American Financial Group, Inc. Deferred Compensation Plan

American Financial Group, Inc.

Deferred Compensation Plan

(As amended and restated effective December 1, 2008)

1. Establishment and Purpose

Effective November 1, 1999, American Financial Group, Inc. ("AFG" or the "Company") adopted this Deferred Compensation Plan (the "Plan") to enable eligible Employees of the Company and its subsidiaries to defer payment of a portion of their compensation. This Plan has subsequently been amended and restated. This Plan was amended and restated for deferrals made on or after January 1, 2005 to provide good faith compliance with the provisions of Section 409A of the Internal Revenue Code of 1986, as amended (the "Code"). This Plan was also amended and restated effective as of November 1, 2007. This Plan is amended and restated as set forth herein effective as of December 1, 2008, unless otherwise provided herein, to comply with the provisions of Section 409A of Code and the final regulations thereunder.

2. Plan Objectives

            The purpose of the Plan is to assist eligible Employees to:

2. 1. Accumulate income for retirement; and
   2. Provide opportunity for financial growth.
3. Definitions

When used in this Plan, the following words and phrases shall have the following meanings:

3. 1. "Account" means the record maintained for each Participant to which all deferrals, earnings (or losses) and distributions are credited and debited for each Plan Year.
   2. "Administrator" means the person or persons appointed by the Board of Directors of the Company who is responsible for those functions assigned to the Administrator under the terms of the Plan.
   3. "Base Salary" means annual base pay, excluding any bonuses and other extraordinary payments, payable by the Company to a Participant.
   4. "Bonus" means any direct lump-sum payment paid for services rendered in addition to the Participant's Base Salary.
   5. "Code" means the Internal Revenue Code of 1986, as amended.
   6. "Common Stock" means the Company's common stock.
   7. "Company" means American Financial Group, Inc. and (unless the context indicates otherwise) its subsidiaries and affiliates.
   8. "Compensation" means Base Salary and Bonus.
   9. "Disabled" or "Disability" means the Participant is (i) unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, or (ii) by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, receiving income replacement benefits for a period of not less than 3 months under an accident and health plan covering employees of the Company.
   10. "Election Form" means a Participant's agreement, on a form provided by the Administrator or in such other manner acceptable to the Administrator, to defer the Participant's Base Salary and/or Bonus.
   11. "Employee" means an employee of the Company.
   12. "Participant" means an officer or other highly compensated Employee who participates in the Plan for a designated Plan Year in accordance with the terms of the Plan, and who has an Account in the Plan.
   13. "Plan" means this American Financial Group, Inc. Deferred Compensation Plan, as amended and restated from time to time.
   14. "Plan Year" means the calendar year, January 1 through December 31. The initial Plan Year commenced on January 1, 2000.
   15. "Retirement" means Separation from Service on or after attaining age 60.
   16. "Separation from Service" means the termination of employment with the Company. Whether a termination of employment has occurred shall be determined based on whether the facts and circumstances indicate that the Company and the Participant reasonably anticipate that no further services would be performed after a certain date or that the level of bona fide services would permanently decrease to no more than 20 percent of the average level of bona fide services performed over the immediately preceding 36-month period (or the full period of employment if the Participant has been employed by the Company less than 36 months). A Participant is not treated as having terminated employment while the Participant is on military leave, sick leave or other bona fide leave of absence if the period of such leave does not exceed six months, or if longer, so long as the individual retains a right to reemployment under an applicable statutes or by contract. The determination of whether a Separation of Service has occurred shall be based on applicable regulations and other applicable legal authority under Section 409A of the Code.
   17. "Specified Employee" means a Participant who, as of the date of his Separation from Service, is a key employee in that the Participant meets the requirements of Section 416(i)(1)(A)(i), (ii) or (iii) of the Code (applied in accordance with the regulations thereunder and disregarding Section 416(i)(5) of the Code). The determination of whether an individual is such a key employee shall be made as of each December 31 ^st and that determination shall be controlling for the twelve-month period commencing on the immediately following April 1 ^st . The determination of Specified Employees shall be based on applicable regulations and other applicable legal authority under Section 409A of the Code.
4. Eligibility

Officers and other highly compensated Employees of the Company and its subsidiaries will be eligible to become Participants in the Plan either through annual invitation by the Administrator or through an employment agreement approved by the Chief Executive Officer.

