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Table of Contents
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 September 30, 2020
OR
()    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 1-8022
csx-20200930_g1.jpg
CSX CORPORATION
(Exact name of registrant as specified in its charter)
Virginia62-1051971
(I.R.S. Employer Identification No.)
500 Water Street15th FloorJacksonvilleFL32202904359-3200
(Address of principal executive offices)(Zip Code)(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 classTrading Symbol(s)Name of exchange on which registered
Common Stock, $1 Par ValueCSXNasdaq Global Select Market
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 (X) No ( )
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted 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 (X) 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 (as defined in Exchange Act Rule 12b-2).
Large Accelerated Filer (X)     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 a check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes () No (X)
There were 764,774,958 shares of common stock outstanding on September 30, 2020 (the latest practicable date that is closest to the filing date).
CSX Q3 2020 Form 10-Q p.1

Table of Contents

CSX CORPORATION
FORM 10-Q
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2020
INDEX
Page
PART I.FINANCIAL INFORMATION
Item 1.
Quarters and Nine Months Ended September 30, 2020 and September 30, 2019
Quarters and Nine Months Ended September 30, 2020 and September 30, 2019
At September 30, 2020 (Unaudited) and December 31, 2019
Nine Months Ended September 30, 2020 and September 30, 2019
Quarters and Nine Months Ended September 30, 2020 and September 30, 2019
Item 2.
Item 3.
Item 4.
PART II.OTHER INFORMATION
Item 1.
Item 1A.
Item 2.
Item 3.
Defaults upon Senior Securities
Item 4.
Mine Safety Disclosures
Item 5.
Other Information
Item 6.
Exhibits
CSX Q3 2020 Form 10-Q p.2

Table of Contents
CSX CORPORATION
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CONSOLIDATED INCOME STATEMENTS (Unaudited)
(Dollars in millions, except per share amounts)
Third QuartersNine Months
2020201920202019
Revenue$2,648 $2,978 $7,758 $9,052 
Expense
Labor and Fringe574 638 1,687 1,958 
Materials, Supplies and Other378 407 1,239 1,323 
Depreciation348 338 1,036 1,005 
Fuel119 223 402 690 
Equipment and Other Rents88 85 247 265 
Total Expense1,507 1,691 4,611 5,241 
Operating Income1,141 1,287 3,147 3,811 
Interest Expense(187)(186)(565)(548)
Other Income - Net14 24 51 72 
Earnings Before Income Taxes968 1,125 2,633 3,335 
Income Tax Expense(232)(269)(628)(775)
Net Earnings$736 $856 $2,005 $2,560 
Per Common Share (Note 2)
Net Earnings Per Share, Basic$0.96 $1.08 $2.61 $3.19 
Net Earnings Per Share, Assuming Dilution$0.96 $1.08 $2.61 $3.18 
Average Shares Outstanding (In millions)
765 790 767 803 
Average Shares Outstanding, Assuming Dilution (In millions)
767 792 769 805 
CONDENSED CONSOLIDATED COMPREHENSIVE INCOME STATEMENTS (Unaudited)
(Dollars in millions)
Third QuartersNine Months
2020201920202019
Total Comprehensive Earnings (Note 11)$770 $863 $2,062 $2,573 

Certain prior year data has been reclassified to conform to the current presentation.

See accompanying notes to consolidated financial statements.

