Union Pacific 2002 Annual Report Download

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Letter to
Shareholders
1625
PAGE Building
America Annual Report
on Form 10-K
Union Pacific Corporation 2002 Annual Report

Table of contents

  • Page 1
    Union Pacific Corporation 2002 Annual Report PA G E 1 Letter to Shareholders 6 Building America 25 Annual Report on Form 10-K

  • Page 2
    ... Financial Statements in Form 10-K). [b]Debt to capital employed is computed as follows: total debt divided by debt plus equity plus convertible preferred securities. Operating Revenues $ MILLIONS Operating Income $ MILLIONS Net Income $ MILLIONS $12,491 $2,324 $1,341 2002 Stock Price...

  • Page 3
    ... Pacific Corporation, and Ike Evans, president and chief operating officer, Union Pacific Railroad. These achievements resulted in record net income of $1.34 billion or $5.05 diluted earnings per share. Even excluding land sales to the Utah Transit Authority and Santa Clara Valley Transportation...

  • Page 4
    ...record levels for the "new" Union Pacific in 2002: Service Delivery Employee Productivity GTM (MIL) PER EMPLOYEE UP's Energy business generated 22 percent of all revenue. In 2002, UP hauled 241 million tons of coal, an all-time best. Index, Train Plan Compliance, Customer Satisfaction Index and To...

  • Page 5
    ... FRANCHISE LEVERAGES GROWTH Union Pacific is North America's largest railroad, covering the western two-thirds of the United States. This premier rail franchise serves large Gulf Coast chemical-producing and western coal-producing areas, all major West Coast ports and gateways to Mexico and Canada.

  • Page 6
    ... I've been privileged to work for Union Pacific for 43 years. I enjoy meeting with employees and discussing our company's future. This year, members of our senior team visited every service unit, talking to employees about their jobs and their ideas. We saw firsthand the building pride within the UP...

  • Page 7
    ... S S H A R E H O L D E R VA L U E By raising its dividend 15 percent, Union Pacific has signaled its confidence in the future. Union Pacific employees, such as Welder John Pribyl, left, Chairman Dick Davidson and Welder George Lawton, are proud of their role in keeping the nation's economy on track.

  • Page 8
    ... by new, more reliable models that reduce maintenance costs. The company is promoting industry alliances that give customers seamless service to all parts of North America. For example, in 2002 Union Pacific introduced new intermodal train service to Mexico for shippers in the eastern United States...

  • Page 9
    BUSINESS MIX PROVIDES STRENGTH Union Pacific's balanced and diverse traffic mix is a real strength that helps the railroad weather tough times. By creating new products and using quality processes to improve service reliability, UP is delivering value to its customers. 2002 REVENUE AUTOMOTIVE 11...

  • Page 10
    ..., Union Pacific introduced new intermodal train service to Mexico for shippers in the eastern United States that trims up to three days from previous rail transit times. part of the yield strategy is improving locomotive and car utilization. Outdated, inefficient locomotives have been retired and...

  • Page 11
    ... N O L O GY ST R E A M L I N E S L O C O M O T I V E O P E R AT I O N S Switchman Scott Thomason uses radio signals to direct onboard computers controlling locomotive movements in rail yard switching operations. This remote-control locomotive technology is proven to increase safety and productivity.

  • Page 12
    ..., Union Pacific is Building Service for customers. By retooling transportation plans and improving asset utilization in critical rail corridors, Union Pacific is strengthening performance across the entire rail network. For example, the I-5 Corridor linking Seattle to Los Angeles was Union Pacific...

  • Page 13
    ...I C E F O R G E S C U ST O M E R PA RT N E R S H I P S Responding to Union Pacific's local customer satisfaction survey, Ag Processing's Jack Hochard, right, recognized UP's Gary Nowlin and other railroad managers and switch crews for providing excellent service at AGP's St. Joseph, Missouri, plant.

  • Page 14
    ... using fewer assets. Transporting 80 percent of all new vehicles in the western United States, Union Pacific is offering customers reduced cycle times. For the Energy group, the Overland Corridor track capacity expansion has increased daily reliability for coal trains departing Wyoming's southern...

