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<SEC-DOCUMENT>0000101829-03-000199.txt : 20030423
<SEC-HEADER>0000101829-03-000199.hdr.sgml : 20030423
<ACCEPTANCE-DATETIME>20030423083917
ACCESSION NUMBER:		0000101829-03-000199
CONFORMED SUBMISSION TYPE:	10-Q
PUBLIC DOCUMENT COUNT:		5
CONFORMED PERIOD OF REPORT:	20030331
FILED AS OF DATE:		20030423

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			UNITED TECHNOLOGIES CORP /DE/
		CENTRAL INDEX KEY:			0000101829
		STANDARD INDUSTRIAL CLASSIFICATION:	AIRCRAFT ENGINES & ENGINE PARTS [3724]
		IRS NUMBER:				060570975
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		10-Q
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-00812
		FILM NUMBER:		03659117

	BUSINESS ADDRESS:	
		STREET 1:		UNITED TECHNOLOGIES BLDG
		STREET 2:		ONE FINANCIAL PLZ
		CITY:			HARTFORD
		STATE:			CT
		ZIP:			06101
		BUSINESS PHONE:		2037287000

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	UNITED TECHNOLOGIES CORP
		DATE OF NAME CHANGE:	19841205

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	UNITED TECHNOLOGIES MICROELECTRONICS CENTER
		DATE OF NAME CHANGE:	19850825
</SEC-HEADER>
<DOCUMENT>
<TYPE>10-Q
<SEQUENCE>1
<FILENAME>tenq12003.htm
<DESCRIPTION>10-Q 3/31/03
<TEXT>
<html>

<head>
<title>tenq103</title>
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</head>

<body>

<p><b><font FACE="Arial" SIZE="2"><img SRC="utcbluelogo.gif" width="543" height="90"></font></p>


<font
FACE="Arial" SIZE="5">


<p ALIGN="RIGHT"><font FACE="Arial" SIZE="3">&nbsp;</p>

<p align="center"></font>

</font>

</b>


<strong><font face="Arial" size="2">UNITED TECHNOLOGIES CORPORATION<br>
AND SUBSIDIARIES<br>
<br>
FORM 10-Q</font></strong></p>

<font
FACE="Arial" SIZE="5">

<p align="center"><strong><font FACE="Arial" SIZE="2">UNITED STATES<br>
SECURITIES AND EXCHANGE COMMISSION</font></strong></p>

<p align="center"><strong><font FACE="Arial" SIZE="2">WASHINGTON D.C.</font></strong></p>

<p align="center"><strong><font FACE="Arial" SIZE="2">20549</font></strong></p>

<p align="center"><b><font FACE="Arial" SIZE="2">[X] QUARTERLY REPORT PURSUANT TO SECTION
13 OR 15(d) OF<br>
THE SECURITIES EXCHANGE ACT OF 1934</font></p>

</b>


</font>

<b>

<p align="center"><font
FACE="Arial" size="2">&nbsp;For the quarterly period ended <u>March 31, </u></font><font face="Arial" size="2"><u>2003</u></font>

</p>

<p align="center"><font
FACE="Arial" size="2">&nbsp;&nbsp;OR</font>

</p>

<p align="center"><font FACE="Arial" size="2">&nbsp;&nbsp;[ ] TRANSITION REPORT PURSUANT TO SECTION 13
OR 15(d) OF<br>
THE SECURITIES EXCHANGE ACT OF 1934</font></p>

<p align="center"><font
FACE="Arial" size="2">&nbsp;


</font>

</p>

<font
FACE="Arial" SIZE="5">

<p align="center"><font FACE="Arial" SIZE="2">For the transition period
from____________________________to__________________________</font></p>

<p align="center">


</font>

<font face="Arial" size="2">&nbsp;</font><font
FACE="Arial" SIZE="5"><font FACE="Arial" SIZE="2">Commission file number 1-812&nbsp;</font></p>

<p align="center"><font FACE="Arial" SIZE="2">&nbsp;<u>UNITED TECHNOLOGIES CORPORATION</u></font></font></b><font face="Arial" size="2">&nbsp;</font></p>


<font
FACE="Arial" SIZE="5">
<div align="center"><center>

<table border="0" width="75%">
  <tr>
    <td width="50%"><p align="center"><b><font FACE="Arial" SIZE="2">DELAWARE</font></b></td>
    <td width="50%"><p align="center"><b><font FACE="Arial" SIZE="2">06-0570975</font></b></td>
  </tr>
</table>
</center></div><b>

<p align="center"><font FACE="Arial" SIZE="2">One Financial Plaza, Hartford, Connecticut
06103</font></p>

<p align="center"><font FACE="Arial" SIZE="2">(860) 728-7000</font></p>

</b>

<p ALIGN="JUSTIFY"><font FACE="Arial" SIZE="2">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, and (2) has been subject
to such filing requirements for the past 90 days. Yes<u> X </u>. No<u>&nbsp;&nbsp;
</u>.</font></p>


</font>

<p ALIGN="JUSTIFY"><font
FACE="Arial" size="2">Indicate
by check mark whether the Registrant is an accelerated filer (as defined in Rule
12b-2 of the Exchange Act).<br>
<font FACE="Arial">Yes<u> X </u>. No<u>&nbsp;&nbsp;
</u>.</font></font></p>

<font
FACE="Arial" SIZE="5">

<p ALIGN="JUSTIFY"><font face="Arial" size="2">At March 31, </font>


</font>

<font face="Arial" size="2">2003</font><font face="Arial" size="2">
<font
FACE="Arial" SIZE="5">


</font>

there were 467,893,607 shares of </font><font
FACE="Arial" SIZE="5"><font face="Arial" size="2"> Common Stock outstanding.</font></p>

<hr>
<b><font FACE="Arial" SIZE="3">

<p align="center"></font><font FACE="Arial" SIZE="2">UNITED TECHNOLOGIES CORPORATION<br>
AND SUBSIDIARIES</font></b></p>
<b>

<p align="center"><font FACE="Arial" SIZE="2">CONTENTS OF QUARTERLY REPORT ON FORM 10-Q<br>
Quarter Ended March 31, </font>


