Document:

<PAGE>

                                                                    EXHIBIT 10.1

                    AMENDMENT NO. 5 TO TRANSACTION AGREEMENT

      THIS AMENDMENT NO. 5 to the Transaction Agreement (this "Amendment") is
made as of August 27, 2004 by and among CSX CORPORATION, a Virginia corporation
("CSX"), CSX TRANSPORTATION, INC., a Virginia corporation, for itself and on
behalf of its controlled Subsidiaries (collectively, "CSXT"), NORFOLK SOUTHERN
CORPORATION, a Virginia corporation ("NSC"), NORFOLK SOUTHERN RAILWAY COMPANY, a
Virginia corporation, for itself and on behalf of its controlled Subsidiaries
(collectively, "NSR"), CONRAIL INC., a Pennsylvania corporation, for itself and
on behalf of its controlled Subsidiaries (collectively, "CRR"), CONSOLIDATED
RAIL CORPORATION, a Pennsylvania corporation ("CRC"), and CRR HOLDINGS LLC, a
Delaware limited liability company ("CRR Parent"). CSX, CSXT, NSC, NSR, CRR, CRC
and CRR Parent are sometimes individually referred to herein as a "Party" and
collectively as the "Parties."

      WHEREAS, the Parties have previously entered into that certain Transaction
Agreement, dated as of June 10, 1997, as amended by Amendment No. 1 to
Transaction Agreement, dated as of August 22, 1998; Amendment No. 2 to
Transaction Agreement, dated as of June 1, 1999; Amendment No. 3 to Transaction
Agreement, which is also referred to as the Environmental Amendment, dated as of
June 1, 1999; and Amendment No. 4 to Transaction Agreement, previously referred
to as Amendment No. 3, pertaining to the size of the CRC Board, dated as of
August 1, 2000 (the "Transaction Agreement"); and the Ancillary Agreements (as
defined in the Transaction Agreement) related thereto;

      WHEREAS, the Parties, CSX RAIL HOLDING CORPORATION, a Delaware corporation
("CSX Rail"), CSX NORTHEAST HOLDING CORPORATION, a Delaware corporation ("CSX
Northeast"), NEW YORK CENTRAL LINES LLC, a Delaware limited liability company
and a wholly-owned Subsidiary of CRC ("NYC"), PENNSYLVANIA LINES LLC, a Delaware
limited liability company and wholly-owned Subsidiary of CRC ("PRR"), GREEN
ACQUISITION CORP., a Pennsylvania corporation and a wholly-owned Subsidiary of
CRR Parent ("Green Acquisition"), NYC Newco, Inc., a Virginia corporation and
wholly-owned Subsidiary of CSXT ("NYC Newco"), and PRR Newco, Inc., a Virginia
corporation and wholly-owned Subsidiary of NSR ("PRR Newco"), are the parties to
that certain Distribution Agreement, dated as of July 26, 2004 (the
"Distribution Agreement");

      WHEREAS, the parties to the Distribution Agreement are on the date hereof
consummating the Closing (as defined in the Distribution Agreement) and entering
into various documents and instruments to effectuate the same;

      WHEREAS, in connection with the Parties' preparations for the Closing and
as required under the terms of the Distribution Agreement, the Parties have
identified certain provisions of the Transaction Agreement and the Ancillary
Agreements for which the Parties desire to clarify their understandings and
agreements with respect to certain matters related to the Transaction Agreement
and the Ancillary Agreements in order to effectuate the Distribution Agreement;

<PAGE>

      WHEREAS, the Parties have determined that it is in the best interests of
their respective companies to amend the Transaction Agreement and the Ancillary
Agreements as set forth in this Amendment; and

      WHEREAS, it is the intent of the Parties that, except as expressly amended
hereby, the Transaction Agreement and the Ancillary Agreements as in effect
immediately prior to the execution and delivery of this Amendment shall remain
in full force and effect;

      NOW, THEREFORE, the Parties hereby amend the Transaction Agreement and the
Ancillary Agreements as follows:

1.    References; Interpretation.

      Unless otherwise specifically defined herein, each term used herein which
      is defined in the Transaction Agreement has the meaning assigned to such
      term in the Transaction Agreement. Each reference in the Transaction
      Agreement, as now in effect, to "hereof," "hereunder," "herein," "hereby"
      or words of similar import and each reference to "this Agreement" and each
      other similar reference contained in the Transaction Agreement, or in
      Ancillary Agreements, as now in effect, shall from and after the date of
      this Amendment refer to the Transaction Agreement as amended hereby.

      Nothing contained in the reaffirmations in this Amendment shall prejudice
      or otherwise affect the position of any Party hereto in any dispute as to
      interpretation of the Transaction Agreement or any Ancillary Agreement.

2.    Integration. The Parties to the Transaction Agreement which execute this
      Amendment hereby reaffirm the Transaction Agreement and the Ancillary
      Agreements referred to therein so that the Transaction Agreement and the
      Ancillary Agreements, each as presently in effect, and the conforming
      changes set forth in Schedule A to this Amendment and contemplated by
      Section 5 of this Agreement shall be read as integrated documents from and
      after the Distribution Date (as defined in the Distribution Agreement).

3.    No Changes to Shared Assets. Notwithstanding any provision of this
      Amendment, or of Schedule A hereto, or any action taken in connection with
      the transactions contemplated by the Distribution Agreement or by this
      Amendment, no changes, modifications or amendments to the North Jersey,
      South Jersey/Philadelphia, or Detroit Shared Assets Operating Agreements,
      or to those Shared Assets Areas, are being made by this Amendment, any
      Schedule hereto or those transactions, and none shall be implied.

4.    Reaffirmation. Except as specifically amended as set forth in this
      Amendment or the instruments or documents provided for herein including
      Schedule A hereto, all other terms and provisions of the Transaction
      Agreement and the Ancillary Agreements, as now in effect, subject to the
      conforming changes provided for herein or set forth in Schedule A hereto,
      shall continue in full force and effect and unchanged as now in effect and
      are hereby confirmed in all respects, including, without limitation, all
      of the Allocations of CRC lines, equipment and other property made in
      Article II, all of the trackage and other operating agreements referred to
      in Section 2.5 and listed in

                                      -2-

<PAGE>

      Schedule 4, all of the allocation and retentions of liabilities provided
      for in Section 2.8, the provisions of Section 4.3(a) with respect to the
      "keepwell" therein provided, and the Percentage allocation provided for in
      Section 4.3(b), in each case of the Transaction Agreement as now in
      effect.

5.    Required Modifications. In order to consummate the transactions
      contemplated in the Distribution Agreement, the Parties shall cooperate to
      modify the Transaction Agreement and the Schedules thereto and other
      agreements contemplated thereby, including without limitation, any
      Ancillary Agreements so as to permit the transfer of properties and other
      actions contemplated by the Distribution Agreement in order to reflect
      changes to rentals and the flow of funds resulting from the restructuring
      of debt obligations in accordance with the terms and subject to the
      conditions of the Distribution Agreement, all in accordance with the
      Percentage principles contained in the Transaction Agreement.

6.    Miscellaneous. The provisions of Article XI of the Transaction Agreement
      are hereby expressly incorporated by reference into this Amendment, and
      each provision thereof shall have the same force and effect as if fully
      set forth herein (except to the extent such provision is amended,
      modified, supplemented, altered, rescinded or superseded by this
      Amendment).

                                 * * * * * * * *

                                      -3-

<PAGE>

      IN WITNESS WHEREOF, the Parties hereto have caused this Amendment to be
duly executed as of the date and year first above written.

                              CSX CORPORATION

                              By:   /s/ Peter J. Shudtz
                                  ----------------------------------------------
                                  Name: Peter J. Shudtz
                                  Title: VP - Regulatory Affairs & Washington
                                         Counsel

                              CSX TRANSPORTATION, INC., for itself and on behalf
                              of its controlled Subsidiaries

                              By:   /s/ Peter J. Shudtz
                                  ----------------------------------------------
                                  Name: Peter J. Shudtz
                                  Title: Authorized Signatory

                              NORFOLK SOUTHERN CORPORATION

                              By:   /s/ William J. Romig
                                 -----------------------------------------------
                                  Name: William J. Romig
                                  Title: Vice President and Treasurer

                              NORFOLK SOUTHERN RAILWAY COMPANY, for itself and
                              on behalf of its controlled Subsidiaries

                              By:   /s/ William J. Romig
                                  ----------------------------------------------
                                  Name: William J. Romig
                                  Title: Vice President and Treasurer

                  [Signature Page to Amendment No. 5]

<PAGE>

                              CONRAIL INC., for itself and on behalf of its
                              controlled Subsidiaries

                              By:   /s/ Joseph W. Rogers
                                  -----------------------------
                                  Name:  Joseph W. Rogers
                                  Title: Assistant Treasurer

                              CONSOLIDATED RAIL CORPORATION

                              By:   /s/ Joseph W. Rogers
                                  -----------------------------
                                  Name: Joseph W. Rogers
                                  Title: Chief Financial Officer & Corporate
                                         Treasurer

                              CRR HOLDINGS LLC

                              By:   /s/ Peter J. Shudtz
                                  -----------------------------
                                  Name: Peter J. Shudtz
                                  Title: VP

                      [Signature Page to Amendment No. 5]

<PAGE>

                                                                      SCHEDULE A

                        AMENDMENTS AND CONFORMING CHANGES

1.    Transaction Agreement Amendments.

      1.1   Section 1.1 of the Transaction Agreement is hereby amended by
            inserting the following definition:

                  "Distribution Agreement" means the Agreement of that name
            dated as of July 26, 2004, by and among CSX Corporation, CSX
            Transportation, Inc., CSX Rail Holding Corporation, CSX Northeast
            Holding Corporation, New York Central Lines LLC, Norfolk Southern
            Corporation, Norfolk Southern Railway Company, Pennsylvania Lines
            LLC, Conrail Inc., Consolidated Rail Corporation, CRR Holdings LLC,
            Green Acquisition Corp., NYC Newco, Inc. and PRR Newco, Inc.

