Document:

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                                                                   Exhibit 10.26

                                       CSX
                             OMNIBUS INCENTIVE PLAN

               As Amended and Restated Effective February 14, 2001

1.   Purpose. The purpose of this CSX Omnibus Incentive Plan (the "Plan") is to
     further the long term stability and financial success of CSX, its
     Subsidiaries, Foreign Affiliates and Affiliates by rewarding selected
     meritorious employees. The Board of Directors believes that such awards
     will provide incentives for employees to remain with CSX, will encourage
     continued work of superior quality and will further the identification of
     those employees' interests with those of CSX's shareholders.

2.   Definitions. As used in the Plan, the following terms have the meanings
     indicated:

     (a)  "Affiliate" means a corporation, partnership or other entity other
          than a Subsidiary or Foreign Affiliate in which CSX or a Subsidiary
          owns, directly or indirectly, a substantial interest. The employees of
          an Affiliate shall be eligible to participate in the Plan only if the
          Board or the Committee approves the participation of the Affiliate in
          the Plan.

     (b)  "Applicable Withholding Taxes" means the aggregate minimum amount of
          federal, state, local and foreign income, payroll and other taxes that
          an Employer is required to withhold in connection with any Incentive
          Award.

     (c)  "Beneficiary" means the person or entity designated by the
          Participant, in a form approved by CSX, to exercise the Participant's
          rights with respect to an Incentive Award after the Participant's
          death.

     (d)  "Benefits Trust Committee" means the committee established pursuant to
          the CSX Corporation and Affiliated Companies Benefits Assurance Trust.

     (e)  "Board" means the Board of Directors of CSX Corporation.

     (f)  "Cause" means: (i) an act or acts of personal dishonesty of a
          Participant intended to result in substantial personal enrichment of
          the Participant at the expense of the Company or any of its
          Subsidiaries, Foreign Affiliates or Affiliates; (ii) a violation of
          the management responsibilities by the Participant which is
          demonstrably willful and deliberate on the Participant's part and
          which is not remedied in a reasonable period of time after receipt of
          written notice from the Employer; or, (iii) the conviction of the
          Participant of a felony involving moral turpitude.

     (g)  "Change in Control" means the occurrence of any of the following
          events:

          (i)  Stock Acquisition. The acquisition by any individual, entity or
               group [within the meaning of Section 13(d)(3) or 14(d)(2) of the
               Securities Exchange Act of 1934, as amended (the "Exchange Act")]
               (a "Person") of beneficial ownership (within the meaning of Rule
               13d-3 promulgated under the Exchange Act) of 20 percent or

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               more of either (A) the then outstanding shares of common stock of
               CSX (the "Outstanding Company Common Stock"), or (B) the combined
               voting power of the then outstanding voting securities of CSX
               entitled to vote generally in the election of directors (the
               "Outstanding Company Voting Securities"); provided, however, that
               for purposes of this subsection (i), the following acquisitions
               shall not constitute a change in control: (A) any acquisition
               directly from CSX; (B) any acquisition by CSX; (C) any
               acquisition by any employee benefit plan (or related trust)
               sponsored or maintained by CSX or any corporation controlled by
               CSX; or (D) any acquisition by any corporation pursuant to a
               transaction which complies with clauses (A), (B) and (C) of
               subsection (iii) of this Section 2(c); or

         (ii)  Board Composition. Individuals who, as of the date hereof,
               constitute the Board (the "Incumbent Board") cease for any reason
               to constitute at least a majority of the Board; provided,
               however, that any individual becoming a director subsequent to
               the date hereof whose election or nomination for election by
               CSX's shareholders was approved by a vote of at least a majority
               of the directors then comprising the Incumbent Board shall be
               considered as though such individual were a member of the
               Incumbent Board, but excluding, for this purpose, any such
               individuals whose initial assumption of office occurs as a result
               of an actual or threatened election contest with respect to the
               election or removal of directors or other actual or threatened
               solicitation of proxies or consents by or on behalf of a Person
               other than the Board; or

         (iii) Business Combination. Approval by the shareholders of CSX of a
               reorganization, merger, consolidation, or sale or other
               disposition of all or substantially all of the assets of CSX or
               its principal Subsidiary that is not subject, as a matter of law
               or contract, to approval by the Surface Transportation Board or
               any successor agency or regulatory body having jurisdiction over
               such transactions (the "STB") (a "Business Combination"), in each
               case, unless, following such Business Combination:

               (A)  all or substantially all of the individuals and entities who
                    were the beneficial owners, respectively, of the Outstanding
                    Company Common Stock and Outstanding Company Voting
                    Securities immediately prior to such Business Combination
                    beneficially own, directly or indirectly, more than 50
                    percent of, respectively, the then outstanding shares of
                    common stock and the combined voting power of the then
                    outstanding voting securities entitled to vote generally in
                    the election of directors, as the case may be, of the
                    corporation resulting from such Business Combination
                    (including, without limitation, a corporation which as a
                    result of such transaction owns CSX or its principal
                    Subsidiary or all or substantially all of the assets of CSX
                    or its principal Subsidiary either directly or through one
                    or more subsidiaries) in substantially the same proportions
                    as their ownership immediately prior to such Business
                    Combination of the Outstanding Company Common Stock and
                    Outstanding Company Voting Securities, as the case may be;

               (B)  no Person (excluding any corporation resulting from such
                    Business Combination or any employee benefit plan (or
                    related trust) of CSX or such corporation resulting from
                    such Business Combination) beneficially owns, directly or
                    indirectly, 20 percent or more of, respectively, the then

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                    outstanding shares of common stock of the corporation
                    resulting from such Business Combination or the combined
                    voting power of the then outstanding voting securities of
                    such corporation except to the extent that such ownership
                    existed prior to the Business Combination; and

               (C)  at least a majority of the members of the board of directors
                    resulting from such Business Combination were members of the
                    Incumbent Board at the time of the execution of the initial
                    agreement, or of the action of the Board providing for such
                    Business Combination; or

          (iv) Regulated Business Combination. Approval by the shareholders of
               ------------------------------
               CSX of a Business Combination that is subject, as a matter of law
               or contract, to approval by the STB (a "Regulated Business
               Combination") unless such Business Combination complies with
               clauses (A), (B) and (C) of subsection (iii) of this Section
               2(g); or

          (v)  Liquidation or Dissolution. Approval by the shareholders of CSX
               --------------------------
               of a complete liquidation or dissolution of CSX or its principal
               Subsidiary.

     (h)  "Code" means the Internal Revenue Code of 1986, as amended.