</font>

<font face="Arial" size="2">2003</font></p>
</b>

<font
FACE="Arial" SIZE="5">

<div align="center">
  <center>

<table CELLSPACING="0" BORDER="0" cellpadding="0" style="font-family: Arial; font-size: 10pt" width="534" height="532">
  <tr>
    <td VALIGN="TOP" width="469" height="18"><font FACE="Arial" SIZE="2">&nbsp; </font></td>
    <td VALIGN="TOP" align="center" class="botbord" width="61" height="18"><font FACE="Arial" SIZE="2"><b><u>Page</u></b></font></td>
  </tr>
  <tr>
    <td width="469" height="16"><font face="Arial" size="1">&nbsp; </font></td>
    <td align="center" width="61" height="16"><font face="Arial" size="1">&nbsp; </font></td>
  </tr>
  <tr>
    <td VALIGN="TOP" width="469" height="18"><font FACE="Arial" SIZE="2"><u>Part I - Financial Information</u></font></td>
    <td VALIGN="TOP" align="center" width="61" height="18"><font FACE="Arial" SIZE="2">&nbsp; </font></td>
  </tr>
  <tr>
    <td width="469" height="16"><font FACE="Arial" size="1">&nbsp; </font></td>
    <td align="center" width="61" height="16"><font FACE="Arial" size="1">&nbsp; </font></td>
  </tr>
  <tr>
    <td VALIGN="TOP" width="469" height="18"><font FACE="Arial" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp; Item 1. Financial
    Statements:</font></td>
    <td VALIGN="TOP" align="center" width="61" height="18"><font FACE="Arial" SIZE="2">&nbsp; </font></td>
  </tr>
  <tr>
    <td width="469" height="10"><font FACE="Arial" size="1">&nbsp; </font></td>
    <td align="center" width="61" height="10"><font FACE="Arial" size="1">&nbsp; </font></td>
  </tr>


</font>

  <tr>
    <td WIDTH="469" VALIGN="TOP" height="34">
<font
FACE="Arial" size="2">
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;


</font>

      <font size="2"><font FACE="Arial">Condensed Consolidated Statement of Operations for the quarters ended<br>
      &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; March 31,
      </font><font face="Arial">2003</font><font FACE="Arial" SIZE="2"> and </font><font face="Arial">2002</font></font></td>
    <td WIDTH="61" VALIGN="TOP" align="right" height="34"><font face="Arial" size="2">2</font>
<font
FACE="Arial" SIZE="5">
    <font FACE="Arial" SIZE="2"> &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </font></font></td>
  </tr>
  <tr>
    <td WIDTH="469" VALIGN="TOP" height="34">
<font
FACE="Arial" size="2">
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;


</font>


    <font size="2"><font FACE="Arial">Condensed Consolidated Balance Sheet at March 31,
    </font><font face="Arial">2003 and <br>
      &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; December 31,
    2002</font></font></td>


    <td WIDTH="61" VALIGN="TOP" align="right" height="34"><font face="Arial" size="2">3
      &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="469" VALIGN="TOP" height="34">
<font
FACE="Arial" size="2">
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;


</font>

      <font size="2"><font FACE="Arial">Condensed Consolidated Statement of Cash Flows for the
      quarters&nbsp;<br>
      &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; ended March 31, </font>


      <font face="Arial">2003</font><font
FACE="Arial"> and 2002</font></font></td>


    <td WIDTH="61" VALIGN="TOP" align="right" height="34"><font face="Arial" size="2">4
      &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="469" VALIGN="TOP" height="18">
<font
FACE="Arial" size="2">
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Notes to Condensed Consolidated Financial Statements


</font>

    </td>


    <td WIDTH="61" VALIGN="TOP" align="right" height="18"><font face="Arial" size="2">5
      &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="469" VALIGN="TOP" height="18">
<font
FACE="Arial" size="2">
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Report of Independent Auditors


</font>

    </td>
    <td WIDTH="61" VALIGN="TOP" align="right" height="18"><font FACE="Arial" SIZE="2">12
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
  </tr>
<tr>
<font
FACE="Arial" SIZE="5">
    <td width="469" height="7"><font FACE="Arial" size="1">&nbsp; </font>


</font>

<font face="Arial" size="1">&nbsp;&nbsp;</font></td>
<font
FACE="Arial" SIZE="5">
    <td align="center" width="61" height="7"><font FACE="Arial" size="1">&nbsp; </font></td>


</font>

</tr>
  <tr>
    <td WIDTH="469" VALIGN="TOP" height="34"><font FACE="Arial" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;
      Item 2. Management's Discussion and Analysis of Financial Condition<br>
      &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; and Results of Operations</font></td>
    <td WIDTH="61" VALIGN="TOP" align="right" height="34"><font FACE="Arial" SIZE="2">13
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
  </tr>
<tr>
<font
FACE="Arial" SIZE="5">
    <td width="469" height="16"><font FACE="Arial" size="1">&nbsp; </font>


</font>

<font face="Arial" size="1">&nbsp;&nbsp;</font></td>
<font
FACE="Arial" SIZE="5">
    <td align="center" width="61" height="16"><font FACE="Arial" size="1">&nbsp; </font></td>


</font>

</tr>
  <tr>
    <td WIDTH="469" VALIGN="TOP" height="18"><font FACE="Arial" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;
      Item 3. Quantitative and Qualitative Disclosures About Market Risk</font></td>
    <td WIDTH="61" VALIGN="TOP" align="right" height="18"><font FACE="Arial" SIZE="2">20&nbsp;
      </font>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</td>
  </tr>
<tr>
<font
FACE="Arial" SIZE="5">
    <td width="469" height="16"><font FACE="Arial" size="1">&nbsp; </font>


</font>

<font face="Arial" size="1">&nbsp;&nbsp;</font></td>
<font
FACE="Arial" SIZE="5">
    <td align="center" width="61" height="16"><font FACE="Arial" size="1">&nbsp; </font></td>


</font>

</tr>
  <tr>
    <td WIDTH="469" height="18"><font FACE="Arial" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;
      Item 4. Controls and Procedures</font></td>
    <td WIDTH="61" align="right" height="18"><font FACE="Arial" SIZE="2">20&nbsp;
      </font>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</td>
  </tr>
<tr>
<font
FACE="Arial" SIZE="5">
    <td width="469" height="16"><font FACE="Arial" size="1">&nbsp; </font></td>
    <td align="center" width="61" height="16"><font FACE="Arial" size="1">&nbsp; </font></td>


</font>

</tr>
  <tr>
    <td WIDTH="469" VALIGN="TOP" height="21"><u><font FACE="Arial" SIZE="2">Part II - Other
    Information</font></u></td>
    <td WIDTH="61" VALIGN="TOP" align="right" height="21"></td>
  </tr>
<tr>
<font
FACE="Arial" SIZE="5">
    <td width="469" height="16"><font FACE="Arial" size="1">&nbsp; </font></td>
    <td align="center" width="61" height="16"><font FACE="Arial" size="1">&nbsp; </font></td>


</font>

</tr>
  <tr>
    <td WIDTH="469" height="18" style="font-family: Arial; font-size: 10pt">


    <font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp; Item 1. Legal
    Proceedings</font>