      1.2   Section 4.5 of the Transaction Agreement is hereby amended to read
            in its entirety as set forth below:

            (a)   Historically, Section 4.5 read as follows:

                  "The parties anticipate that as of the Closing Date, the sum
                  of the following amounts will total seven hundred and fifty
                  million dollars: (i) Interest Rentals payable under the Shared
                  Assets Agreements, (ii) Operating Fees payable under the CSXT
                  Operating Agreement and the NSR Operating Agreement and (iii)
                  Base Rent payable under the CSXT Equipment Agreement and the
                  NSR Equipment Agreement. The parties acknowledge that as of a
                  Valuation Date, (i) the Interest Rentals, Operating Fees and
                  Base Rent shall be determined as set forth in the CSXT
                  Operating Agreement, the NSR Operating Agreement, the CSXT
                  Equipment Agreement, the NSR Equipment Agreement and the
                  Shared Assets Agreements and (ii) the allocation between CSXT
                  and NSR of the Operating Fees and Base Rent payable under the
                  CSXT Operating Agreement, the NSR Operating Agreement, the
                  CSXT Equipment Agreement and the NSR Equipment Agreement shall
                  reflect the then relative Fair Market Rental Values of the NYC
                  Allocated Assets, the PRR Allocated Assets, the CSXT Equipment
                  and the NSR Equipment as of the most recent Valuation Date
                  (which allocation, in the case of a Valuation Date that is
                  also the Closing Date, shall be a 58% allocation to NSR and a
                  42% allocation to CSXT)."

            (b)   As a consequence of the transactions contemplated by the
                  Distribution Agreement, the rentals provided for under
                  paragraph (a) above will change as follows: (i) NSR and CSXT
                  shall no

                                    SCH. A-1

<PAGE>

                  longer pay rents under the NSR and CSXT Operating Agreements
                  and the NSR and CSXT Equipment Agreements and the parties
                  hereto shall take all actions necessary to terminate such
                  agreements, (ii) PRR Newco and NYC Newco (each as defined in
                  the Distribution Agreement) or their successors will pay rents
                  to CRC pursuant to certain Related Agreement Amendments
                  relating to the Equipment Obligation Agreements, as amended,
                  as defined in the Distribution Agreement, and (iii) NSR and
                  CSXT will continue to pay Interest Rentals to CRC under the
                  Shared Assets Agreements in accordance with Section 9(a)(i)
                  thereof. Notwithstanding anything to the contrary in the
                  Distribution Agreement or any other document or instrument
                  contemplated thereby, the costs and expenses set forth in
                  subpart (ii) (to the extent not specified in the Related
                  Agreement Amendments) and subpart (iii) above shall be borne
                  by CSXT and NSR in accordance with the Percentage. The parties
                  acknowledge and agree that (x) NSR and CSXT will be obligated
                  to the holders of CRC's unsecured debt pursuant to the New
                  Debentures (as defined in the Distribution Agreement) to the
                  extent such debt is tendered and accepted in the Exchange
                  Offer (as defined in the Distribution Agreement) and (y) CRC
                  shall continue to be obligated to the holders of CRC's
                  unsecured debt to the extent such debt is not tendered and
                  accepted in the Exchange Offer. The parties further
                  acknowledge and agree that, notwithstanding anything to the
                  contrary set forth in the Distribution Agreement or any other
                  document or instrument contemplated thereby, any category of
                  cost or expense which was borne by CSXT and NSR in accordance
                  with the Percentage prior to the Closing of the Transactions
                  contemplated thereby will continue to be borne in accordance
                  with the Percentage after the Closing of the Distribution
                  Agreement.

      1.3   Article V of the Transaction Agreement is hereby amended to read in
            its entirety as set forth below:

                  [Intentionally omitted.]

      1.4   The introductory paragraph of Part 1 to Schedule 2 of the
            Transaction Agreement is hereby amended to delete the words "(other
            than NYC and PRR)."

      1.5   Schedule 2 of the Transaction Agreement is hereby amended as
            follows:

            (i)   Paragraph (a) of Part 1 to Schedule 2 of the Transaction
                  Agreement is hereby amended to read in its entirety as set
                  forth below:

                  (a)   [Intentionally omitted.]

                                    SCH. A-2

<PAGE>

            (ii)  Paragraph (b) of Part 1 to Schedule 2 of the Transaction
                  Agreement is hereby amended to delete the words "(other than
                  NYC and PRR)."

            (iii) Paragraph (k) of Part 1 to Schedule 2 of the Transaction
                  Agreement is hereby amended to delete the following words:

                  "provided that in respect of Contracts that are Allocated
                  Assets, CRC shall follow NYC's (in the case of Contracts that
                  are NYC Allocated Assets) or PRR's (in the case of Contracts
                  that are PRR Allocated Assets) reasonable instructions in
                  respect of such Contracts and no CRC Board approval shall be
                  necessary for CRC to take such actions."

            (iv)  Paragraph (n) of Part 1 to Schedule 2 of the Transaction
                  Agreement is hereby amended to delete the words "(other than
                  NYC and PRR)."

            (v)   Paragraph (u) of Part 1 to Schedule 2 of the Transaction
                  Agreement is hereby amended to read in its entirety as set
                  forth below:

                  (u)   [Intentionally omitted.]

            (vi)  Part 2 to Schedule 2 of the Transaction Agreement is hereby
                  amended to read in its entirety as set forth below:

                  Except as approved by the CRC Board of Directors, neither CSX,
                  CSXT, NSC, nor NSR shall make, agree to make, or permit to be
                  made any transfer, easement, lease, license, sale of
                  improvements, trackage rights or operating rights or other
                  grant of the right to use any railroad line for railroad
                  service (other than to an entity controlling, controlled by,
                  or under common control with the grantor, such entity to be
                  thereafter bound by this provision) (regardless of whether the
                  grantor's rights depend on ownership or trackage rights or a
                  combination thereof) which is part of any Main Line until May
                  31, 2024, or thereafter for the duration of any renewal term
                  of the Shared Assets Operating Agreements for North Jersey and
                  South Jersey. Notwithstanding the foregoing or any contrary
                  provision herein, CSX, CSXT, NSC or NSR may make, agree to
                  make, or permit to be made, in their sole discretion, any
                  transfer, easement, lease, license, trackage rights, operating
                  rights, sale of improvements or other arrangement for rail
                  passenger service on any railroad line which is part of a Main
                  Line, so long as (A) such arrangement does not include
                  transferring fee ownership of such Main Line, and (B) CSX,
                  CSXT, NSC or NSR, as the case may be, retains the exclusive
                  right and obligation to

                                    SCH. A-3

<PAGE>

                  provide freight service on the railroad line for a term not
                  less than the term stated in the preceding sentence (including
                  any renewals) which is part of such Main Line. As used herein,
                  "Main Line" means a line of railroad held by NYC or PRR as of
                  the Distribution Date within the State of New Jersey or New
                  York, or the area within twenty-five miles of the City of
                  Philadelphia, PA, that has daily rail service, but does not
                  include any branch line connecting to a Main Line and does not
                  include the Main Line that lies east of the Hudson River and
                  south of Selkirk, NY.

2.    Ancillary Agreement Amendments and Other Agreement Amendments.

      2.1   The following agreements will amend or terminate certain Ancillary
            Agreements and other agreements:

            (i)   AMENDED AND RESTATED EQUIPMENT ALLOCATION AGREEMENT between
                  Consolidated Rail Corporation and New York Central Lines LLC,
                  amending and restating the Equipment Allocation Agreement
                  dated as of June 1, 1999, between the parties.

            (ii)  AMENDED AND RESTATED EQUIPMENT ALLOCATION AGREEMENT between
                  Consolidated Rail Corporation and Pennsylvania Lines LLC,
                  amending and restating the Equipment Allocation Agreement
                  dated as of June 1, 1999, between the parties.

            (iii) TERMINATION AGREEMENT between New York Central Lines LLC and
                  CSX Transportation, Inc., terminating the Equipment Agreement
                  dated as of June 1, 1999, between the parties.

