<PAGE> COVER
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
_______________________________
(Mark One)
[ X ] ANNUAL REPORT PURSUANT TO SECTION 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended December 31, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from _____________ to ________________
Commission file number 1-6075
A. Full title of the plan and the address of the plan if different
from that of the issuer named below:
CHICAGO AND NORTH WESTERN RAILWAY COMPANY
PROFIT SHARING AND RETIREMENT SAVINGS PROGRAM
B. Name of issuer of the securities held pursuant to the plan and the
address of its principle executive office:
UNION PACIFIC CORPORATION
Martin Tower
Eighth and Eaton Avenues
Bethlehem, PA 18018
<PAGE>
Financial Statements and Exhibits
(a) Financial Statements
See Table of Contents to Financial Statements on Page F-1
(b) Exhibits
23 - Independent Auditors' Consent
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
trustees (or other persons who administer the employee benefit plan) have duly
caused this Annual Report to be signed on its behalf by the undersigned
hereunto duly authorized.
Dated: August 26, 1996
Chicago and North Western Railway Company
Profit Sharing and Retirement Savings Program
By: /s/ Gary M. Stuart
_____________________________________
Gary M. Stuart, Member of the Investment
Committee of the Plan and Vice President
and Treasurer of Union Pacific Corporation
<PAGE> F-1
CHICAGO AND NORTH WESTERN RAILWAY COMPANY
PROFIT SHARING AND RETIREMENT SAVINGS PROGRAM
TABLE OF CONTENTS
Page
----
INDEPENDENT AUDITORS' REPORT F-2
FINANCIAL STATEMENTS AS OF DECEMBER 31, 1995 AND 1994
AND FOR THE YEARS THEN ENDED:
Statements of Net Assets Available for Benefits F-3
Statements of Changes in Net Assets Available for Benefits F-4
Notes to Financial Statements F-5 - F-10
SUPPLEMENTAL SCHEDULES AS OF DECEMBER 31, 1995
AND FOR THE YEAR THEN ENDED:
Item 27a - Schedule of Assets Held for Investment Purposes F-11
Item 27d - Schedule of Reportable Transactions F-12
Schedules not filed herewith are omitted because of the absence of the
conditions under which they are required.
<PAGE> F-2
INDEPENDENT AUDITORS' REPORT
Chicago and North Western Railway Company
Profit Sharing and Retirement Savings Program Committee
We have audited the accompanying statements of net assets available for
benefits of the Chicago and North Western Railway Company Profit Sharing and
Retirement Savings Program (the Program) as of December 31, 1995 and 1994, and
the related statements of changes in net assets available for benefits for the
years then ended. These financial statements are the responsibility of the
Plan's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, such financial statements present fairly, in all material
respects, the net assets available for benefits of the Program as of December
31, 1995 and 1994, and the changes in net assets available for benefits for
the years then ended in conformity with generally accepted accounting
principles.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules listed in
the Table of Contents are presented for the purpose of additional analysis and
are not a required part of the basic financial statements, but are
supplementary information required by the Department of Labor's Rules and
Regulations for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974. These schedules are the responsibility of the Program's
management. Such supplemental schedules have been subjected to the auditing
procedures applied in the audit of the basic 1995 financial statements and, in
our opinion, are fairly stated in all material respects when considered in
relation to the basic financial statements taken as a whole.
/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP
Omaha, Nebraska
August 20, 1996
<PAGE> F-3
<TABLE>
<CAPTION>
CHICAGO AND NORTH WESTERN RAILWAY COMPANY
PROFIT SHARING AND RETIREMENT SAVINGS PROGRAM
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1995 AND 1994
- -----------------------------------------------------------------------------
1995 1994
<S> <C> <C>
ASSETS
CASH AND SHORT TERM INVESTMENTS $ 2,181,488 $ 2,351
------------ ------------
INTEREST RECEIVABLE 1,174,864 2,029,503
------------ ------------
INVESTMENTS, at fair value (Note 3):
Mutual Funds 77,615,363 69,216,051
Pooled Funds 205,131 202,464
Common Stock 410,469 268,250
------------ ------------
78,230,963 69,686,765
INVESTMENTS, at contract value (Note 4):
Investment contract with insurance
company 56,645,221 51,746,309
------------ ------------
Total Investments 134,876,184 121,433,074
------------ ------------
RECEIVABLES:
Employer's contribution 5,717,530 5,655,934
Participants' contributions 107,898 752,430
------------ ------------
Total Receivables 5,825,428 6,408,364
------------ ------------
Total Assets 144,057,964 129,873,292
------------ ------------
LIABILITIES
ACCRUED EXPENSES 77,072 68,583
------------ ------------
NET ASSETS AVAILABLE FOR BENEFITS $143,980,892 $129,804,709
============ ============
The accompanying notes are an integral part of these financial statements.