    </td>
    <td WIDTH="61" align="right" height="18" style="font-family: Arial; font-size: 10pt" valign="top"><font face="Arial" size="2">22&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>
<tr>
<font
FACE="Arial" SIZE="5">
    <td width="469" height="16"><font FACE="Arial" size="1">&nbsp; </font></td>
    <td align="center" width="61" height="16"><font FACE="Arial" size="1">&nbsp; </font></td>


</font>

</tr>
  <tr>
    <td WIDTH="469" height="18" style="font-family: Arial; font-size: 10pt"><font FACE="Arial" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;
      </font>Item 6. Exhibits and Reports on Form 8-K</td>
    <td WIDTH="61" align="right" height="18" style="font-family: Arial; font-size: 10pt" valign="top"><font face="Arial" size="2">23&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>

<tr>
<font
FACE="Arial" SIZE="5">
    <td width="469" height="16"><font FACE="Arial" size="1">&nbsp; </font></td>
    <td align="center" width="61" height="16"><font FACE="Arial" size="1">&nbsp; </font></td>


</font>

</tr>


<font
FACE="Arial" SIZE="5">


  <tr>
    <td WIDTH="469" VALIGN="TOP" height="18"><font FACE="Arial" SIZE="2">Signatures</font></td>
    </font>
    <td WIDTH="61" VALIGN="TOP" align="right" height="18" style="font-family: Arial; font-size: 10pt"><font face="Arial" size="2">24&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="469" height="18"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
<font
FACE="Arial" SIZE="5">
    <td WIDTH="61" align="right" height="18" style="font-family: Arial; font-size: 10pt" valign="top"></td>
  </tr>
</font>
  <tr>
    <td WIDTH="469" height="18">
<font
FACE="Arial" size="2">
  Certifications
</font>
    </td>
<font
FACE="Arial" SIZE="5">
    <td WIDTH="61" align="right" height="18" style="font-family: Arial; font-size: 10pt" valign="top"><font face="Arial" size="2">2</font></font><font face="Arial" size="2">5&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font><font
FACE="Arial" SIZE="5"></font></td>
  </tr>
    <tr>
    <td width="469" height="16"><font FACE="Arial" size="1">&nbsp; </font></td>
    <td align="center" width="61" height="16"><font FACE="Arial" size="1">&nbsp; </font></td>
    </tr>
  <tr>
    <td WIDTH="469" VALIGN="TOP" height="18"><font FACE="Arial" SIZE="2">Exhibit Index</font></td>
    <td WIDTH="61" VALIGN="TOP" align="right" height="18" style="font-family: Arial; font-size: 10pt"><font face="Arial" size="2">27&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>
</table>

</center>
</div>

<p ALIGN="JUSTIFY"><font face="Arial" size="2">"Corporation,"
unless the context otherwise requires, means United Technologies Corporation or
UTC and its subsidiaries.&nbsp;</font></p>
<font FACE="Arial" SIZE="2"><font
FACE="Arial" SIZE="5">
<font FACE="Arial" SIZE="3">

<hr>
<b>

<p align="center"><font FACE="Arial" SIZE="2">UNITED TECHNOLOGIES CORPORATION<br>
AND SUBSIDIARIES</font></p>
</b>

</font>

<b>

<p><font FACE="Arial" SIZE="2">Part I &#150; Financial Information</font></p>

<blockquote>
  <p><font FACE="Arial" SIZE="2">Item 1 &#150; Financial Statements</font></p>
</blockquote>

<p ALIGN="CENTER"><font FACE="Arial" SIZE="2"><u>CONDENSED CONSOLIDATED STATEMENT OF
OPERATIONS</u><br>
(Unaudited)</font>

<p ALIGN="CENTER"></b></font></font>

<div align="center">
  <center>

<table CELLSPACING="0" BORDER="0">
  <tr>
    <td WIDTH="300" VALIGN="TOP" height="35"><font face="Arial" size="2"><br>
    In Millions (except per share amounts)</font></td>
    <td WIDTH="17" VALIGN="TOP" height="35"></td>
    <td WIDTH="169" align="center" colspan="3" class="botbord" height="35"><font face="Arial" size="2"><b>Quarter
      Ended<br>
      March 31,&nbsp;</b></font></td>
  </tr>
<font face="Arial" size="2">
  <tr>
    <td WIDTH="300" VALIGN="TOP" height="18">&nbsp;&nbsp;</td>
    <td WIDTH="17" VALIGN="TOP" height="18">&nbsp;&nbsp;</td>
    </font>
    <td WIDTH="79" VALIGN="TOP" align="center" height="18"><font face="Arial" size="2"><u><b>2003</b></u></font></td>
<font FACE="Arial" SIZE="2">
    <td WIDTH="13" VALIGN="TOP" height="18" align="center"></td>
    </font>
    <td WIDTH="69" VALIGN="TOP" class="botbord" height="18" align="center"><p align="center"><b><font face="Arial" size="2"><u>2002</u></font></b></td>
  </tr>
  <tr>
    <td WIDTH="300" VALIGN="TOP" height="18">
<font face="Arial" SIZE="2">Revenues</font></td>
    <td WIDTH="17" VALIGN="TOP" height="18">
<font face="Arial" SIZE="2">&nbsp;&nbsp;</font></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="18">
<font face="Arial" size="2">&nbsp;&nbsp;</font></td>
    <td WIDTH="13" VALIGN="top" height="18">
<font face="Arial" SIZE="2">&nbsp;&nbsp;</font></td>
    <td WIDTH="69" VALIGN="TOP" height="18">
<font face="Arial" SIZE="2">&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="300" VALIGN="TOP" height="18">
<font face="Arial" SIZE="2">&nbsp;&nbsp;&nbsp; Product sales</font></td>
    <td WIDTH="17" VALIGN="TOP" height="18"><p ALIGN="center">
<font face="Arial" SIZE="2">$</font></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="18">
    <font size="2" face="Arial">4,864&nbsp;&nbsp;&nbsp;&nbsp;</font>
    </td>

    <td WIDTH="13" VALIGN="TOP" height="18"><p ALIGN="right">
<font face="Arial" SIZE="2">$</font></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="18">
      <p align="right">
<font face="Arial" SIZE="2">4,700&nbsp;&nbsp;&nbsp;&nbsp;</font></p>
    </td>