CSX Q3 2020 Form 10-Q p.3

Table of Contents
CSX CORPORATION
ITEM 1. FINANCIAL STATEMENTS
CONSOLIDATED BALANCE SHEETS
(Dollars in millions)
(Unaudited)
September 30,
2020
December 31,
2019
ASSETS
Current Assets:
Cash and Cash Equivalents$2,898 $958 
Short-term Investments1 996 
Accounts Receivable - Net (Note 8)980 986 
Materials and Supplies253 261 
Other Current Assets96 77 
  Total Current Assets4,228 3,278 
Properties45,409 45,100 
Accumulated Depreciation(13,028)(12,932)
  Properties - Net32,381 32,168 
Investment in Conrail1,012 982 
Affiliates and Other Companies937 897 
Right-of-Use Lease Asset 500 532 
Other Long-term Assets385 400 
  Total Assets$39,443 $38,257 
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts Payable$1,042 $1,043 
Labor and Fringe Benefits Payable436 489 
Casualty, Environmental and Other Reserves (Note 4)104 100 
Current Maturities of Long-term Debt (Note 7)371 245 
Income and Other Taxes Payable140 69 
Other Current Liabilities201 205 
  Total Current Liabilities2,294 2,151 
Casualty, Environmental and Other Reserves (Note 4)205 205 
Long-term Debt (Note 7)16,121 15,993 
Deferred Income Taxes - Net7,087 6,961 
Long-term Lease Liability 475 493 
Other Long-term Liabilities 534 591 
  Total Liabilities26,716 26,394 
Shareholders' Equity:
Common Stock, $1 Par Value
765 773 
Other Capital400 346 
Retained Earnings12,166 11,404 
Accumulated Other Comprehensive Loss (Note 11)(618)(675)
Non-controlling Interest14 15 
Total Shareholders' Equity12,727 11,863 
Total Liabilities and Shareholders' Equity$39,443 $38,257 

See accompanying notes to consolidated financial statements.
CSX Q3 2020 Form 10-Q p.4

Table of Contents
CSX CORPORATION
ITEM 1. FINANCIAL STATEMENTS
CONSOLIDATED CASH FLOW STATEMENTS (Unaudited)
(Dollars in millions)
Nine Months
20202019
OPERATING ACTIVITIES
Net Earnings$2,005 $2,560 
Adjustments to Reconcile Net Earnings to Net Cash Provided by Operating Activities:
Depreciation1,036 1,005 
Deferred Income Taxes117 186 
Gains on Property Dispositions(33)(129)
Other Operating Activities(30)(81)
Changes in Operating Assets and Liabilities:
Accounts Receivable12 (39)
Other Current Assets(37)84 
Accounts Payable(6)152 
Income and Other Taxes Payable98 114 
Other Current Liabilities(34)(115)
Net Cash Provided by Operating Activities3,128 3,737 
INVESTING ACTIVITIES
Property Additions(1,209)(1,191)
Proceeds from Property Dispositions51 218 
Purchases of Short-term Investments(426)(2,255)
Proceeds from Sales of Short-term Investments1,423 1,480 
Other Investing Activities(32)19 
Net Cash Used In Investing Activities(193)(1,729)
FINANCING ACTIVITIES
Long-term Debt Issued (Note 7)500 2,000 
Long-term Debt Repaid (Note 7)(245)(18)
Dividends Paid(599)(577)
Shares Repurchased(664)(2,767)
Other Financing Activities13 17 
Net Cash Used in Financing Activities(995)(1,345)
Net Increase in Cash and Cash Equivalents1,940 663 
CASH AND CASH EQUIVALENTS
Cash and Cash Equivalents at Beginning of Period958 858 
Cash and Cash Equivalents at End of Period$2,898 $1,521 
Certain prior year data has been reclassified to conform to the current presentation.

See accompanying notes to consolidated financial statements.
CSX Q3 2020 Form 10-Q p.5

