Union Pacific 2007 Annual Report Download - page 39

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assessments of market conditions and other pertinent facts guide the timing and volume of all repurchases.
We expect to fund our common stock repurchases through cash generated from operations, the sale or lease of
various operating and non-operating properties, debt issuances, and cash on hand at December 31, 2007.
During 2007, we repurchased approximately 13 million shares under this program at an aggregate purchase
price of approximately $1.5 billion. These shares were recorded in treasury stock at cost, which includes any
applicable commissions and fees.
Shelf Registration Statement and Significant New Borrowings – Our Board of Directors authorized the
issuance of up to $3 billion of debt securities pursuant to a new shelf registration statement, which became
effective on March 6, 2007, replacing the $500 million of authority remaining under our shelf registration filed
in December 2003. Under the current shelf registration, we may issue, from time to time, any combination of
debt securities, preferred stock, common stock, or warrants for debt securities or preferred stock in one or
more offerings.
We have issued the following unsecured, fixed-rate debt securities under our current shelf registration:
Date Description of Securities
Issued during 2007:
April 18, 2007................................................. $250 million of 5.65% Notes due May 1, 2017
April 18, 2007................................................. $250 million of 6.15% Debentures due May 1, 2037
August 24, 2007 ............................................. $500 million of 5.45% Notes due January 31, 2013
October 30, 2007............................................ $500 million of 5.75% Notes due November 15, 2017
Issued subsequent to 2007:
February 5, 2008 ............................................ $750 million of 5.70% Notes due August 15, 2018
The net proceeds from these offerings are for general corporate purposes, including the repurchase of
common stock pursuant to our share repurchase program. These debt securities include change-of-control
provisions. We have no immediate plans to issue equity securities; however, we will continue to explore
opportunities to replace existing debt or access capital through issuances of debt securities under our shelf
registration, and, therefore, we may issue additional debt securities at any time.
Operating Lease Activities
During 2007, the Railroad, as lessee, entered into long-term operating lease arrangements covering 259
locomotives and 150 rail cars, with a total equipment cost of approximately $538 million. In total, these new
lease arrangements will provide for minimum rental payments of approximately $831 million, with a present
value of approximately $434 million.
The lessors financed the purchase of the locomotives and freight cars, in part, by issuing equipment notes that
are non-recourse to the Railroad and are secured by assignments of the underlying leases and security interests
in the equipment. The Corporation and the Railroad do not guaranty payment of the equipment notes. The
Railroad’s obligations to make operating lease payments under the leases are recourse obligations and are not
recorded in the Consolidated Statements of Financial Position.
The Railroad has certain renewal and purchase options with respect to the locomotives and freight cars. If the
Railroad does not exercise these options, the equipment will be returned to the lessors at the end of the lease
term.