Union Pacific 2012 Annual Report Download - page 37

37
Share Repurchase Program
Effective April 1, 2011, our Board of Directors authorized the repurchase of 40 million shares of our
common stock by March 31, 2014, replacing our previous repurchase program. As of December 31,
2012, we repurchased a total of $7.1 billion of our common stock since the commencement of our
repurchase programs. The table below represents shares repurchased under the new repurchase
program, except for the first quarter of 2011 which represent shares repurchased under the previous
program.
Number of Shares Purchased
A
verage Price Paid
2012 2011 2012 2011
First quarter 3,917,369 2,636,178 $ 110.64 $ 94.10
Second quarter 3,770,528 3,576,399 110.02 100.75
Third quarter 3,098,812 4,681,535 122.13 91.45
Fourth quarter 2,033,750 3,885,658 121.81 98.16
Total 12,820,459 14,779,770 $ 115.01 $ 95.94
Remaining number of shares that may be repurchased under current authority 15,035,949
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Management's assessments of market conditions and other pertinent facts guide the timing and volume
of all repurchases. We expect to fund any share repurchases under this program through cash generated
from operations, the sale or lease of various operating and non-operating properties, debt issuances, and
cash on hand. Repurchased shares are recorded in treasury stock at cost, which includes any applicable
commissions and fees.
Shelf Registration Statement and Significant New Borrowings – Under our 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 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.
During 2012, we issued the following unsecured, fixed-rate debt securities under our current shelf
registration:
Date Description of Securities
June 11, 2012 $300 million of 2.95% Notes due January 15, 2023
$300 million of 4.30% Notes due June 15, 2042
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We used the net proceeds from the offering for general corporate purposes, including the repurchase of
common stock pursuant to our share repurchase program. These debt securities include change-of-
control provisions. At December 31, 2012, we had remaining authority to issue up to $1.4 billion of debt
securities under our shelf registration.
On May 22, 2012, we borrowed $100 million under a 4-year-term loan (the loan). The loan has a floating
rate based on London Interbank Offered Rates, plus a spread, and is prepayable in whole or in part
without a premium prior to maturity. The agreement documenting the loan has provisions similar to our
revolving credit facility, including identical debt-to-net-worth covenant and change of control provisions
and similar customary default provisions. The agreement does not include any other financial restrictions,
credit rating triggers, or any other provision that would require us to post collateral.
During the third and fourth quarters of 2012, we acquired 343 locomotives by exercising early buy-out
rights in certain operating and capital lease agreements. Following the acquisition of the locomotives, we
sold them to financing parties and entered into capital lease financing agreements with these parties. We
did not recognize any gains or losses as a result of these transactions. Capital lease obligations totaling
$286 million are reported in our Consolidated Statements of Financial Position as debt at December 31,
2012.