75
EXHIBIT 10(c)
GREIF BROS. CORPORATION
DIRECTORS DEFERRED COMPENSATION PLAN
Effective
September 5, 1996
76
EXHIBIT 10(c) (continued)
GREIF BROS. CORPORATION
DIRECTORS DEFERRED COMPENSATION PLAN
(the "Plan")
I
PURPOSE
Greif Bros. Corporation (the "Company") is willing to provide
supplemental retirement benefits out of its general assets to members of
its Board of Directors (the "Board") as an incentive for those individuals
to continue their relationship with the Company and to provide them the
opportunity to defer the payment of their Board fees for retirement savings
purposes. The Company's goal is to retain and reward its Board members by
helping them to accumulate benefits for a comfortable retirement.
II
ELIGIBILITY
All members of the Board are eligible to participate in the Plan. If
you are eligible to participate in the Plan, you will sign a Deferred
Compensation Agreement which details the requirements you must satisfy to
be eligible to receive this supplemental retirement benefit from the
Company.
III
DEFERRED COMPENSATION ACCUMULATIONS
The benefits provided to Directors under their Deferred Compensation
Agreements are paid from the Company's general assets. The program is,
therefore, considered to be an "unfunded" arrangement as amounts are not
set aside or held by the Company in a trust, escrow, or similar account or
fiduciary relationship on your behalf. Each participant's rights to
benefits under the Plan are equivalent to the rights of any unsecured
general creditor of the Company. If the Company makes any investment of
funds in conjunction with this Plan, all such investments shall at all
times continue to be a part of the Company's general assets for all
purposes.
To measure the amount of the Company's obligations to a participant in
this program, the Company will maintain a bookkeeping record or account of
each participant's "Accumulations". You may elect (within 30 days of when
you first become eligible to participate in the Plan for your initial year
of participation or, for subsequent years, not later than the December 31
prior to each such year) to defer payment of a portion (minimum of 25%) or
all of your director's fees to be earned during the balance of the current
or next calendar year, as applicable, as a credit to your Accumulations.
77
EXHIBIT 10(c) (continued)
If you desire, your election can continue in effect from year to year
until you change it, but any change will be effective only as of the
January 1 of the year following the year you change your election. Your
election will apply to your periodic (quarterly) fee for service on the
Board, or to fees you earn for attendance at meetings of the Board or of
any committee of the Board, or to both, as you elect. These credits to
your Accumulations, adjusted for changes in capitalization and dividends,
as described below, are known as the "Deferral Value."
Value of Your Accumulations: The amount payable to you when you
retire from the Board will be based on the value credited to your
Accumulations account. Your Deferral Value will be credited as "Phantom
Shares." "Phantom Shares" shall have a value equal to the market value
from time to time of the Company's Class A Common Stock, without par value.
The number of Phantom Shares credited to your account will be based on the
dollar amount of the fees being deferred, divided by the then current per
share value of the Company's Class A Common Stock, without par value. For
example, if you are deferring $1,000 of fees at a time when the per share
value of the Company's Class A Common Stock is $40, your account will be
credited with 25 Phantom Shares ($1,000 divided by 40 = 25).
The value of your Accumulations will be based on the value of the
Company's Class A Common Stock, without par value, as determined from time
to time. If there is a change in the capitalization structure of the
Company (e.g., due to a stock dividend, stock split, recapitalization,
merger, consolidation, etc.), then a corresponding equitable adjustment
will be made in the number of Phantom Shares credited to your account. The
Phantom Shares will also have dividend rights comparable to the Company's
Class A Common Stock, in the Company's discretion. If any dividends are
declared on the Phantom Shares, they will automatically be treated as
though they were reinvested in additional Phantom Shares. The Company also
reserves the right to adjust the earnings or other amounts credited to
your Accumulations and to determine the value of your Accumulations as of
any date by adjusting such earnings or fair market value for the Company's
tax and other costs of providing this Plan.
Hypothetical dividends and earnings credited to your account will
compensate for the postponement of the receipt of the Accumulations and
give you the benefit of tax-deferred growth of the accumulating amounts.
Under current federal income tax rules, the amounts credited to your
Accumulations, including earnings, will not be taxable income to you in the
year they are credited to your account. You, or your beneficiaries in the
event of your death, will generally be taxable on these amounts and the
credited earnings only if and when benefits are actually paid to you.
Thus, this program provides the opportunity to defer income and the payment
of income taxes.
78
EXHIBIT 10(c) (continued)
IV
BENEFITS
A. Vesting. All contributions to the Plan will always be 100% "vested".
This means you will always be entitled to receive benefits from your
Accumulations.
B. Payment of Benefits.
1. Retirement Benefits. You will be eligible to receive retirement
benefits under the plan upon your retirement from the Board after
attaining age 65. Retirement benefits will generally be paid in
cash either in a single lump sum or as a monthly benefit payable
for 120 months. The amount of monthly benefit payments will
equal the amount necessary to amortize your total Accumulations
over the 120 month period. The amount payable each month will be
based alternatively on an approximately equal amortization based
on an assumed interest rate declared by the Company from time to
time during the period of distribution, or based on the actual
investment results of a like sum invested by the Company. If the
Company elects to invest funds equal to your Accumulations, the
funds shall remain an asset solely of the Company for all
purposes. In this event, monthly installments payable during a
calendar year shall be based on the fair market value of the
Company's investments as of the preceding December 31, divided by
the number of monthly installments remaining to be paid. You
must give the Company at least 30 days advance written notice of
your intention to retire and receive retirement benefits. Actual
benefit payments will begin no later than the first day of the
second month following your satisfaction of all requirements for
payment.