  • Page 15
    R E A L -T I M E DATA I M P ROV E S T R A I N M A N AG E M E N T Union Pacific managers Katy Henrichsen and Tyler Adamson access Web-focused, decision-support tools to better use assets and improve cycle times for 2,500 daily trains.

  • Page 16
    ... car Union Pacific's excellent service earned top awards from automakers DaimlerChrysler, General Motors, Toyota and UPS Autogistics, network manager for Ford. ride problem affecting auto parts. Working through the customer satisfaction issue won Union Pacific additional business. Union Pacific...

  • Page 17
    INGENUITY UNDERSCORES QUALITY AND EFFICIENCY Chicago Machinist George Ahlert's idea, which saved Union Pacific $275,000 annually, replaced a labor-intensive, customized welding process with an easy-to-install, green plastic wear pad that protects locomotive couplers.

  • Page 18
    ... sale of Union Pacific track and land to the Utah Transit Authority for a project that will increase passenger rail service. UP Foundation grants support many local organizations such as Harvesters, Kansas City's only food bank. From left are Harvesters employees Nathan Walden, Executive Director...

  • Page 19
    ... Y F O C U S E S O N E D U C AT I O N Supporting high school principals as they educate America's future work force, Union Pacific Foundation is sponsoring "The Principals' Partnership," a personalized leadership program, in addition to its traditional grant-giving to local charitable organizations.

  • Page 20
    ... business, Union Pacific is reinventing success, decade after decade. Productivity has increased at a compound annual rate of 7 percent since 1984, with no sign of slowing. Technology and quality processes enable employees to best use these critical resources - locomotives, freight cars, and track...

  • Page 21
    TEAMWORK BRINGS RECORD RESULTS Trackmen Zane Morris, left, and Eugene Stevens are members of Union Pacific's concrete tie gang, which uses teamwork and high-tech machines to enhance safety and improve productivity. Employees have reduced injury rates for the past three years.

  • Page 22
    ... long-haul freight. And, a major initiative to speed billing and collections culminated in an efficient, electronic, customer-friendly cash application system. It bills 98 percent of customers for transportation services within 72 hours of freight movement. Operating Ratios Improved transit times...

  • Page 23
    OV E R N I T E S E T S S E R V I C E STA N DA R D Overnite set an industry-leading, on-time service standard exceeding 97 percent for combined regional, inter-regional and long-haul freight, improving transit times on more than 4,000 lanes. Overnite increased its revenue over the previous 12 months,...

  • Page 24
    U N I O N PA C I F I C 22 U N I O N P A C I F I C

  • Page 25
    23 U N I O N PA C I F I C F R A N C H I S E

  • Page 26
    ... Vice President - Finance Union Pacific Corporation John J. Koraleski Executive Vice President Marketing and Sales Union Pacific Railroad Company Mary E. McAuliffe Vice President - External Relations Union Pacific Corporation Richard J. Putz Vice President and Controller Union Pacific Corporation...

  • Page 27
    ... ACT OF 1934 For the fiscal year ended December 31, 2002 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 1-6075 UNION PACIFIC CORPORATION (Exact name of registrant as specified in...

  • Page 28
    ...Item 14. Directors and Executive Officers of the Registrant...Executive Compensation ...Security Ownership of Certain Beneficial Owners and Management...Certain Relationships and Related Transactions...Controls and Procedures ...PART IV Item 15. Exhibits, Financial Statement Schedules and Reports on...

  • Page 29
    .... The Corporation's principal executive offices are located at 1416 Dodge Street, Room 1230, Omaha, NE 68179. The telephone number at that address is (402) 271-5777. The Corporation's common stock is listed on the New York Stock Exchange under the symbol "UNP". A copy of this Annual Report on Form...

  • Page 30
    ... Cargo. OTC is a major interstate trucking company specializing in less-than-truckload (LTL) shipments. OTC serves all 50 states and portions of Canada and Mexico through 170 service centers located throughout the United States providing regional, inter-regional and long haul service. OTC transports...

