are intended
to reflect the median level of base pay for comparable positions at companies
of similar size and complexity. The Committee reviews salary survey data
provided by independent survey consultants. Based on the scope and
responsibility of the position in the survey compared to the scope and
responsibility of the position at the Company, the Committee determines whether
the officer's salary range should be set above or below the median level of the
industry. To determine the level of a specific salary within its range, the
Committee considers management input regarding the officer's length of service
in the position, experience, and management skills in handling short and long
range issues. In addition, the Committee reviews the officer's performance
during the prior year measured against predetermined corporate and individual
plans and objectives set by management.
ANNUAL BONUS: The Committee believes that a significant portion of annual
cash compensation for the executive officers should be variable ("at risk") and
tied to the Company's financial results. The Company annually establishes
profit, growth, and other goals. Attainment of the goals is designed to produce
bonuses to the executive officers of up to 331/3% of base salary, with
exceptional performance allowing bonus payments up to 50% of base salary.
The Committee may use its discretion to modify a portion of a
participant's award, either upward or downward, based on management's
recommendation of the participant's contribution to the achievement of goals.
16
<PAGE>
STOCK OWNERSHIP: The Committee believes that a fundamental goal of
executive compensation is to encourage and create opportunities for long-term
executive stock ownership. The Committee expects that over time, executive
officers will establish ownership positions that are of significant value as a
percentage of the annual salary of such officers.
The Employee Stock Option Plan provides for the award of stock options
(nonqualified and incentive stock options), stock appreciation rights ("SARs"),
and shares of restricted stock. The Board of Directors encourages ownership of
Company stock through the grant of options to participants in the Plan. To
determine who will participate and the amount of awards, the Company adopted a
formula which covers key management employees, and bases awards on their
position, salary, and previous grants. Generally, the amount increases with the
level of position. The Committee and the Board of Directors intend to make
grants of options on an annual basis and establish a vesting schedule at each
grant date. The options granted in 1996 in conjunction with the initial public
offering were "front end loaded" to represent the bulk of grants to be made
under the formula during the first four years of the Plan. The options vest in
20% increments on the first, second, third, fourth, and fifth anniversary of
the grant date. In 1996, a total of 1,642,464 options were awarded to 100
participants. In 1997, 137,684 options were awarded to 60 participants. In
1998, 105,143 options were awarded to 68 participants.
EMPLOYEE BENEFITS: The Company offers benefit plans such as vacation,
medical, life and disability insurance to executive officers on the same basis
as offered to all employees.
CEO COMPENSATION: The compensation of Mr. Gibson includes the above four
factors. Mr. Gibson has been Chief Executive Officer of the Company since its
formation in 1993, and chief executive officer of its major operating
subsidiaries since 1991. His base salary has been set based on market factors,
his prior performance and in part in recognition of his additional
responsibilities with formation of the Company and its growth. Under Mr.
Gibson's leadership, the Company has grown both internally and by combining
other Farm Bureau insurance entities either under management agreements or as
subsidiaries. The Company believes it is well positioned to continue its
internal growth due to its geographic spread, diverse product portfolio and
ability to cross sell its various products to its existing customers. The
Company's current strategy is to also expand through product alliances with
other Farm Bureau companies, and through distribution of products outside the
Farm Bureau network. Mr. Gibson's base salary was increased by 16.5% in 1998 to
$375,000, and he earned a bonus equal to 34.9% of that base salary based on
1998 Company performance of established goals. Mr. Gibson was awarded options
for 5,808 shares of Class A Common Stock in 1998, which is 5.5% of the awards
granted to all employees in the year.
17
<PAGE>
TAX DEDUCTIBILITY OF EXECUTIVE COMPENSATION
Section 162(m) of the Internal Revenue Code (the "Code") generally limits
to $1 million per individual per year the federal income tax deduction for
compensation paid by a publicly-held company to the company's chief executive
officer and its other four highest paid executive officers. Compensation that
qualifies as performance-based compensation for purposes of Section 162(m) is
not subject to the $1 million deduction limitation. Options and stock
appreciation rights granted under the Stock Option Plan satisfy the
requirements for performance-based compensation. The Committee currently does
not anticipate that any executive officer will be paid compensation from the
Company in excess of $1 million in any year (including amounts that do not
qualify as performance-based compensation under the Code), and accordingly, the
Committee anticipates that all amounts paid as executive compensation will be
deductible by the Company for federal income tax purposes.
