Exhibit 10.19
Supplemental Retirement Benefit Plan
of CSX Corporation and Affiliated Corporations
As Amended and Restated January 1, 1995
(As Amended through December 11, 1996)
Section I - INTRODUCTION
1. The purpose of this plan, hereinafter called the "Supplemental
Plan", is to provide benefit payments to individuals who are participants (or
members, as the case may be) in funded, tax-qualified retirement benefit plans
maintained by CSX Corporation (the "Company") and certain of its affiliated
corporations (whose participation in the Supplemental Plan as a participating
employer is approved by the Board of Directors of any such affiliated
corporation and by the Compensation Committee of the Board of Directors of CSX
Corporation ("Compensation Committee")) and whose benefits would otherwise be
reduced by Section 415 of the Internal Revenue Code ("Code") of 1986, as amended
("Code") which imposes limitations on benefits ("Code Limitations").
2. Notwithstanding the limitations on benefits imposed by Code
Limitations, supplemental benefits shall be provided under this Supplemental
Plan equal to the reduction of benefits which shall occur as a result of the
application of limitations included in a defined contribution plan or in a
defined benefit plan in accordance with Code Limitations.
3. This Supplemental Plan preserves and continues in effect all
provisions for accruals based upon limitations of benefits imposed by Code
Limitations, heretofore credited to Participants under Section V, paragraph
(subsection) 5, of the Special Retirement Plan of CSX Corporation and Affiliated
Corporations ("Special Plan"), the Supplemental Benefits Plan of Sea-Land
Corporation and Participating Companies, and the American Commercial Lines
Benefit Restoration Plan ("Predecessor Plans").
Section II - DEFINITIONS
1. Supplemental Benefit means the benefit described in Section IV of
this Supplemental Plan.
2. The Supplemental Plan shall, where appropriate, refer to and have
meanings consistent with all of the relevant terms of the CSX Pension Plan and
any other regularly maintained funded, tax-qualified pension plan of any other
corporation affiliated with the Company whose participation in the Supplemental
Plan as a participating employer is approved by the Board of Directors of any
such affiliated corporation and by the Compensation Committee. Such existing
regularly maintained pension plans which provided benefits for employees of the
Company or its affiliates prior to the Effective Date of this Supplemental Plan
document, or those which may be established hereafter, as amended from time to
time, shall be referred to herein as the "Pension Plan."
3. Regardless of formal differences which may exist between the
Supplemental Plan and the Pension Plan or the Predecessor Plans in the use of
terminology, the definitions and principles which are set forth in the Pension
Plan or the Predecessor Plans with respect to compensation, average
compensation, credited service and similar terms shall be construed and applied
hereunder in a manner consistent with the purposes of this Supplemental Plan and
the Pension Plan or the Predecessor Plans. In any instance in which the male
gender is used herein, it shall also include persons of the female gender in
appropriate circumstances.
Section III - MEMBERSHIP
1. Every person who was a Participant in the Predecessor Plans for the
purpose of accruals of supplemental benefits heretofore notwithstanding
limitations of benefits imposed by Code Limitations, shall be a Participant in
this Supplemental Plan on and after the Effective Date.
2. Each employee who is a Participant in a Pension Plan on or after the
Effective Date shall participate in this Supplemental Plan to the extent of the
benefits provided herein.
3. A Participant's participation in this Supplemental Plan shall
terminate coincident with the termination of such individual's participation in
one of the Pension Plans; provided, however, in the event that the Participant
shall be reassigned or transferred into the employ of the Company or any of its
affiliates which also is a participating employer in this Supplemental Plan, the
Participant's participation shall be continued to the extent of the benefits
provided herein.
Section IV - SUPPLEMENTAL BENEFITS
1. All of the provisions, conditions and requirements set forth in the
Pension Plan with respect to the granting and payment of retirement benefits
thereunder shall be equally applicable to the payment of supplemental benefits
hereunder to Participants in the Supplemental Plan and to the payment thereof
from the employer's general assets. Whenever an individual Participant's rights
under the Supplemental Plan are to be determined, appropriate reference shall be
made to the particular Pension Plan in which such person is also a participant.
Notwithstanding the preceding sentence, if a supplemental benefit under this
Supplemental Plan shall be paid to a surviving spouse or other surviving
designated beneficiary in conformance with the provisions of the Pension Plans,
the final installment payment hereunder shall be made to the estate of the
surviving spouse or other surviving designated beneficiary.
