Document:

ex103.htm

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Exhibit 10.3

    CSX
Directors’ Deferred Compensation Plan

    Effective
January 1, 2005

     

    The
purpose of the Plan is to permit members of the Board of Directors of CSX
Corporation to defer the receipt of director’s fees and to allow CSX Corporation
to make other deferred awards to directors.  The Plan is intended to
be fully compliant with Section 409A of the Internal Revenue Code of 1986, as
amended, and the final regulations promulgated thereunder.

     

    
      	
              1.  

            	
              Definitions

            

    

     

    The
following words or terms used herein shall have the indicated
meanings:

     

    
      	
              (a)  

            	
              “Account” or
      “Accounts” --
      means the bookkeeping account(s) maintained for each Participant to record
      the amount of Director’s Fees the Member has elected to defer and other
      deferrals, as adjusted pursuant to Section
4.

            

    

     

    
      	
              (b)  

            	
              “Administrator”
      -- means the Senior Human Resources Officer of CSX Corporation or such
      officer’s designee.

            

    

     

    
      	
              (i)  

            	
              The
      Administrator shall be responsible for the general administration of the
      Plan, claims review, and for carrying out its
      provisions.  Administration of the Plan shall be carried out
      consistent with the terms of the
Plan.

            

    

     

    
      	
              (ii)  

            	
              The
      Administrator shall have sole and absolute discretion to interpret the
      Plan and determine eligibility for and benefits
      hereunder.  Decisions of the Administrator regarding
      participation in and the calculation of benefits under the Plan shall at
      all times be binding and conclusive on Participants, their beneficiaries,
      heirs and assigns.

            

    

     

    
      	
              (c)  

            	
              “Average
      Price” -- means the average of the high and low price for CSX common stock
      as reported on the New York Stock Exchange - Composite Listing (“NYSE”) on
      the date of the applicable deferral or dividend
  payment.

            

    

     

    
      	
              (d)  

            	
                “Board” -- means
      the Board of Directors of CSX.

            

    

     

    
      	
              (e)  

            	
              “Change of
      Control” -- means any of the
following:

            

    

     

    
      	
              (i)  

            	
              Stock
      Acquisition.  One or more acquisitions, by any
      individual, entity or group (within the meanings of Treas. Reg.
      §§ 1.409A-3(i)(5)(v)(B) and (vi)(D)) (a “Person”), of (A) 30% or
      more of the then outstanding voting securities of the Corporation (the
      “Outstanding Voting Securities”), during any 12-month period ending on the
      date of the most recent acquisition; or (B) an acquisition that
      results in ownership by a Person of more than 50% of either (a) shares
      representing more than 50% of the total fair market value of the
      Corporation’s then outstanding stock (the “Outstanding Stock”) or (b) the
      then Outstanding Voting Securities; provided, however, that
      for purposes of this subsection (i), the following acquisitions of shares
      of the Corporation shall not be taken into account in the determination of
      whether a Change of Control has occurred:  (A) any acquisition
      directly from the Corporation; (B) any cash acquisition by the
      Corporation; (C) any acquisition by any employee benefit plan (or related
      trust) sponsored or maintained by the Corporation or any corporation
      controlled by the Corporation; or (D) an acquisition by a Person that
      prior to the acquisition had already acquired more shares than necessary
      to satisfy the applicable 30% or 50% threshold.  Notwithstanding
      the foregoing, an acquisition of its stock by the Corporation in exchange
      for property which increases the percentage of stock owned by a Person
      shall be treated as an acquisition for purposes of this subsection;
      or

            

    

     

    
      	
              (ii)  

            	
              Board
      Composition.  Individuals who, as of the date hereof,
      constitute the Board  (the “Incumbent Board”) cease, within a
      12-month period, for any reason to constitute at least a majority of the
      Board; provided, however, that
      any individual becoming a director subsequent to such date whose
      appointment, election, or nomination for election by the Corporation’s
      shareholders, was endorsed by 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;
  or

            

    

     

    
      	
              (iii)  

