Exhibit 10
UNION PACIFIC CORPORATION AND SUBSIDIARY COMPANIES
EXECUTIVE LIFE INSURANCE PLAN OF UNION PACIFIC CORPORATION
In recognition of the services provided to Union Pacific Corporation (the
"Company") and participating Affiliated Companies by certain key employees,
the Board of Directors of the Company has deemed it appropriate to make life
insurance coverage available to these key employees under the terms and
conditions hereinafter set forth:
SECTION 1
Definitions
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As used herein, the following words and phrases shall have the meaning
described below:
1.1 "Actively-At-Work" means the Eligible Employee is performing all normal
duties of the position held by the Eligible Employee on a full-time basis for
not less than 35 hours per week and is not absent from work due to accident,
illness or other condition for more than any three (3) days of the 90 days
prior to the date of reference.
1.2 "Affiliated Company" means any entity that is required to be aggregated
with the Company pursuant to section 414(b), 414(c), 414(m) or 414(o) of the
Code.
1.3 "Age" means the Eligible Employee's age on his or her birthday that is
nearest to the date of reference.
1.4 "Base Salary" means, with respect to any Plan Year, an Eligible
Employee's base annual salary from the Employer, exclusive of (a) bonuses or
any other form of extra remuneration and (b) severance pay, but including any
deferral from base annual salary made pursuant to the provisions of section
125 or 401(k) of the Code, determined as of the August 16 immediately
preceding the first day of the Plan Year.
1.5 "Beneficiary" means the person or persons designated in accordance with
the terms of the applicable Contract to receive any death benefit payable
under the Contract.
1.6 "Board" means the Board of Directors of the Company.
1.7 "Claims Reviewer" means the designated claims reviewer under any contract
which provides for the processing of claims under the Plan or, otherwise, the
Named Fiduciary-Plan Administration.
1.8 "Code" means the Internal Revenue Code of 1986, as the same may be
amended from time to time, and any successor statute of similar purpose.
1.9 "Company" means the Union Pacific Corporation and any successor thereto
that adopts this Plan.
1.10 "Contract" means an agreement with the Insurer relating to the provision
of universal life insurance coverage for an Eligible Employee, with an initial
targeted death benefit payable to the Beneficiary of two times the Eligible
Employee's Base Salary as of initial enrollment, if death occurs while he or
she is an Eligible Employee, and 1/2 final Base Salary, if death occurs after
retirement on or after the Eligible Employee's 62nd birthday. The targeted
death benefit under any Contract issued for an Eligible Employee shall be
increased as of the first day of each Plan Year while he or she remains an
Eligible Employee to reflect the Eligible Employee's Base Salary as determined
for the Plan Year pursuant to Section 1.4, subject to the Insurer's then
applicable underwriting standards and other applicable terms of the Contract.
The actual amount of any death benefit payable to a Beneficiary shall be
determined by the terms of the Contract.
1.11 "Effective Date" means January 1, 1993.
1.12 "Eligible Employee" means an Employee who has attained salary grade 25
or above as of such date as the Named Fiduciary-Plan Administration
establishes for a given Plan Year. An Eligible Employee shall cease to be
such upon his or her death, retirement, discharge, resignation or other
termination of employment with the Employer or as of such date as may be
prescribed by the Named Fiduciary-Plan Administration in the event of his or
her transfer to a position with the Employer not described in the preceding
sentence.
1.13 "Employee" means any individual employed by the Employer, but excluding
any non-resident alien and any leased employee within the meaning of Code
Section 414(n)(2).
1.14 "Employer" means, either collectively or individually as the context
requires, the Company or any Affiliated Company that adopts this Plan for the
benefit of its Eligible Employees with the approval of the Senior Vice
President-Human Resources of the Company.
1.15 "Insurer" means Connecticut General Life Insurance Company or any
successor thereto.
1.16 "Named Fiduciary-Plan Administration" means the Senior Vice President-
Human Resources of the Company or, in the event there is no such person, the
person or persons named as such by the Company or, in the absence of any such
appointment, the Company.
1.17 "Participant" means any individual who has satisfied the eligibility
requirements for participation set forth in Section 2.1 and who is an Eligible
Employee with an election to purchase a Contract in effect under Section 2.2
or 2.4 on the date of reference.