COMPENSATION COMMITTEE
Edward Wiederstein, CHAIRMAN
Jerry Chicoine
Al Christopherson
Howard D. Poulson
John E. Walker
18
<PAGE>
PERFORMANCE GRAPH
The following performance graph compares the performance of the Company's
Class A common stock since its initial public offering on July 19, 1996 with
the performance of the S & P 500 Index and with the performance of the Value
Line Insurance: Life Index. The graph plots the changes in value of an initial
$100 investment over the indicated time periods, assuming all dividends are
reinvested.
COMPARISON OF FIVE-YEAR CUMULATIVE TOTAL RETURN
FBL Financial Group, Inc., Standard & Poors 500 Index and Value Line Insurance:
Life Index
(Performance Results Through December 31, 1998)
[PLOT POINT GRAPH]
<TABLE>
<CAPTION>
FBL FINANCIAL GROUP, INC. Standard & Poors 500 Insurance (Life)
------------------------- -------------------- ----------------
<S> <C> <C> <C>
July 19, 1996 100 100 100
December 31, 1996 138.59 117.01 126.97
December 31, 1997 226.31 156.07 217.30
December 31, 1998 277.03 200.38 357.31
</TABLE>
Assumes $100 invested at the open of trading (July 19, 1996) in FBL Financial
Group, Inc. Class A Common Stock, Standard & Poors 500 Index, and the Value
Line Insurance: Life Index.
SOURCE: VALUE LINE, INC.
19
<PAGE>
CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
ORGANIZATION OF THE COMPANY
FBL Financial Group, Inc., incorporated as an Iowa corporation in 1993, is
a holding company. The Company, through its life insurance subsidiaries,
currently markets individual life insurance policies and annuity contracts to
Farm Bureau members and other individuals and businesses in 14 midwestern and
western states. Variable insurance and annuity contracts are also marketed in
other states through alliances with other insurance companies and a regional
broker/dealer. Several other subsidiaries support various functional areas of
the life insurance subsidiaries and other affiliates, by providing investment
advisory, marketing and distribution, and leasing services.
CAPITAL, INVESTMENT AND LOAN TRANSACTIONS: On March 17, 1998, the
Company's Board of Directors approved a two-for-one common stock split payable
in the form of a 100% stock dividend to stockholders of record as of April 6,
1998. The additional shares were distributed April 17, 1998. As required by the
Company's Articles of Incorporation, holders of the Class B common stock
received Class A common shares in payment of the stock dividend. In addition,
the 5,000,000 shares of Series B preferred stock have non-dilutive voting
rights. As a result, voting rights on these shares increased proportionately
while the number of shares outstanding did not change. All references to the
number of common shares and per share amounts in this report have been restated
to reflect the effect of the stock dividend.
On March 30, 1998, the Company exchanged a subsidiary owning its home
office properties for 2,536,112 unregistered shares of Class A common stock
owned by the Iowa Farm Bureau Federation. The Company is leasing a portion of
the properties back from a wholly-owned subsidiary of the Iowa Farm Bureau
Federation under a 15-year operating lease. The value of the transaction, which
was structured as a tax-free exchange of a real estate subsidiary, was
$45,650,000, or $18.00 per common share. The book value of the properties was
$24,729,000 on the date of the exchange. A gain on the transaction of
approximately $20,921,000 was deferred and is being amortized over the term of
the operating lease. Rent expense for the lease during 1998 totaled $1,305,000,
net of $1,046,000 in amortization of the deferred gain on the exchange of home
office properties for common stock.