            (iv)  TERMINATION AGREEMENT between Pennsylvania Lines LLC and
                  Norfolk Southern Railway Company, terminating the Equipment
                  Agreement dated as of June 1, 1999, between the parties.

            (v)   TERMINATION AGREEMENT between New York Central Lines LLC and
                  CSX Transportation, Inc., terminating the Operating Agreement
                  dated as of June 1, 1999, between the parties.

            (vi)  TERMINATION AGREEMENT between Pennsylvania Lines LLC and
                  Norfolk Southern Railway Company, terminating the Operating
                  Agreement dated as of June 1, 1999, between the parties.

            (vii) AMENDED AND RESTATED LEASE ADMINISTRATION AGREEMENT among
                  Consolidated Rail Corporation, CSX Corporation and Norfolk
                  Southern Corporation, amending the Lease Administration
                  Agreement dated as of June 1, 1999, among the parties.

                                    SCH. A-4<PAGE>

                                                                    EXHIBIT 10.2

                            TAX ALLOCATION AGREEMENT

                                  by and among

                             GREEN ACQUISITION CORP,

                                  CONRAIL INC.,

                         CONSOLIDATED RAIL CORPORATION,

                             PENNSYLVANIA LINES LLC,

                                       and

                           NEW YORK CENTRAL LINES LLC

                           Dated as of August 27, 2004

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                             Page
                                                                                                             ----
<S>                                                                                                          <C>
ARTICLE I   DEFINITIONS................................................................................       2

ARTICLE II  ALLOCATION OF INCOME TAXES AND OTHER TAXES.................................................       8
    Section 2.01.     Allocation of U.S. Federal Income Taxes..........................................       8
    Section 2.02.     Allocation of State and Local Income Taxes.......................................       8
    Section 2.03.     Allocation of Taxes Other Than Income Taxes......................................       9

ARTICLE III TAXES ATTRIBUTABLE TO THE CSX DISTRIBUTIONS AND THE NS DISTRIBUTIONS; ADDITIONAL RULINGS...       9
    Section 3.01.     Restrictions on Post-Distribution Actions........................................       9
    Section 3.02.     Allocation of Distribution Related Liability.....................................      10
    Section 3.03.     Special Representations..........................................................      11

ARTICLE IV  FILING OF INCOME TAX RETURNS; PAYMENT OF INCOME TAXES......................................      12
    Section 4.01.     Tax Returns for Pre-Distribution Periods.........................................      12
    Section 4.02.     Tax Returns for Post-Distribution Periods........................................      13
    Section 4.03.     Preparation of Returns...........................................................      13

ARTICLE V   TAX CONTESTS...............................................................................      14
    Section 5.01.     Notification, Participation and Consultation.....................................      14
    Section 5.02.     Pre-Distribution Periods.........................................................      15
    Section 5.03.     Post-Distribution Periods........................................................      15

ARTICLE VI  COOPERATION AND RECORD RETENTION...........................................................      16
    Section 6.01.     Cooperation......................................................................      16
    Section 6.02.     Record Retention.................................................................      16

ARTICLE VII MISCELLANEOUS MATTERS......................................................................      16
    Section 7.01.     Amendment and Waiver.............................................................      16
    Section 7.02.     Entire Agreement.................................................................      16
    Section 7.03.     Notices..........................................................................      16
    Section 7.04.     Dispute Resolution...............................................................      17
    Section 7.05.     Remedies.........................................................................      18
    Section 7.06.     Successors and Assigns...........................................................      18
    Section 7.07.     Severability; No Presumption Against Drafter.....................................      18
    Section 7.08.     Counterparts.....................................................................      18
    Section 7.09.     Descriptive Headings.............................................................      18
    Section 7.10.     No Third-Party Beneficiaries.....................................................      18
    Section 7.11.     Form of Payments and Late Payments...............................................      18
    Section 7.12.     Confidentiality..................................................................      18
    Section 7.13.     Governing Law....................................................................      19
</TABLE>

<PAGE>

                            TAX ALLOCATION AGREEMENT

      This Tax Allocation Agreement, dated as of August 27, 2004 (this
"AGREEMENT"), is entered into by and among Green Acquisition Corp., a
Pennsylvania corporation ("GREEN"), Conrail Inc., a Pennsylvania corporation
("CRR"), Consolidated Rail Corporation, a Pennsylvania corporation ("CRC"),
Pennsylvania Lines LLC, a Delaware limited liability company ("PRR") and New
York Central Lines LLC, a Delaware limited liability company ("NYC"); and,
solely for purposes of Articles III of this Agreement, CSX Corporation, a
Virginia corporation ("CSX") and Norfolk Southern Corporation, a Virginia
corporation ("NS").

                                    RECITALS

      A. WHEREAS, Green is the common parent of an affiliated group of
corporations (the "AFFILIATED GROUP"), as defined in Code (as defined herein)
Section 1504(a), filing a U.S. federal consolidated Income Tax Return (as such
terms are defined herein);

      B. WHEREAS, CRR is a wholly-owned Subsidiary of Green and CRC is a
wholly-owned Subsidiary of CRR;

      C. WHEREAS, PRR and NYC are limited liability companies that are
wholly-owned by CRC and are treated (i) as divisions of CRC for U.S. federal
Income Tax purposes and by some states and local governments for state and local
Tax purposes and (ii) as corporations by other states and local governments for
state and local Tax purposes;

      D. WHEREAS, CSX and certain of its Subsidiaries, NS and certain of its
Subsidiaries, and Green and certain of its Subsidiaries have entered into the
Distribution Agreement, dated as of July 26, 2004 (the "DISTRIBUTION
AGREEMENT");

      E. WHEREAS, capitalized terms used but not defined herein have the
meanings ascribed to them in the Distribution Agreement;

      F. WHEREAS, upon the terms and subject to the conditions set forth in the
Distribution Agreement, effective on the Distribution Date, (i) CRC shall
Transfer the NYC Membership Interest to NYC Newco (the "NYC SEPARATION") and the
PRR Membership Interest to PRR Newco (the "PRR SEPARATION," together with the
NYC Separation, the "SEPARATIONS"), in exchange for 99.9% of the outstanding
common stock of each of NYC Newco (the "NYC SHARES") and PRR Newco (the "PRR
SHARES," together with the NYC Shares the "NEWCO SHARES"), respectively, and new
debentures issued by each of NYC Newco and PRR Newco, respectively, (ii) CRC
shall then Transfer the Newco Shares to CRR, (iii) CRR shall then Transfer the
Newco Shares to Green (the Transfers in steps (ii) and (iii), to the extent they
relate to the NYC Shares, the "NYC INTERNAL DISTRIBUTIONS," and, to the extent
they relate to the PRR Shares, the "PRR INTERNAL DISTRIBUTIONS," collectively
the "INTERNAL DISTRIBUTIONS"), (iv) Green shall then Transfer the Newco Shares
to CRR Parent (the Transfer of the NYC shares to CRR Parent, the "NYC
DISTRIBUTION," and the transfer of the PRR Shares to CRR Parent, the "PRR
DISTRIBUTION," collectively, the "DISTRIBUTIONS") and (v) CRR Parent shall then
Transfer the NYC Shares to CSX and the PRR Shares to NS. CSX then may engage in
various transactions with respect to the NYC Shares and NYC Newco and NS then
may engage in various transactions with respect to the PRR Shares and PRR Newco
respectively;

<PAGE>

      G. WHEREAS, the Internal Distributions and the Distributions are intended
to qualify as Tax free under Code Sections 368 and 355;

      H. WHEREAS, it is the intent and desire of the parties hereto that a
method be established for allocating certain Taxes among the Parties, for the
treatment of refunds of certain Taxes, and for the conduct of Tax Contests (as
defined herein) that could result in a redetermination of certain Taxes.

      I. NOW, THEREFORE, in consideration of the mutual covenants and promises
contained herein, the parties hereto agree as follows:

                                   ARTICLE I

                                   DEFINITIONS

      As used in this Agreement, the following terms (whether used in the
singular or the plural) shall have the following meanings:

      "ADDITIONAL RULING" has the meaning set forth in Section 3.02(c).

      "AFFILIATED GROUP" has the meaning set forth in the Recitals.

      "AGREEMENT" has the meaning set forth in the Preamble.

      "ALLOCABLE SHARE" means, with respect to the CRR Group, NYC Group and the
PRR Group, an amount equal to the consolidated U.S. federal Income Tax liability
of such Applicable Group for the relevant Tax Period as reflected on that
groups' Pro Forma Consolidated Federal Income Tax Return for such Tax Period;
provided, however, that, if any Applicable Group has a consolidated U.S. federal
Income Tax loss for any Tax Period, such group's consolidated U.S. federal
Income Tax liability for such Tax Period shall be treated as zero.

      "APPLICABLE GROUP" has the meaning set forth in the definition of Pro
Forma Consolidated Federal Income Tax Return.

      "CODE" means the U.S. Internal Revenue Code of 1986, as amended, or any
successor law.