     (i)  "Committee" means the Compensation Committee of the Board or its
          successor, provided that, if any member of the Compensation Committee
          does not qualify as both an outside director for purposes of Code
          Section 162(m) and a non-employee director for purposes of Rule 16b-3,
          the remaining members of the Compensation Committee (but not less than
          two members) shall be constituted as a subcommittee of the
          Compensation Committee to act as the Committee for purposes of the
          Plan.

     (j)  "Company Stock" means common stock, $1. 00 par value, of CSX. In the
          event of a change in the capital structure of CSX affecting the common
          stock (as provided in Section 18), the shares resulting from such a
          change in the common stock shall be deemed to be Company Stock within
          the meaning of the Plan.

     (k)  "Covered Employee" means a Participant who the Committee determines is
          or may become a covered employee within the meaning of Code Section
          162(m) during the performance period for a Performance Grant.

     (l)  "CSX" means CSX Corporation.

     (m)  "Date of Grant" means the date on which the Committee grants an
          Incentive Award.

     (n)  "Disability" or "Disabled" means, as to an Incentive Stock Option, a
          Disability within the meaning of Code Section 22(e)(3). As to all
          other Incentive Awards, a Disability shall occur when the Participant
          is eligible for benefits under the CSX Salary Continuance and
          Long-Term Disability Plan or another long-term disability plan of CSX
          applicable to the Participant.

     (o)  "Divisive Transaction" means a transaction in which the Participant's
          Employer ceases to be a Subsidiary, Foreign Affiliate or Affiliate or
          a sale of substantially all of the assets of a Subsidiary, Foreign
          Affiliate or Affiliate.

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     (p)  "Employer" means CSX and each Subsidiary, Foreign Affiliate or
          Affiliate that employs one or more Participants.

     (q)  "Fair Market Value" means the mean between the highest and lowest
          registered sales prices of a share of Company Stock on the New York
          Stock Exchange, as reported in the Wall Street Journal (or other
          authoritative source approved by the Committee) on the day of
          reference.

     (r)  "Foreign Affiliate" means an entity that is not organized under the
          laws of the United States, or any state thereof or any political
          subdivision of any state, and in which CSX has, directly or
          indirectly, a substantial interest.

     (s)  "Good Reason," as to any Participant, means (i) the Participant's
          compensation or employment related benefits are reduced (other than
          across-the-board reductions that affect management employees
          generally); (ii) the Participant's status, title(s), office(s),
          working conditions, or management responsibilities are diminished
          (other than changes in reporting or management responsibilities
          required by applicable federal or state law); or (iii) the location of
          Participant's place of employment is changed by more than 30 miles
          without the Participant's consent.

     (t)  "Incentive Award" means, collectively, a Performance Grant or the
          award of Restricted Stock, an Option, a Restricted Stock Unit, a Stock
          Appreciation Right, or a Dividend Right under the Plan.

     (u)  "Incentive Stock Option" means an Option that qualifies for favorable
          federal income tax treatment under Code Section 422.

     (v)  "Mature Shares" means shares of Company Stock for which the holder has
          good title, free and clear of all liens and encumbrances and which the
          holder either (i) has held for at least six months or (ii) has
          purchased on the open market.

     (w)  "Nonqualified Stock Option" means an Option that is not an Incentive
          Stock Option.

     (x)  "Option" means a right to purchase Company Stock granted under the
          Plan, at a price determined in accordance with the Plan.

     (y)  "Participant" means any employee of CSX, a Subsidiary, a Foreign
          Affiliate or an Affiliate who receives an Incentive Award under the
          Plan.

     (z)  "Performance Criteria" means any of the following areas of performance
          of CSX, any Subsidiary, any Foreign Affiliate, or any Affiliate:

          return on invested capital (ROIC); free cash flow; value added (ROIC
          less cost of capital multiplied by capital); total shareholder return;
          economic value added (net operating profit after tax less cost of
          capital); operating ratio; cost reduction (or limits on cost
          increases); debt to capitalization; debt to equity; earnings; earnings
          before interest and taxes; earnings before interest, taxes,
          depreciation and amortization; earnings per share (including or
          excluding nonrecurring items); earnings per share before extraordinary
          items; income from operations (including or excluding nonrecurring
          items); income from operations compared to capital spending; net
          income (including or excluding nonrecurring items, extraordinary items
          and/or the accumulative effect of accounting changes); net sales;
          price per share of

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          Company Stock; return on assets; return on capital employed; return on
          equity; return on investment; return on sales; and sales volume.

          Any Performance Criteria may be used to measure the performance of CSX
          as a whole or any Subsidiary, Foreign Affiliate, Affiliate or business
          unit of CSX. As determined by the Committee, Performance Criteria
          shall be derived from the financial statements of CSX, its
          Subsidiaries or affiliated entities prepared in accordance with
          generally accepted accounting principles applied on a consistent
          basis, or, for Performance Criteria that cannot be so derived, under a
          methodology established by the Committee prior to the issuance of a
          Performance Grant that is consistently applied.

     (aa) "Performance Goal" means an objectively determinable performance goal
          established by the Committee with respect to a given Performance Grant
          that relates to one or more Performance Criteria.

     (bb) "Performance Grant" means an Incentive Award payable in Company Stock,
          cash, or a combination of Company Stock and cash that is made pursuant
          to Section 8.

     (cc) "Restricted Stock" means Company Stock awarded under Section 6.

     (dd) "Restricted Stock Unit" means a right granted to a Participant to
          receive Company Stock or cash awarded under Section 7.

     (ee) "Retirement" means a Participant's termination of employment after age
          55 with eligibility to begin immediately receiving retirement benefits
          under an Employer's defined benefit pension plan.

     (ff) "Rule 16b-3" means Rule 16b-3 of the Securities and Exchange
          Commission promulgated under the Securities Exchange Act of 1934, as
          amended. A reference in the Plan to Rule 16b-3 shall include a
          reference to any corresponding rule (or number redesignation) of any
          amendments to Rule 16b-3 enacted after the effective date of the
          Plan's adoption.

     (gg) "Senior Executive Incentive Award" means an award made to a
          Participant under the terms of the Senior Executive Incentive Plan.

     (hh) "Senior Executive Incentive Plan" means the CSX Senior Executive
          Incentive Plan.

     (ii) "Stock Appreciation Right" means a right to receive amounts awarded
          under Section 10.

