8-KLeadership ChangesShareholder MattersExhibits & Filings

CSX CORP 8-K Report, Executive Changes (May 11, 2012)

Filed May 11, 2012For Securities:CSX

Summary

CSX Corp. filed an 8-K on May 10, 2012, detailing key executive compensation changes and outcomes from their Annual Shareholder Meeting held on May 9, 2012. The Compensation Committee approved a new long-term incentive program for management spanning 2012-2014, comprising Performance Units tied to a 2014 Operating Ratio target and Restricted Stock Units (RSUs) vesting in May 2015. These awards are designed to motivate executives over a three-year period and are allocated among named executive officers, including CEO Michael J. Ward. The Annual Shareholder Meeting saw the re-election of thirteen directors to the Board, with all nominees receiving a significant majority of votes cast. Additionally, shareholders ratified the appointment of Ernst & Young LLP as the independent registered public accounting firm for 2012 and approved, on an advisory basis, the compensation of certain executive officers. This filing provides transparency into CSX's executive incentive structures and governance matters.

Key Highlights

  • 1CSX implemented a new 2012-2014 Long-Term Incentive Plan for executives, featuring Performance Units and Restricted Stock Units (RSUs).
  • 2Performance Units are contingent on achieving a 2014 Operating Ratio target and will be paid in CSX common stock in early 2015.
  • 3RSUs granted on May 8, 2012, vest on May 7, 2015, subject to a three-year service period and will be settled in CSX shares.
  • 4Named executive officers, including CEO Michael J. Ward, received specific awards of Performance Units and RSUs under the new plan.
  • 5All thirteen nominated directors were re-elected to the CSX Board of Directors at the May 9, 2012 Annual Meeting.
  • 6Shareholders ratified the appointment of Ernst & Young LLP as the company's independent auditor for fiscal year 2012.
  • 7Executive compensation was approved on an advisory (non-binding) basis by shareholders.

Frequently Asked Questions

The new long-term incentive program, approved on May 8, 2012, aims to motivate and reward key management and executives over a three-year period (2012-2014) by linking compensation to the company's performance and continued service.

Payouts for Performance Units are based on CSX's pre-established Operating Ratio target for fiscal year 2014. If the targets are met, the units will be paid out in the form of CSX common stock in early 2015. Payouts can be adjusted downwards by up to 30% based on strategic goals and may vary with the average cost of oil.

The RSUs were granted on May 8, 2012, and will vest on May 7, 2015, provided the participants complete the required three-year service period.

At the meeting, shareholders re-elected all thirteen director nominees, ratified the appointment of Ernst & Young LLP as the independent auditor, and approved, on an advisory basis, the compensation of certain executive officers. No other matters were submitted for shareholder action.