Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On March 18, 2024, Board of Directors Norfolk Southern Corporation (the “Company”) appointed John Orr as Executive Vice President & Chief Operating Officer, effective March 20, 2024.
Mr. Orr, age 60, most recently served as Executive Vice President and Chief Transformation Officer of Canadian Pacific Kansas City Limited since April 2023. Previously, Mr. Orr served as Executive Vice President Operations for Kansas City Southern, overseeing the Transportation, Engineering, Mechanical, Network Operations, Health-Safety-Environmental and Labor Relations teams from 2021-2023. Mr. Orr began his railroad career at Canadian National Railway in 1985, holding various leadership positions including Senior Vice President and Chief Transportation Officer.
There was no arrangement or understanding between Mr. Orr and any other person pursuant to which he was selected as an officer of the Company and there are no family relationships between Mr. Orr and any director or executive officer of the Company. There are no transactions between Mr. Orr and the Company that would require disclosure under Item 404(a) of Regulation S-K.
In connection with Mr. Orr’s appointment as Executive Vice President & Chief Operating Officer, he entered into an Offer Letter with the Company pursuant to which he will receive an annual base salary of $750,000, a cash hiring bonus of $825,000, and be eligible to receive equity and incentive bonus opportunities and other benefits available to other employees at the executive vice president level. For 2024, this includes an equity grant under the Company’s Long-Term Incentive Plan (“LTIP”) with a target value of $2,700,000, comprised of 50% performance share units, 25% nonqualified stock options, and 25% restricted stock units (“RSUs”) each vesting as specified in the terms of the Company’s form award agreements. The Offer Letter also provides Mr. Orr with a one-time, long-term equity grant with a target value of $6,000,000, comprised solely of RSUs vesting in three equal annual installments on each of the first, second, and third anniversaries of the grant date. The Offer Letter further provides severance benefits to Mr. Orr in the event he is terminated by the Company without Cause or if he terminates his employment for Good Reason, including a cash payment equal to two times the sum of his base salary and target annual incentive opportunity, continued vesting of all outstanding equity awards, and payment of all compensation otherwise payable to him as of his termination date, including a prorated annual incentive award for such year payable in the ordinary course. Mr. Orr is also required under the Offer Letter to repay $500,000 of his signing bonus if he were to voluntarily leave the Company without Good Reason during his first two years of employment.
The Company also announced that Paul B. Duncan will depart from his position as Executive Vice President & Chief Operating Officer of the Company, effective March 31, 2024. In connection with his departure, Mr. Duncan is entitled to severance payments and benefits under the terms of the Norfolk Southern Executive Severance Plan pursuant to an involuntary separation.
Item 7.01. Regulation FD Disclosure
The Company issued a press release on March 20, 2024, announcing the appointment of Mr. Orr and the departure of Mr. Duncan. A copy of the press release is furnished herewith as Exhibit 99.1.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
The following exhibits are filed as part of this Current Report on Form 8-K:
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