Document:

Restricted Stock Award Agreement

 

Exhibit 10.41

RESTRICTED STOCK AWARD AGREEMENT

     THIS AGREEMENT is made and entered into as of December 22, 2005, by and between CSX
CORPORATION (“CSX”), a Virginia corporation, and Ellen M. Fitzsimmons (the “Recipient”).

     WHEREAS, CSX wishes to create a further incentive for Recipient to remain as an employee of
CSX.

     NOW, THEREFORE, in consideration of their mutual promises and undertakings, CSX and Recipient
mutually agree as follows:

1.   In consideration for Recipient’s agreement to remain an active employee of CSX or an Affiliate,
continuously and without interruption from the period December 22, 2005 through December 21, 2008
(the “Employment Period”), the Recipient shall, as of December 22, 2005, receive a grant of 20,620
shares of restricted CSX Corporation common stock, $1 par value (the “Restricted Stock”) under
CSX’s Omnibus Incentive Plan (the “Plan”), the provisions of which are hereby incorporated by
reference. (In the event of any conflict between this Agreement and the Plan, this Agreement shall
control.) During the Employment Period, CSX will pay to Recipient an amount equal to dividends
declared and payable on the Restricted Stock from December 22, 2005, through the Employment Period,
net of applicable withholding taxes. Except as otherwise provided herein, the Restricted Stock
shall vest and the restrictions will be lifted as follows:

	 	 	 	 	 
	Vesting	 	Shares	 
	Date	 	Vested	 
	December 22, 2005
	 	 	5,155	 
	December 22, 2006
	 	 	5,155	 
	December 22, 2007
	 	 	5,155	 
	December 22, 2008
	 	 	5,155	 

2.   (a) Except as set forth in subsection 2, if Recipient’s employment by CSX or an Affiliate
terminates before the “Vesting Date,” this Agreement shall become null and void and CSX shall have
no obligation as to vesting of any of the Restricted Stock and payment of any further monies
pursuant to Paragraph 1 of this Agreement.

     (b) In the event of a termination of Recipient’s employment before the end of the Employment
Period by reason of Recipient’s death or Disability, by CSX without Cause or by Recipient for Good
Reason, the Date of Termination shall be the Vesting Date with respect to a number of shares of
Restricted Stock determined by the following formula:

(number of completed months from the Grant Date through the Date of

Termination / 48) x
20,620)

     For purposes of this Agreement, “Disability” shall mean the Recipient’s becoming disabled
within the meaning of the long-term disability plan of the Company covering the Recipient. “Cause”
means (i) the willful and continued failure of the Recipient substantially to perform the
Recipient’s duties under this Agreement (other

 

 

than as a result of physical or mental illness or injury), after the Board of Directors of the
Company (the “Board”) or the Chief Executive Officer or other senior executive of the Company delivers to the Recipient a written
demand for substantial performance that specifically identifies the
manner in which the Board, the Chief
Executive Officer or such other executive believes that the Recipient has not substantially
performed the Recipient’s duties, or (ii) illegal conduct or gross misconduct by the Recipient.
“Good Reason” means termination by the Recipient within 60 days after, and as a result of:

	 	i.	 	Any action by the Company that results in a material
diminution in the Recipient’s position, authority, duties or responsibilities;
provided, however, that minor changes in Recipient’s job title or
responsibilities will not constitute grounds for a Good Reason termination
under this Section 4(c)(i)(A).
	 
	 	ii.	 	any requirement by the Company that the Recipient’s services
be rendered primarily at a location or locations other than Jacksonville,
Florida, unless such requested relocation is made under the terms of the CSX
executive relocation policy.

     The remainder of the Restricted Stock shall be forfeited as of the Date of Termination and CSX
shall have no obligation as to vesting of such forfeited Restricted Stock, nor any obligation to
pay further monies pursuant to Paragraph 1 of this Agreement with respect to any of the Restricted
Stock.

     (c) Recipient shall be solely responsible for any and all federal, state, and local taxes
which may be imposed on her as a result of her receipt of the Restricted Stock, the vesting thereof
and her receipt of dividends pursuant to Section 1.

3.   In the event of any change (such as recapitalization, merger, consolidation, stock dividend, or
otherwise) in the character or amount of CSX Corporation common stock, $1 par value, prior to
vesting of the Restricted Stock pursuant to Paragraph 1 of this Agreement, (a) the number of shares
of Restricted Stock to which Recipient shall be entitled shall be the same as if she had actually
owned the Restricted Stock without restriction at the time of such change, and (b) the amount of
the cash to be paid to Recipient shall be the amount of dividends paid on the Restricted Stock
following such change in the number of shares of Restricted Stock.

4.   Upon the occurrence of the date of a Vesting Event as defined in the Plan, the Vesting Date will
be deemed to have occurred.