            	
              Business
      Combination.  Consummation of a reorganization, merger or
      consolidation of the Corporation (a “Business Combination”), in each case,
      that results in either a change in ownership contemplated in subsection
      (i)(B) of this Section 1(e) or a change in the Incumbent Board
      contemplated by subsection (ii) of Section 1(e);
  or

            

    

     

    
      	
              (iv)  

            	
              Sale or Disposition of
      Assets.  One or more Persons acquires (or has acquired
      during the 12-month period ending on the date of the most recent
      acquisition by such Persons) assets from the Corporation that have a total
      gross fair market value equal to more than 40 percent of the total gross
      fair market value of all of the assets of the Corporation (without regard
      to liabilities of the Corporation or associated with such assets)
      immediately before such acquisition or acquisitions; provided that such
      sale or disposition is not to:

            

    

     

    
      	
              (A)  

            	
              a
      shareholder of the Corporation (immediately before the asset transfer) in
      exchange for or with respect to the Corporation’s Outstanding
      Stock;

            

    

     

    
      	
              (B)  

            	
              an
      entity, 50% or more of the total value or voting power of which is owned,
      directly or indirectly, by the
Corporation;

            

    

     

    
      	
              (C)  

            	
              a
      Person that owns, directly or indirectly, 50% or more of the total value
      or voting power of all the outstanding stock of the Corporation;
      or

            

    

     

    
      	
              (D)  

            	
              an
      entity, at least 50% of the total value or voting power of which is owned,
      directly or indirectly, by a Person described in subsection
      (iv)(C).

            

    

     

    Except as
otherwise specifically provided in subsection (iv)(A) of this Section 1(e), a
Person’s status is determined immediately after the transfer.

     

    
      	
              (f)  

            	
              “Closing
      Price”--  means the closing price for CSX common stock as
      reported on the New York Stock Exchange - Composite Listing (“NYSE”) on
      the date of the applicable deferral or dividend
  payment.

            

    

     

    
      	
              (g)  

            	
               “Code”
      -- means the Internal Revenue Code of 1986, as
  amended.

            

    

     

    
      	
              (h)  

            	
              “CSX” or “Corporation” --
      means CSX Corporation

            

    

     

    
      	
              (i)  

            	
              “Deferral
      Agreement” -- means an agreement between a Participant and CSX
      under which the Participant agrees to defer Director’s Fees under the
      Plan.  The Deferral Agreement shall be on a form prescribed by
      the Administrator and shall include any amendments, attachments or
      appendices.

            

    

     

    
      	
              (j)  

            	
              “Designated
      Beneficiary” -- means the person or persons entitled to receive the
      balance of a Participant’s Accounts upon the Participant’s
      death.  The Participant may file with the Administrator a
      written Designation of Beneficiary for this purpose.  Such
      designation may name one or more individuals, trusts and/or organizations
      as the primary or contingent beneficiary(ies) to receive all or a
      specified portion of the balance of the Participant’s Accounts remaining
      at the Participant’s death.  Unless otherwise specifically
      directed in the Participant’s Designation of Beneficiary form, in the
      event a designated primary beneficiary is not living or existing at the
      Participant’s death or declines to accept any distribution from the
      Accounts, the share otherwise distributable to such beneficiary shall be
      distributed, first, to the other designated primary beneficiaries, if any,
      in accordance with their relative designated shares of the Accounts; and
      second, to the contingent beneficiary(ies), if
  any.

            

    

     

    
      	
              (k)  

            	
              “Director’s
      Fees” -- means any compensation, whether a retainer, or a fee for
      meeting attendance, membership on a committee, chairing a committee, or
      otherwise, payable either in cash or in stock, earned by a Member for
      services rendered as a Member.

            

    

     

    
      	
              (l)  

            	
              “Effective Date”
      -- means January 1, 2005.

            

    

     

    
      	
              (m)  

            	
              “Fiscal Year” --
      means the Corporation’s taxable year ending on the last Friday in
      December.

            

    

     

    
      	
              (n)  

            	
              “Form of Payment
      Election” -- means the election by the Participant of the form of
      distribution (lump sum or installments) he or she will receive from his or
      her Account pursuant to Section 6.