</TABLE>
<PAGE> F-4
<TABLE>
<CAPTION>
CHICAGO AND NORTH WESTERN RAILWAY COMPANY
PROFIT SHARING AND RETIREMENT SAVINGS PROGRAM
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEARS ENDED DECEMBER 31, 1995 AND 1994
- -----------------------------------------------------------------------------
1995 1994
<S> <C> <C>
ADDITIONS TO NET ASSETS
ATTRIBUTABLE TO:
Investment income:
Net appreciation (depreciation)
in fair value of investments
(Note 3) $ 15,146,687 $ (6,780,159)
Interest and dividend income 11,656,419 10,454,838
------------ ------------
26,803,106 3,674,679
------------ ------------
Contributions:
Employer 5,937,720 5,655,934
Participants' 3,240,538 3,925,490
------------ ------------
Total Additions 35,981,364 13,256,103
------------ ------------
DEDUCTIONS FROM NET ASSETS
ATTRIBUTABLE TO:
Distributions to participants 21,223,637 4,913,662
Administrative expenses 77,072 68,583
------------ ------------
Total Deductions 21,300,709 4,982,245
TRANSFERS TO SUPPLEMENTAL PENSION PLAN 504,472 --
------------ ------------
NET INCREASE 14,176,183 8,273,858
NET ASSETS AVAILABLE FOR BENEFITS:
Beginning of Year 129,804,709 121,530,851
------------ ------------
End of Year $143,980,892 $129,804,709
============ ============
The accompanying notes are an integral part of these financial statements.
</TABLE>
<PAGE> F-5
CHICAGO AND NORTH WESTERN RAILWAY COMPANY
PROFIT SHARING AND RETIREMENTS SAVINGS PROGRAM
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1995 AND 1994
- -----------------------------------------------------------------------------
1. DESCRIPTION OF PROGRAM
The following description of the Chicago and North Western Railway
Company Profit Sharing and Retirement Savings Program (the Program),
prior to the adoption of amendments as discussed in Note 11, provides
only general information. Participants should refer to the Program
document for a more complete description of the Program's provisions.
General - The Program was initially established to provide retirement
benefits to eligible employees of Chicago and North Western Railway
Company (the Company) and other common control employers who adopt the
Program. It is subject to the provisions of the Employee Retirement
Income Security Act of 1974 (ERISA), as amended.
Contributions - Participants may contribute up to 15% of their
compensation on a salary or non-salary deferral basis subject to
limitations specified in the Internal Revenue Code. The Company matches
the Employee Contributions at a rate of 20% computed on an amount up to
the first 5% of the employee's salary contributed. This minimum employer
contribution represents the first step in the method discussed below.
The amount of the Company's annual contribution is determined based upon
the Company's profit, or, if larger, based upon the amount of the
employee contributions. Employer contributions are allocated on a four
step basis, subject to Internal Revenue Code limitations:
1) The employer contribution is allocated to those employees making
employee contributions by matching up to 20% of the amount of each
participant's employee contributions for each Program year up to a
maximum base of 5% of the employee's salary contributed;
2) If any employer contribution remains unallocated, such amount is
allocated to employees in proportion to the amount by which their
compensation (to the salary maximum) exceeds the wage base subject
to Railroad Retirement Tax, as defined in Section 3121a of the
Internal Revenue Code, with a maximum employer contribution up to
11.4% (or, up to 12% if IRS regulations permit) of such excess
amount for each Program year;
3) If any employer contribution remains unallocated, such amount is
allocated to employees making employee contributions by matching up
to 20% of the amount of each participant's employee contributions
for each Program year up to a maximum base of 5% of the employee's
salary contributed;
4) If any employer contribution remains unallocated, such amount is
allocated in proportion to each employee's total compensation (up to
the salary maximum) for each Program year.
As indicated above, step (2) in the employer contribution allocation
formula can provide up to 11.4% of the pay received by a participant in
excess of the Railroad Retirement Tax taxable wage base. This is the
only step of the allocation formula which integrates with Railroad
Retirement.
Participant Accounts - Each participant account is credited with the
participant's contributions and an allocation of the Plan's earnings.
Allocations are based on participant account balances.