     (jj) "Subsidiary" means any corporation in which CSX owns stock possessing
          more than 50 percent of the combined voting power of all classes of
          stock or which is in a chain of corporations with CSX in which stock
          possessing more than 50 percent of the combined voting power of all
          classes of stock is owned by one or more other corporations in the
          chain.

     (kk) "Vesting Event" means the occurrence of any of the events listed in
          Section 2(g), with the following modification: The words, "Approval by
          the shareholders of CSX of," in the first line of Sections 2(g)(iii)
          and 2(g)(iv) are replaced for purposes of this Section 2(kk) with the
          words, "Consummation of, i.e., actual change in ownership of
                                   ----
          Outstanding Corporation Common Stock, Outstanding Corporation Voting
          Stock, and/or assets of CSX or its principal Subsidiary by reason of
          ,".

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3.   Stock.

     (a)  Subject to Section 18 of the Plan, there shall be reserved for
          issuance under the Plan an aggregate of 6 million (6,000,000) shares
          of Company Stock, which shall be authorized, but unissued shares, plus
          any shares of Company Stock that are represented by awards granted
          under any prior plan of the Company, which are forfeited, expire or
          are cancelled without the delivery of shares or which result in the
          forfeiture of shares back to CSX. Shares allocable to Incentive Awards
          granted under the Plan that expire, are forfeited, otherwise terminate
          unexercised, or are settled in cash may again be subjected to an
          Incentive Award under the Plan. For purposes of determining the number
          of shares that are available for Incentive Awards under the Plan, the
          number shall include the number of shares surrendered by a Participant
          actually or by attestation or retained by CSX in payment of Applicable
          Withholding Taxes and any Mature Shares surrendered by a Participant
          upon exercise of an Option or in payment of Applicable Withholding
          Taxes. Shares issued under the Plan through the settlement, assumption
          of substitution of outstanding awards or obligations to grant future
          awards as a condition of an Employer acquiring another entity shall
          not reduce the maximum number of shares available for delivery under
          the Plan. Shares issued under the Senior Executive Incentive Plan
          shall reduce the maximum number of shares available for delivery under
          the Plan.

     (b)  No more than 1,200,000 shares may be allocated to the Incentive
          Awards, including the maximum amounts payable under a Performance
          Grant, that are granted to any individual Participant during any
          36-month period. The maximum number of shares that may be issued as
          Restricted Stock, Restricted Stock Units, Dividend Equivalents and
          under Performance Grants, Stock Awards or Senior Executive Incentive
          Plan Grants shall be 1,200,000 shares, provided that any shares of
          Restricted Stock, Restricted Stock Units, Dividend Equivalents,
          Performance Grants or Stock Awards that are forfeited shall not count
          against this limit. The maximum cash payment that can be made for all
          Incentive Awards granted to any one individual shall be $3,000,000
          times the number of 12-month periods in any performance cycle for any
          single or combined performance goals. Any amount that is deferred by a
          Participant shall be subject to the previous limit on the maximum cash
          payment in the year in which the deferral is made and not in any later
          year in which payment is made.

4.   Eligibility.

     (a)  All present and future employees of CSX, a Subsidiary, or a Foreign
          Affiliate at the time of grant shall be eligible to receive Incentive
          Awards under the Plan. If an Affiliate is approved to participate in
          the Plan, all present and future employees of an Affiliate at the time
          of grant shall be eligible to receive Incentive Awards under the Plan.
          The Committee shall have the power and complete discretion, as
          provided in Section 19, to select eligible employees to receive
          Incentive Awards and to determine for each employee the nature of the
          award and the terms and conditions of each Incentive Award.

     (b)  The grant of an Incentive Award shall not obligate an Employer to pay
          an employee any particular amount of remuneration, to continue the
          employment of the employee after the grant or to make further grants
          to the employee at any time thereafter.

5.   Stock Options.

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     (a)  The Committee may make grants of Options to Participants. The
          Committee shall determine the number of shares for which Options are
          granted, the Option exercise price per share, whether the Options are
          Incentive Stock Options or Nonqualified Stock Options, and any other
          terms and conditions to which the Options are subject.

     (b)  The exercise price of shares of Company Stock covered by an Option
          shall be not less than 100 percent of the Fair Market Value of the
          Company Stock on the Date of Grant. Except as provided in Section 18,
          the exercise price of an Option may not be decreased after the Date of
          Grant. Except as provided in Section 18, a Participant may not
          surrender an Option in consideration for the grant of a new Option
          with a lower exercise price. If a Participant's Option is cancelled
          before its termination date, the Participant may not receive another
          Option within 6 months of the cancellation unless the exercise price
          of such Option is no less than the exercise price of the cancelled
          Option.

     (c)  An Option shall not be exercisable more than 10 years after the Date
          of Grant. The aggregate Fair Market Value, determined at the Date of
          Grant, of shares for which Incentive Stock Options become exercisable
          by a Participant during any calendar year shall not exceed $100,000.

6.   Restricted Stock Awards.

     (a)  The Committee may make grants of Restricted Stock to Participants. The
          Committee shall establish as to each award of Restricted Stock the
          terms and conditions to which the Restricted Stock is subject,
          including the period of time before which all restrictions shall lapse
          and the Participant shall have full ownership of the Company Stock
          (the "Restriction Period"). The Committee in its discretion may award
          Restricted Stock without cash consideration.

     (b)  Except as provided below in Section 6(c), the minimum Restriction
          Period applicable to any award of Restricted Stock that is not subject
          to performance standards restricting transfer shall be three years
          from the Date of Grant. Except as provided below in Section 6(c), the
          minimum Restriction Period applicable to any award of Restricted Stock
          that is subject to performance standards shall be one year from the
          Date of Grant.

     (c)  Restriction Periods of shorter duration than provided in Section 6(b)
          and Section 7(b) may be approved for awards of Restricted Stock or
          Restricted Stock Units combined with respect to up to 600,000 shares
          of Company Stock under the Plan.

     (d)  Restricted Stock may not be sold, assigned, transferred, pledged,
          hypothecated, or otherwise encumbered or disposed of until the
          restrictions have lapsed or been removed. Certificates representing
          Restricted Stock shall be held by CSX until the restrictions lapse and
          the Participant shall provide CSX with appropriate stock powers
          endorsed in blank.

7.   Restricted Stock Units.

     (a)  The Committee may make grants of Restricted Stock Units to
          Participants. The Committee shall establish as to each award of
          Restricted Stock Units the terms and conditions to which the
          Restricted Stock Units are subject. Upon lapse of the restrictions, a
          Restricted Stock Unit shall entitle the Participant to receive from
          CSX a share of Company Stock or a cash amount equal to the Fair Market
          Value of the Company Stock on the date that the restrictions lapse.