Table of Contents
CSX CORPORATION
ITEM 1. FINANCIAL STATEMENTS
CONSOLIDATED STATEMENTS OF CHANGES
IN SHAREHOLDERS' EQUITY
(Dollars in millions)
Nine Months 2020
Common Shares Outstanding
(Thousands)
Common Stock and Other CapitalRetained Earnings
Accumulated
Other
Comprehensive Income (Loss)(a)
Non-controlling InterestTotal Shareholders' Equity
Balance December 31, 2019773,471 $1,119 $11,404 $(675)$15 $11,863 
Comprehensive Earnings:
Net Earnings— — 770 — — 770 
Other Comprehensive Income (Note 11)— — — 3 — 3 
Total Comprehensive Earnings773 
Common stock dividends, $0.26 per share
— — (201)— — (201)
Share Repurchases(8,906)(9)(568)— — (577)
Stock Option Exercises and Other894 21 7 — 2 30 
Balance March 31, 2020765,459 $1,131 $11,412 $(672)$17 $11,888 
Comprehensive Earnings:
Net Earnings— — 499 — — 499 
Other Comprehensive Income (Note 11)— — — 20 — 20 
Total Comprehensive Earnings519 
Common stock dividends, $0.26 per share
— — (199)— — (199)
Share Repurchases(580)(1)(38)— — (39)
Stock Option Exercises and Other174 (4)2 — (4)(6)
Balance June 30, 2020765,053 $1,126 $11,676 $(652)$13 $12,163 
Comprehensive Earnings:
Net Earnings— — 736 — — 736 
Other Comprehensive Income (Note 11)— — — 34 — 34 
Total Comprehensive Earnings770 
Common stock dividends, $0.26 per share
— — (199)— — (199)
Share Repurchases(705)(1)(47)— — (48)
Stock Option Exercises and Other427 40  — 1 41 
Balance September 30, 2020764,775 $1,165 $12,166 $(618)$14 $12,727 
a) Accumulated Other Comprehensive Loss balances shown above are net of tax. The associated taxes were $183 million, $178 million and $165 million as of first, second and third quarters 2020, respectively. For additional information, see Note 11, Other Comprehensive Income.
See accompanying notes to consolidated financial statements.
CSX Q3 2020 Form 10-Q p.6

Table of Contents
CSX CORPORATION
ITEM 1. FINANCIAL STATEMENTS
CONSOLIDATED STATEMENTS OF CHANGES
IN SHAREHOLDERS' EQUITY
(Dollars in Millions)

Nine Months 2019
Common Shares Outstanding (Thousands)
Common Stock and Other CapitalRetained Earnings
Accumulated Other Comprehensive Income (Loss)(a)
Non-controlling InterestTotal Shareholders' Equity
Balance December 31, 2018818,180 $1,067 $12,157 $(661)$17 12,580 
Comprehensive Earnings:
Net Earnings— — 834 — — 834 
Other Comprehensive Income (Note 11)— — — 2 — 2 
Total Comprehensive Earnings836 
Common stock dividends, $0.24 per share
— — (195)— — (195)
Share Repurchases(11,540)(12)(784)— — (796)
Stock Option Exercises and Other2,524 21 (1)— — 20 
Balance March 31, 2019809,164 1,076 12,011 (659)17 12,445 
Comprehensive Earnings:
Net Earnings— — 870 — — 870 
Other Comprehensive Income (Note 11)— — — 4 — 4 
Total Comprehensive Earnings874 
Common stock dividends, $0.24 per share
— — (193)— — (193)
Share Repurchases(11,266)(11)(849)— — (860)
Stock Option Exercises and Other278 23 4 — (3)24 
Balance June 30, 2019798,176 1,088 11,843 (655)14 12,290 
Comprehensive Earnings:
Net Earnings— — 856 — — 856 
Other Comprehensive Income (Note 11)— — — 7 — 7 
Total Comprehensive Earnings863 
Common stock dividends, $0.24 per share
— — (189)— — (189)
Share Repurchases(16,098)(16)(1,095)— — (1,111)
Stock Option Exercises and Other264 24 1 — 1 26 
Balance September 30, 2019782,342 $1,096 $11,416 $(648)$15 $11,879 

a) Accumulated Other Comprehensive Loss balances shown above are net of tax. The associated taxes were $179 million, $177 million and $175 million
as of first, second and third quarters 2019, respectively. For additional information, see Note 11, Other Comprehensive Income.
See accompanying notes to consolidated financial statements.
CSX Q3 2020 Form 10-Q p.7

Table of Contents
CSX CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

NOTE 1.    Nature of Operations and Significant Accounting Policies
Background
CSX Corporation together with its subsidiaries ("CSX" or the “Company”), based in Jacksonville, Florida, is one of the nation's leading transportation companies. The Company provides rail-based transportation services including traditional rail service, the transport of intermodal containers and trailers, as well as other transportation services such as rail-to-truck transfers and bulk commodity operations.

