NORFOLK SOUTHERN CORPORATION

LONG-TERM INCENTIVE PLAN

AS AMENDED JANUARY 1, 2009

 

Section 1.        PURPOSE

            The purpose of the Long-Term Incentive Plan ("Plan"), as amended, is
to promote the success of Norfolk Southern Corporation (the "Corporation") and
to provide an opportunity for officers and other key employees of the
Corporation and its Subsidiary Companies (as hereinafter defined) to acquire or
increase a proprietary interest in the Corporation and thereby to provide an
additional incentive to officers and other key employees to devote their maximum
efforts and skills to the advancement, betterment, and prosperity of the
Corporation and its shareholders. The Plan provides for the grant of incentive
stock options, non-qualified stock options, stock appreciation rights,
performance share units, performance shares, shares of the Corporation's common
stock (restricted pursuant to the provisions of Section 9 of the Plan) and
restricted stock units, in accordance with the terms and conditions set forth
below. The Corporation intends that the Plan comply with the requirements of
Internal Revenue Code Section 162(m) and applicable treasury regulations
thereunder and intends that compensation paid under the Plan qualify as
performance-based compensation under Code Section 162(m). Notwithstanding the
preceding sentence, the Corporation reserves the right to pay compensation under
the Plan that does not qualify as performance-based compensation under Code
Section 162(m), as circumstances may warrant.  The Plan, as amended, is
intended, and shall be construed, to comply with the requirements of Code
Section 409A.

Section 2.        DEFINITIONS

            The terms used herein shall have the following meanings unless
otherwise specified or unless a different meaning is clearly required by the
context:

Award

Any one or more of the following: Incentive Stock Option; Non-qualified Stock
Option; Stock Appreciation Right; Restricted Shares; Restricted Stock Units;
Performance Share Units; and Performance Shares.

 

Beneficiary

The person or persons designated in writing by the Participant as his
Beneficiary in respect of Awards or, in the absence of such a designation or if
the designated person or persons predecease the Participant, the person or
persons who shall acquire the Participant's rights in respect of Awards by
bequest or inheritance in accordance with the applicable laws of descent and
distribution. In order to be effective, a Participant's designation of a
Beneficiary must be on file with the Corporation before the Participant's death.
Any such designation may be revoked and a new designation substituted for the
revoked designation by the Participant at any time before his death without the
consent of the previously designated Beneficiary.

 

Board of

Directors

 

The Board of Directors of the Corporation.

Cash-Settled Stock Appreciation Rights

 

Stock Appreciation Rights settled in cash.

Code

The Internal Revenue Code of 1986, as amended from time to time.

 

Committee

The Compensation Committee or any other committee of the Board of Directors
which is authorized to grant Awards under this Plan. The Committee must be
composed solely of two or more outside directors, as defined under Code Section
162(m) and applicable regulations thereunder.

 

Common Stock

The Common Stock of the Corporation.

 

Disability

A disability that has enabled the Participant to receive a disability benefit
under the Long-Term Disability Plan of the Corporation or a long-term disability
plan of a Subsidiary Company (whichever is applicable), as amended from time to
time, for a period of at least three months.

 

Dividend

Equivalent

An amount equal to the regular quarterly dividend paid in accordance with the
Corporation's normal dividend payment practice as may be determined by the
Committee, in its sole discretion.

 

Executive Officers

Officers designated by the Board of Directors as "Executive Officers" for
purposes of Section 16 of the Securities Exchange Act of 1934.

 

Exercise Gain

Shares

With respect to a Stock Appreciation Right, all of the shares of Common Stock
received upon exercise of the Stock Appreciation Right.  With respect to an
Option, the portion of the shares of Common Stock received upon exercise of the
Option equal to the excess of the Fair Market Value, as of the exercise date,
over the Option price, multiplied by the number of shares purchased under the
Option on the exercise date, divided by such Fair Market Value, and rounded down
to the nearest whole number of shares.

 

Fair Market Value

The value of Common Stock on a particular date as measured by the mean of the
high and low prices at which it is traded on such date as reported in the
Composite Transactions for such date by Bloomberg L.P., or its successor, on its
internet-based service, or, if Common Stock was not traded on such date, on the
next preceding day on which Common Stock was traded.

 

Incentive Stock Option

An Option that complies with the terms and conditions set forth in Section
422(b) of the Code and is designated by the Committee as an Incentive Stock
Option.

 

Non-Qualified

Stock Option

 

An Option granted under the Plan other than an Incentive Stock Option.

Option

Any option to purchase Common Stock granted pursuant to the provisions of
Section 6 or Section 7 of the Plan.

 

Optionee

A Participant who is the holder of an Option.

 

Participant

Any officer or key employee of the Corporation or a Subsidiary Company selected
by the Committee to participate in the Plan and any non-employee director of the
Corporation.

 

Performance Cycle

The period of time, designated by the Committee, over which Performance Shares
may be earned.

 

Performance Criteria

One or more, or any combination, of the following business criteria, selected by
the Committee, which may be applied on a corporate, department or division
level: earnings measures (including net income, earnings per share, income from
continuing operations, income before income taxes, income from railway
operations); return measures (including net income divided by total assets,
return on shareholder equity, return on average invested capital); cash flow
measures (including operating cash flow and free cash flow); productivity
measures (including total operating expense per thousand gross ton miles or
revenue ton miles, total operating revenue per employee, total operating expense
per employee, gross ton miles or revenue ton miles per employee, carloads per
employee, revenue ton miles per mile of road operated, total operating expense
per carload, revenue ton miles per carload, gross ton miles or revenue ton miles
per train hour, percent of loaded-to-total car miles); fair market value of
shares of the Corporation's Common Stock; revenue measures; expense measures;
operating ratio measures); customer satisfaction measures; working capital
measures; cost control measures; total shareholder return measures; and safety
measures.

 

Performance  Criteria Weighting Percentage

The percentage weighting accorded to each Performance Criterion (or each
combination thereof) selected by the Committee. The total of the Performance
Criteria Weighting Percentages for any type of Award shall equal one hundred
percent (100%).

 

Performance Goal

The specific target set by the Committee for each selected Performance Criterion
(or each combination thereof). A Performance Goal may be set solely with respect
to the Corporation's performance, or as compared to the performance of a
published or special index deemed applicable by the Committee, including but not
limited to the Standard & Poor's 500 Stock Index or an index based on a group of
comparative companies.

 

Performance   Shares

Shares of Common Stock granted pursuant to Section 11 of the Plan, which may be
made subject to the restrictions and other terms and conditions prescribed in
Section 11 of the Plan.

 

Performance Share Units

 

Contingent rights to receive Performance Shares pursuant to Section 11 of the
Plan.

Restricted Shares

Shares of Common Stock granted pursuant to Section 9 of the Plan and subject to
the restrictions and other terms and conditions set forth therein.

 

Restricted Stock Unit

Contingent rights, granted pursuant to Section 10 of the Plan, to receive
Restricted Stock Unit Shares or cash payment for the Fair Market Value of shares
of Common Stock, subject to the restrictions and other conditions set forth
herein. Each Restricted Stock Unit shall equal the Fair Market Value of one
share of Common Stock.

 

Restricted Stock Unit Shares

Shares of Common Stock issued as payment for Restricted Stock Units pursuant to
Section 10 of the Plan, which may be made subject to the restrictions and other
terms and conditions prescribed in Section 10 of the Plan.

