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Post Info TOPIC: CSX Issues Statement Regarding TCI


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CSX Issues Statement Regarding TCI
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spacer.gifCSX issues statement regarding TCI Group letter

(CSX issued the following on July 22.)

JACKSONVILLE, Fla. CSX today issued the following statement in response to a letter sent by the TCI Group to the CSX Board of Directors:

The Company believes that three points are worth making.

First, vote counts in contested elections always take time. The time period for this review is not unusual. The value of the process has been proved in the fact that the process has already identified errors in the preliminary report, which have been confirmed by the independent inspector of election. The review continues in good faith.

Second, the uncertainty in the vote count is significant enough to matter to the ultimate composition of the Board.

Third, the letter misstates the record in the litigation. The U.S. District Court did not flatly refuse to sterilize the votes. The U.S. District Court made clear that if the law were more certain, it would prevent the TCI Group's voting of 6.4 percent of the outstanding shares of CSX. Recognizing the importance of the issues, the Appellate Court agreed to hear the appeal on an expedited basis. The one thing that was certain in the litigation is that the U.S. District Court found the TCI Group had violated the securities laws with respect to its activities in CSX stock. This finding compels the CSX Board to continue to proceed with diligence as it discharges its duties fully with respect to this election.

CSX will proceed quickly and continue to keep open the lines of communication with respect to the status. Whatever the ultimate outcome, the CSX Board will work constructively to continue providing outstanding value for shareholders.

The Company noted that, in addition to the customary review and challenge period, the voting results are subject to the outcome of pending litigation between the Company and the TCI Group before the U.S. Court of Appeals for the Second Circuit.

About CSX

CSX Corporation, based in Jacksonville, Fla., is one of the nation's leading transportation companies, providing rail, intermodal and rail-to-truck trainload services. The company's transportation network spans approximately 21,000 miles, with service to 23 eastern states and the District of Columbia, and connects to more than 70 ocean, river and lake ports. More information about CSX Corporation and its subsidiaries is available at the company's web site, www.csx.com.

Wednesday, July 23, 2008



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spacer.gifTCI, 3G Capital send letter to CSX Board of Directors

(TCI and 3G Capital issued the following on July 22.)

NEW YORK The Children's Investment Fund Management (UK) LLP ("TCI") and 3G Capital Partners, Ltd. ("3G") today sent the following letter to the Board of Directors of CSX Corp.

July 22, 2008

Board of Directors
CSX Corporation
500 Water Street
Jacksonville, FL 32202

Dear Board of Directors:

We are writing to reiterate our desire to work constructively with the Board of Directors for the benefit of all CSX shareholders. Accordingly, we are deeply dismayed that the Company continues to go to extraordinary lengths to thwart the clear choice made by CSX shareholders to elect four of our nominees to the Board of Directors.
It was clear to us, as we announced on the day of the annual meeting, that shareholders had elected four of our nominees. After several weeks of work conducted by the independent inspector of elections (chosen and retained by CSX), the independent inspector came to the same conclusion, as CSX announced last week. After a further five consecutive days of continuous review conducted by CSX's lawyers and proxy advisor, while there have been de minimis changes to the vote totals, the inspector's updated tallies have confirmed that the outcome of the election has not changed - CSX shareholders elected four of our nominees.

Today is the sixth day of review, and we are told that CSX is still seeking to find up to 122,229 "lost votes" despite the fact that this number of votes would not change the outcome of the election. Further, CSX has not told us how many more days of review it wants. However, during this same review period (the past five days) our advisors already have reviewed all votes cast by shareholders at the annual meeting. Based on this review, we see no legitimate challenges to the tally that could possibly change the previously reported outcome of the election. However, in case CSX does wish to question the tally, we are prepared to immediately begin a challenge period, which is the final step before the election results can be certified. But CSX has declined our offer to do this. The implication is that the certification of the vote and seating of our duly elected directors will not occur as scheduled this Friday, July 25th, but rather is being delayed even further.

Our concern over CSX's unwillingness to accept and respect the expressed will of its shareholders is heightened by comments made by CSX's legal advisors (to us) and Michael Ward (publicly) that CSX may not seat some of our directors until the litigation appeal process has concluded, which likely will not be before September at the earliest.

We do not understand how repeatedly seeking judicial "sterilization" of our shares is in the best interest of shareholders. Further we do not understand how CSX can justify not seating legitimately elected directors on this basis. The shareholders have the right to elect the directors, and the law mandates elected directors are seated upon certification. These are not choices or judgments to be made by the incumbent board. For CSX to unilaterally take the very action that two courts on three occasions have denied it, and refuse to seat elected directors, would be an affront to all shareholders, and illegal.

We urge CSX to refrain from taking further steps to delay the inevitable outcome of this election. The shareholders have decided which directors they want to represent their interests. The votes have been counted and the outcome is clear - the shareholders want our four nominees on the CSX Board. We don't want to litigate this issue but will take all necessary actions to protect shareholder interests if the duly elected board is not immediately seated.

While we understand that losing a contested election is not easy for an incumbent board to accept, it is time to put the "contest" behind us, and move forward to work together constructively on the Board. There is a lot of work to be done to make CSX the best railroad in America, and we hope you agree that is where our collective focus and resources should be guided.
Sincerely,

/s/ Christopher Hohn /s/ Alex Behring

Christopher Hohn
Managing Partner, TCI

Alex Behring
Managing Director, 3G Capital

Wednesday, July 23, 2008



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