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     (b)  Except as provided in Section 6(c), the minimum Restriction Period
          applicable to any award of Restricted Stock Units that is not subject
          to performance standards restricting transfer shall be three years
          from the Date of Grant. Except as provided in Section 6(c), the
          minimum Restriction Period applicable to any award of Restricted Stock
          Units that is subject to performance standards shall be one year from
          the Date of Grant.

8.   Performance Grants.

     (a)  The Committee may make Performance Grants to any Participant. Each
          Performance Grant shall contain the Performance Goals for the award,
          including the Performance Criteria, the target and maximum amounts
          payable and such other terms and conditions of the Performance Grant.
          As to each Covered Employee, each Performance Grant shall be granted
          and administered to comply with the requirements of Code Section
          162(m).

     (b)  The Committee shall establish the Performance Goals for Performance
          Grants. The Committee shall determine the extent to which any
          Performance Criteria shall be used and weighted in determining
          Performance Grants. The Committee may increase, but not decrease, any
          Performance Goal during a performance period for a Covered Employee.
          The Performance Goals for any Performance Grant for a Covered Employee
          shall be made not later than 90 days after the start of the period for
          which the Performance Grant relates and shall be made prior to the
          completion of 25 percent of such period.

     (c)  The Committee shall establish for each Performance Grant the amount of
          Company Stock or cash payable at specified levels of performance,
          based on the Performance Goal for each Performance Criteria. The
          Committee shall make all determinations regarding the achievement of
          any Performance Goals. The Committee may not increase the amount of
          cash or Common Stock that would otherwise be payable upon achievement
          of the Performance Goal or Goals but may reduce or eliminate the
          payments except as provided in a Performance Grant.

     (d)  The actual payments to a Participant under a Performance Grant will be
          calculated by applying the achievement of Performance Criteria to the
          Performance Goal. The Committee shall make all calculations of actual
          payments and shall certify in writing the extent, if any, to which the
          Performance Goals have been met.

9.   Stock Awards. The Committee may make Stock Awards to any Participant. The
     Committee shall establish the number of shares of Common Stock to be
     awarded and the terms and conditions applicable to each Stock Award. The
     Committee will make all determinations regarding the achievement of any
     performance restrictions on a Stock Award. The Common Stock under a Stock
     Award shall be issued by CSX upon the satisfaction of the terms and
     conditions of a Stock Award. No more than 1,200,000 shares of Company Stock
     (reduced by shares issued under Restricted Stock or Restricted Stock Units
     subject to Section 6(c)) may be granted under Stock Awards without
     performance restrictions.

10.  Stock Appreciation Rights. The Committee may make grants of Stock
     Appreciation Rights to Participants. The Committee shall establish as to
     each award of Stock Appreciation Rights the terms and conditions to which
     the Stock Appreciation Rights are subject. The following provisions apply
     to all Stock Appreciation Rights:

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     (a)  A Stock Appreciation Right shall entitle the Participant, upon
          exercise of the Stock Appreciation Right, to receive in exchange an
          amount equal to the excess of (x) the Fair Market Value on the date of
          exercise of the Company Stock covered by the surrendered Stock
          Appreciation Right over (y) an amount not less than 100 percent of the
          Fair Market Value of the Company Stock on the Date of Grant of the
          Stock Appreciation Right. The Committee may limit the amount that the
          Participant will be entitled to receive upon exercise of Stock
          Appreciation Rights.

     (b)  A Stock Appreciation Right may not be exercisable more than 10 years
          after the Date of Grant. A Stock Appreciation Right may only be
          exercised at a time when the Fair Market Value of the Company Stock
          covered by the Stock Appreciation Right exceeds the Fair Market Value
          of the Company Stock on the Date of Grant of the Stock Appreciation
          Right. The Stock Appreciation Right may provide for payment in Company
          Stock or cash, or a fixed combination of Company Stock or cash, or the
          Committee may reserve the right to determine the manner of payment at
          the time the Stock Appreciation Right is exercised.

11.  Dividend Equivalents. The Committee may make grants of Dividend Equivalents
     to any Participant. The Committee shall establish the terms and conditions
     to which the Dividend Equivalents are subject. Dividend Equivalents may be
     granted in connection with any other Incentive Award or separately. Under a
     Dividend Equivalent, a Participant shall be entitled to receive currently
     or in the future payments equivalent to the amount of dividends paid by CSX
     to holders of Company Stock with respect to the number of Dividend
     Equivalents held by the Participant. The Dividend Equivalent may provide
     for payment in Company Stock or cash, or a fixed combination of Company
     Stock or cash, or the Committee may reserve the right to determine the
     manner of payment at the time the Dividend Equivalent is payable.

12.  Method of Exercise of Options. Options may be exercised by the Participant
     (or his guardian or personal representative) giving notice to the Corporate
     Secretary of CSX or his delegate pursuant to procedures established by CSX
     of the exercise stating the number of shares the Participant has elected to
     purchase under the Option. The exercise price may be paid in cash; or if
     the terms of an Option permit, (i) delivery or attestation of Mature Shares
     (valued at their Fair Market Value) in satisfaction of all or any part of
     the exercise price, (ii) delivery of a properly executed exercise notice
     with irrevocable instructions to a broker to deliver to CSX the amount
     necessary to pay the exercise price from the sale or proceeds of a loan
     from the broker with respect to the sale of Company Stock or a broker loan
     secured by Company Stock, or (iii) a combination of (i) and (ii).

13.  Tax Withholding. Whenever payment under an Incentive Award is made in cash,
     the Employer will withhold an amount sufficient to satisfy any Applicable
     Withholding Taxes. Each Participant shall agree as a condition of receiving
     an Incentive Award payable in the form of Company Stock, to pay to the
     Employer, or make arrangements satisfactory to the Employer regarding the
     payment to the Employer of, Applicable Withholding Taxes. To satisfy
     Applicable Withholding Taxes and under procedures established by the
     Committee or its delegate, a Participant may elect to (i) make a cash
     payment or authorize additional withholding from cash compensation, (ii)
     deliver Mature Shares (valued at their Fair Market Value) or (iii) have CSX
     retain that number of shares of Company Stock (valued at their Fair Market
     Value) that would satisfy all or a specified portion of the Applicable
     Withholding Taxes.

14.  Transferability of Incentive Awards. Incentive Awards other than Incentive
     Stock Options shall not be transferable by a Participant and exercisable by
     a person other than the Participant, except as expressly provided in the
     Incentive Award. Incentive Stock Options, by their terms, shall not be

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     transferable except by will or by the laws of descent and distribution and
     shall be exercisable, during the Participant's lifetime, only by the
     Participant.

