As filed with the Securities and Exchange Commission on December 6, 1996
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
Incorporated AMERICAN ANNUITY GROUP, INC. I.R.S. Employer
Under the Laws 250 EAST FIFTH STREET Identification No.
of Delaware CINCINNATI, OHIO 45202 06-1356481
(513) 333-5300
AMERICAN ANNUITY GROUP, INC.
DEFERRED COMPENSATION PLAN
Mark F. Muething, Esq.
Senior Vice President,
General Counsel and Secretary
American Annuity Group, Inc.
Cincinnati, Ohio 45202
(513) 333-5300
(Agent for Service)
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Proposed Proposed
Maximum Maximum
Title of Amount Offering Aggregate Amount of
Securities To Be Price Offering Registration
To Be Registered Registered(1) Per Unit(2) Price(2) Fee(3)
<S> <C> <C> <C> <C>
Deferred
Compensation
Obligations $7,500,000 $1 $7,500,000 $2,273
Common Stock,
par 500,000 $13.9375 $6,968,750 $2,112
value $1.00 per Shares
share
<FN>
(1) This Registration Statement is filed for up to $7,500,000 in Deferred
Compensation Obligations and up to 500,000 shares issuable pursuant
to the American Annuity Group, Inc. Deferred Compensation Plan.
(2) Estimated solely for purposes of calculating registration fee.
(3) Registration fee has been calculated pursuant to Rule 457(h).
</TABLE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
The following documents filed by American Annuity Group, Inc. (the
"Company") with the Securities and Exchange Commission are incorporated
herein by reference and made a part hereof:
1. The Company's Annual Report on Form 10-K for the year ended December
31, 1995.
2. The Company's Quarterly Reports on Form 10-Q for the quarters ended
March 31, 1996, June 30, 1996 and September 30, 1996.
3. The description of the Company's Common Stock contained in the
Registration Statement on Form 10 filed on May 22, 1987 under the
Securities Exchange Act of 1934.
All reports and other documents filed by the Company pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, prior to
the filing of a post-effective amendment which indicates that all Securities
offered have been sold or which deregisters all Securities then remaining
unsold, shall be deemed to be incorporated by reference in this Registration
Statement and to be a part hereof from the date of filing such documents.
Item 4. Description of Securities
Under the American Annuity Group, Inc. Deferred Compensation Plan (the
"Plan"), the Company will provide eligible employees the opportunity to
defer a specified percentage of their cash compensation. Eligible employees
may elect to have earnings credited to such employee's deferred compensation
account under two investment options. An employee can either defer compen-
sation into an account in which funds are credited with earnings based on
the market performance of the Company's Common Stock (the "AAG Common Stock
Option"), an interest-bearing account (the "Interest Option") or a combina-
tion of the foregoing.
The obligation of the Company ultimately to pay such deferred amounts in
accordance with the Plan (the "Deferred Obligations") will be unsecured
general obligations of the Company and will rank pari passu with other
unsecured and unsubordinated indebtedness of the Company from time to time
outstanding. The Company is a holding company, and its right to participate
in any distribution of the assets of any subsidiary upon its liquidation or
reorganization or otherwise is subject to the prior claims of creditors of
the subsidiary, except to the extent that claims of the Company itself as a
creditor of the subsidiary may be recognized. Consequently, the rights of
participants in the Plan are subject to the prior claims of creditors of the
Company's subsidiary.
The amount of compensation to be deferred by each participating employee
will be determined in accordance with the Plan based on elections by the
employee. Each distribution under either the AAG Common Stock Option or the
Interest Option will be made on a date selected by the employee participant
in accordance with the terms of the Plan.
To the extent a participant selects the Interest Option, their account
will be adjusted to earn interest at a rate determined by the Board of
Directors of the Company. Such obligations will be denominated and be
payable in United States dollars.