      "CONSOLIDATED GROUP" means an affiliated group of corporations within the
meaning of Code Section 1504 (or any analogous state or local law) that files a
consolidated, combined or unitary Return.

      "CONTEMPLATED ACTIONS" has the meaning set forth in Section 3.02(c).

      "CRC" has the meaning set forth in the Preamble.

      "CRR" has the meaning set forth in the Preamble.

                                      -2-
<PAGE>

      "CRR GROUP" means CRR and its Subsidiaries (excluding the PRR Group and
the NYC Group).

      "CSX" has the meaning set forth in the Preamble.

      "CSX ENTITIES" has the meaning set forth in Section 3.01(a).

      "DISTRIBUTIONS" has the meaning set forth in the Recitals.

      "DISTRIBUTION AGREEMENT" has the meaning set forth in the Recitals.

      "EXEMPTION AMOUNT" means, (A) in the case of the PRR Group, an amount
equal to the largest amount that both (i) does not exceed (but may equal) the
PRR Group's Allocable Share and (ii) when multiplied by 0.724137931 does not
exceed (but may equal) the NYC Group's Allocable Share, (B) in the case of the
NYC Group, an amount equal to the product of (i) the PRR Group's Exemption
Amount and (ii) 0.724137931, and (C) in the case of all other Group's, the
Exemption Amount shall be zero. The Parties agree and acknowledge that the
calculation of the Exemption Amount for the NYC Group and the PRR Group may be
an iterative calculation and agree that such a calculation shall be made with
the goal of determining, and in a manner that will result in, the largest
Exemption Amount for each. The Exemption Amount shall only apply to offset Taxes
described in Section 2.01(a).

      "FINAL DETERMINATION" means any final determination of liability in
respect of a Tax that, under applicable law, is not subject to further appeal,
review or modification through proceedings or otherwise (including the
expiration of a statute of limitations or a period for the filing of claims for
refund, amended Returns or appeals from adverse determinations).

      "GREEN" has the meaning set forth in the Preamble.

      "GREEN CONSOLIDATED GROUP" shall mean Green, the CRR Group, the CRC Group,
the PRR Group, and the NYC Group.

      "GREEN CONSOLIDATED RETURN" means any Tax Return with respect to U.S.
federal Income Taxes filed on a consolidated basis wherein Green and any one or
more of Green's Subsidiaries join in the filing of such Return for any Tax
Period or portion thereof.

      "INCOME TAX" means all taxes based, in whole or in part, on net income or
gross income (including alternative minimum and estimated taxes), together with
any interest, penalties, additions to tax or additional amounts that may become
payable in respect thereof, imposed by any U.S. federal, state, local, foreign
or other taxing authority on a Party.

      "INDEMNIFYING PARTY" shall have the meaning set forth in Section 5.02(c).

      "INTERNAL DISTRIBUTIONS" has the meaning set forth in the Recitals.

      "NEWCO SHARES" has the meaning set forth in the Recitals.

      "NS" has the meaning set forth in the Preamble.

                                      -3-
<PAGE>

      "NS ENTITIES" has the meaning set forth in Section 3.01(b).

      "NYC" has the meaning set forth in the Preamble.

      "NYC DISTRIBUTION" has the meaning set forth in the Recitals.

      "NYC GROUP" means NYC and its Subsidiaries.

      "NYC INTERNAL DISTRIBUTIONS" has the meaning set forth in the Recitals.

      "NYC SEPARATION" has the meaning set forth in the Recitals.

      "NYC SHARES" has the meaning set forth in the Recitals.

      "PARTY" means, as the context requires, one or more of Green, CRR Group, a
member of the CRR Group, CRC Group, a member of the CRC Group, PRR Group, a
member of the PRR Group, NYC Group, or a member of the NYC Group.

      "PERSON" means any individual and any partnership, joint venture,
corporation, limited liability company, trust, unincorporated organization or
other business entity formed or operating under applicable U.S. federal, state
or foreign law.

      "POST-DISTRIBUTION PERIOD" means any Tax Period that, to the extent it
relates to a member of the NYC Group or the PRR Group, begins after a
Distribution Date.

      "PRE-DISTRIBUTION PERIOD" means any Tax Period that, to the extent it
relates to a member of the NYC Group or the PRR Group, ends on or before the
Distribution Date.

      "PRO FORMA CONSOLIDATED FEDERAL INCOME TAX RETURN" means a consolidated
U.S. federal Income Tax Return prepared as if NYC, in the case of the NYC Group
and PRR, in the case of the PRR Group, filed a consolidated federal Income Tax
Return on behalf of the other eligible members of the NYC Group and the PRR
Group as applicable (such applicable group, the "APPLICABLE GROUP"), for such
taxable year; provided, however, that for purposes of preparing such
consolidated federal Income Tax Return for a taxable period that includes the
Distribution Date, the taxable period of the NYC Group and the PRR Group shall
be treated as ending on the Distribution Date. Pro Forma Consolidated Federal
Income Tax Returns shall be prepared in accordance with the following
principles:

            (a)   in the case of the PRR Group and the NYC Group, each Pro Forma
      Consolidated Federal Income Tax Return shall be prepared as if PRR and NYC
      were corporations and were the common parent filing consolidated federal
      income tax returns with its eligible Subsidiaries;

            (b)   each Pro Forma Consolidated Federal Income Tax Return shall be
      prepared as if the Applicable Group had never been included in the Green
      Consolidated Group and did not include members of any other Applicable
      Group;

                                      -4-
<PAGE>

            (c)   each Pro Forma Consolidated Federal Income Tax Return shall
      reflect any actual short taxable years resulting from the Applicable Group
      joining or leaving the Green Consolidated Group;

            (d)   each Pro Forma Consolidated Federal Income Tax Return shall
      reflect any carryovers of net operating losses, net capital losses, excess
      Tax credits, or other Tax attributes ("TAX ITEMS") from prior years' Pro
      Forma Consolidated Federal Income Tax Returns that could have been
      utilized by the Applicable Group if no member of the Applicable Group had
      ever been included in the Green Consolidated Group and all Pro Forma
      Consolidated Federal Income Tax Returns had been actual consolidated
      federal Income Tax Returns; provided, however, that such consolidated
      federal Income Tax Returns shall not reflect any carryovers of any Tax
      Items from a Tax Period ending on or before the date of the Transaction
      Agreement, including Tax Items that arise from any adjustment to taxable
      income, regardless whether such Tax Items were utilized on a consolidated
      federal Income Tax Return of Green for such a Tax Period;

            (e)   each Pro Forma Consolidated Federal Income Tax Return shall be
      prepared such that the provisions of the Code that require consolidated
      computations, such as Code Sections 1201-1212 and 1231, shall be applied
      separately to each Applicable Group;

            (f)   each Pro Forma Consolidated Federal Income Tax Return shall
      apply Treas. Reg. Section 1.1502-13 as if the Applicable Group and the
      Green Consolidated Group (including the members of the NYC Group and the
      PRR Group) were a single affiliated group; provided, however, that if and
      when the Applicable Group ceases to be included in the Green Consolidated
      Group each Pro Forma Consolidated Federal Income Tax Return also shall
      include any gains or losses of the members of the Applicable Group on
      transactions that must be taken into account pursuant to Treas. Reg.
      Section 1.1502-13 and reflected on the Green Consolidated Return; and

            (g)   each Pro Forma Consolidated Federal Income Tax Return shall be
      prepared, to the extent practicable and not inconsistent with items (a)
      through (f) of this definition, in a manner consistent with Green's
      preparation of the consolidated U.S. federal Income Tax Return for the
      Affiliated Group for the relevant Tax Period.

      "PRR" has the meaning set forth in the Preamble.

      "PRR DISTRIBUTION" has the meaning set forth in the Recitals.

      "PRR GROUP" means PRR and its Subsidiaries.

      "PRR INTERNAL DISTRIBUTIONS" has the meaning set forth in the Recitals.

      "PRR SEPARATION" has the meaning set forth in the Recitals.

      "PRR SHARES" has the meaning set forth in the Recitals.

                                      -5-
<PAGE>

      "RETURN" means any report of Taxes due, any information return with
respect to Taxes, or any other similar report, statement, declaration, or
documentation required to be filed under the Code or other laws, any claims for
refund of Taxes paid, and any amendments or supplements to any of the foregoing.

      "RULING" means the initial private letter ruling, if any, issued by the
Service in connection with the Internal Distributions and the Distributions
(and, in each case, any related transactions).

      "RULING DOCUMENTS" means the request for the Ruling submitted to the
Service, together with the appendices and exhibits thereto and any supplemental
filings or other materials subsequently submitted to the Service, in connection
with the Internal Distributions and the Distributions (and, in each case, any
related transactions).

      "SEPARATIONS" has the meaning set forth in the Recitals.

      "SERVICE" means the U.S. Internal Revenue Service, or any successor agency
or authority.