  </tr>
  <tr>
    <td WIDTH="300" VALIGN="TOP" height="18">
<font face="Arial" SIZE="2">&nbsp;&nbsp;&nbsp; Service sales</font></td>
    <td WIDTH="17" VALIGN="TOP" height="18">
<font face="Arial" SIZE="2">&nbsp;&nbsp;</font></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="18">
    <font face="Arial" size="2">1,789&nbsp;&nbsp;&nbsp;&nbsp;</font>
    </td>
    <td WIDTH="13" VALIGN="TOP" height="18">
<font face="Arial" SIZE="2">&nbsp;&nbsp;</font></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="18">
<font face="Arial" SIZE="2">1,621&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="300" VALIGN="TOP" height="21">
<font face="Arial" SIZE="2">&nbsp;&nbsp;&nbsp; Financing
    revenues and other income, net</font></td>
    <td WIDTH="17" VALIGN="TOP" height="21">
<font face="Arial" SIZE="2">&nbsp;&nbsp;</font></td>
    <td WIDTH="79" VALIGN="top" align="right" height="21">
    <font size="2" face="Arial">49&nbsp;&nbsp;&nbsp;&nbsp;</font>
    </td>
    <td WIDTH="13" VALIGN="TOP" height="21"></td>
    <td WIDTH="79" VALIGN="top" align="right" height="21">
<font face="Arial" SIZE="2">&nbsp;&nbsp;&nbsp; &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
53&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="300" height="21"></td>
    <td WIDTH="17" height="21"></td>
    <td WIDTH="79" align="right" height="21" style="border-top: thin solid; border-bottom: thin solid"><font size="2" face="Arial">6,702&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="13" height="21"></td>
    <td WIDTH="79" align="right" height="21" style="border-top: thin solid; border-bottom: thin solid"><font face="Arial" SIZE="2">&nbsp;&nbsp; 6,374&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="300" VALIGN="TOP" height="21"><font FACE="Arial" SIZE="2">Costs and
      expenses</font></td>
    <td WIDTH="17" VALIGN="TOP" height="21"></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="21"><font face="Arial" size="2">&nbsp;&nbsp;</font></td>
    <td WIDTH="13" VALIGN="TOP" height="21"></td>
    <td WIDTH="69" VALIGN="TOP" align="right" height="21"></td>
  </tr>
  <tr>
    <td WIDTH="300" VALIGN="TOP" height="21"><font FACE="Arial" SIZE="2">&nbsp;&nbsp;&nbsp; Cost of
    products sold</font></td>
    <td WIDTH="17" VALIGN="TOP" height="21"></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="21"><font size="2" face="Arial">3,707&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="13" VALIGN="TOP" height="21"></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="21"><font FACE="Arial" SIZE="2">3,420&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="300" VALIGN="TOP" height="21"><font FACE="Arial" SIZE="2">&nbsp;&nbsp;&nbsp; Cost of
    services sold</font></td>
    <td WIDTH="17" VALIGN="TOP" height="21"></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="21"><font size="2" face="Arial">1,159&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="13" VALIGN="TOP" height="21"></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="21"><font FACE="Arial" SIZE="2">1,065 &nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="300" VALIGN="TOP" height="19"><font FACE="Arial" SIZE="2">&nbsp;&nbsp;&nbsp; Research and
    development</font></td>
    <td WIDTH="17" VALIGN="TOP" height="19"></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="19"><font size="2" face="Arial">235&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="13" VALIGN="TOP" height="19"></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="19"><font FACE="Arial" SIZE="2">338 &nbsp;
      &nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="300" VALIGN="TOP" height="21"><font FACE="Arial" SIZE="2">&nbsp;&nbsp;&nbsp; Selling,
    general and administrative</font></td>
    <td WIDTH="17" VALIGN="TOP" height="21"></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="21"><font size="2" face="Arial">764&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="13" VALIGN="TOP" height="21"></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="21"><font FACE="Arial" SIZE="2">754 &nbsp;
      &nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="300" VALIGN="TOP" height="21"><font FACE="Arial" SIZE="2">&nbsp;&nbsp;&nbsp; Interest</font></td>
    <td WIDTH="17" VALIGN="TOP" height="21"></td>
    <td WIDTH="79" VALIGN="top" align="right" style=border-top: thin solid; border-bottom: thin solid" height="21"><font size="2" face="Arial">91&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="13" VALIGN="TOP" height="21"></td>
    <td WIDTH="79" VALIGN="top" align="right" style=border-top: thin solid; border-bottom: thin solid" height="21"><font
    FACE="Arial" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp; &nbsp; 99&nbsp;&nbsp; &nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="300" VALIGN="TOP" height="21"></td>
    <td WIDTH="17" VALIGN="TOP" height="21"></td>
    <td WIDTH="79" VALIGN="top" align="right" height="21" style="border-top-style: solid; border-top-width: thin; border-bottom-style: solid; border-bottom-width: thin"><font size="2" face="Arial">5,956&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="13" VALIGN="TOP" height="21"></td>
    <td WIDTH="79" VALIGN="top" align="right" height="21" style="border-top-style: solid; border-top-width: thin; border-bottom-style: solid; border-bottom-width: thin"><font FACE="Arial" SIZE="2">&nbsp;
      5,676&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="300" height="1"><font size="1">&nbsp;</font></td>
    <td WIDTH="17" height="1"><font size="1">&nbsp;</font></td>
    <td WIDTH="79" align="right" height="1"><font size="2" face="Arial">&nbsp;</font></td>
    <td WIDTH="13" height="1"><font size="1">&nbsp;</font></td>
    <td align="right" width="69" height="1"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="300" VALIGN="TOP" height="21"><font FACE="Arial" SIZE="2">Income before income taxes and
    minority interests</font></td>
    <td WIDTH="17" VALIGN="TOP" height="21"></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="21"><font size="2" face="Arial">746&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="13" VALIGN="TOP" height="21"></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="21"><font FACE="Arial" SIZE="2">698 &nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="300" VALIGN="TOP" height="21"><font FACE="Arial" SIZE="2">Income taxes</font></td>
    <td WIDTH="17" VALIGN="TOP" height="21"></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="21"><font size="2" face="Arial">209&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="13" VALIGN="TOP" height="21"></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="21"><font FACE="Arial" SIZE="2">198
    &nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="300" VALIGN="TOP" height="21"><font FACE="Arial" SIZE="2">Minority interests</font></td>
    <td WIDTH="17" VALIGN="TOP" height="21"></td>
    <td WIDTH="79" VALIGN="top" align="right" height="21" class="botbord"><font size="2" face="Arial">35&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="13" VALIGN="TOP" height="21"></td>
    <td WIDTH="79" VALIGN="top" align="right" height="21" class="botbord"><font
    FACE="Arial" SIZE="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 33&nbsp; &nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="300" height="20"><font FACE="Arial" SIZE="2">Net income </font></td>
    <td WIDTH="17" height="20"><p ALIGN="center"><font FACE="Arial" SIZE="2">$</font></td>

  </center>

    <td WIDTH="79" height="20" style="border-top: thin solid; border-bottom: thick double">
    <p align="right"><font size="2" face="Arial">502&nbsp;&nbsp;&nbsp;&nbsp;</font>
    </td>