  • Page 31
    ...OTC's 12,534 employees. Employees at two Motor Cargo service centers located in North Salt Lake, Utah and Reno, Nevada, representing approximately 11% of Motor Cargo's total work force at 33 service centers, are covered by two separate collective bargaining agreements with unions affiliated with the...

  • Page 32
    ... of transportation, including motor carriers, ships, barges and pipelines. Competition is based primarily upon the rate charged and the transit time required, as well as the quality and reliability of the service provided. While the Railroad must build or acquire and maintain its rail system, trucks...

  • Page 33
    ... unionized or the terms and conditions in future labor agreements were renegotiated, the Corporation could experience a significant disruption of its operations and higher ongoing labor costs. General Economic Conditions - Several of the commodities transported by both the Railroad and trucking...

  • Page 34
    ... Financial Statements, Item 8, for additional information regarding the Corporation's properties. Rail Operations Track - The Corporation's rail operations utilize over 33,000 main line and branch line route miles in 23 states in the western two-thirds of the United States. The Corporation...

  • Page 35
    ... claims for personal injury, property damage and business interruption. Following the incident, forty lawsuits were filed in various courts, and thirty-eight of those cases were consolidated in the United States District Court for the District of Western Louisiana. The remaining two cases were filed...

  • Page 36
    ...failed to stop at a signal and struck a UPRR train that was properly occupying a crossing. The collision resulted in a release of diesel fuel from the fuel tanks of a Union Pacific locomotive, which was promptly reported and remediated. The Railroad received notice in January 2003 that the amount of...

  • Page 37
    ... 2002, the jury returned a verdict finding that the contract had not been breached by the railroads, and the judgment dismissing the case was entered by the court on September 16, 2002. Western filed a motion for new trial on September 30, 2002, which the railroads believe will be unsuccessful. UPRR...

  • Page 38
    ...-Corporate Relations Senior Vice President, General Counsel and Secretary Vice President-Taxes Vice President-External Relations Vice President and Controller Vice President and Treasurer President and Chief Operating Officer of the Railroad Vice Chairman of the Board of the Railroad Executive Vice...

  • Page 39
    ...products company. Mr. Gutschewski was elected Vice President-Taxes effective August 1998. Prior thereto, he was Assistant Vice President-Tax and Financial Management of the Railroad. Mr. Putz was elected Vice President and Controller of UPC and Chief Accounting Officer and Controller of the Railroad...

  • Page 40
    ... stock of the Corporation is traded on the New York Stock Exchange under the symbol "UNP". The following table sets forth, for the quarters indicated, the dividends declared and the high and low sales prices of the Corporation's common stock. 2002 - Dollars Per Share Dividends...Common stock price...

  • Page 41
    ... acquisitions of Motor Cargo as of November 30, 2001, Southern Pacific Rail Corporation as of October 1, 1996, Chicago and North Western Transportation Company as of May 1, 1995, and Skyway Freight Systems, Inc. as of May 31, 1993, and reflects the disposition of the Corporation's natural resources...

  • Page 42
    ... data related to many of the sites, and/or the speculative nature of remediation costs. Income Taxes - The Corporation accounts for income taxes in accordance with Statement of Financial Accounting Standards No. 109, "Accounting for Income Taxes" (FAS 109). The objectives of accounting for income...

  • Page 43
    ..., lower fuel prices and cost control efforts. Lower fuel prices for the Railroad of 73 cents per gallon in 2002 versus 88 cents per gallon in 2001, reduced fuel expense by $198 million in 2002. Salaries, wages and employee benefits increased $225 million (5%) compared to 2001. Excluding Motor Cargo...

  • Page 44
    ... subsidiary revenue from various non-railroad companies that are wholly owned or majority owned by the Railroad, revenue from the Chicago commuter rail operations and accessorial revenue earned due to customer detainment of railroad owned or controlled equipment. Rail operating revenues increased...

  • Page 45
    ... times. Offsetting the volume increase were reduced West Coast export shipments originating from the Colorado and Utah mining regions. Average revenue per car declined due to the impact of contract price negotiations on expiring long-term contracts with certain major customers. Industrial Products...

