1.0.0.3 false Debt (Unaudited) false 1 $ false false USD Standard http://www.xbrl.org/2003/iso4217 USD iso4217 0 USDEPS Divide http://www.xbrl.org/2003/iso4217 USD iso4217 http://www.xbrl.org/2003/instance shares xbrli 0 2 Debt [Abstract] 0 bni_DebtAbstract bni false na duration string Debt. false false false false false true false false false 1 false false 0 0 false false Debt. false 3 Debt 1 us-gaap_DebtDisclosureTextBlock us-gaap true na duration string No definition available. false false false false false false false false false 1 false false 0 0  <html> <head></head> <body>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="left" style="font-size: 10pt; margin-top: 12pt"><b>4. Debt</b> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"><u><b>Revolving Credit Facility and Commercial Paper</b></u> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">     As of June 30, 2009, the Company had borrowing capacity of up to $1.2 billion under its long-term revolving bank credit facility, which expires in September 2012. Annual facility fees are currently 0.08 percent for the facility. The rate is subject to change based upon changes in BNSF’s senior unsecured debt ratings. Borrowing rates are based upon (i) LIBOR plus a spread determined by BNSF’s senior unsecured debt ratings; (ii) money market rates offered at the option of the lenders; or (iii) an alternate base rate. BNSF must maintain compliance with certain financial covenants under its revolving bank credit facility. At June 30, 2009, the Company was in compliance with these covenants. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">     At June 30, 2009, there were no bank borrowings against the revolving credit agreement. </div>   </div>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="center" style="font-size: 10pt; margin-top: 0pt"> <b> </b> </div> <div align="Center" style="font-size: 10pt; margin-top: 0pt"> <b> </b> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">     BNSF issues commercial paper from time to time that is supported by the revolving bank credit facility. Outstanding commercial paper balances reduce the amount of borrowings available under this agreement. The classification of commercial paper is determined by the Company’s ability and intent to use long-term or short-term sources to settle the obligations. As of June 30, 2009, commercial paper balances were classified as long-term debt due within one year, as the Company is currently utilizing operating cash flows to settle the obligations. Previously, the Company classified outstanding commercial paper as long-term debt. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">     The maturity value of commercial paper as of June 30, 2009, of $267 million, reduced the total capacity available under the revolving credit agreement to $933 million. </div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><u><b>Notes and Debentures</b></u> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">     In February 2009, the Board of Directors (the Board) authorized an additional $1 billion of debt securities that may be issued through the Securities and Exchange Commission (SEC) debt shelf registration process, for a total of $1.5 billion authorized to be issued as of June 30, 2009. </div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><u><b>Capital Leases</b></u> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">     During the first six months of 2009, BNSF entered into a 12-year capital lease to finance $368 million of locomotives and freight cars. Additionally, BNSF entered into capital leases totaling $65 million to finance maintenance of way and other vehicles/equipment with lease terms of five to seven years. </div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><u><b>Financing Obligation</b></u> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">     In 2005, the Company commenced the construction of an intermodal facility that it intended to sell to a third party and subsequently lease back. As of June 30, 2009, construction of the facility was substantially completed for a cost of approximately $160 million. All improvements have been sold to the third party and BNSF leased the facility from the third party for 20 years. This sale leaseback transaction was accounted for as a financing obligation due to continuing involvement. The outflows from the construction of the facility were classified as investing activities, and the inflows from the associated financing proceeds were classified as financing activities in the Company’s Consolidated Statements of Cash Flows. </div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><u><b>Fair Value of Debt Instruments</b></u> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">     At June 30, 2009 and December 31, 2008, the fair value of BNSF’s debt, excluding capital leases and interest rate hedges, was $8,399 million and $8,323 million, respectively, while the book value was $8,213 million and $8,274 million, respectively. The fair value of BNSF’s debt is primarily based on quoted market prices for the same or similar issues, or on the current rates that would be offered to BNSF for debt of the same remaining maturities. The book value of commercial paper approximates fair value due to its short maturity. </div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><u><b>Guarantees</b></u> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">     As of June 30, 2009, BNSF Railway 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. </div>   </div>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="center" style="font-size: 10pt; margin-top: 0pt"> <b> </b> </div> <div align="Center" style="font-size: 10pt; margin-top: 0pt"> <b> </b> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">     Debt and other obligations of non-consolidated entities guaranteed by the Company as of June 30, 2009, were as follows (dollars in millions): </div> <div align="center"> <table style="font-size: 10pt" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="28%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="18" style="border-bottom: 1px solid #000000"><b>Guarantees</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right" colspan="2"> </td> <td> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="right" colspan="2"><b>BNSF</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right" colspan="2"><b>Principal</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right" colspan="2"><b>Maximum</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right" colspan="2"><b>Maximum</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right" colspan="2"><b>Remaining</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right" colspan="2"> </td> <td> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="right" colspan="2"><b>Ownership</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right" colspan="2"><b>Amount</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right" colspan="2"><b>Future</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right" colspan="2"><b>Recourse</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right" colspan="2"><b>Term</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right" colspan="2"><b>Capitalized</b></td> <td> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="right" colspan="2" style="border-bottom: 1px solid #000000"><b>Percentage</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right" colspan="2" style="border-bottom: 1px solid #000000"><b>Guaranteed</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right" colspan="2" style="border-bottom: 1px solid #000000"><b>Payments</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right" colspan="2" style="border-bottom: 1px solid #000000"><b>Amount</b><sup style="font-size: 85%; vertical-align: text-top"><b>a</b></sup></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right" colspan="2" style="border-bottom: 1px solid #000000"><b>(in years)</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right" colspan="2" style="border-bottom: 1px solid #000000"><b>Obligations</b></td> <td> </td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Kinder Morgan Energy Partners, L.P. </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">0.5</td> <td nowrap="nowrap">%</td> <td> </td> <td align="left">$</td> <td align="right">190</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">190</td> <td> </td> <td> </td> <td align="left">$</td> <td nowrap="nowrap" align="right"><i>—</i></td> <td> </td> <td> </td> <td colspan="2" align="right" NOWRAP>Termination <br />of Ownership</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Kansas City Terminal Intermodal Transportation Corporation </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">0.0</td> <td nowrap="nowrap">%</td> <td> </td> <td align="left">$</td> <td align="right">52</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">72</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">72</td> <td> </td> <td> </td> <td> </td> <td align="right">9</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left">$</td> <td align="right">27</td> <td nowrap="nowrap"> <sup style="font-size: 85%; vertical-align: text-top">b</sup></td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Westside Intermodal Transportation Corporation </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">0.0</td> <td nowrap="nowrap">%</td> <td> </td> <td align="left">$</td> <td align="right">37</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">55</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">14</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left">$</td> <td align="right">30</td> <td nowrap="nowrap"> <sup style="font-size: 85%; vertical-align: text-top">b</sup></td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">The Unified Government of Wyandotte County/Kansas City, Kansas </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">0.0</td> <td nowrap="nowrap">%</td> <td> </td> <td align="left">$</td> <td align="right">12</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">17</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">14</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left">$</td> <td align="right">9</td> <td nowrap="nowrap"> <sup style="font-size: 85%; vertical-align: text-top">b</sup></td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Chevron Phillips <br /> Chemical Company, LP </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">0.0</td> <td nowrap="nowrap">%</td> <td> </td> <td colspan="2" nowrap="nowrap" align="right">N/A</td> <td><sup style="font-size: 85%; vertical-align: text-top">d</sup> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="right">N/A</td> <td><sup style="font-size: 85%; vertical-align: text-top">d</sup> </td> <td> </td> <td colspan="2" nowrap="nowrap" align="right">N/A</td> <td><sup style="font-size: 85%; vertical-align: text-top">d</sup> </td> <td> </td> <td> </td> <td align="right">8</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left">$</td> <td align="right">12</td> <td nowrap="nowrap"> <sup style="font-size: 85%; vertical-align: text-top">c</sup></td> </tr> <tr valign="bottom"> <td NOWRAP> <div style="margin-left:15px; text-indent:-15px">Various lessors<br /> (Residual value guarantees) </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">0.0</td> <td nowrap="nowrap">%</td> <td> </td> <td> </td> <td align="right">N/A</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">270</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">270</td> <td> </td> <td> </td> <td colspan="2" align="right">Various</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left">$</td> <td align="right">68</td> <td nowrap="nowrap"> <sup style="font-size: 85%; vertical-align: text-top">c</sup></td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">All other </div></td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">0.0</td> <td nowrap="nowrap">%</td> <td> </td> <td align="left">$</td> <td align="right">4</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">4</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">1</td> <td> </td> <td> </td> <td colspan="2" align="right">Various</td> <td> </td> <td> </td> <td align="left">$</td> <td align="right">—</td> <td> </td> </tr> <tr> <td nowrap="nowrap" align="center" colspan="25" style="border-top: 1px solid #000000"> </td> </tr>  </table> </div> <div align="left"> <div style="font-size: 3pt; margin-top: 6pt; width: 18%; border-top: 0px solid #000000">  </div> </div> <table width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt"> <tr> <td width="3%"></td> <td width="1%"></td> <td width="96"></td> </tr> <tr valign="top"> <td nowrap="nowrap" align="left">a </td> <td> </td> <td>Reflects the maximum amount the Company could recover from a third party other than the counterparty.