5.   Nothing in this Agreement shall be interpreted or construed to create a contract of employment
between the Company and the Recipient. This Agreement is intended sole to provide Recipient an
incentive to continue her existing employment.

 

 

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of December 22, 2005.

	 	 	 
	RECIPIENT:

	 	CSX CORPORATION
	 
	 	 
	/s/ Ellen M. Fitzsimmons

	 	/s/ Michael Ward
	 

	 	 
	Ellen M. Fitzsimmons

	 	Title: Chairman, President & CEOEx-10.1

 

Exhibit 10.1

Description of Annual Incentive and Long-Term Incentive Bonus Awards

          On February 17, 2006, the Compensation Committee of the Board of Directors (the “Compensation
Committee”) of CT Communications, Inc. (the “Company”) approved the terms pursuant to which the
Company would award annual incentive bonus awards for the 2006 fiscal year and the performance
criteria for the long-term incentive bonus awards for the 2006-2007 performance period. The
Company maintains an annual incentive discretionary bonus plan (the “annual incentive plan”) and
long-term incentive discretionary bonus plan (the “long-term incentive plan”) for the benefit of
its executive officers, other officers and certain other key employees of the Company. The annual
incentive plan and the long-term incentive plan are administered and paid out under the Company’s
shareholder-approved Amended and Restated 2001 Stock Incentive Plan.

          For 2006, the annual incentive award will consist of a cash bonus that may be paid based on
goals established and approved by the Company’s Compensation Committee. Potential bonuses are
specified as a percentage of the employees’ annual base salary, ranging from 25% to 150% for the
Chief Executive Officer, 20% to 100% for Senior Vice Presidents of the Company and 15% to 70% for
all other executive officers of the Company. For 2006, the annual incentive award will be based on
a combination of financial and operational objectives. Such objectives and their relative
weighting in the overall performance score are as follows:

	 	 	 	 	 
	Objective	 	Weight
	Operating revenue
	 	 	15	%
	 
	 	 	 	 
	Operating earnings before interest, taxes,
depreciation and amortization
	 	 	20	%
	 
	 	 	 	 
	Operating free cash flow
	 	 	5	%
	 
	 	 	 	 
	Aggregate net customer growth in the
Company’s ILEC, Wireless and DSL businesses
	 	 	10	%
	 
	 	 	 	 
	Aggregate customer disconnects in the
Company’s ILEC, Wireless and DSL businesses
	 	 	10	%
	 
	 	 	 	 
	Achievement of milestones related to broadband
network and product deployment
	 	 	40	%

          The Company, as authorized by the Compensation Committee, may also pay a long-term incentive
award based on a multi-year performance period with performance goals established at the beginning
of the cycle. Potential bonuses are specified as a percentage of the employees’ annual base
salary, ranging from 80% to 400% for the Chief Executive Officer, 50%

 

 

to 200% for Senior Vice Presidents, 30% to 100% for all other Vice Presidents reporting directly to
the Chief Executive Officer and 15% to 70% for all other executive officers of the Company.

          Although prior to 2005 the performance period established by the Compensation Committee was a
three-year period, in 2005, the Compensation Committee determined not to grant a long-term
incentive award for the 2005 to 2007 performance period and instead determined that a performance
period consisting of two years is more appropriate and consistent with the Company’s compensation
objectives and the rapidly changing telecommunications industry. Accordingly, in connection with
the transition from a three-year performance period to a two-year performance period, the
Compensation Committee approved in February 2005 a long-term incentive award for the 2006 to 2007
performance period, subject to the determination of the key performance objectives for such period,
which were approved by the Compensation Committee on February 17, 2006.

          For the long-term incentive award granted in 2005 for the 2006 to 2007 performance period, the
long-term incentive award is based on the following combination of financial measurements and
weightings:

	 	 	 	 	 
	Objective	 	Weight
	Operating revenue
	 	 	20	%
	 
	 	 	 	 
	Operating earnings before interest, taxes,
depreciation and amortization
	 	 	20	%
	 
	 	 	 	 
	Cumulative operating free cash flow
	 	 	10	%
	 
	 	 	 	 
	Period-end customers of the Company’s ILEC,
Wireless and Broadband businesses
	 	 	20	%
	 
	 	 	 	 
	Total shareholder return (compared to a
peer stock index)
	 	 	30	%

          The long-term incentive awards for the 2006 to 2007 performance period will consist of 25%
unrestricted common stock and 75% restricted common stock. The restricted common stock will vest
according to the following schedule: 33% will vest one year from the award date and 67% will vest
two years from the award date. The price that is used to calculate the number of restricted and
unrestricted shares that are awarded will be the average closing NASDAQ price for all trading days
in the month of December at the end of the applicable performance period.

               In addition to the annual and long-term incentive compensation, compensation for executive
officers may include additional awards of nonqualified and/or incentive stock options issued under
the Company’s Amended and Restated 2001 Stock Incentive Plan.

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