            

    

     

    
      	
              (o)  

            	
              “Independent
      Advisor” -- means an independent accountant, actuary, benefits
      consulting firm or other entity engaged by CSX to provide Participant
      accounting or other services on behalf of the
  Plan.

            

    

     

    
      	
              (p)  

            	
              “Member” --
      means any person duly elected to the
Board.

            

    

     

    
      	
              (q)  

            	
              “Participant” --
      means any Member who elects to participate in the Plan so long as he or
      she is entitled to a benefit under the
Plan.

            

    

     

    
      	
              (r)  

            	
              “Plan” -- means
      the CSX Directors Deferred Compensation
Plan.

            

    

     

    
      	
              (s)  

            	
              “Trust” -- means
      a grantor trust or trusts established by CSX which substantially conforms
      to the terms of the Internal Revenue Service model trust as described in
      Revenue Procedure 92-64, 1992-2 C.B. 422.  CSX is not obligated
      to make any contribution to the
Trust.

            

    

     

    In any
instance in which the male gender is used herein, it shall also include persons
of the female gender in appropriate circumstances.

     

    
      	
              2.  

            	
              Participation

            

    

     

    Any
Member who filed a Deferral Agreement in 2004 under and in accordance with the
CSX Corporation 2002 Corporate Director Deferred Compensation Plan with respect
to Directors Fees earned in 2005, shall be deemed to have filed such Deferral
Agreement under this Plan and shall be a Participant in this Plan.

     

    A Member
may elect to become a Participant and defer Director’s Fees earned and payable
in any subsequent calendar year by entering into a Deferral Agreement with the
Administrator  no later than the last non-holiday business day of the
Fiscal Year ending immediately prior to the calendar year in question or such
earlier date as may be specified by the Administrator.  Such Deferral
Agreement shall be effective for purposes of deferring Director’s Fees earned in
the calendar year following the date the Deferral Agreement is
executed.  Any election made pursuant to a Deferral Agreement shall
remain in effect with respect to future calendar years until changed or
rescinded by the Participant in accordance with the Plan.

     

    
      	
              3.  

            	
              Deferral of Directors’
      Fees

            

    

     

    
      	
              (a)  

            	
              CSX
      shall, during any calendar year with respect to which a Participant has
      made a timely Deferral Election, withhold and defer payment of all or any
      specified part of Participant’s Director’s Fees in accordance with the
      Director’s Deferral Election.  A Participant may elect to change
      the amount of Director’s Fees he or she elects to defer, modify a Deferral
      Agreement or revoke a Deferral Agreement by filing a new Deferral
      Agreement pursuant to procedures established by the Administrator with the
      Administrator not later than the last day of the Fiscal Year immediately
      prior to the calendar year in which Director’s Fees are to be earned and
      paid, and such revised Deferral Agreement shall be effective with respect
      to Director’s Fees earned for all future calendar years until changed or
      rescinded in accordance with the
Plan.

            

    

     

    
      	
              (b)  

            	
              Notwithstanding
      Sections 2 and 3(a), when any person first becomes a Member, he or she may
      file an initial Deferral Agreement during the first thirty (30) days he or
      she is a Member, and such Deferral Agreement shall be effective solely
      with respect to Director’s Fees paid for services to be performed after
      such election.  For Director’s Fees that are earned based upon a
      specified performance period (for example, an annual bonus), where a
      Member’s Deferral Election is made in the first year of eligibility but
      after the beginning of the performance period, the Deferral Election must
      apply only to the Director’s Fees paid for services performed after such
      election.  For this purpose, a Deferral Election will be deemed
      to apply to Director’s Fees paid for services performed after the election
      if the Deferral Election applies to no more than an amount equal to the
      total amount of the Director’s Fees for the performance period multiplied
      by the ratio of the number of days remaining in the performance period
      after the Deferral Election over the total number of days in the
      performance period.

            

    

     

    
      	
              (c)  

            	
              Notwithstanding
      any provision of the Plan to the contrary, on or prior to December 31,
      2005, a Participant may cancel his or her participation in the Plan, may
      cancel an existing Deferral Agreement, or may reduce the amount of
      Directors’ Fees deferred under an existing Deferral
    Agreement.

