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EXCEL - IDEA: XBRL DOCUMENT - BURLINGTON NORTHERN SANTA FE, LLCFinancial_Report.xls
EX-32.1 - SECTION 906 CEO AND CFO CERTIFICATION - BURLINGTON NORTHERN SANTA FE, LLCcertificationsexhibit321ll.htm
EX-31.2 - SECTION 302 CERTIFICATION - BURLINGTON NORTHERN SANTA FE, LLCcertificationsexhibit312ll.htm
EX-12.1 - COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES - BURLINGTON NORTHERN SANTA FE, LLCratioofearningstofixedchar.htm
EX-31.1 - SECTION 302 CERTIFICATION - BURLINGTON NORTHERN SANTA FE, LLCcertificationsexhibit311ll.htm

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-Q
 
(Mark One)
x
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
  For the quarterly period ended March 31, 2014
OR

o
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            1-11535
BURLINGTON NORTHERN SANTA FE, LLC
(Exact name of registrant as specified in its charter)
Delaware
 
27-1754839
(State or other jurisdiction
of incorporation or organization)
 
(I.R.S. Employer
Identification No.)

2650 Lou Menk Drive
Fort Worth, Texas
(Address of principal executive offices)

76131-2830
(Zip Code)

(800) 795-2673
(Registrant’s telephone number, including area code)
 
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  
 
 
Yes  [x]  No  [  ]
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
 
 
Yes  [x]  No  [  ]
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer”, “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer [  ]  Accelerated filer  [  ]  Non-accelerated filer  [x]  Smaller reporting company  [  ]
 
 
 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
 
 
Yes  [  ]  No  [x]
Registrant meets the conditions set forth in General Instruction H (1) (a) and (b) of Form 10-Q and is therefore filing this Form 10-Q with the reduced disclosure format permitted by General Instruction H (2).



Table of Contents
 
 

2


PART I
FINANCIAL INFORMATION

Item 1.
Financial Statements.

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(In millions)
(Unaudited)
 
 
 
Three Months Ended March 31,
 
 
2014
 
2013
Revenues
 
$
5,447

 
$
5,284

 
 
 
 
 
Operating expenses:
 
 
 
 
Compensation and benefits
 
1,218

 
1,139

Fuel
 
1,159

 
1,122

Purchased services
 
653

 
617

Depreciation and amortization
 
515

 
483

Equipment rents
 
215

 
198

Materials and other
 
319

 
257

Total operating expenses
 
4,079

 
3,816

Operating income
 
1,368

 
1,468

Interest expense
 
196

 
178

Other expense, net
 
3

 
1

 
 
 
 
 
Income before income taxes
 
1,169

 
1,289

Income tax expense
 
445

 
491

Net income
 
$
724

 
$
798


See accompanying Notes to Consolidated Financial Statements.

3


BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In millions)
(Unaudited)

 
 
Three Months Ended March 31,
 
 
2014
 
2013
Net income
 
$
724

 
$
798

 
 
 
 
 
Other comprehensive income:
 
 
 
 
     Change in amortization of accumulated actuarial losses and prior service credits, net of tax benefit of $0 million and $2 million, respectively
 

 
3

     Change in accumulated other comprehensive income of equity method investees
 
3

 
(2
)
Other comprehensive income, net of tax
 
3

 
1

Total comprehensive income
 
$
727

 
$
799


See accompanying Notes to Consolidated Financial Statements.


4


BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In millions)
(Unaudited)
 
 
 
March 31,
2014
 
December 31,
2013
ASSETS
 
 
 
 

Current assets:
 
 
 
 
Cash and cash equivalents
 
$
2,555

 
$
2,225

Accounts receivable, net
 
1,307

 
1,298

Materials and supplies
 
859

 
835

Current portion of deferred income taxes
 
195

 
358

Other current assets
 
168

 
87

Total current assets
 
5,084

 
4,803

 
 
 
 
 
Property and equipment, net of accumulated depreciation of $2,632 and $2,232, respectively
 
52,833

 
52,363

Goodwill
 
14,819

 
14,819

Intangible assets, net
 
744

 
821

Other assets
 
2,289

 
2,224

Total assets
 
$
75,769

 
$
75,030

 
 
 
 
 
LIABILITIES AND EQUITY
 
 
 
 
Current liabilities:
 
 
 
 
Accounts payable and other current liabilities
 
$
3,246

 
$
3,206

Long-term debt due within one year
 
389

 
645

Total current liabilities
 
3,635

 
3,851

 
 
 
 
 
Long-term debt
 
17,560

 
16,361

Deferred income taxes
 
17,120

 
17,224

Intangible liabilities, net
 
917

 
961

Casualty and environmental liabilities
 
673

 
677

Pension and retiree health and welfare liability
 
360

 
362

Other liabilities
 
915

 
982

Total liabilities
 
41,180

 
40,418

Commitments and contingencies (see Notes 5 and 6)
 

 

Equity:
 
 
 
 
Member’s equity
 
34,341

 
34,367

   Accumulated other comprehensive income
 
248

 
245

Total equity
 
34,589

 
34,612

Total liabilities and equity
 
$
75,769

 
$
75,030


See accompanying Notes to Consolidated Financial Statements.