<PAGE> F-6
Vesting - A participant is fully vested if he/she:
1) Reached his/her 65th birthday; or
2) Is involuntarily terminated without cause as determined by the
Committee, in accordance with established Company policies if such
termination occurs on or after his/her 60th birthday; or
3) Reached his/her 60th birthday and has at least 5 years of service;
or
4) Has a disability or dies; or
5) Has a termination of employment on account of a force reduction; or
6) Has five years of service
Payment of Benefits - Under the terms of the Program, benefits are to be
paid in the form of a joint and survivor annuity. Assets of a
participant's account may, as determined by the participant (with spousal
consent when required), be paid to him in a lump sum or in installments.
In order to provide a joint and survivor annuity (or single life annuity
where spousal consent is obtained or there is no spouse) assets of the
participant's account are transferred to the Chicago and North Western
Railway Company Supplemental Pension Plan for payment of the annuity.
The annuity may, at the option of the Program administrator, be purchased
from a third party institution or paid from the assets of the
Supplemental Pension Plan.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting -The accompanying financial statements are prepared
under the accrual method of accounting.
Investment Valuation and Income Recognition - The Program's investments
are stated at fair value except for its investment contract with an
insurance company which is valued at contract value (Note 4). If
available, quoted market prices are used to value investments. The
amounts shown in Note 3 for securities that have no quoted market price
represent estimated fair value as determined by Vanguard Fiduciary Trust
Company. Purchase and sales of securities are recorded on the trade-date
basis. Interest income is recorded on the accrual basis. Dividends are
recorded on the ex-dividend basis.
Administrative Expenses - All administrative expenses of the Program with
the exception of investment management fees are paid by the Company.
Investment management fees are paid by the Program.
3. INVESTMENTS
Program participants may direct their contributions in various
proportions to either Fund B or Fund C. Participant unmatched
contributions prior to 1987 may be invested in either Fund D or Fund E,
in accordance with participant directions.
Fund B - Based upon Program guidelines, this Fund shall be invested in
common stocks, similar equity securities, or other similar investments
including, but not limited to, bank pooled or common funds, mutual funds
or insurance company separate accounts. At December 31, 1995 and 1994,
assets in this Fund were invested primarily in Vanguard Windsor Fund
Incorporated and Vanguard Index Trust 500 Portfolio mutual funds.
<PAGE> F-7
Fund C - Based upon Program guidelines, this Fund shall be invested in
contracts issued by an insurance company, and upon determination by the
Board of Directors, would also include, but not be limited to, guaranteed
income contracts, group annuity contracts, immediate participation
guarantee contracts, or deposit administration contracts. At December
31, 1995 and 1994, assets in this Fund were invested primarily in a
guaranteed insurance contract with Northwestern National Life Insurance
Company.
Fund D - Based upon Program guidelines, this Fund shall be invested and
is currently invested primarily in the Windsor Fund maintained by the
Vanguard Group of Investment Companies.
Fund E - Based upon the Program guidelines, this Fund shall be invested
and is currently invested primarily in the Vanguard Money Market Reserves
Prime Portfolio.
Except for its investment contract with an insurance company (Note 4),
the following table presents the fair value of investments. Investments
that represent 5% or more of the Program's net assets are separately
identified.
<TABLE>
<CAPTION>
December 31, 1995 December 31, 1994
------------------------- ----------------------
Number Fair Number Fair
of Units Value of Units Value
<S> <C> <C> <C> <C>
Investments at Fair Value
as Determined by Quoted
Market Price:
Vanguard Windsor Fund
Incorporated 3,841,686 $55,819,700 5,497,701 $69,216,051
Vanguard Index Trust
500 Portfolio 376,241 21,795,663 -- --
Common stock 9,250 410,469 9,250 268,250
----------- -----------
78,025,832 69,484,301
Investments at Estimated
Fair Value:
Vanguard Money Market
Reserves 205,131 205,131 202,464 202,464
----------- -----------
$78,230,963 $69,686,765
=========== ===========
</TABLE>
During 1995 and 1994, the Program's investments (including investments bought,
sold, and held during the year) appreciated (depreciated) in value by
$15,146.687 and $(6,780,159), respectively, as follows:
<TABLE>
<CAPTION>
Years Ended December 31,
-----------------------------
1995 1994
<S> <C> <C>
Net Change in Fair Value
Investments at Fair Value as Determined by
Quoted Market Price:
Mutual Funds $15,004,468 $(6,752,409)
Common Stock 142,219 (27,750)
----------- -----------
Net change in fair value $15,146,687 $(6,780,159)
=========== ===========
</TABLE>
<PAGE> F-8
4. INVESTMENT CONTRACT WITH INSURANCE COMPANY
The Program has entered into a benefit responsive investment contract
with Northwestern National Life Insurance Company (Northwestern
National). This contract is included in the financial statements at
contract value, which approximates fair value. Contract value represents
contributions made under the contract, plus earnings, less Program
withdrawals and administrative expenses. Northwestern National maintains
the contributions in a pooled account. The crediting interest rate under
this contract at December 31, 1995 and 1994, and for the years then ended
was 8%. Under this contract a penalty may be incurred for early
withdrawal from the contract by the plan sponsor, plan termination and
various other employer initiated events.
