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Published: 2008-03-26

Stock Purchase and Loan Plan - CSX Corp.



                                 CSX CORPORATION

                          Stock Purchase and Loan Plan
                   As Amended and Restated February 14, 1996,
                       as Amended through October 6, 1998


1.      Purpose

        The CSX Corporation  1991 Stock Purchase and Loan Plan (the '1991 Plan')
was  established  to encourage and increase the ownership of the common stock of
CSX  Corporation  (the  'Company')  by  those  employees  of  the  Company  or a
Subsidiary  who, by virtue of their  responsibilities  or  positions,  were most
likely to have the opportunity to enhance  long-term  performance of the Company
and shareholder  value.  The Company  continues to believe that ownership of the
Company's  common stock  stimulates  the efforts of those  employees  upon whose
judgment  and  interest  the  Company is and will be largely  dependent  for the
successful  conduct of its business and will further the identification of those
employees' interests with those of the Company's shareholders.

        Unless  the 1991 Plan is  extended  or  replaced,  these  benefits  will
generally end July 31, 1996.  Management believes it is in the best interests of
the  Company's  shareholders  to extend the 1991 Plan in order to  continue  the
original objective of assuring that significant  amounts of the Company's common
stock are held by employees  whose  interests are  identified  with those of the
Company's non-employee shareholders.  Accordingly,  the 1991 Plan is amended and
restated  as of  February  14, 1996 (the  'Plan'),  to maintain  and expand this
objective.

        Notwithstanding  anything  contained in this amended and restated  Plan,
the provisions of the 1991 Plan in effect prior to the amendment and restatement
reflected  herein shall continue to apply with respect to Company Stock acquired
pursuant to a Purchase  Award under the 1991 Plan as to which a  Participant  is
not granted or does not exercise an Exchange Award.


2.      Definitions and Construction

        Unless the content  clearly  indicates to the contrary,  in reading this
Plan,  the singular  shall include  plural and the  masculine  shall include the
feminine.

        As used in the Plan, the following terms have the indicated meanings:

               (a)    'Applied  Dividends'  means,  as provided in Section 6(e),
                      dividends  paid on  pledged  Company  Stock used to reduce
                      Interest.

               (b)    'Board' means the Company's Board of Directors.

               (c)    'Business Day' means,  if relevant to a  determination  of
                      the  value of  Company  Stock,  a day on which  shares  of
                      Company Stock are or could be traded on the New York Stock
                      Exchange.

               (d)    'Cause' means a Participant's: (i) act or acts of personal
                      dishonesty  intended  to  result in  substantial  personal
                      enrichment  at the expense of the Company or a Subsidiary;
                      (ii)   repeated    violations    of   the    Participant's
                      responsibilities   which  are

                      demonstrably willful and  deliberate  and  which  are  not
                      remedied  in a  reasonable   period of time after  receipt
                      of written  notice  from the  Company or a Subsidiary;  or
                      (iii)  conviction of a felony   involving moral turpitude.

               (e) 'Change of Control' means any of the following:

                      (i)    Stock  Acquisition.  The   acquisition,  by     any
                             ------------------
                             individual, entity  or group [within the meaning of
                             Section  13(d)(3)  or 14(d)(2)  of  the  Securities
                             Exchange  Act  of 1934, as  amended (the  'Exchange
                             Act')]   (a 'Person')   of   beneficial   ownership
                             (within  the  meaning  of  Rule  13d-3  promulgated
                             under  the  Exchange  Act) of 20% or more of either
                             (A) the then  outstanding  shares of  common  stock
                             of  the  Company  (the 'Outstanding  Company Common
                             Stock'),  or (B)   the  combined  voting  power  of
                             the   then  outstanding   voting securities  of the
                             Company  entitled  to   vote  generally    in   the
                             election    of   directors    (the     'Outstanding
                             Company   Voting Securities');  provided,  however,
                             that  for  purposes  of  this   subsection (i), the
                             following    acquisitions  shall   not   constitute
                             a    Change  of    Control:  (A)   any  acquisition
                             directly  from the Company;  (B)  any   acquisition
                             by  the   Company;   (C)  any   acquisition  by any
                             employee    benefit    plan   (or  related   trust)
                             sponsored  or  maintained  by  the  Company or  any
                             corporation controlled  by  the  Company;   or  (D)
                             any  acquisition by any  corporation pursuant to  a
                             transaction  which  complies  with clauses (A), (B)
                             and  (C)   of  subsection  (iii) of   this  Section
                             2(e); or

                      (ii)   Board  Composition.  Individuals  who,  as  of  the
                             ------------------
                             date  hereof,  constitute   the  Board of Directors
                             (the  'Incumbent  Board') cease  for  any reason to
                             constitute  at  least a  majority  of   the   Board
                             of Directors;    provided,   however,   that    any
                             individual becoming  a director subsequent  to  the
                             date   hereof  whose  election  or  nomination  for
                             election   by   the  Company's   shareholders,  was
                             approved  by  a  vote of at least a majority of the
                             directors  then  comprising   the  Incumbent  Board
                             shall be  considered  as  though   such  individual
                             were   a  member  of   the   Incumbent  Board,  but
                             excluding,  for  this purpose,  any such individual
                             whose initial assumption  of  office  occurs  as  a
                             result    of  an  actual  or   threatened  election
                             contest  with     respect   to   the   election  or
                             removal of directors or other actual or  threatened
                             solicitation of proxies or consents by or on behalf
                             of a Person  other than  the Board of Directors; or

