Summary
CSX Corporation filed an 8-K on February 16, 2016, detailing significant executive compensation changes approved by the Compensation Committee on February 9-10, 2016. The primary focus is the adoption of a new long-term incentive program for 2016-2018, which includes a shift in award composition to 50% Performance Units, 25% Restricted Stock Units, and 25% Stock Options, differing from the prior program's 75% Performance Units and 25% Restricted Stock Units. Payouts for Performance Units are tied to Operating Ratio and Return on Assets, with a potential range of zero to 200% of target awards and a three-year performance cycle.
Key Highlights
- 1CSX adopted a new 2016-2018 Long-Term Incentive Plan with a revised allocation of awards: 50% Performance Units, 25% Restricted Stock Units, and 25% Stock Options.
- 2Performance Unit payouts are contingent upon achieving predetermined goals for Operating Ratio (OR) and Return On Assets (ROA) over a three-year period (2016-2018).
- 3Potential payouts for Performance Units can range from 0% to 200% of target awards, with payouts in CSX common stock.
- 4Restricted Stock Units and Stock Options awarded under the new plan will vest on February 10, 2019, assuming the completion of the three-year vesting period.
- 5Executive Ellen M. Fitzsimmons received a base salary increase from $550,000 to $625,000.
- 6Executive Lisa A. Mancini's base salary was increased from $500,000 to $550,000 following her promotion.
- 7A Change of Control Agreement was entered into with Frank A. Lonegro, providing specific severance benefits in the event of termination within three years of a change in control.
- 8Additional $500,000 Restricted Stock grants were approved for Frederik J. Eliasson, Frank A. Lonegro, and Cindy M. Sanborn, vesting on February 10, 2021.