  <center>

    <td WIDTH="13" height="20"><p ALIGN="right"><font FACE="Arial" SIZE="2">$</font></td>

    <td WIDTH="79" height="20" style="border-top: thin solid; border-bottom: thick double">
      <p align="right"><font
    FACE="Arial" SIZE="2">467 &nbsp;&nbsp;&nbsp; </font></p>
    </td>

  </tr>
  <center>

  <tr>
    <td WIDTH="300" VALIGN="top" height="9"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
    <td WIDTH="17" VALIGN="top" height="9"><font size="1">&nbsp;</font></td>

  </center>
    <td WIDTH="79" VALIGN="top" align="right" height="9">
    <font size="2" face="Arial">&nbsp;</font>
    </td>

    <td WIDTH="13" VALIGN="top" height="9"><font size="1">&nbsp;</font></td>
    <td WIDTH="69" VALIGN="top" align="right" height="9"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="300" VALIGN="TOP" height="21"><font SIZE="2" face="Arial">Earnings per share of Common
      Stock</font></td>
    <td WIDTH="17" VALIGN="TOP" height="21"></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="21"></td>
    <td WIDTH="13" VALIGN="TOP" height="21"></td>
    <td WIDTH="69" VALIGN="TOP" align="right" height="21"></td>
  </tr>
  <tr>
    <td WIDTH="300" VALIGN="TOP" height="18"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp; Basic</font></td>
    <td WIDTH="17" VALIGN="TOP" align="center" height="18"><p ALIGN="RIGHT"><font SIZE="2" face="Arial">$</font></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="18"><font size="2" face="Arial">1.05&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="13" VALIGN="TOP" align="center" height="18"><p ALIGN="RIGHT"><font SIZE="2" face="Arial">$</font></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="18"><font size="2" face="Arial">.97
      &nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="300" VALIGN="TOP" height="18"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp; Diluted</font></td>
    <td WIDTH="17" VALIGN="TOP" align="center" height="18"><p align="right"><font SIZE="2" face="Arial">$</font></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="18"><font size="2" face="Arial">1.00&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="13" VALIGN="TOP" align="center" height="18"><p align="right"><font SIZE="2" face="Arial">$</font></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="18"><font SIZE="2" face="Arial">.92
    &nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="300" height="2"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
    <td WIDTH="17" align="center" height="2"><font size="1">&nbsp;</font></td>
    <td WIDTH="79" align="right" height="2"><font size="2" face="Arial">&nbsp;</font></td>
    <td WIDTH="13" align="center" height="2"><font size="1">&nbsp;</font></td>
    <td WIDTH="79" align="right" height="2"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="300" VALIGN="TOP" height="18"><font SIZE="2" face="Arial">Dividends per share of Common
      Stock</font></td>
    <td WIDTH="17" VALIGN="TOP" align="center" height="18"><p ALIGN="RIGHT"><font SIZE="2" face="Arial">$</font></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="18"><font SIZE="2" face="Arial">.245&nbsp;
      &nbsp;</font></td>
    <td WIDTH="13" VALIGN="TOP" align="center" height="18"><p ALIGN="RIGHT"><font SIZE="2" face="Arial">$</font></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="18"><font SIZE="2" face="Arial">.245&nbsp;
      &nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="300" height="1"><font face="Arial" size="1">&nbsp;</font></td>
    <td WIDTH="17" height="1"><font size="1">&nbsp;</font></td>
    <td WIDTH="79" align="right" height="1"><font size="2" face="Arial">&nbsp;</font></td>
    <td WIDTH="13" height="1"><font size="1">&nbsp;</font></td>
    <td WIDTH="69" align="right" height="1"><font size="1">&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="300" VALIGN="TOP" height="21"><font SIZE="2" face="Arial">Average number of shares
      outstanding</font></td>
    <td WIDTH="17" VALIGN="TOP" height="21"></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="21"><font size="2" face="Arial">&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="13" VALIGN="TOP" height="21"></td>
    <td WIDTH="69" VALIGN="TOP" align="right" height="21"></td>
  </tr>
  <tr>
    <td WIDTH="300" VALIGN="TOP" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp; Basic</font></td>
    <td WIDTH="17" VALIGN="TOP" height="21"></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="21"><font size="2" face="Arial">470&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="13" VALIGN="TOP" height="21"></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="21"><font SIZE="2" face="Arial">473&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="300" VALIGN="TOP" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp; Diluted</font></td>
    <td WIDTH="17" VALIGN="TOP" height="21"></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="21"><font size="2" face="Arial">501&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="13" VALIGN="TOP" height="21"></td>
    <td WIDTH="79" VALIGN="TOP" align="right" height="21"><font SIZE="2" face="Arial">507&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>
</table>

</div>

  </center>

<p><font SIZE="2" face="Arial">See accompanying Notes to Condensed Consolidated Financial
Statements</font></p>

<p align="center"><font size="2" face="Arial">2</font></p>

<hr>
<b>

<p align="center"><font SIZE="2" face="Arial">UNITED TECHNOLOGIES CORPORATION<br>
AND SUBSIDIARIES</font></b></p>

<p align="center"><font SIZE="2" face="Arial"><b><u>CONDENSED CONSOLIDATED BALANCE SHEET</u></b></font></p>

