Document:

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                                                                   EXHIBIT 10.89

                                RAILAMERICA, INC.
                           LONG TERM INCENTIVE PROGRAM

SECTION 1.        IN GENERAL

         The Compensation Committee of the Board of Directors of RailAmerica,
Inc. has established this Long-Term Incentive Program (the "Program") pursuant
to and subject to all the terms, provisions and conditions of the Company's 1998
Executive Incentive Compensation Plan, as may be amended from time to time (the
"Plan"). Unless otherwise provided herein, terms used herein that are defined in
the Plan and not defined herein shall have the meanings attributed thereto in
the Plan.

SECTION 2.        PURPOSE OF PROGRAM

         The purpose of the Program is to assist the Company in motivating,
retaining and rewarding high-quality executives and other key employees, by
providing such persons with long term performance incentives in an effort to
expend their maximum efforts in furtherance of the success of the business of
the Company and its Subsidiaries.

SECTION 3.        DEFINITIONS AND TERMS

         3.1.     Accounting Terms. Except as otherwise expressly provided or
the context otherwise requires, financial and accounting terms are used as
defined for purposes of, and shall be determined in accordance with, generally
accepted accounting principles.

         3.2.     Specific Terms. The following words and phrases as used herein
shall have the following meanings:

                  "Base Salary" with respect to any Performance Period means the
         base annualized salary paid by the Employer to a Participant as of the
         first day of such Performance Period, exclusive of any commissions or
         other actual or imputed income from any Employer-provided benefits or
         perquisites, but prior to any reductions for salary deferred pursuant
         to any deferred compensation plan or for contributions to a plan
         qualifying under Section 401(k) of the Code or contributions to a
         cafeteria plan under Section 125 of the Code.

                  "Business Criteria" means EPS.

                  "Code" means the Internal Revenue Code of 1986, as amended
         from time to time.

                  "Committee" means the Compensation Committee which has been
         established to administer the Program in accordance with the terms of
         the Plan and Section 3.1 of this Program.

                  "Company" means RailAmerica, Inc. and any successor whether by
         merger, ownership of all or substantially all of its assets or
         otherwise.

                  "Covered Employee" shall have the same meaning as indicated in
         Section 2(k) of the Plan.

                  "Effective Date" means January 1, 2001.

                  "EPS" for any Year means Generally Accepted Accounting
         Principles (GAAP) earnings per share of the Company as reported in the
         Company's Consolidated Statement of Income set forth in the audited
         annual financial statements of the Company for the Year with such
         adjustments included in the Company's year-end earnings per share as
         filed with the SEC on Form 8-K.

                                       1
<PAGE>

                  "Employer" means the Company and/or any of its Subsidiaries.

                  "Executive" means a key employee (including any officer) of
         the Employer who is selected by the Committee or the Chief Executive
         Officer, in its or his sole discretion, to participate in this Program.
         The Committee may, in its sole discretion, require that an Executive
         own a specific number or percentage of the Company's common stock in
         order to participate in this Program.

                  "Participant" means an Executive selected to participate in
         the Plan by the Committee or the CEO, and shall include both Tier I
         Participants and Tier II-A and II-B Participants. The Committee shall
         set forth the names of the Participants selected on an exhibit to be
         attached hereto for each Performance Period.

                  "Participant Performance Award Formula" means the method of
         computing the specific amount(s) that may be earned by a Participant as
         a Performance Award for a Performance Period, which is timely set forth
         in writing by the Committee in accordance with Section 5.2 hereof. The
         Committee shall set forth such Participant Performance Award Formula on
         an exhibit to be attached hereto for each Performance Period.

                  "Performance Award" means a cash and/or stock payment or
         payment opportunity as the context requires.

                  "Performance Period" means a period of three (3) consecutive
         calendar years with respect to which the Performance Targets are set by
         the Committee. For purposes of this Program, the initial Performance
         Period shall mean the period commencing January 1, 2001 and ending
         December 31, 2003. A new Performance Period, with related Performance
         Award opportunities for selected participants, shall commence each
         January 1 thereafter during the term of the Program, unless otherwise
         determined by the Committee.

                  "Performance Target(s)" means the specific objective goal or
         goals (which may be cumulative and/or alternative) that are timely set
         in writing by the Committee for the Performance Period with respect to
         any one or more of the Business Criteria in accordance with Section 5.2
         hereof. The Committee shall set forth such Performance Targets on an
         exhibit to be attached hereto for each Performance Period.

                  "Plan" means the Company's 1998 Executive Incentive
         Compensation Plan, as amended from time to time.

                  "Program" means the Company's Long Term Incentive Program. as
         amended from time to time.

                  "Section 162(m)" means Section 162(m) of the Code, and the
         regulations promulgated thereunder, all as amended from time to time.

                  "Tier I Participants" means those Participants designated by
         the Committee as Tier I Participants for a Performance Period as
         indicated on Exhibit A attached hereto.

                  "Tier II-A Participants" means those Participants designated
         by the Committee as Tier II-A Participants for a Performance Period as
         indicated on Exhibit A attached hereto.

                  "Tier II-B Participants" means those Participants designated
         by the Committee as Tier II-B Participants for a Performance Period as
         indicated on Exhibit A attached hereto.