5



BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions)
(Unaudited)
 
 
Three Months Ended March 31,
 
 
2014
 
2013
OPERATING ACTIVITIES
 
 
 
 
Net income
 
$
724

 
$
798

Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
 
Depreciation and amortization
 
515

 
483

Deferred income taxes
 
61

 
145

Long-term casualty and environmental liabilities, net
 
(9
)
 
(17
)
Contribution to defined benefit pension plan
 

 
(25
)
Other, net
 
(217
)
 
(37
)
Changes in current assets and liabilities:
 
 
 
 
Accounts receivable, net
 
(9
)
 
(81
)
Materials and supplies
 
(24
)
 
(38
)
Other current assets
 
(66
)
 
(74
)
Accounts payable and other current liabilities
 
172

 
(242
)
Net cash provided by operating activities
 
1,147

 
912

 
 
 
 
 
INVESTING ACTIVITIES
 
 
 
 
Capital expenditures excluding equipment
 
(645
)
 
(546
)
Acquisition of equipment
 
(273
)
 
(186
)
Other, net
 
(96
)
 
(21
)
Net cash used for investing activities
 
(1,014
)
 
(753
)
 
 
 
 
 
FINANCING ACTIVITIES
 
 
 
 
Proceeds from issuance of long-term debt
 
1,500

 
1,500

Payments on long-term debt
 
(538
)
 
(58
)
Cash distributions
 
(750
)
 
(1,000
)
Other, net
 
(15
)
 
(10
)
Net cash provided by financing activities
 
197

 
432

Increase in cash and cash equivalents
 
330

 
591

Cash and cash equivalents:
 
 
 
 
Beginning of period
 
2,225

 
1,794

End of period
 
$
2,555

 
$
2,385

 
 
 
 
 
SUPPLEMENTAL CASH FLOW INFORMATION
 
 
 
 
Interest paid, net of amounts capitalized
 
$
277

 
$
229

Capital investments accrued but not yet paid
 
$
119

 
$
104

Income taxes paid, net of refunds
 
$
34

 
$
288


See accompanying Notes to Consolidated Financial Statements. 

6


BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
(In millions)
(Unaudited)

 
 
Member’s
Equity

 
Accumulated
Other
Comprehensive
Income

 
Total
Equity

Balance at December 31, 2013
 
$
34,367

 
$
245

 
$
34,612

Cash distributions to Parent
 
(750
)
 

 
(750
)
Comprehensive income, net of tax
 
724

 
3

 
727

Balance at March 31, 2014
 
$
34,341

 
$
248

 
$
34,589


See accompanying Notes to Consolidated Financial Statements.

7


BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
 
1.
Accounting Policies and Interim Results
 
The Consolidated Financial Statements should be read in conjunction with Burlington Northern Santa Fe, LLC’s Annual Report on Form 10-K for the year ended December 31, 2013, including the financial statements and notes thereto. Burlington Northern Santa Fe, LLC (BNSF) is a holding company that conducts no operating activities and owns no significant assets other than through its interests in its subsidiaries. The Consolidated Financial Statements include the accounts of BNSF and its majority-owned subsidiaries, all of which are separate legal entities (collectively, the Company). BNSF’s principal operating subsidiary is BNSF Railway Company (BNSF Railway). All intercompany accounts and transactions have been eliminated.
 
On February 12, 2010, Berkshire Hathaway Inc., a Delaware corporation (Berkshire), acquired 100% of the outstanding shares of Burlington Northern Santa Fe Corporation common stock that it did not already own. The acquisition was completed through the merger (Merger) of a Berkshire wholly-owned merger subsidiary and Burlington Northern Santa Fe Corporation with the surviving entity renamed Burlington Northern Santa Fe, LLC. Earnings per share data has not been presented because BNSF has not issued stock or membership interests to the public.

The results of operations for any interim period are not necessarily indicative of the results of operations to be expected for the entire year. In the opinion of management, the unaudited financial statements reflect all adjustments (consisting of only normal recurring adjustments, except as disclosed) necessary for a fair statement of BNSF’s consolidated financial position as of March 31, 2014, and the results of operations for the three months ended March 31, 2014 and 2013.

Subsequent Event

In April 2014, the Board of Managers (the Board) of the Company authorized an additional $3 billion of debt securities that may be issued pursuant to the debt shelf registration statement filed with the Securities and Exchange Commission (SEC), for a total of $3.25 billion that remains authorized by the Board to be issued through the SEC debt shelf offering process.

2.
Accounts Receivable, Net
 
Accounts receivable, net consists of freight and other receivables, reduced by an allowance for bill adjustments and uncollectible accounts, based upon expected collectibility. At March 31, 2014 and December 31, 2013, $50 million and $54 million, respectively, of such allowances had been recorded.
 
At March 31, 2014 and December 31, 2013, $52 million and $50 million, respectively, of accounts receivable were greater than 90 days old.

3.
Other Intangible Assets and Liabilities
 
Intangible assets and liabilities were as follows (in millions):
 
As of March 31, 2014
 
As of December 31, 2013
 
Gross Carrying
Amount
 
Accumulated
Amortization
 
Gross Carrying
Amount
 
Accumulated
Amortization
Intangible assets
$
2,030

 
$
1,286

 
$
2,030

 
$
1,209

Intangible liabilities
$
2,056

 
$
1,139

 
$
2,056

 
$
1,095

    
Intangible assets primarily consisted of internally developed software and franchise and customer assets. Intangible liabilities primarily consisted of customer and shortline contracts which were in an unfavorable position at the date of Merger.
 
Amortizable intangible assets and liabilities are amortized based on the estimated pattern in which the economic benefits are expected to be consumed or on a straight-line basis over their estimated economic lives.

    

8

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) - (Continued)


Amortization of intangible assets and liabilities was as follows (in millions):
 
Three Months Ended March 31,
 
2014
 
2013
Amortization of intangible assets
$
77

 
$
76

Amortization of intangible liabilities
$
44

 
$
63

 
Amortization of intangible assets and liabilities for the next five years is expected to approximate the following (in millions):
 
Amortization of
intangible assets
 
Amortization of
intangible liabilities
Remainder of 2014
$
233

 
$
135

2015
$
56

 
$
115

2016
$
33

 
$
101

2017
$
33

 
$
96

2018
$
31

 
$
90


4.
Other Assets

In July 2010, the Company entered into a low-income housing partnership (the Partnership) as the limited partner, holding a 99.9% interest in the Partnership. The Partnership is a variable interest entity (VIE), with the purpose of developing and operating low-income housing rental properties. Recovery of the Company’s investment is accomplished through the utilization of low-income housing tax credits and the tax benefits of Partnership losses. The general partner, who holds a 0.1% interest in the Partnership, is an unrelated third party and is responsible for controlling and managing the business and financial operation of the Partnership. As the Company does not have the power to direct the activities that most significantly impact the Partnership’s economic performance, the Company is not the primary beneficiary and therefore, does not consolidate the Partnership. As of March 31, 2014, the assets of the unconsolidated Partnership totaled approximately $400 million. The Company does not provide financial support to the Partnership that it was not previously contractually obligated to provide.    

