CSX CORPORATION (NASDAQ:CSX) Files An 8-K Entry into a Material Definitive Agreement

Item1.01.

Entry into a Material Definitive Agreement.

On March 6, 2017, CSX Corporation (the Company) and MR
Agent Advisor LLC (Mantle Ridge), on behalf of itself and
its affiliated funds (such funds, together with Mantle Ridge,
collectively, the Mantle Ridge Group) entered into a
letter agreement (the Letter Agreement). The Mantle Ridge
Group owns approximately 4.9% of the outstanding shares of common
stock of the Company, par value $1.00 per share (the Common
Stock).

The Letter Agreement provides that the Board of Directors of the
Company (the Board) will accept Mr. Michael J. Wards
resignation as Chief Executive Officer of the Company, and Mr. E.
Hunter Harrison will be appointed as the Chief Executive Officer
of the Company, effective immediately. Under the Letter
Agreement, Mr. Ward will assume the title of consultant and
retire from the Company as of May 31, 2017.

The Letter Agreement also provides for the appointments of Mr.
Harrison, Paul C. Hilal, Dennis H. Reilley, Linda H. Riefler and
John J. Zillmer (collectively, the New Directors) to the
Board, effective immediately, and the subsequent nomination of
the New Directors, together with incumbent directors Donna M.
Alvarado, John B. Breaux, Pamela L. Carter, Steven T. Halverson,
Edward J. Kelly, III, John D. McPherson, David M. Moffett and J.
Steven Whisler, at each of the Companys 2017 annual meeting of
shareholders (the 2017 Annual Meeting) and 2018 annual
meeting of shareholders (the 2018 Annual Meeting). Mr.
Hilal is the managing member of Mantle Ridge GP LLC, which is the
general partner of Mantle Ridge LP, which is the sole member of
Mantle Ridge, and holds less than 1% economic interest in the
funds of Mantle Ridge.

to the Letter Agreement, if any of the New Directors is unable to
serve as a member of the Board, the Mantle Ridge Group will have
the right to have another individual appointed to the Board who
is reasonably acceptable to the Governance Committee of the Board
and who meets the director independence and other standards of
The NASDAQ Stock Market LLC and the Securities and Exchange
Commission, subject to certain other conditions. The Company has
also agreed that until the conclusion of the 2018 Annual Meeting,
the size of the Board will not be more than thirteen directors.

Under the Letter Agreement, the Company has agreed that Mr.
Harrison will be appointed to the Executive Committee of the
Board, Mr. Hilal will be appointed to the Compensation,
Executive, Governance and Finance Committees of the Board, Mr.
Reilley will be appointed to the Audit, Executive, Governance and
Finance Committees of the Board, Ms. Riefler will be appointed to
the Audit, Compensation and Public Affairs Committees of the
Board and Mr. Zillmer will be appointed to the Compensation,
Executive, Governance and Public Affairs Committees of the Board,
in each case effective immediately.

to the Letter Agreement, the Company will amend its Corporate
Governance Guidelines to provide for the separation of the roles
of Chief Executive Officer and Chairman of the Board, the
existence of a non-executive Chairman of the Board and the
addition of the role of Vice Chairman of the Board. The Letter
Agreement also provides for the amendment of the Companys Amended
and Restated Bylaws (the Bylaws) to reflect such changes
in the structure of the Board, provide that a director that has
reached the retirement age of 75 years set forth in the Bylaws
may continue to serve on the Board so long as he or she has not
served more than five consecutive terms and provide that an
amendment of the Bylaws will require a vote of two-thirds of the
directors then in office.

The Letter Agreement provides that Mr. Kelly will be appointed as
the Chairman of the Board and Mr. Hilal will be appointed as the
Vice Chairman of the Board, in each case effective immediately,
and that the Company will maintain such appointments until the
conclusion of the 2018 Annual Meeting; provided that the Mantle
Ridge Group will cause the resignation of Mr. Hilal from the
Board in the event that the Mantle Ridge Groups beneficial
ownership of outstanding shares of Common Stock is less than 2.0%
(the Minimum Ownership Requirement).

In addition, the Company has agreed to include in its proxy
statement and proxy card relating to the 2017 Annual Meeting
(which the Company has agreed will be held no later than June 15,
2017) a proposal concerning reimbursement arrangements with
regard to certain compensation and benefits that Mr. Harrison had
forfeited as a result of his separation from Canadian Pacific
Railway Limited (the Make-Whole Benefits). The Company has
also agreed to make a determination on whether it will assume the
Make-Whole Benefits within 15 days of the 2017 Annual Meeting. If
the Company determines to assume the Make-Whole Benefits, within
five days of such determination, it will (i) pay $55,000,000 to
Mantle Ridge and (ii) agree in writing with Mr. Harrison to pay
Mr. Harrison $29,000,000 on or before March 15, 2018 and assume a
tax indemnity.

The Mantle Ridge Group has agreed to cause all shares of Common
Stock owned of record or beneficially by the Mantle Ridge Group
to be voted in favor of all nominees of the Company in its proxy
statement for the 2017 Annual Meeting.