                      (iii)  Business  Combination.   Approval  by  the
                             ---------------------
                             shareholders  of  the  Company of a reorganization,
                             merger, consolidation or sale or other  disposition
                             of   all  or  substantially  all of   the assets of
                             the Company or its principal Subsidiary that is not
                             subject,   as  a   matter of  law  or contract,  to
                             approval by  the  Surface  Transportation  Board or
                             any   successor  agency  or  regulatory body having
                             jurisdiction over such transactions (the  'Agency')
                             (a 'Business  Combination'), in  each case, unless,
                             following such Business Combination:

                             (A)    all or substantially  all of the individuals
                                    and   entities   who   were  the  beneficial
                                    owners, respectively,  of   the  Outstanding
                                    Company   Common   Stock   and   Outstanding
                                    Company Voting  Securities

                                       2


                                    immediately   prior   to    such    Business
                                    Combination  beneficially  own, directly  or
                                    indirectly, more  than 50% of, respectively,
                                    the then outstanding shares of common  stock
                                    and the  combined  voting power of  the then
                                    outstanding  voting  securities  entitled to
                                    vote generally in the election of directors,
                                    as  the  case  may be,  of  the  corporation
                                    resulting  from  such   Business Combination
                                    (including,     without    limitation,     a
                                    corporation  which   as a   result  of  such
                                    transaction  owns   the   Company   or   its
                                    principal    Subsidiary    or    all      or
                                    substantially  all  of   the  assets  of the
                                    Company or its principal  Subsidiary  either
                                    directly    or    through   one   or    more
                                    subsidiaries) in  substantially   the   same
                                    proportions as  their ownership, immediately
                                    prior to  such  Business Combination  of the
                                    Outstanding  Company   Common   Stock    and
                                    Outstanding    Company   Voting  Securities,
                                    as the case may be;

                             (B)    no   Person  (excluding   any    corporation
                                    resulting  from  such  Business  Combination
                                    or any  employee  benefit  plan (or  related
                                    trust) of  the Company or such   corporation
                                    resulting  from such  Business  Combination)
                                    beneficially  owns, directly or  indirectly,
                                    20%  or   more of, respectively,   the  then
                                    outstanding  shares  of  common stock of the
                                    corporation  resulting  from  such  Business
                                    Combination  or the  combined  voting  power
                                    of  the  then outstanding  voting securities
                                    of   such  corporation  except to the extent
                                    that  such  ownership  existed  prior to the
                                    Business Combination; and

                             (C)    at least a  majority  of the  members of the
                                    Board  of  Directors   resulting  from  such
                                    Business  Combination  were  members  of the
                                    Incumbent Board at the time of the execution
                                    of the initial  agreement,  or of the action
                                    of the  Board of  Directors,  providing  for
                                    such Business Combination; or

                      (iv)   Regulated  Business  Combination.  Approval  by the
                             shareholders   of  the   Company   of  a   Business
                             Combination that is subject,  as a matter of law or
                             contract,  to approval by the Agency (a  'Regulated
                             Business   Combination')   unless   such   Business
                             Combination  complies with clauses (A), (B) and (C)
                             of subsection (iii) of this Section 2(e); or

                      (v)    Liquidation   or   Dissolution.   Approval  by  the
                             shareholders   of  the   Company   of  a   complete
                             liquidation  or  dissolution  of the Company or its
                             principal Subsidiary.

               (f)    'Commitment  Date'  means a date  fixed  by the  Committee
                      which shall be the first day of the Commitment Period.

               (g)    'Commitment Period' means a period of twenty (20) Business
                      Days  beginning  with the  Commitment  Date during which a
                      Participant  who has been  granted a  Purchase  Award must
                      purchase all or part of the underlying Company Stock.

                                       3

               (h)    'Committee'  means the Committee of the Board appointed to
                      administer the Plan as provided in Section 10.

               (i)    'Company' means CSX Corporation.

               (j)    'Company  Stock' means the common stock of the Company and
                      rights, options or warrants for the purchase of securities
                      of the  Company  which may be issued with shares of common
                      stock  pursuant,  and  subject  to,  plans  or  agreements
                      adopted or entered into from time to time by the Company.

               (k)    'Disability'  means the  inability to perform the services
                      for  which a  Participant  was  employed  as a result of a
                      physical or mental impediment entitling the Participant to
                      begin receiving benefits under the CSX Salary Continuation
                      and Long-Term Disability Plan.

               (l)    'Equity'  means,  as  of  any  date,  the  Exchange  Award
                      Purchase  Price  of a share  of  Company  Stock  less  the
                      applicable  portion  of the  unpaid  balance  and  accrued
                      interest of a Purchase Loan to which such share of Company
                      Stock is subject.

               (m)    'Exchange Act' means the Securities  Exchange Act of 1934,
                      as amended.

               (n)    'Exchange  Award' means a Purchase Award granted  pursuant
                      to  Section 4 to a  Participant  who  received  a Purchase
                      Award under the 1991 Plan.

               (o)    'Exchange  Award  Down  Payment'  means  a  dollar  amount
                      computed by taking a  percentage,  to be determined by the
                      Committee,  of the Exchange  Award  Purchase  Price of the
                      Company's  common stock on the Commitment  Date multiplied
                      by the number of shares in the Exchange  Award;  provided,
                      however,  such  percentage  shall not be less than 10% nor
                      more than 25%.

               (p)    'Insider' means any person subject to Section 16(b) of the
                      Exchange Act.

               (q)    'Interest' means an amount calculated using the Applicable
                      Federal  Rate,  as  determined  for  purposes  of  Section
                      1274(d) of the IRC.