                  "Year" means any one or more calendar years commencing on or
         after January 1, 2001.

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SECTION 4.        ADMINISTRATION OF THE PROGRAM

         4.1.     The Committee. The Program shall be administered by the
Committee as set forth and pursuant to the terms and conditions set forth in the
Plan (specifically, Section 8 of the Plan) and in this Program.

         4.2.     Powers of the Committee; Powers of the Chief Executive
Officer. In accordance with the terms and conditions of Section 8 of the Plan,
the Committee shall have the sole authority to establish and administer the
Performance Target(s) and the responsibility of determining from among the
Executives those persons who will participate in and receive Performance Awards
under the Program and, subject to Sections 5 and 6 of the Program, the amount of
such Performance Awards and shall otherwise be responsible for the
administration of the Program, in accordance with its terms. Notwithstanding the
foregoing, the Chief Executive Officer of the Company shall have the authority
to select up to twenty (20) Executives to participate in the Program, provided
that none of the Executives selected by the Chief Executive Officer are Covered
Executives. The Committee shall have the authority to construe and interpret the
Program (except as otherwise provided herein) and any agreement or other
document relating to any Performance Awards under the Program, may adopt rules
and regulations governing the administration of the Program, and shall exercise
all other duties and powers conferred on it by the Program and the Plan, or
which are incidental or ancillary thereto. For each Performance Period, the
Committee shall determine, at the time the Business Criteria and the Performance
Target(s) are set, those Executives who are selected as Participants in the
Program.

         4.3.     Requisite Action. A majority (but not fewer than two) of the
members of the Committee shall constitute a quorum. The vote of a majority of
those present at a meeting at which a quorum is present or the unanimous written
consent of the Committee shall constitute action by the Committee.

         4.4.     Express Authority (and Limitations on Authority) to Change
Terms and Conditions of Performance Awards. Without limiting the Committee's
authority under other provisions of the Plan, but subject to any express
limitations of the Plan and Section 6.8 hereof, the Committee shall have the
authority to accelerate the payment of a Performance Award (after the attainment
of the applicable Performance Target(s)) and to waive restrictive conditions for
a Performance Award (including any forfeiture conditions, but not Performance
Target(s)), in such circumstances as the Committee deems appropriate. In the
case of any acceleration of the payment of a Performance Award after the
attainment of the applicable Performance Target(s), the amount payable shall be
discounted to its present value using an interest rate equal to Moody's Average
Corporate Bond Yield for the month preceding the month in which such
acceleration occurs.

SECTION 5.        PERFORMANCE AWARD PROVISIONS

         5.1.     Provision for Performance Awards. Each Participant may receive
a Performance Award if and only if the Performance Target(s) established by the
Committee, relative to the applicable Business Criteria, are attained. The
applicable Performance Period and Performance Target(s) shall be determined by
the Committee consistent with the terms of the Plan, this Program and Section
162(m). Notwithstanding the fact that the Performance Target(s) have been
attained, the Employer may pay a Performance Award of less than the amount
determined by the formula or standard established pursuant to Section 5.2 or may
pay no Performance Award at all, unless the Committee expressly provides
otherwise by written contract or other written commitment.

         5.2.     Selection of Performance Target(s) and Participant Performance
Award Formulas. The specific Performance Target(s) with respect to the Business
Criteria must be established by the Committee in advance of the deadlines
applicable under Section 162(m) and while the performance relating to the
Performance Target(s) remains substantially uncertain within the meaning of
Section 162(m). At the time the Performance Target(s) are selected, the
Committee shall provide, in terms of an objective formula or standard (the
"Participant Performance Award Formula") for each Participant, and for any
person who may become a Participant after the Performance Target(s) are set, the
method of computing the specific amount that will represent the maximum amount
of Performance Award payable to the Participant if the Performance Target(s) are
attained, subject to Sections 5.1, 5.3, 5.8, 6.1 and 6.8.

         5.3.     Maximum Individual Performance Awards. Notwithstanding any
other provision hereof, no Participant shall receive a Performance Award under
the Plan for any Performance Period in excess of $2,000,000.

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         5.4.     Selection of Participants. For each Performance Period, the
Committee shall determine, at the time the Business Criteria and the Performance
Target(s) are set, those Executives who will participate in the Plan.

         5.5.     Effect of Mid-Year Commencement of Service. To the extent
compatible with Sections 5.2 and 6.8, if services as an Executive commence after
the adoption of the Plan and the Performance Target(s) are established for a
Performance Period, the Committee may grant a Performance Award that is
proportionately adjusted based on the period of actual service during the
Performance Period; the amount of any Performance Award paid to such person
shall not exceed that proportionate amount.