15.  Deferral Elections. The Committee may permit Participants to elect to defer
     the issuance of Company Stock or the settlement of awards in cash under the
     Plan pursuant to such rules, procedures, or programs as it may establish.

16.  Effective Date of the Plan. The effective date of the Plan is April 27,
     2000. The Plan shall be submitted to the shareholders of CSX for approval.
     Until (i) the Plan has been approved by CSX's shareholders, and (ii) the
     requirements of any applicable federal or state securities laws have been
     met, no Restricted Stock shall be awarded that is not contingent on these
     events and no Option granted shall be exercisable.

17.  Termination, Modification, Change. If not sooner terminated by the Board,
     this Plan shall terminate at the close of business on April 26, 2010. No
     Incentive Awards shall be made under the Plan after its termination. Prior
     to a Change in Control, the Board may amend or terminate the Plan as it
     shall deem advisable; provided that no change shall be made that increases
     the total number of shares of Company Stock reserved for issuance pursuant
     to Incentive Awards granted under the Plan (except pursuant to Section 18),
     or reduces the minimum exercise price for Options unless such change is
     authorized by the shareholders of CSX. A termination or amendment of the
     Plan shall not, without the consent of the Participant, adversely affect a
     Participant's rights under an Incentive Award previously granted to him or
     her. After a Change in Control, all amendments to the Plan are subject to
     the approval of the Benefits Trust Committee.

18.  Change in Capital Structure.

     (a)  In the event of a stock dividend, stock split or combination of
          shares, share exchange, recapitalization or merger in which CSX is the
          surviving corporation or other change in CSX capital stock (including,
          but not limited to, the creation or issuance to shareholders generally
          of rights, options or warrants for the purchase of common stock or
          preferred stock of CSX), the number and kind of shares of stock or
          securities of CSX to be subject to the Plan and to Incentive Awards
          then outstanding or to be granted, the maximum number of shares or
          securities which may be delivered under the Plan under Sections 3(a),
          3(b), 6(b) or 9, the exercise price, the terms of Incentive Awards and
          other relevant provisions shall be adjusted by the Committee in its
          discretion, whose determination shall be binding on all persons. If
          the adjustment would produce fractional shares with respect to any
          unexercised Option, the Committee may adjust appropriately the number
          of shares covered by the Option so as to eliminate the fractional
          shares.

     (b)  If CSX is a party to a consolidation or a merger in which CSX is not
          the surviving corporation, a transaction that results in the
          acquisition of substantially all of CSX's outstanding stock by a
          single person or entity, or a sale or transfer of substantially all of
          CSX's assets, the Committee may take such actions with respect to
          outstanding Incentive Awards as the Committee deems appropriate.

     (c)  Notwithstanding anything in the Plan to the contrary, the Committee
          may take the foregoing actions without the consent of any Participant,
          and the Committee's determination shall be conclusive and binding on
          all persons for all purposes.

19.  Administration of the Plan.

                                      -10-

<PAGE>

     (a)  Prior to a Change in Control, the Committee shall administer the Plan.
          The Committee shall have general authority to impose any term,
          limitation or condition upon an Incentive Award that the Committee
          deems appropriate to achieve the objectives of the Incentive Award.
          The Committee may adopt rules and regulations for carrying out the
          Plan with respect to Participants. The interpretation and construction
          of any provision of the Plan by the Committee shall be final and
          conclusive as to any Participant.

     (b)  Except as provided in Section 5(b), the Committee shall have the power
          to amend the terms of previously granted Incentive Awards that were
          granted by that Committee so long as the terms as amended are
          consistent with the terms of the Plan and provided that the consent of
          the Participant is obtained with respect to any amendment that would
          be detrimental to him or her, except that such consent will not be
          required if such amendment is for the purpose of complying with Rule
          16b-3 or any requirement of the Code applicable to the Incentive
          Award.

     (c)  The Committee shall have the power and complete discretion (i) to
          delegate to any individual, or to any group of individuals employed by
          the Company or any Subsidiary, the authority to grant Stock Awards
          under the Plan and (ii) to determine the terms and limitations of any
          delegation of authority; provided that no individual Stock Award
          granted under a delegation by the Committee may exceed a Fair Market
          Value of $500,000 on the Date of Grant.

     (d)  Following a Change in Control, the Benefits Trust Committee, at its
          discretion, may assume any or all of the duties and responsibilities
          of the Committee as to the Plan. All actions by the Benefits Trust
          Committee shall be consistent with the provisions of the CSX
          Corporation and Affiliated Companies Benefits Assurance Trust.

     (e)  If the Participant's Employer is involved in a Divisive Transaction,
          the Committee may take such actions with respect to outstanding
          Incentive Awards as the Committee deems appropriate.

     (f)  If a Participant or former Participant (1) becomes associated with,
          recruits or solicits customers or other employees of an Employer, is
          employed by, renders services to, or owns any interest in (other than
          any nonsubstantial interest, as determined by the Committee) any
          business that is in competition with CSX, its Subsidiaries, Foreign
          Affiliates or Affiliates, (2) has his employment terminated by his
          Employer on account of actions by the Participant which are
          detrimental to the interests of CSX, its Subsidiaries, Foreign
          Affiliates or Affiliates, or (3) engages in, or has engaged in,
          conduct which the Committee determines to be detrimental to the
          interests of CSX, the Committee may, in its sole discretion, cancel
          all outstanding Incentive Awards, including immediately terminating
          any options held by the Participant, regardless of whether then
          exercisable.

     (g)  In the event of the death of a Participant, any outstanding Incentive
          Awards that are otherwise exercisable may be exercised by the
          Participant's Beneficiary or, if no Beneficiary is designated, by the
          personal representative of the Participant's estate or by the person
          to whom rights under the Incentive Award shall pass by will or the
          laws of descent and distribution.