  • Page 46
    ...- Purchased services and other costs include the costs of services purchased from outside contractors, state and local taxes, net costs of operating facilities jointly used by UPRR and other railroads, transportation and lodging for train crew employees, trucking and contracting costs for intermodal...

  • Page 47
    ... contract transportation to handle the additional business of the former Consolidated Freightways. Depreciation expense increased $11 million (23%) compared to 2001. Excluding Motor Cargo in 2002 and 2001, expense increased $2 million (5%) due to purchases of new equipment. Fuel and utilities costs...

  • Page 48
    ... total value of the Corporation's assets subject to depreciation (see note 1 to the Consolidated Financial Statements, Item 8). Fuel and utilities costs were down $34 million (3%) compared to 2000 due to lower fuel prices and a lower fuel consumption rate, partially offset by higher gross ton miles...

  • Page 49
    ...average revenue per car. Materials volumes declined 16%, as the soft economy and a decline in vehicle sales led to high inventories, low industry production and auto plant shutdowns. Total finished vehicle shipments declined only 1%, as industry weakness was mitigated by market share gains. Consumer...

  • Page 50
    ...essentially flat. Higher expenses as a result of inflation, higher equipment rents expense and depreciation were offset by savings from lower force levels, productivity gains and cost control efforts and lower fuel prices. Salaries, Wages and Employee Benefits - Salaries, wages and employee benefits...

  • Page 51
    ... bad debt, insurance and cargo loss and damage expenses. Other costs decreased $11 million (10%) due to lower expenses related to decreased security (related to Teamsters' matters), legal and employee travel expenses in 2001. Operating Income - Trucking operations generated operating income of $54...

  • Page 52
    .... Receivables sold as of December 31, 2002 were $600 million. Access to commercial paper is dependent on market conditions. Deterioration of the Corporation's operating results or financial condition due to internal or external factors could negatively impact the Corporation's ability to utilize...

  • Page 53
    ...at fixed prices and fixed volumes. These commitments are made in order to take advantage of pricing opportunities and to insure availability of assets to meet quality and operational requirements. Excluded are annual contracts made in the normal course of business for performance of routine services...

  • Page 54
    ... Consolidated Financial Statements, Item 8). In December 2001, the Railroad entered into a synthetic operating lease arrangement to finance a new headquarters building, which will be constructed in Omaha, Nebraska. The expected completion date of the building is mid-2004. It will total approximately...

  • Page 55
    ... on the Kansas City Southern Railroad. The BLE is now working on a possible merger with the International Brotherhood of Teamsters (Teamsters). Trucking - During 2002, OTC continued to oppose the efforts of the Teamsters to unionize OTC service centers. On February 11, 2002, the United States Court...

  • Page 56
    ...also use swaptions to secure near-term swap prices. Swaptions are swaps that are extendable past their base period at the option of the counterparty. Swaptions do not qualify for hedge accounting treatment and are marked-to-market through the Consolidated Statements of Income. Market and Credit Risk...

  • Page 57
    ... secure more favorable swap prices. As of December 31, 2002, expected rail fuel consumption for 2003 is 7% hedged at 58 cents per gallon, excluding taxes, transportation costs and regional pricing spreads. As of December 31, 2002, the Railroad has no outstanding hedges for 2004. Based on annualized...

  • Page 58
    ... remediation of various sites. A discussion of certain claims, lawsuits, contingent liabilities and guarantees is set forth in note 10 to the Consolidated Financial Statements, Item 8. Pensions - During the second quarter of 2002, the Corporation decreased its assumed rate of return on pension plan...

  • Page 59
    ... new, innovative rail service offerings to meet the changing needs of its customers. While operating expenses will likely increase for such items as insurance, pension, operating taxes and minimum guaranteed payments to union employees, cost controls and continuing improvements in productivity...

  • Page 60
    ... general economic conditions, both within the United States and globally; any adverse economic or operational repercussions from terrorist activities and any governmental response thereto; war or risk of war; changes in fuel prices; changes in labor costs; labor stoppages; and the outcome of claims...