2. Disability Benefits. If you become totally disabled before
satisfying the requirements for retirement benefits, you will be
eligible to receive payment of the amounts credited to your
Accumulations in a single lump sum or as a monthly benefit
payable for 120 months. The amount of any monthly benefits will
be determined in the same manner as retirement benefits. For
this purpose, "total disability" means a physical or mental
condition which totally and presumably permanently prevents you
from engaging in your usual occupation or any occupation for
which you are qualified by reason of training, education, or
experience. It is up to the Company to determine whether you
qualify as being totally disabled and the Company may require you
to submit to periodic medical examinations to confirm that you
are, and continue to be, totally disabled. If your disability
ends, your disability benefit payments will stop. However, you
could continue to qualify for benefits under another provision of
the Plan.
79
EXHIBIT 10(c) (continued)
3. Death Benefits. In the event of your death while receiving
benefit payments under the Plan, the Company will pay the
beneficiary or beneficiaries designated by you any remaining
payments due under the terms of your Deferred Compensation
Agreement, using the same method of distribution in effect to you
at the date of your death. In the event of death prior to
beginning to receive benefits under the Deferred Compensation
Agreement, the Company will pay benefits to your beneficiary or
beneficiaries, beginning as soon as practicable after your death.
In this case, benefits will be paid in a single lump sum or as a
monthly benefit payable for 120 months computed in the same
manner as retirement benefits. The Company will provide you with
the form for designating your beneficiary or beneficiaries. If
you fail to make a beneficiary designation, or if your designated
beneficiary predeceases you or cannot be located, any death
benefits will be paid to your estate.
4. Other Termination of Board Membership. If your membership on the
Board terminates for any reason other than retirement, death, or
total disability, then your Accumulations will be paid to you in
a single lump sum or as a monthly benefit payable for 120 months
computed in the same manner as retirement benefits, beginning as
soon as administratively practicable after your term of office
ends.
5. Payment Alternatives. Whether your benefits are payable as
single lump sum or in installments for 120 months will be
determined by an election you make when you first are eligible
for this plan. Once made, your election of a payment method may
not be changed. However, at the Company's election, or upon your
request and the Company's consent, benefits may be paid over a
shorter or longer period of time than you elected. However, no
request by you or your beneficiaries for a different payment
method will be binding on the Company, and any accelerated or
deferred payment of benefits shall be made only in the sole
discretion of the Company. In addition, the Company may alter
the payment method in effect from time to time in its discretion.
If the payment method is altered, the amount you or your
beneficiaries will receive will be computed under one of the
alternative methods for determining payment amounts provided for
under the normal installment payment form of distribution for
your Accumulations, determined by the Company in its discretion.
80
EXHIBIT 10(c) (concluded)
6. Insider Trading Rules. The federal securities laws now treat
"derivative" securities, such as the Phantom Shares, as subject
to the restrictions on "insider trading." To qualify for an
exemption from the insider trading rules, Phantom Shares must be
held for at least 6 months. Therefore, distribution to you of
amounts deferred within 6 months of your retirement or other
termination from the Board will be delayed until 6 months after
the date of deferral. This special rule will not delay the
payment of amounts deferred more than 6 months before your
retirement or other termination.
V
MISCELLANEOUS PROVISIONS
A. No Right to Company Assets. As explained previously, this Directors
Deferred Compensation Plan is an unfunded arrangement and the
agreement you will enter into with the Company does not create a trust
of any kind or a fiduciary relationship between the Company and you,
your designated beneficiaries or any other person. To the extent you,
your designated beneficiaries, or any other person acquires a right to
receive payments from the Company under the Directors Deferred
Compensation Agreement that right is no greater than the right of any
unsecured general creditor of the Company.
B. Modification or Revocation. Your Directors Deferred Compensation
Agreement will continue in effect until revoked, terminated, or all
benefits are paid. However, the Deferred Compensation Agreement and
this Plan may be amended or revoked at any time, in whole or in part,
by the Company in its sole discretion. Unless you agree otherwise,
you will still be entitled to the benefit, if any, that you have
earned through the date of any amendment or revocation. Such benefits
will be payable at the times and in the amounts provided for in the
Deferred Compensation Agreement, or the Company may elect to
accelerate distribution and pay all amounts due immediately.
C. Rights Preserved. Nothing in the Deferred Compensation Agreement or
this Plan gives any director the right to continue to hold such
office. The relationship between you and the Company shall continue
to be determined by the applicable provisions of the Articles of
Incorporation and Code of Regulations of the Company and by applicable
law.
D. Controlling Documents. This is merely a summary of the key provisions
of the Deferred Compensation Agreement currently in use by the
Company. In the event of any conflict between the provisions of this
Plan and the Deferred Compensation Agreement, the agreement shall in
all cases control.