The Company has accounted for its investment in the Partnership using the effective yield method. The risk of loss of the Company's investment in the Partnership is considered low as an affiliate of the general partner has provided certain guarantees of tax credits and minimum annual returns. The Company’s maximum exposure to loss related to the Partnership is the unamortized investment balance. The following table provides information as of March 31, 2014 (in millions):
Unamortized
investment balance
classified as Other Assets
 
Remaining
commitments classified
as Other Liabilities
 
Maximum
exposure to loss
$
361

 
$
18

 
$
361

 
The remaining commitment of $18 million is expected to be paid in 2014.

5.
Debt
 
Notes and Debentures
 
In March 2014, BNSF issued $500 million of 3.750 percent debentures due April 1, 2024 and $1 billion of 4.900 percent debentures due April 1, 2044. The net proceeds from the sale of the debentures will be used for general corporate purposes, which may include but are not limited to working capital, capital expenditures, repayment of outstanding indebtedness and distributions.

As of March 31, 2014, $250 million remained authorized by the Board to be issued through the SEC debt shelf offering process (see Note 1).


9

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) - (Continued)


The Company is required to maintain certain financial covenants in conjunction with $500 million of certain issued and outstanding junior subordinated notes. As of March 31, 2014, the Company was in compliance with these covenants. In the event of non-compliance, the Company would be required to pay any accrued and unpaid interest.

Fair Value of Debt Instruments
 
At March 31, 2014 and December 31, 2013, the fair value of BNSF's debt, excluding capital leases and unamortized gains on interest rate swaps, was $18,071 million and $16,507 million, respectively, while the book value, which also excludes capital leases and the associated unamortized fair value adjustment under acquisition method accounting related to capital leases and unamortized gains on interest rate swaps, was $17,037 million and $16,066 million, respectively. The fair value of BNSF's debt is primarily based on market value price models using observable market-based data for the same or similar issues, or on the estimated rates that would be offered to BNSF for debt of the same remaining maturities (Level 2 inputs). The fair value of the Company's cash equivalents approximates its carrying value due to the short-term maturities of these instruments.

Guarantees
 
As of March 31, 2014, BNSF has not been called upon to perform under the guarantees specifically disclosed in this footnote and does not anticipate a significant performance risk in the foreseeable future.

Debt and other obligations of non-consolidated entities guaranteed by the Company as of March 31, 2014, were as follows (dollars in millions):
 
Guarantees
 
 
 
 
BNSF
Ownership
Percentage

 
Principal
Amount
Guaranteed

 
Maximum
Future
Payments

 
Maximum
Recourse
Amounta

 
Remaining
Term
(in years)
 
Capitalized Obligations

 
Kinder Morgan Energy Partners, L.P.
0.5
%
 
$
190

 
$
190

 
$

 
Termination of Ownership
 
$
2

b 
Chevron Phillips Chemical Company LP
%
 
N/Ad

 
N/Ad

 
N/Ad

 
3
 
$
6

c 
a 
Reflects the maximum amount the Company could recover from a third party other than the counterparty.
b 
Reflects capitalized obligations that are recorded on the Company’s Consolidated Balance Sheet.
c 
Reflects the asset and corresponding liability for the fair value of these guarantees required by authoritative accounting guidance related to guarantees.
d 
There is no cap to the liability that can be sought from BNSF for BNSF’s negligence or the negligence of the indemnified party. However, BNSF could receive reimbursement from certain insurance policies if the liability exceeds a certain amount.

Kinder Morgan Energy Partners, L.P.
 
Santa Fe Pacific Pipelines, Inc., an indirect, wholly-owned subsidiary of BNSF, has a guarantee in connection with its remaining special limited partnership interest in Santa Fe Pacific Pipeline Partners, L.P. (SFPP), a subsidiary of Kinder Morgan Energy Partners, L.P., to be paid only upon default by the partnership. All obligations with respect to the guarantee will cease upon termination of ownership rights, which would occur upon a put notice issued by BNSF or the exercise of the call rights by the general partners of SFPP.

Chevron Phillips Chemical Company LP
 
In 2007, BNSF entered into an indemnity agreement with Chevron Phillips Chemical Company LP (Chevron Phillips), granting certain rights of indemnity from BNSF, in order to facilitate access to a new storage facility. Under certain circumstances, payment under this obligation may be required in the event Chevron Phillips were to incur certain liabilities or other incremental costs resulting from trackage access.


10

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) - (Continued)


Indemnities
 
In the ordinary course of business, BNSF enters into agreements with third parties that include indemnification clauses. The Company believes that these clauses are generally customary for the types of agreements in which they are included. At times, these clauses may involve indemnification for the acts of the Company, its employees and agents, indemnification for another party’s acts, indemnification for future events, indemnification based upon a certain standard of performance, indemnification for liabilities arising out of the Company’s use of leased equipment or other property, or other types of indemnification. Despite the uncertainty whether events which would trigger the indemnification obligations would ever occur, the Company does not believe that these indemnity agreements will have a material adverse effect on the Company’s results of operations, financial position or liquidity. Additionally, the Company believes that, due to lack of historical payment experience, the fair value of indemnities cannot be estimated with any amount of certainty. However, the fair value of any such amount would be immaterial to the Consolidated Financial Statements. Agreements that reflect unique circumstances, particularly agreements that contain guarantees that indemnify for another party’s acts, are disclosed separately, if appropriate. Unless separately disclosed above, no fair value liability related to indemnities has been recorded in the Consolidated Financial Statements.
 
