Exhibit 10.3

 

RETIREMENT BENEFIT AGREEMENT

 

THIS AGREEMENT dated this 22nd day of May, 2003, between Burlington Northern
Santa Fe Corporation (hereinafter referred to as the “Company”) and Mr. Charles
L. Schultz (hereinafter referred to as “Mr. Schultz”).

 

W I T N E S S E T H

 

WHEREAS, in consideration of Mr. Schultz’s service, the Company desires to
provide Mr. Schultz with benefits upon retirement to be calculated in the manner
and provided under the conditions set forth herein;

 

NOW, THEREFORE, in consideration of the mutual covenants contained herein, the
Company and Mr. Schultz agree as follows:

 

1. Upon retiring pursuant to the provisions of the Burlington Northern Santa Fe
Retirement Plan (hereinafter referred to as the “Plan”), Mr. Schultz will be
entitled to the following retirement benefits:

 

  (a)   A Normal Retirement Benefit, or reduced Early Retirement Benefit,
calculated in accordance with Plan provisions in effect on the date of his
termination, and payable out of Plan assets in accordance with the Plan terms
and, if entitled thereto by the provisions of the Burlington Northern Santa Fe
Supplemental Retirement Plan (the “Supplemental Plan”), an additional benefit
payable out of the general assets of the Company; and

 

  (b)   An extra Retirement Benefit payable monthly out of the general assets of
the Company and calculated as follows:

 

  (i)   Mr. Schultz’s Normal Retirement Benefit or reduced Early Retirement
Benefit calculated as if Mr. Schultz terminated his employment effective as of
the close of business on June 30, 2003, and calculated as if Mr. Schultz is
entitled to the Window Benefit provisions of Supplement B to the Plan without
regard to the minimum retirement benefit provisions of subparagraph 5 of
Paragraph B-5 of Supplement B and without regard to the maximum retirement
benefit provisions of subparagraph 6 of Paragraph B-5 of Supplement B and
provided that, for purposes of this Section 1(b), Mr. Schultz’s Plan
Compensation shall be increased by $733.33 for the months of April, 2002,
through June, 2003, and further provided that such Normal Retirement Benefit or
reduced Early Retirement Benefit shall be increased by an amount such that the
single sum value of such amount, computed based on

 

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a 7% interest rate and the 1983 Group Annuity Mortality Table for males, is
$422,249.00; minus

 

  (ii)   Mr. Schultz’s Normal Retirement Benefit, or reduced Early Retirement
Benefit, as calculated in Section 1(a) of this Agreement.

 

  (c)   For purposes of the extra Retirement Benefit to be provided to Mr.
Schultz pursuant to Section 1(b), Mr. Schultz shall be eligible for early
retirement at any time he has both attained age 55 and completed at least 10
years of vesting service.

  (d)   The first payment to Mr. Schultz out of the general assets of the
Company shall include an additional amounts equal to six times the monthly
amount determined under Section 1(b)(i), without regard to the offset described
in Section 1(b)(ii). This payment shall be made on or about January 4, 2004.

 

2. Nothing contained herein shall confer any right upon Mr. Schultz for
continued employment by the Company, or any affiliate or subsidiary of the
Company.

 

3. The continued payment of the extra Retirement Benefit to be provided to Mr.
Schultz pursuant to Section 1(b) shall be subject to the terms and conditions of
the Termination Agreement dated as of May 22, 2003, between the Company and Mr.
Schultz, including any reductions in such extra Retirement Benefit provided for
therein.

 

4. The Company retains the right to withhold from payments due hereunder amounts
deemed by the Company to be required to be withheld under income or other tax
laws of any jurisdiction.

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first above written.

 

 

BURLINGTON NORTHERN SANTA FE CORPORATION

By:

 

/s/    Matthew K. Rose

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[Corporate Seal]

 

ATTEST:

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    Secretary

 

CHARLES L. SCHULTZ

/s/    Charles L. Schultz

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