  • Page 61
    Item 8. Financial Statements and Supplementary Data Index to Consolidated Financial Statements Independent Auditors' Report...Consolidated Statements of Income For the Years Ended December 31, 2002, 2001 and 2000 ...Consolidated Statements of Financial Position At December 31, 2002 and 2001......

  • Page 62
    ... statement schedule based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free...

  • Page 63
    CONSOLIDATED STATEMENTS OF INCOME Union Pacific Corporation and Subsidiary Companies Millions, Except Per Share Amounts, for the Years Ended December 31, Rail, trucking and other ...Salaries, wages and employee benefits...Equipment and other rents...Depreciation ...Fuel and utilities ...Materials ...

  • Page 64
    ... to affiliated companies...Other investments...Total ...Properties Cost...Accumulated depreciation...Net ...Other Other assets ...Total assets...Liabilities and Common Shareholders' Equity Current Liabilities Accounts payable...Accrued wages and vacation ...Accrued casualty costs ...Income and other...

  • Page 65
    ... at end of year ...Accounts receivable, net...Inventories...Other current assets ...Accounts, wages and vacation payable ...Other current liabilities ...Total ...Supplemental cash flow information: Cash paid during the year for: Interest ...Income taxes, net...Non-cash transaction: Acquisition of...

  • Page 66
    ...,975 shares issued at the end of 2000. Balance at end of year, shares at cost: 21,920,238 in 2002; 25,208,819 in 2001; 28,413,483 in 2000. The Corporation utilized approximately 1.7 million shares of treasury stock in the acquisition of Motor Cargo Industries, Inc. Other comprehensive income (loss...

  • Page 67
    ...market value of the underlying common stock on the date of grant. Stock-based employee compensation expense related to restricted stock and other incentive plans is reflected in net income. The following table illustrates the effect on net income and earnings per share if the Corporation had applied...

  • Page 68
    ...-related expenses associated with pensions and postretirement health benefits. In order to measure the expense associated with these benefits, management must make various estimates including discount rates used to value certain liabilities, assumed rates of return on plan assets used to fund...

  • Page 69
    ... and Motor Cargo. OTC is a major interstate trucking company specializing in less-than-truckload (LTL) shipments. OTC serves all 50 states and portions of Canada and Mexico through 170 service centers located throughout the United States providing regional, inter-regional and long haul service. 43

  • Page 70
    ... Motor Cargo believe they are able to compete effectively in their markets by providing high quality, customized service at competitive prices. Employees - During 2002, OTC continued to oppose the efforts of the Teamsters to unionize OTC service centers. On February 11, 2002, the United States Court...

  • Page 71
    ... financial information for the Corporation's segments and other product lines for the years ended December 31, 2002, 2001 and 2000: Millions of Dollars Operating revenues:[a] Rail ...Trucking...Other...Consolidated ...Depreciation: Rail ...Trucking...Other...Consolidated ...Operating income...

  • Page 72
    ...also use swaptions to secure near-term swap prices. Swaptions are swaps that are extendable past their base period at the option of the counterparty. Swaptions do not qualify for hedge accounting treatment and are marked-to-market through the Consolidated Statements of Income. Market and Credit Risk...

  • Page 73
    ...2002[a] ...Average price of 2002 hedges outstanding (per gallon)[b] ...Number of gallons hedged for 2003[c] ...Average price of 2003 hedges outstanding (per gallon)[b] ...[a] [b] [c] Fuel hedges which were in effect during 2002. Excluded taxes, transportation costs and regional pricing spreads. Fuel...

  • Page 74
    ...and $850 million, respectively, of fixed-rate debt securities contain call provisions that allow the Corporation to retire the debt instruments prior to final maturity subject, in certain cases, to the payment of premiums. Sale of Receivables - The Railroad has sold, on a 364-day revolving basis, an...

  • Page 75
    ... tax asset ...Excess tax over book depreciation ...State taxes, net ...Retirement benefits ...Alternative minimum tax credits ...Net operating loss...Other ...Net long-term deferred income tax liability...Net deferred income tax liability...2002 $ (346) (211) (557) 8,190 609 (337) (140) 156 8,478...