            

    

     

    
      	
              4.  

            	
              Participants’
      Accounts

            

    

     

    
      	
              (a)  

            	
              So
      long as he or she is a Member, a Participant may elect pursuant to a
      Deferral Agreement or other forms or procedures provided or established by
      the Administrator to have all or any portion of his or her eligible
      Director’s Fees, not required to be credited or actually credited to his
      or her Stock Account under the Plan pursuant to the terms of the CSX
      Corporation Stock Plan for Directors or otherwise, credited as
      follows:

            

    

     

    Through December 31,
2005:

     

    To an
interest-accruing account (“Interest Account”) or a CSX Phantom Stock Account
(“Phantom Stock Account”).

     

    After December 31,
2005:

     

    To an
Account or Accounts related to and accounted for in the same manner as the
earnings benchmarks used in conjunction with the CSX Executives’ Deferred
Compensation Plan (the “EDC Plan”) (a “Benchmark Account”) approved from time to
time by the Administrator.

     

    
      	
              (b)  

            	
              Elective
      Deferrals of CSX common stock shall be effected pursuant to Deferral
      Agreements filed with the Administrator.  A Participant’s Stock
      Account  (“Stock Account”) will be credited  with such
      deferrals.

            

    

     

    
      	
              (c)  

            	
              Through
      December 31, 2005, interest shall accrue on a Participant’s Interest
      Account from the first day of the month following the date the deferred
      Director’s Fee would otherwise have been paid to the Participant until it
      is actually paid, such interest to be credited to an affected
      Participant’s Account and compounded quarterly at the end of each calendar
      quarter.    Interest will be credited quarterly based
      on the annual rate of 10-year U.S. Treasury bonds as published by the
      Wall Street
      Journal as of the first business day of October in the preceding
      calendar year.  The value of a Participant’s Interest Account
      shall be the sum of amounts deferred and all interest accrued
      thereon.  Interest Accounts ceased to exist as of December 31,
      2005.  All undistributed amounts credited to such accounts were
      credited to a Benchmark Account, effective January 1,
  2006.

            

    

     

    
      	
              (d)  

            	
              Credits
      (including both deferrals of Directors’ Fees and dividends) to and the
      value of Phantom Stock Accounts are based upon Average Price. Credits to
      and the value of Stock Accounts (other than deferred CSX common stock
      share awards declared by the Company), are based upon Average Price
      through December 31, 2007, and Closing Price
      thereafter.  Notwithstanding the preceding, full and fractional
      shares credited to Stock Accounts pertaining to dividends on CSX common
      stock held by the trustee of the Directors’ Stock Trust or a successor
      trust shall be credited based on the actual purchase price of the CSX
      common stock acquired by the trustee with such
  dividends.

            

    

     

    
      	
              (e)  

            	
              Through
      December 31, 2005, a Participant, while a Member, could elect at any time
      to transfer all or any portion of amounts deferred, including all earnings
      thereon, between his or her Interest Account and Phantom Stock
      Account.  After December 31, 2005, a participant may elect, on
      forms provided by and pursuant to rules established by the Administrator,
      to transfer all or any portion of amounts held in a Benchmark Account
      among such Accounts.  No transfers may be made into the Stock
      Account.  Transfers out of the Stock Account may only be made
      when a Participant is no longer a
Member.

            

    

     

    
      	
              5.  

            	
              Distribution of
      Deferred Directors’ Fees

            

    

     

    
      	
              (a)  

            	
              Amounts
      deferred under the Plan and/or credited to an Account shall be distributed
      to a Participant from such Account in a lump sum one year following the
      date in which a Participant ceases to be a Member, unless he or she shall
      file a Distribution and Form of Payment Election as provided in Sections 5
      and 6.

            

    

     

    
      	
              (b)  

            	
              A
      Participant may file with the Administrator a Distribution Election, in
      accordance with Section 5(c), for the distribution from an Account
      upon:

            

    

     

    
      	
              (i)  

            	
              attainment
      of a designated age; or

            

    

     

    
      	
              (ii)  

            	
              separation
      from the Board.