2. Each Participant shall receive a Supplemental Benefit under this
Supplemental Plan in an amount equal to the difference, if any, between (i) the
Participant's monthly retirement income benefit under the provisions of the
particular Pension Plan in which such person is also a participant calculated
before the application of any Code Limitations and (ii) the Participant's
monthly retirement income benefit determined after application of the Code
Limitations.
3. Notwithstanding any other provision of this Supplemental Plan to the
contrary, a Supplemental Benefit shall not be determined or paid which would
duplicate a payment of benefit provided to a Participant under the Pension Plan,
the Predecessor Plans or any other unfunded or funded retirement plan of the
Company or any of its affiliated corporations.
4. A Supplemental Benefit payable under the provisions of this
Supplemental Plan shall be paid in such forms and at such times as shall be
consistent with the payment of the Participant's retirement income benefit under
the particular Pension Plan in which such person is also a participant.
Notwithstanding the foregoing, the Company may delay payment of a Supplemental
Benefit under the Supplemental Plan to any Participant who is determined to be
among the top five most highly paid executives for the year that the
Supplemental Benefit payment would otherwise be paid; provided, however, if a
Participant's payment is delayed, that will not decrease the total Supplemental
Benefit to which he is entitled.
Section V - FUNDING METHOD
1. The Supplemental Benefit shall be paid exclusively from the general
assets of the employers participating in the Supplemental Plan or from the CSX
Corporation Nonqualified Plan Trust or such other trust which will substantially
conform to the terms of the model trust as described in Revenue Procedure 92-64,
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1992-2 C.B.422, established by CSX Corporation to secure the obligations created
herein ("Trust"). No Participant or other person shall have any rights or claims
against the assets of the employers or against the Trust which are superior to
or different from the right or claim of a general, unsecured creditor of any
participating employer.
2. The Supplemental Plan is intended to be unfunded for tax purposes
and for purposes of Title I of ERISA, and constitutes a mere promise by the
participating employer to make benefit payments in the future.
3. The employers participating in the Supplemental Plan shall provide
all funds required for the administrative expenses of the Supplemental Plan.
Section VI - ADMINISTRATION OF PLAN
1. The Plan Administrator of the CSX Pension Plan shall be the "Plan
Administrator" of this Supplemental Plan and shall be responsible for the
general administration of the Supplemental Plan and for carrying out its
provisions. Administration of this Supplemental Plan shall be carried out
consistent with the terms and conditions of the Pension Plan and the
Supplemental Plan and the decision of the Plan Administrator shall be binding
and conclusive on Participants, their beneficiaries, heirs and assigns.
Section VII - CERTAIN RIGHTS AND OBLIGATIONS
1. The Compensation Committee may terminate the Supplemental Plan only
upon the occurrence of conditions which require the termination of one or more
of the Pension Plans. The Board of Directors of CSX Corporation may terminate an
affiliated corporation from participation as a participating employer for any
reason at any time. The Board of Directors of any affiliated corporation may
terminate that corporation's participation as a participating employer for any
reason at any time.
2. The participating employers agree in the event that the Supplemental
Plan is terminated:
(a) Each retired Participant, surviving spouse of a retired
Participant or surviving designated beneficiary of a retired
Participant shall be entitled to receive for life the
Supplemental Benefit they would have received had the
Supplemental Plan not been terminated, and each surviving
spouse or surviving designated beneficiary of a deceased
Participant shall become entitled to receive for life the
Supplemental Benefit that such surviving spouse or surviving
designated beneficiary would have received had the
Supplemental Plan not been terminated; and
(b) Each active Participant shall be entitled to receive for life
the Supplemental Benefit he or she would have received had the
Supplemental Plan not been terminated, calculated on the basis
of the Supplemental Benefit which had accrued at the time of
termination; provided, however, that the Participant shall
become entitled to such Supplemental Benefit only at the time
and in accordance with the provisions of the Supplemental Plan
had it continued in effect.
(c) In lieu of paying a Supplemental Benefit in accordance with
the foregoing provisions, the Plan Administrator, at its
election, may direct the discharge of all obligations to
retired Participants, surviving spouses or surviving
designated beneficiaries of deceased Participants, and active
Participants by cash payment of equivalent actuarial value or
through the provision of immediate or deferred annuities or
such other periodic payments of equivalent actuarial value, as
it shall in its sole discretion determine.
