Document:

Exhibit

Exhibit 10.5

KANSAS CITY SOUTHERN
EXECUTIVE PLAN

(AS AMENDED AND RESTATED JANUARY 23, 2018)

THIS AMENDED AND RESTATED EXECUTIVE PLAN is executed the day and year hereinafter provided by Kansas City Southern, a corporation organized under the laws of the State of Delaware (“KCS”).

WITNESSETH:

WHEREAS, KCS established on January 18, 1985, the Kansas City Southern Industries, Inc. ERISA Excess Benefits Plan for the purpose of providing additional benefits to certain executives; and

WHEREAS, KCS has amended said plan from time to time and most recently amended and restated the plan as the Kansas City Southern Executive Plan effective February 18, 2015; and 

WHEREAS, KCS reserved the power to amend said plan and wishes to exercise that power to amend and restate said plan again as hereinafter provided.

NOW, THEREFORE, KCS hereby amends and restates said plan as the Kansas City Southern Executive Plan (As Amended and Restated January 23, 2018) as set forth herein.

Article 1.  Definitions
1.1    “Annual Benefit” shall mean the benefit, if any, determined under the Plan with respect to each calendar year.

1.2    “Annual Benefit Amount” shall mean the amount of a Participant’s Annual Benefit, which, subject to the other provisions of this Plan, shall be a dollar amount equal to 10% of the excess (if any) of (a) the Participant’s Compensation, over (b) the maximum dollar amount of annual 

compensation that can be taken into account for purposes of determining a participant’s benefit under a qualified retirement plan as set forth under Section 401(a)(17) of the Code.  If the amount determined under (b) of this Section 1.2 equals or exceeds the Participant’s Compensation with respect to a calendar year, then the Participant will not receive an Annual Benefit under this Plan with respect to such calendar year.  

1.3    “Award Agreement” shall mean a Restricted Shares Award Agreement providing an award issued under the KCS 2017 EIP of Restricted Shares representing the Participant’s Annual Benefit for a year.

1.4    “Code” shall mean the Internal Revenue Code of 1986, as from time to time amended.
1.5    “Compensation” shall mean the amount equal to the greater of (a) the aggregate of a Participant’s annual base salary for the applicable calendar year plus the Participant’s compensation earned under the Company’s short-term incentive plan for such year which may be paid in the following year or (b) an amount equal to 145% (or such other percentage as set forth in the Participant’s employment agreement) of the Participant’s annual base salary for the applicable calendar year.

1.6    “Company” shall mean the employer of a Participant, and shall include only KCS and each subsidiary company of KCS that is at least eighty percent (80%) owned by KCS, and that has been admitted to participate in the Plan upon approval of the Compensation and Organization Committee.

1.7    “Compensation and Organization Committee” shall mean the Compensation and Organization Committee of the Board of Directors of KCS.

1.8    “Grant Date” shall mean the date the Annual Benefit is paid or, in the case of the issuance of Restricted Shares, the date of grant of such Restricted Shares, as provided in Section 3.2.

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1.9    “KCS” shall mean Kansas City Southern, a corporation organized under the laws of the State of Delaware, or any successor entity.  

1.10    “KCS 2017 EIP” shall mean the Kansas City Southern 2017 Equity Incentive Plan, as may be amended or replaced from time to time.

1.11    “Participant” shall mean an employee of a Company who is eligible to participate in the Plan under Article 2. 

1.12    “Plan” shall mean the Kansas City Southern Executive Plan (As Amended and Restated January 23, 2018), as set forth herein and as may be amended from time to time.  

1.13    “Restricted Shares” shall mean shares of common stock of KCS that constitute restricted shares within the meaning of the KCS 2017 EIP that are awarded to the Participant under the KCS 2017 EIP based upon the Participant’s qualification for an Annual Benefit under this Plan.  An Award Agreement for Restricted Shares shall contain such terms and conditions as determined by the Compensation and Organization Committee pursuant to its authority under the KCS 2017 EIP.

Article 2.  Eligibility
Eligibility to participate in this Plan shall be limited to any executive of the Company who is designated by the President or Chief Executive Officer of the Company or by the Compensation and Organization Committee as a Participant in this Plan. 