 

Restriction Period

A period of time not less than thirty-six (36) nor more than sixty (60) months,
to be determined within those limits by the Committee in its sole discretion,
commencing on the date as of which Restricted Shares or Restricted Stock Units
are granted, during which the restrictions imposed by paragraphs (b) and (c) of
Section 9 or paragraphs (b) and (c) of Section 10 of the Plan shall apply. The
Committee shall determine whether to impose a Restriction Period and the length
of the Restriction Period at the time that the Restricted Shares or Restricted
Stock Units are granted. Such Restriction Period, if any, shall be incorporated
in the Restricted Share Agreement or Restricted Stock Unit Agreement setting
forth the grant. Under Sections 9 and 10 of this Plan, the Committee may, in its
discretion, specify when the Award is granted that the Restriction Period shall
expire upon the earlier achievement of Performance Goals.

 

Retirement

Retirement from the Corporation and all Subsidiary Companies pursuant to the
provisions of the Retirement Plan of the Corporation or a retirement plan of a
Subsidiary Company (whichever is applicable), as amended from time to time.

 

Share Retention Agreement

 

An agreement entered into pursuant to Section 12 of the Plan.

Stock Appreciation Right

The right, granted pursuant to the provisions of Section 8 of the Plan, to
receive Exercise Gain Shares or a cash payment equal to the excess, if any, of
the Fair Market Value of Common Stock on the exercise date over the Fair Market
Value of the Common Stock on the grant date, as specified in Section 8 of the
Plan.

 

Stock-Settled Stock Appreciation Rights

 

Stock Appreciation Rights paid out in Exercise Shares.

 

Subsidiary Company

A corporation of which at least fifty percent (50%) of the total combined voting
power of all classes of stock entitled to vote is owned, directly or indirectly,
by the Corporation.

 

Section 3.        ADMINISTRATION

            The Plan shall be administered by the Committee, which, subject to
the limitations set forth herein, shall have the full and complete authority and
sole discretion, except as may be delegated to the Corporation's chief executive
officer as provided herein, from time to time to construe and interpret the
Plan; to select the officers, key employees and non-employee directors who shall
be granted Awards under the Plan; to determine the type, size, terms, and
conditions of the Award or Awards to be granted to each such Participant; to
authorize the grant of such Awards pursuant to the Plan; in connection with the
merger or consolidation of the Corporation (and subject to any applicable
requirements of Code Section 409A), to give a Participant an election to
surrender an Award in exchange for the grant of a new Award; to adopt, amend and
rescind rules and regulations relating to the Plan; and to make all other
determinations and take all other actions it may deem necessary or advisable for
the implementation and administration of the Plan. The Committee in its sole
discretion may delegate authority to the Corporation's chief executive officer
to select the officers and key employees who shall be granted Awards under the
Plan (provided, however, that only the Committee shall grant Awards to the chief
executive officer and Executive Officers); to determine the type, size, terms,
and conditions of the Award or Awards to be granted to each such Participant;
and to authorize the grant of such Awards pursuant to the Plan, in which case
the chief executive officer shall have the full and complete authority to act on
the Committee's behalf to the extent so delegated. The Committee, or the chief
executive officer to the extent as may be delegated by the Committee
(hereinafter, the term "Committee" shall include reference to the chief
executive officer to the extent of any such delegation), may authorize the grant
of more than one type of Award, and Awards subject to differing terms and
conditions, to any eligible Participant. The Committee's decision to authorize
the grant of an Award to a Participant at any time shall not require the
Committee to authorize the grant of an Award to that Participant at any other
time or to any other Participant at any time; nor shall its determination with
respect to the size, type, or terms and conditions of the Award to be granted to
a Participant at any time require it to authorize the grant of an Award of the
same type or size or with the same terms and conditions to that Participant at
any other time or to any other Participant at any time. The Committee shall not
be precluded from authorizing the grant of an Award to any eligible Participant
solely because the Participant previously may have been granted an Award of any
kind under the Plan.

            All determinations of the Committee shall be by a majority of its
members and shall be final, conclusive and binding. Each member of the
Committee, while serving as such, shall be considered to be acting in his
capacity as a director of the Corporation, and no member of the Committee shall
be liable for any action taken or decision made in good faith with respect to
the implementation or administration of the Plan.

Section 4.        ELIGIBILITY

            To be eligible for selection by the Committee to participate in the
Plan, an individual must be a full-time salaried officer or key employee of the
Corporation, or of a Subsidiary Company, and must reside in the United States or
Canada, on the date on which the Committee authorizes the grant to such
individual of an Award. A non-employee director shall be eligible to participate
in the Plan if he or she is a director of the Corporation and is not a full-time
salaried employee of the Corporation or a Subsidiary Company on the date on
which the Committee authorizes the grant of an Award to non-employee directors.

Section 5.        SHARES AVAILABLE

            Effective May 10, 2001, an additional 30,000,000 shares of Common
Stock were approved for issuance pursuant to the Plan, and no more than
6,000,000 of such additional shares could be awarded as Restricted Shares or
Performance Shares. Subject to approval of the Plan, as hereby amended, by the
separate vote of the holders of a majority of the shares of Common Stock present
or represented and entitled to vote at a meeting of the stockholders of the
Corporation, at which a quorum for the proposal is present, not more than
8,500,000 of the shares remaining available for issuance under the Plan on the
date of such approval may be awarded as Restricted Shares, Performance Shares or
Restricted Stock Unit Shares. Such shares shall be provided from shares of
Common Stock authorized but not issued. Stock Appreciation Rights to be settled
in shares of Common Stock shall be counted in full against the number of shares
available for award under the Plan, regardless of the number of Exercise Gain
Shares issued upon settlement of the Stock Appreciation Right. Any shares of
Common Stock which were subject to an Option, a Performance Share Unit, or a
Restricted Stock Unit and which were not issued as Common Stock prior to the
expiration of the Award shall thereafter again be available for award under the
Plan. Any shares of Common Stock which were subject to a Stock Appreciation
Right to be settled in shares of Common Stock shall again be available for award
under the Plan after expiration or forfeiture of an Award. Upon the forfeiture
of any Restricted Shares, the forfeited shares of Common Stock shall thereafter
be available for award under the Plan. Notwithstanding any other provision to
the contrary, no Participant may be awarded a grant in any one year, which, when
added to any other grant of Options, Stock Appreciation Rights, Restricted
Shares, Restricted Stock Units and Performance Share Units in the same year,
shall exceed 1,500,000 shares of Common Stock. If an Option is canceled, the
canceled Option continues to count against the maximum number of shares for
which Options may be granted to a Participant in any year. The settlement in
cash of Restricted Stock Units, Performance Share Units and Stock Appreciation
Rights shall not be counted against the total number of shares available under
this Section 5 for issuance under the Plan.

Section 6.        INCENTIVE STOCK OPTIONS

(a)        General - The Committee may authorize the grant of Incentive Stock
Options subject to the terms and conditions set forth in this Section 6. The
grant of an Incentive Stock Option shall be evidenced by a written Stock Option
Agreement between the Corporation and the Optionee, setting forth the number of
shares of Common Stock subject to the Incentive Stock Option evidenced thereby
and the terms, conditions, and restrictions applicable thereto. The issuance of
shares of Common Stock pursuant to an Incentive Stock Option also shall be
subject to the provisions of any Share Retention Agreement that may be required
by the Committee under Section 12 of the Plan.