               (r)    'Interest  Spread'  means,  at the time of  determination,
                      Interest  accrued  on a Purchase  Loan  reduced by Applied
                      Dividends.

               (s)    'IRC' means the Internal Revenue Code of 1986, as amended.

               (t)    'Market  Price'  means the average of the high and the low
                      price of a share of  Company  Stock on the New York  Stock
                      Exchange  (or the  average of the bid and asked  prices if
                      there were no sales),  on any  Business Day as reported in
                      The Wall Street Journal.

               (u)    'Participant'  means  an  employee  of  the  Company  or a
                      Subsidiary who is designated by the Committee, in its sole
                      discretion,  as eligible  for and who  receives a Purchase
                      Award.

                                       4


               (v)    'Purchase  Award'  means a right to  purchase a  specified
                      number of shares  of  Company  Stock  with  Purchase  Loan
                      rights.

               (w)    'Purchase  Loan'   means   an  extension  of  credit  to a
                      Participant  by  the  Company  evidenced by a non-recourse
                      promissory  note for (i) in  the  case of  a  new Purchase
                      Loan,  90% or  95% of  the  Purchase  Price of the Company
                      Stock  awarded to the Participant  under the Plan, or (ii)
                      in  the  case  of  a  Purchase  Loan  made  pursuant to an
                      exchange of  Company  Stock   pursuant  to  Section 4, the
                      Purchase  Price   of  the  Company   Stock  awarded to the
                      Participant  under an Exchange  Award, less  his  Exchange
                      Award Down Payment, and  in either case, bearing Interest,
                      and secured  by a  pledge  of all of the shares of Company
                      Stock purchased by the Participant.

               (x)    'Purchase  Note' means a promissory  note  evidencing  the
                      Purchase  Loan  for  the  balance  of the  Purchase  Price
                      without  recourse  rights against the maker and with other
                      terms  and   conditions   established   by  the  Committee
                      consistent with the Plan.

               (y)    'Purchase  Note  Repayment  Amount'  means the then unpaid
                      balance of the Purchase Note, accrued and unpaid interest,
                      applicable federal and state payroll and withholding taxes
                      on income recognized on the transaction, and any brokerage
                      fees,  collection  fees  and  costs  associated  with  the
                      Purchase Loan.

               (z)    'Purchase Price' or 'Exchange Award Purchase Price' means,
                      with respect to a share of Company  Stock,  the average of
                      the  Market  Price for the five (5)  consecutive  Business
                      Days immediately preceding the Commitment Date.

               (aa)   'Retirement'  means the  termination  of  employment  (for
                      reasons  other than Cause) (i) at or after age 65, or (ii)
                      after  age 55 with at least 10 years of  service  with the
                      Company and/or a Subsidiary.

               (ab)   'Subsidiary'  means a  corporation  more  than  50% of the
                      voting shares of which are owned directly or indirectly by
                      the Company.


3.      Company Stock

        There  shall be an  aggregate  of  9,000,000  shares  of  Company  Stock
reserved  for  issuance  under  the  Plan,  subject  to  Section  9 of the  Plan
(concerning  changes in the capital structure of the Company).  Shares that have
been awarded under the Plan but not issued,  or shares that have been issued but
are returned to the Company in  conformity  with the Plan  (including  shares of
Company Stock  retained,  canceled or  repurchased by the Company in conjunction
with the payment of a Purchase Loan or withholding  taxes), may again be awarded
under the Plan.


4.      Exchange of Shares

        To  encourage,  extend  and expand the  continued  ownership  of Company
Stock,  Participants in the 1991 Plan whose Purchase Loans mature July 31, 1996,
without regard to the one-year extension provided for under Section 6(b), may be
given a  one-time  irrevocable  election  to  exchange  all,  or a portion to be
determined by the Committee,  of any shares purchased under the 1991 Plan for an
enhanced Purchase Award under the Plan (an 'Exchange Award'). To the extent such
shares are exchanged  they shall

                                       5

constitute the 'Exchanged  Shares.' Exchange Awards shall be issued for not more
than the number of shares of common stock  determined  by dividing the excess of
the Exchange Award  Purchase  Price,  as of the Commitment  Date of the Exchange
Award,  of the number of shares  relating to a Purchase Loan issued  pursuant to
the 1991 Plan over the outstanding  amount due on the Purchase Loan on such date
by 25% of the Exchange  Award  Purchase  Price of the Company's  common stock on
such date. In the case of a Participant  who  exercises an Exchange  Award,  his
1991 Purchase Notes shall be canceled.


5.      Stock Purchase Awards

        On or as soon as  practicable  after a Commitment  Date,  the  Committee
shall give notice to each Participant (or to the class of Participants) eligible
for an award  stating (i) the number of shares of Company  Stock covered by each
such Purchase Award or a formula for determining the number of shares of Company
Stock covered by each such Purchase Award,  and (ii) the price,  other terms and
conditions,  if any,  pertaining to each such  Purchase  Award and Purchase Loan
that must be satisfied by a Participant in order to exercise the Purchase Award.

        A Participant  shall  exercise a Purchase Award and Purchase Loan rights
by delivering to the Company during the  Commitment  Period (i) a notice stating
the amount of his down payment  (which shall be 5% or 10% of the Purchase  Price
or his  Exchange  Award Down  Payment in the case of an Exchange  Award) and his
intention to deliver a Purchase Note for the balance of the Purchase Price,  and
(ii) where applicable,  the down payment (which shall be deemed paid in the case
of an Exchange Award) and a Purchase Note.