    CSX's principal operating subsidiary, CSX Transportation, Inc. (“CSXT”), provides an important link to the transportation supply chain through its approximately 20,000 route mile rail network, which serves major population centers in 23 states east of the Mississippi River, the District of Columbia and the Canadian provinces of Ontario and Quebec. The Company's intermodal business links customers to railroads via trucks and terminals.

CSXT is also responsible for the Company's real estate sales, leasing, acquisition and management and development activities. Substantially all of these activities are focused on supporting railroad operations.

Other entities
    In addition to CSXT, the Company’s subsidiaries include CSX Intermodal Terminals, Inc. (“CSX Intermodal Terminals”), Total Distribution Services, Inc. (“TDSI”), Transflo Terminal Services, Inc. (“Transflo”), CSX Technology, Inc. (“CSX Technology”) and other subsidiaries. CSX Intermodal Terminals owns and operates a system of intermodal terminals, predominantly in the eastern United States and also performs drayage services (the pickup and delivery of intermodal shipments) for certain customers and trucking dispatch operations. TDSI serves the automotive industry with distribution centers and storage locations. Transflo connects non-rail served customers to the many benefits of rail by transferring products from rail to trucks. The biggest Transflo markets are chemicals and agriculture, which includes shipments of plastics and ethanol. CSX Technology and other subsidiaries provide support services for the Company.
    
Basis of Presentation
In the opinion of management, the accompanying consolidated financial statements contain all normal, recurring adjustments necessary to fairly present the consolidated financial statements and accompanying notes. Where applicable, prior year information has been reclassified to conform to the current presentation. Pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”), certain information and disclosures normally included in the notes to the annual financial statements prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) have been omitted from these interim financial statements. CSX suggests that these financial statements be read in conjunction with the audited financial statements and the notes included in CSX's most recent annual report on Form 10-K and any subsequently filed current reports on Form 8-K.

Fiscal Year
The Company's fiscal periods are based upon the calendar year. Except as otherwise specified, references to “third quarter(s)” or “nine months” indicate CSX's fiscal periods ending September 30, 2020 and September 30, 2019, and references to "year-end" indicate the fiscal year ended December 31, 2019.

CSX Q3 2020 Form 10-Q p.8

Table of Contents
CSX CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE 1.Nature of Operations and Significant Accounting Policies, continued

New Accounting Pronouncements
In June 2016, the FASB issued ASU Measurement of Credit Losses on Financial Instruments, which replaces current methods for evaluating impairment of financial instruments not measured at fair value, including trade accounts receivable and certain debt securities, with a current expected credit loss model. CSX adopted this new standard update effective January 1, 2020, and it did not have a material effect on the Company's results of operations.

In August 2018, the FASB issued ASU Changes to the Disclosure Requirements for Defined Benefit Plans as part of its disclosure effectiveness initiative, which modifies the disclosure requirements for employer-sponsored defined benefit pension and other postretirement plans. This update is effective for the Company beginning January 1, 2021 and adoption of the standard is not expected to significantly impact the Company's disclosures.

NOTE 2.    Earnings Per Share

    The following table sets forth the computation of basic earnings per share and earnings per share, assuming dilution:
Third QuartersNine Months
2020201920202019
Numerator (Dollars in millions):
Net Earnings
$736 $856 $2,005 $2,560 
Denominator (Units in millions):
Average Common Shares Outstanding765 790 767 803 
Other Potentially Dilutive Common Shares2 2 2 2 
Average Common Shares Outstanding, Assuming Dilution
767 792 769 805 
Net Earnings Per Share, Basic
$0.96 $1.08 $2.61 $3.19 
Net Earnings Per Share, Assuming Dilution
$0.96 $1.08 $2.61 $3.18 
    
Basic earnings per share is based on the weighted-average number of shares of common stock outstanding. Earnings per share, assuming dilution, is based on the weighted-average number of shares of common stock outstanding and common stock equivalents adjusted for the effects of common stock that may be issued as a result of potentially dilutive instruments. CSX's potentially dilutive instruments are made up of equity awards including performance units and employee stock options.