To the extent a participant selects the AAG Common Stock Option, their
account will change in value based on the price of the Company's Common
Stock beginning on the date of the investment of such Common Stock in
accordance with the terms of the Plan. Such obligations will be paid in
shares of Company Common Stock. A description of the Company's Common Stock
is contained in the documents incorporated herein by reference.
Any employee participant's right or the right of any other person to the
Deferred Obligations cannot be transferred, pledged, or encumbered except by
a written designation of a beneficiary under the Plan.
The Deferred Obligations are not subject to redemption, in whole or in
part, prior to the individual payment dates specified by the participating
employees, at the option of the Company or through operation of a mandatory
or optional sinking fund of analogous provision. However, the Company
reserves the right to amend or terminate the Plan at any time, except that
no such amendment or termination shall reduce retroactively the right of an
employee participant to the balance of his or her deferred account as of the
date of such amendment or termination.
The Deferred Obligations are not convertible into another security of the
Company. The Deferred Obligations will not have the benefit of a negative
pledge or any other affirmative or negative covenant on the part of the
Company. no trustee has been appointed having the authority to take action
with respect to the Deferred Obligations and each employee participant will
be responsible for acting independently with respect to, among other things,
the giving of notices, responding to any requests for consents, waivers or
amendments pertaining to the Deferred Obligations, enforcing covenants and
taking action upon a default.
Item 5. Interests of Named Experts and Counsel
The legality of the Common Stock and the Deferred Obligations offered
hereby will be passed upon for the Company by Mark F. Muething, Esq., Senior
Vice President, General Counsel and Secretary of the Company. Mr. Muething
beneficially owns 8,148 shares of the Company's Common Stock.
Item 6. Indemnification of Directors and Officers
Section 145 of the Delaware General Corporation Law ("DGCL") provides
generally and in pertinent part that a Delaware corporation may indemnify
its directors and officers against expenses, judgments, fines, and
settlements actually and reasonably incurred by them in connection with any
civil suit or action, except actions by or in the right of the corporation,
or any administrative or investigative proceeding if, in connection with the
matters in issue, they acted in good faith and in a manner they reasonably
believe to be in, or not opposed to, the best interest of the corporation,
and in connection with any criminal suit or proceeding, if in connection
with the matters in issue, they had no reasonable cause to believe their
conduct was unlawful. Section 145 further provides that, in connection with
the defense or settlement of any action by or in the right of the
corporation, a Delaware corporation may indemnify its directors and officers
against expenses actually and reasonably incurred by them if, in connection
with the matters in issue, they acted in good faith, in a manner they
reasonably believed to be in, or not opposed to, the best interests of the
corporation, and without negligence or misconduct in the performance of
their duties to the corporation. Section 145 further permits a Delaware
corporation to grant its directors and officers additional rights of
indemnification through by-law provisions and otherwise.
Article VII of the Registrant's By-laws provides for indemnification of
directors and officers similar to that provided in Section 145 of DGCL.
Reference is made to Section 102(b)(7) of the DGCL, which enables a
corporation in its original certificate of incorporation or an amendment
thereto to eliminate or limit the personal liability of a director for
violations of the director's fiduciary duty, except (i) for any breach of
the director's duty of loyalty to the corporation or its stockholders, (ii)
for acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of law, (iii) pursuant to Section 174 of
the DGCL (providing for liability of directors for unlawful payment of
dividends or unlawful stock purchases or redemptions) or (iv) for any
transaction from which a director derived an improper personal benefit.
Article Ninth of the Registrant's Certificate of Incorporation eliminates
the liability of directors to the extent permitted by Section 102(b)(7) of
the DGCL.
The Registrant also maintains directors' and officers' reimbursement and
liability insurance and has entered into agreements with its directors and
officers providing for indemnification in certain events.
Item 7. Exemption from Registration Claimed
Not applicable.