        The grant of a Purchase  Award and Purchase Loan to a Participant  shall
not obligate the Company or a Subsidiary  of the Company to pay the  Participant
any  particular  amount  of  remuneration,  to  continue  the  employment  of  a
Participant  after the grant or to make further  grants to a Participant  at any
time thereafter.


6.      Purchase Loans

        The Company shall,  subject to paragraph (a) below, upon the Committee's
recommendation,  extend a Purchase  Loan to a  Participant  upon  exercise  of a
Purchase Award subject to the following terms and conditions:

        (a)    The original  principal  amount  of a  new Purchase Loan shall be
               the  difference  between    the    Participant's   down   payment
               (which shall be 5% or 10% of the Purchase Price) and the Purchase
               Price. In the case of an Exchange Award,  the Purchase Loan shall
               be   the   difference  between  the Participant's  Exchange Award
               Down  Payment and the Exchange  Award  Purchase  Price.  The down
               payment for  a  new   Purchase  Loan  shall  be  in cash,  or, if
               authorized by the Committee (i) by  delivery of shares of Company
               Stock having a Market Price equal to the required down payment on
               date  of  transfer   to  the Company,  or (ii) by delivery to the
               Company of a  promissory  note  with terms and  conditions  fixed
               by the Committee and with full recourse rights against the maker.
               The Exchange Award Down Payment shall be deemed to have been paid
               by  the   Equity in a Participant's Exchanged Shares subject to a
               Purchase Loan under the 1991 Plan.

        (b)    The  Purchase  Loan shall  be  due and payable as provided in the
               provisions of  the  Purchase  Note  executed by the  Participant.
               The   term of the  Purchase    Note shall  not  exceed  a  period

                                       6

               of  five  (5)  years;  provided,   however,  the Participant,  in
               his  discretion, may   extend the Purchase Note for one (1) year;
               provided,    further,   that    the   Committee,   may,  in   its
               discretion,  extend a  Purchase Note for up to two (2) years,  in
               which event the Purchase   Note may be prepaid at the election of
               the   Participant  at any   time   within such  extension  period
               subject  to  the  same  rules  and  conditions  as if it had been
               paid  at  maturity.  In no  event  may the  Purchase  Note  term,
               including  extensions, exceed seven (7) years.

        (c)    Purchase Notes shall be in the form approved by the Committee and
               shall contain such terms and conditions,  not  inconsistent  with
               the  Plan,  as  the  Committee   shall   determine  in  its  sole
               discretion; provided, that each Purchase Note shall be subject to
               the terms of the Plan.

        (d)    A  Participant  shall  effect a pledge of all  shares of  Company
               Stock  acquired  by the  Participant  upon  the  exercise  of the
               Purchase  Award by delivering to the Company (i) the  certificate
               or  certificates  for  the  acquired  shares  of  Company  Stock,
               accompanied by a duly executed  stock power in blank,  and (ii) a
               properly  executed stock pledge agreement in the form approved by
               the Committee.

        (e)    Dividends  paid on  shares of Company  Stock  pledged as security
               for a Purchase Loan  shall be first treated as Applied  Dividends
               and then  applied to repay the  Purchase Note. At the  discretion
               of  the  Committee,  the  Company   shall also  pay (i)  dividend
               equivalents  on the  number of shares  purchased   pursuant  to a
               Purchase  Note  equal to the  number of shares  representing  the
               Participant's   Equity in the  Exchanged  Shares,  and (ii)  only
               after  all   interest and  Purchase Price reductions are realized
               under Section 6(g), dividend  equivalents on the number of shares
               purchased   pursuant to a Purchase  Note  in excess of the number
               of shares in (i), above, if any.

        (f)    Within   ten (10)  Business  Days  after the  maturity  date of a
               Purchase  Loan, or  on   the date or dates, if  installments  are
               elected   pursuant to  Section 7(c), as of  which  a  Participant
               elects to prepay a Purchase  Loan and Purchase Note in accordance
               with Section 7, the  Participant shall repay in full the Purchase
               Note Repayment   Amount or the portion  related to an installment
               under Section 7(c).  Payment may be made by (1) a  personal check
               or money order  payable to CSX  Corporation;  (2) a tender by the
               employee  (in  accordance  with  procedures   established  by the
               Company) of shares of  the  Company's  common   stock    having a
               Fair   Market Value on the  date of tender  equaling the Purchase
               Note   Repayment Amount or such   installment portion;  (3)   the
               delivery   of  irrevocable   instructions to a broker to promptly
               deliver  to the  Company  either  sale  proceeds  of shares  sold
               to pay the  Purchase  Note  Repayment  Amount or such installment
               portion or the amount loaned by the broker to pay such amount; or
               (4)   any   combination  of  (1),  (2)  and  (3).  If,   pursuant
               to   procedures established by  the   Company for compliance with
               applicable  securities laws, the Company  believes  that the sale
               of   Company   Stock on  the open market to repay a Purchase Note
               would  violate any  provision of  applicable  securities  laws or
               cause a  Participant  to   incur a liability  under Section 16(b)
               of the  Exchange Act, the  maturity  date  may be extended by the
               Committee  until the first   day the  purchase by the sale of the
               pledged  shares on  the open market can be made without violating
               such   securities laws  or the  Participant  incurring  liability
               under   Section  16(b).  If,  pursuant to procedures  established
               by the Company for  compliance  with  applicable  tax  laws,  the
               Company   believes  that  the repayment of a Purchase Note or the
               sale of  pledged  shares of Company Stock on the open  market  to
               repay  a  Purchase  Note   would   cause   any    portion   of  a
               Participant's   compensation  under the Plan to be  nondeductible
               under   Section 162(m)  of   the IRC,  the  maturity  date may be
               extended by

                                       7

               the    Committee   until   the    first   day   the  repayment of
               a Purchase Note or the sale of pledged  shares of  Company  Stock
               on   the open  market  to  repay a  Purchase  Note can    be made
               without such  compensation  being  non-deductible  under  Section
               162(m) of the IRC, but  in  no event shall such  extension of the
               maturity date be for a period greater than one (1) year.

