10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2023

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to___________

Commission File Number: 1-8339

NORFOLK SOUTHERN CORPORATION

(Exact name of registrant as specified in its charter)

Virginia	52-1188014
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)		650 West Peachtree Street NW		30308-1925
---	---	---
Atlanta,	Georgia
(Address of principal executive offices)		(Zip Code)
(855)		667-3655
(Registrant’s telephone number, including area code)				No change
---
(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange on which registered
Norfolk Southern Corporation Common Stock (Par Value $1.00)	NSC	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☒ Accelerated filer ☐ Non-accelerated filer ☐ Smaller reporting company ☐ Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Class	Outstanding at March 31, 2023
Common Stock ($1.00 par value per share)	227,639,602	(excluding 20,320,777 shares held by the registrant’s
	consolidated subsidiaries)

NORFOLK SOUTHERN CORPORATION AND SUBSIDIARIES

		Page
Part I.	Financial Information:
	Item 1.	Financial Statements:
		Consolidated Statements of Income<br><br>FirstQuarterof 2023and 2022	3
		Consolidated Statements of Comprehensive Income<br><br>FirstQuarterof 2023and 2022	4
		Consolidated Balance Sheets<br><br>AtMarch31, 2023and December 31, 2022	5
		Consolidated Statements of Cash Flows<br><br>FirstThree Months of 2023and 2022	6
		Consolidated Statements of Changes in Stockholders’ Equity<br><br>FirstQuarterof 2023and 2022	7
		Notes to Consolidated Financial Statements	8
	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21
	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	31
	Item 4.	Controls and Procedures	31
Part II.	Other Information:
	Item 1.	Legal Proceedings	32
	Item 1A.	Risk Factors	32
	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	33
	Item 3.	Defaults Upon Senior Securities	33
	Item 4.	Mine Safety Disclosures	33
	Item 5.	Other Information	33
	Item 6.	Exhibits	34
		Signatures	35

Item 1. Financial Statements

Norfolk Southern Corporation and Subsidiaries

Consolidated Statements of Income

(Unaudited)

	First Quarter
	2023	2022
	( in millions, except per share amounts)
Railway operating revenues		$	2,915
Railway operating expenses
Compensation and benefits	690	619
Purchased services and rents	496	437
Fuel	315	301
Depreciation	321	302
Materials and other	212	171
Eastern Ohio incident	387	—
Total railway operating expenses	2,421	1,830
Income from railway operations	711	1,085
Other income (expense) – net	56	(5)
Interest expense on debt	175	168
Income before income taxes	592	912
Income taxes	126	209
Net income		$	703
Earnings per share
Basic		$	2.94
Diluted	2.04	2.93

All values are in US Dollars.

See accompanying notes to consolidated financial statements.

Norfolk Southern Corporation and Subsidiaries

Consolidated Statements of Comprehensive Income

(Unaudited)

	First Quarter
	2023	2022
	( in millions)
Net income		$	703
Other comprehensive income (loss), before tax:
Pension and other postretirement benefit (expense)	(5)	6
Other comprehensive income (loss) of equity investees	(1)	6
Other comprehensive income (loss), before tax	(6)	12
Income tax benefit (expense) related to items of other
comprehensive income (loss)	2	(4)
Other comprehensive income (loss), net of tax	(4)	8
Total comprehensive income		$	711

All values are in US Dollars.

See accompanying notes to consolidated financial statements.

Norfolk Southern Corporation and Subsidiaries

Consolidated Balance Sheets

(Unaudited)

	December 31,<br>2022

Assets
Current assets:
Cash and cash equivalents	$	456
Accounts receivable – net	1,148
Materials and supplies	253
Other current assets	150
Total current assets	2,007
Investments	3,694
Properties less accumulated depreciation of 12,810
and 12,592, respectively	32,156
Other assets	1,028
Total assets	$	38,885
Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	1,293
Short-term debt	100
Income and other taxes	312
Other current liabilities	341
Current maturities of long-term debt	603
Total current liabilities	2,649
Long-term debt	14,479
Other liabilities	1,759
Deferred income taxes	7,265
Total liabilities	26,152
Stockholders’ equity:
Common stock 1.00 per share par value, 1,350,000,000 shares
authorized; outstanding 227,639,602 and 228,076,415 shares,
respectively, net of treasury shares	230
Additional paid-in capital	2,157
Accumulated other comprehensive loss	(351)
Retained income	10,697
Total stockholders’ equity	12,733
Total liabilities and stockholders’ equity	$	38,885

All values are in US Dollars.

See accompanying notes to consolidated financial statements.

Norfolk Southern Corporation and Subsidiaries

Consolidated Statements of Cash Flows

(Unaudited)

		First Three Months
		2023	2022
		( in millions)
Cash flows from operating activities
	Net income		$	703
	Reconciliation of net income to net cash provided by operating activities:
	Depreciation	321	302
	Deferred income taxes	(15)	48
	Gains and losses on properties	(4)	(6)
	Changes in assets and liabilities affecting operations:
	Accounts receivable	(22)	(94)
	Materials and supplies	(9)	(46)
	Other current assets	12	21
	Current liabilities other than debt	480	83
	Other – net	(56)	(17)
	Net cash provided by operating activities	1,173	994
Cash flows from investing activities
	Property additions	(428)	(389)
	Property sales and other transactions	20	36
	Investment purchases	—	(1)
	Investment sales and other transactions	17	19
	Net cash used in investing activities	(391)	(335)
Cash flows from financing activities
	Dividends	(307)	(297)
	Common stock transactions	(10)	(18)
	Purchase and retirement of common stock	(163)	(600)
	Proceeds from borrowings	594	989
	Debt repayments	(800)	(1)
	Net cash provided by (used in) financing activities	(686)	73
	Net increase in cash and cash equivalents	96	732
Cash and cash equivalents
	At beginning of year	456	839
	At end of period		$	1,571
Supplemental disclosures of cash flow information
	Cash paid during the period for:
	Interest (net of amounts capitalized)		$	114
	Income taxes (net of refunds)	(1)	9

All values are in US Dollars.

See accompanying notes to consolidated financial statements.

Norfolk Southern Corporation and Subsidiaries

Consolidated Statements of Changes in Stockholders’ Equity

(Unaudited)

	Additional<br>Paid-in<br>Capital		Accum. Other<br>Comprehensive<br>Loss		Retained<br>Income		Total

Balance at December 31, 2022	$	2,157	$	(351)	$	10,697	$	12,733
Comprehensive income:
Net income					466		466
Other comprehensive loss			(4)				(4)
Total comprehensive income							462
Dividends on common stock,
1.35 per share					(307)		(307)
Share repurchases	(6)				(156)		(163)
Stock-based compensation	4				(2)		2
Balance at March 31, 2023	$	2,155	$	(355)	$	10,698	$	12,727

All values are in US Dollars.

	Additional<br>Paid-in<br>Capital		Accum. Other<br>Comprehensive<br>Loss		Retained<br>Income		Total

Balance at December 31, 2021	$	2,215	$	(402)	$	11,586	$	13,641
Comprehensive income:
Net income					703		703
Other comprehensive income			8				8
Total comprehensive income							711
Dividends on common stock,
1.24 per share					(297)		(297)
Share repurchases	(19)				(579)		(600)
Stock-based compensation	7				(1)		6
Balance at March 31, 2022	$	2,203	$	(394)	$	11,412	$	13,461

All values are in US Dollars.

See accompanying notes to consolidated financial statements.

Norfolk Southern Corporation and Subsidiaries

Notes to Consolidated Financial Statements

(Unaudited)

In the opinion of management, the accompanying unaudited interim consolidated financial statements contain all adjustments (consisting of normal recurring accruals) necessary to present fairly Norfolk Southern Corporation (Norfolk Southern) and subsidiaries’ (collectively, NS, we, us, and our) financial position at March 31, 2023 and December 31, 2022, our results of operations, comprehensive income and changes in stockholders’ equity for the first quarters of 2023 and 2022, and our cash flows for the first three months of 2023 and 2022 in conformity with U.S. Generally Accepted Accounting Principles (GAAP).

These consolidated financial statements should be read in conjunction with the consolidated financial statements and notes included in our latest Annual Report on Form 10-K.

Railway Operating Revenues

The following table disaggregates our revenues by major commodity group:

	First Quarter
	2023	2022
	( in millions)
Merchandise:
Agriculture, forest and consumer products		$	573
Chemicals	541	498
Metals and construction	400	375
Automotive	284	226
Merchandise	1,878	1,672
Intermodal	814	854
Coal	440	389
Total		$	2,915

All values are in US Dollars.

We recognize the amount of revenues to which we expect to be entitled for the transfer of promised goods or services to customers. A performance obligation is created when a customer under a transportation contract or public tariff submits a bill of lading to us for the transport of goods. These performance obligations are satisfied as the shipments move from origin to destination. As such, transportation revenues are recognized proportionally as a shipment moves, and related expenses are recognized as incurred. These performance obligations are generally short-term in nature with transit days averaging approximately one week or less for each commodity group. The customer has an unconditional obligation to pay for the service once the service has been completed. Estimated revenues associated with in-process shipments at period-end are recorded based on the estimated percentage of service completed. We had no material remaining performance obligations at March 31, 2023 and December 31, 2022.

We may provide customers ancillary services, such as switching, demurrage and other incidental activities, under their transportation contracts. The revenues associated with these distinct performance obligations are recognized when the services are performed or as contractual obligations are met. These revenues are included within each of the commodity groups and represent approximately 6% and 7% of total “Railway operating revenues” on the Consolidated Statements of Income for the first quarters of 2023 and 2022, respectively.

Revenues related to interline transportation services that involve another railroad are reported on a net basis. Therefore, the portion of the amount that relates to another party is not reflected in revenues.

Under the typical terms of our freight contracts, payment for services is due within fifteen days of billing the customer, thus there are no significant financing components. “Accounts receivable – net” on the Consolidated Balance Sheets includes both customer and non-customer receivables as follows:

	March 31,2023	December 31, 2022
	( in millions)
Customer		$	895
Non-customer	251	253
Accounts receivable – net		$	1,148

All values are in US Dollars.

Non-customer receivables include non-revenue-related amounts due from other railroads, governmental entities, and others. We do not have any material contract assets or liabilities at March 31, 2023 and December 31, 2022.

2. Stock-Based Compensation

	First Quarter
	2023	2022
	( in millions)
Stock-based compensation expense		$	23
Total tax benefit	6	13

All values are in US Dollars.

During the first quarter of 2023, we granted stock options, restricted stock units (RSUs) and performance share units (PSUs) pursuant to the Long-Term Incentive Plan (LTIP), as follows:

	First Quarter
	Granted	Weighted-Average Grant-Date Fair Value
Stock options	69,580	$	77.60
RSUs	173,221	237.70
PSUs	58,040	236.68

Stock Options

	First Quarter
	2023	2022
	( in millions)
Options exercised	66,811	119,343
Cash received upon exercise		$	10
Related tax benefits realized	3	5

All values are in US Dollars.

Restricted Stock Units

RSUs granted primarily have a four-year ratable restriction period and will be settled through the issuance of shares of Norfolk Southern common stock (Common Stock). Certain RSU grants include cash dividend equivalent payments during the restriction period in an amount equal to the regular quarterly dividends paid on Common Stock.

	First Quarter
	2023	2022
	( in millions)
RSUs vested	149,122	243,301
Common Stock issued net of tax withholding	104,608	172,364
Related tax benefits realized		$	5

All values are in US Dollars.

Performance Share Units

PSUs provide for awards based on the achievement of certain predetermined corporate performance goals at the end of a three-year cycle and are settled through the issuance of shares of Common Stock. All PSUs will earn out based on the achievement of performance conditions and some will also earn out based on a market condition. The market condition fair value was measured on the date of grant using a Monte Carlo simulation model.

	First Quarter
	2023	2022
	( in millions)
PSUs earned	58,599	86,420
Common Stock issued net of tax withholding	40,255	54,651
Related tax benefits realized		$	1

All values are in US Dollars.

3. Earnings Per Share

The following table sets forth the calculation of basic and diluted earnings per share:

	Basic			Diluted
	First Quarter
	2023	2022		2023		2022
	( in millions, except per share amounts,shares in millions)
Net income		$	703	$	466	$	703
Dividend equivalent payments	(1)	—		—		—
Income available to common stockholders		$	703	$	466	$	703
Weighted-average shares outstanding	227.7	239.3		227.7		239.3
Dilutive effect of outstanding options and share-settled awards				0.6		0.9
Adjusted weighted-average shares outstanding				228.3		240.2
Earnings per share		$	2.94	$	2.04	$	2.93

All values are in US Dollars.

During the first quarters of 2023 and 2022, dividend equivalent payments were made to certain holders of stock options and RSUs. For purposes of computing basic earnings per share, dividend equivalent payments made to holders of stock options and RSUs were deducted from net income to determine income available to common stockholders. For purposes of computing diluted earnings per share, we evaluate on a grant-by-grant basis those stock options and RSUs receiving dividend equivalent payments under the two-class and treasury stock methods to determine which method is more dilutive for each grant. For those grants for which the two-class method was more dilutive, net income was reduced by dividend equivalent payments to determine income available to common stockholders. The dilution calculations exclude options having exercise prices exceeding the average market price of Common Stock as follows: 0.1 million in both the first quarters ended March 31, 2023 and 2022.

Accumulated Other Comprehensive Loss

The changes in the cumulative balances of “Accumulated other comprehensive loss” reported in the Consolidated Balance Sheets consisted of the following:

	Balance at Beginningof Year	Net Income		Reclassification<br>Adjustments		Balance at <br>End of Period
	( in millions)
Three months ended March 31, 2023
Pensions and other postretirement liabilities		$	—	$	(4)	$	(323)
Other comprehensive loss of equity investees	(32)	—		—		(32)
Accumulated other comprehensive loss		$	—	$	(4)	$	(355)
Three months ended March 31, 2022
Pensions and other postretirement liabilities		$	—	$	4	$	(352)
Other comprehensive income (loss) of equity investees	(46)	4		—		(42)
Accumulated other comprehensive loss		$	4	$	4	$	(394)

All values are in US Dollars.

5. Stock Repurchase Program

We repurchased and retired 0.6 million and 2.2 million shares of Common Stock under our stock repurchase programs in the first three months of 2023 and 2022, respectively, at a cost of $163 million and $600 million.

6. Investments

Investment in Conrail

Through a limited liability company, we and CSX Corporation (CSX) jointly own Conrail Inc. (Conrail), whose primary subsidiary is Consolidated Rail Corporation (CRC). We have a 58% economic and 50% voting interest in the jointly-owned entity, and CSX has the remainder of the economic and voting interests. Our investment in Conrail was $1.6 billion at March 31, 2023 and December 31, 2022.

