LONG TERM INCENTIVE CASH PROGRAM
Performance Period 2000-2002
1. Purpose. The CSX Long Term Incentive Cash Program (the "Program") for
the 2000-2002 Performance Period is intended to provide long term cash
incentives to select management employees to improve CSX's financial
performance, and to reward such employees with a cash payment if CSX's
performance pursuant to the terms of the Program are met. The Program shall be
operated as Performance Grants under the provisions of Section 8 of the CSX
Omnibus Incentive Plan.
2. Definitions. As used in the Program, the following terms have the
meanings indicated below. All other capitalized terms have the definitions in
the CSX Omnibus Incentive Plan:
(a) "Award Matrix" means a matrix which contains the Performance Goals
selected by the Committee for the Performance Period and other objective
factors necessary to determine the amount, if any, of the Long Term Award
for the Performance Period.
(b) "Cash Unit" means a unit with a value of $1.00 that is designated
as part of a Long Term Grant.
(c) "Long Term Award" means a payment of cash at the end of the
Performance Period based on the terms of the Long Term Grant.
(d) "Long Term Grant" means a grant of Cash Units to a Participant
under the Program.
(e) "Participant" means any employee of CSX or a Subsidiary who
receives a Long Term Grant under the Program.
(f) "Peer Group" means a group of public companies that the Committee
determines to be appropriate competitors of CSX for purposes of performance
comparison. During a Performance Period, the Peer Group shall be adjusted
as the Committee determines is required due to mergers or other corporate
events affecting companies in the Peer Group.
(g) "Performance Period" means a three fiscal-year period. The
Performance Period shall commence on January 1, 2000.
(h) "Performance Rank" means a ranking of CSX in comparison to the
Peer Group with respect to one or more Performance Criteria for the
(i) "Plan" means the CSX Omnibus Incentive Plan.
(j) "Program" means the CSX Long Term Incentive Cash Program for the
2000-2002 Performance Period.
(a) All present and future management employees of CSX or a Subsidiary
shall be eligible to receive Long Term Grants under the Program. The Committee
shall have the power and complete discretion to select eligible employees to
receive Long Term Grants and to determine for each employee the terms and
conditions of each Long Term Grant.
(b) A person who becomes eligible to participate at any time after the
commencement of a Performance Period or a Participant whose employment
terminates during a Performance Period because of death, Retirement, or
Disability shall be eligible to receive a pro rata Long Term Grant based on the
ratio that the Participant's number of full months of participation during the
Performance Period bears to the number 36. A Participant who is removed from the
original position held when the Long Term Grant was made or whose employment
terminates during the Performance Period for reasons other than death,
Retirement, Disability, or involuntary separation for reasons other than Cause
shall forfeit any outstanding Long Term Grant, unless otherwise provided by the
(c) A Participant in this Program shall be eligible to participate in
other cash incentive or profit sharing plans established or maintained by CSX or
any Subsidiary. No award under any other incentive or profit sharing plan
maintained by CSX may be made contingent, in whole or in part, on the
Participant not receiving payment of a Long Term Award under this Program.
4. Determination of Awards.
(a) Before or within ninety days of the beginning of each Performance
Period, the Committee will select one or more Performance Criteria, the
appropriate Performance Goals for the Performance Criteria, and number of Cash
Units for each Participant with respect to which a Long Term Grant may be made.
The Committee's determinations shall be set forth in an Award Matrix. The
Committee shall consult with senior management executives of CSX to the extent
deemed appropriate by the Committee. Performance Criteria may be used singularly
or in combination, as the Committee determines. The Award Matrix will fix the
objective components for determining whether a Long Term Award will be paid and,
if so, the amount of the Long Term Award. Long Term Awards shall be based on a
percentage of each Participant's Cash Units for the Performance Period if and to
the extent the Performance Goal is achieved. The amount payable to a Participant
for the Performance Period will be determined from the Award Matrix as a
percentage of the Cash Units if the actual performance under a Performance Goal
is within the range fixed by the Committee for the Performance Period
to generate a payment under the Award Matrix. As determined by the
Committee, Performance Criteria shall be calculated in accordance with
public financial statements of CSX and the Peer Group
(b) The Committee may establish such threshold requirements for the
payment of a Long Term Award as the Committee shall deem appropriate. Once
fixed, the Performance Criteria and Performance Goals for a Performance
Period may not be modified as to a Covered Employee, except as provided in
(c) Before any Long Term Award may be paid for a Performance Period,
the Committee shall certify in writing that the Performance Goals and any
other requirements of the Program have been satisfied for the Performance
(d) Even though the Performance Goals have been met, the Committee may
reduce or eliminate entirely any Long Term Award to a Participant if the
Committee determines that such action is in the best interests of CSX. Any
action by the Committee under this Section 4(d) shall be conclusive and
binding on CSX and the Participant.
(e) It is the intent of the Committee that this Program and any Long
Term Grant satisfy, and be interpreted in a manner to satisfy, the
applicable requirements of Code Section 162(m) with respect to a Covered
Employee. If any provision of this Program or if any Long Term Grant would
otherwise conflict with the expressed intent of this Section 4(e), that
provision shall be interpreted so as to avoid such conflict to the extent
5. Payment of Long Term Awards. All Long Term Grants will be paid in cash.
6. Administration. The Committee shall administer the Program under the
terms and conditions of the Plan.
7. Effective Date of the Program. The effective date of the Program is
January 1, 2000.
8. Amendment and Termination. This Program shall continue until the end of
the 2002 fiscal year. The Program may be amended or terminated as provided under