North Carolina and CSX: Partnering to deliver economic opportunity

Executive Summary

CSX is a Fortune 250 company with a record of success— Leading North American transportation company with strong eastern network

CSX is redefining logistics/distribution networks— Enhancing competiveness of U.S. businesses, while providing public benefits,

such as reduced highway congestion and cleaner air

North Carolina and CSX have partnered for 150+ years— CSX is eager to play an even larger role in N.C. economy in the coming years

New $272M investment in N.C.’s critical infrastructure is

transformational opportunity— This state-of-the-art facility would improve North Carolina’s economic

competitiveness and bring over 1,500 jobs to the state

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CSX is a premier transportation company

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Company Profile

Revenue* $11.8B

Capital Investment** $2.4B

Miles of Track 21,000 miles

Employees 28,000

500+ trains online at any point in time

*2015

**2016 projected

CSX Rail Network and Major Terminals

A partnership spanning 150+ years

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Serving N.C. since the mid-

1830’s

Nearly a dozen CSX facilities in

the state including a hump yard

and a major flat switching yard

10,000 carloads through Port of

Wilmington

Company Profile in N.C. (2015)

Capital Investment $47.9M

Miles of Track 1,800 miles

Customers Served 450+

Employees 1,050

Business diversified across broad market base

2015 Volume by Market: 6.9 Million Rail Car Loads

Merchandise: 42%(Agriculture, Construction &

Industrial)

Intermodal: 41%(Domestic & International)

Coal: 17%(Domestic & Export)

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Coal market decline driven by natural gas prices

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$3.5

$3.0 $2.7 $2.7

$2.2 1.5

1.3 1.2 1.3

1.1

2011 2012 2013 2014 2015

Revenue in Billions Carloads in Millions

Coal Revenue and Volume

Source: Global Insight Economic Forecast January 2016

$1.5

$2.5

$3.5

$4.5

$5.5

2011 2012 2013 2014 2015 2016

Henry Hub Natural Gas Prices$ / mm BTU

$35

$55

$75

$95

$115

$135

2011 2012 2013 2014 2015 2016

Thermal Spot Prices (API2)$ / ton

Merchandise improves amidst mixed indicators

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Merchandise Revenue and Volume

$5.7 $6.0 $6.4

$6.9 $7.0

2.7 2.7 2.82.9 2.9

2011 2012 2013 2014 2015

Revenue in Billions Carloads in Millions

Source: Global Insight Economic Forecast January 2016; U.S. Dollar Inflation adjusted Broad Index

3.00

3.50

4.00

4.50

5.00

2011 2012 2013 2014 2015 2016

NALVPMillions of Vehicles per Quarter

0.80

0.85

0.90

0.95

1.00

1.05

1.10

2011 2012 2013 2014 2015 2016

Iron & Steel Production IndexJan. `11 = 1.00

Future of logistics moving from highway to rail (H2R)

75

100

125

150

175

200

225

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Indexed: January 2006 = 100ATA Truck Tonnage CSX Average Weekly Domestic Intermodal Volume

Source: CSX Corporation and ATA

Domestic Intermodal Volume versus ATA Truck Tonnage

Up

~120%

Up

~15%

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Intermodal benefits from truck conversions, rising GDP

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Intermodal Revenue and Volume

$1.2 $1.3

$1.4 $1.5

$1.6

2.32.5

2.62.7

2.8

2011 2012 2013 2014 2015

Revenue in Billions Containers in Millions

Economic DriversQuarterly Index, Q1 2011 = 100

Source: IHS Global Insight, International Monetary Fund; Fed. Reserve

80

85

90

95

100

105

110

115

2011 2012 2013 2014 2015 2016

Import Price Index GDP

Intermodal transforming movement of goods

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Intermodal offers national transportation solutions

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The most environmentally friendly

mode of land transportation— One ton of freight moves 483

miles on a single gallon of fuel

Reduces highway congestion— Each train can take up to 280

trucks off the road

Enhances competitiveness of

U.S. companies— Up to 40% savings when

converting from truck to rail

Addresses ongoing challenges in

trucking industry

NorfolkSt Louis

Memphis

Philadelphia

Wilmington

Chicago

Baltimore

Tampa

MobileNew Orleans

Jacksonville

SavannahCharleston

NY/NJ

Boston

Gulf Coast

Midwest

Montreal

Northeast

PiedmontAtlantic

Montreal

NW Ohio hub enhances network connectivity

Hub and spoke coupled with

corridor lanes key differentiator

— Does for freight what Charlotte

does for American Airlines

Innovative approach plus superior

service has proven successful

— Over 200 new markets served

(e.g. Montreal and Pittsburgh)

— NW Ohio has driven 25% of

Intermodal growth since 2011

Competitive advantage for

manufacturing and distribution

centers near facility

— E.g. Whirlpool, Campbell’s Soup

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CCX positions N.C. for future success

Carolina Connector (CCX) adds

second hub to Intermodal network

CCX will serve rapidly growing

Raleigh metro market and N.C.

ports

Total estimated investment of

$272 million— Innovative state funding program

essential to enabling investment

Most state-of-the-art rail terminal

in the world— Zero emission electric cranes

— “X-gate” reduces truck idling

Philadelphia

St. Louis

Montreal

Northwest Ohio

Jacksonville

South FloridaNew Orleans

Mobile

Charlotte

Atlanta

Nashville

Memphis

Chicago

Portsmouth

Carolina

Connector

Hub and Spoke Network

Technology transforming logistics efficiencies

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CCX could be a “game changer” for North Carolina

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Existing Business Cheaper, more efficient access to global markets enhances

competitiveness for existing N.C. businesses and ports

New Business

Terminal will attract warehousing and distribution centers

Cheaper, more efficient access to global markets will help

attract new businesses

Other

Public/Economic

Benefits

1,500+ jobs statewide over time

Reduced traffic congestion from 272K trucks off N.C. roads

Reduced emissions equivalent to removing nearly 1B

passenger car miles

Wrap-up

CSX has built a track record of investing sustainably in

infrastructure and communities

CCX hub would further strengthen partnership between

the state and CSX

Intermodal enables greater market reach for North

Carolina businesses

CCX would improve the state’s economy and quality of

life for North Carolinians

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North Carolina and CSX: Partnering to deliver economic opportunity