CRC owns and operates certain properties (the Shared Assets Areas) for the joint and exclusive benefit of Norfolk Southern Railway Company (NSR) and CSX Transportation, Inc. (CSXT). The costs of operating the Shared Assets Areas are borne by NSR and CSXT based on usage. In addition, NSR and CSXT pay CRC a fee for access to the Shared Assets Areas. “Purchased services and rents” and “Fuel” include expenses payable to CRC for operation of the Shared Assets Areas totaling $45 million and $38 million for the first quarters of 2023 and 2022, respectively. Our equity in Conrail’s earnings, net of amortization, was $16 million and $14 million for the first quarters of 2023 and 2022, respectively. These amounts partially offset the costs of operating the Shared Assets Areas and are included in “Purchased services and rents.”

“Other liabilities” includes $534 million at both March 31, 2023 and December 31, 2022 for long-term advances from Conrail, maturing in 2050 that bear interest at an average rate of 1.31%.

Investment in TTX

We and seven other North American railroads collectively own TTX Company (TTX), a railcar pooling company that provides its owner-railroads with standardized fleets of intermodal, automotive, and general use railcars at stated rates. We have a 19.78% ownership interest in TTX.

Expenses incurred for use of TTX equipment are included in “Purchased services and rents.” These expenses amounted to $66 million and $64 million for the first quarters of 2023 and 2022, respectively. Our equity in TTX’s earnings partially offsets these costs and totaled $9 million and $10 million for the first quarters of 2023 and 2022, respectively.

7. Debt

In February 2023, we issued $500 million of 4.45% senior notes due 2033.

We have in place an accounts receivable securitization program with a maximum borrowing capacity of $400 million and a term that expires in May 2023. Amounts received under this facility are accounted for as borrowings. We had no amounts outstanding under this program at March 31, 2023 and our available borrowing capacity was $400 million. At December 31, 2022, we had $100 million (at an average variable interest rate of 5.05%) outstanding, which is included within “Short-term debt” and our available borrowing capacity was $300 million. Our accounts receivable securitization program was supported by $916 million and $883 million in receivables at March 31, 2023 and December 31, 2022, respectively, which are included in “Accounts receivable – net”.

8. Pensions and Other Postretirement Benefits

We have both funded and unfunded defined benefit pension plans covering eligible employees. We also provide specified health care benefits to eligible retired employees; these plans can be amended or terminated at our option. Under our self-insured retiree health care plan, for those participants who are not Medicare-eligible, certain health care expenses are covered for retired employees and their dependents, reduced by any deductibles, coinsurance, and, in some cases, coverage provided under other group insurance policies. Eligible retired participants and their spouses who are Medicare-eligible are not covered under the self-insured retiree health care plan, but instead are provided with an employer-funded health reimbursement account which can be used for reimbursement of health insurance premiums or eligible out-of-pocket medical expenses.

Pension and postretirement benefit cost components were as follows:

	Pension Benefits			Other Postretirement Benefits
	First Quarter
	2023	2022		2023		2022
	( in millions)
Service cost		$	10	$	1	$	1
Interest cost	27	17		4		2
Expected return on plan assets	(52)	(53)		(3)		(3)
Amortization of net losses	1	12		—		—
Amortization of prior service benefit	—	—		(6)		(6)
Net benefit		$	(14)	$	(4)	$	(6)

All values are in US Dollars.

The service cost component of defined benefit pension cost and postretirement benefit cost are reported within “Compensation and benefits” and all other components of net benefit cost are presented in “Other income (expense) – net” on the Consolidated Statements of Income.

9. Fair Values of Financial Instruments

The fair values of “Cash and cash equivalents,” “Accounts receivable – net,” “Accounts payable,” and “Short-term debt,” approximate carrying values because of the short maturity of these financial instruments. The carrying value of corporate-owned life insurance is recorded at cash surrender value and, accordingly, approximates fair value. There are no other assets or liabilities measured at fair value on a recurring basis at March 31, 2023 or December 31, 2022. The carrying amounts and estimated fair values, based on Level 1 inputs, of long-term debt consist of the following:

	March 31, 2023			December 31, 2022
	CarryingAmount	Fair<br>Value		Carrying<br>Amount		Fair<br>Value
	( in millions)
Long-term debt, including current maturities		$	(13,889)	$	(15,082)	$	(13,846)

All values are in US Dollars.

10. Commitments and Contingencies

Eastern Ohio Incident

Summary

On February 3, 2023, a train we operated derailed in East Palestine, Ohio. The derailed equipment included 38 railcars, 11 of which were non-Company-owned tank cars containing hazardous materials. Fires associated with the derailment threatened certain of the tank cars. There was concern about the risk that the content of five of the tank cars carrying vinyl chloride might polymerize, which would have posed the risk of a catastrophic explosion. As a consequence, on February 6, 2023, the local incident commander—in consultation with the incident command that included, among others, federal, state and local officials and Norfolk Southern—opted to conduct a controlled vent and burn of five derailed tank cars, all of which contained vinyl chloride. This procedure involved creating holes in the five tank cars to drain the vinyl chloride into adjacent trenches that had been dug into the ground where such vinyl chloride was then burned, with any material remaining after burning of the vinyl chloride being remediated. The February 3rd derailment, the associated fire, and the resulting vent and burn of the tank cars containing vinyl chloride on February 6th is hereinafter referred to as the “Incident.”

In response to the Incident, we have worked to clean the site safely and thoroughly, including those activities described in the Environmental Matters section below with respect to potentially impacted air, soil and water and to monitor for any impact on public health and the environment. We are working with federal, state, and local officials to mitigate impacts from the Incident, including, among other efforts, conducting environmental monitoring and clean-up activities (as more fully described below), and establishing a family assistance center to provide financial support to affected members of the East Palestine and surrounding communities.

Financial Impact

Although we cannot predict the final outcome or estimate the reasonably possible range of loss with certainty, we have recognized $387 million of expense for costs directly attributable to the Incident, which is presented in “Eastern Ohio incident” on the Consolidated Statements of Income. During the first quarter, our cash expenditures attributable to the Incident were $55 million, which are presented in “Net cash provided by operating activities” on the Consolidated Statement of Cash Flows. The remainder, $332 million, is primarily comprised of our estimates of

probable and reasonably estimable liabilities principally associated with environmental matters and legal proceedings, which are discussed in further detail below.

While certain costs recorded in the first quarter may be recoverable under our insurance policies in effect at the date of the Incident, no estimate of potential recoveries has yet been recorded. Any amounts recoverable under our insurance policies will be reflected in future periods in which recovery is considered probable. For additional information about our insurance coverage, see “Insurance” below.

Environmental Matters – In response to the Incident, we have been working with federal, state, and local officials such as the U.S. Environmental Protection Agency (EPA), the Ohio EPA, and the Pennsylvania Department of Environmental Protection, to conduct environmental response and remediation activities, including but not limited to, air monitoring, indoor air quality screenings, municipal water and private water well testing, residential, commercial, and agricultural soil sampling, surface water and groundwater sampling, re-routing a local waterway around the affected site, capturing and shipping stormwater that enters the impacted derailment site to proper disposal facilities, and excavating and disposing of potentially affected soil at hazardous waste landfills or incinerators. The U.S. EPA issued a Unilateral Administrative Order (UAO) on February 21, 2023, containing various requirements, including the submission of numerous work plans to assess and remediate various environmental media and performance of certain removal actions at the affected site. On February 24, 2023, we submitted to the U.S. EPA our Notice of Intent to Comply with the UAO and are currently cooperating with U.S. EPA as well as the Ohio EPA and Pennsylvania Department of Environmental Protection, pursuant to the UAO and the directives issued thereunder.

We are also subject to the following legal proceedings that principally relate to the environmental impact of the Incident:

•The U.S. Department of Justice (DOJ) and the U.S. EPA filed a civil complaint (the DOJ Complaint) in the Northern District of Ohio (Eastern Division) seeking injunctive relief, cost recovery and civil penalties for violations of the Clean Water Act and seeking cost recovery under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA); and

•The Ohio Attorney General filed a CERCLA lawsuit (the Ohio Complaint) in the Northern District of Ohio (Eastern Division) requesting statutory damages for a variety of tort and environmental claims under CERCLA.

In connection with the foregoing items, we recognized $317 million of expense during the first quarter, of which $31 million was paid, related to probable obligations that are reasonably estimable, in accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) 410-30, “Environmental Obligations.” Our current estimate includes ongoing and future environmental cleanup activities and remediation efforts, governmental oversight costs (including those incurred by the U.S. EPA and the Ohio EPA), and other related costs, including those in connection with the DOJ Complaint (including potential civil penalties related to violations of the Clean Water Act). Our current estimates of future environmental cleanup and remediation liabilities related to the Incident may change over time due to various factors, including but not limited to, the success of current cleanup techniques, the nature and extent of required future cleanup activities, and the extent of governmental oversight, amongst other factors. As clean-up efforts progress and more information is available, including any federal and state requirements, we will review these estimates and revise as appropriate.

Legal Proceedings (Non-Environmental) – To date, numerous non-environmental legal actions have been filed with respect to the Incident, including those more specifically set forth below.

•There are currently numerous putative class action and individual lawsuits that have been filed, primarily consolidated in the Northern District of Ohio (Eastern Division). The putative class

action complaints currently allege numerous claims, including negligence, nuisance, trespass, and medical monitoring, and seek as relief, among other things, compensatory and punitive damages. The putative classes are currently defined by reference to class areas ranging from the evacuation zone up to 100 miles away. Additional multi-plaintiff lawsuits are also pending in the same court and others, such as additional lawsuits pending in the Western District of Pennsylvania brought by local school districts including claims such as negligence, nuisance, trespass, and future health monitoring. No responsive pleadings have yet been filed with respect to these matters (collectively referred to herein as the Incident Lawsuits). In accordance with ASC 450, “Contingencies,” we have recognized a $12 million probable loss in the first quarter with respect to the Incident Lawsuits, which is in addition to $16 million in amounts paid during the first quarter with respect to these matters.

•Securities litigation, including a securities class action lawsuit filed in the Southern District of Ohio alleging multiple securities law violations for which no responsive pleading has yet been filed, as well as multiple shareholder demand letters that we have received (collectively, the Shareholder Lawsuits).

If and when we conclude that it is probable that a liability has been incurred and the amount of the liability can be reasonably estimated, it will be accrued through a charge to earnings and, if material, disclosed. Any adjustments to the recorded liability will be reflected in earnings in the periods in which such adjustments become known. Because the final outcome of any of these legal proceedings cannot be predicted with certainty, unfavorable or unexpected developments or outcomes could result in additional accruals that could be significant to results of operations in a particular year or quarter. For legal proceedings where a loss may be reasonably possible, but not probable, or is probable but not reasonably estimable, no accrual is established but the matter, if potentially material, is disclosed.

The reserves established by us during the first quarter do not include any estimate of loss for the following items, for which we believe a loss is either not probable or not reasonably estimable for the reasons noted: (i) the overall cost to us for programs being developed in conjunction with the Ohio Attorney General for affected residents and businesses, which amounts will impact our loss contingency analysis with respect to the Incident Lawsuits described above, namely a healthcare fund, tailored protection for property owners, and programs to protect drinking water over the long term (given the preliminary nature of such discussions), or (ii) any fines or penalties (in excess of the reserves established for Clean Water Act-related civil penalties) that may be imposed as a result of the Incident Inquiries and Investigations, as more specifically set forth and defined below (the outcome of which are uncertain at this time). Additionally, as noted above, amounts recognized during the first quarter do not include potential recoveries from third parties, including the impact of our insurance coverage, which may apply to various Incident-related expenses or liabilities, as more specifically set forth further below (given the preliminary nature of any related discussions with our insurers).

Inquiries and Investigations

As set forth above, we are subject to inquiries and investigations by numerous federal, state, and local government authorities and regulatory agencies regarding the Incident, including but not limited to, the DOJ and the U.S. EPA, the Ohio EPA, the National Transportation Safety Board (NTSB), the Federal Railroad Administration (FRA), the Occupational Safety and Health Administration, the Ohio Attorney General, and the Pennsylvania Attorney General. Further details regarding the NTSB and FRA investigations are set forth below. We are cooperating with all inquiries and investigations, including responding to civil and criminal subpoenas and other requests for information (the aforementioned inquiries and investigations, as well as the civil and criminal subpoenas are collectively referred to herein as the Incident Inquiries and Investigations). The outcome of any current or future Incident Inquiries and Investigations is uncertain at this time, including any related fines, penalties or settlements. Therefore, our first quarter expenses do not include estimates of the total amount that we may incur for any such fines, penalties or settlements.

Subsequent to the Incident, investigators from the NTSB examined railroad equipment and track conditions; reviewed data from the signal system, wayside defect detectors, local surveillance cameras, and the lead locomotive’s event recorder and forward-facing and inward-facing image recorders; and completed certain interviews (the NTSB Investigation). The NTSB issued a preliminary report indicating that one of the cars involved in the derailment appeared to have a wheel bearing in the final stage of overheat failure moments before the derailment. Their preliminary report also indicates that the rail crew was operating the train within our rules; the rail crew operated the train below the track speed limit, the wayside heat detectors were operating as designed; and once the rail crew was alerted by the wayside detector, they immediately began to stop the train. The NTSB’s investigation remains ongoing.

Concurrent with the NTSB Investigation, the FRA is also investigating the Incident. Similar in scope to the NTSB Investigation, the FRA is examining railroad equipment, track conditions, hazardous materials train placement and routing, and emergency response (the FRA Incident Investigation). The FRA Incident Investigation may result in the assessment of civil penalties. In addition to the FRA Incident Investigation, the FRA announced on March 7, 2023 that it would conduct a 60-day supplemental safety assessment (the FRA Safety Assessment). The FRA Safety Assessment will review findings from a previously completed 2022 system audit and assess operational elements including, but not limited to: track, signal, and rolling stock maintenance, inspection and repair practices; protection of employees; communications between transportation departments and mechanical and engineering staff; operation control center procedures and dispatcher training. The overall scope of the FRA Safety Assessment is to examine our safety culture. At the conclusion of the FRA Safety Assessment, the FRA will issue a public report which will include its findings and recommended corrective actions. The FRA Incident Investigation and the FRA Safety Assessment remain ongoing.

Other Commitments and Contingencies

Lawsuits

We and/or certain subsidiaries are defendants in numerous lawsuits and other claims relating principally to railroad operations. When we conclude that it is probable that a liability has been incurred and the amount of the liability can be reasonably estimated, it is accrued through a charge to earnings and, if material, disclosed below. While the ultimate amount of liability incurred in any of these lawsuits and claims is dependent on future developments, in our opinion, the recorded liability is adequate to cover the future payment of such liability and claims. However, the final outcome of any of these lawsuits and claims cannot be predicted with certainty, and unfavorable or unexpected outcomes could result in additional accruals that could be significant to results of operations in a particular year or quarter. Any adjustments to the recorded liability will be reflected in earnings in the periods in which such adjustments become known. For lawsuits and other claims where a loss may be reasonably possible, but not probable, or is probable but not reasonably estimable, no accrual is established but the matter, if potentially material, is disclosed below. We routinely review relevant information with respect to our lawsuits and other claims and update our accruals, disclosures and estimates of reasonably possible loss based on such reviews.