        (g)    In the  absence  of any  contrary  contractual  agreement  with a
               Participant, the Purchase Price of one half of the pledged shares
               of  Company  Stock  shall be  adjusted  as follows if at any time
               after the first  anniversary  date of a Purchase  Note the Market
               Price of Company  Stock equals or exceeds the  Purchase  Price of
               the Participant's Company Stock by the amount specified below for
               a period of ten (10) consecutive Business Days:

                   Stock Price                         Purchase Price Reductions

               Purchase Price + 20%                               10%
               Purchase Price + 30%                               20%
               Purchase Price + 40%                               30%
               Purchase Price + 50%                               40%
               Purchase Price + 60%                               50%
               Purchase Price + 70%                               60%
               Purchase Price + 80%                               70%
               Purchase Price + 90%                               80%
               Purchase Price + 100%                             100%

               The  principal  amount  of  a  Participant's  Purchase  Loan  and
               Purchase Note, plus accrued and unpaid  Interest,  as well as any
               accrued and unpaid  Interest on a down payment loan referenced in
               Section  6(a) shall be  adjusted  pursuant  to Section 2.5 of the
               Stock  Purchase  Pledge  and Loan  Agreement.  The amount of such
               adjustment to the principal  amount of a  Participant's  Purchase
               Loan and  Purchase  Note shall  equal the amount of the  Purchase
               Price  adjustment  provided above. The provisions of this Section
               and any  applicable  adjustments  to Interest and a Purchase Note
               shall be applied  at the time of  repayment  of a Purchase  Note.
               Decreases in the Market Price of Company Stock  subsequent to the
               completion  of  a  measuring  period  shall  be  disregarded  for
               purposes of the adjustments authorized by this Section.

        (h)    In the event of a change in capital  structure  involving  any of
               the pledged  shares of Company  Stock,  as provided in Section 9,
               such newly  acquired  shares  shall be pledged to the  Company as
               substitute or additional security.

        (i)    Notwithstanding  anything in this Section 6 to the contrary,  the
               Company  shall  not be  required  to  make a  Purchase  Loan to a
               Participant  if  making  such  Purchase  Loan  will (i) cause the
               Company to violate any covenant or other similar provision in any
               indenture,  loan agreement,  or other agreement,  or (ii) violate
               any applicable federal, state or local law.

        (j)    Upon  issuance  by the  Company  of   Company  Stock    purchased
               pursuant to a Purchase Award, the affected  Participant  shall be
               deemed a shareholder  of the Company and (subject to the terms of
               the Plan,  the  Purchase  Loan,  the  Purchase  Note and  related
               documents)  shall be entitled to dividend and voting  rights with
               respect to the Company Stock purchased.

                                       8

7.      Termination of   Employment; Change of   Control; Prepayment of Purchase
        Loan

        If  before  a  Purchase  Note  is  repaid  a  Participant's   employment
terminates  for  any  reason,  or he  is  no  longer  employed  by a  continuing
Subsidiary,  or a Change of Control occurs, the following provisions shall apply
notwithstanding any terms in the Purchase Note to the contrary:

        (a)    Death   or  Disability.  If  a  Participant's     termination  of
               ----------------------
               employment  results  from  death or  Disability,  the    affected
               Participant  (or   the    Participant's   estate    or   personal
               representative) may either (i) continue to hold the Purchase Note
               and  participate  in  the Plan for three  years (or,  if earlier,
               until  the  maturity  date  of the  Purchase  Loan,  as  extended
               by  either the Participant or the Committee,  pursuant to Section
               6(b)), or (ii) within ninety (90) days  of  said  termination  of
               employment (A) elect to prepay the Purchase Note, or (B) elect to
               rescind the Exchange Award or the Purchase Award, as the case may
               be. If the  Participant  elects  to   prepay  the  Purchase  Note
               under (ii)(A), the  Purchase Note shall become due and payable on
               the prepayment date elected by the  Participant.  If an  election
               to  prepay the  Purchase  Note is  effective  prior to  the first
               anniversary  of  the  execution  of  the  Purchase Note,  Section
               6(g) shall  not apply;  if  it is effective on or after the first
               anniversary  of its execution,  Section 6(g) shall apply.  If the
               Participant elects to  rescind the Exchange Award or the Purchase
               Award under (ii)(B), the shares of Company Stock  acquired by the
               Participant  upon the exercise of the Exchange  Award or Purchase
               Award  shall be  transferred  to the   Company, the Purchase Note
               shall be canceled,  the Participant  shall have no further rights
               under  the   Plan,  and   the  Company    shall  have no  further
               obligations to the Participant,  except  that the  Company  shall
               pay to or with  respect to the  Participant, in consideration for
               the  cancellation of the Participant's rights under the  Exchange
               Award or   Purchase  Award,  an  amount   equal to  his  Exchange
               Award  Down   Payment,  as adjusted  under Section 7(h),  or,  if
               applicable, the  Purchase  Award down payment paid to the Company
               pursuant to Section 6(a).