Item 8. Exhibits*
5 Opinion of Mark F. Muething, Esq.
10 American Annuity Group, Inc. Deferred Compensation Plan
23.1 Consent of Mark F. Muething, Esq. (contained on Exhibit 5).
23.2 Consent of Ernst & Young LLP
24 Power of Attorney (contained on the signature page).
* All exhibits filed herewith.
Item 9. Undertakings
9.1 The undersigned Registrant hereby undertakes to file, during any
period in which offers or sales are being made, a post-effective amendment
to this Registration Statement:
1. to include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
2. to reflect in the prospectus any facts or events arising after the
effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set
forth in the Registration Statement. Notwithstanding the
foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities offered would not
exceed that which was registered) and any deviation from the low
or high end of the estimated maximum offering range may be
reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in
volume and price represent no more than a 20% change in the
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement.
3. to include any material information with respect to the
plan of distribution not previously disclosed in the
Registration Statement or any material change to such
information in the Registration Statement;
Provided, however, that paragraphs (1) and (2) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the registrant pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in the
registration statement.
9.2 The undersigned Registrant hereby undertakes that, for the purpose of
determining any liability under the Securities Act of 1933, each such post-
effective amendment shall be deemed to be a new Registration Statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
9.3 The undersigned Registrant hereby undertakes to remove from
registration by means of a post-effective amendment any of the securities
being registered which remain unsold at the termination of the offering.
9.4 The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of
the Registrant's annual report pursuant to Section 13(a) or Section 15(d) of
the Securities Exchange Act of 1934 that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
9.5 Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the foregoing provisions,
or otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other than
the payment by the Registrant of expenses incurred or paid by a director,
officer or controlling person of the Registrant in the successful defense of
any action, suit, or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against
public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
SIGNATURES
The Registrant. Pursuant to the requirements of the Securities Act of
1933, the Registrant certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-8 and has duly
caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in Cincinnati, Ohio, on December 6,
1996.
AMERICAN ANNUITY GROUP, INC.
By:
Carl H. Lindner
Chairman of the Board and
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated. Persons whose names are marked with
an asterisk (*) below hereby designate Mark F. Muething or William J. Maney
as their attorney-in-fact to sign all amendments, including any post-
effective amendments, to this Registration Statement.
Signature Capacity Date
* Chairman of the Board December 6, 1996
Carl H. Lindner and Chief Executive
Officer (Principal
Executive Officer)
* Director December 6, 1996
S. Craig Lindner
* Director December 6, 1996
Robert A. Adams
* Director December 6, 1996
A. Leon Fergenson
* Director December 6, 1996
Ronald G. Joseph
* Director December 6, 1996
John T. Lawrence III
* Director December 6, 1996
William R. Martin
* Director December 6, 1996
Ronald F. Walker
* Senior Vice December 6, 1996
William J. Maney President, Treasurer
and Chief Financial
Officer (Principal
Accounting Officer
and Principal
Financial Officer)
The Plan. Pursuant to the requirements of the Securities Act of 1933, the
trustees (or other persons who administer the employee benefit plan) have
duly caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the city of Cincinnati, state of
Ohio, on December 6, 1996.
American Annuity Group, Inc. Deferred
Compensation Plan
By: Mark F. Muething
Title: Senior Vice President,
General Counsel and Secretary
AMERICAN ANNUITY GROUP, INC.
250 EAST FIFTH STREET
CINCINNATI, OHIO 45202
December 6, 1996
American Annuity Group, Inc.
250 East Fifth Street
Cincinnati, Ohio 45202
Gentlemen:
RE: Registration Statement on Form S-8
I serve as General Counsel to American Annuity Group, Inc. (the "Compa-
ny"). In connection with this opinion, I have examined and am familiar with
originals or copies, certified or otherwise identified to my satisfaction,
of such documents as I have deemed necessary or appropriate as a basis for
the opinions set forth below including (i) the Registration Statement on
Form S-8 relating to the Company's Deferred Compensation Plan (the "Plan"),
(ii) the Certificate of Incorporation and By-Laws of the Company, each as
amended to the date hereof, and (iii) resolutions of the Board of Directors
of the Company relating to the approval of the Plan, issuance of shares of
Common Stock pursuant to the Plan and the filing of the Registration
Statement.