Article 3.  Benefits
3.1    Method of Payment of Annual Benefit.  Each Participant’s Annual Benefit, if any, shall be paid in the form of Restricted Shares unless payment is made in cash under the provisions of Section 3.5.  If the Participant’s Annual Benefit is paid in the form of Restricted Shares, then the Participant will receive an award of Restricted Shares under the KCS 2017 EIP.  The Participant’s 

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award of Restricted Shares will be subject to the terms and conditions of the Award Agreement which shall be consistent with the provisions of this Plan.  
3.2    Time of Payment of Annual Benefit.  A Participant’s Annual Benefit, if any, for a calendar year will be paid during the first 2 1/2 months of the calendar year following the calendar year for which the Annual Benefit is earned.  
3.3    Number of Restricted Shares.  The number of Restricted Shares awarded in payment of a Participant’s Annual Benefit shall be such number so that the total value of the Restricted Shares awarded as determined on the Grant Date is equal to 125% (or such greater percentage as the Compensation and Organization Committee may determine, which percentage may vary from year to year) of the Participant’s Annual Benefit Amount.  The value of each Restricted Share for this purpose shall be determined on the Grant Date and shall be equal to the Fair Market Value (as such term is defined under the KCS 2017 EIP) of one KCS common share.  If the number of Restricted Shares determined under the preceding sentences would include a fractional share, then such fractional share shall be rounded up to the nearest whole share. 
3.5    Active Employee Requirement for Award of Restricted Shares; Cash Payment.  If a Participant is not an active employee of a Company on the Grant Date determined by the Committee under Section 3.2 with respect to an Annual Benefit, then the Participant’s Annual Benefit, if any, payable on such Grant Date shall be paid in the form of cash rather than as an award of Restricted Shares.  The amount of any such cash payment will equal the Annual Benefit Amount of such Annual Benefit.  
3.6    Discretion of Compensation and Organization Committee to Cancel Annual Benefit.  Notwithstanding any other provisions of this Plan, the Compensation and Organization Committee may, in its sole discretion, prior to the payment of a Participant’s Annual Benefit with respect to a calendar year, cancel the Participant’s Annual Benefit for such calendar year so that the Participant will receive no Annual Benefit under this Plan for such calendar year.   

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Article 4.  Additional Provisions
4.1    No Trust.  Nothing contained in this Plan and no action taken pursuant to the provisions of this Plan shall create or be construed to create a trust of any kind or a fiduciary relationship between any Company and a Participant or any other person.

4.2    Source of Payments.  Each Participant, and any other person or persons having or claiming a right to benefits hereunder or to any interest in the Plan through such Participant, shall rely solely on the unsecured promise of the Company as set forth herein and nothing in the Plan shall be construed to give the Participant or any other person or persons any right, title, interest or claim in or to any specific asset, fund, reserve, account or property of any kind whatsoever owned by any Company or in which any Company has any right, title or interest now or in the future, but such Participant shall have the right to enforce his claim against the Company employing such Participant in the same manner as any unsecured creditor.

4.3    No Assignment.  The right of a Participant or any other person to the payment of benefits under this Plan shall not be assigned, transferred, pledged or encumbered in any way.

4.4    Death.  If a Participant entitled to an Annual Benefit under this Plan should die prior to the payment of such benefit, then the Participant’s Annual Benefit will be paid in a cash payment determined under Section 3.5 to the beneficiary designated by the Participant under this Plan, if any, but if the Participant has not designated any beneficiary under this Plan then to the beneficiary designated by the Participant, if any, under the KCS 2017 EIP, but if the Participant has not designated any beneficiary under the KCS 2017 EIP, then to the Participant’s estate or to such person or persons entitled to receive the Participant’s estate as determined by the Compensation and Organization Committee.  Any such payment shall constitute a complete discharge of the liability of the Company with respect to such payment due under this Plan. 

4.5    Incapacity.  If the Compensation and Organization Committee shall find that any person to whom any payment is payable under this Plan is unable to care for his affairs because of illness or accident or is a minor, any payment due (unless a prior claim therefor shall have been 

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made by a duly appointed guardian, committee or other legal representative) may be paid to the spouse, a child, a parent or a brother or sister of such person, or to any person deemed by the Compensation and Organization Committee to have incurred expense for such person otherwise entitled to payment.  Any such payment shall constitute a complete discharge of the liability of the Company with respect to any payment due under this Plan.  

4.6.    Compensation and Organization Committee Powers and Liabilities.  The Compensation and Organization Committee in its absolute discretion shall have the full power and authority to interpret, construe and administer this Plan and the Compensation and Organization Committee’s interpretations and construction thereof, and action thereunder, including the determination of the amount or recipient of the payment to be made therefrom, shall be binding and conclusive on all persons for all purposes.  No member of the Compensation and Organization Committee shall be liable to any person for any action taken or omitted in connection with the interpretation and administration of this Plan.