In 2007, various antitrust class actions filed against us and other Class I railroads in various Federal district courts regarding fuel surcharges were consolidated in the District of Columbia by the Judicial Panel on Multidistrict Litigation. In 2012, the court certified the case as a class action. The defendant railroads appealed this certification, and the Court of Appeals for the District of Columbia vacated the District Court’s decision and remanded the case for further consideration. On October 10, 2017, the District Court denied class certification. The decision was upheld by the Court of Appeals on August 16, 2019. Since that decision, various individual cases have been filed in multiple jurisdictions and also consolidated in the District of Columbia. We believe the allegations in the complaints are without merit and intend to vigorously defend the cases. We do not believe the outcome of these proceedings will have a material effect on our financial position, results of operations, or liquidity.

In 2018, a lawsuit was filed against one of our subsidiaries by the minority owner in a jointly-owned terminal railroad company in which our subsidiary has the majority ownership. The lawsuit alleged violations of various

state laws and federal antitrust laws. On January 3, 2023, the court granted summary judgment to us on all of the compensatory claims but denied summary judgment for all equitable relief claims. On January 18, 2023, the court dismissed the federal equitable relief claims, leaving the state equitable relief claims as the sole remaining issue under consideration. On April 19, 2023, the court disposed of all remaining state equitable relief claims. These rulings may be appealed. If appealed, we will continue to vigorously defend the lawsuit and, although it is reasonably possible we could incur a loss in the case, we believe that we will prevail. However, given that litigation is inherently unpredictable and subject to uncertainties, there can be no assurances that the final outcome of the litigation (including any related appeal) will not be material. Until such appeal is final, we cannot reasonably estimate the potential loss or range of loss associated with this matter.

Casualty Claims

Casualty claims include employee personal injury and occupational claims as well as third-party claims, all exclusive of legal costs. To aid in valuing our personal injury liability and determining the amount to accrue with respect to such claims during the year, we utilize studies prepared by an independent consulting actuarial firm. Job-related personal injury and occupational claims are subject to the Federal Employer’s Liability Act (FELA), which is applicable only to railroads. The variability inherent in FELA’s fault-based tort system could result in actual costs being different from the liability recorded. While the ultimate amount of claims incurred is dependent on future developments, in our opinion, the recorded liability is adequate to cover the future payments of claims and is supported by the most recent actuarial study. In all cases, we record a liability when the expected loss for the claim is both probable and reasonably estimable.

Employee personal injury claims – Other than Incident-related matters noted above, the largest component of claims expense is employee personal injury costs. The independent actuarial firm we engage provides quarterly studies to aid in valuing our employee personal injury liability and estimating personal injury expense. The actuarial firm studies our historical patterns of reserving for claims and subsequent settlements, taking into account relevant outside influences. The actuarial firm uses the results of these analyses to estimate the ultimate amount of liability. We adjust the liability quarterly based upon our assessment and the results of the study. The accuracy of our estimate of the liability is subject to inherent limitation given the difficulty of predicting future events such as jury decisions, court interpretations, or legislative changes. As a result, actual claim settlements may vary from the estimated liability recorded.

Occupational claims – Occupational claims include injuries and illnesses alleged to be caused by exposures which occur over time as opposed to injuries or illnesses caused by a specific accident or event. Types of occupational claims commonly seen allege exposure to asbestos and other claimed toxic substances resulting in respiratory diseases or cancer. Many such claims are being asserted by former or retired employees, some of whom have not been employed in the rail industry for decades. The independent actuarial firm provides an estimate of the occupational claims’ liability based upon our history of claim filings, severity, payments, and other pertinent facts. The liability is dependent upon judgments we make as to the specific case reserves as well as judgments of the actuarial firm in the quarterly studies. Our estimate of ultimate loss includes a provision for those claims that have been incurred but not reported. This provision is derived by analyzing industry data and projecting our experience. We adjust the liability quarterly based upon our assessment and the results of the study. However, it is possible that the recorded liability may not be adequate to cover the future payment of claims. Adjustments to the recorded liability are reflected in operating expenses in the periods in which such adjustments become known.

Third-party claims – We record a liability for third-party claims including those for highway crossing accidents, trespasser and other injuries, property damage, and lading damage. The actuarial firm assists us with the calculation of potential liability for third-party claims, except lading damage, based upon our experience including the number and timing of incidents, amount of payments, settlement rates, number of open claims, and legal defenses. We adjust the liability quarterly based upon our assessment and the results of the study. Given the inherent uncertainty in regard to the ultimate outcome of third-party claims, it is possible that the actual loss may differ from the estimated liability recorded.

Environmental Matters

We are subject to various jurisdictions’ environmental laws and regulations. We record a liability where such liability or loss is probable and reasonably estimable. Environmental specialists regularly participate in ongoing evaluations of all known sites and in determining any necessary adjustments to liability estimates.

In addition to environmental claims associated with the Incident, our Consolidated Balance Sheets include liabilities for other environmental exposures of $61 million at March 31, 2023 and $66 million at December 31, 2022, of which $15 million is classified as a current liability at the end of both periods. At March 31, 2023 and December 31, 2022, the liability represents our estimates of the probable cleanup, investigation, and remediation costs based on available information at 85 known locations and projects. At March 31, 2023, twenty sites accounted for $49 million of the liability, and no individual site was considered to be material. We anticipate that most of this liability will be paid out over five years; however, some costs will be paid out over a longer period.

At eight locations, one or more of our subsidiaries in conjunction with a number of other parties have been identified as potentially responsible parties under CERCLA or comparable state statutes that impose joint and several liability for cleanup costs. We calculate our estimated liability for these sites based on facts and legal defenses applicable to each site and not solely on the basis of the potential for joint liability.

As set forth above, with respect to known environmental sites (whether identified by us or by the U.S. EPA or comparable state authorities), estimates of our ultimate potential financial exposure for a given site or in the aggregate for all such sites can change over time because of the widely varying costs of currently available cleanup techniques, unpredictable contaminant recovery and reduction rates associated with available cleanup technologies, the likely development of new cleanup technologies, the difficulty of determining in advance the nature and full extent of contamination and each potential participant’s share of any estimated loss (and that participant’s ability to bear it), and evolving statutory and regulatory standards governing liability.

The risk of incurring environmental liability for acts and omissions, past, present, and future, is inherent in the railroad business. Some of the commodities we transport, particularly those classified as hazardous materials, pose special risks that we work diligently to reduce. In addition, several of our subsidiaries own, or have owned, land used as operating property, or which is leased and operated by others, or held for sale. Because environmental problems that are latent or undisclosed may exist on these properties, there can be no assurance that we will not incur environmental liabilities or costs with respect to one or more of them, the amount and materiality of which cannot be estimated reliably at this time. Moreover, lawsuits and claims involving these and potentially other unidentified environmental sites and matters are likely to arise from time to time. The resulting liabilities could have a significant effect on financial position, results of operations, or liquidity in a particular year or quarter.

Based on our assessment of the facts and circumstances now known, we believe we have recorded the probable and reasonably estimable costs for dealing with those environmental matters of which we are aware. Further, we believe that it is unlikely that any known matters, either individually or in the aggregate, will have a material adverse effect on our financial position, results of operations, or liquidity.

Labor Agreements

Approximately 80% of our railroad employees are covered by collective bargaining agreements with various labor unions. Pursuant to the Railway Labor Act, these agreements remain in effect until new agreements are reached, or until the bargaining procedures mandated by the Railway Labor Act are completed. Moratorium provisions in the labor agreements govern when the railroads and unions may propose changes to the agreements. We largely bargain nationally in concert with other major railroads, represented by the National Carriers’ Conference Committee.

discussions (none of which carry the risk of a work stoppage) with several of our unions to conclude the implementation of these national agreements. With the conclusion of national bargaining, neither party can compel mandatory bargaining around any new proposals until November 1, 2024.

In addition, we understand the imperative to continue improving quality of life for our craft employees and are actively engaged in voluntary local discussions with our unions on this important issue.

Insurance

We purchase insurance covering legal liabilities for bodily injury and property damage to third parties. This insurance provides coverage above $75 million and below $800 million (or up to $1.1 billion for specified types of pollution releases) per occurrence and/or policy year. In addition, we purchase insurance covering damage to property owned by us or in our care, custody, or control. This insurance covers approximately 82% of potential losses above $75 million and below $275 million per occurrence and/or policy year.

Our ability to recoup any of the foregoing amounts under our insurance coverage, including any amounts that may be recoverable with respect to the Incident, is subject to certain conditions, including but not limited to our insurers’ reservation of rights to further investigate and contest coverage, the express restrictions and sub-limits of coverage, and various policy exclusions, including those for some governmental fines or penalties, as well as potential coverage disputes over payments we make as part of our effort to mitigate the impact to the community and affected residents. We are working with our insurers to confirm applicable coverage with respect to the Incident, but no estimate for potential insurance recovery has been accrued at this time.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Norfolk Southern Corporation and Subsidiaries

The following discussion and analysis should be read in conjunction with the Consolidated Financial Statements and Notes.

OVERVIEW

We are one of the nation’s premier transportation companies, moving goods and materials that help drive the U.S. economy. We connect customers to markets and communities to economic opportunity with safe, reliable, and cost-effective shipping solutions. Our Norfolk Southern Railway Company subsidiary operates in 22 states and the District of Columbia. We are a major transporter of industrial products, including agriculture, forest and consumer products, chemicals, and metals and construction materials. In addition, in the East we serve every major container port and operate the most extensive intermodal network. We are also a principal carrier of coal, automobiles, and automotive parts.

Our first quarter results were impacted by a February 2023 derailment in Eastern Ohio. The derailment consisted of 38 railcars and resulted in the release of certain chemicals that were being transported for our customers. Following the Incident (as defined and as further described in Note 10 in the Notes to Consolidated Financial Statements), we have worked to clean the derailment site safely and thoroughly and to monitor for any impact on public health and the environment. Expenses recognized in the first quarter amounted to $387 million and relate to our initial response costs, ongoing cleanup efforts and estimates associated with environmental remediation and legal proceedings. Our current estimates of future environmental cleanup and remediation liabilities related to the Incident may change over time due to various factors, and the final outcome of any legal proceedings cannot be predicted with certainty. Thus, unfavorable or unexpected developments or outcomes could result in additional accruals that could be significant to results of operations in a particular year or quarter. This amount does not include any estimate of loss for specific items for which we believe a loss is either not probable or not reasonably estimable for the reasons noted. In addition, this amount does not include any amounts that may be recoverable from third parties, including expenses or liabilities that may be recovered under our insurance policies and for which such amounts will be reflected in future periods when reimbursement is considered probable. Please see Note 10 in the Notes to Consolidated Financial Statements for a detailed discussion of these estimates and exclusions. We continue to work with federal, state, and local officials to mitigate impacts from the Incident and to provide support to affected members of the community.

Revenue growth over the prior year was driven by higher average revenue per unit, as our volumes for the quarter were flat. In addition to the costs recognized from the Incident, our operating expenses were higher, driven by inflationary pressures and service-related costs. As we continue to make progress in response to the derailment and support the impacted community, we are committed to our strategy — a balanced approach of delivering safe, reliable and resilient service, smart and sustainable growth, and continuous productivity improvement.

SUMMARIZED RESULTS OF OPERATIONS

	First Quarter
	2023	2022		% change
	( in millions, except per share amounts)
Income from railway operations		$	1,085	(34%)
Net income		$	703	(34%)
Diluted earnings per share		$	2.93	(30%)
Railway operating ratio (percent)	77.3	62.8		23%

All values are in US Dollars.

First-quarter 2023 income from railway operations included $387 million of expenses arising from the Incident, which reduced net income by $293 million and diluted earnings per share by $1.28. For more information see Note 10 in the Notes to Consolidated Financial Statements. First quarter income from railway operations, net income, and diluted earnings per share were further impacted by the factors set forth further below.

The following table adjusts our 2023 GAAP financial results to exclude the effects of the Incident. The income tax effect of this non-GAAP adjustment was calculated based on the applicable tax rates to which the non-GAAP adjustment related. We use these non-GAAP financial measures internally and believe this information provides useful supplemental information to investors to facilitate making period-to-period comparisons by excluding the 2023 costs arising from the Incident. While we believe that these non-GAAP financial measures are useful in evaluating our business, this information should be considered as supplemental in nature and is not meant to be considered in isolation, or as a substitute for, the related financial information prepared in accordance with GAAP. In addition, these non-GAAP financial measures may not be the same as similar measures presented by other companies.

	Non-GAAP Reconciliation for First Quarter 2023
	Reported	Eastern Ohio Incident		Adjusted<br>(non-GAAP)
	( in millions, except per share amounts)
Income from railway operations		$	387	$	1,098
Net income		$	293	$	759
Diluted earnings per share		$	1.28	$	3.32
Railway operating ratio (percent)	77.3	(12.4)		64.9

All values are in US Dollars.

In the table below, references to 2023 results and related comparisons use the adjusted, non-GAAP results from the reconciliation in the table above.

	First Quarter
	Adjusted 2023(non-GAAP)	2022		Adjusted 2023 (non-GAAP) <br>vs. 2022
	( in millions, except per share amounts)			% change
Income from railway operations		$	1,085	1%
Net income		$	703	8%
Diluted earnings per share		$	2.93	13%
Railway operating ratio (percent)	64.9	62.8		3%

All values are in US Dollars.

On a non-GAAP basis excluding the impact of the Incident, income from railway operations increased due to higher railway operating revenues. Revenue growth was driven by higher fuel surcharge revenues and pricing gains, as volumes remained flat compared to the same period last year. The rise in revenues was partially offset by increased railway operating expenses, primarily driven by inflationary pressures and service-related costs.

DETAILED RESULTS OF OPERATIONS

Railway Operating Revenues

The following tables present a comparison of revenues ($ in millions), units (in thousands), and average revenue per unit ($ per unit) by commodity group.