Based upon and subject to the foregoing, I am of the opinion that, when
the Registration Statement has become effective under the Securities Act of
1933:
(i) the obligations under the Plan will, when arising under the Plan in
accordance with its terms, constitute valid and binding obligations of the
Company;
(ii) when the shares of Common Stock have been issued as contemplated by
the Plan, such shares of Common Stock will constitute duly issued, fully
paid and non-assessable shares of Common Stock of the Company;
(iii) the Company is a duly organized and validly existing corporation
under the laws of the State of Delaware; and
(iv) the Company has taken all necessary and required corporate actions
in connection with the Plan.
I hereby consent to the reference to me under the heading "Legal Matters"
in the Prospectus and the filing of this opinion as Exhibit 5 to the
Registration Statement.
Mark F. Muething
Senior Vice President,
General Counsel and Secretary
EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the Registration Statement
(Form S-8) and related Prospectus pertaining to the American Annuity Group,
Inc. Deferred Compensation Plan for the registration of 500,000 shares of
its common stock and $7,500,000 of its Deferred Compensation Obligations of
our report dated February 29, 1996, with respect to the consolidated
financial statements and schedules of American Annuity Group, Inc. included
in its Annual Report (Form 10-K) for the year ended December 31, 1995, filed
with the Securities and Exchange Commission.
ERNST & YOUNG LLP
Cincinnati, Ohio
December 6, 1996
AMERICAN ANNUITY GROUP, INC.
DEFERRED COMPENSATION PLAN
Effective as of July 1, 1994
American Annuity Group, Inc.
Deferred Compensation Plan
1.0 Establishment and Purpose
1.1a Effective July 1, 1994, American Annuity Group, Inc., a Delaware
corporation, adopts this Deferred Compensation Plan to enable
eligible Employees of the Company and its subsidiaries to elect
deferral of payment of their compensation.
2.0 Plan Objectives
2.1 The purpose of this Plan is to assist eligible Employees to:
(a) Accumulate income for retirement; and
(b) Provide opportunity for financial growth.
3.0 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, interest and distributions are credited and debited
for each Plan Year.
3.2 "Administrator" means the person or persons appointed by the Board of
Directors of American Annuity Group who shall be responsible for
those functions assigned to the Administrator under the terms of this
Plan.
3.3 "Annual Bonus" means any direct lump-sum payment made in addition to
the Participant's Base Salary.
3.4 "Base Salary" means base pay, excluding any bonuses, commissions and
other extraordinary payments.
3.5 "Company" means American Annuity Group, Inc. and (unless the context
indicates otherwise) its subsidiaries.
3.6 "Compensation" means Base Salary and Annual Bonus earned for services
rendered during a given Plan Year.
3.7 "Disabled" and "Disability" mean that a Participant, as a result of
accident or illness, is physically, mentally or emotionally unable to
perform the duties for which the Participant is employed, and in the
Administrator's opinion is likely to remain so disabled for at least
one year. The Administrator shall make all determinations as to
whether a Participant is disabled and shall use such evidence
including independent medical reports and data, as the Administrator
deems necessary and desirable.
3.8 "Employee" means an employee of the Company.
3.9 "Excess 401(k) Deferral" means the excess, if any, of (i) the amount
a Participant elects to defer under the Company's 401(k) plan, over
(ii) the limitation (as adjusted) on deferrals contained in Section
402(g) of the Internal Revenue Code of 1986, as amended.
3.10 "Expiration Date" means, with respect to each annual deferral under
Section 7.1, the earlier of (i) the last day of the year to which a
Participant elects to defer Compensation pursuant to Section 8.1, or
(ii) the pay date for the payroll period in which a Participant dies,
becomes Disabled or terminates employment with the Company.