5. Participation
6. 1. A Participant who is eligible as provided in Section 4 may elect to defer Compensation by delivering to the Administrator at the time and in the manner specified each year by the Administrator prior to the beginning of each Plan Year, a properly completed Election Form that conforms to the terms and conditions of the Plan. An Election Form that is timely delivered to the Administrator shall be effective for the Plan Year following the year in which the Election Form is delivered to the Administrator. In the case of the first year in which a Participant becomes eligible to participate in the Plan, the Participant may make an initial deferral election within 30 days after the date the Participant becomes eligible to participate with respect to Compensation paid for services to be performed after the election.
   2. Notwithstanding the above, an individual's Election Form relating to a Bonus that is "performance-based compensation" within the meaning of Section 409A of the Code and the regulations thereunder must be made no later than 6 months before the end of the performance period, provided the Participant performs services continuously from the later of the beginning of the performance period or the date the performance criteria are established through the date an election is made under this Section 5(b), and provided further that in no event may an election to defer from a Bonus that is performance-based compensation be made after such Bonus has become readily ascertainable.
7. Deferred Compensation Account
8. 1. For each Plan Year, a deferred compensation Account will be established for each Participant.
   2. All Compensation deferred by the Participant, all earnings (or losses) determined under Section 8 and all distributions from the Account to the Participant or the Participant's beneficiaries or estate shall be reflected in the Account.
   3. The Administrator shall maintain all Accounts.
9. Deferral Sources
10. 1. At the time of enrollment, a Participant must elect through an Election Form to defer a stated percentage of his or her Compensation for services rendered in the next Plan Year. For purposes of this Section 7, Base Salary payable after December 31 ^st solely for services performed during the final payroll period containing such December 31 ^st , shall be treated as Compensation for services performed in the subsequent taxable year in which the payment is made.
    2. Any Base Salary deferral must be at least 5% and no more than 80% of Base Salary. Any Bonus deferral must be at least 10% and no more than 80% of each Bonus. No deferral election shall reduce a Participant's paid Compensation below the amount necessary to satisfy applicable employment taxes (e.g., FICA/Medicare) on amounts deferred, benefit plan withholding requirements or income tax withholding for Compensation that cannot be deferred.
    3. Compensation deferred under this Plan shall be credited to the Participant's Account on the date such amounts would have otherwise been paid.
    4. Except as provided in Section 11(c), the deferral sources and amounts elected for a given Plan Year are irrevocable.
11. Crediting of Earnings
12. 1. There shall be credited to the Account of each Participant an additional amount of earnings (or losses) determined under this Section 8.
    2. At the time a Participant elects to defer Compensation, each Participant also shall elect (in whole percentages) to have earnings (or losses) credited to his or her Account under one (or a combination) of the investment elections provided herein. Prior to January 1, 2007, the investment elections were an Interest Election and a Common Stock Election.

Effective as of January 1, 2007, there shall be an Interest Election, a Common Stock Election and a Mutual Fund Election. The Plan Administrator may change any of the investment elections that are offered under the Plan from time to time in its discretion.

A Participant who makes the Mutual Fund Election may allocate his or her Account among any combination of the Mutual Funds that are selected and made available by the Plan Administrator from time to time as identified in the attached Schedule A.

To the extent a Participant selects the Interest Election, his or her Account will be adjusted to earn interest during any Plan Year of the deferral term at a rate determined by the Board of Directors of the Company not later than the prior November 15. The interest rate selected will be based on the general level of interest rates as well as interest rates the Company is paying on its debt obligations. In the exercise of its discretion, the Board of Directors of the Company may raise (but not lower) such selected interest rate for any Plan Year, bas