20.  Change in Control.

     (a)  Notwithstanding any provision of the Plan or any Incentive Award to
          the contrary:

                                      -11-

<PAGE>

          (i) Upon the occurrence of the date of a Change in Control, (i) all
          Options and Stock Appreciation Rights granted before February 13, 2001
          shall become fully exercisable, (ii) all terms and conditions on
          Restricted Stock and Restricted Stock Units granted before February
          13, 2001 shall be deemed satisfied, and (iii) all Performance Grants,
          Stock Awards and Dividend Equivalents granted before February 13, 2001
          shall be deemed to be fully earned and to be immediately payable in
          cash;

          (ii)upon the occurrence of the date of a Vesting Event, (i) all
          Options and Stock Appreciation Rights granted on or after February 13,
          2001 shall become fully exercisable, (ii) all terms and conditions on
          Restricted Stock and Restricted Stock Units granted on or after
          February 13, 2001 shall be deemed satisfied, and (iii) all Performance
          Grants, Stock Awards and Dividend Equivalents granted on or after
          February 13, 2001 shall be deemed to be fully earned and to be
          immediately payable in cash;

          (iii) all Options and Stock Appreciation Rights held by a Participant
          (A) who resigns within three months after an event constituting Good
          Reason or (B) whose employment is terminated without Cause by the
          Company or an Affiliate, in either case upon or after an event
          described in Section 2(g)(iii) or 2(g)(iv) and prior to the earlier of
          (x) the consummation of such event, i.e., actual change in ownership
          of Outstanding Corporation Common Stock, Outstanding Corporation
          Voting Stock, and/or assets of CSX or its principal Subsidiary and (y)
          the determination by the Board of Directors that such event has been
          unwound or reversed or is no longer expected to be consummated, which
          Options and Stock Appreciation Rights were not fully exercisable at
          the time of such termination of employment, shall become fully
          exercisable upon the consummation of the event described in Section
          2(g)(iii) or 2(g)(iv), as applicable. Such Options and Stock
          Appreciation Rights shall be exercisable following the consummation of
          such event for the period specified in the Incentive Award for
          exercise following termination of employment other than due to death
          or Disability or until the expiration of the original option term, if
          sooner; provided, that prior to consummation of such event or a Board
          of Directors determination, as referenced above, such Options and
          Stock Appreciation Rights shall remain outstanding and be exercisable
          only at the time and to the extent set forth in the Incentive Award;

          (iv)any terms and conditions of all Restricted Stock and Restricted
          Stock Units held by a Participant (A) who resigns within three months
          of an event constituting Good Reason or (B) whose employment is
          terminated without Cause by the Company or an Affiliate, in either
          case upon or after an event described in Section 2(g)(iii) or 2(g)(iv)
          and prior to the earlier of (x) the consummation of such event, i.e.,
                                                                          ----
          actual change in ownership of Outstanding Corporation Common Stock,
          Outstanding Corporation Voting Stock, and/or assets of CSX or its
          principal Subsidiary and (y) the determination by the Board of
          Directors that such event has been unwound or reversed or is no longer
          expected to be consummated, which terms and conditions had not been
          satisfied at the time of such termination of employment, shall be
          deemed satisfied upon the consummation of the event described in
          Section 2(g)(iii) or 2(g)(iv), as applicable; provided, that prior to
          the consummation of such event or a Board of Directors determination,
          as referenced above, such Restricted Stock and Restricted Stock Units
          shall remain outstanding and be subject to the terms and conditions
          set forth in the Incentive Award; and

                                      -12-

<PAGE>
          (v) all Performance Grants, Stock Awards and Dividend Equivalents held
          by a Participant (A) who resigns within three months of an event
          constituting Good Reason or (B) whose employment is terminated without
          Cause by the Company or an Affiliate, in either case upon or after an
          event described in Section 2(g)(iii) or 2(g)(iv) and prior to the
          earlier of (x) the consummation of such event, i.e., actual change in
                                                         ----
          ownership of Outstanding Corporation Common Stock, Outstanding
          Corporation Voting Stock, and/or assets of CSX or its principal
          Subsidiary and (y) the determination by the Board of Directors that
          such event has been unwound, reversed, or is no longer expected to be
          consummated, which had not been fully earned at the time of such
          termination of employment, shall be deemed to be fully earned and
          immediately payable in cash upon the consummation of the event
          described in Section 2(g)(iii) or 2(g)(iv), as applicable; provided,
          that prior to the consummation of such event or a Board of Directors'
          determination, as referenced above, such Performance Grants, Stock
          Awards and Dividend Equivalents shall remain outstanding and be
          subject to the terms and conditions set forth in the Incentive Award.

     (b)  Upon a Change in Control, CSX or the Employer of the Participant
          shall, as soon as possible, but in no event more than seven days
          following a Change in Control, make an irrevocable contribution to the
          Benefits Trust in an amount that is sufficient to pay each Participant
          or Beneficiary of this Plan the unfunded portion of the benefits (i)
          to which Participants of this Plan or their Beneficiaries are entitled
          and for which the Company is liable pursuant to the terms of this Plan
          as of the date on which the Change in Control occurred and (ii) if the
          Change in Control is not also a Vesting Event, to which Participant or
          their Beneficiaries would be entitled and for which the Company would
          be liable if the Change of Control had been a Vesting Event. The
          amount of the Company's irrevocable contribution shall be based on the
          accounting for the most recent calendar year or more recent period for
          the Plan, as approved by an independent actuary or accountant engaged
          by the Company prior to the Change in Control and approved by the
          Benefits Trust Committee, if selected or changed following a Change in
          Control (the "Actuary"), and shall include an amount deemed necessary
          to pay estimated administrative expenses for the following five years.
          The Benefits Trust Committee shall cause such accounting to be
          updated, using participant data supplied to the Actuary by the
          Company, through a date no earlier than the date of the initial
          contribution and notify the Company of the amount of additional
          contributions required as soon as possible. The Benefits Trust is the
          CSX Corporation and Affiliated Companies Executives' Stock Trust or
          other similar trusts sponsored by CSX or another Employer.

21.  Interpretation. The terms of this Plan shall be governed by the laws of the
     Commonwealth of Virginia without regard to its conflict of laws rules.

                                      -13-<PAGE>

                                                                    Exhibit 10.1

                                January 14, 2002

E. Ryker Young
4 Andover Country Club Lane
Andover, MA 01810

Dear Ryker:

       The purpose of this letter agreement and general release (the
"Agreement") is to confirm the terms regarding your separation from employment
with Sycamore Networks, Inc./1// ("Sycamore" or the "Company").

       1. Separation From Employment. You acknowledge that your employment with
          --------------------------
Sycamore Networks, Inc. ("Sycamore" or the "Company") will cease as of
January 18, 2002 ("Separation Date"). You acknowledge and agree that, as of
November 14, 2001 you were no longer a section 16 officer of the Company, and
that the Change of Control Agreement made between you and the Company as of
November 17, 1999 was terminated, rescinded and null and void as of November 14,
2001. You further acknowledge that except for (i) the specific consideration set
forth in this Agreement; (ii) earned but unpaid regular wages earned through the
Separation Date, which shall be paid on or about the Separation Date; and (iii)
accrued and unused paid time off days which have been accrued but not taken as
of the Separation Date, which shall be paid on or about the Separation Date, you
are not and shall not in the future be entitled to any other compensation
including, without limitation, other wages, commissions, bonuses, vacation pay,
holiday pay or any other form of compensation or benefit.