  • Page 76
    ... $9.4 billion, respectively, of Railroad properties secure outstanding equipment obligations and mortgage bonds. Credit Facilities - The Corporation had no commercial paper borrowings outstanding as of December 31, 2002. Commercial paper is issued from time to time for working capital needs and is...

  • Page 77
    .... The Corporation has no immediate plans to issue equity securities. During June 2002, UPRR entered into a capital lease covering new locomotives. The related capital lease obligation totaled approximately $126 million and is included in the Consolidated Statements of Financial Position as...

  • Page 78
    ...and life insurance programs for retirees. The Corporation also provides medical and life insurance benefits on a cost sharing basis for qualifying employees. These costs are funded as incurred. Pension Plans - The Corporation provides defined benefit retirement income to eligible non-union employees...

  • Page 79
    ... asset returns for the Corporation's pension plans were adversely impacted by continued deterioration in the equity markets. Actual return on pension plan assets was approximately negative 10% in 2002. During the same time, corporate bond yields, which are used in determining the discount rate for...

  • Page 80
    ... 9.0 10.0 3.75 4.25 N/A N/A N/A N/A Other Postretirement Benefits 2002 2001 2000 6.75% 7.25% 7.50% N/A N/A N/A 3.75 4.25 4.50 10.00 5.00 7.70 5.50 7.70 5.50 Percentages Discount rate ...Expected return on plan assets...Rate of compensation increase...Health care cost trend: Current ...Level in 2008...

  • Page 81
    ... non-employee director receives annually an option to purchase a number of shares of UPC common stock, not to exceed 5,000 shares during any calendar year, determined by dividing 60,000 by 1/3 of the fair market value of one share of UPC common stock on the date of such Board of Directors meeting...

  • Page 82
    ...prescribed stock price or other financial criteria is not met. Restricted stock awards are issued to non-employee directors and are subject to forfeiture if certain service requirements are not met. During the year ended December 31, 2002, 804,956 retention shares, stock units, and restricted shares...

  • Page 83
    ... ultimate cost and number of incidents each year. During 2002, the Railroad's reported number of work-related injuries that resulted in lost job time decreased 5% compared to the number of injuries reported during 2001, and accidents at grade crossings decreased 16% compared to 2001. Annual expenses...

  • Page 84
    ...in Omaha, Nebraska. The expected completion date of the building is mid-2004. It will total approximately 1.1 million square feet with approximately 3,800 office workspaces. The cost to construct the new headquarters, including capitalized interest, is approximately $260 million. The Corporation has...

  • Page 85
    ... Corporation has a legal obligation to remove the asset. The standard will affect the way the Corporation accounts for track structure removal costs, but will have no impact on liquidity. The Corporation is currently evaluating the impact of this statement on the Corporation's Consolidated Financial...

  • Page 86
    ... 2,000 Railroad positions during 2001. The Corporation accrued $115 million pretax or $72 million after-tax in the fourth quarter of 2000 for costs related to the Plan. The expense was charged to salaries, wages and employee benefits in the Corporation's 2000 Consolidated Statements of Income. Plan...

  • Page 87
    ...Senior Financial Officers of Registrant. The Board of Directors of UPC adopted the UPC Code of Ethics for the Chief Executive Officer and Senior Financial Officers (the "Code") on January 30, 2003. A copy of the Code may be found on the Internet at the Corporation's website www.up.com/investors. The...

  • Page 88
    ... the Overnite Transportation Company Employee Stock Purchase Plan (OTC ESPP) and the Motor Cargo Industries, Inc. Employee Stock Purchase Plan (Motor Cargo ESPP) are the only equity compensation plans of UPC not approved by shareholders. The UP Shares Plan was approved by UPC's Board of Directors on...

  • Page 89
    ... as part of this filing are listed on the index to Consolidated Financial Statements, Item 8, on page 35. (2) Financial Statement Schedules Schedule II - Valuation and Qualifying Accounts Schedules not listed above have been omitted because they are not applicable or not required or the information...