1.18 "Plan" means the Union Pacific Corporation Executive Life Insurance
Program as set forth herein.
1.19 "Plan Year" means a twelve consecutive month period that begins on any
January 1 on or after the Effective Date and ends on the next following
December 31.
SECTION 2
Participation
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2.1 Eligibility to Participate.
(a) Each Employee who is an Eligible Employee under Age 62 as of August 1,
1993 may elect to become a Participant in the Plan as of the Effective Date
(the Eligible Employee's "Initial Eligibility Date"), or as of the first day
of any Plan Year thereafter with respect to which he or she is an Eligible
Employee, pursuant to Section 2.2.
(b) Each Employee not described in subsection (a) who becomes an Eligible
Employee may elect to become a Participant in the Plan as of the January 1
next following the date he or she becomes an Eligible Employee (the Eligible
Employee's "Initial Eligibility Date"), or as of the first day of any Plan
Year thereafter with respect to which he or she is an Eligible Employee,
pursuant to Section 2.2.
2.2 Election to Participate. An Eligible Employee described in Section 2.1
shall become a Participant by electing, in the form and manner and at such
time in advance as may be prescribed by the Named Fiduciary-Plan
Administration, to purchase a Contract, effective as of the Initial
Eligibility Date or as of the first day of any Plan Year thereafter with
respect to which he is an Eligible Employee, and by authorizing the Employer
to make any necessary payment of premiums for such Contract by payroll
deduction pursuant to Section 3.1 or making such other arrangement for payment
of premiums as may be acceptable to the Insurer and the Named Fiduciary-Plan
Administration. Notwithstanding anything in this Article 2 to the contrary,
elections under this Section 2.2 by Eligible Employees shall be subject to the
Insurer's then applicable underwriting standards and other applicable
standards or terms of the Contract.
2.3 Cessation of Participation.
(a) Date of Cessation of Participation. An Eligible Employee who has become
a Participant shall cease to be a Participant on the earliest of:
(1) The date the Plan is terminated pursuant to Section 5.2;
(2) The date he or she ceases to be an Eligible Employee under Section 1.12;
(3) The date as of which required premiums for the Contract described in
Section 3.1 cease to be paid; or
(4) The date any Contract issued for the Participant is surrendered.
(b) Effect of Cessation of Participation. When an individual ceases to be a
Participant, his or her right to purchase a Contract through the Plan shall
cease, whether or not such individual continues to be an Employee or an
Eligible Employee. Upon cessation of participation, such individual may
surrender any Contract purchased as a Participant or continue any such
Contract in accordance with arrangements made directly with the Insurer.
2.4 Recommencement of Participation. In the event a former Participant's
participation ceased due to an event described in Section 2.3(a)(2) and such
former Participant again becomes an Eligible Employee, he or she shall
recommence participation in the Plan as if he or she were a new Employee on
the date he or she again became an Eligible Employee, subject to the Insurer's
then applicable underwriting standards and other applicable standards or terms
of the Contract. In the event a former Participant's participation ceased due
to an event described in Section 2.3(a)(3), he or she may elect, in accordance
with procedures prescribed by the Named Fiduciary-Plan Administration, to
recommence participation in the Plan as of the first day of any subsequent
Plan Year on which he or she is an Eligible Employee, subject to the Insurer's
then applicable underwriting standards and other applicable standards or terms
of the Contract. In the event a former Participant's participation ceased due
to an event described in Section 2.3(a)(4), he or she may not recommence
participation in the Plan.
SECTION 3
Premiums and Benefit Payment
3.1 Payment of Premiums. Each Participant shall own any Contract issued
pursuant to his or her election under Section 2.2 or 2.4 and shall be
responsible for payment of premiums for such Contract as determined by the
Insurer from time to time. At the written authorization of the Participant,
the Employer shall deduct the required premiums from compensation paid to the
Participant by the Employer and remit such amounts to the Insurer as soon as
administratively practicable, but no later than 90 days, following such
deduction. The Employer shall have no duty to make any contributions to the
Plan.