3.11 "Participant" means an officer or other highly compensated Employee
who is selected or entitled to participate and participates in the
Plan for a designated Plan Year.
3.12 "Plan" means this American Annuity Group, Inc. Deferred Compensation
Plan.
3.13 "Plan Year" means the calendar year, January 1 through December 31.
The initial Plan Year shall commence on October 24, 1994 and
terminate December 31, 1994.
4.0 Eligibility
4.1 Officers and other highly compensated Employees of the Company will
be eligible to become Participants in the Plan either through annual
invitation by the Administrator or through an employment agreement
approved by the President.
5.0 Participation
5.1 A Participant elects to participate in the Plan by delivering to the
Administrator, before the beginning of each Plan Year, a properly
completed enrollment form.
5.2 The enrollment form shall conform to the terms and conditions of the
Plan.
6.0 Deferred Compensation Account
6.1 For each Plan Year a deferred compensation Account will be
established for each Participant.
6.2 All Compensation deferred by the Participant (including all Excess
401(k) Deferrals), all interest earned on deferrals and all
distributions from the Account to the Participant or the
Participant's beneficiary(ies) or estate shall be reflected in the
Account.
6.3 All Accounts shall be maintained by the Administrator.
7.0 Deferral Sources
7.1 At the time of enrollment, a Participant must elect to defer
Compensation for services rendered in the next Plan Year consisting,
for the purposes of this Plan, of one or more of the following three
components: Base Salary, Annual Bonus and Excess 401(k) Deferrals.
7.2 Any Base Salary deferral must be at least 5% of Base Salary. Any
Annual Bonus deferral must be at least 10% of each Annual Bonus.
7.3 Compensation deferred under this Plan and Excess 401(k) Deferrals
shall be credited to the Participant's Account on the date such
amounts would have otherwise been paid.
7.4 The deferral sources and amounts elected for a given Plan Year are
irrevocable.
8.0 Deferral Term
8.1 At the time a Participant elects to defer Compensation, the
Participant must also elect the term for which such deferral is made
(the "deferral term"). The deferral term for Base Salary or Annual
Bonus deferrals must be either a fixed number of years or the date on
which the Participant dies, becomes Disabled or terminates employment
with the Company for any reason. The deferral term for all Excess
401(k) Deferrals shall always end upon death, Disability or
termination of employment for any reason.
8.2 A deferral term that is for a fixed number of years must be in full
year increments.
9.0 Interest on Deferrals
9.1 All deferrals credited to a Participant's account shall earn interest
at a rate determined by the American Annuity Group Board of Directors
or a committee thereof. Interest on Compensation deferred under this
Plan and Excess 401(k) Deferrals shall accrue from the date such
amounts would have otherwise been paid but interest shall be credited
quarterly on the last day of each March, June, September and
December.
9.2 For each Plan Year, an interest rate shall be determined. That
interest rate will be used to determine the interest to be credited
to each account for that year, regardless of the Plan Year from which
the deferral was made. For the initial Plan Year, deferrals shall
earn interest at the rate of 10% per annum.
10.0 Payment Form and Method
10.1 All payments from the Plan shall be made only in the form of cash.
10.2 At the time of enrollment for a given Plan Year, a Participant shall
elect the method of payment desired upon the Expiration Date of the
deferral term(s) elected.
10.3 A Participant may choose either a lump sum or equal monthly
installment payment method for a given Plan Year.
10.4 The payment method elected shall cover all deferral terms, from all
deferral sources, for the respective Plan Year.
10.5 Should a Participant elect equal monthly installments, the
Participant must elect at the time of enrollment the length of time
over which installments are to be received.
10.6 The payment method and the installment period elected for deferrals
in a given Plan Year are irrevocable.
11.0 Account Statement
11.1 An Account Statement will be sent to each Participant quarterly until
the Participant's Account has been completely distributed.