  • Page 90
    ... authorized, on this 21st day of February, 2003. UNION PACIFIC CORPORATION By /s/ Richard K. Davidson Richard K. Davidson, Chairman, President, Chief Executive Officer and Director Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below, on this 21st...

  • Page 91
    ... OF PRINCIPAL EXECUTIVE OFFICER I, Richard K. Davidson, certify that: 1. I have reviewed this annual report on Form 10-K of Union Pacific Corporation; 2. Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to...

  • Page 92
    ... OF PRINCIPAL FINANCIAL OFFICER I, James R. Young, certify that: 1. I have reviewed this annual report on Form 10-K of Union Pacific Corporation; 2. Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to...

  • Page 93
    ... ...Charged to expense...Cash payments and other reductions ...Balance, end of period ...Accrued casualty costs are presented in the Consolidated Statements of Financial Position as follows: Current ...Long-term ...Balance, end of period ...2002 $ 150 28 (37) $ 141 $ 1,148 414 (419) $ 1,143 2001...

  • Page 94
    Union Pacific Corporation Exhibit Index Exhibit No. Filed with this Statement 3(a) 10(a) 10(b) By-laws of UPC, as amended, effective as of January 1, 2003. The Executive Stock Purchase Incentive Plan of UPC, as amended November 21, 2002. Overnite Transportation Company Employee Stock Purchase Plan, ...

  • Page 95
    ...Prospectus included in Post-Effective Amendment No. 2 to UPC's Registration Statement on Form S-4 (No. 33-64707). Amended and Restated Registration Rights Agreement, dated as of July 12, 1996, among UPC, UP Holding Company, Inc., Union Pacific Merger Co. and Southern Pacific Rail Corporation (SP) is...

  • Page 96
    ... Long Term Plan Stock Unit and Cash Award Agreement dated January 25, 2001, is incorporated herein by reference to Exhibit 10(u) to the Corporation's Annual Report of Form 10-K for the year ended December 31, 2000. Motor Cargo Industries, Inc. Employee Stock Purchase Plan, dated November 21, 2002...

  • Page 97
    ... (earnings) loss ...Total earnings ...Income taxes ...Fixed charges: Interest expense including amortization of debt discount ...Portion of rentals representing an interest factor ...Total fixed charges...Earnings available for fixed charges ...Ratio of earnings to fixed charges ...[a] 2002 $ 1,341...

  • Page 98
    Exhibit 21 SIGNIFICANT SUBSIDIARIES OF UNION PACIFIC CORPORATION Name of Corporation Union Pacific Railroad Company ...Southern Pacific Rail Corporation ...Overnite Transportation Company ...State of Incorporation Delaware Utah Virginia 72

  • Page 99
    ... Amendment No.1 to Registration Statement No. 333-88666 on Forms S-3 of our report dated January 22, 2003, appearing in this Annual Report on Form 10-K of Union Pacific Corporation for the year ended December 31, 2002. /s/ Deloitte & Touche LLP DELOITTE & TOUCHE LLP Omaha, Nebraska February 21, 2003...

  • Page 100
    ...-in-fact and agent, to sign on my behalf the Corporation's Annual Report on Form 10-K for the year ended December 31, 2002, and any and all amendments thereto, and to file the same, with all exhibits thereto, with the Securities and Exchange Commission. IN WITNESS WHEREOF, I have executed this Power...

  • Page 101
    ...-in-fact and agent, to sign on my behalf the Corporation's Annual Report on Form 10-K for the year ended December 31, 2002, and any and all amendments thereto, and to file the same, with all exhibits thereto, with the Securities and Exchange Commission. IN WITNESS WHEREOF, I have executed this Power...

  • Page 102
    ... ACT OF 2002 In connection with the accompanying Annual Report of Union Pacific Corporation (the Corporation) on Form 10-K for the period ending December 31, 2002 as filed with the Securities and Exchange Commission on the date hereof (the Report), I, James R. Young, Executive Vice President-Finance...

  • Page 103
    ... and Exchange Commission (SEC) filings, corporate governance materials (Board Committee charters, governance guidelines and policies, and codes of business conduct and ethics for directors, officers and employees), news releases, investor fact books and other general information about Union Pacific...

  • Page 104