       2. Consideration. You understand that in consideration for your execution
          -------------
of this Agreement and your fulfillment of the promises made herein, Sycamore
agrees to provide you with the following consideration:

          (a) Payment. Sycamore agrees to pay you the gross sum of Five Thousand
Dollars ($5,000.00), less applicable legal tax withholdings and deductions, to
be paid by check made payable to E. Ryker Young, which check shall be mailed to
you within fifteen (15) business days from the Separation Date.

          (b) Sycamore Stock and/or Stock Options.

_______________

/1//  For the purposes of this Agreement, the parties agree that the term
"Sycamore" includes Sycamore Networks, Inc., and any and all of its present and
former subsidiaries, branches, divisions, affiliates, successors, assigns or
related entities, as well as its or their present and former officers,
directors, trustees, employees and agents, individually and in their official
capacities, and its and their respective current and former officers, directors,
employees, agents and assigns.

<PAGE>

                   (i)   Sycamore agrees that any stock options and/or
                         restricted stock offered to you under any applicable
                         plans or agreements (including amendments thereto)
                         related to Sycamore stock, stock exchange programs,
                         and/or stock options ("Stock Plans"), that would have
                         vested after the Separation Date and on or before
                         August 17, 2002 will become vested as of the Separation
                         Date, subject to all of the other terms of the Stock
                         Plans;

                   (ii)  You acknowledge and agree that except as provided in
                         paragraph 2(b)(i) above, any stock options and /or
                         restricted stock granted to you under any Stock Plans
                         and any purchase rights under any Stock Plans
                         previously offered, granted or awarded to you that are
                         not vested as of the Separation Date shall be forfeited
                         and canceled in their entirety as of the close of
                         business on the Separation Date.

                   (iii) You further acknowledge and agree that from and after
                         the Separation Date, you shall not have any rights to
                         vest in stock and/or stock options under any Stock
                         Plan. Your further hereby acknowledge and agree that
                         Sycamore's time to exercise any right to repurchase any
                         unvested shares, other than those referenced in
                         Paragraph 2(b) (i) above, pursuant to the Stock Plans
                         will begin as of the Separation Date. You further
                         acknowledge and agree that, while you understand that,
                         as of the Separation Date, you are no longer an
                         employee of the Company, and therefore not subject to
                         any trading restrictions, including blackout policies,
                         you understand that compliance with insider trading
                         laws is an individual obligation and that you are still
                         legally obligated to comply with such laws. You further
                         agree to indemnify and hold harmless Sycamore from any
                         and all claims, actions, investigations and judgments
                         arising from or related to any violation by you, actual
                         or alleged, of the insider trading laws relative to
                         Company stock.

          3. Conditions Applying to Payment of Benefits. You understand and
             ------------------------------------------
agree that the consideration that you will receive pursuant to paragraph 2 above
is subject to and contingent upon (a) your compliance with the terms and
conditions set forth in this Agreement; (b) your timely execution of the
Agreement; (c) your complete return of all Company property and execution of the
Checklist of Items to be Returned on your Separation Date; and (d) your
execution of the company Acknowledgement of Post-Employment Obligations on your
Separation Date.

          4. Confidentiality, Non-Solicitation, and Non-Disclosure. You agree
             -----------------------------------------------------
that that all information relating in any way to the negotiation of this
Agreement, including the terms of this Agreement, shall be held confidential by
you and shall not be publicized or disclosed to any

                                        2

<PAGE>

person (other than an immediate family member, legal counsel or financial
advisor, provided that any such individual to whom disclosure is made agrees to
be bound by these confidentiality obligations), business entity or government
agency (except as mandated by state or federal law).
During the term of your employment with the Company, and for a period of twelve
(12) months thereafter, you shall not, directly or indirectly, without prior
written consent of the Company, (1) solicit or encourage, or cause others to
solicit or encourage, any employees of the Company to terminate their employment
with the Company, or (2) solicit or accept employment or be retained by any
party who, at any time during the term of your employment, was a competitor,
client or customer of the Company. You agree that to the extent this paragraph
conflicts with the Invention, Non-Disclosure and Non-Solicitation Agreement
executed by you on or about September 14, 1998, this paragraph will be
controlling and will supersede any conflicting paragraphs in the September 1998
agreement. You further agree that a breach of this Section shall constitute a
material breach of this Agreement and shall entitle Sycamore to all legal or
equitable relief available.

          5. Cooperation. You agree that you shall assist and cooperate with
             -----------
Sycamore in connection with any matters that you were involved during the course
of your employment including, without limitation, in the defense or prosecution
of any claims or actions now in existence or which may be brought or threatened
in the future against or on behalf of Sycamore (including any claims or actions
against its officers, directors and employees). Your cooperation in connection
with such matters, actions and claims shall include, without limitation, being
available to meet with Sycamore regarding such matters in which you have been
involved, and any contract matters or audits; to prepare for any proceeding
(including, without limitation, depositions, consultation, discovery or trial);
to provide affidavits; to assist with any audit, inspection, proceeding or other
inquiry; and/or to act as a witness in connection with any litigation or other
legal proceeding affecting Sycamore. Sycamore agrees that it will reimburse you
for out of pocket expenses incurred in connection with such cooperation,
including fees for independent legal counsel if Sycamore deems, in its sole
discretion, that: (i) such counsel is necessary, (ii) such counsel is selected
by Sycamore; and (iii) Sycamore has sole authority to approve or disapprove of
such counsel's invoices.

          You understand and agree that if this Agreement were not signed, you
would have the right to voluntarily assist other individuals or entities in
bringing claims against the Company. You hereby waive that right and agree that
you will not provide any such assistance other than assistance to an
administrative agency of the United States government or Commonwealth of
Massachusetts in connection with an investigation or proceeding conducted by
such administrative agency. You further agree that should you be contacted
(directly or indirectly) by any person or entity (for example, by any party
representing an individual or entity) adverse to Sycamore, you shall promptly
(within 48 hours) notify Robin A. Friedman, Vice President of Human Resources,
or her designee.