	First Quarter
Revenues	2023		2022		% change
Merchandise:
Agriculture, forest and consumer products	$	653	$	573	14%
Chemicals	541		498		9%
Metals and construction	400		375		7%
Automotive	284		226		26%
Merchandise	1,878		1,672		12%
Intermodal	814		854		(5%)
Coal	440		389		13%
Total	$	3,132	$	2,915	7%	Units
---	---	---	---
Merchandise:
Agriculture, forest and consumer products	187.7	177.6	6%
Chemicals	136.1	129.4	5%
Metals and construction	153.4	148.0	4%
Automotive	88.1	81.2	8%
Merchandise	565.3	536.2	5%
Intermodal	916.8	956.5	(4%)
Coal	173.8	165.6	5%
Total	1,655.9	1,658.3	—%		Revenue per Unit
---	---	---	---	---	---
Merchandise:
Agriculture, forest and consumer products	$	3,477	$	3,228	8%
Chemicals	3,979		3,850		3%
Metals and construction	2,607		2,535		3%
Automotive	3,226		2,776		16%
Merchandise	3,323		3,118		7%
Intermodal	887		893		(1%)
Coal	2,533		2,347		8%
Total	1,891		1,758		8%

Railway operating revenues increased $217 million compared with the same period last year. The table below reflects the components of the revenue change by major commodity group ($ in millions).

	First Quarter
	Merchandise		Intermodal		Coal
	Increase (Decrease)
Volume	$	91	$	(35)	$	19
Fuel surcharge revenue	84		29		18
Rate, mix and other	31		(34)		14
Total	$	206	$	(40)	$	51

Approximately 95% of our revenue base is covered by contracts that include negotiated fuel surcharges. Revenues associated with these surcharges totaled $375 million and $244 million in the first quarters of 2023 and 2022, respectively. The increase in fuel surcharge revenues is driven by higher fuel commodity prices.

For the remainder of 2023, we expect that revenue growth will be a challenge, as there is substantial economic uncertainty. We expect revenue headwinds resulting from lower fuel prices, softening coal pricing, and declining storage service charges.

Merchandise

Merchandise revenues increased due to higher average revenue per unit, driven by higher fuel surcharge revenue and increased pricing, as well as higher volumes in all commodity groups.

Agriculture, forest and consumer products volume increased as the shipment demand for corn, soybeans, ethanol, feed, and lumber, more than offset the declines in pulpboard. Volume gains in corn, ethanol, feed and lumber were driven by increased market demand. Higher soybean volume was due to an extended export season. The decline in pulpboard was due to higher inventories slowing down the demand for shipments.

Chemicals volume rose as growth in shipments of sand, petroleum products, and solid waste more than the offset declines in plastics, organic chemicals and natural gas liquids. Volume gains for sand were driven by current market demand, while the volume increases for petroleum and solid waste were both driven by growth with existing customers. Plastics volumes declined due to lower demand as a result of decreased activity in the housing market, while organic chemicals volumes declined as a result of production delays due to weather events. Natural gas liquid volumes were down due to decreased demand.

Metals and construction volume increased, largely driven by higher demand for aggregates and scrap metal.

Automotive volume was higher due to an increase in production of vehicles partially offset by elongated cycle times.

Intermodal

Intermodal revenues decreased, driven by lower volumes, and lower average revenue per unit, a result of decreased storage service charges partially offset by higher fuel surcharge revenue.

Intermodal units (in thousands) by market were as follows:

	First Quarter
	2023	2022	% change
Domestic	587.7	653.4	(10%)
International	329.1	303.1	9%
Total	916.8	956.5	(4%)

Domestic volume declined due to high inventories and increased truck availability resulting in strong over-the-road competition. International volume increased driven by ocean carriers favoring inland point intermodal traffic.

Coal

Coal revenues increased due to higher average revenue per unit, driven by traffic mix and higher fuel surcharge revenue, and increased export coal volumes.

Coal tonnage (in thousands) by market was as follows:

	First Quarter
	2023	2022	% change
Utility	8,210	8,961	(8%)
Export	8,206	6,414	28%
Domestic metallurgical	2,331	2,430	(4%)
Industrial	689	803	(14%)
Total	19,436	18,608	4%

Coal tonnage increased due to increased export volume, partially offset by decreased volumes in all other market groups. Export tonnage was higher due to increased demand, coal supply, and metal production. Utility tonnage decreased as a result of low natural gas prices and mild winter weather. Domestic metallurgical and industrial coal tonnage decreased due to reduced coal shipments related to idled customer facilities.

Railway Operating Expenses

Railway operating expenses summarized by major classifications follow ($ in millions):

	First Quarter
	2023		2022		% change
Compensation and benefits	$	690	$	619	11%
Purchased services and rents	496		437		14%
Fuel	315		301		5%
Depreciation	321		302		6%
Materials and other	212		171		24%
Eastern Ohio incident	387		—
Total	$	2,421	$	1,830	32%

Compensation and benefits expense increased as follows:

•increased pay rates (up $49 million),

•employee activity levels (up $36 million),

•stock-based compensation (down $12 million), and

•other (down $2 million).

Average rail headcount for the quarter was up by over 1,400 compared with the first quarter of 2022 primarily due to the hiring of additional train and engine craft employees.

Purchased services and rents increased as follows ($ in millions):

	First Quarter
	2023		2022		% change
Purchased services	$	399	$	349	14%
Equipment rents	97		88		10%
Total	$	496	$	437	14%

Purchased services primarily increased due to inflationary pressures which resulted in higher intermodal-related expenses, increased operational and transportation expenses, as well as higher technology-related costs. Equipment rents increased as lower network fluidity led to increased intermodal equipment expenses and greater time-and-mileage expenses. We also incurred higher freight car lease costs.

Fuel expense, which includes the cost of locomotive fuel as well as other fuel used in railway operations, increased due to higher locomotive fuel prices (5%). Locomotive fuel consumption was flat compared to the same period last year.

Depreciation expense increased due to our higher asset base and the impact of the results of our periodic roadway study.

Materials and other expenses increased as follows ($ in millions):

	First Quarter
	2023		2022		% change
Materials	$	91	$	62	47%
Claims	54		49		10%
Other	67		60		12%
Total	$	212	$	171	24%

Materials expense increased due to increased locomotive and freight car materials costs. Claims expense increased as a result of higher costs associated with derailments not related to the Incident. Other expense increased due to higher travel-related expenses. Gains from operating property sales, included in Other, totaled $3 million and $6 million in 2023 and 2022, respectively.

Eastern Ohio incident

During the first quarter, we recorded $387 million for costs primarily associated with environmental matters and legal proceedings. The expense recorded in the first quarter does not include any estimates for amounts that may be recovered under our insurance policies. For further details regarding the Incident, see Note 10 in the Notes to Consolidated Financial Statements.

Other income (expense) – net

Other income increased $61 million due to higher returns on corporate-owned life insurance (COLI) and increased interest income.

Income taxes

The first-quarter effective tax rate was 21.3% compared with 22.9% for the same period last year. The effective rate for 2023 includes the recognition of certain business tax credits and tax benefits on stock-based compensation.

FINANCIAL CONDITION AND LIQUIDITY

Cash provided by operating activities, our principal source of liquidity, was $1.2 billion for the first three months of 2023, compared with $1.0 billion for the same period of 2022. The increase reflected changes in working capital, offset in part by lower operating results. We had negative working capital of $702 million and $642 million at March 31, 2023 and December 31, 2022, respectively. Cash and cash equivalents totaled $552 million at March 31, 2023.

Cash used in investing activities was $391 million for the first three months of 2023, compared with $335 million for the same period last year. The increase was primarily driven by higher property additions.

Cash used in financing activities was $686 million for the first three months of 2023, while cash provided by financing activities was $73 million for the same period last year, reflecting higher debt repayments and decreased proceeds from borrowing. Partially offsetting this activity was lower repurchases of Common Stock. We repurchased $163 million of Common Stock in the first three months of 2023 compared to $600 million in the same period last year. The timing and volume of future share repurchases will be guided by our assessment of market conditions and other pertinent factors. Repurchases may be executed in the open market, through derivatives, accelerated repurchase and other negotiated transactions and through plans designed to comply with Rule 10b5-1(c)

and Rule 10b-18 under the Securities and Exchange Act of 1934. Any near-term purchases under the program are expected to be made with internally-generated cash, cash on hand, or proceeds from borrowings.

In February 2023, we issued $500 million of 4.45% senior notes due 2033.

Our debt-to-total capitalization ratio was 54.1% at March 31, 2023 and 54.4% at December 31, 2022. We have in place and available an $800 million credit agreement expiring in March 2025, which provides for borrowings at prevailing rates and includes covenants. We had no amounts outstanding under this facility at March 31, 2023 or December 31, 2022. We also have in place an accounts receivable securitization program with a maximum borrowing capacity of $400 million. The term expires in May 2023. We had no amounts outstanding under this program at March 31, 2023 and $100 million outstanding at December 31, 2022. Our available borrowing capacity was $400 million and $300 million at March 31, 2023 and December 31, 2022, respectively.

In addition, we have investments in general purpose COLI policies and had the ability to borrow against these policies up to $620 million and $610 million at March 31, 2023 and December 31, 2022, respectively.

We expect cash on hand combined with cash provided by operating activities will be sufficient to meet our ongoing obligations. In addition, we believe our currently-available borrowing capacity, access to additional financing, and ability to decrease shareholder distributions, including share repurchases, provide additional flexibility to meet our ongoing obligations. There have been no material changes to the information on future contractual obligations, including those that may have material cash requirements, contained in our Form 10-K for the year ended December 31, 2022, with the exception of additional senior notes (see Note 7).

CRITICAL ACCOUNTING ESTIMATES

The preparation of financial statements in accordance with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. These estimates and assumptions may require judgment about matters that are inherently uncertain, and future events are likely to occur that may require us to make changes to these estimates and assumptions. Accordingly, we regularly review these estimates and assumptions based on historical experience, changes in the business environment, and other factors we believe to be reasonable under the circumstances. In addition to the critical accounting estimates below, the remainder of our critical accounting estimates are contained in our December 31, 2022 Form 10-K.

Contingencies

We are currently involved in certain environmental response and remediation activities and subject to numerous legal proceedings and regulatory inquiries and investigations resulting from the Incident. As required, we have accrued estimates of the probable and reasonably estimable costs for the resolution of these matters. Our environmental estimates are based upon types of remediation efforts currently anticipated, the volume of contaminants in the impacted areas, and governmental oversight and other costs, amongst other factors. Estimates associated with the legal proceedings to which we are subject are based on information that is currently available, including but not limited to an assessment of the proceedings and the potential and likely results of such proceedings.

Our current estimates of future environmental cleanup and remediation liabilities related to the Incident may change over time due to various factors, including but not limited to, the success of current cleanup techniques, the nature and extent of required future cleanup activities, and the extent of governmental oversight, amongst other factors. Additionally, the final outcome of any of the legal proceedings and regulatory inquiries and investigations cannot be predicted with certainty, and unfavorable or unexpected developments or outcomes could result in new or additional accruals that could be material. Furthermore, certain of these costs may be recoverable under our insurance policies in effect at the date of the Incident. Any amounts that are recoverable under our insurance policies will be reflected in periods in which we determine that such amounts are probable of recovery.

See Note 10 in the Notes to Consolidated Financial Statements for more detailed information as it pertains to these contingencies.

OTHER MATTERS

Labor Agreements

The latest round of national bargaining concluded in December 2022, when agreements were either ratified or enacted through legislative action for all twelve of our unions. We are currently participating in additional discussions (none of which carry the risk of a work stoppage) with several of our unions to conclude the implementation of these national agreements. With the conclusion of national bargaining, neither party can compel mandatory bargaining around any new proposals until November 1, 2024.

Inflation

In preparing financial statements, GAAP requires the use of historical cost that disregards the effects of inflation on the replacement cost of property. As a capital-intensive company, we have most of our capital invested in long-lived assets. The replacement cost of these assets, as well as the related depreciation expense, would be substantially greater than the amounts reported on the basis of historical cost.

FORWARD-LOOKING STATEMENTS

Certain statements in Management’s Discussion and Analysis of Financial Condition and Results of Operations are “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, as amended. These statements relate to future events or our future financial performance and involve known and unknown risks, uncertainties, and other factors that may cause our actual results, levels of activity, performance, or our achievements or those of our industry to be materially different from those expressed or implied by any forward-looking statements. In some cases, forward-looking statements can be identified by terminology such as “may,” “will,” “could,” “would,” “should,” “expect,” “plan,” “anticipate,” “intend,” “believe,” “estimate,” “project,” “consider,” “predict,” “potential,” “feel,” or other comparable terminology. We have based these forward-looking statements on our current expectations, assumptions, estimates, beliefs, and projections. While we believe these expectations, assumptions, estimates, beliefs, and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which involve factors or circumstances that are beyond our control. These and other important factors, including those discussed under “Risk Factors” in our latest Form 10-K, as supplemented in Part II, Item 1 A of this Form 10-Q, as well as our subsequent filings with the Securities and Exchange Commission, may cause actual results, performance, or achievements to differ materially from those expressed or implied by these forward-looking statements. The forward-looking statements herein are made only as of the date they were first issued, and unless otherwise required by applicable securities laws, we disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

Additional Information

Investors and others should note that we routinely use the Investor Relations, Performance Metrics, and Sustainability sections of our website (www.norfolksouthern.com/content/nscorp/en/investor-relations.html, http://www.nscorp.com/content/nscorp/en/investor-relations/performance-metrics.html & www.nscorp.com/content/nscorp/en/about-ns/sustainability.html) to post presentations to investors and other important information, including information that may be deemed material to investors. Information about us, including information that may be deemed material, may also be announced by posts on our social media channels, including Twitter (www.twitter.com/nscorp) and LinkedIn (www.linkedin.com/company/norfolk-southern). We may also use our website and social media channels for the purpose of complying with our disclosure obligations under Regulation FD. As a result, we encourage investors, the media, and others interested in Norfolk Southern to review the information posted on our website and social media channels. The information posted on our website and social media channels is not incorporated by reference in this Quarterly Report on Form 10-Q.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

The information required by this item is included in Part I, Item 2, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” under the heading “Financial Condition and Liquidity.”

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

Our Chief Executive Officer and Chief Financial Officer, with the assistance of management, evaluated the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (Exchange Act)) at March 31, 2023. Based on such evaluation, our officers have concluded that, at March 31, 2023, our disclosure controls and procedures were effective in alerting them on a timely basis to material information required to be included in our periodic filings under the Exchange Act.

Changes in Internal Control Over Financial Reporting

During the first quarter of 2023, we have not identified any changes in internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Item 1. Legal Proceedings

For information on our legal proceedings, see Note 10 “Commitments and Contingencies” in the Notes to Consolidated Financial Statements.

Item 1A. Risk Factors

The risks set forth in “Risk Factors” included in our 2022 Form 10-K could have a material adverse effect on our financial position, results of operations, or liquidity in a particular year or quarter, and could cause those results to differ materially from those expressed or implied in our forward-looking statements. Those risks are incorporated herein by reference and are updated to include the following risks.