On March 31, 1998, the Company sold its wholly-owned subsidiary, Utah Farm
Bureau Insurance Company (Utah Insurance), to Farm Bureau Mutual. The Company
recorded a gain on the sale (net of related taxes) of $978,000, consisting of
$179,000 on the transaction date and $799,000 accrued in connection with an
earn-out provision included in the underlying sales agreement. The Company may
earn additional consideration during each of the four years in the period ended
December 31, 2002 in accordance with the earn-out provision. Under the earn-out
arrangement, the Company and Farm Bureau Mutual share equally in the dollar
amount by which the incurred losses on Utah Insurance's direct business, net of
reinsurance ceded, is less than the incurred losses assumed in the valuation
model used to derive the initial acquisition price. The earn-out calculation is
performed and any settlement (subject to a maximum of $2,000,000 per year,
before taxes) is made on a calendar year basis. The Company has not accrued any
contingent consideration for the four year period ending December 31, 2002 as
such amounts, if any, cannot be reasonably estimated as of December 31, 1998.
During 1998, the Company purchased 961,536 shares of Class A common stock
under a stock repurchase plan at $26.00 per share ($25,000,000). Included in
this total are 200,000 Class A shares sold by Farm Bureau Mutual to the Company
for $5,200,000.
During 1998, the Company entered into a $12,000,000 line of credit with
Farm Bureau Mutual in the form of a revolving demand note. Borrowings on the
note, which totaled $8,626,000 at December 31,
20
<PAGE>
1998, are being used to acquire assets that are leased to certain affiliates,
including Farm Bureau Mutual. Interest is payable at a rate equal to the prime
rate of a national bank (7.75% at December 31, 1998). Rental income from the
related leases includes a provision for interest on the carrying value of the
assets.
MANAGEMENT AND MARKETING AGREEMENTS: The Company has management agreements
with Farm Bureau Mutual and other affiliates under which the Company provides
general business, administrative and management services. For insurance
companies, the management fee is equal to a percentage of premiums and premium
equivalents collected. For non-insurance companies, the management fee is equal
to a percentage of expenses incurred. Fee income from Farm Bureau Mutual for
these services during 1998 totaled $381,000. In addition, Farm Bureau
Management Corporation, a wholly-owned subsidiary of the Iowa Farm Bureau
Federation, provides certain management services to the Company under a
separate arrangement. During 1998 the Company incurred related expenses
totaling $689,000.
The Company has marketing agreements with the property-casualty companies
operating within its marketing territory, including Farm Bureau Mutual and other
affiliates. Under the marketing agreements, the property-casualty companies
develop and manage the Company's agency force for a fee equal to a percentage of
commissions on first year life insurance premiums and annuity deposits. In
addition, a service fee commission is paid to the property-casualty companies
operating in certain states equal to 30% of commissions on renewal premiums. The
Company paid $2,439,000 to Farm Bureau Mutual under these arrangements during
1998.
FARM BUREAU MUTUAL POOL
Through Utah Insurance, the Company participated (through the date of sale)
in the Farm Bureau Mutual pool with Farm Bureau Mutual, South Dakota Farm Bureau
Mutual Insurance Company (South Dakota Mutual), Western Ag and Western Mutual
with all five companies operating under the common management of the Company.
All retained insurance business of Utah Insurance, South Dakota Mutual, Western
Ag and Western Mutual was assumed by Farm Bureau Mutual. The combined business,
excluding certain reinsurance assumed exposures, was then assumed by the five
property-casualty companies, in specified proportions, not in excess of an
amount that would create a net written premium to surplus ratio that exceeded
acceptable industry standards.
In the pool, all premiums, losses, loss adjustment expenses, acquisition
and other underwriting and administrative expenses were combined and distributed
proportionately to each property-casualty company, thus providing the five
companies with substantially the same underwriting results. The overall
operating results of the five companies differ based on their respective
investment income, changes in the level of participation in the pool and other
miscellaneous items. During the three months ended March 31, 1998, Utah
Insurance's reinsurance pool participation percentage was 18 percent.