<p ALIGN="RIGHT">&nbsp;</p>

<div align="center">
  <center>

<table CELLSPACING="1" BORDER="0" width="556">
  <tr>
    <td WIDTH="306" VALIGN="top" HEIGHT="50"><font SIZE="2" face="Arial"><br>
    <br>
    In Millions</font></td>
    <td WIDTH="12" VALIGN="top" HEIGHT="50"></td>
    <td WIDTH="94" VALIGN="bottom" HEIGHT="50" class="botbord"><font SIZE="2" face="Arial"><p
    align="center"><b>March 31,<br>
      <u>
      2003</u></b></font></td>
    <td WIDTH="15" VALIGN="bottom" HEIGHT="50" class="botbord"></td>
    <td WIDTH="97" VALIGN="bottom" HEIGHT="50" class="botbord"><font SIZE="2" face="Arial"><p
    align="center"><b>December 31,<br>
      <u>
      2002</u></b></font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="top" HEIGHT="21"><font SIZE="2" face="Arial">&nbsp; </font></td>
    <td WIDTH="12" VALIGN="top" HEIGHT="21"></td>
    <td WIDTH="94" VALIGN="top" HEIGHT="21">
      <p align="center"><font SIZE="2" face="Arial"><b>(Unaudited)</b></font></td>
    <td WIDTH="15" VALIGN="top" HEIGHT="21"></td>
    <td WIDTH="97" VALIGN="top" HEIGHT="21"></td>
  </tr>
  <tr>
    <td WIDTH="548" VALIGN="TOP" HEIGHT="18" colspan="5"><p align="center"><font SIZE="2"
    face="Arial"><b><u>Assets</u></b></font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="top" HEIGHT="21"><font SIZE="2" face="Arial">&nbsp; </font></td>
    <td WIDTH="12" VALIGN="top" HEIGHT="21"></td>
    <td WIDTH="94" VALIGN="top" HEIGHT="21"></td>
    <td WIDTH="15" VALIGN="top" HEIGHT="21"></td>
    <td WIDTH="97" VALIGN="top" HEIGHT="21"></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="top" height="18"><font SIZE="2" face="Arial">Cash and cash
    equivalents</font></td>
    <td WIDTH="12" VALIGN="top" height="18"><p ALIGN="RIGHT"><font SIZE="2" face="Arial">$</font></td>
    <td WIDTH="94" VALIGN="top" align="right" height="18"><font SIZE="2" face="Arial">1,927
    &nbsp;&nbsp;&nbsp; </font></td>
    <td WIDTH="15" VALIGN="top" height="18"><p ALIGN="center"><font SIZE="2" face="Arial">$</font></td>
    <td WIDTH="97" VALIGN="top" align="right" height="18"><font size="2" face="Arial">2,080
      &nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="top" height="21"><font SIZE="2" face="Arial">Accounts receivable,
    net</font></td>
    <td WIDTH="12" VALIGN="top" height="21"></td>
    <td WIDTH="94" VALIGN="top" align="right" height="21"><font SIZE="2" face="Arial">4,343
    &nbsp;&nbsp;&nbsp; </font></td>
    <td WIDTH="15" VALIGN="top" height="21"></td>
    <td WIDTH="97" VALIGN="top" align="right" height="21"><font size="2" face="Arial">4,277
      &nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="top" height="21"><font SIZE="2" face="Arial">Inventories and
    contracts in progress, net</font></td>
    <td WIDTH="12" VALIGN="top" height="21"></td>
    <td WIDTH="94" VALIGN="top" align="right" height="21"><font SIZE="2" face="Arial">3,963
    &nbsp;&nbsp;&nbsp; </font></td>
    <td WIDTH="15" VALIGN="top" height="21"></td>
    <td WIDTH="97" VALIGN="top" align="right" height="21"><font SIZE="2" face="Arial">3,803
    &nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="top" height="21"><font SIZE="2" face="Arial">Future income tax
    benefits</font></td>
    <td WIDTH="12" VALIGN="top" height="21"></td>
    <td WIDTH="94" VALIGN="top" align="right" height="21"><font SIZE="2" face="Arial">1,390
    &nbsp;&nbsp;&nbsp; </font></td>
    <td WIDTH="15" VALIGN="top" height="21"></td>
    <td WIDTH="97" VALIGN="top" align="right" height="21"><font SIZE="2" face="Arial">1,431
    &nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="top" height="21"><font SIZE="2" face="Arial">Other current assets</font></td>
    <td WIDTH="12" VALIGN="top" height="21"></td>
    <td WIDTH="94" VALIGN="top" align="right" height="21" class="botbord"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;
    &nbsp;&nbsp;&nbsp; 306&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
    <td WIDTH="15" VALIGN="top" height="21"></td>
    <td WIDTH="97" VALIGN="top" align="right" height="21" class="botbord"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;
      &nbsp; 244&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="top" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    Total Current Assets</font></td>
    <td WIDTH="12" VALIGN="top" height="21"></td>
    <td WIDTH="96" VALIGN="top" align="right" height="21" style="border-top-style: solid; border-top-width: thin; border-bottom-style: solid; border-bottom-width: thin"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;
      11,929&nbsp; &nbsp;&nbsp;
    </font></td>
    <td WIDTH="15" VALIGN="top" height="21"></td>
    <td WIDTH="99" VALIGN="top" align="right" height="21" style="border-top-style: solid; border-top-width: thin; border-bottom-style: solid; border-bottom-width: thin"><font SIZE="2" face="Arial">&nbsp;
      11,835&nbsp;&nbsp;&nbsp;&nbsp;
    </font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="top" height="21"><font face="Arial" size="2">Customer
      financing assets</font></td>
    <td WIDTH="12" VALIGN="top" height="21"></td>
    <td WIDTH="94" VALIGN="top" align="right" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;
    &nbsp;&nbsp;&nbsp; 805&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
    <td WIDTH="15" VALIGN="top" height="21"></td>
    <td WIDTH="97" VALIGN="top" align="right" height="21"><font face="Arial" size="2">771&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="top" height="21"><font face="Arial" size="2">Future
      income tax benefits</font></td>
    <td WIDTH="12" VALIGN="top" height="21"></td>
    <td WIDTH="94" VALIGN="top" align="right" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;
    &nbsp;&nbsp;&nbsp; 1,620&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
    <td WIDTH="15" VALIGN="top" height="21"></td>
    <td WIDTH="97" VALIGN="top" align="right" height="21"><font face="Arial" size="2">1,658&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="top" height="21"><font SIZE="2" face="Arial">Fixed assets</font></td>
    <td WIDTH="12" VALIGN="top" height="21"></td>
    <td WIDTH="94" VALIGN="top" align="right" height="21"><font SIZE="2" face="Arial">10,926
    &nbsp;&nbsp;&nbsp; </font></td>
    <td WIDTH="15" VALIGN="top" height="21"></td>
    <td WIDTH="97" VALIGN="top" align="right" height="21"><font SIZE="2" face="Arial">10,869
      &nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="top" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      Less: Accumulated depreciation</font></td>
    <td WIDTH="12" VALIGN="top" height="21"></td>
    <td WIDTH="94" VALIGN="top" height="21"><p align="right"><font SIZE="2" face="Arial">&nbsp;&nbsp;
      (6,431)&nbsp;&nbsp;&nbsp; </font></td>
    <td WIDTH="15" VALIGN="top" height="21"></td>
    <td WIDTH="97" VALIGN="top" align="right" height="21"><font SIZE="2" face="Arial">&nbsp;
      (6,282)&nbsp;&nbsp;&nbsp;
    </font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="top" height="21"><font SIZE="2" face="Arial">&nbsp; </font></td>
    <td WIDTH="12" VALIGN="top" height="21"></td>
    <td WIDTH="96" VALIGN="top" align="right" height="21" style="border-top-style: solid; border-top-width: thin; border-bottom-style: solid; border-bottom-width: thin"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;
      4,495&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
    <td WIDTH="15" VALIGN="top" height="21"></td>
    <td WIDTH="99" VALIGN="top" align="right" height="21" style="border-top-style: solid; border-top-width: thin; border-bottom-style: solid; border-bottom-width: thin"><font SIZE="2" face="Arial">&nbsp;&nbsp;
      4,587&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="top" height="21"><font SIZE="2" face="Arial">Goodwill</font></td>
    <td WIDTH="12" VALIGN="top" height="21"></td>
    <td WIDTH="94" VALIGN="top" align="right" height="21"><font SIZE="2" face="Arial">7,004
    &nbsp;&nbsp;&nbsp; </font></td>
    <td WIDTH="15" VALIGN="top" height="21"></td>
    <td WIDTH="97" VALIGN="top" align="right" height="21"><font SIZE="2" face="Arial">6,981
    &nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="top" height="21"><font SIZE="2" face="Arial">Other assets</font></td>
    <td WIDTH="12" VALIGN="top" height="21"></td>
    <td WIDTH="96" VALIGN="top" align="right" height="21" style="border-bottom-style: solid; border-bottom-width: thin"><font
    SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp; 3,866&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
    <td WIDTH="15" VALIGN="top" height="21"></td>
    <td WIDTH="99" VALIGN="top" align="right" height="21" style="border-right-style: solid; border-right-width: 0; border-top-style: solid; border-top-width: 0; border-bottom-style: solid; border-bottom-width: thin"><font
    SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3,342&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="top" HEIGHT="24"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    Total Assets</font></td>
    <td WIDTH="12" VALIGN="top" HEIGHT="24"><p ALIGN="RIGHT"><font SIZE="2" face="Arial">$</font></td>
    <td WIDTH="96" VALIGN="top" HEIGHT="24" align="right" style="border-bottom-style: double; border-bottom-width: thick"><font
    SIZE="2" face="Arial">29,719 &nbsp;&nbsp;&nbsp; </font></td>
    <td WIDTH="15" VALIGN="top" HEIGHT="24"><p ALIGN="RIGHT"><font SIZE="2" face="Arial">$</font></td>
    <td WIDTH="99" VALIGN="top" HEIGHT="24" align="right" class="double" style="border-bottom-style: double; border-bottom-width: thick"><font
    SIZE="2" face="Arial">29,174 &nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td VALIGN="top" COLSPAN="5" height="21" width="548"><font face="Arial" size="1"></font></td>
  </tr>
  <tr>
    <td WIDTH="548" VALIGN="top" COLSPAN="5" height="18"><p align="center"><font SIZE="2"
    face="Arial"><b><u>Liabilities and Shareowners' Equity</u></b></font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="top" HEIGHT="21"><font face="Arial" size="1">&nbsp; </font></td>
    <td WIDTH="12" VALIGN="top" HEIGHT="21"><font face="Arial" size="1"></font></td>
    <td WIDTH="94" VALIGN="top" HEIGHT="21"></td>
    <td WIDTH="15" VALIGN="top" HEIGHT="21"></td>
    <td WIDTH="97" VALIGN="top" HEIGHT="21"><font face="Arial" size="1"></font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="TOP" HEIGHT="18"><font SIZE="2" face="Arial">Short-term borrowings</font></td>
    <td WIDTH="12" VALIGN="TOP" HEIGHT="18"><p ALIGN="RIGHT"><font SIZE="2" face="Arial">$</font></td>
    <td WIDTH="94" VALIGN="TOP" HEIGHT="18" align="right"><font size="2" face="Arial">224
      &nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="15" VALIGN="TOP" HEIGHT="18"><p ALIGN="RIGHT"><font SIZE="2" face="Arial">$</font></td>
    <td WIDTH="97" VALIGN="TOP" HEIGHT="18" align="right"><font size="2" face="Arial">197
      &nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="TOP" HEIGHT="21"><font SIZE="2" face="Arial">Accounts payable</font></td>
    <td WIDTH="12" VALIGN="TOP" HEIGHT="21"></td>
    <td WIDTH="94" VALIGN="TOP" HEIGHT="21" align="right"><font SIZE="2" face="Arial">2,291
    &nbsp;&nbsp;&nbsp; </font></td>
    <td WIDTH="15" VALIGN="TOP" HEIGHT="21"></td>
    <td WIDTH="97" VALIGN="TOP" HEIGHT="21" align="right"><font SIZE="2" face="Arial">2,095
    &nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="TOP" HEIGHT="21"><font SIZE="2" face="Arial">Accrued liabilities</font></td>
    <td WIDTH="12" VALIGN="TOP" HEIGHT="21"></td>
    <td WIDTH="94" VALIGN="TOP" HEIGHT="21" align="right"><font SIZE="2" face="Arial">5,679
    &nbsp;&nbsp;&nbsp; </font></td>
    <td WIDTH="15" VALIGN="TOP" HEIGHT="21"></td>
    <td WIDTH="97" VALIGN="TOP" HEIGHT="21" align="right"><font SIZE="2" face="Arial">5,651
    &nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="TOP" HEIGHT="21"><font SIZE="2" face="Arial">Long-term debt
    currently due</font></td>
    <td WIDTH="12" VALIGN="TOP" HEIGHT="21"></td>
    <td WIDTH="94" VALIGN="TOP" HEIGHT="21" align="right"><font SIZE="2" face="Arial">&nbsp;&nbsp;
      &nbsp;&nbsp;
    &nbsp; 48&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
    <td WIDTH="15" VALIGN="TOP" HEIGHT="21"></td>
    <td WIDTH="97" VALIGN="TOP" HEIGHT="21" align="right"><font SIZE="2" face="Arial">&nbsp;
    &nbsp;&nbsp;&nbsp; 44&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="TOP" HEIGHT="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    Total Current Liabilities</font></td>
    <td WIDTH="12" VALIGN="TOP" HEIGHT="21"></td>
    <td WIDTH="96" VALIGN="top" HEIGHT="21" align="right" style="border-top-style: solid; border-top-width: thin; border-bottom-style: solid; border-bottom-width: thin"><font SIZE="2" face="Arial">&nbsp;
    &nbsp; 8,242&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
    <td WIDTH="15" VALIGN="TOP" HEIGHT="21"></td>
    <td WIDTH="99" VALIGN="top" HEIGHT="21" align="right" style="border-top-style: solid; border-top-width: thin; border-bottom-style: solid; border-bottom-width: thin"><font SIZE="2" face="Arial">&nbsp;
    &nbsp;7,987&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="top" HEIGHT="21"><font face="Arial" size="1">&nbsp; </font></td>
    <td WIDTH="12" VALIGN="top" HEIGHT="21"><font face="Arial" size="1"></font></td>
    <td WIDTH="94" VALIGN="top" HEIGHT="21" align="right"></td>
    <td WIDTH="15" VALIGN="top" HEIGHT="21"></td>
    <td WIDTH="97" VALIGN="top" HEIGHT="21" align="right"><font face="Arial" size="1"></font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="TOP" HEIGHT="21"><font SIZE="2" face="Arial">Long-term debt</font></td>
    <td WIDTH="12" VALIGN="TOP" HEIGHT="21"></td>
    <td WIDTH="94" VALIGN="TOP" HEIGHT="21" align="right"><font size="2" face="Arial">4,632
      &nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="15" VALIGN="TOP" HEIGHT="21"></td>
    <td WIDTH="97" VALIGN="TOP" HEIGHT="21" align="right"><font SIZE="2" face="Arial">4,632
    &nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="TOP" HEIGHT="21"><font SIZE="2" face="Arial">Future pension and
    postretirement benefit obligations</font></td>
    <td WIDTH="12" VALIGN="TOP" HEIGHT="21"></td>
    <td WIDTH="94" VALIGN="TOP" HEIGHT="21" align="right"><font SIZE="2" face="Arial">5,086
    &nbsp;&nbsp;&nbsp; </font></td>
    <td WIDTH="15" VALIGN="TOP" HEIGHT="21"></td>
    <td WIDTH="97" VALIGN="TOP" HEIGHT="21" align="right"><font SIZE="2" face="Arial">5,088
    &nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="TOP" HEIGHT="21"><font SIZE="2" face="Arial">Other long-term
    liabilities</font></td>
    <td WIDTH="12" VALIGN="TOP" HEIGHT="21"></td>
    <td WIDTH="94" VALIGN="TOP" HEIGHT="21" align="right"><font SIZE="2" face="Arial">2,059
    &nbsp;&nbsp;&nbsp; </font></td>
    <td WIDTH="15" VALIGN="TOP" HEIGHT="21"></td>
    <td WIDTH="97" VALIGN="TOP" HEIGHT="21" align="right"><font SIZE="2" face="Arial">2,095
    &nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="top" HEIGHT="21"><font face="Arial" size="2">Minority
      interest in subsidiary companies</font></td>
    <td WIDTH="12" VALIGN="top" HEIGHT="21"></td>
    <td WIDTH="94" VALIGN="TOP" HEIGHT="21" align="right"><font SIZE="2" face="Arial">&nbsp;&nbsp;
      &nbsp;&nbsp;
    &nbsp; 594&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
    <td WIDTH="15" VALIGN="top" HEIGHT="21"></td>
    <td WIDTH="97" VALIGN="top" HEIGHT="21" align="right"><font face="Arial" size="2">589
    &nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="top" HEIGHT="21"><font face="Arial" size="1">&nbsp; </font></td>
    <td WIDTH="12" VALIGN="top" HEIGHT="21"><font face="Arial" size="1"></font></td>
    <td WIDTH="94" VALIGN="top" HEIGHT="21" align="right"></td>
    <td WIDTH="15" VALIGN="top" HEIGHT="21"></td>
    <td WIDTH="97" VALIGN="top" HEIGHT="21" align="right"><font face="Arial" size="1"></font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="TOP" HEIGHT="22"><font SIZE="2" face="Arial">Series A ESOP
    Convertible Preferred Stock</font></td>
    <td WIDTH="12" VALIGN="TOP" HEIGHT="22"></td>
    <td WIDTH="94" VALIGN="TOP" HEIGHT="22" align="right"><font SIZE="2" face="Arial">714
    &nbsp;&nbsp;&nbsp; </font></td>
    <td WIDTH="15" VALIGN="TOP" HEIGHT="22"></td>
    <td WIDTH="97" VALIGN="TOP" HEIGHT="22" align="right"><font SIZE="2" face="Arial">718
    &nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="TOP"><font SIZE="2" face="Arial">ESOP deferred
    compensation</font></td>
    <td WIDTH="12" VALIGN="TOP"></td>
    <td WIDTH="94" VALIGN="TOP" align="right"><font SIZE="2" face="Arial">&nbsp;
    &nbsp; (288)&nbsp; &nbsp; </font></td>
    <td WIDTH="15" VALIGN="TOP"></td>
    <td WIDTH="97" VALIGN="TOP" align="right"><font SIZE="2" face="Arial">&nbsp;
    &nbsp; (290)&nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="TOP"><font SIZE="2" face="Arial">&nbsp; </font></td>
    <td WIDTH="12" VALIGN="TOP"></td>
    <td WIDTH="96" VALIGN="top" align="right" style="border-top-style: solid; border-top-width: thin; border-bottom-style: solid; border-bottom-width: thin"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;
      426&nbsp;&nbsp; &nbsp; </font></td>
    <td WIDTH="15" VALIGN="TOP"></td>
    <td WIDTH="99" VALIGN="top" align="right" style="border-top-style: solid; border-top-width: thin; border-bottom-style: solid; border-bottom-width: thin"><font SIZE="2" face="Arial">&nbsp;
    &nbsp;&nbsp; 428&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="TOP"><font SIZE="2" face="Arial">Shareowners' Equity:</font></td>
    <td WIDTH="12" VALIGN="TOP"></td>
    <td WIDTH="94" VALIGN="TOP"></td>
    <td WIDTH="15" VALIGN="TOP"></td>
    <td WIDTH="97" VALIGN="TOP"></td>
  </tr>