                        Except for adjustments pursuant to Section 15 of the
Plan, the Option Price for any outstanding Incentive Stock Option granted under
the Plan may not be decreased after the date the Option is granted, nor may an
outstanding Option be modified or replaced if the effect would be to reduce the
Option Price, unless such repricing, modification or replacement is approved by
the vote of a majority of the shares of Common Stock present or represented and
entitled to vote at a meeting of the stockholders of the Corporation at which a
quorum is present.

(b)        Option Price - The Committee shall determine the Option price for
each share of Common Stock purchased under an Option, but, subject to the
provisions of Section 14 of the Plan, in no event shall the Option price be less
than one hundred percent (100%) of the Fair Market Value of the Common Stock on
the date the Option is granted.

(c)        Duration of Options - The Committee shall fix the term or duration of
Options, provided that such term shall not exceed ten (10) years from the date
the Option is granted, and that such term shall be subject to earlier
termination pursuant to the provisions of paragraph (g) of this Section 6 or
paragraph (e) of Section 8 of the Plan.

(d)        Non-Transferability of Options - Options are not transferable other
than by will or the applicable laws of descent and distribution following the
death of the Optionee. Options may be exercised during the lifetime of the
Optionee only by him, and following his death only by his Beneficiary.

(e)        Exercise of Options - The Committee shall determine the time or times
at which Options may be exercised; provided that such time or times shall not
occur before the latest of:

(i)  the first anniversary of the date on which the Option was granted; and

(ii) the effectiveness of any registration statement required to be filed under
the Securities Act of 1933 for the registration of the Common Stock to be issued
upon exercise of the Option.

(f)        Payment of Option Price - The purchase price of Common Stock upon
exercise of an Option shall be paid in full to the Corporation at the time of
the exercise of the Option in cash or, at the discretion of the Committee and
subject to any limitations or requirements that the Committee may adopt, by the
surrender to the Corporation of shares of previously acquired Common Stock,
which have been held by the Optionee for at least twelve (12) months and which
shall be valued at Fair Market Value on the date that the Option is exercised,
or, at the discretion of the Committee, by a combination of cash and such Common
Stock.

(g)        Termination of Options - No Option shall be exercisable after it
expires. Each Option shall expire upon the earliest of:

(i) the expiration of the term for which the Option was granted;

(ii)  (A) Except as otherwise provided by the Committee, in the case of an
Optionee whose employment with the Corporation or a Subsidiary Company is
terminated due to Retirement, Disability or death, the expiration of thirty-six
(36) months after such termination of employment, or

      (B) in the case of an Optionee whose employment with the Corporation or a
Subsidiary Company is terminated for any reason other than Retirement,
Disability, or death, at the close of business on the last day of active service
by the Optionee with the Corporation or a Subsidiary Company, or

      (C) in the case of an Optionee who is granted a leave of absence, if the
Optionee's employment with the Corporation or a Subsidiary Company terminates at
any time during or at the end of the leave of absence, at the close of business
on the last day of employment with the Corporation or a Subsidiary Company, or

(iii) in connection with a merger or consolidation of the Corporation, with the
Optionee's consent, the grant of a new Award to replace the Option.

(h)        Limitation on Exercisability - The aggregate Fair Market Value
(determined as of the time the Incentive Stock Option is granted) of the Common
Stock with respect to which Incentive Stock Options (granted on or after January
1, 1987) are exercisable for the first time by the Optionee during any calendar
year shall not exceed $100,000, as adjusted under Code Section 422(d)(1) and
corresponding Treasury Regulations.

Section 7.        NON-QUALIFIED STOCK OPTIONS

              The Committee may authorize the grant of Non-Qualified Stock
Options subject to the terms and conditions specified in this Section 7. The
grant of a Non-Qualified Stock Option shall be evidenced by a written
Non-Qualified Stock Option Agreement between the Corporation and the Optionee,
setting forth the number of shares of Common Stock subject to the Non-Qualified
Stock Option evidenced thereby and the terms, conditions, and restrictions
applicable thereto. Non-Qualified Stock Options granted pursuant to the
provisions of this Section 7 shall be subject to the terms, conditions, and
restrictions set forth in paragraphs (a) through (g) of Section 6 of the Plan.
The limitations set forth in paragraph (h) of Section 6 of the Plan shall not
apply to Non-Qualified Stock Options. The issuance of shares of Common Stock
pursuant to a Non-Qualified Stock Option also shall be subject to the provisions
of any Share Retention Agreement that may be required by the Committee under
Section 12 of the Plan.

Section 8.        STOCK APPRECIATION RIGHTS

(a)        General - The Committee may grant a Stock Appreciation Right to a
Participant in connection with an Option, or portion thereof, or on a stand
alone basis, as determined by the Committee, subject to the terms and conditions
set forth in this Section 8. If granted in connection with an Option, the Stock
Appreciation Right may be granted at the time of grant of the related Option and
shall be subject to the same terms and conditions as the related Option, except
as this Section 8 may otherwise provide. If granted in connection with an
Option, the Stock Appreciation Right shall be evidenced either by provisions in
the Stock Option Agreement evidencing the related Option or by a written Stock
Appreciation Right Agreement between the Corporation and the Optionee,
identifying the related Option, specifying the number of shares of Common Stock
subject thereto and setting forth the terms and conditions applicable to the
Stock Appreciation Right. If granted on a stand alone basis, the Stock
Appreciation Right shall be evidenced by provisions of a written Stock
Appreciation Right Agreement between the Corporation and the Participant. The
Committee may grant Cash-Settled Stock Appreciation Rights or Stock-Settled
Stock Appreciation Rights as shall be set forth in an Option Agreement or Stock
Appreciation Right Agreement.

(b)        Exercise - If granted in connection with an Option, a Stock
Appreciation Right shall be exercisable only at such time or times, to such
extent, and by such persons, as the Option to which it relates shall be
exercisable. If granted on a stand alone basis, a Stock Appreciation Right shall
be exercisable only at such time or times, to such extent, and by such persons,
as shall be set forth in the Stock Appreciation Right Agreement.

            Stock Appreciation Rights shall be subject to the following
restrictions:

            (i) the Stock Appreciation Right may not be exercised before the
expiration of one (1) year from the date on which it was granted; provided,
however, that this subparagraph (i) shall not apply if the death or Disability
of the Optionee occurs within one (1) year after the grant of the Stock
Appreciation Right; and,

            (ii) a Stock Appreciation Right granted in connection with an
Incentive Stock Option may not be exercised on any date on which the Fair Market
Value of a share of Common Stock is less than or equal to the Option price per
share under the related Incentive Stock Option.

                        A Stock Appreciation Right shall be exercised by
providing the Corporation with a written notice in such form and containing such
information (including the number of shares of Common Stock with respect to
which the Stock Appreciation Right is being exercised) as the Committee may
specify. If the Stock Appreciation Right was granted in connection with an
Option, the Participant must surrender the related Option, or the portion
thereof pertaining to the shares with respect to which the Stock Appreciation
Right is exercised, and the date on which the Corporation receives such notice
shall be the date on which the related Option, or portion thereof, shall be
deemed surrendered and the Stock Appreciation Right shall be deemed exercised.

            (c)        Payment - Upon the proper exercise of a Stock-Settled
Stock Appreciation Right granted on a stand alone basis, a Participant shall be
entitled to receive Exercise Gain Shares equal to the number of shares of Common
Stock that have an aggregate Fair Market Value on the exercise date equal to the
amount by which the Fair Market Value of a share of Common Stock on the exercise
date exceeds the Fair Market Value of a share of Common Stock on the grant date,
multiplied by the number of Stock- Settled Stock Appreciation Rights surrendered
in connection with the exercise of the Stock Appreciation Right.