STOCKHOLDERS' AGREEMENT REGARDING MANAGEMENT AND TRANSFER OF SHARES OF CLASS B
COMMON STOCK
All of the Class B Common Stock of the Company is owned by Farm Bureau
organizations. As holders of all of the Class B Common Stock of the Company,
these organizations have entered into the Stockholders' Agreement regarding
management and the transfer of the Class B Common Stock (Stockholders'
Agreement).
The Stockholders' Agreement provides that the holders of the Class B
Common Stock will vote for the election, as Class B Directors of the Company,
of (i) the Presidents of each of the 15 state Farm Bureau Federations which own
or are affiliated with the owners of the Class B Common Stock and (ii) the
Chief Executive Officer of the Company and two additional officers of the
Company nominated
21
<PAGE>
by the Chairman of the Board. The Stockholders' Agreement also provides that as
long as a single state Farm Bureau Federation and its affiliates own in excess
of 50% of the outstanding shares of Class B Common Stock (the Iowa Farm Bureau
Federation owns approximately 63.9% of the Class B Common Stock), the Class B
Common Stockholders will direct the Class B Directors to elect the President of
such state Farm Bureau Federation as the Chairman of the Board, and to elect
persons nominated by the Chairman to serve as Chief Executive Officer,
Secretary and Treasurer.
In the event that a Class B Director chooses to vote other than as directed
pursuant to the requirements of the Shareholders' Agreement, the holders of not
less than 10% of the Class B Common Stock may request a special meeting of the
Class B Common Stockholders, for the purpose of removing the Class B Director,
and either replacing such director with a qualified person or leaving the
position vacant.
The holders of Class B Common Stock may not transfer the stock to any
person which is not a Farm Bureau organization, and any attempted transfer in
violation of the Stockholder's Agreement causes the Class B Common Stock so
transferred to automatically be converted to Class A Common Stock.
The holders of 90% of the Class B Common Stock, together with the Company,
may amend the Stockholders' Agreement.
RELATIONSHIP WITH FARM BUREAU ORGANIZATIONS
American Farm Bureau Federation is a national federation of member
organizations having as a major objective and purpose to promote, protect and
represent the business, economic, social and educational interests of farmers
and ranchers of the nation, and to develop agriculture, and a further objective
to correlate Farm Bureau activities and strengthen member state Farm Bureau
Federations. Through a membership agreement the Iowa Farm Bureau Federation and
similar state Farm Bureau Federations throughout the country agree to cooperate
in reaching these objectives.
American Farm Bureau Federation is the owner of the "Farm Bureau" and "FB"
trade names and related trademarks and service marks including "FB design"
which has been registered as a service mark with the U.S. Patent and Trademark
Office. Under the state membership agreements, use of such trade names and
marks in each state is restricted to members of the federation and their
approved affiliates. The Company is licensed by the Iowa Farm Bureau Federation
to use the "Farm Bureau" and "FB" designations in Iowa, and pursuant thereto
incurred royalty expense of $653,000 for 1998. The Company's subsidiaries have
similar arrangements with Farm Bureau organizations in the other states of the
market territory. Royalty expense incurred pursuant to these arrangements
totaled $980,000. Royalty payments in 1998 in excess of $60,000 were made to
Farm Bureau organizations in Arizona ($69,000), Colorado ($65,000), Idaho
($111,000), Minnesota ($112,000), Nebraska ($81,000), Oklahoma ($206,000), Utah
($72,000), and Wisconsin ($73,000).
OTHER SERVICES, TRANSACTIONS AND GUARANTEES
The Company shares home office facilities, as well as certain management
personnel, with the Iowa Farm Bureau Federation and certain of its affiliates,
including Farm Bureau Mutual and various service companies. Costs are allocated
by factors such as the amount of space used for functions of the various
companies, and time studies and estimates of time spent by personnel for each of
the companies. The allocations are reviewed and approved by the boards of
directors of the respective companies.
Prior to the exchange of home office properties for Class A common stock
on March 30, 1998, the Company leased a portion of its facilities to the Iowa
Farm Bureau Federation, Farm Bureau Mutual and
22
<PAGE>
other affiliates. During the period from January 1, 1998 to March 30, 1998,
Farm Bureau Mutual paid Farm Bureau Life rent of approximately $629,000.