            

    

     

    For this
purpose, a separation from the Board will not be deemed to have occurred if the
Member continues to provide services to CSX at a level greater than 20% of the
average number of hours of services provided by the Member over the 36 (or, if
less, the full term of employment) months preceding his or her date of
separation from the Board.

     

    
      	
              (c)  

            	
              A
      Participant shall file a Distribution Election with respect to Director’s
      Fees deferred pursuant to a Deferral Agreement and other deferrals at the
      same time that such Deferral Agreement is filed as provided in Sections 2
      or 3.  A Participant may change a Distribution Election with
      respect to future elective deferrals at any time on or prior to the date
      by which any new or revised Deferral Agreement would have to be filed
      under Section 3(a).  Such revised Distribution Election shall be
      effective only with respect to Director’s Fees earned and deferred in
      calendar years commencing subsequent to such revised Distribution
      Election.

            

    

     

    
      	
              (d)  

            	
              Notwithstanding
      the foregoing, on or prior to December 31, 2005, a Participant may file a
      new Distribution Election with respect to amounts deferred under the Plan
      prior to such new Distribution
Election.

            

    

     

    
      	
              (e)  

            	
              Any
      Distribution Election made in proper form and at the proper time by a
      Participant shall be effective and distribution shall commence pursuant to
      such Distribution Election.  Any Distribution Election not made
      in proper form or at the proper time shall be void. Distributions from a
      Participant’s Stock Account shall be made only in shares of CSX common
      stock.

            

    

     

    
      	
              (f)  

            	
              Non-elective
      deferred cash or stock awards declared by the Corporation shall be
      credited to a Participant’s Benchmark or Stock Account as
      applicable.  Unless a Participant has made a different timely
      election, any such award shall be distributed at the same time and in the
      same form as the Participant’s last effective election prior to each such
      declaration or, if none, pursuant to Sections 5(a) and
  (e).

            

    

     

    
      	
              (g)  

            	
              A
      Participant may make additional elections to defer (but not accelerate)
      commencement of a payment elected pursuant to a prior Distribution
      Election (including a default election) under the Plan (a “Re-deferral
      Election”), provided that (A) such Re-deferral Election may not be
      effective for at least 12 months after the date on which it is filed; (B)
      the additional deferral with respect to which such Re-deferral Election is
      made may not be less than five years from the date such distribution would
      otherwise have been made, except in the case of elections relating to
      distributions on account of death; and (C) if such Re-deferral Election is
      to a designated age, such Re-deferral Election may not be made less than
      12 months prior to the date of the first scheduled payment under the
      Distribution Election then in effect.  Such Re-deferral Election
      shall be made on forms prescribed by the
  Administrator.

            

    

     

    
      	
              (h)  

            	
              Notwithstanding
      any provision of the Plan to the contrary, the Administrator shall, in a
      manner compliant with Code § 409A, make a lump sum distribution to a
      Participant to the extent necessary to comply with a certificate of
      divestiture, as defined in Code § 1043(b)(2), or, to the extent
      amounts deferred hereunder have become taxable as a result of Code
      § 409A.

            

    

     

    
      	
              (i)  

            	
              A
      Participant may elect with respect to any elective deferral to have the
      deferral paid in a lump sum within 45 days of a Change of
      Control.

            

    

     

    
      	
              6.  

            	
              Form of
      Payment

            

    

     

    A Form of
Payment Election provided in this Section 6, with respect to a Deferral
Agreement, shall be made in writing at the same time as the Distribution
Election filed with respect to such Deferral Agreement, and may be changed at
the same time and to the same extent as a Distribution Election may be changed,
as provided in Section 5, regardless of whether the Distribution Election is
changed.

     

    Notwithstanding
the foregoing, on or prior to December 31, 2005, a Participant may file a new
Form of Payment Election with respect to amounts deferred prior to such new Form
of Payment Election.