4.7    Benefits Not Treated as Compensation.  Any benefits payable under the Plan shall not be deemed salary or other compensation to the Participant for the purpose of computing benefits to which he may be entitled under any profit sharing plan, pension plan or any other arrangement of any Company for the benefit of its employees. 

4.8    Governing Law.  This Plan shall be construed in accordance with and governed by the law of the State of Delaware, excluding its choice of laws.

4.9    Merger.  Each Company agrees it will not be a party to any merger, consolidation or reorganization, unless and until its obligations hereunder shall be expressly assumed by its successor or successors.

4.10    Amendment.  This Plan may be amended at any time and from time to time by the Compensation and Organization Committee.

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4.11    Binding Effect.  This Plan shall be binding upon and inure to the benefit of each Company, its respective successors and assigns and the Participants and their heirs, executors, administrators and legal representatives.

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IN WITNESS WHEREOF, this amended and restated Plan has been duly executed this 23rd day of January, 2018.

KANSAS CITY SOUTHERN
By:     /s/ Patrick J. Ottensmeyer            
Name: Patrick J. Ottensmeyer
Title: President and CEO

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Exhibit 10.7

KANSAS CITY SOUTHERN ANNUAL INCENTIVE PLAN
(As Amended and Restated Effective November 9, 2018)

1.    PURPOSE.  The purpose of the Plan is to provide Eligible Employees of the Employer with annual incentive compensation based on the level of achievement of financial and other performance criteria.  The Plan is intended to focus the interests of these employees on the key measures of the Company's success and to reward these employees for the Company’s achievement of those key measures of the Company's success.  
2.    DEFINITIONS.  As used in the Plan, the following terms shall have the meanings set forth below:
(a)    “Award” shall mean the right to receive a cash payment for a Performance Year payable to a Participant on account of his or her participation in the Plan and achievement of the applicable Performance Goal(s).  
(b)    “Board” shall mean the Board of Directors of the Company.
(c)    “Code” shall mean the Internal Revenue Code of 1986, as amended from time to time, including applicable regulations and rulings thereunder and any successor provisions thereto.
(d)    “Committee” shall mean the Compensation and Organization Committee of the Board (or any successor committee).
(e)    “Company” shall mean Kansas City Southern, and any successor thereto which adopts the Plan.
(f)    “Disability” shall mean a disability as determined under the Employer’s applicable long-term disability program.
(g)    “Eligible Earnings” shall include base earnings and certain pay differentials for time worked in an eligible position during the Performance Year.  
(h)    “Eligible Employee” shall mean an individual who is employed by the Employer who is not represented by a union or other collective bargaining organization.
(i)    “Employer” shall mean the Company and any affiliate of the Company that elects to participate and be an Employer under the Plan with the consent of the Company.
(j)    “Maximum Award” shall mean an Award amount that may be paid if the maximum level of the Performance Goal(s) is achieved in the Performance Year.
(k)    “Participant” shall mean, with respect to any Performance Year, any Eligible Employee who is selected to participate in the Plan in accordance with Section 3 of the Plan.
(l)    “Performance Goal” shall mean the pre-established performance goal(s) established under the Plan for each Performance Year as described in Section 4 of the Plan.
(m)    “Performance Measures” shall mean any criteria on which Performance Goals may be based as determined by the Committee in its discretion, including but not limited to any of the following:      
		
	(i)
	Earnings (either in the aggregate or on a per-share basis); 

		
	(ii)
	Net income (before or after taxes); 

		
	(iii)
	Operating income;

		
	(iv)
	Cash flow;

		
	(v)
	Return measures (including return on assets, equity, or sales); 

		
	(vi)
	Earnings before or after any, or any combination of, taxes, interest or depreciation and amortization; 

		
	(vii)
	Gross revenues; 

		
	(viii)
	Share price (including growth measures and stockholder return or attainment by the Company's common stock of a specified value for a specified period of time); 

		
	(ix)
	Reductions in expense levels in each case, where applicable, determined either on a Company-wide basis or in respect of any one or more business units; 

		
	(x)
	Net economic value; 

		
	(xi)
	Market share;

		
	(xii)
	Operating profit;

		
	(xiii)
	Costs; 

		
	(xiv)
	Operating and maintenance cost management and employee productivity; 

		
	(xv)
	Stockholder returns (including return on assets, investments, equity, or gross sales); 

		
	(xvi)
	Economic value added;

		
	(xvii)
	Aggregate product unit and pricing targets;

		
	(xviii)
	Strategic business criteria, consisting of one or more objectives based on meeting specified revenue, market share, market penetration, geographic business expansion goals, objectively identified project milestones, production volume levels, cost targets, and goals relating to acquisitions or divestitures;

		
	(xix)
	Achievement of business or operational goals such as market share and/or business development;

		
	(xx)
	Results of customer satisfaction surveys;

		
	(xxi)
	Safety record;

		
	(xxii)
	Network and service reliability; 

		
	(xxiii)
	Debt ratings, debt leverage and debt service; and/or

		
	(xxiv)
	Operating ratio.