The Company and its subsidiaries provide a number of services to, and
receive certain services from, other Farm Bureau organizations, including the
Company's two largest stockholders, the Iowa Farm Bureau Federation and Farm
Bureau Mutual. The company providing such services is reimbursed based on an
allocation of the cost of providing such services.
Farm Bureau Life owns aircraft which are available for use by the Company's
affiliates. In 1998, Farm Bureau Mutual paid the Company approximately $121,000
for use of such aircraft.
Through its subsidiary, FBL Leasing Services, Inc., the Company leases
computer equipment, furniture and automobiles to other Farm Bureau
organizations. In 1998, the Iowa Farm Bureau Federation paid approximately
$543,000 and Farm Bureau Mutual paid approximately $3,722,000 for such leasing
services.
Through its investment advisor subsidiary, EquiTrust Investment Management
Services, Inc., the Company provides investment advice and related services.
Farm Bureau Mutual paid the Company approximately $339,000 for such services in
1998.
Farm Bureau Mutual will, on occasion, enter into structured settlement
arrangements with EquiTrust Assigned Benefit Company (ETABC), an indirect
wholly-owned subsidiary of the Company. For a fee, ETABC relieves Farm Bureau
Mutual of its contractual obligations relating to a policyholder and funds
payments to the policyholder with an annuity contract purchased from Farm Bureau
Life. Premiums paid to the Company during 1998 under this arrangement totaled
$599,000 during 1998.
In connection with an investment in a limited real estate partnership, the
Company has agreed to pay any cash flow deficiencies of a medium-sized shopping
center owned by the partnership through January 1, 2001. At December 31, 1998,
the Company recorded a $323,000 reserve for expected future cash flow
deficiencies. At December 31, 1998, the limited partnership had a $5,307,000
mortgage loan, secured by the shopping center, with Farm Bureau Mutual.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act generally requires the
officers and directors of a public company, and persons who own more than ten
percent of a registered class of a public company's equity securities, to file
reports of beneficial ownership and changes in beneficial ownership with the
Securities and Exchange Commission. Based solely on its review of the copies of
such reports received by it, or upon written representations received from
certain reporting persons, the Company believes that, during 1998, its officers,
directors and ten-percent shareholders complied with all section 16(a) filing
requirements applicable to them with the following exceptions: Director Richard
Kjerstad was late in filing one report of a purchase of securities, Director
John E. Walker was late in filing two reports covering two purchases of
securities, and ten percent shareholder Iowa Farm Bureau Federation was late in
filing two reports covering two sales of securities.
23
<PAGE>
ITEM 2:
APPROVAL OF AMENDMENT TO BYLAWS
Item 2 concerns the recommendation of the Board of Directors that the
shareholders approve an amendment to Section 3.6(c) of the Bylaws. This section
of the Bylaws dealing with director nominations and voting rights currently
reads as follows:
3.6 NOMINATING COMMITTEE.
(a) Class A Directors Nominating Committee. The Class A Directors
Nominating Committee shall include at least two-thirds of the Class A
Directors and consist of up to five members of the Board of Directors
who shall be nominated by the Chairman of the Board and appointed by
the Board of Directors. Any action of the Class A Directors Nominating
Committee requires the concurrence of at least 50% of the Class A
Directors who are members of such Committee. The Chairman of the Board
shall designate the Chairman and the Secretary of the Class A Director
Nominating Committee. A majority of the members of the Committee shall
constitute a quorum. The Secretary of the Committee shall keep a
complete record of the proceedings thereof. The duty of the Committee
shall be to recommend to the Board of Directors the number of Class A
Directors, which shall be not less than 3, nor more than 5, to be
elected for the next year, and to nominate for election the Class A
Directors. The Secretary of the Committee shall submit and file in
writing with the Secretary of this Corporation, not less than
seventy-five (75) days prior to the date of the meeting of the
shareholders of this Corporation at which Directors are to be elected,
the names of such nominees.