     

    A
Participant may elect either a lump sum payment, or semi-annual
installments.  Lump sum payments are made as soon as practicable after
the end of the month following the event triggering the
distribution.  If installment payments are elected, payments shall be
made, for either five, ten, fifteen, or twenty years.  Installment
payments shall be made as soon as practicable after each June 30 and December
31.  The amount of each installment shall be determined by multiplying
the value of the Participant’s account as of the last business day of June or
December immediately preceding the installment distribution date by a fraction,
the numerator of which shall be one (1) and the denominator of which shall be
the number of installment payments over which payment of such amount is to be
made, less the number of installment payments previously made.  In the
case of installments from a Stock Account, fractional share amounts shall be
rounded up to the next highest whole share amount, except in the case of the
final installment, in which case a cash payment will be made for any fractional
shares.  Installment payments shall be treated as one payment for
purposes of Code § 409A.

     

    
      	
              7.  

            	
              Death of a
      Participant

            

    

     

    
      	
              (a)  

            	
              In
      the event a Participant shall die while he or she is a Member, the balance
      of his or her Accounts shall be paid in either a lump sum or installments
      (consistent with the Form of Payment Elections made by the Participant as
      described in Section 6) to his or her Designated
    Beneficiary.

            

    

     

    
      	
              (b)  

            	
              In
      the event a Participant shall die after he or she ceases to be a Member
      and before he or she has received complete distribution from his or her
      Account, the balance credited to his or her Account shall be paid to his
      or her Designated Beneficiary consistent with the Form of Payment
      Elections made by the Participant as described in Section
    6.

            

    

     

    
      	
              (c)  

            	
              In
      the event a Participant shall not file a Designation of Beneficiary, or no
      Designated Beneficiary is living or existing at the Participant’s death,
      the balance credited to the Participant’s Accounts shall be paid in full
      to the Participant’s estate not later than the tenth day of the calendar
      year following his or her date of
death.

            

    

     

    
      	
              8.  

            	
              Obligation of
      CSX

            

    

     

    This Plan
shall be unfunded and credits to the Accounts of each Participant shall not be
set apart for the Participant nor otherwise made available so that the
Participant may draw upon them at any time, except as provided in this
Plan.  Neither any Participant nor his or her Designated Beneficiary
shall have any right, title, or interest in such credits or any claim against
them.  Payments may be made only at such times and in the manner
expressly provided in this Plan.  CSX’s contractual obligation is to
make the payments when due.  No notes or security for the payment of
any Participant’s account shall be issued by CSX.

     

    
      	
              9.  

            	
              Funding of
      Trusts

            

    

     

    CSX may,
in its sole discretion, fund one or more Trusts to assist it in discharging its
obligations hereunder.

     

    
      	
              10.  

            	
              Claims Against
      Participant’s Account

            

    

     

    No
credits to the account of any Participant under this Plan shall be subject in
any manner to anticipation, alienation, sale, transfer, assignment, pledge,
encumbrance, or charge, and any attempt to do so shall be void.  Nor
shall any credit be subject to attachment or legal process for debts or other
obligations.  Nothing contained in this Plan shall give any
Participant any interest, lien, or claim against any specific asset of
CSX.  No Participant or his or her Designated Beneficiary shall have
any rights other than as a general creditor of CSX.

     

    
      	
              11.  

            	
              Co-ordination with
      Payments from Trust or Similar
Vehicle

            

    

     

    The
obligations of CSX and the benefit due any Participant or Designated Beneficiary
under the Plan shall be reduced by any amount received in regard thereto under
the Trust or any similar trust or other vehicle.

     

    
      	
              12.  

            	
              Amendment or
      Termination

            

    

     

    This Plan
may be altered, amended, suspended, or terminated at any time by the Board,
provided, however, that no alteration, amendment, suspension, or termination
shall be made to this Plan which would result in a reduction in benefits accrued
through the date of such action.  Further, the Board may delegate its
authority to take such actions by charter or otherwise.

     

    
      	
              13.  

            	
              Impact of Future
      Legislation or Regulation

            

    

     

    
      	
              (a)  

            	
              This
      Section 14 shall become operative upon the enactment of any change in
      applicable statutory law or the promulgation by the Internal Revenue
      Service of a final regulation or other pronouncement having the force of
      law, which statutory law, as changed, or final regulation or
      pronouncement, as promulgated, would cause any Participant to include in
      his or her federal gross income amounts accrued by the Participant under
      the Plan on a date (an “Early Taxation Event”) prior to the date on which
      such amounts are made available to him or her
  hereunder.