3.2 Source of Benefit Payments. All benefits provided for by any Contract
issued pursuant to a Participant's election under Section 2.2 or 2.4 shall be
paid exclusively by the Insurer.
SECTION 4
Administration
4.1 Duties and Powers of Named Fiduciary-Plan Administration. The Named
Fiduciary-Plan Administration shall have full discretionary power and
authority to construe, interpret and administer this Plan and may, to the
extent permitted by law, make factual determinations, correct defects, supply
omissions and reconcile inconsistencies to the extent necessary to effectuate
the Plan and, subject to Section 4.2, the Named Fiduciary-Plan
Administration's actions in doing so shall be final and binding on all persons
interested in the Plan. The Named Fiduciary-Plan Administration may from time
to time adopt rules and regulations governing the operation of this Plan and
may employ and rely on such legal counsel, such actuaries, such accountants
and such agents as it may deem advisable to assist in the administration of
the Plan.
4.2 Claims Procedure. The Claims Reviewer shall review claims under the Plan
and respond thereto within a reasonable time after receiving the claim.
Claims shall generally be processed as described in the applicable Contract;
provided, however, that the claims procedure described in this Section 4.2
shall apply in the event the applicable Contract does not contain a claims
procedure that complies with 29 CFR Sec. 2560.503-1. The Claims Reviewer shall
provide to every claimant whose claim is denied a written notice setting
forth, in a manner calculated to be understood by the claimant:
(a) the specific reason or reasons for the denial;
(b) specific references to pertinent Plan provisions on which denial is
based;
(c) a description of any additional material or information necessary for the
claimant to perfect the claim; and
(d) an explanation of the claim review procedure set forth below.
Within 60 days of receipt by a claimant of a notice denying a claim, the
claimant or his duly authorized representative may request in writing a full
and fair review of the claim by the Claims Reviewer. The Claims Reviewer may
extend the 60-day period where the nature of the benefit involved or other
attendant circumstances made such extension appropriate. In connection with
such review, the claimant or his duly authorized representative may review
pertinent documents and may submit issues and comments in writing. The Claims
Reviewer shall make a decision promptly, and not later than 60 days after the
Claims Reviewer's receipt of a request for review, unless special
circumstances (such as the need to hold a hearing, if the Claims Reviewer
deems one necessary) require an extension of time for processing, in which
case a decision shall be rendered as soon as possible, but not later than 120
days after receipt of a request for review. The decision on review shall be
in writing and shall include specific reasons for the decision, written in a
manner calculated to be understood by the claimant, and specific references to
the pertinent Plan provisions on which the decision is based.
SECTION 5
Amendment and Termination
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5.1 Authority to Amend. The Company, acting through its Senior Vice
President-Human Resources, may amend the Plan at any time in any manner
whatsoever.
5.2 Right to Terminate. Continuance of the Plan is completely voluntary and
is not assumed as a contractual obligation of the Employer. The Company shall
have the right at any time for any reason to terminate the Plan by action of
the Board. Furthermore, each Employer may discontinue its participation in
the Plan at any time with the approval of the Senior Vice President-Human
Resources of the Company.
SECTION 6
Miscellaneous
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6.1 Effect on Employment. Nothing contained herein shall be construed as
conferring upon an Employee the right to continue in the employ of the
Employer as an executive or in any other capacity.
6.2 Rights and Obligations. The rights and obligations created hereunder
shall be binding on a Participant's heirs, executors and administrators and on
the successors and assigns of the Employers.
6.3 Non-alienation. The rights of any Participant under this Plan are
personal and may not be assigned, transferred, pledged or encumbered;
provided, however, that nothing herein shall prevent or shall be construed to
prevent a transfer of rights under any Contract issued to the Participant, in
accordance with the terms of the Contract.
6.4 Limitation on Obligations. Neither the Company nor any other Employer
nor any member of the Board shall be responsible or liable in any manner to
any Participant any person claiming through him or her for any benefit or
action taken or omitted in connection with the granting of benefits, the
continuation of benefits, or the interpretation and administration of the
Plan.
6.5 Governing Law. The Plan shall be construed in accordance with and
governed by the laws of the Commonwealth of Pennsylvania, except to the extent
preempted by the Employee Retirement Income Security Act of 1974, as amended
from time to time.