INCIDENT RISKS

As defined and as further described in Note 10 in the Notes to Consolidated Financial Statements, there was an Incident that occurred in the first quarter that consisted of a February 3, 2023 train derailment in East Palestine, Ohio that included 11 non-Company-owned tank cars containing hazardous materials, fires associated with the derailment that threatened certain of the tank cars, and a controlled vent and burn procedure conducted on February 6, 2023 on five of the derailed tank cars, all of which contained vinyl chloride. As a result of the Incident, we have become subject to numerous legal, regulatory, legislative and other proceedings related thereto, including but not limited to, the NTSB Investigation, the FRA Incident Investigation, the FRA Safety Assessment, the DOJ Complaint, the Ohio Complaint, the Incident Lawsuits, the Shareholder Lawsuits, and the Incident Inquiries and Investigations, in addition to other proceedings, actions, or potential changes in response to the Incident, including but not limited to those related to, among other items, train size, train length, train composition, or crew size (collectively, the “Incident Proceedings”). Set forth below are additional risks pertaining to an investment in the Company that are related to the Incident and the Incident Proceedings.

New or additional governmental regulation and/or operational changes resulting from or related to the Incident or the Incident Proceedings may negatively impact us, our customers, the rail industry, or the markets we serve. The legislative, regulatory, operational or other actions taken, protocols adopted (including by us), or changes resulting from the Incident or any of the Incident Proceedings may, either individually or in the aggregate, negatively impact us, our customers, the rail industry, or the markets we serve. Our inability to comply with the requirements of any new or additional laws, regulations or operating protocols resulting from or related to the Incident or the Incident Proceedings may have a material adverse effect on our financial position, results of operations, liquidity, or operations.

The costs, liabilities, fines, penalties, and/or financial impact resulting from or related to the Incident or the Incident Proceedings may be significant, exceed expected or accrued amounts, or negatively affect our financial results. We have incurred and will continue to remain subject to incurring significant costs, liabilities, fines, and penalties related to the Incident and the Incident Proceedings, including amounts that may have a material adverse effect on our financial position, results of operations, or liquidity.

In addition, while we have provided estimates of probable and reasonably estimable liabilities with respect to the Incident and the Incident Proceedings, we cannot predict the final outcome or estimate the reasonably possible range of loss with certainty and such estimates may change over time due to a variety of factors, including unfavorable or unexpected developments or outcomes which could result in our current estimates being insufficient. These estimated amounts also do not include any estimate of loss for specific items for which we believe a loss is either not probable or not reasonably estimable for the reasons set forth in Note 10 hereto. As a result, our currently accrued amounts of estimated liabilities may be insufficient, and any additional, new or updated accruals may potentially have a material adverse effect on our results of operations or financial condition.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Period	(a) Total Number of Shares (or Units) Purchased (1)	(b) Average Price Paid per Share (or Unit)		(c) Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs (2)	(d) Maximum Number (or Approximate Dollar Value) of Shares (or Units) that may yet be purchased under the Plans or Programs (2)
January 1-31, 2023	491,282	$	252.38	490,984	$	7,365,890,306
February 1-28, 2023	157,502	245.64		157,194	7,327,270,905
March 1-31, 2023	—	—		—	7,327,270,905
Total	648,784			648,178

(1)Of this amount, 606 represent shares were tendered by employees in connection with the exercise of options under the stockholder-approved LTIP.

(2)On March 29, 2022, our Board of Directors authorized a new program for the repurchase of up to $10.0 billion of Common Stock beginning April 1, 2022. As of March 31, 2023, $7.3 billion remains authorized for repurchase.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None.

Item 6. Exhibits

4.1	Tenth Supplemental Indenture, dated as of February 2, 2023, between the Registrant and U.S. Bank Trust Company, National Association (as successor to U.S. Bank National Association), as trustee, is incorporated by reference to Exhibit 4.1 of the Registrant’s Current Report on Form 8-K filed on February 2, 2023.
10.1*	The Norfolk Southern Corporation Executive Life Insurance Plan, as amended and restated effective November 30, 2022 and executed as of February 21, 2023.
10.2*	Third Omnibus Amendment Agreement ,dated January 23, 2023 between NSRC, BA Leasing, BSC, LLC, Bank of America, N.A as Administrative Agent, and each of the Rent Assignees.
31-A*	Rule 13a-14(a)/15d-14(a) CEO Certifications.
31-B*	Rule 13a-14(a)/15d-14(a) CFO Certifications.
32*	Section 1350 Certifications.
101*	The following financial information from Norfolk Southern Corporation’s Quarterly Report on Form 10-Q for the first quarter of 2023, formatted in Inline Extensible Business Reporting Language (iXBRL) includes (i) the Consolidated Statements of Income for the first quarter of 2023 and 2022; (ii) the Consolidated Statements of Comprehensive Income for the first quarter of 2023 and 2022; (iii) the Consolidated Balance Sheets at March 31, 2023 and December 31, 2022; (iv) the Consolidated Statements of Cash Flows for the first three months of 2023 and 2022; (v) the Consolidated Statements of Changes in Stockholders’ Equity for the first quarter of 2023 and 2022; and (vi) the Notes to Consolidated Financial Statements.
104*	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).
* Filed herewith.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		NORFOLK SOUTHERN CORPORATION<br><br>Registrant
Date:	April 26, 2023	/s/ Claiborne L. Moore
		Claiborne L. Moore<br>Vice President and Controller<br>(Principal Accounting Officer) (Signature)
Date:	April 26, 2023	/s/ Denise W. Hutson
		Denise W. Hutson<br>Corporate Secretary (Signature)

Document

Exhibit 10.1

Norfolk Southern Corporation

Executive Life Insurance Plan

As amended and restated effective November 30, 2022

I - Establishment of Plan, Purpose and Effective Date

Establishment of Plan. Norfolk Southern Corporation (“Corporation”) established the Executive Life Insurance Plan (“Plan” or “Program”) effective January 1, 1989, for certain of its nonagreement employees and nonagreement employees of certain of the Corporation’s subsidiary or affiliated companies becoming eligible for benefits under the Plan after January 1, 1989 and before January 1, 2003.

Purpose. The purpose of the Plan is to provide certain key employees of the Employer with contributions made on their behalf into a life insurance product which will be owned by the executives. The executives will apply or have applied for the life insurance, will have full ownership rights to the life insurance contract, and will be able to exercise all ownership rights without involvement by the Employer other than those rights specifically agreed to by the parties as described in this Program. This Plan is intended to provide benefits equal to those provided under the Norfolk Southern Corporation Executive Life Insurance Plan as in effect immediately prior to January 1, 2009.

Type of Plan. This Program is intended to provide a welfare benefit through current compensation. For certain individuals, the Program will provide for compensation to be paid after separation from service. For those individuals, that portion of the program will constitute a plan of deferred compensation, and to the extent applicable, this Program is intended to comply with the requirements of Section 409A of the Internal Revenue Code of 1986, as amended, and all applicable guidance.

Effective Date. The Plan is amended and restated to reflect the termination of the Plan effective November 30, 2022, and the subsequent wind down of the Plan. The Plan was previously amended and restated effective as of December 1, 2018, to clarify the language regarding withholding obligations, and prior to that was last amended and restated effective November 1, 2009.

II - Definitions

For the purposes of this Plan, the following terms will have the meanings indicated unless the context clearly indicates otherwise:

Administrator. "Administrator" means the Vice President – Human Resources of the Corporation.

Adverse Benefit Determination. "Adverse Benefit Determination" means a denial, reduction, or a failure to provide or make payment (in whole or in part) for the benefits provided under the Plan.

Beneficiary(ies). "Beneficiary" or “Beneficiaries” means the person, persons or entity as designated by the Participant, entitled to receive benefits payable from the Insurance Policy upon the Participant's death. If the Participant does not designate a Beneficiary prior to the Participant’s death, then the Beneficiary or Beneficiaries shall be determined according to terms of the Insurance Policy.

Code. "Code" means the Internal Revenue Code of 1986, as may be amended from time to time. Any reference in this Plan to “applicable guidance”, “further guidance” or other similar term shall include any proposed, temporary or final regulations, or any other guidance, promulgated by the U.S. Department of Treasury or the Internal Revenue Service.

Compensation. "Compensation" means the annualized base salary payable by the Employer to the Participant as compensation for services for that calendar year and, for purposes of this Agreement, “Compensation” shall include any amounts deferred by the Participant pursuant to any plan maintained by the Employer pursuant to Sections 401(a) and 401(k) of the Code, or deferred pursuant to any elective non-qualified plan maintained by the Employer.

Disability. "Disability" means a disability that enables a Participant to be eligible for and receive income replacement benefits for a period of not less than three (3) months under the Long Term Disability Plan of Norfolk Southern Corporation and Participating Subsidiary Companies by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months.

Employer. "Employer" means Norfolk Southern Corporation, a Virginia corporation, and its affiliated or subsidiary companies designated by the Administrator, or any successor to the business thereof.

Insurance Carrier. “Insurance Carrier” means one or more life insurance companies chosen by Employer to provide life insurance coverage through specific life insurance policies.

Life Insurance Product. "Life Insurance Product" means the life insurance product issued by an Insurance Carrier on the life of a Participant, to which the Employer will make annual premium payments on behalf of the Participant. The Life Insurance Product will be owned by the Participant and the Employer will have no interest in the Life Insurance Product other than those rights specifically agreed to in the application for such Life Insurance Product.

Participant. "Participant" means any employee who is eligible, under Section III, below, to participate in this Plan, and who elects to participate by completion of the insurance application as well as any Participation Agreement(s) or required forms necessary to issue or, exchange Life Insurance Products as needed from time to time, and whose insurance application has been accepted by the Insurance Carrier with premium rates acceptable to Employer (at the sole discretion of the Administrator) and whose life insurance coverage from this Program is in force. Participant may also be referred to as the “Insured” when the context is appropriate.

Participation Agreement. "Participation Agreement" means the agreement filed by a Participant and approved by the Administrator pursuant to Section III, below.

Retirement. “Retirement“ means the Participant’s Separation from Service following the Participant’s attainment of age 55 with 10 years of service with the Employer;

provided, however, that a Participant who is employed by the Corporation on December 31, 2023 will be treated as having a Retirement on such date.

Separation from Service. “Separation from Service”, or any other similar such phrase means a Participant’s “separation from service” with the Employer, for any reason, within the meaning of Section 409A of the Code, and Treas. Reg. §1.409A-1(h) and other applicable guidance.

Specified Employee. “Specified Employee” means an officer of the Employer with annual compensation greater than $130,000 (indexed), a five percent (5%) owner of the Employer, or a one percent (1%) owner of the Employer with annual compensation greater than $150,000 (not indexed), determined in each case in accordance with Code section 409A. If the Employer has more than 50 officers whose annual compensation exceeds $130,000 (indexed), only the 50 officers with the greatest annual compensation shall be considered "Specified Employees." If an individual meets the definition of "Specified Employee" on December 31, the individual shall be a "Specified Employee" during the 12-month period commencing on the following April 1. For purposes of this definition, annual compensation shall be determined on the basis of Internal Revenue Service Form W-2, Wage and Tax Statement, excluding foreign compensation.

Targeted Death Benefit. “Targeted Death Benefit” is an amount of death benefits to be provided under a Life Insurance Product described in the Participation Agreement, on which Employer Contributions under this Program are to be estimated. The Participation Agreement may provide for different Targeted Death Benefits prior to and after Retirement.

III - Participation

Eligibility. A key employee is eligible to participate in this Plan only if the employee was eligible for benefits under the Plan as in effect prior to January 1, 2009. No employees became eligible to participate in the Plan after December 31, 2002.

Participation. An employee's participation in the Plan will be effective when the Life Insurance Product becomes effective and in force. Subject to the next two paragraphs, participation in the Plan will continue until the earliest of the date that the Participant separates from service with the Employer, until such time as Employer Contributions are no longer provided for by the terms of this Program, or as may otherwise be provided in the Program, including the Participant’s Participation Agreement.

Requirement of Cooperation. As a condition for Participation in this Program, the Participant shall be required to comply with all normal and reasonable requests deemed necessary to apply for and obtain the Life Insurance Product, including but not limited to: providing such information as the Insurance Carrier may require for completion of the insurance application and related forms and documents; taking such physical examinations and supplying medical history as may be requested by the Insurance Carrier; signing the application for the Insurance Policy as the insured; and performing any other act to comply with the underwriting and policy issuance requirements which may reasonably be requested by the Insurance Carrier or the Employer. If, in the sole determination of the Administrator, the Participant has failed to adequately cooperate in the issuance of the Insurance Product, the Employer’s obligations under this Plan shall cease immediately; if the Insurance Carrier is unable to issue a Life Insurance Product in the specified amount at standard rates or at a rate otherwise acceptable to the Employer, the Employer’s obligations under this Plan shall cease immediately.

Change in Employment Status. Unless otherwise determined by the Administrator, in the Administrator’s sole discretion, participation herein and eligibility to receive future contributions under this Plan will cease upon the termination of a Participant’s eligibility to participate in the Corporation’s Management Incentive Plan, the Executive Management Incentive Plan, or any successor plans thereto (other than by reason of death, Disability or Retirement).

IV - Targeted Death Benefit

Basic Formula. The contribution, as set forth in Section V, below, will be based on the Targeted Death Benefit. The Targeted Death Benefit will be as follows:

During Employment Prior to January 1, 2024 – an amount equal to three (3) times Compensation reduced by $50,000 plus the amounts set forth in the Participation Agreement.

After Retirement – the amount set forth in a Participant’s Participation Agreement as the post-retirement benefit amount.

During a period of Disability – an amount equal to three (3) times Compensation reduced by $50,000 plus the amounts set forth in the Participation Agreement, all as determined as of the date of Disability.

Limitations. The Targeted Death Benefit may be limited by factors other than those provided in the formula above and in such events shall be reduced as provided below:

Maximum Face Amount – The Targeted Death Benefit may be limited by the maximum face amount permitted by the Insurance Carrier without underwriting, as may be agreed upon by the Employer and the Insurance Carrier from time to time.

Underwriting Criteria – The Targeted Death Benefit may be reduced by the results of medical or other underwriting imposed by the Insurance Carrier and is limited to the amount of death benefit which can be provided by the Life Insurance Product, assuming preferred or standard rates.

V - Contributions

Employer Contributions. Employer will make contribution(s) to the Life Insurance Product on behalf of the Participant; the amount of such contribution(s) will be as follows:

During Employment and Disability - an amount deemed necessary by the Employer, to provide the Targeted Death Benefit assuming level premium payments are made through age 64 (but no less than 10 years), and based on the reasonable financial assumptions determined as of the time of the Employer Contribution set forth in the attached Exhibit A. To the extent the Targeted Death Benefit is a function of Compensation, the Employer Contribution will be recalculated each year as of December 1, and based on the annualized Compensation as of December 1.