                        Upon the proper exercise of a Stock-Settled Stock
Appreciation Right granted in connection with an Option, an Optionee shall be
entitled to receive Exercise Gain Shares equal to the number of shares of Common
Stock that have an aggregate Fair Market Value on the exercise date equal to the
amount by which the Fair Market Value of a share of Common Stock on the exercise
date exceeds the Option price per share of the related Option, multiplied by the
number of shares covered by the related Option, or portion thereof, surrendered
in connection with the exercise of the Stock Appreciation Right. The Exercise
Gain Shares shall be subject to the provisions of any Share Retention Agreement
that may be required by the Committee under Section 12 of the Plan.

                        Upon the proper exercise of a Cash-Settled Stock
Appreciation Right granted on a stand alone basis, a Participant shall be
entitled to receive cash equal to the value of the number of shares of Common
Stock that have an aggregate Fair Market Value on the exercise date equal to the
amount by which the Fair Market Value of a share of Common Stock on the exercise
date exceeds the Fair Market Value on the grant date, multiplied by the number
of Cash-Settled Stock Appreciation Rights surrendered for settlement.

                        Upon the proper exercise of a Cash-Settled Stock
Appreciation Right granted in connection with an Option, an Optionee shall be
entitled to receive cash equal to the value of the number of shares of Common
Stock that have an aggregate Fair Market Value on the exercise date equal to the
amount by which the Fair Market Value of a share of Common Stock on the exercise
date exceeds the Option price per share of the related Option, multiplied by the
number of shares covered by the related Option, or portion thereof, surrendered
in connection with the exercise of the Stock Appreciation Right.

            (d)        Termination of Right - A Stock Appreciation Right granted
in connection with an Option shall expire, unless previously exercised or
canceled, upon the expiration of an Option to which it relates, or upon such
time as may be set forth in a Stock Appreciation Right Agreement. A Stock
Appreciation Right granted on a stand alone basis shall be subject to the
termination provisions set forth in paragraph (g) of Section 6 for Options and
shall expire, unless previously exercised or cancelled, at such time as may be
set forth in a Stock Appreciation Right Agreement.

            (e)        Effect of Exercise - A Stock Appreciation Right shall be
canceled when, and to the extent that, it or a related Option is exercised, and
an Option shall be canceled when, and to the extent that, the Option is
surrendered to the Corporation upon the exercise of a related Stock Appreciation
Right.

Section 9.         RESTRICTED SHARES

            (a)        General - The Committee, in its sole discretion, may from
time to time authorize the grant of Restricted Shares to a Participant pursuant
to a Restricted Share Agreement. A certificate or certificates representing the
number of Restricted Shares granted shall be registered in the name of the
Participant or held in uncertificated form through a direct registration system
or the number of Restricted Shares shall be delivered by electronic delivery to
a brokerage account established for the Participant's benefit at a
financial/brokerage firm selected by the Corporation. Until the expiration of
the Restriction Period or the lapse of restrictions in the manner provided in
paragraph (d) or paragraph (e) of this Section 9, any certificate or
certificates shall be held by the Corporation for the account of the
Participant, and any Restricted Shares held through direct registration or in a
brokerage account shall be blocked from sale or transfer.  Until the expiration
of the Restriction Period or the lapse of restrictions in the manner provided in
paragraph (d) or paragraph (e) of this Section 9, the Participant shall have
beneficial ownership of the Restricted Shares, including the right to receive
dividends on, and the right to vote, the Restricted Shares.  Any dividends
declared during the Restriction Period shall be paid in cash on the date
declared by the Board of Directors.

            (b)        Performance Goal Requirement - The Committee may
determine, in its sole discretion, that a Participant's entitlement to
Restricted Shares shall be subject to achievement of a specified Performance
Goal or Goals during the Restriction Period. If so, the Committee shall select
the Performance Criterion or each combination thereof, the Performance Goal for
each Performance Criterion or each combination thereof, and the Performance
Criteria Weighting Percentage for each Performance Criterion or each combination
thereof within ninety (90) days of the commencement of the Restriction Period.
The Committee may also determine that the Restriction Period shall expire upon
achievement of established Performance Goals prior to the established end of the
Restriction Period. At such time as the Committee certifies that the Performance
Goals have been achieved, the Committee shall authorize delivery of Restricted
Shares (or such percentage of the Restricted Shares as equal the Percentage of
Performance Goals that have been achieved) for which the Restriction Period has
expired. If the Restricted Shares are subject to the achievement of Performance
Goals, such Restricted Shares shall be forfeited to the extent Performance Goals
are not achieved before the established end of the Restriction Period.

                        For Restricted Share subject to the achievement of
Performance Goals, the Committee may review the individual performance of any of
the Corporation's Executive Officers and may, at its discretion, reduce the
number of Restricted Shares deliverable to any such Executive Officer by between
0% and 100%, based on the individual's performance. For Restricted Share not
subject to the achievement of Performance Goals, the Committee may review the
individual performance of any of the Corporation's Executive Officers and may,
at its discretion, adjust the number of Restricted Shares deliverable to any
such Executive Officer by between 0% and 125%, based on the individual's
performance. The Corporation's chief executive officer may review the individual
performance of any Participant other than an Executive Officer and may, at his
discretion, adjust the number of Restricted Shares deliverable to any such
Participant by between 0% and 125%, based on the individual's performance.

            (c)        Restrictions - Until the expiration of the Restriction
Period or the lapse of restrictions in the manner provided in paragraph (d) or
paragraph (e) of this Section 9, Restricted Shares shall be subject to the
following restrictions and any additional restrictions that the Committee, in
its sole discretion, may from time to time deem desirable in furtherance of the
objectives of the Plan:

                        (i) the Participant shall not be entitled to receive the
certificate or certificates representing the Restricted Shares, or exercise any
ownership over any Restricted Shares held through direct registration or in a
brokerage account;

                        (ii) the Restricted Shares may not be sold, transferred,
assigned, pledged, conveyed, hypothecated, or otherwise disposed of; and

                        (iii) the Restricted Shares may be forfeited as provided
in paragraphs (b) or (e) of this Section 9, subject to the provisions of
paragraph (f) of this Section 9.

            (d)        Distribution of Restricted Shares - If a Participant to
whom Restricted Shares have been granted remains in the continuous employment of
the Corporation or a Subsidiary Company during the entire Restriction Period,
upon the expiration of the Restriction Period all restrictions applicable to the
Restricted Shares shall lapse.  When the restrictions applicable to the
Restricted Shares lapse, either:

                        (i) the certificate or certificates representing the
shares of Common Stock that were earned pursuant to paragraph (b) of this
Section 9 shall be delivered to the Participant or,

                        (ii) if the shares were delivered by electronic delivery
to a brokerage account established for the Participant's benefit or by direct
registration and held in uncertificated form, the restrictions on the sale or
transfer of or transfer any shares that were earned pursuant to paragraph (b) of
this Section 9 shall lapse.