         5.6.     Termination of Employment During Performance Period. Except as
otherwise determined herein or by the Committee or required by applicable law,
no Performance Award shall be payable to a Participant unless the Participant is
employed by the Employer on the last day of the Performance Period for which the
Performance Award is otherwise payable. Notwithstanding the foregoing, if a
Participant's employment with the Employer terminates prior to the last day of a
Performance Period for one of the reasons set forth below in this Section 5.6,
the Committee may, in its sole discretion, pay to a Participant (or the
Participant's estate in the event of the Participant's death) a pro rata portion
of the Performance Award to be earned by a Participant with respect to such
Performance Period. In the event that the Committee determines to pay a pro rata
Performance Award to a Participant, such pro rata amount shall be determined as
follows: at the end of the Performance Period, the Committee shall calculate the
Participant's Performance Award as if he or she remained employed by the
Employer for the entire Performance Period (the "Potential Award"), and then the
Committee shall determine the actual amount payable to the Participant for such
Performance Period by multiplying the Potential Award amount by a fraction, the
numerator of which shall equal the number of full calendar months of the
Participant's actual employment with the Employer during the Performance Period,
and the denominator of which shall equal thirty-six (36). The Committee may
exercise its discretion to pay or not pay Participants whose employment
terminates during the Performance Period a pro rata portion of their Performance
Award pursuant to this Section 5.6 on a case by case basis, and its decisions
need not be uniform or consistent among similarly situated Participants. Any
amounts payable to a Participant pursuant to this Section 5.6 shall not be paid
until after the end of the Performance Period in accordance with Section 5.10
hereof. The reasons for termination of employment subject to this Section 5.6
are: (a) the Participant's death; (b) a Disability suffered by the Participant;
(c) the termination of the Participant's employment with the Employer by the
Employer without Cause; (d) the Participant retires at "normal retirement age",
which for this purpose shall mean age 65; or (e) the termination of the
Participant's employment with the Employer on or after the date on which a
Change in Control of the Company occurs for any reason other than by the
Employer for Cause.

         5.7.     Accounting Changes. Subject to Section 6.8, if, after the
Performance Target(s) are established for a Performance Period, a change occurs
in the applicable accounting principles or practices, the amount of the
Performance Awards paid under this Program for such Performance Period shall be
determined without regard to such change.

         5.8.     Committee Discretion to Determine Performance Awards. The
Committee has the sole discretion to determine the standard or formula pursuant
to which each Participant's Performance Award shall be calculated (in accordance
with Section 5.2), whether all or any portion of the amount so calculated will
be paid, and the specific amount (if any) to be paid to each Participant,
subject in all cases to the terms, conditions and limits of the Plan, this
Program and of any other written commitment authorized by the Committee. To this
same extent, the Committee may at any time establish additional conditions and
terms of payment of Performance Awards (including but not limited to the
achievement of other financial, strategic or individual goals, which may be
objective or subjective) as it may deem desirable in carrying out the purposes
of the Plan and this Program, and may take into account such other factors as it
deems appropriate in administering any aspect of this Program. The Committee may
not, however, increase the maximum amount permitted to be paid to any individual
under Section 5.2 or 5.3 of the Program or award a Performance Award under this
Program if the applicable Performance Target(s) have not been satisfied.

         5.9.     Committee Certification. No Participant shall receive any
payment under this Program unless the Committee has certified, by resolution or
other appropriate action in writing, that the amount thereof has been accurately
determined in accordance with the terms, conditions and limits of the Plan and
this Program, and that the Performance Target(s) and any other material terms
previously established by the Committee or set forth in this Program were in
fact satisfied.

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         5.10.    Time of Payment. Any Performance Awards granted by the
Committee under this Program shall be paid to Participants within six (6) months
following the Committee's determinations under this Section 5 and the
certification of the Committee's findings under Section 5.9. A Performance Award
payable to a Participant shall be made in the following manner: (a) fifty
percent (50%) of the total Performance Award earned shall be payable in cash or
cash equivalents, and (b) the remaining fifty percent (50%) shall be payable in
shares of common stock of the Company, subject to applicable withholding
requirements. The number of shares of common stock of the Company payable to a
Participant with respect to a Performance Award shall be based upon the Fair
Market Value (as defined in the Plan) of a share of common stock of the Company
as of the time of payment of such Performance Award as set forth in this Section
5.10. Notwithstanding the foregoing, the Committee, in its sole discretion (but
subject to any prior written commitments and to any conditions consistent with
Section 6.8 that it deems appropriate), may defer the payout or vesting of any
Performance Award. In the case of the delay of a Performance Award otherwise
payable at or after the attainment and certification of the applicable
Performance Target(s), any additional amount payable shall be based on Moody's
Average Corporate Bond Yield over the deferral period.

SECTION 6.        GENERAL PROVISIONS

         6.1.     No Right to Performance Awards or Continued Employment.
Neither the establishment of the Plan, this Program nor the provision for or
payment of any amounts hereunder nor any action of the Employer, the Board of
Directors of the Company or the Committee in respect of the Program, shall be
held or construed to confer upon any person any legal right to receive, or any
interest in, a Performance Award or any other benefit under this Program, or any
legal right to be continued in the employ of the Employer. The Employer
expressly reserves any and all rights to discharge an Executive in its sole
discretion, without liability of any person, entity or governing body under the
Plan, this Program or otherwise, except to the extent otherwise provided in any
written employment agreement between the Employer and the Executive.

         6.2.     Discretion of Company, Board of Directors and Committee. Any
decision made or action taken by the Company or by the Board of Directors of the
Company or by the Committee arising out of or in connection with the creation,
amendment, construction, administration, interpretation and effect of this
Program shall be within the absolute discretion of such entity and shall be
conclusive and binding upon all persons. No member of the Committee shall have
any liability for actions taken or omitted under the Plan by the member or any
other person.