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(n)    “Performance Year” shall mean the calendar year of the Company.
(o)    “Plan” shall mean the Kansas City Southern Annual Incentive Plan, as set forth herein, as from time to time amended.
(p)    “Retirement” shall mean an Eligible Employee’s separation of employment from the Company with an immediate eligibility to receive a retirement annuity per the provisions of the Railroad Retirement Board.
(q)    “Target Award” shall mean the amount eligible to be paid under an Award if the target Performance Goal(s) is achieved in the Performance Year.
(r)    “Threshold Award” shall mean the amount eligible to be paid under an Award if the threshold Performance Goal(s) is achieved in the Performance Year.    
3.    ELIGIBILITY and PARTICIPATION.  A Participant must be employed by the Employer on the last business day of the Performance Year in order to be eligible to receive payment under an Award, except in the cases of Retirement or Disability. In the case of death, if an Eligible Employee dies before the last business day of the Performance Year, the Participant is eligible to receive payment under an Award unless the Participant is eligible for a Profit Sharing Adjustment in accordance with Section 4(d), in which case only the Profit Sharing Adjustment will be paid.   
4.    ESTABLISHMENT AND DETERMINATION OF AWARDS.
(a)    Establishment of Performance Goal(s).  After recommendations from senior management of the Company based on consultation with third party sources, the Committee shall establish objective threshold, target, and maximum Performance Goal(s) for each Award after the beginning of each Performance Year, and shall also establish any other bonus payment amounts at other levels of performance. The Performance Goals may be based upon the performance of the Company, the Employer, or any operating unit level, division or function thereof, and may be applied either alone or relative to the performance of other businesses or individuals (including industry or general market indices), based on one or more of the Performance Measures.  All Performance Goals may be expressed as whole dollar amounts, percentages or growth rates.  
With respect to any or all Performance Goal(s) applicable to a Participant, the Company shall also establish, subject to the approval of the Committee, the Threshold Award, Target Award, and Maximum Award payable to the Participant if such Performance Goal(s) is achieved.  Threshold Awards, Target Awards, and Maximum Awards will be expressed as a percentage of a Participant’s Eligible Earnings and correspond to the Participant’s designated Award level unless otherwise determined by the Committee. 
(b)    Payment of Awards.  Unless otherwise determined by the Committee, the payment of any Award shall be subject to achievement of the applicable Performance Goal(s) and the degree to which each of the Performance Goals have been attained.  If a Participant’s Target Award level changes during a Performance Year, the amount of the Participant’s Award will be computed in proportion to his or her Award level that applied to such Participant each day during such Performance Year.    

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(c)    Adjustments to Awards.  The Committee may, in its discretion, modify (including by increasing or reducing) the amount of any Award based on such criteria as it shall determine, including, but not limited to, financial results, individual performance, safety performance, business unit and site accomplishments, and other factors tied to the success of the Company or any of its business units.  There is no obligation of uniformity of treatment of Participants under the Plan.
(d)    Profit Sharing Adjustment.  If, under statutory law, a Participant is entitled to a profit sharing payment from the Employer for a calendar year that coincides with a Performance Year, then the Award amount otherwise payable to the Participant hereunder shall be reduced by an amount equal to such statutory profit sharing amount payable to the Participant.  If applicable, for purposes of calculating such reduction, the statutory profit sharing amount shall be converted to U.S. dollars in accordance with procedures established hereunder. 
5.    PAYMENT OF AWARDS.
(a)    Time of Payment.  An Award shall be paid to a Participant in cash after the Committee has determined that the Performance Goal(s) for the Performance Year have been achieved but in no event later than the 15th day of the third month following the end of such Performance Year.  Notwithstanding the foregoing, an Award with respect to a Performance Year to be paid to a Participant that is not subject to income taxation under the laws of the United States, may be paid later than the 15th day of the third month following the end of such Performance Year, but shall not in any event be paid later than the 30th day of the fourth month following the end of such Performance Year.  Awards payable to other Participants who have had a termination of employment on account of Retirement, death, Disability, or other special circumstance determined appropriate by the Committee during the Performance Year shall be payable in accordance with Section 4(b) of the Plan and at the same time other Participants receive Awards under the Plan.  If the Participant dies prior to receiving payment of an Award, any Award payable under the Plan to such Participant shall be paid to the Participant’s surviving spouse (if married) or estate (if unmarried).
(b)    Withholding.  Awards are subject to withholding for applicable federal, state and local taxes.
6.    PLAN ADMINISTRATION.
(a)    Administration.  The Plan shall be administered by the Committee.  The Committee shall have full discretionary authority to establish the rules and regulations relating to the Plan, to interpret the Plan and those rules and regulations, to determine the Awards and the Performance Measures applicable to each Award, to approve all Awards, to decide the facts in any case arising under the Plan, and to make all other determinations and to take all other actions necessary or appropriate for the proper administration of the Plan.  In making any determinations under or referred to in the Plan, the Committee shall be entitled to rely on opinions, reports or statements of employees of the Company and of counsel, public accountants, and other professional or expert persons.  The Committee’s administration of the Plan, including all such rules and regulations, interpretations, selections, determinations, approvals, decisions, delegations, amendments, terminations and other actions, shall be final and binding on the Company and its stockholders and all employees, including Participants and their beneficiaries.  No member of the Committee shall be liable for any action taken or determination made in good faith with respect to the Plan or any Award.