            (e)        Termination of Employment - If the employment of a
Participant is terminated for any reason other than the Retirement, Disability,
or death of the Participant in service before the expiration of the Restriction
Period, the Restricted Shares shall be forfeited immediately and all rights of
the Participant with respect to such shares shall terminate immediately without
further obligation on the part of the Corporation or any Subsidiary Company. If
the Participant is granted a leave of absence before the expiration of the
Restriction Period, the Participant shall not forfeit any rights with respect to
any Restricted Shares subject to the Restriction Period, unless the
Participant's employment with the Corporation or a Subsidiary Company terminates
at any time during or at the end of the leave of absence, at which time the
shares shall be forfeited immediately and all rights of the Participant with
respect to such shares shall terminate immediately without further obligation on
the part of the Corporation or any Subsidiary Company. If the Participant's
employment is terminated by reason of the Retirement, Disability, or death of
the Participant in service before the expiration of the Restriction Period and
no Performance Goals have been imposed, the restrictions on the Restricted
Shares shall lapse upon the expiration of the Restriction Period and delivery of
the Restricted Shares shall be made to the Participant, or the Participant's
Beneficiary in the event of the Participant's death, at the end of the
Restriction Period or, if the shares were delivered by electronic delivery to a
brokerage account established for the Participant's benefit or by direct
registration and held in uncertificated form, the restrictions on the sale or
transfer of such shares shall lapse upon the expiration of the Restriction
Period.  If the Participant's employment is terminated by reason of the
Retirement, Disability, or death of the Participant in service before the
expiration of the Restriction Period and Performance Goals have been imposed,
the restrictions on the Restricted Shares shall lapse upon the expiration of the
Restriction Period and to the extent that the Committee certifies that
Performance Goals have been achieved and delivery of the Restricted Shares shall
be made to the Participant, or the Participant's Beneficiary in the event of the
Participant's death, in accordance with paragraph (b) of this Section 9, as
applicable or, if the shares were delivered by electronic delivery to a
brokerage account established for the Participant's benefit or by direct
registration and held in uncertificated form, the restrictions on the sale or
transfer of such shares shall lapse upon the expiration of the Restriction
Period to the extent that the Committee certifies that Performance Goals have
been achieved.

            (f)        Waiver of Restrictions - The Committee, in its sole
discretion, may waive any or all restrictions with respect to Restricted Shares.
Notwithstanding any waiver, any delivery of Restricted Shares may not be made
earlier than delivery would have been made absent such waiver of restrictions.

Section 10.      RESTRICTED STOCK UNITS

            (a)        General - The Committee, in its sole discretion, may from
time to time authorize the grant of Restricted Stock Units ("Units") to a
Participant pursuant to Restricted Stock Unit Agreement. Such Units shall be
recorded in individual memorandum accounts maintained by the Committee or its
agent.  The grant of Restricted Stock Units shall entitle the Participant to
payment in Restricted Stock Unit Shares or cash, as provided for in the
Restricted Stock Unit Agreement. The Participant shall have no beneficial
ownership interest in the Common Stock represented by the Units prior to
expiration of the Restriction Period and achievement of any Performance Goals.
The Participant shall have no right to vote the Common Stock represented by the
Units or to receive dividends (except for any dividend equivalent payments which
may be awarded by the Committee in connection with such Units) on the Common
Stock represented by the Units. The grant of Units shall be evidenced by a
Restricted Stock Unit Agreement between the Corporation or Subsidiary Company
and the Participant, identifying the number of Units awarded, and setting forth
the terms and conditions applicable to the Units.

            (b)        Performance Goal Requirement - The Committee may
determine, in its sole discretion, that a Participant's entitlement to payment
in cash or Restricted Stock Unit Shares for Restricted Stock Units shall be
subject to achievement of a specified Performance Goal or Goals over the
duration of the Restriction Period. If so, the Award shall specify when it is
granted that the Participant's entitlement to payment is subject to the
achievement of the Performance Goal or Goals, and the Committee shall select the
Performance Criterion or each combination thereof, the Performance Goals for
each Performance Criterion or each combination thereof, and the Performance
Criteria Weighting Percentage for each Performance Criterion or each combination
thereof within ninety (90) days after the commencement of the Restriction
Period.

            The Committee may specify, when the Award is granted, that the
Restriction Period shall expire upon achievement of the established Performance
Goals prior to the established end of the Restriction Period. At that time, the
Committee shall certify in writing to what extent the Performance Goals have
been achieved, and shall authorize settlement of Units in cash or Restricted
Stock Unit Shares.  The Units shall be settled within two and one half months
after the end of the year in which the Performance Goals are achieved.  Such
settlement shall be based on the Fair Market Value on the date all applicable
restrictions lapse (or such percentage of the value of the Restricted Stock
Units as equal the percentage of Performance Goals that have been achieved) for
which the Restriction Period has expired.  If the settlement of Restricted Stock
Units is subject to the achievement of Performance Goals, such Restricted Stock
Units shall be forfeited to the extent Performance Goals are not achieved before
the established end of the Restriction Period.

            For Restricted Stock Units subject to the achievement of Performance
Goals, the Committee may review the individual performance of any of the
Corporation's Executive Officers and may, at its discretion, reduce the cash
settlement or number of Restricted Stock Unit Shares delivered for the
Restricted Stock Units granted to any such Executive Officer by between 0% and
100%, based on the individual's performance.  For Restricted Stock Units not
subject to the achievement of Performance Goals, the Committee may review the
individual performance of any of the Corporation's Executive Officers and may,
at its discretion, adjust the cash settlement or number of Restricted Stock Unit
Shares delivered for the Restricted Stock Units granted to any such Executive
Officer by between 0% and 125%, based on the individual's performance. The
Corporation's chief executive officer may review the individual performance of
any Participant other than an Executive Officer and may, at his discretion,
adjust the cash settlement or number of Restricted Stock Unit Shares delivered
for the Restricted Stock Units granted to any such Participant by between 0% and
125%, based on the individual's performance.

            (c)        Restrictions - Until the expiration of the Restriction
Period or the lapse of restrictions in the manner provided in paragraph (b),
(d), (f), or (g) of this Section 10, Units shall be subject to the following
restrictions and any additional restrictions that the Committee, in its sole
discretion, may from time to time deem desirable in furtherance of the
objectives of the Plan:

                        (i) the grant of Units to a Participant shall not
entitle a Participant to receive cash payment or Restricted Stock Unit Shares;

                        (ii) the Units may not be sold, transferred, assigned,
pledged, conveyed, hypothecated, or otherwise disposed of; and,

                        (iii) all or a portion of the Units may be forfeited
immediately as provided in paragraph (b) or (e) of this Section 10, subject to
the provisions of paragraph (f) of this Section 10.

            (d)        Distribution of Restricted Stock Units - If a Participant
to whom Units have been granted remains in the continuous employment of the
Corporation or a Subsidiary Company during the entire Restriction Period, upon
the expiration of the Restriction Period all restrictions applicable to the
Units shall lapse, and the Units shall be settled in cash or in Restricted Stock
Unit Shares, based on Fair Market Value on the date all applicable restrictions
lapse.  Settlement in cash in a single sum or issuance of Restricted Stock Unit
Shares shall be made within thirty (30) days following the expiration of the
Restriction Period.  The Participant may not, directly or indirectly, designate
the taxable year of the settlement.

            (e)        Termination of Employment - If the employment of a
Participant is terminated for any reason other than the Retirement, Disability,
or death of the Participant in service before the expiration of the Restriction
Period, the Units shall be forfeited immediately and all rights of the
Participant with respect to such Units shall terminate immediately without
further obligation on the part of the Corporation or any Subsidiary Company. If
the Participant is granted a leave of absence before the expiration of the
Restriction Period, the Participant shall not forfeit all rights with respect to
any Units subject to the Restriction Period, unless the Participant's employment
with the Corporation or a Subsidiary Company terminates at any time during or at
the end of the leave of absence, at which time all rights of the Participant
with respect to such units shall terminate immediately without further
obligation on the part of the Corporation or any Subsidiary Company.