         6.3.     Absence of Liability. A member of the Board of Directors of
the Company or a member of the Committee or any officer of the Company shall not
be liable for any act or inaction hereunder, whether of commission or omission.

         6.4.     No Funding of Plan. The Company shall not be required to fund
or otherwise segregate any cash or any other assets which may at any time be
paid to Participants under this Program. This Program shall constitute an
"unfunded" plan of the Company. The Company shall not, by any provisions of the
Program or the Plan, be deemed to be a trustee of any property, and any
obligations of the Company to any Participant under the Program shall be those
of a debtor and any rights of any Participant or former Participant shall be
limited to those of a general unsecured creditor.

         6.5.     Non-Transferability of Benefits and Interests. Except as
expressly provided by the Committee, no benefit payable under this Program shall
be subject in any manner to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance or charge, and any such attempted action shall
be void and no such benefit shall be in any manner liable for or subject to
debts, contracts, liabilities, engagements or torts of any Participant or former
Participant. This Section 6.5 shall not apply to an assignment of a contingency
or payment due after the death of the Executive to the deceased Executive's
legal representative or beneficiary.

         6.6.     Law to Govern. All questions pertaining to the construction,
regulation, validity and effect of the provisions of this Program shall be
determined in accordance with the laws of the State of Florida.

         6.7.     Non-Exclusivity. Subject to Section 6.8, this Program does not
limit the authority of the Employer, the Board or the Committee to grant awards
or authorize any other compensation under any other plan or authority,
including, without limitation, awards or other compensation based on the same
Performance Target(s)

                                       5
<PAGE>

used under this Program. In addition, Executives not selected to participate in
this Program may participate in other plans of the Employer.

         6.8.     Section 162(m) Conditions; Bifurcation of Program. It is the
intent of the Company that the Program and Performance Awards paid hereunder
satisfy and be interpreted in a manner, that, in the case of Participants who
are or may be persons whose compensation is subject to Section 162(m), satisfies
any applicable requirements as performance-based compensation. Any provision,
application or interpretation of this Program inconsistent with this intent to
satisfy the standards in Section 162(m) of the Code shall be disregarded.
Notwithstanding anything to the contrary in the Program or in the Plan, the
provisions of the Program may at any time be bifurcated by the Board or the
Committee in any manner so that certain provisions of the Program or any
Performance Awards intended or required in order to satisfy the applicable
requirements of Section 162(m) are only applicable to persons whose compensation
is subject to Section 162(m).

         6.9.     Adjustments. In the event that any dividend or other
distribution (whether in the form of cash, Stock, or other property),
recapitalization, forward or reverse split, reorganization, merger,
consolidation, spin-off, combination, repurchase, share exchange, liquidation,
dissolution or other similar corporate transaction or event affects the EPS of
the Company such that an adjustment is determined by the Committee to be
necessary or appropriate in order to maintain the levels of benefits intended to
be provided to the Participants under the Program, then the Committee shall, in
such manner as it may deem equitable, adjust any or all of (i) the Performance
Targets in respect of any outstanding Performance Awards, (ii) the Business
Criteria in respect of any outstanding Performance Awards, and (iii) the
Participant Performance Award Targets in respect of any outstanding Award. In
addition, the Committee is authorized to make adjustments in the terms and
conditions of, and the criteria included in, Performance Awards in recognition
of unusual or nonrecurring events (including, without limitation, events
described in the preceding sentence, as well as acquisitions and dispositions of
businesses and assets) affecting the Company, any Subsidiary or any business
unit, or the financial statements of the Company or any Subsidiary, or in
response to changes in applicable laws, regulations, accounting principles, tax
rates and regulations or business conditions or in view of the Committee's
assessment of the business strategy of the Company, any Subsidiary or business
unit thereof, performance of comparable organizations, economic and business
conditions, personal performance of a Participant, and any other circumstances
deemed relevant. In no event, however, shall any adjustment pursuant to this
Section 6.9 be authorized or made if and to the extent that such authority or
the making of such adjustment would cause Performance Awards to Participants
designated by the Committee as Covered Employees and intended to qualify as
"performance-based compensation" under Code Section 162(m) and the regulations
thereunder to otherwise fail to qualify as "performance-based compensation"
under Code Section 162(m) and regulations thereunder.

SECTION 7.        AMENDMENTS, SUSPENSION OR TERMINATION OF PROGRAM

         The Board of Directors or the Committee may from time to time amend,
suspend or terminate in whole or in part, and if suspended or terminated, may
reinstate, any or all of the provisions of the Program. Notwithstanding the
foregoing, no amendment may be effective without Board of Directors and/or
shareholder approval if such approval is necessary to comply with the applicable
rules under Section 162(m) of the Code. No additional Performance Awards may be
awarded hereunder after termination of the Program. Upon termination of the
Program, the Committee shall determine, in its sole discretion, to either

                  (a)      terminate all then outstanding Performance Awards as
of the date of termination of the Program (the "Termination Date"), and pay to
each Participant, within thirty (30) days thereafter and in the manner set forth
in Section 5.10 hereof, a pro rata portion of his or her then outstanding
Performance Award(s) for each outstanding Performance Period, such pro rata
amount to be determined as follows: as of the Termination Date, the Committee
shall calculate the Participant's Performance Award by treating the Performance
Period as ending on the Termination Date for purposes of applying the
Participant Performance Award Formula (the "Potential Award"), and the Committee
shall determine the actual amount payable to the Participant for such
Performance Period by multiplying the Potential Award amount, as so determined,
by a fraction, the numerator of which shall equal the number of full calendar
months during the shortened Performance Period, and the denominator of which
shall equal thirty-six (36); or

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<PAGE>

                  (b)      continue the Performance Period(s) then outstanding
and continue to pay any Performance Awards then outstanding on the date of
termination, after the end of the Performance Period(s) and in the same manner
as if the Program had not been terminated.