        (b)    Involuntary  Termination With Consent of Company.      If       a
               ------------------------------------------------
               Participant's employer  terminates  his  employment  for  reasons
               other  than  Cause,  the affected Participant  may, within ninety
               (90) days of  said termination of employment (i)  elect to prepay
               the Purchase  Note, or (ii) elect  to  rescind the Exchange Award
               or   the  Purchase    Award,  as   the  case  may   be.  If   the
               Participant   elects to  prepay  the Purchase Note under (i), the
               Purchase Note shall become due and payable on the prepayment date
               elected by the Participant.  If the Participant elects to rescind
               the   Exchange  Award  or  the   Purchase  Award under (ii),  the
               shares of  Company  Stock  acquired by the  Participant  upon the
               exercise of  the   Exchange   Award or   Purchase  Award shall be
               transferred   to the  Company,  the  Purchase    Note   shall  be
               canceled, the Participant shall have no further rights  under the
               Plan, and the Company shall  have no further  obligations  to the
               Participant,  except    that the  Company   shall  pay to or with
               respect  to    the   Participant,  in   consideration  for    the
               cancellation   of the   Participant's  rights under the  Exchange
               Award or   Purchase   Award,  an   amount   equal to his Exchange
               Award   Down Payment,  as   adjusted  under Section 7(h),  or, if
               applicable,  the Purchase  Award down payment paid to the Company
               pursuant to Section  6(a). If the  Participant's  termination of
               employment is prior to the first anniversary of the execution of
               the   Purchase Note,  Section 6(g)   shall  not  apply;  if it is
               on  or   after  the first  anniversary  of the  execution  of the
               Purchase  Note, Section 6(g) shall apply.

        (c)    Retirement.  If   a  Participant's    termination  of  employment
               ----------
               results from  his   Retirement,  the  affected   Participant  may
               either  (i)  continue  to hold the Purchase Note and  participate
               in  the   Plan for   three (3) years (or,   if earlier, until the
               maturity  date   of the  Purchase  Loan,  as

                                       9

               extended by either the Participant, or the Committee, pursuant to
               Section  6(b)), (ii) prepay the Purchase  Note within ninety (90)
               days  of  said  termination  of  employment, or (iii)   repay the
               Purchase  Note in  no  more than three (3) installments, due over
               the  remaining  term of the  Purchase Note, including extensions.
               If an election to  prepay the  Purchase  Note under (ii) or (iii)
               above   is  effective  prior to the   first    anniversary of the
               execution of the Purchase Note,  Section 6(g) shall not apply; if
               it  is   effective on or after   the  first  anniversary   of its
               execution, Section 6(g) shall apply.

        (d)    Voluntary   Termination    with Consent of Company or Involuntary
               -----------------------------------------------------------------
               Termination.  If the  Participant's  termination of employment is
               -----------
               voluntary and    with the   consent of  the  Company,  or, if his
               employer   terminates  his   employment  for  reasons other  than
               Cause and the   Company   does not  consent to  the Participant's
               termination  being  treated  under  Section  7(b),  the  maturity
               date  of the Purchase Note shall be accelerated  without  further
               action of the Committee or the  Company and shall be  required to
               be   prepaid  within   ninety (90)  days of  said  termination of
               employment.  If a    Participant's   termination of employment is
               prior   to the  first  anniversary  of  the  execution  of    the
               Purchase  Note,  Section  6(g) shall   not apply;  if it is on or
               after   the  first anniversary   of the execution of the Purchase
               Note, Section 6(g) shall apply.

        (e)    Termination for Cause or Voluntary  Termination  Without Consent
               ----------------------------------------------------------------
               of Company. If the  Participant's  termination  of  employment is
               ----------
               involuntary for   Cause or a  voluntary  termination  without the
               consent of  the Company,  Section 6(g)   shall not  apply and the
               Participant   agrees to  rescind  the  Exchange  Award  or    the
               Purchase  Award,  as the  case may be. In such case the shares of
               Company  Stock acquired  by the  Participant  upon  the  exercise
               of the Exchange Award  or Purchase  Award shall be transferred to
               the Company, the Purchase Note shall be canceled, the Participant
               shall  have no further  rights under   the Plan, and  the Company
               shall have no further obligations to the Participant, except that
               the Company shall pay to or  with respect to the Participant,  in
               consideration for the  cancellation  of the Participant's  rights
               under the Exchange Award or Purchase  Award,  an amount  equal to
               the excess (if any) of the lesser of: (i) the Market Price on the
               date of  termination  of  employment;  or (ii) an amount equal to
               his Exchange Award Down Payment, as adjusted by Section 7(h), or,
               if   applicable,  the   Purchase  Award down  payment paid to the
               Company    pursuant to   Section 6(a);   less the  Purchase  Note
               Repayment Amount.

        (f)    Divisive Transaction.  If the Participant's employer ceases to be
               --------------------
               a Subsidiary or  if there is a sale of  substantially  all of the
               assets of the  Subsidiary, the affected  Participant may,  within
               ninety (90) days of the closing of such divisive  transaction (i)
               elect to  prepay the Purchase  Note, or (ii) elect to rescind the
               Exchange  Award or the  Purchase   Award,  as the case may be. If
               the   Participant  elects to prepay the Purchase  Note under (i),
               the Purchase  Note shall    become   due  and   payable  on   the
               prepayment   date     elected   by  the   Participant.   If   the
               Participant  elects to rescind the Exchange Award or the Purchase
               Award  under  (ii),  the  shares of  Company  Stock  acquired  by
               the    Participant  upon the   exercise of  the Exchange Award or
               Purchase   Award shall be   transferred  to  the    Company,  the
               Purchase  Note  shall  be  canceled,  the Participant  shall have
               no further rights   under the Plan, and the Company shall have no
               further  obligations to the Participant,  except that the Company
               shall   pay  to  or   with  respect   to  the   Participant,   in
               consideration  for  the cancellation of the  Participant's rights
               under the  Exchange Award or  Purchase Award,  an amount equal to
               his Exchange  Award Down Payment, as adjusted under Section 7(h),
               or, if  applicable,  the  Purchase Award down payment paid to the
               Company   pursuant   to  Section   6(a).    Section   6(g)  shall
               apply  to  all Participants  affected by a divisive  transaction.
               The  foregoing  shall apply whether or not