5. PROGRAM ADMINISTRATION
The Chicago and North Western Railway Company Profit Sharing and
Retirement Savings Program Committee (the Committee) serves as
administrator of the Program. All expenses incurred in the administration
of the Program are paid by the Company.
6. TAX STATUS
The Program obtained a tax determination letter dated April 16, 1996, in
which the Internal Revenue Service stated that the Program, as amended
through October 24, 1995, was in compliance with the applicable
requirements of the Internal Revenue Code (the Code). The Program has
been amended since receiving the determination letter. However, Program
management believes that the program currently is being operated in
compliance with the applicable requirement of the Internal Revenue Code.
Therefore, it is believed that the Program was qualified and the related
trust was tax-exempt under provisions of Section 501(a) of the Internal
Revenue Code as of the financial statement date. Therefore, no provision
for income taxes has been included in the Program's financial statements.
7. PLAN TERMINATION
Although it has not expressed any intent to do so, the Company has the
right under the Program at any time, to terminate the Program subject to
the provisions of ERISA. Regardless of such actions, the principal and
income of the Program remains for the exclusive benefit of the Program's
participants and beneficiaries. The Company may direct the Trustee
either to distribute the Program's assets to the participants, or to
continue the Trust and distribute benefits as though the Program had not
been terminated.
8. CHANGE OF PROGRAM NAME
Effective May 23, 1994, the Program's name was changed to Chicago and
North Western Railway Company Profit Sharing and Retirement Savings
Program from Chicago and North Western Transportation Company Profit
Sharing and Retirement Savings Program.
<PAGE> F-9
9. FUND INFORMATION
Net assets, participant contributions, withdrawals and investment income
by fund are as follows for the years ended December 31, 1995 and 1994:
<TABLE>
<CAPTION>
1995 1994
<S> <C> <C>
Net Assets
Fund B $ 82,326,722 $ 72,645,794
Fund C 60,388,841 56,089,006
Funds D and E 1,265,329 1,069,909
------------ ------------
Total $143,980,892 $129,804,709
============ ============
Employer contributions:
Fund B $ 3,806,945 $ 3,785,707
Fund C 2,130,775 1,870,227
Funds D and E -- --
------------ ------------
Total $ 5,937,720 $ 5,655,934
============ ============
Employee contributions:
Fund B $ 2,175,610 $ 2,692,725
Fund C 1,064,928 1,232,765
Funds D and E -- --
------------ ------------
Total $ 3,240,538 $ 3,925,490
============ ============
Distributions to participants:
Fund B $ 10,506,455 $ 2,699,164
Fund C 10,649,493 2,015,713
Funds D and E 67,689 198,785
------------ ------------
Total $ 21,223,637 $ 4,913,662
============ ============
Investment Income
Fund B $ 21,814,453 $ (226,193)
Fund C 4,725,544 3,886,907
Funds D and E 263,109 13,965
------------ ------------
Total $ 26,803,106 $ 3,674,679
============ ============
</TABLE>
10. MERGER AGREEMENT
On March 16, 1995, Union Pacific Corporation (the Corporation) executed
a definitive merger agreement pursuant to which it acquired the
remaining 71.6% of the Chicago and North Western Transportation
Company's (CNW) stock. Under this agreement the Corporation initiated a
tender offer on March 23, 1995 and completed the acquisition of the CNW
on April 24, 1995. As a result of the acquisition, and effective April
24, 1995, the Plan is being administered by the Senior Vice President,
Human Resources of the Corporation.
<PAGE> F-10
11. PLAN AMENDMENT
Effective October 24, 1995, the Program was amended such that, the
Program was frozen effective December 31, 1995. There shall be no new
participants in the Program after December 31, 1995. Except for
contributions made in 1996 with respect to 1995 in the customary manner
of the Prior Program as in effect during 1995, there shall be no
contributions made to the Program after December 31, 1995. Effective
January 1, 1995 participants are fully vested in amounts credited to
their account.