Variable Interest Entities - Leases
     
BNSF Railway has entered into various equipment lease transactions in which the structure of the lease contains VIEs. These VIEs were created solely for the lease transactions and have no other activities, assets or liabilities outside of the lease transactions. In some of the arrangements, BNSF Railway has the option to purchase some or all of the equipment at a fixed-price, thereby creating variable interests for BNSF Railway in the VIEs. The future minimum lease payments associated with the VIE leases were approximately $3 billion as of March 31, 2014.
 
In the event the leased equipment is destroyed, BNSF Railway is obligated to either replace the equipment or pay a fixed loss amount. The inclusion of the fixed loss amount is a standard clause within equipment lease arrangements. Historically, BNSF Railway has not incurred significant losses related to this clause. As such, it is not anticipated that the maximum exposure to loss would materially differ from the future minimum lease payments.
 
BNSF Railway does not provide financial support to the VIEs that it was not previously contractually obligated to provide.
 
BNSF Railway maintains and operates the equipment based on contractual obligations within the lease arrangements, which set specific guidelines consistent within the industry. As such, BNSF Railway has no control over activities that could materially impact the fair value of the leased equipment. BNSF Railway does not hold the power to direct the activities of the VIEs and therefore does not control the ongoing activities that have a significant impact on the economic performance of the VIEs. Additionally, BNSF Railway does not have the obligation to absorb losses of the VIEs or the right to receive benefits of the VIEs that could potentially be significant to the VIEs. Depending on market conditions, the fixed-price purchase options could potentially provide benefit to the Company; however, any benefits potentially received from a fixed-price purchase option are expected to be minimal. Based on these factors, BNSF Railway is not the primary beneficiary of the VIEs. As BNSF Railway is not the primary beneficiary and the VIE leases are classified as operating leases, there are no assets or liabilities related to the VIEs recorded in the Company's Consolidated Balance Sheet.

6.
Commitments and Contingencies

Personal Injury
 
Personal injury claims, including asbestos claims and employee work-related injuries and third-party injuries (collectively, other personal injury), are a significant expense for the railroad industry. Personal injury claims by BNSF Railway employees are subject to the provisions of the Federal Employers’ Liability Act (FELA) rather than state workers’ compensation laws. FELA’s system of requiring the finding of fault, coupled with unscheduled awards and reliance on the jury system, contributed to increased expenses in past years. Other proceedings include claims by non-employees for punitive as well as compensatory damages. A few proceedings purport to be class actions. The variability present in settling these claims, including non-employee personal injury and matters in which punitive damages are alleged, could result in increased expenses in future years. BNSF has implemented a number of safety programs designed to reduce the number of personal injuries as well as the associated claims and personal injury expense.
    

11

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) - (Continued)


BNSF records an undiscounted liability for personal injury claims when the expected loss is both probable and reasonably estimable. The liability and ultimate expense projections are estimated using standard actuarial methodologies. Liabilities recorded for unasserted personal injury claims are based on information currently available. Due to the inherent uncertainty involved in projecting future events such as the number of claims filed each year, developments in judicial and legislative standards and the average costs to settle projected claims, actual costs may differ from amounts recorded. Expense accruals and any required adjustments are classified as materials and other in the Consolidated Statements of Income.

Asbestos
 
The Company is party to a number of personal injury claims by employees and non-employees who may have been exposed to asbestos. The heaviest exposure for BNSF employees was due to work conducted in and around the use of steam locomotive engines that were phased out between the years of 1950 and 1967. However, other types of exposures, including exposure from locomotive component parts and building materials, continued after 1967 until they were substantially eliminated at BNSF by 1985.
    
BNSF assesses its unasserted asbestos liability exposure on an annual basis during the third quarter. BNSF determines its asbestos liability by estimating its exposed population, the number of claims likely to be filed, the number of claims that will likely require payment and the estimated cost per claim. Estimated filing and dismissal rates and average cost per claim are determined utilizing recent claim data and trends.

Throughout the year, BNSF monitors actual experience against the number of forecasted claims and expected claim payments and will record adjustments to the Company's estimates as necessary.
 
Based on BNSF’s estimate of the potentially exposed employees and related mortality assumptions, it is anticipated that unasserted asbestos claims will continue to be filed through the year 2050. The Company recorded an amount for the full estimated filing period through 2050 because it had a relatively finite exposed population (former and current employees hired prior to 1985), which it was able to identify and reasonably estimate and about which it had obtained reliable demographic data (including age, hire date and occupation) derived from industry or BNSF specific data that was the basis for the study. BNSF projects that approximately 60, 80 and 95 percent of the future unasserted asbestos claims will be filed within the next 10, 15 and 25 years, respectively.

Other Personal Injury
 
BNSF estimates its other personal injury liability claims and expense quarterly based on the covered population, activity levels and trends in frequency and the costs of covered injuries. Estimates include unasserted claims except for certain repetitive stress and other occupational trauma claims that allegedly result from prolonged repeated events or exposure. Such claims are estimated on an as-reported basis because the Company cannot estimate the range of reasonably possible loss due to other non-work related contributing causes of such injuries and the fact that continued exposure is required for the potential injury to manifest itself as a claim. BNSF has not experienced any significant adverse trends related to these types of claims in recent years.
    
BNSF monitors quarterly actual experience against the number of forecasted claims to be received, the forecasted number of claims closing with payment and expected claim payments. Adjustments to the Company’s estimates are recorded quarterly as necessary or more frequently as new events or revised estimates develop.
    
The following table summarizes the activity in the Company’s accrued obligations for asbestos and other personal injury matters (in millions):
 
 
Three Months Ended March 31,
 
 
2014
 
2013
Beginning balance
 
$
387

 
$
462

Accruals
 
18

 
26

Payments
 
(19
)
 
(35
)
     Ending balance
 
$
386

 
$
453



12

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) - (Continued)


At March 31, 2014, $85 million was included in current liabilities. In addition, defense and processing costs, which are recorded on an as-reported basis, were not included in the recorded liability. The Company is primarily self-insured for personal injury claims.

Because of the uncertainty surrounding the ultimate outcome of personal injury claims, it is reasonably possible that future costs to settle personal injury claims may range from approximately $340 million to $455 million. However, BNSF believes that the $386 million recorded at March 31, 2014, is the best estimate of the Company’s future obligation for the settlement of personal injury claims.
    