CSX Q3 2020 Form 10-Q p.9

Table of Contents
CSX CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE 2.    Earnings Per Share, continued

    When calculating diluted earnings per share, the potential shares that would be outstanding if all outstanding stock options were exercised are included. This number is different from outstanding stock options because it is offset by shares CSX could repurchase using the proceeds from these hypothetical exercises to obtain the common stock equivalent. The total average outstanding stock options that were excluded from the diluted earnings per share calculation because their effect was antidilutive is in the table below.
Third QuartersNine Months
2020201920202019
Antidilutive stock options excluded from Diluted EPS (Millions)
2121

Share Repurchases    
    In January 2019, the Company announced a $5 billion share repurchase program. At September 30, 2020, approximately $1.1 billion of authority remained under this program. On October 21, 2020, the Company announced a new, incremental $5 billion share repurchase program, bringing the remaining repurchase authority as of the announcement date to $6.1 billion. During the third quarter and nine months ended 2020 and 2019, the Company engaged in the following repurchase activities:

Third QuartersNine Months
2020201920202019
Shares Repurchased (Millions)
1 16 10 39 
Cost of Shares (Dollars in millions)
$48 $1,111 $664 $2,767 

    Share repurchases may be made through a variety of methods including, but not limited to, open market purchases, purchases pursuant to Rule 10b5-1 plans, accelerated share repurchases and negotiated block purchases. The timing of share repurchases depends upon management's assessment of marketplace conditions and other factors, and the program remains subject to the discretion of the Board of Directors. Future share repurchases are expected to be funded by cash on hand, cash generated from operations and debt issuances. Shares are retired immediately upon repurchase. In accordance with the Equity Topic in the Accounting Standards Codification ("ASC"), the excess of repurchase price over par value is recorded in retained earnings.

Dividend Increase
In February 2020, the Company's Board of Directors authorized an 8% increase in the quarterly cash dividend to $0.26 per common share.


CSX Q3 2020 Form 10-Q p.10

Table of Contents
CSX CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE 3.     Stock Plans and Share-Based Compensation

Under CSX's share-based compensation plans, awards consist of performance units, stock options, restricted stock units and restricted stock awards for management and stock grants for directors. Awards granted under the various programs are determined and approved by the Compensation and Talent Management Committee of the Board of Directors. Awards to the Chief Executive Officer are approved by the full Board and awards to senior executives are approved by the Compensation and Talent Management Committee. In certain circumstances, the Chief Executive Officer or delegate approves awards to management employees other than senior executives. The Board of Directors approves awards granted to CSX's non-management directors upon recommendation of the Governance and Sustainability Committee.

Share-based compensation expense for awards under share-based compensation plans and purchases made as part of the employee stock purchase plan is measured using the fair value of the award on the grant date and is recognized on a straight-line basis over the service period of the respective award or upon grant date to certain retirement-eligible employees whose agreements allow for continued vesting upon retirement. Forfeitures are recognized as they occur. Total pre-tax expense and income tax benefits associated with share-based compensation are shown in the table below. Income tax benefits include impacts from option exercises and the vesting of other equity awards.

Third QuartersNine Months
(Dollars in millions)2020201920202019
Share-Based Compensation Expense:
Performance Units$14 $8 6 $23 
Stock Options3 2 16 9 
Restricted Stock Units and Awards2 2 5 6 
Employee Stock Purchase Plan1 1 3 3 
Stock Awards for Directors  2 2 
Total Share-Based Compensation Expense$20 $13 $32 $43 
Income Tax Benefit$6 $6 $17 $41 
CSX Q3 2020 Form 10-Q p.11

Table of Contents
CSX CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE 3.     Stock Plans and Share-Based Compensation, continued

Long-term Incentive Plan
    In February 2020, the Company granted 218 thousand performance units to certain employees under a new long-term incentive plan ("LTIP") for the years 2020 through 2022, which was adopted under the CSX 2019 Stock and Incentive Award Plan.

    Payouts of performance units for the cycle ending with fiscal year 2022 will be based on the achievement of goals related to both operating income and free cash flow, in each case excluding non-recurring items as disclosed in the Company's financial statements. The cumulative operating income and cumulative free cash flow measures over the plan period will each comprise 50% of the payout and will be measured independently of the other.