After Retirement – Upon Retirement, the Employer shall continue to make Employer Contributions in an amount deemed necessary by the Employer to provide the Targeted Death Benefit in the minimum number of level annual premiums allowable without causing the Life Insurance Product to violate IRC section 7702, the definition of life insurance, and based on the other reasonable financial assumptions set forth in the attached Exhibit A. Any Employer Contributions to be made after Separation from Service shall be fixed as of the date of separation. To the extent that the amounts so determined would exceed the maximum permissible premium and cause the Policy to violate IRC section 7702, the definition of life insurance, in any subsequent year, such excess amounts will be paid in cash to the Participant at the time of separation.

Additional Employer Contributions. Employer will make an additional annual payment to Participants in an amount equal to the tax due on: (i) the amount of the Employer Contribution provided in the first paragraph of this Article which is in excess of the value of the coverage provided as measured using the Insurance Carrier’s alternative term rates in effect as of January 1, 2009; and (ii) the amount of the Additional Employer Contributions under this paragraph. In calculating the portion of such additional payments each year attributable to the taxes due, it shall be assumed that the Participant is subject to a combined marginal tax rate of 32.2%. Anything to the contrary notwithstanding, a Participant who holds a position at the level of Executive Vice President (or any successor position) or above at the time an Employer Contribution is made shall not be entitled to the Additional Employer Contributions described in this paragraph. The Administrator specifically reserves the right to alter or change the manner in which this additional bonus is to be calculated or paid, including but not limited to altering the applicable tax rate to be assumed under this paragraph.

Cessation of Employer Contributions. Employer Contributions will cease upon the earliest of the following events:

Death

Participant’s separation from service with the Employer prior to Retirement;

Participant partially or completely surrenders, attempts to take a loan from, or withdraws cash value from the Life Insurance Policy, or adjusts the face amount of the Life Insurance Policy other than as provided under the Target Death Benefit prior to Retirement;

Participant makes a contribution to the Life Insurance Product prior to Retirement, except as may be permitted herein; and

Participant has a Change in Employment Status as described above.

Nothing contained herein shall limit the Employer’s ability to terminate Employer Contributions for any Participant prior to Retirement or Disability, or for all Participants upon the termination or amendment of this Plan in the sole discretion of the Employer.

Timing of Employer Contributions. Except as provided in Withholding; Payroll Taxes below, Employer Contributions to the Life Insurance Product will be made on an annual basis on January 15 of each year. A contribution is treated as being made on the date when it is due under the Plan if the payment is made on the due date specified by the Plan, or on a later date that is in the same calendar year. A payment also is treated as being made on the date when it is due under the Plan if the payment is made not more than 30 days before the due date specified by the Plan.

Delay in Payment for Specified Employees. Notwithstanding anything else to the contrary, contributions to be made by the Employer following a Separation from Service (other than by reason of death or Disability) of a Participant who is determined to meet the definition of Specified Employee at the time of Separation from Service shall be payable as otherwise provided, except that the initial payment shall be made no earlier than six (6) months following the date of the Separation from Service.

Participant Contributions. A Participant may not make additional contributions directly into the Life Insurance Product prior to Retirement. Employer will not have the responsibility to monitor or report such contributions.

Withholding; Payroll Taxes. The amount of the Employer Contributions and Additional Employer Contributions, if any, will be treated as current compensation, and as such, Employer shall withhold any taxes required to be withheld with respect to such amounts under local, state or federal law. Such withholding will be made to the greatest extent possible from other Compensation paid to the Participant, and to the extent other Compensation is insufficient to cover the required withholding, the Participant shall reimburse the Employer the amount necessary to meet its withholding obligation. If the Participant does not reimburse the Employer the amount necessary to meet its withholding obligation, then the Employer shall provide the Employer Contribution over the minimum period sufficient to permit the Employer to recover its withholding obligation from other compensation paid to the Participant, but in no event will the Employer Contribution and Additional Employer Contribution be made later than two and one-half months after the close of the calendar year for which the Employer Contribution was otherwise due.

VI - Benefits

Employer Contributions. The sole benefit to be provided by the Employer under this Program is the annual Employer Contributions described in Section V above, as determined by the Administrator based on the Targeted Death Benefit.

Ownership Of Life Insurance Product. Each Participant shall be named as the owner of the Life Insurance Product, and shall have all rights, privileges and duties of an owner as set forth in the Life Insurance Product. Such rights may include, without limitation, the right to name a Beneficiary to receive any death benefits due under the terms of the Life Insurance Policy, the right to request and make withdrawals from the product, including a complete surrender of the Life Insurance Product. All rights as owner of the Life Insurance Product will be exercisable without the consent or involvement of the Employer, except as may be limited in this Plan Document. Notwithstanding the foregoing, the Participant’s exercise of the foregoing rights prior to Retirement may result in a termination of Employer Contributions as specified in Section V, above.

Death Benefits. This Program does not promise any particular level of death benefit, but only an annual contribution, as described herein, which may be based on the costs of providing certain levels of death benefit under a particular Life Insurance Product. The Employer does not guarantee any level of death benefits or that payment will be made by the Insurance Carrier. The Participant’s rights to death benefits, if any, shall solely be as the owner of the Life Insurance Product described herein.

VII - Administration

Administrator; Duties. The primary duty of the Employer with respect to this Plan will be to calculate and make Employer Contributions into the Life Insurance Product on behalf of the Participants. The Administrator will also coordinate with Insurance carrier(s) to effect changes in the death benefit needed to maintain targeted benefit levels subject to the acceptance of the additional risk by the insurance carrier(s). The Administrator will have the authority to make, amend, interpret, and enforce all appropriate rules and regulations for the administration of the Plan and decide or resolve any and all questions, including interpretations of the Plan, as may arise in such administration. The Employer will not have any responsibility regarding the operation of the Life Insurance Product or the exercise of any ownership rights of the Life Insurance Product, which are exercisable solely by the Participant without any involvement from the Employer, except as may be specifically agreed upon.

Binding Effect of Decisions. The decision or action of the Administrator with respect to any question arising out of or in connection with the administration, interpretation and application of the Plan will be final, conclusive and binding upon all persons having any interest in the Plan.

VIII- Termination, Suspension or Amendment

Termination, Suspension or Amendment of Plan. The Corporation expressly reserves the right, in its sole discretion, to cease or suspend Employer Contributions under the Plan at any time, in whole or in part. The Corporation expressly reserves the right, in its sole discretion, to amend or terminate the Plan at any time by an appropriate written instrument executed by its Vice President – Human Resources.

Consistent with such authority, the Corporation terminated the Plan effective November 30, 2022, with all Employer Contributions under the Plan to be completed by November 29, 2024. However, no such termination, suspension or amendment will adversely affect either the amount of Employer Contributions which have been made on behalf of the Participant prior to the date of such amendment or termination of this Plan or Employer Contributions scheduled to be paid on behalf of any Participant whose Retirement or Disability occurred before the date of such amendment or termination of this Plan.

IX - Claims Procedure

Claim. Any person or entity claiming the benefit of annual Employer Contributions described in Section V above, requesting an interpretation or ruling under the Plan, or requesting information under the Plan (hereinafter referred to as "Claimant") shall present the request in writing to the Administrator. Benefit claim determinations will be made in accordance with the terms of the Plan and will be applied consistently with respect to similarly situated claimants.

Denial of Claim. The Administrator shall provide a written explanation of any Adverse Benefit Determination within 90 days, unless special circumstances require an extension of time for processing the claim, in which case the Administrator will provide the Participant recipient with written notice of the extension before expiration of the 90-day period. The notice of the extension will indicate the special circumstances requiring an extension of time and the date by which the Administrator expects to render a decision. The extension will not exceed 90 days from the end of the initial period.

If the Administrator issues an Adverse Benefit Determination, claim or request is denied, the written notice shall state:

a)The reason for the Adverse Benefit Determination, with specific reference to the Plan provisions on which the determination is based;

b)A description of any additional material or information required and an explanation of why it is necessary; and

An explanation of the Plan's claims review procedure and the applicable time limits, including a statement of the right to bring a civil action following an Adverse Benefit Determination on review.

Review of Claim. Any Claimant who receives an Adverse Benefit Determination or who has not received a response within sixty (60) days may request a review by notice given in writing to the Administrator. Such request must be made within sixty (60) days after receipt by the Claimant of the written notice of Adverse Benefit Determination, or in the event Claimant has not received a response sixty (60) days after receipt by the Administrator of Claimant's claim or request. The claim or request shall be reviewed by the Administrator which may, but shall not be required to, grant the Claimant a hearing. On review, the Claimant may have representation, examine pertinent documents, and submit issues and comments in writing relating to the claim for benefits.

Final Decision. The Administrator’s review will take into account all comments, documents, records, and other information submitted, without regard to whether such information was submitted or considered in the initial benefit determination. The Administrator will render a decision within 60 days after receipt of written request for review, unless the Administrator determines that special circumstances require an extension of time for processing the claim, in which case the Administrator will provide the Participant with written notice of the extension before the expiration of the initial 60-day period. The notice will indicate the special circumstances requiring an extension of time and the date by which the Administrator expects to render a decision. The extension will not exceed 120 days from receipt of a request for review by the Administrator.

The Administrator will notify the Participant of its benefit determination on review. In the case of an Adverse Benefit Determination, the notice will include the specific reason or reasons for the Adverse Benefit Determination, reference to the specific Plan provisions on which the determination is based, and a statement that the Participant or alternate recipient is entitled to receive, upon request and free of charge, reasonable access to and copies of all documents, records and other information relevant to the claim. The notice will also include a statement that the Plan does not have any additional mandatory appeal procedures and that the Participant has the right to bring a civil action under Section 502(a) of the Employee Retirement Income Security Act (ERISA). All decisions on review shall be final and bind all parties concerned.

X - Miscellaneous

Code Section 409A. To the extent applicable, the Plan is intended, and shall be construed, to comply with the requirements of Section 409A of the Code. The Corporation does not warrant that the Plan will comply with Section 409A of the Code with respect to any Participant or with respect to any payment, however. In no event shall the Corporation, its officers, directors, employees, parents, subsidiaries (including any Employer), or affiliates be liable for any additional tax, interest, or penalty incurred by a Participant or Beneficiary as a result of the Plan’s failure to satisfy the requirements of Section 409A of the Code, or as a result of the Plan’s failure to satisfy any other applicable requirements for the deferral of tax.

Not a Contract of Employment. This Plan will not constitute a contract of employment between Employer and the Participant. Nothing in this Plan will give a Participant the right to be retained in the service of Employer or to interfere with the right of Employer to discipline or discharge a Participant at any time.

Protective Provisions. A Participant will cooperate with Employer by furnishing any and all information requested by Employer in order to facilitate the Employer Contributions as provided for in this Plan, and by taking such physical examinations as Employer may deem necessary and by taking such other action as may be requested by Employer.

Governing Law. The provisions of this Plan shall be construed and interpreted according to federal law and, to the extent not preempted by federal law, according to the laws of the Commonwealth of Virginia.

Validity. If any provision of this Plan will be held illegal or invalid for any reason, said illegality or invalidity shall not affect the remaining parts hereof, but this Plan shall be construed and enforced as if such illegal and invalid provision had never been inserted herein.

Notice. Any notice or filing required or permitted under the Plan will be sufficient if in writing and hand delivered or sent by registered or certified mail. Such notice will be deemed given as of the date of delivery or, if delivery is made by mail, as of the date shown on the postmark on the receipt for registration or certification. Mailed notice to the Administrator will be directed to the Employer's address. Mailed notice to a Participant will be directed to the individual's last known address in Employer's records.

Successors. The provisions of this Plan shall bind and inure to the benefit of Employer and its successors and assigns. The term successors as used herein includes any corporate or other business entity which shall, whether by merger, consolidation, purchase or otherwise acquire all or substantially all of the business and assets of Employer, and successors of any such corporation or other business entity.

Dated: February 21, 2023 /s/ Barbara Paul

Barbara N. Paul

Vice President, Human Resources

Norfolk Southern Corporation

Exhibit A

Norfolk Southern Corporation

Cash Value Target	Level Premiums solved to provide enough cash value immediately after assumed termination of employment at age 65 to continue the Targeted Death Benefit and endow at age 95. If employment extends past age 65, termination is assumed to occur the following year.
Death Benefit:	Targeted Death Benefit as provided by the Program.
Salary Scale	5% during employment to age 65
Premiums	During employment, payable annually through age 64 but no less than 10 years of premium payments; upon Retirement, payable for the minimum number of years permitted without violation of §7702 of the Code.
Cost of Insurance Charges	Actual COI charges up to date of resolve; thereafter, insurance carrier’s current COI rates for the product as of the date of resolve.
Interest Crediting Rate:	Actual policy crediting rates up to date of resolve; thereafter, insurance carrier’s current general account crediting rate for the product as of the date of resolve.
Premium Duration:	As provided by the Program

Document

Exhibit 10.2

Third Omnibus Amendment Agreement

This Third Omnibus Amendment Agreement, dated as of January 23, 2023 (this “Amendment”), is by and among Norfolk Southern Railway Company, a Virginia corporation, as Lessee (together with its permitted successors and assigns, in its capacity as Lessee, “Lessee”); Norfolk Southern Corporation, a Virginia corporation, as Guarantor (“Guarantor”); BA Leasing BSC, LLC, a Delaware limited liability company, as Lessor (“Lessor”); Bank of America, N.A., not in its individual capacity, except as expressly stated herein, but solely as Administrative Agent (“Administrative Agent”) and the persons listed on the signature pages hereto as Rent Assignees (each, a “Rent Assignee”, and collectively, the “Rent Assignees”).

Whereas, Lessee, Lessor, Administrative Agent and Rent Assignees are parties to that certain Participation Agreement, dated as of March 1, 2019 (as amended, modified and/or otherwise supplemented from time to time, the “Participation Agreement”);

Whereas, Lessor, the Administrative Agent and the Rent Assignees are party to that certain Rent Assignment Agreement, dated as of March 1, 2019 (as amended, modified and/or otherwise supplemented from time to time, the “Rent Assignment Agreement”);

Whereas, Guarantor is party to that certain Guaranty, dated as of March 1, 2019 (as amended, modified and/or otherwise supplemented from time to time, the “Guaranty”), in favor of the Beneficiaries (as defined therein);

Whereas, Lessee has requested that Lessor, the Rent Assignees and the Administrative Agent amend certain terms set forth in the Participation Agreement and the Rent Assignment Agreement, and Lessor, the Rent Assignees and the Administrative Agent are willing to amend such terms, on the terms and conditions set forth in this Amendment.