The amounts recorded by BNSF for personal injury liabilities were based upon currently known facts. Future events, such as the number of new claims to be filed each year, the average cost of disposing of claims, as well as the numerous uncertainties surrounding personal injury litigation in the United States, could cause the actual costs to be higher or lower than projected.
 
Although the final outcome of personal injury matters cannot be predicted with certainty, considering among other things the meritorious legal defenses available and liabilities that have been recorded, it is the opinion of BNSF that none of these items, when finally resolved, will have a material adverse effect on the Company’s financial position or liquidity. However, the occurrence of a number of these items in the same period could have a material adverse effect on the results of operations in a particular quarter or fiscal year.

BNSF Insurance Company
 
The Company has a consolidated, wholly-owned subsidiary, Burlington Northern Santa Fe Insurance Company, Ltd. (BNSF IC) that provides insurance coverage for certain risks, FELA claims, railroad protective and force account insurance claims and certain excess general liability and property coverage, and certain other claims which are subject to reinsurance. BNSF IC has entered into annual reinsurance treaty agreements with several other companies. The treaty agreements insure workers compensation, general liability, auto liability and FELA risk. In accordance with the agreements, BNSF IC cedes a portion of its FELA exposure through the treaty and assumes a proportionate share of the entire risk. Each year BNSF IC reviews the objectives and performance of the treaty to determine its continued participation in the treaty. The treaty agreements provide for certain protections against the risk of treaty participants’ non-performance. On an on-going basis, BNSF and/or the treaty manager reviews the credit-worthiness of each of the participants. BNSF does not believe its exposure to treaty participants’ non-performance is material at this time. BNSF IC typically invests in time deposits and money market accounts. At both March 31, 2014 and December 31, 2013, there was approximately $480 million related to these third-party investments, which were classified as cash and cash equivalents on the Company’s Consolidated Balance Sheet.

Environmental
 
The Company’s operations, as well as those of its competitors, are subject to extensive federal, state and local environmental regulation. BNSF’s operating procedures include practices to protect the environment from the risks inherent in railroad operations, which frequently involve transporting chemicals and other hazardous materials. Additionally, many of BNSF’s land holdings are and have been used for industrial or transportation-related purposes or leased to commercial or industrial companies whose activities may have resulted in discharges onto the property. As a result, BNSF is subject to environmental cleanup and enforcement actions. In particular, the federal Comprehensive Environmental Response, Compensation and Liability Act of 1980 (CERCLA), also known as the Superfund law, as well as similar state laws, generally impose joint and several liability for cleanup and enforcement costs on current and former owners and operators of a site without regard to fault or the legality of the original conduct. BNSF has been notified that it is a potentially responsible party (PRP) for study and cleanup costs at Superfund sites for which investigation and remediation payments are or will be made or are yet to be determined (the Superfund sites) and, in many instances, is one of several PRPs. In addition, BNSF may be considered a PRP under certain other laws. Accordingly, under CERCLA and other federal and state statutes, BNSF may be held jointly and severally liable for all environmental costs associated with a particular site. If there are other PRPs, BNSF generally participates in the cleanup of these sites through cost-sharing agreements with terms that vary from site to site. Costs are typically allocated based on such factors as relative volumetric contribution of material, the amount of time the site was owned or operated and/or the portion of the total site owned or operated by each PRP.
 
BNSF is involved in a number of administrative and judicial proceedings and other mandatory cleanup efforts for 241 sites, including 16 Superfund sites, at which it is participating in the study or cleanup, or both, of alleged environmental contamination.

13

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) - (Continued)


Liabilities for environmental cleanup costs are recorded when BNSF’s liability for environmental cleanup is probable and reasonably estimable. Subsequent adjustments to initial estimates are recorded as necessary based upon additional information developed in subsequent periods. Environmental costs include initial site surveys and environmental studies as well as costs for remediation of sites determined to be contaminated.

BNSF estimates the ultimate cost of cleanup efforts at its known environmental sites on an annual basis during the third quarter. Ultimate cost estimates for environmental sites are based on current estimated percentage to closure ratios, possible remediation workplans and estimates of the costs and likelihood of each possible outcome, historical payment patterns, and benchmark patterns developed from data accumulated from industry and public sources, including the Environmental Protection Agency and other governmental agencies. These factors incorporate into the estimates experience gained from cleanup efforts at other similar sites.
 
Annual studies do not include: (i) contaminated sites of which the Company is not aware; (ii) additional amounts for third-party tort claims, which arise out of contaminants allegedly migrating from BNSF property, due to a limited number of sites; or (iii) natural resource damage claims. BNSF continues to estimate third-party tort claims on a site by site basis when the liability for such claims is probable and reasonably estimable. BNSF’s recorded liability for third-party tort claims as of both March 31, 2014 and December 31, 2013 was $13 million.
 
On a quarterly basis, BNSF monitors actual experience against the forecasted remediation and related payments made on existing sites and conducts ongoing environmental contingency analyses, which consider a combination of factors including independent consulting reports, site visits, legal reviews and analysis of the likelihood of other PRP's participation in, and their ability to pay for, cleanup. Adjustments to the Company’s estimates will continue to be recorded as necessary based on developments in subsequent periods. Additionally, environmental accruals, which are classified as materials and other in the Consolidated Statements of Income, include amounts for newly identified sites or contaminants, third-party claims and legal fees incurred for defense of third-party claims and recovery efforts.

The following table summarizes the activity in the Company’s accrued obligations for environmental matters (in millions):
 
 
Three Months Ended March 31,
 
 
2014
 
2013
Beginning balance
 
$
435

 
$
458

Accruals
 
2

 

Payments
 
(10
)
 
(8
)
     Ending balance
 
$
427

 
$
450

 
At March 31, 2014, $55 million was included in current liabilities.
    