            

    

     

    
      	
              (b)  

            	
              Notwithstanding
      any other Section of this Plan to the contrary (but subject to Section
      14(c), below), as of an Early Taxation Event, the feature or features of
      this Plan, or the election by a Participant that would cause the Early
      Taxation Event shall be null and void, to the extent, and only to the
      extent, required to prevent the Participant from being required to include
      in his or her federal gross income amounts accrued by the Participant
      under the Plan prior to the date on which such amounts are made available
      to him or her hereunder.  If only a portion of a Participant’s
      Account is impacted by the change in the law, then only such portion shall
      be subject to this Section, with the remainder of the Account not so
      affected being subject to such rights and features as if the law were not
      changed.  If the law impacts only Participants who have a
      certain status with respect to the Company, then only such Participants
      shall be subject to this Section.

            

    

     

    
      	
              (c)  

            	
              Notwithstanding
      Section 14(b) above, if an Early Taxation Event occurs, the amount that is
      required to be included in income as a result of a compliance failure
      under Code § 409A and the regulations promulgated thereunder, shall
      be distributed to the affected Participant as soon as practicable
      following such Early Taxation
Event.

            

    

     

    
      	
              (d)  

            	
              Notwithstanding
      Section 14(b) above, if an Early Taxation Event occurs, to the extent an
      amount is includable in income as a result of a compliance failure under
      Code § 409A or otherwise before such amount is distributable under
      the Plan, an amount equal to the total employment taxes on the Early
      Taxation Event and any applicable federal, state, local or foreign income
      tax withholding attributable to the payment of such amounts required to be
      withheld or paid and the income taxes required to be withheld thereon,
      shall be distributed to the affected Participant or paid to the
      appropriate taxing authority as soon as practicable following such Early
      Taxation Event in accordance with Code
  § 409A.

            

    

     

    
      	
              34253.000052
      RICHMOND 1368524v14ex1017.htm

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    Exhibit 10.17

    CSX
Omnibus Incentive Plan

    Effective
May 3, 2006

    (As
Amended through December 12, 2007)

     

    
      	
              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)  

            	
              Board”
      means the Board of Directors of CSX
Corporation.

            

    

     

    
      	
              (e)  

            	
              “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.

            

    

     

    
      	
              (f)  

            	
              “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 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(f);
  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 such date 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 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(f); or

            

    

     

    
      	
              (v)  

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

            

    

     

    
      	
              (g)  

            	
              “Code”
      means the Internal Revenue Code of 1986, as
  amended.

            

    

     

    
      	
              (h)  

            	
              “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.

            

    

     

    
      	
              (i)  

            	
              “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.

            

    

     

    
      	
              (j)  

            	
              “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.

            

    

     

    
      	
              (k)  

            	
              “CSX”
      means CSX Corporation.

            

    

     

    
      	
              (l)  

            	
              “Date
      of Grant” means the date on which the Committee grants an Incentive
      Award.

            

    

     

    
      	
              (m)  

            	
              “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.

            

    

     

    
      	
              (n)  

            	
              “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.

            

    

     

    
      	
              (o)  

            	
              “Employer”
      means CSX and each Subsidiary, Foreign Affiliate or Affiliate that employs
      one or more Participants.

            

    

     

    
      	
              (p)  

            	
              “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.

            

    

     

    
      	
              (q)  

            	
              “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.

            

    

     

    
      	
              (r)  

            	
              “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.

            

    

     

    
      	
              (s)  

            	
              “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.

            

    

     

    
      	
              (t)  

            	
              “Incentive
      Stock Option” means an Option that qualifies for favorable federal income
      tax treatment under Code Section
422.

            

    

     

    
      	
              (u)  

            	
              “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.

            

    

     

    
      	
              (v)  

            	
              “Nonqualified
      Stock Option” means an Option that is not an Incentive Stock
      Option.