</td> </tr> <tr style="font-size: 3pt"> <td> </td> </tr> <tr valign="top"> <td nowrap="nowrap" align="left">b </td> <td> </td> <td>Reflects capitalized obligations that are recorded on the Company’s Consolidated Balance Sheets.</td> </tr> <tr style="font-size: 3pt"> <td> </td> </tr> <tr valign="top"> <td nowrap="nowrap" align="left">c </td> <td> </td> <td>Reflects FASB Interpretation (FIN) 45, <i>Guarantor’s Accounting and Disclosure Requirements for Guarantees</i>, asset and corresponding liability for the fair value of these guarantees.</td> </tr> <tr style="font-size: 3pt"> <td> </td> </tr> <tr valign="top"> <td nowrap="nowrap" align="left">d </td> <td> </td> <td>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.</td> </tr> </table> <div align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 1%"><b><i>Kinder Morgan Energy Partners, L.P.</i></b> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">     Santa Fe Pacific Pipelines, Inc., an indirect, wholly-owned subsidiary of BNSF Railway, has a guarantee in connection with its remaining special limited partnership interest in Santa Fe Pacific Pipelines 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. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 1%"><b><i>Kansas City Terminal Intermodal Transportation Corporation</i></b> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">     BNSF Railway and another major railroad jointly and severally guarantee $52 million of debt of Kansas City Terminal Intermodal Transportation Corporation, the proceeds of which were used to finance construction of a double track grade separation bridge in Kansas City, Missouri, which is operated and used by Kansas City Terminal Railway Company (KCTRC). BNSF Railway has a 25 percent ownership in KCTRC, accounts for its interest using the equity method of accounting and would be required to fund a portion of the remaining obligation upon default by the original debtor. </div>   </div>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="center" style="font-size: 10pt; margin-top: 0pt"> <b> </b> </div> <div align="Center" style="font-size: 10pt; margin-top: 0pt"> <b> </b> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 1%"><b><i>Westside Intermodal Transportation Corporation and The Unified Government of</i></b><b><i> Wyandotte County/Kansas City, Kansas</i></b> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">     BNSF Railway has outstanding guarantees of $49 million of debt, the proceeds of which were used to finance construction of a bridge that connects BNSF Railway’s Argentine Yard in Kansas City, Kansas, with the KCTRC mainline tracks in Kansas City, Missouri. The bridge is operated by KCTRC, and payments related to BNSF Railway’s guarantee of this obligation would only be called for upon default by the original debtor. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 1%"><b><i>Chevron Phillips Chemical Company, LP</i></b> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">     In the third quarter of 2007, BNSF Railway entered into an indemnity agreement with Chevron Phillips Chemical Company, LP (Chevron Phillips), granting certain rights of indemnity from BNSF Railway, 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. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 1%"><b><i>Residual Value Guarantees (RVG)</i></b> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">     In the normal course of business, the Company enters into leases in which it guarantees the residual value of certain leased equipment. Some of these leases have renewal or purchase options, or both, that the Company may exercise at the end of the lease term. If the Company elects not to exercise these options, it may be required to pay the lessor an amount not exceeding the RVG. The amount of any payment is contingent upon the actual residual value of the leased equipment. Some of these leases also require the lessor to pay the Company any surplus if the actual residual value of the leased equipment is over the RVG. These guarantees will expire between 2009 and 2011. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">     The maximum future payments, as disclosed in the Guarantees table above, represent the undiscounted maximum amount that the Company could be required to pay in the event the Company did not exercise its renewal option and the fair market value of the equipment had significantly declined. BNSF does not anticipate such a large reduction in the fair market value of the leased equipment. As of June 30, 2009, the Company had recorded a $68 million asset and corresponding liability for the fair value of RVG. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 1%"><b><i>All Other</i></b> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">     As of June 30, 2009, BNSF guaranteed $4 million of other debt and leases. BNSF holds a performance bond and has the option to sub-lease property to recover up to $1 million of the $4 million of guarantees. These guarantees expire between 2011 and 2013. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">     Other than as discussed above, there is no collateral held by a third party that the Company could obtain and liquidate to recover any amounts paid under the above guarantees. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">     Other than as discussed above, none of the guarantees are recorded in the Consolidated Financial Statements of the Company. The Company does not expect performance under these guarantees to have a material effect on the Company in the foreseeable future. </div>   </div>  <div style="font-family: 'Times New Roman',Times,serif"> <div align="left" style="font-size: 10pt; margin-top: 6pt; margin-left: 1%"><b><i>Indemnities</i></b> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">     In the ordinary course of business, BNSF enters into agreements with third parties that include indemnification clauses. In general, these clauses are 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. Due to the uncertainty of 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 and that the fair value of any such amount would be immaterial to the Consolidated Financial Statements. Agreements that contain 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. </div> </div> </body> </html>  4. Debt Revolving Credit Facility and Commercial Paper false false No definition available. 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