BNSF’s environmental liabilities are not discounted. BNSF anticipates that the majority of the accrued costs at March 31, 2014, will be paid over the next ten years, and no individual site is considered to be material.
 
Liabilities recorded for environmental costs represent BNSF’s best estimate of its probable future obligation for the remediation and settlement of these sites and include both asserted and unasserted claims. Although recorded liabilities include BNSF’s best estimate of all probable costs, without reduction for anticipated recoveries from third parties, BNSF’s total cleanup costs at these sites cannot be predicted with certainty due to various factors such as the extent of corrective actions that may be required, evolving environmental laws and regulations, advances in environmental technology, the extent of other parties’ participation in cleanup efforts, developments in ongoing environmental analyses related to sites determined to be contaminated and developments in environmental surveys and studies of contaminated sites.

Because of the uncertainty surrounding these factors, it is reasonably possible that future costs for environmental liabilities may range from approximately $320 million to $590 million. However, BNSF believes that the $427 million recorded at March 31, 2014, is the best estimate of the Company’s future obligation for environmental costs.
    
    

14

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) - (Continued)


Although the final outcome of these environmental matters cannot be predicted with certainty, it is the opinion of BNSF that none of these items, when finally resolved, will have a material adverse effect on the Company’s financial position or liquidity. However, the occurrence of a number of these items in the same period could have a material adverse effect on the results of operations in a particular quarter or fiscal year.

Other Claims and Litigation
 
In addition to asbestos, other personal injury and environmental matters discussed above, BNSF and its subsidiaries are also parties to a number of other legal actions and claims, governmental proceedings and private civil suits arising in the ordinary course of business, including those related to disputes and complaints involving certain transportation rates and charges. Some of the legal proceedings include claims for punitive as well as compensatory damages, and a few proceedings purport to be class actions. Although the final outcome of these matters cannot be predicted with certainty, considering among other things the meritorious legal defenses available and liabilities that have been recorded along with applicable insurance, BNSF currently believes that none of these items, when finally resolved, will have a material adverse effect on the Company’s financial position or liquidity. However, an unexpected adverse resolution of one or more of these items could have a material adverse effect on the results of operations in a particular quarter or fiscal year.

7.
Employment Benefit Plans

Components of the net cost for the periods presented below for certain employee benefit plans were as follows (in millions):
 
 
Pension Benefits
 
 
Three Months Ended March 31,
Net Cost
 
2014
 
2013
Service cost
 
$
10

 
$
12

Interest cost
 
24

 
22

Expected return on plan assets
 
(34
)
 
(31
)
Amortization of net loss
 

 
4

Net cost recognized
 
$

 
$
7


 
 
Retiree Health and Welfare Benefits
 
 
Three Months Ended March 31,
Net Cost
 
2014
 
2013
Interest cost
 
$
3

 
$
3

Amortization of prior service credits
 
(1
)
 

Amortization of net loss
 
1

 
1

Net cost recognized
 
$
3

 
$
4


8.
Related Party Transactions

The companies identified as affiliates of BNSF include Berkshire and its subsidiaries. During the three months ended March 31, 2014 and 2013, the Company declared and paid cash distributions of $750 million and $1 billion, respectively, to its parent company. For the three months ended March 31, 2014 and 2013, the Company made tax payments of $0 million and $264 million to Berkshire, respectively.

    

15

BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) - (Continued)


BNSF engages in various arm's-length transactions with affiliates in the ordinary course of business. The following table summarizes revenues earned by BNSF for services provided to affiliates and expenditures to affiliates (in millions):
 
 
Three Months Ended March 31,
 
 
2014
 
2013
Revenues
 
$
40

 
$
38

Expenditures
 
$
6

 
$
6


9.
Comprehensive Income
 
Other comprehensive income refers to revenues, expenses, gains and losses that under generally accepted accounting principles are included in comprehensive income, a component of equity within the Consolidated Balance Sheets, rather than net income on the Consolidated Statements of Income. Under existing accounting standards, other comprehensive income may include, among other things, unrecognized gains and losses and prior service credit related to pension and other postretirement benefit plans and accounting for derivative financial instruments, which qualify for cash flow hedge accounting.
    
The following table provides the components of accumulated other comprehensive income by component (in millions):
 
 
Pension and Retiree Health and Welfare Benefit Itemsa
 
Equity Method Investments
 
Total
Balance at December 31, 2013
 
$
251

 
$
(6
)
 
$
245

Other comprehensive income before reclassifications
 

 
3

 
3

Amounts reclassified from accumulated other comprehensive income
 

 

 

Balance at March 31, 2014
 
$
251

 
$
(3
)
 
$
248

a Amounts are net of tax.
Reclassifications out of Accumulated Other Comprehensive Income
 
 
 
 
 
 
 
 
 
Three Months Ended March 31,
 
 
Details about Accumulated Other Comprehensive Income Components
 
2014
 
2013
 
Income Statement Line Item
Amortization of pension and retiree health and welfare benefit items
 
 
 
 
 
 
     Actuarial losses
 
$
1

 
$
5

 
b 
Prior service credits
 
(1
)
 

 
b 
 
 

 
5

 
Total before tax
 
 

 
(2
)
 
Tax expense/(benefit)
Total reclassifications for the period
 
$

 
$
3

 
Net of tax
b This accumulated other comprehensive income component is included in the computation of net periodic pension cost and retiree health and welfare (see Note 7 for additional details).

10.
Accounting Pronouncements
 
In January 2014, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update No. 2014-01 (ASU 2014-01), Investments - Equity Method and Joint Ventures (Topic 323), Accounting for Investments in Qualified Affordable Housing Projects. This standard permits an entity to elect the proportional amortization method of accounting for limited liability investments in qualified affordable housing projects if certain criteria are met. Under the proportional amortization method, the investment is amortized in proportion to the tax benefits received and the net investment performance is reported as a component of income tax expense. ASU 2014-01 is effective for fiscal years beginning after December 15, 2014, with early adoption permitted. If elected, the proportional amortization method is required to be applied retrospectively. The Company is currently evaluating the effect this standard will have on its Consolidated Financial Statements.