            (f)        Retirement, Disability or Death - If the Participant's
employment is terminated by reason of the Retirement, Disability, or death of
the Participant in service before the expiration of the Restriction Period and
no Performance Goals have been imposed, the restrictions on the Restricted Stock
Units shall lapse upon the expiration of the Restriction Period and settlement
of Restricted Stock Units shall be made at the end of the Restriction Period to
the Participant, or his Beneficiary in the event of the Participant's death. 
Settlement of the Restricted Stock Units shall be made within thirty (30) days
following the expiration of the Restriction Period. The Participant or
Beneficiary may not, directly or indirectly, designate the taxable year of the
settlement.

                        If the Participant's employment is terminated by reason
of the Retirement, Disability, or death of the Participant in service before the
expiration of the Restriction Period and Performance Goals have been imposed,
the restrictions on the Restricted Stock Units shall lapse if the Committee
certifies that Performance Goals have been achieved, and settlement of the
Restricted Stock Units shall be made to the Participant, or the Participant's
Beneficiary in the event of the Participant's death, in accordance with
paragraph (b) or (g) of this Section 10, as applicable.

            (g)        Waiver of Restrictions - The Committee, in its sole
discretion, may waive any or all restrictions with respect to Units.  If no
Performance Goals have been imposed, settlement of the Units shall be made on
the same settlement date that would have applied absent the waiver of
restrictions.  If Performance Goals have been imposed, settlement of the Units
shall be made within two and one half months after the end of the year in which
all restrictions are either waived or satisfied.    

Section 11.      PERFORMANCE SHARES

            (a)        General - The Committee, in its sole discretion, may from
time to time authorize the grant of Performance Share Units to a Participant.
Performance Share Units shall entitle the Participant to Performance Shares (or
cash in lieu thereof) upon the achievement of Performance Goals. The Committee
shall select the Performance Criteria, set the Performance Goals and assign
Performance Criteria Weighting Percentages to each Performance Criterion or each
combination thereof within ninety (90) days of the commencement of the
Performance Cycle. After the end of the Performance Cycle, the Committee shall
certify in writing to what extent the Performance Goals have been achieved.  The
Committee shall thereafter authorize the payment of (i) cash in lieu of
Performance Shares (or such percentage of the value of the Performance Shares as
equal the percentage of Performance Goals that have been achieved), or (ii)
either (1) the issuance of Performance Shares registered in the name of the
Participant or (2) the electronic delivery of Performance Shares to a brokerage
account established for the Participant's benefit at a financial/brokerage firm
selected by the Corporation (in either case equal to such percentage of the
value of the Performance Shares as equal the percentage of Performance Goals
that have been achieved), subject to the provisions of any Share Retention
Agreement that may be required by the Committee under Section 12 of the Plan, or
(iii) both. Settlement in cash or issuance of Performance Shares shall be made
within two and one half months after the end of the year in which the
Performance Goals are achieved. 

            (b)        Individual Performance Reviews - In addition, the
Committee may review the individual performance of any of the Corporation's
Executive Officers and may, at its discretion, reduce the cash settlement or
number of Performance Shares deliverable to any such Executive Officer by
between 0% and 100%, based on the individual's performance. The Corporation's
chief executive officer may review the individual performance of any Participant
other than an Executive Officer and may, at his discretion, adjust the cash
settlement or number of Performance Shares deliverable to any such Participant
by between 0% and 125%, based on the individual's performance.

            (c)        Distribution or Forfeiture of Performance Shares - If the
Participant's employment with the Corporation or a Subsidiary Company is
terminated before the end of a Performance Cycle for any reason other than
Retirement, Disability, or death, the Participant shall forfeit all rights with
respect to any Performance Shares that were being earned during the Performance
Cycle. If the Participant is granted a leave of absence before the end of a
Performance Cycle, the Participant shall not forfeit all rights with respect to
any Performance Shares that were being earned during the Performance Cycle,
unless the Participant's employment with the Corporation or a Subsidiary Company
terminates at any time during or at the end of the leave of absence, at which
time the Participant shall forfeit all rights with respect to any Performance
Shares that were being earned during the Performance Cycle. If the Participant's
employment is terminated before the end of a Performance Cycle by reason of
Retirement, Disability, or death, the Participant's rights with respect to any
Performance Shares being earned during the Performance Cycle shall, subject to
the other provisions of this Section 11, continue as if the Participant's
employment had continued through the end of the Performance Cycle.

Section 12.      SHARE RETENTION AGREEMENTS

            (a)        General - The Committee, in its sole discretion, may
require as a condition of a grant, exercise, settlement or payment with respect
to any Award under the Plan that the Participant and the Corporation enter into
a Share Retention Agreement, which shall provide that, with respect to any
Exercise Gain Shares, Restricted Shares, Restricted Stock Unit Shares, or
Performance Shares, that (i) the certificate or certificates representing any
such Awards, when issued, shall be held by the Secretary of the Corporation for
the benefit of the Participant until such time as the retention period specified
by the Share Retention Agreement has expired or has been waived by the
Committee, whichever occurs first, or (ii) that any such Award, when delivered
by electronic delivery to a brokerage account established for the Participant's
benefit at a financial/brokerage firm selected by the Corporation or by direct
registration and held in uncertificated form, shall not be permitted to be
transferred or sold until such time as the retention period specified by the
Share Retention Agreement has expired or has been waived by the Committee,
whichever occurs first.  Any dividends payable on shares subject to a Share
Retention Agreement shall be paid to the Participant in cash on the date
declared by the Board of Directors.  Each Share Retention Agreement may include
some or all of the terms, conditions and restrictions set forth in paragraphs
(b) through (g) of this Section 12.

            (b)        Retention Period - Shares that are subject to the Share
Retention Agreement may not be sold, transferred, assigned, pledged, conveyed,
hypothecated or otherwise disposed of within such period of time, of not less
than twenty-four (24) months and not more than sixty (60) months following the
exercise date (in the case of Exercise Gain Shares) or the date of issuance (in
the case of Restricted Shares, Restricted Stock Unit Shares, or Performance
Shares), as shall be prescribed by the Committee.

            (c)        Tax Absorption Payment - The Corporation may, in the
Committee's sole discretion, make a cash payment at any time prior to or
simultaneously with settlement or payment of an Award, either directly to the
Participant or on the Participant's behalf, in an amount that the Committee
estimates to be equal (after taking into account any Federal and state taxes
that the Committee estimates to be applicable to such cash payment) to any
additional Federal and state income taxes that are imposed upon the Participant
as a result of the issuance of the Exercise Gain Shares, Restricted Shares,
Restricted Stock Unit Shares, or Performance Shares that are subject to the
Share Retention Agreement. In determining the amount, if any, to be paid
pursuant to this paragraph (c), the Committee may adopt such methods and
assumptions as it considers appropriate, and it shall not be required to examine
the individual tax liability of each Participant who has entered into a Share
Retention Agreement.

            (d)        Termination of Employment - If a Participant's employment
with the Corporation or a Subsidiary Company is terminated for any reason other
than Retirement, Disability, or death, shares subject to the Share Retention
Agreement shall continue to be held, following the Participant's termination of
employment, until the expiration of the retention period specified by the Share
Retention Agreement. If the Participant's employment is terminated by reason of
Retirement or Disability, shares then held subject to the Share Retention
Agreement shall continue to be held until the expiration of the applicable
retention period following termination of employment, but any such retention
period shall cease upon the earlier of the Participant's attainment of age 65 or
the expiration of two (2) years after the Participant's Retirement or
Disability, if either of those events occurs before the expiration of the
applicable retention period. If the Participant dies while shares are subject to
a retention period under the Share Retention Agreement, such retention period
shall expire immediately at the time of death.

