Pay fell for top executives at Norfolk Southern in 2010

NORFOLK

All seven of Norfolk Southern Corp.'s top executives took pay reductions last year, according to the company's proxy statement released this week.

The total compensation package for Wick Moorman, the railroad's chairman, president and CEO, fell about 14.1 percent to nearly $11 million from about $12.7 million in 2009.

The Norfolk-based company's total pay calculation for its top executives includes salary, performance-based bonuses and stock and option awards, as well as "change in pension value and nonqualified deferred compensation earnings."

Last year, Norfolk Southern's net income was nearly $1.5 billion, up from $1 billion in 2009 - a nearly 45 percent increase. In its 2010 annual report, it said it was the company's second best year ever for earnings.

Compensation for the company's executives is set by two board committees. Among the factors considered are comparative market data from other similar-sized companies and other Class 1 railroads, prior salaries, targeted bonus opportunities and "expected corporate performance and general economic conditions."

Pay for the seven executives fell largely because of declines in the value of stock and option awards compared with 2009.

While overall pay packages dipped, performance-based bonuses rebounded after sliding by more than half between 2008 and 2009.

Moorman's rose 92.6 percent to $1.18 million, while the other six received $388,750 each. All six are executive vice presidents overseeing different aspects of the railroad's business.

Moorman's perquisites last year included personal use of corporate aircraft valued at $48,988, annual physicals worth $3,800 and meals and travel for his spouse or guests of $1,848.

Norfolk Southern requires its top executive and his family and guests to use the company plane "whenever reasonably possible for air travel," the proxy states.

The company is the middle of a transition to electing its directors every year at the annual meeting, which will be held this year at 10 a.m. May 12 at the Williamsburg Lodge in Williamsburg.

The terms of four of its directors - former Virginia Gov. Gerald L. Baliles, Erskine B. Bowles, Karen N. Horn and retired Navy Adm. J. Paul Reason - will expire at this meeting. All four are up for election to new one-year terms, according to the proxy statement.

Two directors, Landon Hilliard and Gene Carter will retire, effective the date of the meeting, and won't be replaced.

Robert McCabe, (757) 446-2327, robert.mccabe@pilotonline.com