(b) Class B Directors Nominating Committee. The Class B Directors
Nominating Committee shall include at least two (2) Class B Directors
and consist of up to five members of the Board of Directors who shall
be nominated by the Chairman of the Board and appointed by the Board
of Directors. The Chairman of the Board shall designate the Chairman
and the Secretary of the Class B Director Nominating Committee. A
majority of the members of the Committee shall constitute a quorum.
The Secretary of the Committee shall keep a complete record of the
proceedings thereof. The duty of the Committee shall be to recommend
to the Board of Directors the number of Class B Directors, which shall
be not less than 10 nor more than 20, to be elected for the next year,
consistent with any agreement among the Class B Common Stockholders,
and to nominate for election the Class B Directors. The Secretary of
the Committee shall submit and file in writing with the Secretary of
this Corporation, not less than seventy-five (75) days prior to the
date of the meeting of the shareholders of this Corporation at which
Directors are to be elected, the names of such nominees.
(c) Class A and Series A Preferred Shareholder Bylaw. Section 3.6(a)and
this Section 3.6(c) are shareholder bylaws and may only be amended by
a vote of a majority of a quorum of the Class A Common Stock and
Series A Cumulative Voting Preferred Stock, voting together as a
single voting group.
(d) Report of Secretary. The Secretary shall report and submit to the
shareholders for election, the names of those so nominated, if
eligible; in regard to the nominees as Class B Directors, no other
names may be nominated for election and no others may be elected.
As amended, Section 3.6(c) will read as follows:
(c) Class A and Preferred Shareholder Bylaw. Section 3.6(a) and this
Section 3.6(c) are shareholder bylaws and may only be amended by a
vote of a majority of a quorum of the
24
<PAGE>
Class A Common Stock and any series of preferred stock having voting
rights, voting together as a single voting group.
The recommended amendment removes the reference to Series A Cumulative
Voting Preferred Stock, since that series was redeemed in May 1997, and replaces
it with a generic reference that would include any preferred stock outstanding.
Before the Company's recapitalization of May 1997 there were 5,000,000 shares of
Series A Cumulative Voting Preferred Stock outstanding; after that
recapitalization, there are now 5,000,000 shares of Series B Cumulative Voting
Preferred Stock outstanding. The amendment to the Bylaws is merely a conforming
change to match that change in the Company's capital structure.
THE BOARD UNANIMOUSLY RECOMMENDS THAT STOCKHOLDERS VOTE FOR THE APPROVAL OF
THE AMENDMENT TO BYLAW SECTION 3.6(c), AS PROPOSED IN ITEM 2.
ITEM 3:
APPROVAL OF INDEPENDENT AUDITORS
Item 3 concerns the recommendation of the Audit Committee and the Board of
Directors that Ernst & Young LLP be appointed independent auditors for 1999,
which is being presented to stockholders for approval. Representatives of Ernst
& Young LLP will be present at the meeting, will be available to respond to
questions and may make a statement if they so desire.
THE BOARD UNANIMOUSLY RECOMMENDS THAT STOCKHOLDERS VOTE FOR THE APPOINTMENT
OF ERNST & YOUNG LLP AS INDEPENDENT AUDITORS FOR 1999, AS PROPOSED IN ITEM 3.
STOCKHOLDER PROPOSALS
Proposals which stockholders intend to present at the 1999 annual meeting
of stockholders to be held in May 2000 must be received by the Secretary of the
Company, Richard D. Harris, FBL Financial Group, Inc., 5400 University Avenue,
West Des Moines, Iowa 50266 by November 30, 1999, and must otherwise comply with
rules promulgated by the Securities and Exchange Commission in order to be
eligible for inclusion in the proxy material for the meeting. In addition, under
the Company's By-Laws a stockholder must provide advance notice to the Company
in order for such stockholder to bring any business before the annual meeting.