                                       7
<PAGE>

                                RAILAMERICA, INC.
                           LONG TERM INCENTIVE PROGRAM

                                EXHIBIT A--PLAN 1

          PERFORMANCE PERIOD: JANUARY 1, 2001 THROUGH DECEMBER 31, 2003

BUSINESS CRITERIA:         GROWTH IN EARNINGS PER SHARE (EPS), COMPOUNDED ON AN
                           ANNUAL BASIS OVER THE PERFORMANCE PERIOD (THE "EPS
                           GROWTH")

EPS BASE YEAR:             FY 2000 EPS = $.74

PERFORMANCE TARGETS:

<TABLE>
<CAPTION>
                  MINIMUM                 TARGET                 MAXIMUM
              (8% EPS GROWTH)        (10% EPS GROWTH)       (12% EPS GROWTH)
              ---------------        ----------------       ----------------
<S>           <C>                    <C>                    <C>
FY 2001            $0.80                  $0.81                   $0.83
FY 2002            $0.86                  $0.90                   $0.93
FY 2003            $0.93                  $0.98                   $1.04
</TABLE>

PARTICIPANT PERFORMANCE AWARD FORMULA (THE "PARTICIPANT OPPORTUNITY"):

<TABLE>
<CAPTION>
      PERFORMANCE TARGETS (EPS GROWTH)                   TIER I PARTICIPANTS
      --------------------------------                   -------------------
      <S>                                                <C>
          MINIMUM (8% EPS GROWTH)                         75% OF BASE SALARY
          TARGET (10% EPS GROWTH)                        100% OF BASE SALARY
          MAXIMUM (12% EPS GROWTH)                       125% OF BASE SALARY
</TABLE>

-        A MINIMUM OF 8% EPS GROWTH IS REQUIRED FOR PAYOUTS OF ANY PERFORMANCE
         AWARDS FOR THE ABOVE SPECIFIED PERFORMANCE PERIOD.

-        THE PARTICIPANT OPPORTUNITY IS CAPPED AT 12% EPS GROWTH FOR THE ABOVE
         SPECIFIED PERFORMANCE PERIOD.

-        THE TABLE ABOVE ILLUSTRATES THE PARTICIPANT OPPORTUNITY (BY TIERS) FOR
         THREE EPS GROWTH RESULTS LEVELS. IN THE EVENT THAT THE EPS GROWTH FALLS
         IN BETWEEN THESE LEVELS, THE PARTICIPANT OPPORTUNITY SHALL BE
         INTERPOLATED USING A STRAIGHT-LINE CALCULATION.

PARTICIPANTS:

                               TIER 1 PARTICIPANTS

<TABLE>
<CAPTION>
     NAME                                        TITLE
     ----                                        -----
<S>                       <C>
GARY O. MARINO            CHAIRMAN/PRESIDENT/CHIEF EXECUTIVE OFFICER
DONALD D. REDFEARN        EVP/CHIEF ADMINISTRATIVE OFFICER
GARY SPIEGEL              EVP/CHIEF OPERATING OFFICER--NORTH AMERICAN RAIL GROUP
</TABLE>

                                       8
<PAGE>

                                RAILAMERICA, INC.
                           LONG TERM INCENTIVE PROGRAM

                                EXHIBIT B--PLAN 2

          PERFORMANCE PERIOD: JANUARY 1, 2002 THROUGH DECEMBER 31, 2004

BUSINESS CRITERIA:         GROWTH IN EARNINGS PER SHARE (EPS), COMPOUNDED ON AN
                           ANNUAL BASIS OVER THE PERFORMANCE PERIOD (THE "EPS
                           GROWTH")

EPS BASE YEAR:             FY 2001 EPS = $.72

PERFORMANCE TARGETS:

<TABLE>
<CAPTION>
                 MINIMUM                TARGET                 MAXIMUM
             (8% EPS GROWTH)       (10% EPS GROWTH)       (12% EPS GROWTH)
             ---------------       ----------------       ----------------
<S>          <C>                   <C>                    <C>
FY 2002           $0.78                 $0.79                   $0.81
FY 2003           $0.84                 $0.87                   $0.90
FY 2004           $0.91                 $0.96                   $1.01
</TABLE>

PARTICIPANT PERFORMANCE AWARD FORMULA (THE "PARTICIPANT OPPORTUNITY"):

<TABLE>
<CAPTION>
      PERFORMANCE TARGETS (EPS GROWTH)                   TIER I PARTICIPANTS
      --------------------------------                   -------------------
      <S>                                                <C>
          MINIMUM (8% EPS GROWTH)                         75% OF BASE SALARY
          TARGET (10% EPS GROWTH)                        100% OF BASE SALARY
          MAXIMUM (12% EPS GROWTH)                       125% OF BASE SALARY
</TABLE>

-        A MINIMUM OF 8% EPS GROWTH IS REQUIRED FOR PAYOUTS OF ANY PERFORMANCE
         AWARDS FOR THE ABOVE SPECIFIED PERFORMANCE PERIOD.