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(b)    Delegation.  Except to the extent prohibited by applicable law or the applicable rules of a stock exchange, the Committee may allocate all or any portion of its responsibilities and powers to any one or more of its members, and may delegate all or any part of its responsibilities and powers for administering the Plan to one or more persons as the Committee deems appropriate, and at any time may revoke any such allocation or delegation. 
7.    AMENDMENT OR TERMINATION OF PLAN.  The Committee may amend (in whole or in part) or terminate the Plan at any time, effective at such date as the Committee may determine.  The Company also may amend (in whole or in part) or terminate the Plan at any time effective as of such date as the Company may determine, provided, however, any such amendment of the Plan by the Company is subject to the approval of the Committee.
8.    MISCELLANEOUS PROVISIONS.
(a)    Awards Not Transferable.  A Participant’s right and interest under the Plan may not be assigned or transferred.  Any attempted assignment or transfer shall be null and void and shall extinguish, in the Committee’s sole discretion, the Company’s obligation under the Plan to pay Awards with respect to the Participant.
(b)    Effect of Awards on Other Compensation.
1)    Awards shall not be considered eligible pay under other plans, benefit arrangements or fringe benefit arrangements of the Company, unless otherwise provided under the terms of other plans.
2)    To the extent provided in the applicable benefit plan or benefit arrangement of an Employer, amounts payable as Awards will be reduced in accordance with the Participant’s compensation reduction election, if any, in effect under other plans at the time the Award is paid.
(c)    No Employment Rights.  This Plan is not a contract between the Employer and any employee or Participant.  Neither the Plan, nor any action taken hereunder, shall be construed as giving to any Participant the right to be retained in the employ of the Employer.  Nothing in the Plan shall limit or affect in any manner or degree the normal and usual powers of management, exercised by the officers and the Board or any committee of the Board, to change the duties or the character of employment of any employee or to remove an individual from the employment of the Employer at any time, all of which rights and powers are expressly reserved.
(d)    Unfunded Plan.  The Plan shall be unfunded.  No Employer shall be required to establish any special or separate fund, or to make any other segregation of assets, to assure payment of Awards.  Awards shall be paid solely from the general assets of the Participant’s Employer, to the extent the payments are attributable to services for the Employer.  To the extent any person acquires a right to receive payments from an Employer under the Plan, the right is no greater than the right of any other unsecured general creditor.
(e)    Payment in Shares of Company Common Stock.  Notwithstanding any provision in this Plan to the contrary, the Committee may direct that payment of an Award be made in shares of the Company's common stock, in lieu of cash, in accordance with any executive stock ownership 

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guidelines adopted by the Committee.  Any such Award paid in shares of the Company's common stock shall be made pursuant to and in accordance with the Kansas City Southern 2017 Equity Incentive Plan (or any successor plan). 
(f)    Deferral Under Executive Deferred Compensation Plan.  Notwithstanding any payment timing provision described in this Plan, to the extent an Eligible Employee is eligible to participate in the Kansas City Southern Executive Deferred Compensation Plan, Award payments under this Plan may be deferred in accordance with the Executive Deferred Compensation Plan and an Eligible Employee's eligibility to defer incentive bonuses under this Plan. 
(g)    Applicable Law.  The Plan shall be governed by the laws of the State of Missouri and applicable federal law.

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