Now, Therefore, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, it is hereby agreed by and among the parties hereto as follows:

Section 1. Definitions; Incorporation of Recitals. Each capitalized term used but not otherwise defined herein has the meaning assigned to it in Appendix 1 to the Participation Agreement, as amended hereby. Any reference herein to any Operative Document or to any other defined term shall mean and be a reference to such Operative Document or defined term as set forth in the Participation Agreement and such Operative Document. Each reference in this Amendment to the Operative Documents, or to any individual Operative Document, shall mean the Operative Documents or such individual Operative Document as amended or otherwise modified by this Amendment. All of the Recitals to this Amendment, including the terms defined therein, are hereby made a part of the agreements contained herein as if fully set forth herein. This Amendment shall be an Operative Document.

Section 2. Amendments to the Operative Documents. From and after the date of this Amendment, but subject to the satisfaction of the conditions set forth in Section 4, each of Lessee, Guarantor, Lessor, the Rent Assignees and the Administrative Agent hereby agree that the Participation Agreement and the Rent Assignment Agreement shall be amended as follows:

(a)Section 14.1 of the Participation Agreement is hereby deleted in its entirety and the following is substituted therefor:

Third Omnibus Amendment (Norfolk Southern) 4882-3336-7610 v8.doc

4283388

Section 14.1. Term SOFR Rate Lending Unlawful. If any Participant shall reasonably determine (which determination shall, upon notice thereof to the Lessee and the Participants, be conclusive and binding on the Lessee and which notice shall be withdrawn whenever the applicable circumstances no longer exist) that the introduction of or any change in or in the interpretation of any applicable law makes it unlawful, or any central bank or other Governmental Authority asserts that it is unlawful, for such Participant to make available, continue or maintain any Rent Assignment Contribution or Lessor Amount that bears Yield based upon the Term SOFR Rate, as the case may be, the obligation of such Participant to make available, continue or maintain any such Rent Assignment Contribution or Lessor Amount, as the case may be, on a Term SOFR Rate basis shall, upon such determination, forthwith be suspended (unless such Participant determines in its sole discretion that it can continue to make any Rent Assignment Contribution or Lessor Amount based upon the Term SOFR Rate at one of its lending offices where such action would not be deemed unlawful) until such Participant shall notify the Lessee and Lessor that the circumstances causing such suspension no longer exist and, to the extent required by any such introduction of or change in or in the interpretation of any law, all Rent Assignment Contributions and Lessor Amount, as the case may be, of such Participant shall automatically accrue Yield at the Alternate Base Rate (unless and until a Successor Rate has been determined in accordance with Section 14.10(b)) either (a) on the last day of the then current Interest Period applicable to such Rent Assignment Contribution or Lessor Amount, as the case may be, if such Participant may lawfully continue to maintain and fund such Rent Assignment Contribution or Lessor Amount, or (b) immediately if such Participant shall determine that it may not lawfully continue to maintain and fund such Rent Assignment Contribution or Lessor Amount, as the case may be, to such day or sooner, if required by such law or assertion.

(b)Section 14.2 of the Participation Agreement is hereby deleted in its entirety and substituted with “[Intentionally omitted.]”.

(c)The reference to “LIBO Rate” in Section 14.7 of the Participation Agreement is hereby deleted and substituted with “Term SOFR Rate”.

(d)The reference to “LIBO Rate” in Section 14.9 of the Participation Agreement is hereby deleted and substituted with “Term SOFR Rate”.

(e)Section 14.10 of the Participation Agreement is hereby deleted in its entirety and the following is substituted therefor:

Section 14.10. Inability to Determine Rates.

(a) If (i) the Administrative Agent determines (which determination shall be conclusive absent manifest error) that (x) no Successor Rate has been determined in accordance with Section 14.10(b), and the circumstances under clause (i) of Section 14.10(b) or the Scheduled Unavailability Date has occurred, or (y) adequate and reasonable means do not otherwise exist for determining Term SOFR for any Interest Period, or (ii) the Administrative Agent or the Required Participants determine that

for any reason that Term SOFR for any Interest Period does not adequately and fairly reflect the cost to such Participants of their Funding, then the Administrative Agent will promptly so notify the Lessee and each Participant.

Thereafter, the obligation of the Participants to maintain the Fundings at the Term SOFR Rate shall be suspended (to the extent of the affected Fundings or Interest Periods) until the Administrative Agent (or, in the case of a determination by the Required Participants described in clause (ii) of this Section 14.10(a), until the Administrative Agent upon the instruction of the Required Participants) revokes such notice, and any such Funding (to the extent of the affected Fundings or Interest Periods) shall bear Yield on an Alternate Base Rate basis (unless and until a Successor Rate has been determined in accordance with Section 14.10(b)).

(b) Replacement of Term SOFR or Successor Rate. Notwithstanding anything to the contrary in this Participation Agreement or any other Operative Documents, if the Administrative Agent determines (which determination shall be conclusive absent manifest error), or the Lessee or Required Participants notify the Administrative Agent (with, in the case of the Required Participants, a copy to the Lessee) that the Lessee or Required Participants (as applicable) have determined, that:

(i) adequate and reasonable means do not exist for ascertaining Term SOFR, including, without limitation, because the Term SOFR Screen Rate is not available or published on a current basis and such circumstances are unlikely to be temporary; or

(ii) CME or any successor administrator of the Term SOFR Screen Rate or a Governmental Authority having jurisdiction over the Administrative Agent or such administrator with respect to its publication of Term SOFR, in each case acting in such capacity, has made a public statement identifying a specific date after Term SOFR or the Term SOFR Screen Rate shall or will no longer be made available, or permitted to be used for determining the interest rate of U.S. dollar denominated syndicated loans, or shall or will otherwise cease, provided that, at the time of such statement, there is no successor administrator that is satisfactory to the Administrative Agent, that will continue to provide Term SOFR after such specific date (the latest date on which Term SOFR or the Term SOFR Screen Rate are no longer available permanently or indefinitely, the “Scheduled Unavailability Date”);

then, on a date and time determined by the Administrative Agent (any such date, the “Term SOFR Replacement Date”), which date shall be at the end of an Interest Period for Yield calculated and, solely with respect to clause (ii) above, no later than the Scheduled Unavailability Date, Term SOFR will be replaced hereunder and under any Operative Document with Daily Simple SOFR plus the SOFR Adjustment for any payment period for Yield calculated that can be determined by the Administrative Agent, in each case, without any amendment to, or further action or consent of any other party to, this Participation Agreement or any other Operative Document (the “Successor Rate”).

If the Successor Rate is Daily Simple SOFR plus the SOFR Adjustment, all Yield payments will be payable on a monthly basis on the applicable Payment Date.

Notwithstanding anything to the contrary herein or in any other Operative Document, (x) if the Administrative Agent determines that Daily Simple SOFR is not available on or prior to the Term SOFR Replacement Date, or (y) if the events or circumstances of the type described in Section 14.10(b)(i) or (ii) have occurred with respect to the Successor Rate then in effect, then in each case, the Administrative Agent and the Lessee may amend this Participation Agreement solely for the purpose of replacing Term SOFR or any then current Successor Rate in accordance with this Section 14.10 at the end of any Interest Period with an alternative benchmark rate giving due consideration to any evolving or then existing convention for similar U.S. dollar denominated credit facilities syndicated and agented in the United States for such alternative benchmark and, in each case, including any mathematical or other adjustments to such benchmark giving due consideration to any evolving or then existing convention for similar U.S. dollar denominated credit facilities syndicated and agented in the United States for such benchmark, which adjustment or method for calculating such adjustment shall be published on an information service as selected by the Administrative Agent from time to time in its reasonable discretion and may be periodically updated. For the avoidance of doubt, any such proposed rate and adjustments, shall constitute a “Successor Rate”. Any such amendment shall become effective at 5:00 p.m. (New York City time) on the fifth Business Day after the Administrative Agent shall have posted such proposed amendment to all Participants and the Lessee unless, prior to such time, Participants comprising the Required Participants have delivered to the Administrative Agent written notice that such Required Participants object to such amendment. If no Successor Rate is agreed to by Administrative Agent and Lessee, the Rent Assignment Contribution Amount and the Lessor Amount will be deemed to bear Yield on an Alternate Base Rate basis until a Successor Rate is so agreed to by Administrative Agent and Lessee. The Administrative Agent will promptly (in one or more notices) notify the Lessee and each Participant of the implementation of any Successor Rate.

Any Successor Rate shall be applied in a manner consistent with market practice; provided that to the extent such market practice is not administratively feasible for the Administrative Agent, such Successor Rate shall be applied in a manner as otherwise reasonably determined by the Administrative Agent.

Notwithstanding anything else herein, if at any time any Successor Rate as so determined would otherwise be less than 0%, the Successor Rate will be deemed to be 0% for the purposes of this Participation Agreement and the other Operative Documents.

In connection with the implementation of a Successor Rate, the Administrative Agent will have the right to make Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other Operative Document, any amendments implementing such

Conforming Changes will become effective without any further action or consent of any other party to this Participation Agreement; provided that, with respect to any such amendment effected, the Administrative Agent shall post each such amendment implementing such Conforming Changes to the Lessee and the Participants reasonably promptly after such amendment becomes effective.

(f)Section 16.10 of the Participation Agreement is hereby deleted in its entirety and the following is substituted therefor:

Section 16.10. Yield Rates. The Administrative Agent does not warrant, or accept responsibility for, nor shall the Administrative Agent have any liability with respect to, the administration or submission of or any other matter related to the rates in the definition of “Term SOFR Rate” or with respect to any rate that is an alternative or replacement for or successor to any of such rate (including, without limitation, any Successor Rate) or the effect of any of the foregoing, or of any Conforming Changes.

(g)The definitions of “Applicable Funding Office”, “Break Costs”, “Business Day”, “Series A Yield Rate”, “Series B Yield Rate”, “SOFR” and “Term SOFR” are each hereby deleted from Appendix 1 to the Participation Agreement and the following are substituted, as applicable, therefor:

“Applicable Funding Office” means, for each Participant, the office of such Participant set forth as the Applicable Funding Office for such Participant on Schedule III to the Participation Agreement, as applicable, or such other office of such Participant (or of an Affiliate of such Participant) as such Participant may from time to time specify to the Administrative Agent and Lessee by written notice as the office from which its Rent Assignment Contributions or Lessor Amount, as applicable, accruing Yield at the Term SOFR Rate are made available and maintained.

“Break Costs” means an amount equal to the amount, if any, required to compensate Lessor or any Rent Assignee for any additional losses (including, without limitation, any loss, cost or expense incurred by reason of the liquidation or reemployment of deposits or funds acquired by Lessor or any Rent Assignee to fund its obligations under the Operative Documents) it may reasonably incur as a result of (w) the exercise by Lessor of the purchase option set forth in Section 2.9 of the Rent Assignment Agreement, (x) Lessee’s payment of Basic Rent or the Lease Balance other than on a Payment Date, (y) [omitted] or (z) as a result of any conversion of the Term SOFR Rate during an Interest Period pursuant to and in accordance with the Operative Documents. A statement as to the amount of such loss, cost or expense, prepared in good faith and in reasonable detail and submitted by Lessor or any Rent Assignee, as the case may be, to Lessee, shall be presumed correct absent demonstrable error.

“Business Day” means (a) each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which banks in any of Atlanta, Georgia and New York, New York are generally authorized or obligated, by law or executive order, to close and (b) relative

to any determination of the Term SOFR Rate, any day which is a U.S. Government Securities Business Day.

“Series A Yield Rate” means, with respect to any Interest Period (A) the sum of the Term SOFR Rate for such Interest Period, plus the Applicable Margin for the Rent Assignment Contribution Commitment, and (B) if the provisions of Section 14.1 or Section 14.10 of the Participation Agreement for such Interest Period shall apply, the Alternate Base Rate or the Successor Rate, as applicable, plus, in the case of the Successor Rate, the Applicable Margin for the Rent Assignment Contribution Commitment.

“Series B Yield Rate” means, with respect to any Interest Period (A) the sum of the Term SOFR Rate for such Interest Period, plus the Applicable Margin for the Lessor Commitment, and (B) if the provisions of Section 14.1 or Section 14.10 of the Participation Agreement for such Interest Period shall apply, the Alternate Base Rate or the Successor Rate, as applicable, plus in the case of the Successor Rate, the Applicable Margin for the Lessor Commitment.

“SOFR” means the Secured Overnight Financing Rate as administered by the Federal Reserve Bank of New York (or a successor administrator).

“Term SOFR” means for any Interest Period with respect to any Fundings bearing Yield by reference to the Term SOFR Rate, the rate per annum equal to the Term SOFR Screen Rate two U.S. Government Securities Business Days prior to the commencement of such Interest Period with a term equivalent to such Interest Period; provided that if the rate is not published prior to 11:00 a.m. (New York City time) on such determination date then Term SOFR means the Term SOFR Screen Rate on the first U.S. Government Securities Business Day immediately prior thereto.

(h)The following definitions are hereby inserted into Appendix 1 to the Participation Agreement in appropriate alphabetical order:

“CME” means CME Group Benchmark Administration Limited.

“Conforming Changes” means, with respect to the use, administration of or any conventions associated with SOFR or any proposed Successor Rate or Term SOFR, as applicable, any conforming changes to the definitions of “SOFR”, “Term SOFR” and “Interest Period”, timing and frequency of determining rates and making payments of interest and other technical, administrative or operational matters (including, for the avoidance of doubt, the definitions of “Business Day” and “U.S. Government Securities Business Day”, timing of borrowing requests or prepayment, conversion or continuation notices and length of lookback periods) as may be appropriate, in the discretion of the Administrative Agent, to reflect the adoption and implementation of such applicable rate(s) and to permit the administration thereof by the Administrative Agent in a manner substantially consistent with market practice (or, if the Administrative Agent determines that adoption of any portion of such market practice is not administratively feasible or that no market practice for the administration of such rate exists, in such other manner of administration

as the Administrative Agent determines is reasonably necessary in connection with the administration of the Participation Agreement and any other Operative Document).

“Daily Simple SOFR” with respect to any applicable determination date means the SOFR published on such date on the Federal Reserve Bank of New York’s website (or any successor source selected by the Administrative Agent in its reasonable discretion).

“SOFR Adjustment” with respect to Daily Simple SOFR means 0.10% (10 basis points); and with respect to Term SOFR means 0.10% (10 basis points).

“Successor Rate” is defined in Section 14.10 of the Participation Agreement.

“Term SOFR Rate” means the sum of (a) Term SOFR plus (b) the SOFR Adjustment; provided that if Term SOFR determined in accordance with the foregoing would otherwise be less than zero, the Term SOFR shall be deemed zero for purposes of the Participation Agreement.

“Term SOFR Screen Rate” means the forward-looking SOFR term rate administered by CME (or any successor administrator satisfactory to the Administrative Agent) and published on the applicable Reuters screen page (or such other commercially available source providing such quotations as may be designated by the Administrative Agent from time to time in its reasonable discretion).