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3. Anything in the Supplemental Plan to the contrary notwithstanding,
if the Plan Administrator finds that any Participant, retired Participant or
spouse is engaged in acts detrimental to the Company or any of its affiliated
corporations, and if after due notice such Participant, the retired Participant
or spouse continues to be so engaged or employed, the Plan Administrator shall
suspend the Supplemental Benefit of such person, which suspension shall continue
until removed by notice from the Plan Administrator; provided, however, that if
such suspension has continued for one year, the Plan Administrator shall
forthwith cancel such Participant's or spouse's Supplemental Benefit.
Furthermore, if the Plan Administrator finds that any Participant had been
discharged for having performed acts detrimental to the Company or any of its
affiliated corporations, then regardless of any other provision in the Pension
Plan or the Supplemental Plan, no benefit shall be payable to or on account of
any such Participant's coverage under this Supplemental Plan.
4. The establishment of the Supplemental Plan shall not be construed as
conferring any legal rights upon any employee for a continuation of employment,
nor shall it interfere with the rights of an employing corporation to discharge
any employee and to treat him without regard to the effect which such treatment
might have upon him as a Participant in the Supplemental Plan.
Section VIII - NON-ALIENATION OF BENEFITS
To the extent permitted by applicable law, no benefit under the
Supplemental Plan shall be subject in any manner to anticipation, alienation,
sale, transfer, assignment, pledge, encumbrance, or charge, and any attempt so
to do shall be void, except as specifically provided in the Supplemental Plan,
nor shall any benefit be in any manner liable for or subject to the debts,
contracts, liabilities, engagements, or torts of the person entitled to such
benefits; and in the event that the Plan Administrator shall find that any
active or retired Participant, surviving spouse or surviving designated
beneficiary under the Supplemental Plan has become bankrupt or that any attempt
has been made to anticipate, alienate, sell, transfer, assign, pledge, encumber,
or charge any of his benefits under the Supplemental Plan, expect as
specifically provided in the Supplemental Plan, then such benefits shall cease,
and in that event, the Plan Administrator shall hold or apply the same to or for
the benefit of such active or retired Participant, surviving spouse or surviving
designated beneficiary, in such manner as the Plan Administrator may deem
proper.
Section IX - AMENDMENTS
The Supplemental Plan represents a contractual obligation entered into
by a participating employer in consideration of services rendered and to be
rendered by Participants covered under the Supplemental Plan, and
1. Any Participant in this Supplemental Plan who remains in the active
service of a participating employer shall not be deprived of his or her
participation or benefit which shall accrue under the Supplemental Plan except
as provided hereunder.
2. No modification or amendment may be made which shall deprive any
Participant, the surviving spouse of a Participant or the surviving designated
beneficiary of a Participant, without the consent of such Participant, surviving
spouse of a Participant or the surviving designated beneficiary of a
Participant, of any Supplemental Benefit under the Supplemental Plan to which he
or she would otherwise be entitled by reason of the Supplemental Benefit
standing to his or her credit to the date of such modification or amendment, and
in the event of any modification or amendment which adversely affects such
Supplemental Benefit, the amount of all reserves required to be accrued on the
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books of a participating employer shall thereupon be determined and accrued, if
the same has not already been done, and such Supplemental Benefit shall become
and remain a fixed liability of the participating employers for the payment of
such benefits accrued to the date of such modification or amendments.
3. Subject to the foregoing, the Compensation Committee reserves the
right at any time and from time to time to modify or amend in whole or in part
any or all of the provisions of this Plan.
Section X - CHANGE OF CONTROL
1. If a Change of Control has occurred, the Compensation Committee
shall cause the Company to contribute to the Trust within 7 days of such Change
of Control, a lump sum contribution equal to the greater of:
(a) the aggregate value of the amount each Participant would be
eligible to receive, under Subsection (2), below; or
(b) the present value of accumulated Plan benefits based on the
assumptions the Company's independent actuary deems reasonable
for this purpose, as of the Valuation Date, as defined in
subsection (6), below, coinciding with or next preceding the
date of Change of Control, to the extent such amounts are not
already in the Trust. The aggregate value of the amount of the
lump sum to be contributed to the Trust pursuant to this
Section X shall be determined by the Company's independent
actuaries. Thereafter, the Company's independent actuaries
shall annually determine as of a Valuation Date for each
Participant not receiving a lump sum payment pursuant to
subsection (2), below, the greater of:
(i) the amount such Participant would have received under
subsection (2) had such Participant not made the
election under subsection (3), below, if applicable;
and
(ii) the present value of accumulated benefits based on
assumptions the actuary deems reasonable for this
purpose. To the extent that the value of the assets
held in the Trust relating to this Supplemental Plan
does not equal the amount described in the preceding
sentence, at the time of the valuation, the Company
shall make a lump sum contribution to the Trust equal
to the difference.