16


Item 2.
Management’s Narrative Analysis of Results of Operations.
 
Management’s narrative analysis relates to the results of operations of Burlington Northern Santa Fe, LLC and its majority-owned subsidiaries (collectively BNSF, Registrant or Company). The principal operating subsidiary of BNSF is BNSF Railway Company (BNSF Railway) through which BNSF derives substantially all of its revenues. The following narrative analysis should be read in conjunction with the Consolidated Financial Statements and the accompanying notes.
 
The following narrative analysis of results of operations includes a comparative analysis of the three months ended March 31, 2014 and 2013.

Results of Operations

Revenues Summary
 
The following tables present BNSF’s revenue information by business group:
 
 
Revenues (in millions)
 
Cars / Units (in thousands)
 
 
Three Months Ended March 31,
 
Three Months Ended March 31,
 
 
2014
 
2013
 
2014
 
2013
Consumer Products
 
$
1,663

 
$
1,661

 
1,194

 
1,188

Industrial Products
 
1,407

 
1,337

 
452

 
448

Coal
 
1,224

 
1,209

 
563

 
542

Agricultural Products
 
976

 
911

 
236

 
244

Total Freight Revenues
 
5,270

 
5,118

 
2,445

 
2,422

Other Revenues
 
177

 
166

 
 
 
 
Total Operating Revenues
 
$
5,447

 
$
5,284

 
 
 
 

 
 
Average Revenue Per Car / Unit
 
 
Three Months Ended March 31,
 
 
2014
 
2013
Consumer Products
 
$
1,393

 
$
1,398

Industrial Products
 
3,113

 
2,984

Coal
 
2,174

 
2,231

Agricultural Products
 
4,136

 
3,734

Total Freight Revenues
 
$
2,155

 
$
2,113


Fuel Surcharges
 
Freight revenues include both revenue for transportation services and fuel surcharges. BNSF’s fuel surcharge program is intended to recover its incremental fuel costs when fuel prices exceed a threshold fuel price. Fuel surcharges are calculated differently depending on the type of commodity transported. BNSF has two standard fuel surcharge programs – Percent of Revenue and Mileage-Based. In addition, in certain commodities, fuel surcharge is calculated using a fuel price from a time period that can be up to 60 days earlier. In a period of volatile fuel prices or changing customer business mix, changes in fuel expense and fuel surcharge may significantly differ.

The following table presents fuel surcharge and fuel expense information (in millions):
 
 
Three Months Ended March 31,
 
 
2014
 
2013
Total fuel expense a
 
$
1,159

 
$
1,122

BNSF fuel surcharges
 
$
703

 
$
711

a  Total fuel expense includes locomotive and non-locomotive fuel.

17


Three Months Ended March 31, 2014 vs. the Three Months Ended March 31, 2013

Revenues
 
Revenues for the three months ended March 31, 2014, were $5,447 million, an increase of $163 million, or 3 percent as compared with the three months ended March 31, 2013. The increase in revenues is due to the following changes in underlying trends in revenues:

Average revenue per car / unit increased primarily as a result of increased rate per car / unit.

In addition to an increase in average revenue per car / unit, the following changes in underlying trends in volumes also impacted the change in revenues:

Consumer Products unit volumes increased due to higher international and domestic intermodal traffic, offset by reductions in automotive.

Industrial Products unit volumes increased primarily due to higher shipments of petroleum products, driven mainly by increased crude unit train loadings.

Coal unit volumes increased primarily due to higher demand.

Agricultural Products unit volumes decreased primarily due to severe weather issues and service-related challenges.

Expenses
 
Operating expenses for the three months ended March 31, 2014, were $4,079 million, an increase of $263 million, or 7 percent, as compared with the three months ended March 31, 2013. A significant portion of this increase is due to the following changes in underlying trends in expenses, which includes increased costs related to severe weather issues and service-related challenges:
 
Compensation and benefits expense increased primarily due to wage inflation, higher overtime and higher average headcount.

Fuel expense increased due to higher volumes and lower fuel efficiency, partially offset by lower average fuel prices.

Purchased services expense increased as a result of increased ramping and drayage costs, professional services and purchased transportation for BNSF Logistics, LLC, a wholly-owned, third-party logistics company.

Depreciation and amortization expense increased due to additional assets in service.

Materials and other expense increased as a result of higher crew transportation, lodging and other travel costs, utilities and locomotive materials.

There were no significant changes in the underlying trends for equipment rents expense and the effective tax rate.

Interest expense increased primarily due to a higher average debt balance.








18


Forward-Looking Information
 
To the extent that statements made by the Company relate to the Company’s future economic performance or business outlook, projections or expectations of financial or operational results, or refer to matters that are not historical facts, such statements are “forward-looking” statements within the meaning of the federal securities laws.
 
Forward-looking statements involve a number of risks and uncertainties, and actual performance or results may differ materially. For a discussion of material risks and uncertainties that the Company faces, see the discussion in Item 1A, “Risk Factors,” of the Company’s Annual Report on Form 10-K. Important factors that could cause actual results to differ materially include, but are not limited to, the following:

•  Economic and industry conditions: material adverse changes in economic or industry conditions, both in the United States and globally; volatility in the capital or credit markets including changes affecting the timely availability and cost of capital; changes in customer demand, effects of adverse economic conditions affecting shippers or BNSF’s supplier base, and effects due to more stringent regulatory policies such as the regulation of carbon dioxide emissions that could reduce the demand for coal or governmental tariffs or subsidies that could affect the demand for grain, the impact of low natural gas prices on coal demand for electric power plants, changes in environmental laws and other laws and regulations that could affect the demand for drilling products and products produced by drilling, changes in fuel prices and other key materials, the impact of high barriers of entry for prospective new suppliers and disruptions in supply chains for these materials; competition and consolidation within the transportation industry; and changes in crew availability, labor and benefits costs and labor difficulties, including stoppages affecting either BNSF’s operations or customers’ abilities to deliver goods to BNSF for shipment.
 