      "STATE AND LOCAL INCOME TAX FLOOR" means (A) in the case of the members of
the PRR Group, an aggregate amount equal to the largest amount that both (i)
does not exceed (but may equal) the aggregate state and local Income Taxes
allocated to such members pursuant to Sections 2.02(a) and (b) and (ii) when
multiplied by 0.724137931, does not exceed (but may equal) the aggregate amount
of state and local Income Taxes allocated to the members of the NYC Group
pursuant to Sections 2.02(a) and (b) and (B) in the case of the members of the
NYC Group, an aggregate amount equal to the product of (i) the PRR Group's State
and Local Income Tax Floor and (ii) 0.724137931 and (C) in the case of all other
Group's, the State and Local Income Tax Floor shall be zero. The Parties agree
and acknowledge that the calculation of the State and Local Income Tax Floor for
the members of the NYC Group and the members of the PRR Group may be an
iterative calculation and agree that such a calculation shall be made with the
goal of determining, and in a manner that will result in, the largest State and
Local Income Tax Floor for each. The State and Local Income Tax Floor shall only
apply to offset those state and local Income Taxes described in Sections 2.02(a)
and (b) that would otherwise be payable.

      "SUBSIDIARY" means, when used with reference to a specified Person, any
corporation or other organization, whether incorporated or unincorporated, of
which at least a majority of the securities or other interests having by their
terms ordinary voting power to elect a majority of the Board of Directors or
others performing similar functions with respect to such corporation or other
organization is directly or indirectly owned or controlled by such Person or by
any one or more of its subsidiaries or by such Person and one or more of its
subsidiaries; provided that CRR Parent and any Person in which CRR Parent owns,
directly or indirectly, an interest (it being assumed for the purposes of this
Agreement that CRR Parent does not own, directly or indirectly, an interest in
either CSX or NSC) shall not be considered a subsidiary of either CSX or NSC for
purposes of this Agreement.

      "TAX" means taxes of any kind, levies or other similar assessments,
customs, duties, imposts, charges or fees, including, without limitation, Income
Taxes, gross receipts, ad valorem,

                                      -6-
<PAGE>

excise, real or personal property, sales, use, payroll, withholding,
unemployment, transfer and gains taxes or other governmental taxes imposed or
payable to the United States, or any state, local or foreign government or
subdivision thereof, and, in each instance, such term shall include any
interest, penalties or additions to tax attributable to such tax or taxes.

      "TAX CONTEST" means an audit, review, examination, or any other
administrative or judicial proceeding (in each case, including, without
limitation, any determination with respect to a claim for refund and without
regard to whether such matter was initiated by an appropriate taxing authority
or in response to a claim for a refund of Taxes) with the purpose or effect of
redetermining Taxes of a Party.

      "TAX-FREE STATUS" shall mean the qualification of each of the
Distributions (i) as transactions described in Sections 355(a)(1) and
368(a)(1)(D) of the Code, (ii) as transactions in which the stock distributed
thereby is qualified property for purposes of section 355(c)(2) of the Code, and
(iii) as a transaction in which Green and its Subsidiaries recognizes no income
or gain other than intercompany items or excess loss accounts taken into account
pursuant to the Treasury Regulations promulgated pursuant to Section 1502 of the
Code.

      "TAX ITEMS" has the meaning set forth in the definition of Pro Forma
Consolidated Federal Income Tax Return.

      "TAX LOSSES" shall mean Taxes, plus any fees, costs and expenses
(including legal and accounting fees, costs and expenses) that lead to an
indemnification payment under Article III.

      "TAX PERIOD" means, with respect to any Tax, the period for which the Tax
is reported as provided under the Code or other applicable law.

      "TRANSACTION AGREEMENT" means the Transaction Agreement among CSX, CSX
Transportation, Inc., NS, Norfolk Southern Railway Company, CRR, CRC and CRR
Holdings LLC, dated as of June 10, 1997.

      The following terms shall have the meanings ascribed to them in the
Distribution Agreement (the page number opposite each term refers to the page in
the Distribution Agreement where such term is defined):

<TABLE>
<S>                                                             <C>
"BUSINESS DAY"..........................................         2
"CRR PARENT"............................................         1
"CSXT"..................................................         1
"DISTRIBUTION DATE".....................................        16
"NSR"...................................................         1
"NYC MEMBERSHIP INTEREST"...............................         4
"NYC NEWCO".............................................         4
"PRR MEMBERSHIP INTEREST"...............................         5
"PRR NEWCO".............................................         5
"TRANSFER"..............................................         6
</TABLE>

                                      -7-
<PAGE>

                                   ARTICLE II

                   ALLOCATION OF INCOME TAXES AND OTHER TAXES

      Section 2.01. Allocation of U.S. Federal Income Taxes.

            (a)   For each Tax Period ending after the date of the Transaction
Agreement and beginning on or before the Distribution Date, each Applicable
Group shall prepare a Pro Forma Consolidated Federal Income Tax Return. Each
Applicable Group shall pay to Green within ten days of receiving a written
request for payment from Green an amount equal to the excess, if any, of (i)
such Group's Allocable Share over (ii) such Group's Exemption Amount; provided,
however, that no portion of the State and Local Income Tax Floor shall be taken
into account.

            (b)   If the U.S. federal Income Taxes of the Affiliated Group are
adjusted for any Tax Period ending after the date of the Transaction Agreement
and beginning on or before the Distribution Date, whether by means of an amended
Return, claim for refund, loss carryback for a tax period following the
Distribution Date or after a Tax Contest, the liability of each Applicable Group
shall be recomputed under Section 2.01(a) to give effect to such adjustments and
appropriate payments shall promptly be made from the Applicable Group to Green
or from Green to the Applicable Group consistent with such recalculation.

      Section 2.02. Allocation of State and Local Income Taxes.

            (a)   If state and local Income Taxes are reflected on a Return
filed by one member of the Green Consolidated Group which Return includes
income, profits or transactions of one or more other members of the Green
Consolidated Group, such Income Taxes shall be allocated among and, subject to
Section 2.02(d), paid by such members consistent with the principles set forth
in Sections 2.01(a) and 2.01(b); provided, however, that no portion of the
Exemption Amount shall be taken into account.

            (b)   State and local Income Taxes attributable to a Return that
includes only the income, profits or transactions of one member of the Green
Consolidated Group shall, subject to Section 2.02(d), be paid by such member;
provided, however, that no portion of the Exemption Amount shall be taken into
account.

            (c)   If the state and local Income Taxes are adjusted for any Tax
Period ending after the date of the Transaction Agreement and beginning on or
before the Distribution Date, whether by means of an amended Return, claim for
refund, carryback of a tax loss from a tax period following the Distribution
Date or after a Tax Contest, the liability for such Taxes shall be recomputed
under the principles of Section 2.02(a) or (b), as applicable, to give effect to
such adjustments and appropriate payments shall be made between the Parties
within 10 days of receipt of notice of the change and the amount involved (or,
if later, within 10 days of receipt of a refund).

            (d)   Notwithstanding the provisions of Section 2.02(a) and (b), the
aggregate annual amount of state and local taxes payable by the members of the
PRR Group and the NYC Group shall equal (A) in the case of the members of the
PRR Group, an amount equal to the

                                      -8-
<PAGE>

excess, if any, of (i) the aggregate amount allocated to such members pursuant
to Sections 2.02(a) over (ii) the State and Local Income Tax Floor and (B) in
the case of the members of the NYC Group, an amount equal to the excess, if any,
of (i) the aggregate amount allocated to such members pursuant to Sections
2.02(a) and (b) over (ii) the State and Local Income Tax Floor.

      Section 2.03. Allocation of Taxes Other Than Income Taxes.

            (a)   Taxes not provided for in Sections 2.01 or 2.02 and
attributable to a Return filed by one member of the Green Consolidated Group and
that relate to the assets, employees, transactions of or are otherwise
attributable to one or more other members of the Green Consolidated Group shall,
to the extent not inconsistent with the Transaction Agreement or any other
agreement entered into among NS, CSX and one or more of the Parties, be
allocated among and paid by such members of the Green Consolidated Group
consistent with the principles set forth in Sections 2.01(a) and 2.01(b);
provided, however, that no portion of the Exemption Amount or the State and
Local Income Tax Floor shall be taken into account.

            (b)   Taxes not provided for by Sections 2.01 or 2.02 and
attributable to a Return that relates to only the assets, employees,
transactions of or is otherwise attributable to only one member of the Green
Consolidated Group shall be paid by such member; provided, however, that no
portion of the Exemption Amount or the State and Local Income Tax Floor shall be
taken into account.

            (c)   If Taxes subject to section 2.03(a) or 2.03(b) are adjusted
for any Tax Period ending after the date of the Transaction Agreement and
beginning on or before the Distribution Date, whether by means of an amended
Return, claim for refund, or after a Tax Contest, the liability for such Taxes
shall be recomputed under the principles of Section 2.03(a) or (b), as
applicable, to give effect to such adjustments and appropriate payments shall be
made between the Parties within 10 days of receipt of notice of the change and
the amount involved (or, if later, within 10 days of receipt of a refund).