12.0 Account Distribution
12.1 Payment will begin on the first payroll day of the month which first
follows a 30-day processing period beginning on the Expiration Date.
For lump sum payments no interest or credits will accrue during the
30-day processing period. For installment payments, interest will
accrue at the applicable interest rate for that Plan Year during the
30-day processing period.
12.2 Applicable federal, state, local and foreign taxes will be deducted
from the gross amount of the payment.
12.3 Equal monthly installments shall be at least $1,000. The
Administrator, therefore, shall have the right to reduce the length
of the installment period to that which provides an equal monthly
installment of at least $1,000.
12.4 For installment payments, interest will continue to be earned on the
undistributed balance in the Account at the interest rate established
for each Plan Year.
13.0 Hardship Distributions
13.1 Distribution of payments from an Employee's Account prior to the
Expiration Date shall be made only if the Administrator, after
consideration of an application by the Employee, determines that the
Employee has sustained financial hardship caused by events beyond the
Employee's control. In such event, the Administrator may, at his
sole discretion, direct that all or a portion of the Account be paid
to the Employee in such manner, and at such times as determined by
the Administrator.
14.0 Beneficiary Designation
14.1 A Participant shall have the right to designate one or more
beneficiaries and to change any beneficiary previously designated.
14.2 A Participant shall submit his or her beneficiary designation in
writing using the beneficiary designation portion of the enrollment
form. The Participant shall deliver the completed form to the
Administrator.
14.3 The most recently dated and filed beneficiary designation shall
cancel all prior designations.
14.4 In the event of the Participant's death before or after the
commencement of payments from the Account, the amount otherwise
payable to the Participant shall be paid to the designated
beneficiary(ies) of, if no beneficiary, to the estate, according to
the provisions of Section 12.0, as applicable.
15.0 General Provisions
15.1 Participant's Rights Unsecured. The right of any Participant to
receive payments under the provisions of this Plan shall be an
unsecured claim against the general assets of the Company. It is not
required or intended that the amounts credited to the Participant's
Account be segregated on the books of the Company or be held by the
Company in trust for a Participant and a Participant shall not have
any claim to or against a specific asset or assets of the Company.
All credits to an Account are for bookkeeping purposes only.
15.2 Non-assignability. The right to receive payments shall not be
transferrable or assignable by a Participant. Any attempted
assignment or alienation of payments shall be void and of no force or
effect.
15.3 Administration. The Administrator shall have the authority to adopt
rules, regulations and procedures for carrying out this Plan, and
shall interpret, construe and implement the provisions of the Plan
according to the laws of the State of Ohio.
15.4 Amendment and Termination. This Plan may at any time or from time to
time be amended or terminated. No amendment, modification or
termination shall adversely affect the Participant's rights under
this Plan.
15.5 Construction. The singular shall also include the plural where
appropriate.
15.6 Employment Rights. This Plan does not constitute a contract of
employment and participation in the Plan will not give any
Participant the right to be retained in the employ of the Company.
15.7 Annual Bonus Rights. This Plan does not confer the right for a
Participant to receive an Annual Bonus.
FIRST AMENDMENT TO THE
AMERICAN ANNUITY GROUP, INC.
DEFERRED COMPENSATION PLAN
(Effective as of July 1, 1994)
Pursuant to the reserved power of amendment contained in Section 15.4 of
the American Annuity Group, Inc. Deferred Compensation Plan (the "Plan"),
the Plan is hereby amended effective as of August 1, 1996, as follows:
1. Section 3.1 is amended by deleting the word "interest" and replacing
it with the phrase "earnings (or losses) determined under Article 9".
2. Section 3.9 of the Plan is deleted in its entirety and the remainder
of Article 3 is renumbered accordingly.
3. Section 6.2 is amending by deleting the phrase "(including all Excess
401(k) Deferrals), all interest earned on deferrals" and replacing it with
the phrase ", all earnings (or losses) determined under Article 9".