          Sycamore represents that its primary D & O insurance policy states
that it covers "all persons who were, now are, or shall be directors or officers
of the Company and all persons serving in a functionally equivalent role for the
parent company or any Subsidiary operating or incorporated outside of the United
States."

                                        3

<PAGE>

          6. Release of Claims. You hereby agree and acknowledge that in
             -----------------
consideration of the items set forth in Paragraph 2 above, and for other good
and valuable consideration, the receipt of which is hereby acknowledged, you
knowingly and voluntarily release and forever discharge Sycamore and any and all
of its subsidiaries, branches, divisions, affiliates, insurers, successors,
assigns or related entities, as well as its or their present and former
officers, directors, trustees, employees, and agents, individually and in their
official capacities, (collectively, the "Released Parties") of and from any and
all claims, known and unknown, that you, your heirs, executors, administrators,
successors, and assigns, have had or may have as of the date of execution of
this Agreement, including, but not limited to, any alleged violation of:

          .  The National Labor Relations Act;
          .  Title VII of the Civil Rights Act of 1964;
          .  The Civil Rights Act of 1991
          .  Sections 1981 through 1988 of Title 42 of the United States Code;
          .  The Employee Retirement Income Security Act of 1974;
          .  The Immigration Reform Control Act;
          .  The Americans with Disabilities Act of 1990;
          .  The Fair Labor Standards Act;
          .  The Occupational Safety and Health Act;
          .  The Family and Medical Leave Act of 1993;
          .  The Worker Adjustment and Retraining Notification Act;
          .  The Massachusetts Fair Employment Practices Act;
          .  The Massachusetts State Wage and Hour Laws;
          .  The Massachusetts Occupational Safety and Health Laws;
          .  The Massachusetts Equal Rights Act;
          .  The Massachusetts Civil Rights Act;
          .  The Massachusetts Privacy Law;
          .  The Massachusetts Sexual Harassment Statute;
          .  The Massachusetts Consumer Protection Act;
          .  The Massachusetts Small Necessities Leave Act;
          .  The Massachusetts Plant Closing Law;
          .  The Oklahoma Civil Rights Act;
          .  The Oklahoma State Wage and Hour Laws;
          .  The Oklahoma Equal Pay Act;
          .  The Oklahoma Anti-Discrimination Act;
          .  The Oklahoma Human Rights Commission's Guidelines on Employment
             Discrimination;
          .  The Oklahoma Health and Safety Standards Act;
          .  any other federal, state or local civil or human rights law or any
             other local, state or federal law, regulation or ordinance;

                                        4
`

<PAGE>

          .   any public policy, contract, tort, or common law, or any claim
              based on theories of respondeat superior and/or strict liability;
              or
          .   any allegation for costs, fees, or other expenses including
              attorneys' fees incurred in these matters.

          You acknowledge and agree that, but for providing this waiver and
release, you would not be receiving the consideration being provided to you
under the terms of this Agreement.

           7. No Claims Exist. By signing this Agreement, you confirm that you
              ---------------
are not a party to any claim, charge, complaint or action in any forum or form
against Sycamore. You confirm that you will not file any claim, charge,
complaint or action against Sycamore on your own behalf or on behalf of any
class in which you could be a member in the future; provided, however, that this
provision does not bar the filing of a complaint or charge with the EEOC or
MCAD. In the event that any such claim, charge, complaint or action is filed,
you agree that you shall not be entitled to any relief or recovery therefrom,
including costs and attorneys' fees.

           8. Nonadmission of Wrongdoing. You agree that neither this Agreement
              --------------------------
nor the furnishing of the consideration for this Agreement shall be deemed or
construed at any time for any purpose as an admission by Sycamore of any
liability or unlawful conduct of any kind.

           9. Entire Agreement/Choice of Law/Enforceability. You acknowledge and
              ---------------------------------------------
agree that, with the exception of the Stock Plans (as modified in Paragraph 2
above) and the Invention, Non-Disclosure and Non-Solicitation Agreement executed
by you on or about September 14, 1998 (as modified by Paragraph 4 above), this
Agreement supersedes any and all prior or contemporaneous oral and/or written
agreements between you and Sycamore, and sets forth the entire agreement between
you and Sycamore concerning the subject matter contained herein. No variations
or modifications hereof shall be deemed valid unless reduced to writing and
signed by the parties hereto. This Agreement shall be deemed to have been made
in the Commonwealth of Massachusetts, shall take effect as an instrument under
seal within Massachusetts, and shall be governed by and construed in accordance
with the laws of the Commonwealth of Massachusetts, without giving effect to
conflict of law principles. You acknowledge and agree that any action, demand,
claim or counterclaim relating to the terms and provisions of this Agreement, or
to its breach, shall be commenced in Massachusetts in a court of competent
jurisdiction, and you further acknowledge that venue for such actions shall lie
exclusively in Massachusetts and that material witnesses and documents would be
located in Massachusetts.

          10. Severability and Amendment. Should any provision of this Agreement
              --------------------------
be declared illegal or unenforceable by a court of competent jurisdiction and
cannot be modified to be enforceable, excluding the general release of claims
language, such provision shall immediately become null and void, leaving the
remainder of this Agreement in full force and effect. If the general release of
claims language is found by a court of competent jurisdiction to be
unenforceable, you agree that Sycamore may rewrite this Agreement to cure the
defect, and you shall promptly execute the rewritten agreement upon the request
of Sycamore without any

                                        5

<PAGE>

additional monies, benefits, or compensation therefore.

          It is Sycamore's desire and intent to make certain that you fully
understand the provisions and effects of this letter. To that end, Sycamore has
provided you with more than ten (10) days in which to consider and accept the
terms of this Agreement. Please sign below and return it to Robin A. Friedman,
Vice President of Human Resources, at Sycamore.

          By executing this Agreement, you are acknowledging that you have been
afforded sufficient time to understand the terms and effects of this letter,
that your agreements and obligations hereunder are made voluntarily, knowingly
and without duress, and that neither Sycamore nor its agents or representatives
have made any representations inconsistent with the provisions of this letter.

          If the foregoing correctly sets forth our understanding, please sign,
date and return the enclosed copy of this letter to Robin A. Friedman, Vice
President of Human Resources, at Sycamore.

                                            Very truly yours,

                                            Sycamore Networks, Inc.

                                            By:      /s/ Robin A. Friedman
                                                   ------------------------

                                            Dated:   January 16, 2002
                                                   ------------------------

Confirmed, Agreed and Acknowledged

  /s/ E. Ryker Young
----------------------------------
  E. Ryker Young

Dated:   January 17, 2002
       ---------------------------

                                        6

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