                                  ARTICLE III

                 TAXES ATTRIBUTABLE TO THE CSX DISTRIBUTIONS AND
                    THE NS DISTRIBUTIONS; ADDITIONAL RULINGS

      Section 3.01. Restrictions on Post-Distribution Actions.

            (a)   If the NYC Separation, the NYC Internal Distributions and the
NYC Distribution occur and are intended to qualify as tax free under Code
Sections 368 and 355, neither CSX nor any of its Subsidiaries (collectively, the
"CSX ENTITIES") shall take any action, fail to take any action or permit any
Subsidiary to take or fail to take any action, which action or failure to act
would be inconsistent with or cause to be untrue any information, covenant or
representation in the Ruling Documents, the Ruling or this Agreement.

            (b)   If the PRR Separation, the PRR Internal Distributions and the
PRR Distribution occur and are intended to qualify as tax free under Code
Sections 368 and 355, neither NS nor any of its Subsidiaries (collectively, the
"NS ENTITIES") shall take any action, fail to take any action or permit any
Subsidiary to take or fail to take any action, which action or

                                      -9-
<PAGE>

failure to act would be inconsistent with or cause to be untrue any information,
covenant or representation in the Ruling Documents, the Ruling or this
Agreement.

      Section 3.02. Allocation of Distribution Related Liability.

            (a)   NYC Newco and the CSX Entities shall be jointly and severally
liable for, and shall indemnify and hold harmless the NS Entities, Green and
each member of the Green Consolidated Group (other than NYC Newco and the CSX
Entities) from and against, on an after-tax basis, any and all Tax Losses
resulting from the NYC Separation, the NYC Internal Distributions and the NYC
Distribution to the extent such Taxes result from

                  (i)   any event or transaction after the NYC Distribution that
                        involves the stock, assets, or business of the CSX
                        Entities, whether or not such event or transaction is
                        the result of direct actions of, or within the control
                        of, the CSX Entities,

                  (ii)  any act or failure to act on the part of any of the CSX
                        Entities after the NYC Distribution,

                  (iii) the breach of any representation or covenant or the
                        inaccuracy of any information regarding the CSX Entities
                        included in the Ruling Documents or the Ruling, or

                  (iv)  any Contemplated Actions undertaken by any of the CSX
                        Entities pursuant to Section 3.02(d).

            (b)   PRR Newco and the NS Entities shall be jointly and severally
liable for, and shall indemnify and hold harmless the CSX Entities, Green and
each member of the Green Consolidated Group (other than PRR Newco and the NS
Entities) from and against, on an after-tax basis, any and all Tax Losses
resulting from the PRR Separation, the PRR Internal Distributions and the PRR
Distribution to the extent such Taxes result from

                  (i)   any event or transaction after the PRR Distribution that
                        involves the stock, assets, or business of the NS
                        Entities, whether or not such event or transaction is
                        the result of direct actions of, or within the control
                        of, the NS Entities,

                  (ii)  any act or failure to act on the part of any of the NS
                        Entities after the PRR Distribution,

                  (iii) the breach of any representation or covenant or the
                        inaccuracy of any information regarding the NS Entities
                        included in the Ruling Documents or the Ruling, or

                  (iv)  any Contemplated Actions undertaken by any of the NS
                        Entities pursuant to Section 3.02(d).

                                      -10-
<PAGE>

            (c)   NS or CSX may request that Green seek to obtain a ruling from
the Service that certain actions that the requesting party wishes to take (the
"CONTEMPLATED ACTIONS") will not result in the Separations, the Internal
Distributions or the Distributions (and, in each case, any related transactions)
being taxable to the Green Consolidated Group or its direct or indirect
shareholders (an "ADDITIONAL RULING"). Such a request shall not be unreasonably
denied; provided, however, that Green shall not be obligated to request an
Additional Ruling if it determines in good faith that such request might have a
material adverse effect on the Green Consolidated Group. The party requesting
the Additional Ruling shall bear all reasonable costs and expenses incurred by
Green in requesting any Additional Ruling.

            (d)   If an Additional Ruling is obtained in form and substance
acceptable to Green, CSX and NS, then the CSX Entities or the NS Entities, as
the case may be, may engage in such Contemplated Actions to the extent
consistent with the Additional Ruling. CSX agrees that Green is to have no
liability for any Tax resulting from any Contemplated Actions permitted pursuant
to this Section 3.02(d) undertaken by any CSX Entity, and CSX agrees to
indemnify and hold harmless Green, each member of the Green Consolidated Group
(other than the CSX Entities), and each NS Entity from and against any such Tax.
NS agrees that Green is to have no liability for any Tax resulting from any
Contemplated Actions permitted pursuant to this Section 3.02(d) undertaken by
any NS Entity, and NS agrees to indemnify and hold harmless Green, each member
of the Green Consolidated Group (other than the NS Entities), and each CSX
Entity from and against any such Tax.

            (e)   The CSX Entities and the NS Entities shall cooperate with
Green and take all reasonable actions requested by Green in connection with
obtaining the Ruling and any Additional Rulings, including making any
representation or covenant and providing any materials or information requested
by Green or the Service (provided that neither the CSX Entities nor the NS
Entities, as the case may be, shall be required to make any representation or
covenant that is inconsistent with historical facts or as to future matters or
events over which it has no control).

      Section 3.03. Special Representations.

            (a)   Each of NS and PRR hereby represents and warrants that (i) it
has examined the Ruling Documents (including, without limitation, the
representations to the extent that they relate to the plans, proposals,
intentions, and policies of NS and its Subsidiaries and PRR and its
Subsidiaries, the NS business and the PRR business, and the NS affiliated group
of corporations and the PRR Group) and (ii) to the extent descriptive of NS and
PRR their respective Subsidiaries, the NS business and the PRR business, and the
PRR Group, the facts presented and the representations made therein are true and
correct, except to the extent that any such facts or representations:

                  (i)   are about the CSX and its Subsidiaries or the Green
                        Consolidated Group, including NYC (except for facts
                        about the PRR Business);

                  (ii)  describe or characterize the purposes of CSX or Green
                        management for the Distributions; or

                                      -11-
<PAGE>

                  (iii) set forth legal conclusions.

            (b)   Each of NS and PRR hereby represents and warrants that it has
no plan or intention of taking any action, or failing or omitting to take any
action, that would (i) cause either of the Distributions not to have Tax-Free
Status or (ii) cause any representation or factual statement made in this Tax
Sharing Agreement or in the Ruling Documents to be untrue in a manner that would
have an adverse effect on the Tax-Free Status of either of the Distributions.

            (c)   Each of CSX and NYC hereby represents and warrants that (i) it
has examined the Ruling Documents (including, without limitation, the
representations to the extent that they relate to the plans, proposals,
intentions, and policies of CSX and its Subsidiaries and NYC and its
Subsidiaries, the CSX business and the NYC Business, and the CSX affiliated
group of corporations and the NYC Group) and (ii) to the extent descriptive of
CSX and NYC and their respective Subsidiaries, the CSX business and the NYC
Business and the NYC Group, the facts presented and the representations made
therein are true and correct, except to the extent that any such facts or
representations:

                  (i)   are about the NS and its Subsidiaries or the Green
                        Consolidated Group, including PRR (except for facts
                        about the NYC Business);

                  (ii)  describe or characterize the purposes of NS or Green
                        management for the Distributions; or

                  (iii) set forth legal conclusions.

            (d)   Each of CSX and NYC hereby represents and warrants that it has
no plan or intention of taking any action, or failing or omitting to take any
action, that would (i) cause either of the Distributions not to have Tax-Free
Status or (ii) cause any representation or factual statement made in this Tax
Sharing Agreement or in the Ruling Documents to be untrue in a manner that would
have an adverse effect on the Tax-Free Status of either of the Distributions.

                                   ARTICLE IV

              FILING OF INCOME TAX RETURNS; PAYMENT OF INCOME TAXES

      Section 4.01. Tax Returns for Pre-Distribution Periods.

            (a)   Green shall prepare and file or cause to be prepared and filed
(i) the Green Consolidated Return for all Pre-Distribution Periods, including
the taxable period which includes the Distribution Date, (ii) all other Returns
for Pre-Distribution Periods that are required to be filed by Green or any
member of the Green Consolidated Group and (iii) all other Returns of or which
include one or more members of the PRR Group and/or the NYC Group that are
required to be filed (taking into account any extensions) on or prior to the
Distribution Date. Green shall pay, or cause to be paid, any and all Taxes due
with respect to such Returns, subject to its right, if any, to receive payments
for such Taxes from the party to which the Tax liability is allocated pursuant
to Article II of this Agreement.