            (e)        Leave of Absence - If a Participant is granted a leave of
absence, shares subject to the Share Retention Agreement shall continue to be
held during the leave of absence, until the expiration of the retention period
specified by the Share Retention Agreement.

            (f)        Change in Control - Upon a Change in Control, the
retention periods specified by all Share Retention Agreements shall immediately
expire.

                        A Change in Control shall occur if:

                        (i) any person, other than the Corporation or a
Subsidiary Company or any employee benefit plan sponsored by the Corporation or
a Subsidiary Company, shall become the beneficial owner of, or obtain voting
control over, 20% or more of the Corporation's outstanding Common Stock;

                        (ii) the stockholders of the Corporation shall approve
(A) any consolidation or merger of the Corporation in which the Corporation is
not the continuing or surviving corporation or pursuant to which shares of
Common Stock would be converted into cash, securities, or other property, other
than a merger of the Corporation in which holders of Common Stock immediately
prior to the merger have the same proportionate ownership of common stock of the
surviving corporation immediately after the merger as immediately before, or (B)
any sale, lease, exchange, or other transfer (in one transaction or a series of
related transactions) of all or substantially all the assets of the Corporation;
or

                        (iii) there shall have been a change in the composition
of the Board of Directors such that within any period of two (2) consecutive
years or less individuals who at the beginning of such period constituted such
Board, together with any new directors whose election, or nomination for
election by the Corporation's stockholders, was approved by a vote of at least
two-thirds of the directors then in office who were directors at the beginning
of such period, shall for any reason no longer constitute a majority of the
directors of the Corporation.

                        If the expiration of a Share Retention Agreement
pursuant to this paragraph (f) causes a Participant to be subject to an excise
tax under Section 4999 of the Code, or any successor provision thereto (the
"Excise Tax"), the Corporation shall make a cash payment, either directly to the
Participant or on the Participant's behalf, in an amount that the Committee
estimates to be equal (after taking into account any Federal and state taxes,
including interest and penalties, that the Committee estimates to be applicable
to the additional cash payment) to the additional Excise Tax imposed on the
Participant as a result of the expiration of the Share Retention Agreement. In
determining the amount to be paid pursuant to this subparagraph, the Committee
may adopt such methods and assumptions as it considers appropriate, and it shall
not be required to examine the individual tax liability of each Participant to
whom this subparagraph applies.

            (g)        Waiver of Requirements - The Committee, in its sole
discretion, may waive any or all retention periods or other restrictions in the
Share Retention Agreement.

            (h)        Distribution of Shares - The Secretary of the Corporation
shall promptly distribute the certificate or certificates representing the
shares subject to a Share Retention Agreement upon expiration of the retention
period or other termination or waiver of the restrictions under this Section 12.

Section 13.      DIVIDEND EQUIVALENT PAYMENTS

            The Committee may authorize the immediate payment of dividend
equivalents on some or all of the shares of Common Stock covered by Options in
an amount equal to, and commensurate with, dividends declared by the Board of
Directors and paid on Common Stock. The Committee may authorize the immediate or
deferred payment of dividend equivalents on some or all of the shares of Common
Stock covered by Performance Share Units and Restricted Stock Units. Dividend
equivalents payable on Option shares or on Performance Share Units under this
Section 13 may be paid in cash or in Common Stock at the discretion of the
Committee. Dividend equivalents payable on Restricted Stock Units under this
Section 13 may be paid in cash or converted to additional Restricted Stock
Units, at the discretion of the Committee. The Committee may authorize the
immediate payment of dividend equivalents under this Section 13 with respect to
any Option for all or some portion of its term by including a specific
provision, authorizing such immediate payment, in the Incentive Stock Option
Agreement required under Section 6(a) of the Plan or the Non-qualified Stock
Option Agreement required under Section 7 of the Plan when the Award is granted.
The Committee may authorize the immediate or deferred payment of dividend
equivalents under this Section 13 with respect to any Performance Share Unit for
all or some portion of its term as a term and condition of the Performance Share
Unit grant when the Award is granted. The Committee may authorize the immediate
or deferred payment of dividend equivalents under this Section 13 with respect
to any Restricted Stock Unit for all or some portion of its term as a term and
condition of the Restricted Stock Unit Agreement, by including a specific
provision, authorizing such payment, in the Restricted Stock Unit Agreement
required under Section 10 of the Plan when the Award is granted. Notwithstanding
the above, dividend equivalent payments shall not be made or accumulated during
a Participant's leave of absence. If the Committee authorizes the dividend
equivalents to be paid immediately, the dividend equivalents shall be paid in
cash on the date declared by the Board of Directors for the payment of dividends
on Common Stock.  If the Committee authorizes dividend equivalents on
Performance Share Units or Restricted Stock Units to be deferred, the deferred
dividend equivalents shall be paid or forfeited when the underlying Award is
paid or forfeited.

Section 14.      NON-COMPETE COVENANT

            The Committee, in its sole discretion, may require as a condition of
a grant of any Award under the Plan that the Participant execute a non-compete,
non-solicitation and confidentiality agreement, which agreement shall require
that such individual (i) not Engage in Competing Employment (as defined in this
Section 14 of the Plan) nor solicit any employee of the Corporation or a
Subsidiary Company to Engage in Competing Employment for a specified term
following termination of employment (including Retirement), (ii) not solicit
customers of the Corporation or a Subsidiary Company for a specified term
following termination of employment (including Retirement), and (iii) maintain
the Corporation's and each Subsidiary Company's confidential information in
strict confidence, in accordance with the provisions of the agreement. The
Committee, in its sole discretion, may further require as a condition of a
grant, exercise, settlement or payment with respect to any Award under the Plan
that the Award shall be subject to immediate forfeiture, and all rights of the
Participant to such Award shall terminate immediately without further obligation
on the part of the Corporation or any Subsidiary Company, if the Participant
Engages in Competing Employment for a specified period of time following
termination of employment. The terms of such a non-compete covenant shall be as
set forth in the agreement or grant providing the terms of an Award and are
incorporated herein by reference.  A non-compete covenant shall not apply to the
settlement or payment of any Option (although it may apply to the grant or
exercise of an Option).  Settlement or payment of any other Award that is
subject to a non-compete covenant shall occur upon the expiration of the
Restriction Period, Performance Period, Retention Period, or other date upon
which the Award would be settled and paid if the Participant had not terminated
employment. 

            For purposes of the provision, "Engages in Competing Employment"
shall mean to work for or provide services for any Competitor, on the
Participant's own behalf or in the service of or on behalf of others, including,
but not limited to, as a consultant, independent contractor, owner, officer,
partner, joint venturer, or employee, at any time during the specified period
commencing on the date of his or her termination of employment (including
Retirement). "Competitor" shall mean any entity in the same line of business as
the Corporation in North American markets in which the Corporation competes,
including, but not limited to, any North American Class I rail carrier, any
other rail carrier competing with the Corporation (including without limitation
a holding or other company that controls or operates or is otherwise affiliated
with any rail carrier competing with the Corporation), and any other provider of
transportation services competing with Corporation, including motor and water
carriers.