    Grants were made in performance units, with each unit representing the right to receive one share of CSX common stock, and payouts will be made in CSX common stock. The payout range for participants will be between 0% and 200% of the target awards depending on Company performance against predetermined goals. Payouts for certain executive officers are subject to formulaic upward or downward adjustment by up to 25%, capped at an overall payout of 250%, based upon the Company's total shareholder return relative to specified comparable groups over the performance period. Participants will receive stock dividend equivalents declared over the performance period based on the number of performance units paid upon vesting. No significant grants were made during third quarters 2020 and 2019. The fair values of the performance units awarded during the nine months ended 2020 and 2019 were primarily calculated using a Monte-Carlo simulation model with the following weighted-average assumptions:

Nine Months
20202019
Weighted-average assumptions used:
Annual dividend yieldN/A1.4 %
Risk-free interest rate1.4 %2.5 %
Annualized volatility24.5 %27.6 %
Expected life (in years)2.92.9

Stock Options
    In February 2020, the Company granted approximately 1.3 million stock options along with the corresponding LTIP. The fair value of stock options on the date of grant was $18.88 per option, which was calculated using the Black-Scholes valuation model. These stock options were granted with ten-year terms and vest over three years in equal installments each year on the anniversary of the grant date. The exercise price for stock options granted equals the closing market price of the underlying stock on the date of grant. These awards are time-based and are not based upon attainment of performance goals. No options were granted during third quarter 2020. During third quarter 2019, there were immaterial grants of stock options to certain members of management.
CSX Q3 2020 Form 10-Q p.12

Table of Contents
CSX CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE 3.     Stock Plans and Share-Based Compensation, continued

    The fair values of all stock option awards during the quarters and nine months ended September 30, 2020 and September 30, 2019 were estimated at the grant date with the following weighted average assumptions:

Third QuartersNine Months
2020201920202019
Weighted-average grant-date fair valueN/A$15.44$18.87$17.99
Stock options valuation assumptions:
Annual dividend yieldN/A1.4 %1.2 %1.3 %
Risk-free interest rateN/A1.4 %1.4 %2.5 %
Annualized volatilityN/A25.7 %26.0 %25.7 %
Expected life (in years)N/A6.56.06.1
Other pricing model inputs:
Weighted-average grant-date market price of CSX stock (strike price)N/A$66.35$79.48$69.96

Restricted Stock Units
    In February 2020, the Company granted 91 thousand restricted stock units along with the corresponding LTIP. The restricted stock units vest three years after the date of grant. Participants will receive stock dividend equivalents on the vested shares upon vesting. These awards are time-based and are not based upon CSX's attainment of operational targets. Restricted stock units are paid out in CSX common stock on a one-for-one basis. For information related to the Company's other outstanding long-term incentive compensation, see CSX's most recent annual report on Form 10-K.

Employee Stock Purchase Plan
In May 2018, shareholders approved the 2018 CSX Employee Stock Purchase Plan (“ESPP”) for the benefit of Company employees. The Company registered 4 million shares of common stock that may be issued pursuant to this plan. Under the ESPP, employees may contribute between 1% and 10% of base compensation, after-tax, to purchase up to $25,000 of market value CSX common stock per year at 85% of the closing market price on either the grant date or the last day of the six-month offering period, whichever is lower. During third quarter and nine months ended September 30, 2020 and September 30, 2019, the company issued the following shares under this program:

Third QuartersNine Months
2020201920202019
Shares issued (in thousands)120 144 242 249 
Weighted average purchase price per share$59.28 $52.66 $60.40 $52.72 
CSX Q3 2020 Form 10-Q p.13

Table of Contents
CSX CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE 4.    Casualty, Environmental and Other Reserves

Personal injury and environmental reserves are considered critical accounting estimates due to the need for management judgment. Casualty, environmental and other reserves are provided for in the consolidated balance sheets as shown in the table below.

September 30, 2020December 31, 2019
(Dollars in millions)CurrentLong-termTotalCurrentLong-termTotal
Casualty:
Personal Injury$44 $85 $129 $42 $87 $129 
Occupational9