Each of the Mantle Ridge Group and the Company have agreed,
subject to certain exceptions including for factual statements,
not to make or cause to be made any statement or announcement
that constitutes an ad hominem attack on, or disparages,
the other party or any of its officers, directors, advisory board
members or employees.

The Letter Agreement contains various other obligations and
provisions applicable to the Company and the Mantle Ridge Group.

The obligations under the Letter Agreement will terminate upon
the conclusion of the 2018 Annual Meeting, subject to certain
specified obligations that will terminate at a later date;
provided that the Mantle Ridge Groups right to replace the New
Directors will terminate upon the Mantle Ridge Group ceasing to
satisfy the Minimum Ownership Requirement.

The above summary is qualified in its entirety by reference to
the full text of the Letter Agreement, a copy of which is
attached hereto as Exhibit 10.1 and is incorporated by reference
herein.

Item5.02.

Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

The disclosure in Item 1.01 of this Current Report on Form 8-K is
incorporated by reference herein. In connection with the
appointment of the New Directors to the Board, the New Directors
(other than Mr. Harrison) became eligible to participate in the
Companys non-employee director compensation program, including
receiving annual grants of shares of Common Stock with the number
of such shares determined based on the average closing price of
the Companys shares during December of 2016 and January and
February of 2017, pro-rated to reflect their appointment to the
Board in March of 2017.

On March 6, 2017, Mr. Ward resigned from his positions as the
Chief Executive Officer of the Company and a director of the
Company, effective immediately, and Timothy T. OToole resigned
from his position as a director of the Company, effective
immediately. There are no disagreements between either Mr. Ward
or Mr. OToole and the Company relating to matters concerning the
Companys operations, policies or practices.

On March 6, 2017, Clarence W. Gooden resigned from his position
as Vice Chairman of the Company, effective immediately.

On March 6, 2017, Mr. Harrison, age 72, was appointed as Chief
Executive Officer of the Company and a director of the Company,
effective immediately. There are no family relationships between
Mr. Harrison and any director or executive officer of the
Company. Mr. Harrison served as the President and Chief Executive
Officer of Canadian Pacific Railway Limited and Canadian Pacific
Railway Company (CP), a provider of rail and intermodal
freight transportation services, from 2012 to January 2017 during
which time he was also a member of the board of directors of CP.
CP is not a parent, subsidiary or other affiliate of the Company.
In addition, Mr. Harrison served on the board of directors of
Foresight Energy LP, whose business is to mine and market coal
from reserves and operations located exclusively in the Illinois
Basin, from 2014 to 2015. Mr. Harrison is a party to a consulting
agreement with Mantle Ridge to which Mr. Harrison agreed to,
among other things, serve as a Board nominee.

In connection with Mr. Harrison’s appointment as Chief Executive
Officer, the Company has entered into a four-year employment
agreement with Mr. Harrison providing Mr. Harrison with an annual
base salary of $2,200,000 and an annual target bonus opportunity
of $2,800,000, with a guaranteed 2017 bonus no less than the
target bonus opportunity. If Mr. Harrisons employment is
terminated by the Company without cause or by Mr. Harrison for
good reason or due to the Companys failure to assume the
Make-Whole Benefits he will be entitled to severance equal to his
base salary and target annual bonus, a pro rata bonus for the
year of termination and specified medical benefit continuation
rights. If the termination occurs in connection with, or within
two years following, a future change in control of the Company,
the severance will be 2.99 times Mr. Harrisons base salary and
target annual bonus. If, as a result of the Companys business
activities, Mr. Harrison is subject to any claims by CP under Mr.
Harrisons non-competition agreement with CP, the Company will
indemnify Mr. Harrison.

Mr. Harrison has been granted an option to purchase 9,000,000
shares of Common Stock at $49.79 (the closing price as of his
hire date) with a ten-year term. This option will vest in equal
annual installments over his four-year employment term. Half of
the option will vest based on continued service and half will
vest based on achievement of performance targets. If Mr.
Harrisons employment is terminated by the Company without cause
or by Mr. Harrison for good reason, the option will be eligible
to vest in full, subject to achievement of the applicable
performance targets in the case of the performance-vesting
portion of the option award. In other termination scenarios the
option will be subject to partial vesting. In the event of a
termination for cause, the option will be forfeited in full.

Item5.03.

Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.

On March 6, 2017, the Board approved amendments to the Bylaws,
effective immediately, to:

reflect the separation of the roles of Chief Executive Officer of the Company and Chairman of the Board and the addition of the role of Vice Chairman of the Board;

provide that a director shall be eligible for reelection to the Board even if he or she shall have reached the age of 75 years at the time of such reelection, if the reelection will not result in such director serving more than five consecutive terms; and

provide that the Bylaws may be amended by the Board only by the vote of at least two-thirds of the directors then in office instead of by the vote of a majority of the directors present.

The above summary is qualified in its entirety by reference to
the full text of the Bylaws, a copy of which is attached hereto
as Exhibit 3.1 and is incorporated by reference herein.