Section 15.      CAPITAL ADJUSTMENTS

            In the event of a recapitalization, stock split, stock dividend,
exchange, combination, or reclassification of shares, merger, consolidation,
reorganization, or other change in or affecting the capital structure or capital
stock of the Corporation, the Board of Directors, upon the recommendation of the
Committee, may make appropriate adjustments in the number of shares of Common
Stock authorized for the Plan and in the annual limitation imposed by Section 5
of this Plan; and the Committee may make appropriate adjustments in the number
of shares subject to outstanding Options, Stock Appreciation Rights, Restricted
Shares, Restricted Stock Units, or Performance Share Unit grants, and in the
Option price of any then outstanding Options, as it deems equitable, in its
absolute discretion, to prevent dilution or enlargement of the rights of
Participants. To the extent required to prevent the treatment of any Award as
deferred compensation under Code Section 409A, the Committee will follow the
requirements of Code Section 409A and related Treasury Regulations.

Section 16.      REGULATORY APPROVALS

            The exercise of each Option and Stock Appreciation Right, and the
grant or distribution of Restricted Shares, Restricted Stock Units and
Performance Shares, shall be subject to the condition that if at any time the
Corporation shall determine in its discretion that the satisfaction of
withholding tax or other tax liabilities, or the listing, registration, or
qualification of any shares of Common Stock upon any securities exchange or
under any Federal or state law, or the consent or approval of any regulatory
body, is necessary or desirable as a condition of, or in connection with, such
exercise, grant, or distribution, then in any such event such exercise, grant,
or distribution shall not be effective unless such liabilities have been
satisfied or such listing, registration, qualification, consent, or approval
shall have been effected or obtained free of any conditions not acceptable to
the Corporation. 

Section 17.      TERM OF THE PLAN

            Awards may be granted from time to time under the terms and
conditions of the Plan, but no Incentive Stock Option may be granted after the
expiration of ten (10) years from the date of adoption of the Plan, as amended
on May 12, 2005, by the Board of Directors; provided, that any future amendment
to the Plan that is approved by the stockholders of the Corporation in the
manner provided under Section 18 of this Plan shall be regarded as creating a
new Plan, and an Incentive Stock Option may be granted under such new Plan until
the expiration of ten (10) years from the earlier of the approval by the Board
of Directors, or the approval by the stockholders of the Corporation, of such
new Plan. Incentive Stock Options theretofore granted may extend beyond the
expiration of that ten-year period, and the terms and conditions of the Plan
shall continue to apply thereto and to shares of Common Stock acquired upon the
subsequent exercise of an Incentive Stock Option or related Stock Appreciation
Right.

Section 18.      AMENDMENT OR TERMINATION OF THE PLAN

            The Corporation may at any time and from time to time alter or
amend, in whole or in part, any or all of the provisions of the Plan, or may at
any time suspend or terminate the Plan, through resolution of its Board of
Directors, provided that no change in any Awards theretofore granted to any
Participant may be made which would impair or diminish the rights of the
Participant without the Participant's consent, and provided further, that no
alteration or amendment may be made without the approval of the holders of a
majority of the Common Stock then outstanding and entitled to vote if such
stockholder approval is necessary to comply with the requirements of any rules
promulgated under Section 16 of the Securities Exchange Act of 1934 or such
other Federal or state laws or regulations as may be applicable. Notwithstanding
this provision, the amendment or termination of the Plan may not accelerate or
defer the payment of Awards in a manner that would violate the requirements of
Code Section 409A.

Section 19.      MISCELLANEOUS

            (a)        Fractional Shares - The Corporation shall not be required
to issue or deliver any fractional share of Common Stock upon the exercise of an
Option or Stock Appreciation Right, the award of Performance Shares, the payment
of a dividend equivalent in Common Stock pursuant to Section 13 of the Plan or
the withholding of shares of Common Stock for payment of taxes required to be
withheld, but may pay, in lieu thereof, an amount in cash equal to the Fair
Market Value of such fractional share.

            (b)        Withholding - The Corporation and its Subsidiary
Companies shall have the right, to the extent permitted by law, to deduct from
any payment of any kind otherwise due to a Participant any Federal, state or
local taxes of any kind required by law to be withheld with respect to Awards
under the Plan, and to the extent any such withholding requirements are not
satisfied, each Participant shall pay to the Corporation any Federal, state or
local taxes of any kind required by law to be withheld with respect to Awards
under the Plan. The Corporation shall have the right to withhold shares of
Common Stock, including fractional shares, from payment as necessary to satisfy
any withholding obligations, but may only withhold the minimum number of shares
necessary to do so. If fractional shares are withheld, any remaining fractional
shares shall be paid in cash to the Participant as provided under paragraph (a)
of this Section 19.  The Participant or Beneficiary shall remain responsible at
all times for paying any Federal, state or local taxes of any kind with respect
to Awards under the Plan.  In no event shall the Corporation or the Committee be
liable for any interest or penalty that a Participant or Beneficiary incurs by
failing to make timely payments of tax.

            (c)        Stockholder Rights - No person shall have any rights of a
stockholder by virtue of an Option, Stock Appreciation Right, or Performance
Share Unit except with respect to shares of Common Stock actually issued to him,
and the issuance of shares of Common Stock shall confer no retroactive right to
dividends.

            (d)        No Contract of Employment - This Plan shall not be deemed
to be an employment contract between the Corporation or any Subsidiary Company
and any Participant or other employee. Nothing contained herein, or in any
agreement, certificate or other document evidencing, providing for, or setting
forth the terms and conditions applicable to any Awards shall be deemed to
confer upon any Participant or other employee a right to continue in the
employment of the Corporation or any Subsidiary Company, or to interfere with
the right of the Corporation or any Subsidiary Company to terminate the
employment of such Participant or employee at any time.

            (e)        Unfunded Plan - Except as may otherwise be provided in
the Plan, the Plan shall be unfunded. Neither the Corporation nor any Subsidiary
Company shall be required to segregate any assets that may be represented by
Options, Stock Appreciation Rights, Performance Share Units, or Restricted Stock
Units, and neither the Corporation nor any Subsidiary Company shall be deemed to
be a trustee of any amounts to be paid under an Option, Stock Appreciation
Right, Performance Share Unit, or Restricted Stock Unit. Any liability of the
Corporation to pay any Participant or Beneficiary with respect to an Option,
Stock Appreciation Right, Performance Share Unit, or Restricted Stock Unit shall
be based solely upon any contractual obligations created pursuant to the
provisions of the Plan; no such obligation shall be deemed to be secured by any
pledge or encumbrance on any property of the Corporation or a Subsidiary
Company.

            (f)        Applicable Law - The Plan, its validity, interpretation,
and administration, and the rights and obligations of all persons having an
interest therein, shall be governed by and construed in accordance with the laws
of the Commonwealth of Virginia, except to the extent that such laws may be
preempted by Federal law.

            (g)        Gender and Number - Wherever used in the Plan, words in
the masculine form shall be deemed to refer to females as well as to males, and
words in the singular or plural shall be deemed to refer also to the plural or
singular, respectively, as the context may require.

            (h)        Code Section 409A - The Plan is intended, and shall be
construed, to comply with the requirements of Code Section 409A.  The
Corporation does not warrant that the Plan will comply with Code Section 409A
with respect to any Participant or with respect to any payment, however.  In no
event shall the Corporation or the Committee be liable for any additional tax,
interest, or penalty incurred by a Participant or Beneficiary as a result of the
Plan's failure to satisfy the requirements of Code Section 409A, or as a result
of the Plan's failure to satisfy any other applicable requirements for the
deferral of tax.