Exhibit 10.45

 

BURLINGTON NORTHERN SANTA FE CORPORATION

 

NON-EMPLOYEE DIRECTORS’ COMPENSATION FOR 2006

 

Directors’ Compensation

 

On February 14, 2006, the Board, after review of competitive compensation levels
and director responsibilities, revised certain elements of the compensation to
be received by non-employee directors through fees, equity, and other programs
as described below. Non-employee directors continue to receive an annual
retainer fee of $60,000, paid in quarterly installments. The Chairman of the
Audit Committee is paid a supplemental annual retainer fee, which was increased
from $10,000 to $15,000, and each director who chairs any other Board committee
is paid a supplemental annual retainer fee, which was increased from $5,000 to
$10,000. In addition, for attendance at each Committee meeting or any inspection
trip or similar meeting, a meeting fee of $1,000 plus expenses continues to be
paid, including expenses for attendance by spouses in connection with certain
meetings. Directors who are also officers or employees of the Company receive no
compensation for duties performed as a director or a committee chairman.

 

Burlington Northern Santa Fe Directors’ Retirement Plan

 

The Directors’ Retirement Plan was terminated as of July 17, 2003. The plan
provided non-employee directors an annual benefit if they served as a member of
the Board for ten consecutive years, attained the mandatory retirement age, or
were designated by the Directors and Corporate Governance Committee as eligible
for benefits. Individual participants who met the eligibility requirements of
the Retirement Plan are eligible to receive annual payments for benefits accrued
through July 17, 2003. The annual payment is the amount of the annual retainer
for services as a Board member at the time of termination of service for those
individuals who are already retired. Non-employee members of the Board who meet
the eligibility requirements will receive an annual payment in the amount of
$40,000 upon departure from the Board, which was the amount of the annual
retainer for services as a Board member at the time the Retirement Plan was
terminated. Payment ceases upon an individual’s death. Service as a member on
the board of directors of one or more of BNSF’s predecessor companies counts
toward the requirement of ten consecutive years of service.

 

An individual Board member as of July 17, 2003, who had not served as a member
of the Board for a period of at least ten consecutive years as of such date and
had not attained age 72 as of July 17, 2003, but who subsequently meets the
eligibility requirements, will be entitled to receive a pro rata annual payment
for benefits at the time of departure from the Board. See Exhibit 10.23 to this
Form 10-K.

 

Burlington Northern Santa Fe Non-Employee Directors’ Stock Plan

 

Under the Plan, each non-employee director is entitled to receive a one-time
grant of 1,000 Restricted Stock Units as of the annual meeting at which he or
she is first elected to the Board.

 

On February 14, 2006, the Board of Directors amended the Plan to reduce the
number of Restricted Stock Units granted to each non-employee director elected
to the Board of Directors at the 2006 annual meeting and each subsequent annual
meeting, from 2,500 Restricted Stock Units to 2,100 units. As previously
provided by the Plan, if an individual becomes a director on a date other than
the date of the annual meeting, he or she will receive a pro rata grant of
Restricted Stock Units for the portion of the one-year term following the date
on which the individual becomes a director. The Restricted Stock Units will vest
upon the date the director’s term of service ends by reason of retirement,
death, disability, or change in control, subject to the director having served
on the Board at least until the next annual meeting following election to the
Board. Upon vesting, the director will receive one share of the Company’s common
stock for each Restricted Stock Unit. Directors holding Restricted Stock Units
do not have any rights of a shareholder but have the right to receive a cash
payment in lieu of a dividend at such times and in such amounts as dividends are
paid on the Company’s common stock.

 

Prior to 2004, the Non-Employee Directors’ Stock Plan also permitted directors
by timely election to forego up to 25 percent of their annual retainer and
receive a Retainer Stock Award in the form of restricted stock equal to 150
percent of the amount foregone based on the fair market value of BNSF’s common
stock on the date of grant (December 31 of each calendar year), to vest three
years from the date of grant, or

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earlier if a director left the Board by reason of retirement, death, disability,
or change in control. All Retainer Stock Awards will vest by December 31, 2006.
See Exhibit 10.1 to this Form 10-K.

 

Burlington Northern Santa Fe Deferred Compensation Plan for Directors and
Burlington Northern Santa Fe 2005 Deferred Compensation Plan for Non-Employee
Directors

 

Prior to 2005, under the Deferred Compensation Plan for Directors, non-employee
directors could voluntarily defer all or a portion of the fees they would
otherwise receive into a Prime Rate interest account, a Company stock-equivalent
(phantom stock) account or other investment option established under the plan’s
terms, which now includes an S&P 500 index fund and a long-term capital
appreciation stock fund. Participants receive subsequent distributions from the
Company in amounts determined by reference to the investment options chosen.
Distributions will be made in cash in either annual installments or as a lump
sum after a director’s departure from the Board. Participation in this plan is
frozen, and no new contributions may be made under the plan after December 31,
2004. See Exhibit 10.3 to this Form 10-K.

 

On April 21, 2005, the Board established the 2005 Deferred Compensation Plan for
Non-Employee Directors, which has substantially the same provisions and
investment options as did the Deferred Compensation Plan for Directors, but with
additional provisions which comply with Section 409A of the Internal Revenue
Code. See Exhibit 10.40 to this Form 10-K.