-        THE PARTICIPANT OPPORTUNITY IS CAPPED AT 12% EPS GROWTH FOR THE ABOVE
         SPECIFIED PERFORMANCE PERIOD.

-        THE TABLE ABOVE ILLUSTRATES THE PARTICIPANT OPPORTUNITY (BY TIERS) FOR
         THREE EPS GROWTH RESULTS LEVELS. IN THE EVENT THAT THE EPS GROWTH FALLS
         IN BETWEEN THESE LEVELS, THE PARTICIPANT OPPORTUNITY SHALL BE
         INTERPOLATED USING A STRAIGHT-LINE CALCULATION.

PARTICIPANTS:

                               TIER 1 PARTICIPANTS

<TABLE>
<CAPTION>
    NAME                                      TITLE
    ----                                      -----
<S>                     <C>
GARY O. MARINO          CHAIRMAN/PRESIDENT/CHIEF EXECUTIVE OFFICER
DONALD D. REDFEARN      EVP/CHIEF ADMINISTRATIVE OFFICER
GARY SPIEGEL            EVP/CHIEF OPERATING OFFICER--NORTH AMERICAN RAIL GROUP
</TABLE>

                                       9
<PAGE>

                                RAILAMERICA, INC.
                           LONG TERM INCENTIVE PROGRAM

                                EXHIBIT C--PLAN 3

          PERFORMANCE PERIOD: JANUARY 1, 2003 THROUGH DECEMBER 31, 2005

BUSINESS CRITERIA:         GROWTH IN EARNINGS PER SHARE (EPS), COMPOUNDED ON AN
                           ANNUAL BASIS OVER THE PERFORMANCE PERIOD (THE "EPS
                           GROWTH")

EPS BASE YEAR:             FY 2002 EPS = $.75

PERFORMANCE TARGETS:

<TABLE>
<CAPTION>
                    MINIMUM                TARGET                MAXIMUM
                (8% EPS GROWTH)       (10% EPS GROWTH)      (12% EPS GROWTH)
                ---------------       ----------------      ----------------
<S>             <C>                   <C>                   <C>
FY 2003              $0.81                 $0.83                  $0.84
FY 2004              $0.87                 $0.91                  $0.94
FY 2005              $0.94                 $1.00                  $1.05
</TABLE>

PARTICIPANT PERFORMANCE AWARD FORMULA (THE "PARTICIPANT OPPORTUNITY"):

<TABLE>
<CAPTION>
      PERFORMANCE TARGETS (EPS GROWTH)                   TIER I PARTICIPANTS
      --------------------------------                   -------------------
      <S>                                                <C>
          MINIMUM (8% EPS GROWTH)                         75% OF BASE SALARY
          TARGET (10% EPS GROWTH)                        100% OF BASE SALARY
          MAXIMUM (12% EPS GROWTH)                       125% OF BASE SALARY
</TABLE>

-        A MINIMUM OF 8% EPS GROWTH IS REQUIRED FOR PAYOUTS OF ANY PERFORMANCE
         AWARDS FOR THE ABOVE SPECIFIED PERFORMANCE PERIOD.

-        THE PARTICIPANT OPPORTUNITY IS CAPPED AT 12% EPS GROWTH FOR THE ABOVE
         SPECIFIED PERFORMANCE PERIOD.

-        THE TABLE ABOVE ILLUSTRATES THE PARTICIPANT OPPORTUNITY (BY TIERS) FOR
         THREE EPS GROWTH RESULTS LEVELS. IN THE EVENT THAT THE EPS GROWTH FALLS
         IN BETWEEN THESE LEVELS, THE PARTICIPANT OPPORTUNITY SHALL BE
         INTERPOLATED USING A STRAIGHT-LINE CALCULATION.

PARTICIPANTS:

                               TIER 1 PARTICIPANTS

<TABLE>
<CAPTION>
     NAME                                     TITLE
     ----                                     -----
<S>                    <C>
GARY O. MARINO         CHAIRMAN/PRESIDENT/CHIEF EXECUTIVE OFFICER
DONALD D. REDFEARN     EVP/CHIEF ADMINISTRATIVE OFFICER
GARY SPIEGEL           EVP/CHIEF OPERATING OFFICER--NORTH AMERICAN RAIL GROUP
MICHAEL HOWE           SVP/CHIEF FINANCIAL OFFICER
</TABLE>

                                       10<PAGE>

                                                                   EXHIBIT 10.90

                                RAILAMERICA, INC.
                            ANNUAL INCENTIVE PROGRAM

IN GENERAL:

The Compensation Committee of the Board of Directors of RailAmerica, Inc. (the
"Company") has established this Annual Incentive Program (the "AIP") pursuant to
and subject to all the terms, provisions and conditions of the Company's 1998
Executive Incentive Compensation Plan, as may be amended from time to time (the
"Plan"). Unless otherwise provided herein, terms used herein that are defined in
the Plan and not defined herein shall have the meanings attributed thereto in
the Plan.