                                      -12-
<PAGE>

            (b)   Green shall prepare or cause to be prepared, with the
cooperation and assistance of members of the NYC Group or the PRR Group, as the
case may be, and the NYC Group or the PRR Group, as the case may be, shall file
or cause to be filed (in the form and manner so prepared by Green), any Return
that (X) includes one or more members of the NYC Group or the PRR Group for a
Pre-Distribution Period, (Y) is not required to be, and is not, filed on or
prior to the Distribution Date and (Z) is required to be filed by a member of
the NYC Group or the PRR Group. Green shall pay or cause to be paid, to the
relevant taxing authority, any and all Taxes due with respect to such Returns,
subject to its right to receive payments for such Taxes from the party to which
the Tax liability is allocated pursuant to Article II of this Agreement. If
either the NYC Group or the PRR Group receives a refund in respect of any return
filed pursuant to this Section 4.01(b), and such refund is allocable to members
of the Green Consolidated Group other than the NYC Group or the PRR Group
(whichever group filed the Return), such refund shall be paid to Green upon
receipt and allocated among the Parties pursuant to Article II of this
Agreement.

            (c)   Green shall prepare or cause to be prepared any documentation
required to be filed in connection with the making of estimated Tax payments due
in respect of Pre-Distribution Periods for which Green (or another member of the
Green Consolidated Group) is obligated to prepare a Return hereunder, and shall
make any such estimated Tax payments, whether due before, on or after the
Distribution Date, subject to its right to receive payments for such Taxes from
the party to which the Tax liability is allocated pursuant to Article II of this
Agreement.

      Section 4.02. Tax Returns for Post-Distribution Periods.

            (a)   The NYC Group or the PRR Group, as the case may be, shall be
responsible for (i) preparing and filing or causing to be prepared and filed all
Returns that are required to be filed by any member of the NYC Group or the PRR
Group, as the case may be, for any Post-Distribution Period and (ii) paying the
Tax liability due with respect to such Returns.

            (b)   Green shall be responsible for (i) preparing and filing or
causing to be prepared and filed all Returns required to be filed by a member of
the Green Consolidated Group (other than the NYC Group and the PRR Group) for
any Post-Distribution Period and (ii) paying the Tax liability due with respect
to such Returns.

      Section 4.03. Preparation of Returns.

            (a)   Green shall have the authority to (i) determine the entities
to be included in a Return that includes one or more members of the Green
Consolidated Group and (ii) make or revoke any Tax elections, adopt or change
any accounting methods, and determine any other position taken on or in respect
of any Return that it is required to prepare pursuant to this Article IV. The
NYC Group or the PRR Group, as the case may be, shall have the authority to make
or revoke any Tax elections, adopt or change any accounting methods, and
determine any other position taken on or in respect of any Return that it is
required to prepare pursuant to this Article IV.

                                      -13-
<PAGE>

            (b)   The NYC Group or the PRR Group, as the case may be, shall, and
shall cause each of their respective members to prepare and submit promptly to
Green, at the NYC Group or the PRR Group's expense, all information that Green
shall reasonably request, in such form as Green shall reasonably request,
relating to the rights and obligations of Green hereunder, including such
information so requested to enable Green to prepare any Return that Green is
responsible for preparing or filing under this Article IV.

            (c)   Except as required by applicable law or as a result of a Final
Determination, NYC shall not, and shall cause each member of the NYC Group not
to, take any position that is either inconsistent with the treatment of the
Distributions as tax-free under Sections 355 and 368(a)(1)(D) of the Code (or
analogous status under state, local or foreign law) or, with respect to a
specific item of income, deduction, gain, loss, or credit on an income tax
Return for a Post-Distribution Period inconsistent with a position taken on an
income tax Return prepared or filed by Green pursuant to Article IV hereof
(including, without limitation, the claiming of a deduction previously claimed
on any such income tax Return). Except as required by applicable law or as a
result of a Final Determination, PRR shall not, and shall cause each member of
the PRR Group not to, take any position that is either inconsistent with the
treatment of the Distributions as tax-free under Sections 355 and 368(a)(1)(D)
of the Code (or analogous status under state, local or foreign law) or, with
respect to a specific item of income, deduction, gain, loss, or credit on an
income tax Return for a Post-Distribution Period inconsistent with a position
taken on an income tax Return prepared or filed by Green pursuant to Article IV
hereof (including, without limitation, the claiming of a deduction previously
claimed on any such income tax Return). For U.S. federal income Tax purposes,
the taxable year of each domestic member of the NYC Group and the PRR Group
shall end as of the close of the Distribution Date and, with respect to all
other income Taxes, Green (or the appropriate member of the Green Consolidated
Group) and PRR and NYC shall, unless prohibited by applicable law, take all
action necessary or appropriate to close the taxable period of the members of
its respective Group as of the close of the Distribution Date. Neither any
member of the Green Consolidated Group nor any member of the NYC Group or the
PRR Group shall take any position inconsistent with the preceding sentence on
any income tax Return.

                                   ARTICLE V

                                  TAX CONTESTS

      Section 5.01. Notification, Participation and Consultation. Green shall
promptly notify the appropriate member of the NYC Group or the PRR Group, as the
case may be, in writing of any written communication received by Green or any
member of the Green Consolidated Group with respect to any pending or threatened
Tax Contest in connection with any Tax liability (or an issue related thereto)
for which a member of the NYC Group or the PRR Group may be responsible pursuant
to this Agreement (provided that if notice is received with regard to a pending
or threatened Tax Contest for which either the CSX Entities or the NS Entities
would reasonably be expected to have an indemnification obligation pursuant to
Article III of this Agreement, prompt notice shall be supplied to both the NYC
Group and the PRR Group). Green shall include with such notice an accurate and
complete copy of any written communication so received by a member of the Green
Consolidated Group. The failure of Green timely to forward such notification in
accordance with the immediately preceding sentence shall not relieve the

                                      -14-
<PAGE>

appropriate member of the NYC Group or the PRR Group, as the case may be, of its
obligation (if any) to pay such Tax liability or indemnify any other Party
therefor, except and to the extent that the failure timely to forward such
notification actually and materially prejudices the ability of the appropriate
member of the NYC Group or the PRR Group, as the case may be, to contest such
Tax liability or materially increases the amount of such Tax liability. The
parties shall consult with each prior to entry into any settlement.

      Section 5.02. Pre-Distribution Periods.

            (a)   The NYC Group shall have the sole right, at the NYC Group's
expense, to represent the interest of the NYC Group in any Tax Contest with
respect to a Return that (i) includes solely one or more members of the NYC
Group and (ii) relates solely to items for which the NYC Group is responsible
hereunder.

            (b)   The PRR Group shall have the sole right, at the PRR Group's
expense, to represent the interest of the PRR Group in any Tax Contest with
respect to a Return that (i) includes solely one or more members of the PRR
Group and (ii) relates solely to items for which the PRR Group is responsible
hereunder.

            (c)   Except as otherwise provided in Sections 5.02(a) and 5.02(b),
Green shall have the sole right, at its own expense, to represent the interests
of the members of the Green Consolidated Group in any Tax Contest relating to a
Pre-Distribution Period (including the right to retain counsel, at Green's
expense, reasonably acceptable to the NYC Group and the PRR Group); provided,
however, that if a Tax Contest includes any issue for which either the CSX
Entities or the NS Entities would reasonably be expected to have an
indemnification obligation pursuant to Article III of this Agreement, either the
CSX Entities or the NS Entities, or both Groups jointly and cooperatively, as
the case may be (the "INDEMNIFYING PARTY"), shall have the right to represent
the members of the Green Consolidated Group (including the right to retain
counsel of the Indemnifying Party's choice) with respect to any such issue in
such a Tax Contest, and, regardless of whether the Indemnifying Party elects to
represent the members of the Green Consolidated Group with respect to such
issue, any expenses relating to any such issue shall be borne and paid by the
Indemnifying Party. Regardless of whether there is an Indemnifying Party that is
entitled to represent the Green Consolidated Group with respect to any part of a
Tax Contest pursuant to the proviso in the preceding sentence, both the CSX
Entities (or their designee) and the NS Entities (or their designee) shall have
the right to attend any formally scheduled meetings with any taxing authority or
hearings or proceedings before any judicial authorities in connection with any
Tax Contest for which representation is determined by this Section 5.02(c).

      Section 5.03. Post-Distribution Periods.

            (a)   Green shall have the sole right to represent (at its own
expense) the interests of the Green Consolidated Group and its members (other
than the NYC Group and the PRR Group) in any Tax Contest relating to a
Post-Distribution Period.

                                      -15-
<PAGE>

            (b)   The members of the NYC Group or the PRR Group shall have the
sole right to represent (at each group's own expense) the interests of any
member of their respective groups in any Tax Contest relating to a
Post-Distribution Period.

                                   ARTICLE VI

                        COOPERATION AND RECORD RETENTION

      Section 6.01. Cooperation. Each member of the Green Consolidated Group
shall cooperate fully, as and to the extent reasonably requested by any other
member of such group, in connection with the preparation and filing of Returns
and in any Tax Contest. Such cooperation shall include the retention and (upon a
member of the Green Consolidated Group's request) the provision of records and
information that are reasonably relevant to any such Tax Contest and making
employees available on a mutually convenient basis to provide additional
information and explanation of any document or information provided hereunder.