            

    

     

    
      	
              (w)  

            	
              “Option”
      means a right to purchase Company Stock granted under the Plan, at a price
      determined in accordance with the
Plan.

            

    

     

    
      	
              (x)  

            	
              “Participant”
      means any employee of CSX, a Subsidiary, a Foreign Affiliate or an
      Affiliate who receives an Incentive Award under the
  Plan.

            

    

     

    
      	
              (y)  

            	
              “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 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.

     

    
      	
              (z)  

            	
              “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.

            

    

     

    
      	
              (aa)  

            	
              “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.

            

    

     

    
      	
              (bb)  

            	
              “Restricted
      Stock” means Company Stock awarded under Section
  6.

            

    

     

    
      	
              (cc)  

            	
              “Restricted
      Stock Unit” means a right granted to a Participant to receive Company
      Stock or cash awarded under Section
7.

            

    

     

    
      	
              (dd)  

            	
              “Retirement”
      means attainment of retirement under the CSX Pension Plan or Special
      Retirement Plan for CSX Corp. and Affiliated Corporations (nonqualified
      retirement plan) and immediately commencing your retirement
      benefits.

            

    

     

    
      	
              (ee)  

            	
              “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.

            

    

     

    
      	
              (ff)  

            	
              “Senior
      Executive Incentive Award” means an award made to a Participant under the
      terms of the Senior Executive Incentive
Plan.

            

    

     

    
      	
              (gg)  

            	
              “Senior
      Executive Incentive Plan” means the CSX Senior Executive Incentive
      Plan.

            

    

     

    
      	
              (hh)  

            	
              “Stock
      Appreciation Right” means a right to receive amounts awarded under Section
      10.

            

    

     

    
      	
              (ii)  

            	
              “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.

            

    

     

    
      	
              (jj)  

            	
              “Vesting
      Event” means the occurrence of any event listed in Section 2(f), with the
      following modification:  the words, “Approval by the
      shareholders of CSX of,” in the first line of Sections 2(f)(iii) and
      2(f)(iv) are replaced for purposes of this Section 2(jj) 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 ,”.

            

    

     

    
      	
              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.

            

    

     

    
      	
              (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.

            

    

     

    
      	
              (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:

            

    

     

    
      	
              (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 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.  Effective January 1, 2005, the Committee may
      permit Participants to elect to defer any gains realized or the issuance
      or right to Company Stock relating to Incentive Awards, other than Options
      or Stock Appreciation Rights, vested, earned or granted after December 31,
      2004, under the CSX Executives’ Deferred Compensation Plan or any
      successor plan.

            

    

     

    
      	
              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.  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.

            

    

     

    
      	
              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 CSR’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.

            

    

     

    
      	
              (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 $100,000 on
      the Date of Grant.

            

    

     

    
      	
              (d)  

            	
              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.

            

    

     

    
      	
              (e)  

            	
              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.

            

    

     

    
      	
              (f)  

            	
              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.

            

    

     

    
      	
              (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.  If no Beneficiary is designated and the
      Participant dies testate, any outstanding Incentive Awards that are
      otherwise exercisable may be exercised by the person to whom such rights
      under an Incentive Award or such Incentive Awards are specifically
      bequeathed, or if there is no such specific bequest, by the personal
      representative of the Participant’s estate.  If no Beneficiary
      is designated and the Participant dies intestate, any outstanding
      Incentive Award that is otherwise exercisable may be exercised by the
      persons to whom such rights pass under the laws of descent and
      distribution of the state in which the Participant was domiciled at his or
      her death.

            

    

     

    
      	
              20.  

            	
              Change in
      Control.

            

    

     

    
      	
              (a)  

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

            

    

     

    
      	
              (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 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 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(f)(iii) or 2(f)(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(f)(iii) or
      2(f)(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 if 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(f)(iii) or 2(f)(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(f)(iii) or 2(f)(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

            

    

     

    
      	
              (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(f)(iii) or 2(f)(iv) and prior to a 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(f)(iii) or 2(f)(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.

            

    

     

    
      	
              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.

            

    

     

    

    
      	
              34253.000052
      RICHMOND 1218135v4

            

    

    

     

    
      
        
          --

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