2. In the event a Change of Control has occurred, the trustee of the
Trust shall, within 45 days of such Change of Control, page to each Participant
not making an election under subsection (3), a lump sum payment equal to the
actuarial present value of the aggregate supplemental benefit each Participant
(or any beneficiary of a Participant) has accrued as of the Valuation Date
preceding the date of such Change of Control. If a Participant's benefit has not
commenced as of such date, such lump sum shall be determined assuming that:
(a) The Participant's benefit would commence at the earliest date
he would qualify for early or normal retirement under the
Plan, were his employment with the Company to continue, but in
no event earlier than the later of age 55 or the date of such
Change of Control.
(b) The Participant would qualify for an early (or normal)
retirement benefit as of the date determined in (a).
(c) If married, the Participant would receive his benefit under
the 50% Joint and Survivor form of payment with the spouse as
beneficiary; if not married, the benefit would be payable in
the form of a single life annuity.
The actuarial present value shall be determined on the basis of the UP
1984 Mortality Table, set back one year, and a discount rate equal to the
interest rate promulgated by the Pension Benefit Guaranty Corporation for use in
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determining the sufficiency of single employer defined benefit pension plans
terminating on the date of such Change in Control.
3. Each Participant may elect in a time and manner determined by the
Compensation Committee but, in no event later than December 31, 1996, or the
occurrence of a Change of Control, if earlier, to have amounts and benefits
determined and payable under the terms of this Supplemental Plan as if a Change
of Control had not occurred. New Participants in the Plan may elect in a time
and manner determined by the Compensation Committee, but in no event later than
90 days after becoming a Participant, to have amounts and benefits determined
and payable under the terms of this Supplemental Plan as if a Change of Control
had not occurred. A Participant who has made an election, as set forth in the
two preceding sentences, may, at any time and from time to time, change that
election; provided, however, a change of election that is made within one year
of a Change of Control shall be invalid.
4. Notwithstanding anything in this Supplemental Plan to the contrary,
each Participant who has made an election under subsection (3), above, may elect
within 90 days following a Change of Control, in a time and manner determined by
the Compensation Committee, to receive a lump sum payment calculated under the
provisions of subsection (2), above, determined as of the Valuation Date next
preceding such payment, except that such amount shall be reduced by 5% and such
reduction shall be irrevocably forfeited to the Company by the Participant.
Furthermore, as a result of such election, the Participant shall no longer be
eligible to participate or otherwise benefit under the Supplemental Plan.
Payments under this subsection (4) shall be made not later than 7 days following
receipt by the Company of the Participant's election. The Compensation Committee
shall, no later than 7 days after a Change of Control has occurred, cause
written notification to be given to each Participant eligible to make an
election under this subsection (4), that a Change of Control has occurred and
informing such Participant of the availability of the election.
5. As used in this Section X, a "Change of Control" shall mean:
(a) 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 (i) the then outstanding shares of
common stock of the Company (the "Outstanding Company Common
Stock"), or (ii) 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 (a), the following acquisitions
shall not constitute a Change of Control: (i) any acquisition
directly from the Company; (ii) any acquisition by the
Company; (iii) any acquisition by any employee benefit plan
(or related trust) sponsored or maintained by the Company or
any corporation controlled by the Company; or (iv) any
acquisition by any corporation pursuant to a transaction which
complies with clauses (i), (ii) and (iii) of subsection (c) of
this Section X(5); or
(b) 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
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considered as though such individual were a member of the
Incumbent Board, but excluding, for this purpose, any such
individuals 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
(c) Business Combination. Approval by the shareholders of the
Company of a reorganization, merger or 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
Interstate Commerce Commission 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:
(i) 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 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;
(ii) 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
(iii) 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
(d) 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 (i), (ii) and (iii) of
subsection (c) of this Section X(5); or
(e) Liquidation or Dissolution. Approval by the shareholders of
the Company of a complete liquidation or dissolution of the
Company or its principal subsidiary.
6. For purposes of this Section X, the term "Valuation Date" means the
last day of each calendar year and such other dates as the Plan Administrator
deems necessary or appropriate to value the Participants' benefits under this
Supplemental Plan.
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Section XI - CONSTRUCTION
The Supplemental Plan and the rights and obligations of the parties
hereunder shall be construed in accordance with the laws of the Commonwealth of
Virginia.
Section XII - EFFECTIVE DATE
The Effective Date of this Supplemental Benefit Plan shall be January
1, 1989.