      Section 6.02. Record Retention. The Parties agree (A) to retain all books
and records with respect to Tax matters pertinent to a member of the Green
Consolidated Group for any Pre-Distribution Period until the expiration of the
statute of limitations (including extensions thereof) of the respective Tax
Periods, and to abide by all record retention agreements entered into with any
taxing authority and (B) to give each other member of the Green Consolidated
Group reasonable written notice prior to transferring, destroying or discarding
any such books and records and, if a member of the Green Consolidated Group so
requests, Green or the Applicable Group shall allow such Party to take
possession of such books and records.

                                  ARTICLE VII

                              MISCELLANEOUS MATTERS

      Section 7.01. Amendment and Waiver. This Agreement shall not be amended or
modified in any manner whatsoever without the written consent of each of the
Parties. No failure by any Party to insist upon the strict performance of any
covenant, duty, agreement or condition of this Agreement or to exercise any
right or remedy consequent upon a breach thereof shall constitute waiver of any
such breach or covenant, duty, agreement or condition.

      Section 7.02. Entire Agreement. Except as otherwise provided herein, the
Parties agree that this Agreement constitutes the entire Agreement among them in
respect of the subject matter of this Agreement.

      Section 7.03. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed given on the date delivered if delivered
personally (including by reputable overnight courier), on the date transmitted
if sent by telecopy (which is confirmed) or on the date received if mailed by
registered or certified mail (return receipt requested) to the Parties at the
following addresses (or at such other address for a Party as shall be specified
by like notice):

                                      -16-
<PAGE>

            (a)   If to Green, CRR, CRR Group, CRC or CRC Group:

                  Conrail Inc.
                  2001 Market Street
                  Philadelphia, Pennsylvania  19103
                  Telecopy number:  215-209-1300
                  Attention:  Pat Rogers, Vice President

            (b)   If to NS, PRR or PRR Group:

                  PRR
                  2001 Market Street
                  Philadelphia, Pennsylvania  19103
                  Telecopy number:  215-209-1300
                  Attention:  William A. Galanko, Vice-President-Taxation

                  Copy to:

                  Norfolk Southern Corporation
                  Three Commercial Place
                  Norfolk, Virginia  23510
                  Telecopy number:  757-629-2898
                  Attention:  William A. Galanko, Vice-President-Taxation

            (c)   If to CSX, NYC or NYC Group:

                  NYC
                  2001 Market Street
                  Philadelphia, Pennsylvania  19103
                  Telecopy number:  215-209-1300
                  Attention:  David A. Boor, Vice-President - Tax & Treasury

                  Copy to:

                  CSX Corporation
                  500 Water Street
                  15th Floor
                  Jacksonville, Florida  32202
                  Telecopy number:  904-633-5226
                  Attention:  David A. Boor, Vice-President -Tax & Treasury

      Section 7.04. Dispute Resolution. Any dispute or disagreement relating to
this Agreement shall be resolved under the dispute resolution procedures set
forth in Section 11.12 of the Transaction Agreement.

                                      -17-
<PAGE>

      Section 7.05. Remedies. Any Party having any rights under any provision of
this Agreement will have all rights and remedies set forth in this Agreement and
all rights and remedies that such Party may have been granted at any time under
any other agreement or contract and (except as may be limited by this Agreement)
all of the rights which such Party may have under any law. Any such Party shall
be entitled to enforce such rights specifically, without posting a bond or other
security, to recover damages by reason of any breach of any provision of this
Agreement and to exercise all other rights granted by law.

      Section 7.06. Successors and Assigns. No Party may assign or delegate any
of such Party's rights or obligations under or in connection with this Agreement
without the written consent of the other Parties. All covenants and agreements
contained in this Agreement by or on behalf of any of the Parties will be
binding upon and enforceable against the respective successors and assigns of
such Party and will be enforceable by and will inure to the benefit of the
respective successors and permitted assigns of such Party.

      Section 7.07. Severability; No Presumption Against Drafter. Whenever
possible, each provision of this Agreement will be interpreted in such manner as
to be effective and valid under applicable law, but if any provision of this
Agreement is held to be prohibited by or invalid under applicable law, such
provision will be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of this Agreement. In the event
an ambiguity or question of intent or interpretation arises, this Agreement
shall be construed as if drafted jointly by the Parties and no presumption or
burden of proof shall arise favoring or disfavoring any Party by virtue of the
authorship of any of the provisions of this Agreement.

      Section 7.08. Counterparts. This Agreement may be executed simultaneously
in three or more counterparts, any one of which need not contain the signatures
of more than one Party, but all such counterparts taken together will constitute
one and the same agreement, and it shall not be necessary in making proof of
this Agreement to produce or account for more than one counterpart.

      Section 7.09. Descriptive Headings. The descriptive headings of this
Agreement are inserted for convenience only and do not constitute a part of this
Agreement.

      Section 7.10. No Third-Party Beneficiaries. This Agreement will not confer
any rights or remedies upon any Person other than the Parties and their
respective successors and permitted assigns.

      Section 7.11. Form of Payments and Late Payments. Any payments owed by one
Party to another under this Agreement shall be made in U.S. dollars, and shall
be paid in immediately available funds and in such other manner as the Party to
whom such payment is owed may reasonably request. Any payments required by this
Agreement that are not made when due shall bear interest at the rate publicly
announced by Citibank, N.A. in New York City from time to time as its prime
rate, plus six percent, from the due date of the payment to the date paid.

      Section 7.12. Confidentiality. Each of NYC, PRR and Green agrees that any
information furnished pursuant to this Agreement is confidential and, except as
and to the extent required by law or otherwise during the course of an audit or
litigation or other administrative or

                                      -18-
<PAGE>

legal proceeding, shall not be disclosed to other Persons. Notwithstanding
anything in this Agreement to the contrary, the Parties hereto (and each
employee, representative, or other agent of the Parties) may disclose to any and
all persons, without limitation of any kind, the tax treatment and the tax
structure of the transactions contemplated by this Agreement and all materials
of any kind (including opinions or other tax analysis) relating to such tax
treatment and tax structure (but no other details regarding matters covered by
this Agreement, including without limitation, the identities of the Parties),
provided, however, that with respect to any contemplated mergers and
acquisitions, as defined in paragraph (b)(3)(ii)(B) of treasury regulations
Section 1.6011-4, this Agreement shall only permit the disclosure of the tax
treatment and tax structure, each as defined in treasury regulations Section
1.6011-4, of the transaction (but no other details regarding matters covered by
this Agreement, including, without limitation, the identities of the Parties),
from and after the earliest to occur of the circumstances described in paragraph
(b)(3)(ii)(B) of treasury regulations Section 1.6011-4. This Agreement shall not
be construed to limit in any way any Parties ability to consult any tax advisor
regarding the tax treatment or tax structure of any aspect of the transactions
contemplated by this Agreement. These provisions are meant to be interpreted so
as to prevent any proposed transaction from being treated as offered under
"conditions of confidentiality" within the meaning of the Code and the treasury
regulations thereunder.

      Section 7.13. Governing Law. All questions concerning the construction,
validity and interpretation of this Agreement will be governed by the internal
law, and not the law of conflicts, of the State of Delaware.

                                 * * * * * * * *

                                      -19-
<PAGE>

      IN WITNESS WHEREOF, this Agreement has been duly executed as of the day
and year first above written.

                          GREEN ACQUISITION CORP.,
                          a Pennsylvania corporation

                          By:       /s/ David A. Boor
                             ----------------------------------------------
                             Name: David A. Boor
                             Title: Treasurer

                          CONRAIL INC.

                          By:       /s/ Joseph W. Rogers
                             ----------------------------------------------
                             Name: Joseph W. Rogers
                             Title: Assistant Treasurer

                          CONSOLIDATED RAIL CORPORATION,
                          a Pennsylvania corporation

                          By:       /s/ Joseph W. Rogers
                             ----------------------------------------------
                             Name: Joseph W. Rogers
                             Title: Chief Financial Officer & Corporate
                                    Treasurer

                          PENNSYLVANIA  LINES LLC,
                          a Delaware limited liability company

                          By:       /s/ William A. Galanko
                             ----------------------------------------------
                             Name: William A. Galanko
                             Title: Vice President

                  [Signature Page to Tax Allocation Agreement]

<PAGE>

                          NEW YORK CENTRAL LINES LLC,
                          a Delaware limited liability company

                          By:       /s/ David A. Boor
                             --------------------------------------------
                             Name: David A. Boor
                             Title: Authorized Signatory

                          Solely for purposes of Article III and Sections 3.03
                          and 4.03(c)

                          CSX CORPORATION,
                          a Virginia corporation

                          By:       /s/ David A. Boor
                             --------------------------------------------
                             Name: David A. Boor
                             Title: Vice President Tax & Treasurer

                          Solely for purposes of Article III and Sections 3.03
                          and 4.03(c)

                          NORFOLK SOUTHERN CORPORATION,
                          a Virginia corporation

                          By:       /s/ William A. Galanko
                             --------------------------------------------
                             Name: William A. Galanko
                             Title: Vice President - Taxation

                  [Signature Page to Tax Allocation Agreement]

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