12. SUBSEQUENT EVENT
Effective July 15, 1996, the Program was amended and restated. Program
investment options were increased from four to ten. The ten available
options are the Union Pacific Common Stock Fund, the Union Pacific
Equity Index Fund, the Union Pacific Fixed Income Fund, the Vanguard
Bond Market Fund, the Vanguard Money Market Reserves - Prime Portfolio
Fund, the Wellington Fund, the Vanguard World Fund - U.S. Growth
Portfolio, the Vanguard World Fund - International Growth Portfolio, the
Vanguard Windsor Fund and the NWNL Guaranteed Investment Contract Fund.
In conjunction with the amendment and restatement, Program assets were
transferred to Vanguard Fiduciary Trust Company.
<PAGE> F-11
<TABLE>
<CAPTION>
CHICAGO AND NORTH WESTERN RAILWAY COMPANY
PROFIT SHARING AND RETIREMENT SAVINGS PROGRAM
Item 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 1995
- ----------------------------------------------------------------------------------
Column B Column C Column D Column E
Description of Investment,
Identity of Issue, Including Collateral, Rate
Borrower, Lessor or of Interest, Maturity Date Current
Similar Party or Maturity Value Cost Value
<S> <C> <C>
Vanguard Fiduciary Trust Windsor Fund Incorporated,
Company 3,841,686 shares $ 49,810,991 $ 55,819,700
Vanguard Fiduciary Trust Index Trust 500 Portfolio,
Company 376,241 shares 16,572,011 21,795,663
Northwestern National Life
Insurance Company Group annuity contract,
Contract No. GA-13569-1-001 56,645,221 shares 56,645,221 56,645,221
NWNL Companies, Common stock, 9,250
Incorporated shares 142,307 410,469
Vanguard Fiduciary Trust Money Market Reserves
Company Prime Portfolio
205,131 shares 205,131 205,131
LaSalle National Trust* Short-Term Investment
Fund, 2,181,488 shares 2,181,488 2,181,488
------------ ------------
$125,557,149 $137,057,652
============ ============
* Represents a party-in-interest
</TABLE>
<PAGE> F-12
<TABLE>
<CAPTION>
CHICAGO AND NORTH WESTERN RAILWAY COMPANY
PROFIT SHARING AND RETIREMENT SAVINGS PROGRAM
Item 27d - SCHEDULE OF REPORTABLE TRANSACTIONS
YEAR ENDED DECEMBER 31, 1995
- -----------------------------------------------------------------------------------------------------
Single Transactions Involving an Amount in
Excess of 5% of the Current Value of Plan Assets:
Column A Column B Column C Column D Column G Column H Column I
Current
Value of
Asset on
Identity of Description of Purchase Selling Cost of Transaction Net Gain
Party Involved Asset Price Price Asset Date or (Loss)
<S> <C> <C> <C> <C> <C>
Vanguard Fiduciary Windsor Fund
Trust Company Incorporated -- $20,668,157 $20,750,958 $20,668,157 $ (82,801)
Vanguard Fiduciary Index Trust 500
Trust Company Portfolio $20,668,157 -- $20,668,157 $20,668,157 --
</TABLE>
<TABLE>
<CAPTION>
Series of Transactions, When Aggregated, Involving an
Amount in Excess of 5% of the Current Value of Plan Assets
Column A Column B Column C Column D Column E Column F Column G
Identity of Description of Number of Number Dollar Value Dollar Value Net Gain
Party Involved Asset Purchases of Sales of Purchases of Sales or (Loss)
<S> <C> <C> <C> <C> <C>
Vanguard Fiduciary Windsor Fund
Trust Company Incorporated 24 16 $11,029,327 $32,567,906 $1,618,066
Vanguard Fiduciary Index Trust 500
Trust Company Portfolio 25 12 $23,492,646 $ 8,495,338 $1,574,703
Northwestern
National Life
Insurance Company
Contract Group Annuity
No. GA-13569-1-001 Group 22 10 $15,614,603 $10,715,691 $ --
LaSalle National Short-Term Invest-
Trust * ment Fund 120 62 $50,947,240 $48,768,103 $ __
* Represents a party-in-interest
</TABLE>
<PAGE>
Exhibit 23
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration Statement No.
333-10797 of Union Pacific Corporation on Form S-8 of our report dated
August 20, 1996 appearing in this Annual Report on Form 11-K of the Chicago
and North Western Railway Company Profit Sharing and Retirement Savings
Program for the year ended December 31, 1995.
/s/ Deloitte & Touche LLP
DELOITTE & TOUCHE LLP
Omaha, Nebraska
August 26, 1996