PURPOSE:

The AIP is a vehicle by which executives, managers and staff of the Company
place a percent of their targeted compensation "at risk" to be paid in whole or
in part based on the achievement of business objectives as set forth by the
Compensation Committee of the Board of Directors of the Company each year. The
AIP achieves several objectives:

-        Linking Company business objectives with the total compensation of
         management and staff;

-        Rewarding achievement/over achievement of annual business goals; and

-        Motivating management and staff by offering them the opportunity to
         achieve or exceed competitive total cash compensation based on their
         performance against specific goals.

PROGRAM YEAR:

The Program year corresponds with the Company's fiscal year of January 1 through
December 31. The Program shall be automatically renewed each year unless
otherwise terminated by the Board of Directors of the Company.

EFFECTIVE DATE:

The AIP became effective on January 1, 1998 and will remain in effect until
amended or terminated by the Board of Directors of the Company.

PROGRAM ADMINISTRATION:

The Compensation Committee of the Board of Directors of the Company administers
the AIP and annually approves the performance measures, objectives, award levels
and funding methods of the Program. The Compensation Committee of the Board of
Directors of the Company may delegate some or all Program Administration to the
Chairman, President and CEO except with respect to Program Administration
covering the Chairman, President and CEO and Company officers.

ELIGIBILITY:

The Program covers designated RailAmerica executives, managers and corporate
staff who have direct influence on business performance and results, and are not
participants in a subsidiary Program.

                                       1

<PAGE>

PROGRAM MEASURES (AND WEIGHTINGS):

Program measures for AIP participants are divided into four categories, as
follows:

<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------
                           CORPORATE                             GROUP/CORRIDOR(1)
------------------------------------------------------------------------------------------------------------------------------
                    MEASURE                         WEIGHTING                       MEASURE                       WEIGHTING
------------------------------------------------------------------------------------------------------------------------------
<S>                                                 <C>          <C>                                              <C>
Consolidated Earnings per Share (EPS)                  25%       Consolidated Earnings per Share (EPS)               25%
------------------------------------------------------------------------------------------------------------------------------
Consolidated Earnings Before Interest Taxes            50%       Group Earnings Before Interest Taxes                25%
Depreciation and Amortization (EBITDA)                           Depreciation and Amortization (EBITDA)
                                                                 -------------------------------------------------------------
                                                                 Corridor Earnings Before Interest Taxes             25%
                                                                 Depreciation and Amortization (EBITDA)
------------------------------------------------------------------------------------------------------------------------------
Consolidated Return on Invested Capital (ROIC)         15%       Consolidated Return on Invested Capital             15%
                                                                 (ROIC)
------------------------------------------------------------------------------------------------------------------------------
Consolidated Acquisitions                              10%       Consolidated Acquisitions                           10%
------------------------------------------------------------------------------------------------------------------------------
</TABLE>

AWARD TARGETS:

Award targets are expressed as a percentage of base salary. Award targets for
on-plan (target) performance are as follows:

<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------
       BAND                                  TITLE                         TARGET %
------------------------------------------------------------------------------------------------
<S>                  <C>                                                 <C>
         1           o   Chairman, President and CEO                         75.0%
------------------------------------------------------------------------------------------------
         2           o   Executive Vice President                            50.0%
------------------------------------------------------------------------------------------------
         3           o   Senior Vice President                           25.0% - 40.0%
------------------------------------------------------------------------------------------------
         4           o   Vice President                                  20.0% - 30.0%
------------------------------------------------------------------------------------------------
         5           o   Director                                        15.0% - 25.0%
                     o   Senior Manager
------------------------------------------------------------------------------------------------
         6           o   Manager                                         10.0% - 15.0%
                     o   Corporate Staff
------------------------------------------------------------------------------------------------
</TABLE>

AWARD PAYMENT:

Payment of awards is based on the actual achievement of specific Company, Group,
or Corridor goals. A Threshold of 80% of goals must be reached before any
payment consideration will be made. Funding for discretionary awards, if any,
shall be recommended by the Chairman, President and CEO and approved by the
Compensation Committee of the Board of Directors of the Company. Partial year
participants receive a pro-rata bonus based on number of months in category.

No participant shall receive any payment under this Program unless the
Compensation Committee of the Board of Directors of the Company has certified,
by resolution or other appropriate action in writing, that the amount thereof
has been accurately determined in accordance with the terms, conditions and
limits of the Plan and this Program, and that the Plan Measure(s), Award
Target(s) and Performance Goal(s) and any other material terms previously
established by the Compensation Committee of the Board of Directors of the
Company or set forth in this Program were in fact satisfied.

1        COO of North American Operations and SVP of International Operations
         shall have performance measures and weightings as follows: Consolidated
         EPS (25%), Consolidated EBITDA (25%), Group EBITDA (25%), Consolidated
         ROIC (15%), and Consolidated Acquisitions (10%).