                                       10

               the participant continues  in the  employ of  the  Subsidiary but
               shall not apply should the Participant continue in the  employ of
               the   Company  or  another   Subsidiary not  part of the divisive
               transaction.

        (g)    Change of Control.  If a Change of Control  occurs, Sections 7(a)
               -----------------
               through (f)  shall  no longer  be  applicable,  the  Interest and
               Purchase  Price  Reductions under  Section  6(g) shall be applied
               as if the Stock  Price had increased  by 100% and the Participant
               may either (i) continue to hold the Purchase Note and participate
               in  the Plan  until  the  maturity  date  of the  Purchase  Note,
               including  any  extensions,  or (ii) within  ninety (90) days of
               said  Change of Control and, if  applicable,  within  ninety (90)
               days of a   final   Agency    action  in   a  Regulated  Business
               Combination  under   Section  2(e) (iv),  (A) elect to prepay the
               Purchase  Note,  or (B) elect to  rescind the  Exchange  Award or
               the  Purchase  Award,  as  the  case may be. If  the  Participant
               elects  to   prepay the Purchase Note under (ii)(A), the Purchase
               Note shall  become due and payable on the prepayment date elected
               by   the  Participant,  and  the provisions of Section 6(g) shall
               apply.  If the  Participant  elects to rescind the Exchange Award
               or the Purchase Award under  (ii)(B), the shares of Company Stock
               acquired by  the  Participant  upon  the exercise of the Exchange
               Award or  Purchase  Award shall be transferred  to  the  Company,
               the  Purchase  Note  shall  be  canceled,  the Participant  shall
               have no further rights under the Plan, and the Company shall have
               no  further  obligations to the   Participant,  except  that  the
               Company   shall pay  to  or  with  respect  to  the  Participant,
               in   consideration  for  the  cancellation  of the  Participant's
               rights   under   the Exchange  Award or Purchase Award, an amount
               equal to his Exchange  Award   Down Payment,  as  adjusted  under
               Section 7(h),  or, if  applicable,  the  Purchase   Award    down
               payment paid to the Company pursuant to Section 6(a).

        (h)    Adjustment of Exchange  Award Down Payment.  Solely  for purposes
               ------------------------------------------
               of determining the amount available to a  Participant  under this
               Section 7, a  Participant's Exchange Award Down Payment  shall be
               adjusted as follows:  the dollar  amount  of  the Exchange  Award
               Down Payment  computed  as of the date of the Exchange of  Shares
               pursuant to Section 4 shall be divided by the Market Price on the
               date of  such  Exchange of   Shares,  to  arrive  at a  number of
               equivalent  shares.  On   the Purchase   Loan  maturity   date or
               prepayment  date  applicable  under this Section  7,  the  number
               of   equivalent  shares  determined  in  the  preceding  sentence
               will be  multiplied by the Market Price on such date to arrive at
               the Participant's Exchange Award Down Payment as adjusted.

        (i) Certain Terms of Purchase Awards or Exchange Awards. Notwithstanding
any provision of this Plan to the contrary,  in the discretion of the Committee,
a Purchase  Award  and/or  Exchange  Award may  provide,  to the  extent  deemed
appropriate by the Committee to eliminate or reduce the  applicability or impact
of Sections  280G and/or 4999 of the IRC,  for: (i) the  cancellation  of shares
and/or a  reduction  or  increase  in the  amount  of a  Purchase  Note,  (ii) a
limitation  of the  reduction  of the  Purchase  Price  pursuant to Section 7(g)
above,  (iii) the elimination of any acceleration of a Purchase Note or right to
prepay such Note,  or (iv) a reduction or  limitation of any other benefit under
this Plan or otherwise to a Participant.


8.      Non-transferability of Purchase Awards

        Except as provided in Section 7(a),  neither right of Participation  nor
Purchase Awards are assignable or transferable.

                                       11

9.      Change in Capital Structure

        If the number of  outstanding  shares of Company  Stock is  increased or
decreased as a result of a subdivision or consolidation  of shares,  the payment
of a stock dividend, stock split, or any other change in capitalization effected
without receipt of consideration by the Company (including,  but not limited to,
the creation or issuance to the  shareholders  generally  of rights,  options or
warrants for the purchase of common or preferred stock of the Company),  or if a
spin-off  transaction  occurs,  then the  number  and kind of shares of stock or
securities  of the  Company  to be subject to the Plan,  the  maximum  number of
shares or securities  which may be delivered  under the Plan, and other relevant
provisions shall be appropriately adjusted by the Committee, whose determination
shall be binding and conclusive on all persons.

        If there is a Change of Control,  the  Committee  may take such actions,
not inconsistent with the Plan, with respect to outstanding unexercised Purchase
Awards as the Committee deems appropriate.

        Notwithstanding  anything in the Plan to the contrary, the Committee may
take the  foregoing  actions  without  the consent of any  Participant,  and the
Committee's determination shall be conclusive and binding on all persons for all
purposes.