Item 8.01.

Other Events.

On March 6, 2017, the Company issued a press release regarding
certain of the matters described under Item 1.01 of this Current
Report on Form 8-K and the cancellation of the previously
convened special meeting of shareholders. A copy of the press
release is attached hereto as Exhibit 99.1 and is incorporated by
reference herein.

Forward-Looking Statements This information and
other statements by CSX may contain forward-looking statements
within the meaning of the Private Securities Litigation Reform
Act with respect to, among other items: projections and estimates
of earnings, revenues, margins, volumes, rates, cost-savings,
expenses, taxes, liquidity, capital expenditures, dividends,
share repurchases or other financial items, statements of
managements plans, strategies and objectives for future
operations, and managements expectations as to future performance
and operations and the time by which objectives will be achieved,
statements concerning proposed new services, and statements
regarding future economic, industry or market conditions or
performance. Forward-looking statements are typically identified
by words or phrases such as will, should, believe, expect,
anticipate, project, estimate, preliminary and similar
expressions. Forward-looking statements speak only as of the date
they are made, and CSX undertakes no obligation to update or
revise any forward-looking statement. If CSX updates any
forward-looking statement, no inference should be drawn that CSX
will make additional updates with respect to that statement or
any other forward-looking statements.

Forward-looking statements are subject to a number of risks and
uncertainties, and actual performance or results could differ
materially from that anticipated by any forward-looking
statements. Factors that may cause actual results to differ
materially from those contemplated by any forward-looking
statements include, among others: (i) CSXs success in
implementing its financial and operational initiatives; (ii)
changes in domestic or international economic, political or
business conditions, including those affecting the transportation
industry (such as the impact of industry competition, conditions,
performance and consolidation); (iii) legislative or regulatory
changes; (iv) the inherent business risks associated with safety
and security; (v) the outcome of claims and litigation involving
or affecting CSX; (vi) natural events such as severe weather
conditions or pandemic health crises; and (vii) the inherent
uncertainty associated with projecting economic and business
conditions.

ADDITIONAL INFORMATION AND WHERE TO FIND IT CSX
Corporation (CSX) will file a proxy statement with the U.S.
Securities and Exchange Commission (the SEC) with respect to the
annual meeting of shareholders. CSX SHAREHOLDERS ARE STRONGLY
ENCOURAGED TO READ SUCH PROXY STATEMENT, THE ACCOMPANYING PROXY
CARD AND OTHER DOCUMENTS FILED WITH THE SEC CAREFULLY IN THEIR
ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN
IMPORTANT INFORMATION. CSX, its directors, executive officers and
other employees may be deemed to be participants in the
solicitation of proxies from CSX shareholders in connection with
the matters to be considered at the annual meeting, or any
adjournment or postponement thereof. Information about certain
CSX directors and executive officers, and their direct and
indirect interests in CSX, is available in CSXs proxy statement,
filed March 28, 2016 for its 2016 Annual Meeting. To the extent
holdings of CSXs securities by such directors or executive
officers have changed since the amounts included in the 2016
proxy statement, such changes have been or will be reflected on
reports filed with the SEC in accordance with the reporting
requirements of Section 16 of the Securities Exchange Act of
1934, as amended. Additional information regarding directors and
executive officers appointed since March 28, 2016 and the
identity of potential participants, and their direct or indirect
interests, by security holdings or otherwise, will be set forth
in the proxy statement and other materials to be filed with the
SEC in connection with the annual meeting. Shareholders will be
able to obtain any proxy statement, any amendments or supplements
to any proxy statement and other documents filed by CSX with the
SEC free of charge at the SECs website at www.sec.gov. Copies
also will be available free of charge at CSXs website at
www.csx.com or by contacting CSX Investor Relations at (904)
359-4812.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

	3.1	Amended and Restated Bylaws, effective as of March 6, 2017.
	10.1	Letter Agreement, dated as of March 6, 2017, between CSX Corporation and MR Argent Advisor LLC.
	99.1	Press Release, dated March 6, 2017.

About CSX CORPORATION  (NASDAQ:CSX)

CSX Corporation is a transportation company. The Company provides rail-based freight transportation services, including traditional rail service and transport of intermodal containers and trailers, as well as other transportation services, such as rail-to-truck transfers and bulk commodity operations. The Company categorizes its products into three primary lines of business: merchandise, intermodal and coal. The Company’s intermodal business links customers to railroads through trucks and terminals. The Company’s merchandise business consists of shipments in markets, such as agricultural and food products, fertilizers, chemicals, automotive, metals and equipment, minerals and forest products. The Company’s coal business transports domestic coal, coke and iron ore to electricity-generating power plants, steel manufacturers and industrial plants, as well as export coal to deep-water port facilities.

CSX CORPORATION  (NASDAQ:CSX) Recent Trading Information

CSX CORPORATION  (NASDAQ:CSX) closed its last trading session down -1.35 at 48.44 with 17,895,487 shares trading hands.