•   Legal, legislative and regulatory factors: developments and changes in laws and regulations, including those affecting train operations or the marketing of services; the ultimate outcome of shipper and rate claims subject to adjudication; claims, investigations or litigation alleging violations of the antitrust laws; increased economic regulation of the rail industry through legislative action and revised rules and standards applied by the U.S. Surface Transportation Board in various areas including rates and services; developments in environmental investigations or proceedings with respect to rail operations or current or past ownership or control of real property or properties owned by others impacted by BNSF operations; losses resulting from claims and litigation relating to personal injuries, asbestos and other occupational diseases; the release of hazardous materials, environmental contamination and damage to property; regulation, restrictions or caps, or other controls of diesel emissions that could affect operations or increase costs; the availability of adequate insurance to cover the risks associated with operations.
 
•   Operating factors: changes in operating conditions and costs; operational and other difficulties in implementing positive train control technology, including increased compliance or operational costs or penalties; restrictions on development and expansion plans due to environmental concerns; disruptions to BNSF's technology network including computer systems and software, such as cybersecurity intrusions, misappropriation of assets or sensitive information, corruption of data or operations disruptions; as well as natural events such as severe weather, fires, floods and earthquakes or man-made or other disruptions of BNSF Railway’s or other railroads’ operating systems, structures, or equipment including the effects of acts of terrorism on the Company’s system or other railroads’ systems or other links in the transportation chain.
 
The Company cautions against placing undue reliance on forward-looking statements, which reflect its current beliefs and are based on information currently available to it as of the date a forward-looking statement is made. The Company undertakes no obligation to revise forward-looking statements to reflect future events, changes in circumstances, or changes in beliefs. In the event the Company does update any forward-looking statement, no inference should be made that the Company will make additional updates with respect to that statement, related matters, or any other forward-looking statements.


19


Item 4.
Controls and Procedures.
 
Based on their evaluation as of the end of the period covered by this quarterly report on Form 10-Q, BNSF’s principal executive officer and principal financial officer have concluded that BNSF’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934) are effective to ensure that information required to be disclosed by BNSF in the reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized, and reported within the time periods specified in Securities and Exchange Commission rules and forms and that such information is accumulated and communicated to BNSF’s management, including its principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure. Additionally, as of the end of the period covered by this report, BNSF's principal executive officer and principal financial officer have concluded that there have been no changes in BNSF's internal control over financial reporting that occurred during BNSF’s first fiscal quarter that have materially affected, or are reasonably likely to materially affect, BNSF's internal control over financial reporting.


20


BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

PART II OTHER INFORMATION

Item 6.
Exhibits.
 
See Index to Exhibits on page E-1 for a description of the exhibits filed as part of this report.


21


SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 
BURLINGTON NORTHERN SANTA FE, LLC
(Registrant)
 
 
 
 
By:
/s/    Julie A. Piggott       
 
 
Julie A. Piggott
Executive Vice President and Chief Financial Officer
(On behalf of the Registrant and
as principal financial officer)

Date:  May 2, 2014


S-1


BURLINGTON NORTHERN SANTA FE, LLC and SUBSIDIARIES

Exhibit Index

 
 
Incorporated by Reference
(if applicable)
 
Exhibit Number and Description
Form
File Date
File No.
Exhibit
 
 
 
 
 
 
3.1
Certificate of Formation dated November 2, 2009.
8-K
2/16/2010
001-11535
3.1
 
 
 
 
 
 
3.2
Amended and Restated Limited Liability Company Operating Agreement of Burlington Northern Santa Fe, LLC, dated as of February 12, 2010.
8-K
2/16/2010
001-11535
3.2
 
 
 
 
 
 
3.3
Written Consent of sole member of Burlington Northern Santa Fe, LLC, dated April 8, 2010, amending and restating certain sections of the Amended and Restated Limited Liability Company Operating Agreement of Burlington Northern Santa Fe, LLC dated as of February 12, 2010.
8-K
4/14/2010
001-11535
3.2
 
 
 
 
 
 
4.1
Fourteenth Supplemental Indenture, dated as of March 7, 2014, to Indenture dated as of December 1, 1995, between Burlington Northern Santa Fe, LLC and The Bank of New York Mellon Trust Company, N.A., as Trustee.
8-K
3/7/2014
001-11535
4.1
 
 
 
 
 
 
4.2
Certificate of Determination as to the terms of BNSF’s 3.750% Debentures due April 1, 2024 and 4.900% Debentures due April 1, 2044.
8-K
3/7/2014
001-11535
4.2
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
101
eXtensible Business Reporting Language (XBRL) documents submitted electronically:

101.INS - XBRL Instance Document
101.SCH - XBRL Taxonomy Extension Schema Document
101.CAL - XBRL Extension Calculation Linkable Document
101.DEF - XBRL Taxonomy Extension Definition Linkable Document
101.LAB - XBRL Taxonomy Extension Label Linkbase
101.PRE - XBRL Taxonomy Extension Presentation Linkbase Document
 
 
 
 
 
The following unaudited information from the Burlington Northern Santa Fe, LLC Form 10-Q for the three months ended March 31, 2014, formatted in XBRL includes: (i) the Consolidated Statements of Income for the three months ended March 31, 2014 and 2013, (ii) the Consolidated Statements of Comprehensive Income for the three months ended March 31, 2014 and 2013, (iii) the Consolidated Balance Sheets as of March 31, 2014 and December 31, 2013, (iv) the Consolidated Statements of Cash Flows for the three months ended March 31, 2014 and 2013, (v) the Consolidated Statements of Changes in Equity as of March 31, 2014, and (vi) the Notes to the Consolidated Financial Statements. *
 
 
 
 
Certain instruments defining the rights of the holders of long-term debt of the Company and of its subsidiaries, involving a total
amount of indebtedness not in excess of 10 percent of the total assets of the Company and its subsidiaries on a consolidated basis,
have not been filed as exhibits. The Company hereby agrees to furnish a copy of any of these agreements to the SEC upon request.
__________________
* Filed herewith

E-1