“U.S. Government Securities Business Day” means any Business Day, except any Business Day on which any of the Securities Industry and Financial Markets Association, the New York Stock Exchange or the Federal Reserve Bank of New York is not open for business because such day is a legal holiday under the federal laws of the United States or the laws of the State of New York, as applicable.

(i)The definitions of “Adjustment”, “LIBO Rate”, “LIBOR Screen Rate” “LIBOR Successor Rate”, “LIBOR Successor Rate Conforming Changes”, “Relevant Governmental Body” and “SOFR-Based Rate” are deleted from Appendix 1 to the Participation Agreement.

(j)The reference to “LIBO Rate” set forth in Section 2.1 of the Rent Assignment Agreement is hereby deleted and “Term SOFR Rate” is substituted therefor.

(k)The reference to “LIBO Rate” set forth in Section 2.6 of the Rent Assignment Agreement is hereby deleted and “Term SOFR Rate” is substituted therefor.

Section 3. Representations.

(a) Lessee by its execution of this Amendment hereby represents and warrants that, as of the date hereof and as of the effectiveness of this Amendment:

(i) each of the representations and warranties of Lessee in Section 8.2 of the Participation Agreement (other than Section 8.2(d)) and in each of the other Operative

Documents are true and correct in all material respects, except to the extent such representations or warranties relate solely to an earlier date, in which case such representations and warranties are true and correct in all material respects on and as of such earlier date; and

(ii) there has been no Default, Event of Default, Force Majeure Event, Event of Loss or Material Environmental Violation.

(b) Guarantor by its execution of this Amendment hereby represents and warrants that, as of the date hereof and as of the effectiveness of this Amendment, each of the representations and warranties set forth in Section 7 of the Guaranty (other than Section 7(d)(ii) and Section 7(e)) are true and correct in all material respects as of the date hereof, except to the extent such representations and warranties relate solely to an earlier date, in which case such representations and warranties are true and correct in all material respects as of such earlier date.

Section 4. Closing Conditions. The effectiveness of this Amendment is conditioned upon the satisfaction or waiver of all of the conditions precedent set forth in this Section 4:

(a) Administrative Agent shall have received executed counterparts of this Amendment from Lessee, Guarantor, Lessor and each Rent Assignee;

(b) No event shall exist that constitutes a Default, an Event of Default, Force Majeure Event, an Event of Loss or Material Environmental Violation;

(d) Guarantor’s representations set forth in Section 3(b) shall be true and correct on and as of the date hereof; and

(e) All proceedings taken in connection with the transactions contemplated by this Amendment and all documents necessary to the consummation thereof or which are addressed to the Lessor shall be in form and substance reasonably satisfactory to the Lessor and its counsel, and all legal matters in connection with the transaction contemplated hereby shall be reasonably satisfactory to counsel for the Lessor.

Section 5. Guarantor Reaffirmation. Guarantor, by its execution of this Amendment, hereby reaffirms its obligations under the Guaranty and waives any defense which might arise due to the execution and delivery of this Amendment and the performance of the terms hereof.

Section 6. Further Assurances. Each of the parties hereto hereby agrees to execute any and all further documents, agreements and instruments and take all further action that may be reasonably requested or be required by law or otherwise, necessary to give effect to this Amendment.

Section 7. Miscellaneous.

(a) Lessee hereby agrees to pay all reasonable costs and expenses, including reasonable and documented attorneys’ fees, incurred by Lessor in connection with the negotiation, preparation, execution and delivery of this Amendment and any other documents, instruments and agreements in connection therewith.

(b) This Amendment shall be governed by, and construed in accordance with, the laws of the State of New York including Section 5-1401 of the New York General Obligations Law and all matters of construction, validity and performance without regard, however to other principles of conflicts law.

(c) Sections 15.12 (Submission to Jurisdiction) and 15.13 (Waiver of Jury Trial) of the Participation Agreement are hereby incorporated herein as if set forth herein.

(d) This Amendment shall be binding upon and inure to the benefit of the parties hereto, and their respective successors and assigns.

(e) Section headings in this Amendment are included for convenience of reference only and are not part of this agreement for any other purpose.

(f) Each Participant, by its execution of this Amendment, hereby consents and agrees to the matters set forth herein, requests and directs Administrative Agent to execute, deliver and perform this Amendment and any other documents, agreements and instruments and take all further action that may be reasonably requested or be required by law or otherwise, necessary to give effect to this Amendment and to take any and all actions as may be necessary or convenient to effect the transactions contemplated hereby and/or thereby.

(g) From and after the date of this Amendment, but subject to the satisfaction of the conditions set forth in Section 4, (i) each reference to the Participation Agreement or the Rent Assignment Agreement in any Operative Document (including in any Exhibit or Schedule attached thereto) shall be deemed to be a reference to the Participation Agreement or the Rent Assignment Agreement as amended by this Amendment, and (ii) each reference in the Participation Agreement or the Rent Assignment Agreement to “this Agreement,” “hereunder,” “hereof,” “herein,” or words of like import, and each reference in the other Operative Documents to the Participation Agreement or the Rent Assignment Agreement (including, without limitation, by means of words like “thereunder,” “thereof” and words of like import), shall mean and be a reference to the Participation Agreement or the Rent Assignment Agreement, as amended by this Amendment. Except as expressly amended hereby or specifically consented to above, all of the terms and provisions of the Operative Documents are and shall remain in full force and effect and are hereby ratified and confirmed.

Section 8. Electronic Signatures.

(a) This Amendment, any Operative Document and any document, amendment, approval, consent, information, notice, certificate, request, statement, disclosure or authorization related to this Amendment or any Operative Document (each a “Communication”), including Communications required to be in writing, may, if agreed by the Lessor and Administrative

Agent, be in the form of an Electronic Record and may be executed using Electronic Signatures, including, without limitation, facsimile and/or .pdf. Each of the parties hereto agrees that any Electronic Signature on or associated with any Communication shall be valid and binding on such Person to the same extent as a manual, original signature, and that any Communication entered into by Electronic Signature will constitute the legal, valid and binding obligation of such Person enforceable against such Person in accordance with the terms thereof to the same extent as if a manually executed original signature was delivered. Any Communication may be executed in as many counterparts as necessary or convenient, including both paper and electronic counterparts, but all such counterparts are one and the same Communication. For the avoidance of doubt, the authorization under this paragraph may include, without limitation, use or acceptance by the Administrative Agent, Lessor and each of the Rent Assignees of a manually signed paper Communication which has been converted into electronic form (such as scanned into PDF format), or an electronically signed Communication converted into another format for transmission, delivery and/or retention. The Administrative Agent, Lessor and each of the Rent Assignees may, at its option, create one or more copies of any Communication in the form of an imaged Electronic Record (“Electronic Copy”), which shall be deemed created in the ordinary course of such Person’s business, and destroy the original paper document. All Communications in the form of an Electronic Record, including an Electronic Copy, shall be considered an original for all purposes, and shall have the same legal effect, validity and enforceability as a paper record. Notwithstanding anything contained herein to the contrary, the Administrative Agent is under no obligation to accept an Electronic Signature in any form or in any format unless expressly agreed to by the Administrative Agent pursuant to procedures approved by it; provided, without limiting the foregoing, (a) to the extent the Administrative Agent has agreed to accept such Electronic Signature, the Administrative Agent, Lessor and each of the Rent Assignees shall be entitled to rely on any such Electronic Signature purportedly given by or on behalf of Lessee or Guarantor without further verification and regardless of the appearance or form of such Electronic Signature and (b) upon the request of the Administrative Agent, Lessor or any Rent Assignee, any Communication executed using any Electronic Signature shall be promptly followed by a manually executed, original counterpart. For purposes hereof, “Electronic Record” and “Electronic Signature” shall have the meanings assigned to them, respectively, by 15 USC §7006, as it may be amended from time to time.

(b) Neither the Administrative Agent nor Lessor shall be responsible for or have any duty to ascertain or inquire into the sufficiency, validity, enforceability, effectiveness or genuineness of any Operative Document or any other agreement, instrument or document (including, for the avoidance of doubt, in connection with the Administrative Agent’s or Lessor’s reliance on any Electronic Signature transmitted by telecopy, emailed .pdf or any other electronic means). The Administrative Agent and Lessor shall be entitled to rely on, and shall incur no liability under or in respect of this Amendment or any other Operative Document by acting upon, any Communication or any statement made to it orally or by telephone and believed by it to be genuine and signed or sent or otherwise authenticated (whether or not such Person in fact meets the requirements set forth in the Operative Documents for being the maker thereof).

(c) Each of the parties hereto hereby waives (i) any argument, defense or right to contest the legal effect, validity or enforceability of this Amendment and/or any other Operative Document based solely on the lack of paper original copies of this Amendment and/or such other

Operative Document, and (ii) any claim against the Administrative Agent, Lessor or and each Rent Assignee for any liabilities arising solely from the Administrative Agent’s, Lessor’s and/or any Rent Assignee’s reliance on or use of Electronic Signatures, including any liabilities arising as a result of the failure of the Lessee or Guarantor to use any available security measures in connection with the execution, delivery or transmission of any Electronic Signature.

(d) Each of the parties hereto represents and warrants to the other parties that it has the corporate capacity and authority to execute this Amendment and any other Communication through electronic means and there are no restrictions on doing so in that party’s constitutive documents.

(e) Notwithstanding anything to the contrary in any Operative Document, for any Payment Date occurring on or prior to January 23, 2023, Yield shall be calculated and paid in accordance with applicable provisions of the Operative Documents, as in effect prior to the date of this Amendment.

[signature pages follow]

In Witness Whereof, the parties hereto have executed and delivered this Amendment as of the date first written above.

Norfolk Southern Railway Company, as Lessee

By: /s/ Christopher R.Neikirk

Name: Christopher R.Neikirk

Title: Vice President &Treasurer

[Signature Page to Third Omnibus Amendment Agreement (Norfolk Southern)]

Norfolk Southern Corporation, as Guarantor

By: /s/ Christopher R.Neikirk

Name: Christopher R.Neikirk

Title: Vice President &Treasurer

[Signature Page to Third Omnibus Amendment Agreement (Norfolk Southern)]

Bank of America, N.A., not in its individual capacity, but solely as Administrative Agent

By: /s/ Teresa Weirath

Name: Teresa Weirath

Title: Vice President

[Signature Page to Third Omnibus Amendment Agreement (Norfolk Southern)]

BA Leasing BSC, LLC, as Lessor and as Rent Assignee

By: /s/ Denise C. Simpson

Name: Denise C. Simpson

Title:Vice President

[Signature Page to Third Omnibus Amendment Agreement (Norfolk Southern)]

Capital One, National Association, as Rent Assignee

By: /s/ William Panagis

Name: William Panagis

Title: Duly Authorized Signatory

[Signature Page to Third Omnibus Amendment Agreement (Norfolk Southern)]

PNC Equipment Finance, LLC, as Rent Assignee

By: /s/ Samuel E. Hacie II

Name: Samuel E. Hacie II

Title: Senior Vice President

[Signature Page to Third Omnibus Amendment Agreement (Norfolk Southern)]

SMBC Leasing and Finance, Inc., as Rent Assignee

By: /s/ Stephen R. Decly

Name:Stephen R. Decly

Title: President

[Signature Page to Third Omnibus Amendment Agreement (Norfolk Southern)]

U.S. Bank National Association, as Rent Assignee

By:/s/ Eric M. Herm

Name:Eric M. Herm

Title: Assistant Vice President

[Signature Page to Third Omnibus Amendment Agreement (Norfolk Southern)]

Wells Fargo Bank, N.A., as Rent Assignee

By: /s/ Mylissa Merten

Name: Mylissa Merten

Title: Vice President

[Signature Page Third Omnibus Amendment Agreement (Norfolk Southern)]

Document

Exhibit 31-A

CERTIFICATIONS

I, Alan H. Shaw, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Norfolk Southern Corporation;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated: April 26, 2023

/s/ Alan H. Shaw
Alan H. Shaw
President and Chief Executive Officer

Document

Exhibit 31-B

CERTIFICATIONS

I, Mark R. George, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Norfolk Southern Corporation;

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated: April 26, 2023

/s/ Mark R. George
Mark R. George
Executive Vice President Finance and Chief Financial Officer

Document

Exhibit 32

CERTIFICATIONS OF CEO AND CFO REQUIRED BY RULE 13a-14(b) OR RULE

15d-14(b) AND SECTION 1350 OF CHAPTER 63 OF TITLE 18 OF THE U.S. CODE

I certify, to the best of my knowledge, that the Quarterly Report on Form 10-Q for the period ended March 31, 2023, of Norfolk Southern Corporation fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that the information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of Norfolk Southern Corporation.

Signed:	/s/ Alan H. Shaw
	Alan H. Shaw
	President and Chief Executive Officer
	Norfolk Southern Corporation

Dated: April 26, 2023

Signed:	/s/ Mark R. George
	Mark R. George
	Executive Vice President Finance and Chief Financial Officer
	Norfolk Southern Corporation

Dated: April 26, 2023

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

Commission File Number: 1-8339

NORFOLK SOUTHERN CORPORATION

TABLE OF CONTENTS

NORFOLK SOUTHERN CORPORATION AND SUBSIDIARIES

Item 1. Financial Statements

Norfolk Southern Corporation and Subsidiaries

Consolidated Statements of Income

See accompanying notes to consolidated financial statements.

Norfolk Southern Corporation and Subsidiaries

Consolidated Statements of Comprehensive Income

See accompanying notes to consolidated financial statements.

Norfolk Southern Corporation and Subsidiaries

Consolidated Balance Sheets

See accompanying notes to consolidated financial statements.

Norfolk Southern Corporation and Subsidiaries

Consolidated Statements of Cash Flows

See accompanying notes to consolidated financial statements.

Norfolk Southern Corporation and Subsidiaries

Consolidated Statements of Changes in Stockholders’ Equity

See accompanying notes to consolidated financial statements.

Norfolk Southern Corporation and Subsidiaries

Notes to Consolidated Financial Statements

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Norfolk Southern Corporation and Subsidiaries

OVERVIEW

SUMMARIZED RESULTS OF OPERATIONS

DETAILED RESULTS OF OPERATIONS

FINANCIAL CONDITION AND LIQUIDITY

CRITICAL ACCOUNTING ESTIMATES

OTHER MATTERS

FORWARD-LOOKING STATEMENTS

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Item 4. Controls and Procedures

Item 1. Legal Proceedings

Item 1A. Risk Factors

INCIDENT RISKS

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Item 3. Defaults Upon Senior Securities

Item 4. Mine Safety Disclosures

Item 5. Other Information

Item 6. Exhibits

SIGNATURES