10.     Administration of the Plan

        The Plan shall be administered by the Committee,  consisting of not less
than three Directors of the Company appointed by the Board. Subject to paragraph
(d) below,  the Committee  shall be the  Compensation  Committee of the Board or
such  subcommittee  appointed by the  Compensation  Committee  consisting of not
fewer than two non-employee directors.  The Committee shall at all times consist
of outside  directors  within the  meaning  of  Section  162(m) of the IRC.  The
Committee  shall have general  authority to impose any  limitation  or condition
upon a Purchase Award the Committee deems  appropriate to achieve the objectives
of the Purchase Award and the Plan, and in addition,  and without limitation and
in addition to powers set forth elsewhere in the Plan,  shall have the following
specific authority:

        (a)    The  Committee  shall have the power and complete  discretion  to
               determine  (i)   which  employees of the Company or a  Subsidiary
               shall  be  Participants,  (ii) which  Participants  shall receive
               a Purchase  Award with Purchase Loan rights, (iii) the  number of
               shares of Company  Stock to be  covered  by each  Purchase Award,
               (iv) the  Market  Price of Company  Stock,  (v) the time or times
               when a Purchase Award shall be granted, (vi) whether a Disability
               exists,  (vii) the manner in which  payment will be made upon the
               exercise of  a Purchase  Award, (viii)  the   number of shares of
               Company  Stock  required  to be pledged at  any given  time,  and
               to   make  appropriate   adjustments  and  (ix)  any   additional
               requirements relating to Purchase Awards that the Committee deems
               appropriate.

        (b)    The  Committee may adopt rules and  regulations  for carrying out
               the Plan and for the sale or other  disposition  of Company Stock
               acquired   pursuant   to  the  Plan.   The   interpretation   and
               construction  of any provision of the Plan by the Committee shall
               be final and conclusive.  The Committee may consult with counsel,
               who may be  counsel  to the  Company,  and  shall  not  incur any
               liability for any action taken in good faith in reliance upon the
               advice of counsel.

        (c)    A majority of the members of the  Committee  shall  constitute  a
               quorum,  and all  actions  of the  Committee  shall be taken by a
               majority  of the  members  present.  Any action may be

                                       12

               taken by a written  instrument signed by all of the members, and
               any action so taken  shall be fully  effective  as if it had been
               taken at a  meeting.

        (d)    The   Board  may from time to time appoint or remove  members and
               fill  vacancies, however  caused,  in the  Committee.  Insofar as
               it is necessary to satisfy the requirements  of Section  16(b) of
               the  Exchange   Act and  Rule 16b-3  thereunder, no member of the
               Committee  shall   be  eligible to  participate in the Plan or in
               any   other  plan of the  Company or a Subsidiary  that  entitles
               participants  to   acquire    stock,   stock    options  or stock
               appreciation  rights   of  the  Company  or a Subsidiary,  and no
               person  shall   become a  member of  the  Committee  if,   within
               the  preceding  one-year  period,  the  person  shall  have  been
               eligible  to participate in such a plan.

        (e)    Down  payment  loans  under the 1991 Plan shall be  extended on a
               full recourse  basis for up to seven (7) years in the case of any
               Participant  who receives and exercises an Exchange Award. To the
               extent that a Purchase Note is extended,  accelerated  or prepaid
               under the  terms of the Plan,  said  extension,  acceleration  or
               prepayment shall also apply to the down payment loan.


11.     Effective Date of the Plan

        The 1991 Plan became  effective as of December 12, 1990.  This amendment
and restatement of the 1991 Plan shall be effective as of February 14, 1996, and
shall be submitted to the  shareholders  of the Company for approval.  Until (i)
the Plan has been approved by the Company's shareholders, (ii) the Company Stock
issuable  under the Plan has been  registered  with the  Securities and Exchange
Commission,  (iii) the  Company  Stock is  accepted  for listing on the New York
Stock Exchange,  and (iv) the  requirements of any applicable  state  securities
laws have been  met,  no  Purchase  Award  shall be  granted  or  Purchase  Loan
authorized by the Committee.


12.     Termination, Modification

        If not  sooner  amended  or  terminated  by the  Board,  this Plan shall
terminate  at the close of business on February  13,  2006.  No Purchase  Awards
shall be made under this Plan after  termination.  The Board may  terminate  the
Plan or may  amend  the  Plan in  such  respects  as it  shall  deem  advisable;
provided,  however,  that, if necessary to satisfy the  requirements  of Section
16(b) of the Exchange Act, the New York Stock Exchange or applicable  state law,
the  shareholders  of the  Company  must  approve any  amendment  that would (i)
materially  increase the benefits accruing to Participants  under the Plan, (ii)
materially  increase  the number of shares of  Company  Stock that may be issued
under the Plan, or (iii) materially modify the Plan's eligibility  requirements.
A  termination  or amendment  of the Plan shall not,  without the consent of the
affected  Participant,  adversely impact a Participant's rights under a Purchase
Award previously granted to him.


13.     Notice

        All notices and other  communications  required or permitted to be given
under this Plan shall be in writing  and shall be deemed to have been duly given
if delivered  personally or mailed first class, postage prepaid, as follows: (i)
if to the  Company--at  its principal  business  address to the attention of the

                                       13

Secretary;  (ii) if to any  Participant--at  the last address of the Participant
known to the sender at the time the notice or other communication is sent.


14.     Governing Law

        The terms of this Plan shall be governed by the laws of the Commonwealth
of Virginia.

                                       14