Such notice must be received by the Secretary at the above address not less than
45 days prior to the anniversary date of the mailing of the proxy statement for
the preceding year's annual meeting, and must describe the business proposed to
be brought before the annual meeting, the reasons for bringing it, any material
interest of the stockholder in such business, the stockholder's name and address
and the number of shares of Company stock beneficially owned by the stockholder.
25
<PAGE>
OTHER MATTERS
Officers and other employees of the Company and its subsidiaries may
solicit proxies by personal interview, telephone and telegram, in addition to
the use of the mails. None of these individuals will receive special
compensation for these services which will be performed in addition to their
regular duties, and some of them may not necessarily solicit proxies. The
Company has also made arrangements with brokerage firms, banks, nominees and
other fiduciaries to forward proxy solicitation materials for shares held of
record by them to the beneficial owners of such shares. The Company will
reimburse them for reasonable out-of-pocket expenses. The Company will pay the
cost of all proxy solicitation.
By order of the Board of Directors,
/s/ Richard D. Harris
Richard D. Harris
SECRETARY
Dated: March 30, 1999
26
<PAGE>
FBL Financial Group, Inc.
March 30, 1999
Dear Shareholder:
The annual meeting of Stockholders of FBL Financial Group, Inc. will be
held at the principal executive offices of the Corporation at 5400 University
Avenue, West Des Moines, Iowa at 9:00 a.m. on Tuesday, May 18, 1998. At the
meeting Class A Stockholders will elect three directors, Class B Stockholders
will elect 18 directors, and the stockholders will act on proposals to amend a
stockholder Bylaw and to ratify the selection of Ernst & Young LLP as
independent auditors.
It is important that your shares are represented at this meeting.
Whether or not you plan to attend the meeting, please review the enclosed proxy
materials, complete the attached proxy form below, and return it promptly in the
envelope provided.
(Detach Proxy Form Here)
- --------------------------------------------------------------------------------
THIS PROXY WILL BE VOTED "FOR" ITEMS 1, 2 AND 3 IF NO INSTRUCTION TO THE
CONTRARY IS INDICATED. IF ANY OTHER BUSINESS IS PRESENTED AT THE MEETING, THIS
PROXY WILL BE VOTED IN ACCORDANCE WITH THE RECOMMENDATION OF MANAGEMENT.
Dated ___________________________, 1999
_______________________________________
_______________________________________
Please sign name or names
as appearing on this proxy.
If signing as a
representative, please
indicate capacity.
<PAGE>
(Detach Proxy Form Here)
- --------------------------------------------------------------------------------
PROXY
CLASS A COMMON SHAREHOLDERS
FBL FINANCIAL GROUP, INC.
ANNUAL MEETING MAY 18. 1999
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF THE CORPORATION
The undersigned Class A shareholder of FBL Financial Group, Inc., an
Iowa corporation, appoints Edward M. Wiederstein and Thomas R. Gibson, or either
of them, with full power to act alone, the true and lawful attorneys-in-fact of
the undersigned, with full power of substitution and revocation, to vote all
shares of stock of said Corporation which the undersigned is entitled to vote at
the annual meeting of its shareholders to be held at the principal executive
offices of the Corporation at 5400 University Avenue, West Des Moines, Iowa, on
May 18, 1999, at 9:00 a.m. and at any adjournment thereof, with all powers the
undersigned would possess if personally present, as follows:
1. Election of Class A Directors:
[ ] FOR all nominees listed below [ ] WITHHOLD AUTHORITY to vote for
(except as marked to the contrary below) all nominees listed below
Jerry L. Chicoine, John W. Creer, John E. Walker
INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, WRITE
THAT NOMINEE'S NAME IN THE SPACE BELOW.
- ---------------------------------------------------------------------
2. Proposal to amend the Bylaws.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. Proposal to ratify the appointment of Ernst & Young LLP as independent
auditors for the Company: [ ] FOR [ ] AGAINST [ ] ABSTAIN
4. On any other matter that may be submitted to a vote of shareholders.
(YOU ARE REQUESTED TO COMPLETE, SIGN AND RETURN THIS PROXY PROMPTLY)