                                       2

<PAGE>

PERFORMANCE SCHEDULE:

Award levels are based directly on the achievement of Company or Group financial
goals provided the "Threshold" requirement has been met.

Cash payout is calculated using the following table.

<TABLE>
<CAPTION>
------------------------------------------------------------------------
         PERCENT ACCOMPLISHMENT                  PERCENT PAYOUT
------------------------------------------------------------------------
<S>                                              <C>
              Less than 80%                           0.0%
------------------------------------------------------------------------
                   80%                                50.0%
-------------------------------------------------------------------------
                   85%                                62.5%
------------------------------------------------------------------------
                   90%                                75.0%
------------------------------------------------------------------------
                   95%                                87.5%
------------------------------------------------------------------------
                  100%                               100.0%
------------------------------------------------------------------------
                  105%                               120.0%
------------------------------------------------------------------------
                  110%                               140.0%
------------------------------------------------------------------------
                  115%                               160.0%
------------------------------------------------------------------------
                  120%                               180.0%
------------------------------------------------------------------------
                  125%                               200.0%
------------------------------------------------------------------------
           Greater than 125%                         200.0%
------------------------------------------------------------------------
</TABLE>

The maximum cash payout is 200% of Target.

INDIVIDUAL QUALITATIVE ADJUSTMENT:

After the end of the fiscal year, the calculated bonus payment may be adjusted
up to plus or minus ten percent (+/-10%) based on the individual's
personal/qualitative performance as subjectively evaluated by the CEO (except
for officers) and/or as supported by the standard performance
assessment/evaluation form. In the case of officers, the Compensation Committee
of the Board of Directors of the Company shall make all qualitative assessments
and adjustments.

PAYMENT FOR TERMINATION:

Participants who voluntarily terminate are not paid any of the award for the
year in which they terminate.

Participants who are terminated for cause are not paid any of the award for the
year in which they are terminated.

Participants who are involuntary terminated through no fault of their own are
considered for payment based on a decision made annually by the Chairman,
President and CEO and the Compensation Committee of the Board of Directors of
the Company.

In the event of death, disability or early or normal retirement, participants
are normally entitled to receive prorated awards based on the number of months
they actually participated in the Program for the Program year.

                                       3

<PAGE>

MISCELLANEOUS:

Payment from General Assets:

The payment of an award under the Program is from the general assets of the
Company, and a participant under the Program shall have no greater rights to
payment than other general creditors of the Company.

No Right of Employment:

Nothing in the Program, including the employee's eligibility for participation
in the Program, infers any right of employment by the Company to such employees.
The Program does not affect the terms of any employment agreements that may
exist between the Company and any participant. The Company retains all its
rights to discipline or discharge employees who participate in the Program.

Non-Assignment/Death Benefits:

Any awards of the right to a payment of an award granted under this Program are
not assignable or transferable by a participant except by will or the laws of
descent or distribution. Each participant may designate a beneficiary or
beneficiaries to receive payment of any Program death benefits that may be
payable with respect to the participant. During the lifetime of a participant,
only the participant may receive payment of an award granted by this Program. No
transfer of an award shall be effective to bind the Company unless the Company
has been furnished with written notice thereof and a copy of the will or such
evidence, as the Company may deem necessary to establish the validity of the
transfer.

Amendments, Suspension or Termination of the Program:

The Board of Directors may at any time elect to amend, suspend or terminate the
Program.

It is the intent of the Company that this Program and Awards paid hereunder
satisfy and be interpreted in a manner, that, in the case of participants who
are or may be persons whose compensation is subject to Section 162(m) of the
Internal Revenue Code of 1986, as amended ("Section 162(m)"), satisfies any
applicable requirements as performance-based compensation. Any provision,
application or interpretation of this Program inconsistent with this intent to
satisfy the standards in Section 162(m) shall be disregarded. Notwithstanding
anything to the contrary in the Program or in the Plan, the provisions of the
Program may at any time be bifurcated by the Board of Directors of the Company
or the Compensation Committee of the Board of Directors of the Company in any
manner so that certain provisions of the Program or any Awards intended or
required in order to satisfy the applicable requirements of Section 162(m) are
only applicable to persons whose compensation is subject to Section 162(m).

DEFINITIONS:

For purposes of this document and the Program, the terms listed below and
referred to in the document are defined as follows:

BASE SALARY:

The current base salary being paid to the AIP participant(s).

AWARD TARGET:

The incumbent's incentive portion based on the leverage percentage as stated in
this Program document for that position.

                                       4

<PAGE>

DISABILITY:

A participant's incapacity to engage in any substantial gainful activity because
of a medically determinable physical or mental impairment which can be expected
to result in death, or to be of long, continued and indefinite in duration. The
Program Administrator shall make such determination of disability with the
advice of competent medical authority. All participants in similar circumstances
will be treated alike.

RETIREMENT:

Termination of a participant's employment at a specific age determined by the
Company, when the participant chooses to withdraw from their position or
occupation. Normal retirement age is 65.

TERMINATION FOR CAUSE:

"Cause" shall mean such actions by participant involving dishonesty, fraud, the
commission of a felony, gross negligence, or willful misconduct which resorts in
material harm to the business and/or reputation of the Company as reasonably
determined by the Compensation Committee of the Board of Directors of the
Company.

                                       5

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