4. Section 7.1 is amended by deleting the phrase "consisting, for
purposes of this Plan, of one or more of the following three components:
Base Salary, Annual Bonus and Excess 401(k) Deferrals".
5. Section 7.3 is amended by deleting the phrase "and Excess 401(k)
Deferrals".
6. Section 8.1 is amended by deleting the phrase "for Base Salary or
Annual Bonus deferrals" and by deleting the last sentence of that section.
7. Article 9 is deleted in its entirety. In its place, the following
shall be substituted:
9.0 Crediting of Earnings
9.1 Effective August 1, 1996, there shall be credited
to the Account of each Participant an additional
amount of earnings (or losses) determined under
this Article 9. For all periods prior to August 1,
1996, the Participant's Account shall be credited
with earnings based on the Interest Option.
9.2 Each Participant shall elect (in whole percentages)
to have earnings (or losses) credited to his
Account under one (or a combination) of the
following investment elections:
(a) American Annuity Group Common Shares
(b) Interest Option
Such an election must be in writing, on a form
provided by the Administrator and delivered to the
Administrator prior to the beginning of the Plan
Year to which it relates. Notwithstanding the
foregoing, for the 1996 Plan Year only, a
Participant may provide such notice to the
Administrator no later than September 15, 1996, to
be effective as of August 1, 1996.
Subject to Paragraph 9.3, an investment election
shall be effective for the entire Plan Year to
which it relates and may not be modified or
terminated for that Plan Year. Notwithstanding the
foregoing, for the 1996 Plan Year only, subject to
Paragraph 9.3, a Participant's investment election
shall be effective from August 1, 1996 through
December 31, 1996. In the event that an investment
election form is not received by the Administrator
by the date specified for elections for a
particular Plan Year for a Participant, the last
investment election received by the Administrator
from the Participant shall remain in effect for
that Plan Year.
9.3 If a Participant elects to have some or all of his
Compensation deferrals for a Plan Year credited
with earnings (or losses) under the American
Annuity Group Common Shares investment option, that
election with respect to such Compensation
deferrals (and any earnings allocable to such
Compensation deferrals) may not be changed.
9.4 (a) The Administrator shall determine the rate of
return throughout each Plan Year for the investment
funds designated under Paragraph 9.2. The rates of
return shall be used to determine the earnings (or
losses) to be credited for that year, regardless of
the Plan Year from which the deferral was made.
(b) For each Plan Year, the Participant's Account
shall be increased or decreased as if it had earned
the rate of return corresponding to the amount
determined under Paragraph 9.4(a). Such increase
or decrease shall be based on the varying balances
in each of the investment elections comprising the
Participant's Account throughout the Plan Year and
shall be credited quarterly on the last day of each
March, June, September and December.
8. Section 10.1 is amended by the addition of a new paragraph at the end
thereof to read as follows:
Notwithstanding the foregoing, to the extent that a
Participant's Account is being credited with earnings (or
losses) under Article 9 based on the American Annuity Group
Common Shares investment option, such Participant shall
receive benefit payments in the form of whole shares of such
American Annuity Group Common Shares. Any fractional shares
shall be paid in cash. Any expenses attributable to a
payment in shares may be deducted from the Participant's
Account.
9. Section 12.1 is amended by deleting the last two sentences thereof
and by adding a new paragraph at the end to read as follows:
If a lump sum payment is elected, the Participant's Account
shall not be credited with earnings (or losses) under Article
9 during the 30-day processing period. If installment
payments are elected, the Participant's Account shall
continue to be credited with earnings (or losses) under
Article 9 during the 30-day processing period.
10. Section 12.4 is deleted in its entirety. In its place, the following
shall be substituted:
12.4 If installment payments are in effect, the
Participant's Account shall continue to be credited
with earnings (or losses) under Article 9 until
payment of the final installment and the
Participant may continue to make such elections
thereunder as are available to other Participants.