  </center>
  <tr>
    <td WIDTH="306" VALIGN="TOP">
      <p align="left"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;
    Common Stock</font></p>
    </td>
  <center>

    <td WIDTH="12" VALIGN="TOP"></td>
    <td WIDTH="94" VALIGN="TOP" align="right"><font SIZE="2" face="Arial">5,512
    &nbsp;&nbsp;&nbsp; </font></td>
    <td WIDTH="15" VALIGN="TOP" align="right"></td>
    <td WIDTH="97" VALIGN="TOP" align="right"><font SIZE="2" face="Arial">5,447
    &nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="TOP"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;
    Treasury Stock</font></td>
    <td WIDTH="12" VALIGN="TOP"></td>
    <td WIDTH="94" VALIGN="TOP" align="right"><font SIZE="2" face="Arial">(5,151)
    &nbsp;&nbsp; </font></td>
    <td WIDTH="15" VALIGN="TOP" align="right"></td>
    <td WIDTH="97" VALIGN="TOP" align="right"><font SIZE="2" face="Arial">(4,951)
    &nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="top"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;
    Retained earnings</font></td>
    <td WIDTH="12" VALIGN="top"></td>

  </center>
    <td WIDTH="94" VALIGN="top" align="right">
      <p align="right"><font SIZE="2" face="Arial">11,192
    &nbsp;&nbsp;&nbsp; </font></p>
    </td>
  <center>

    <td WIDTH="15" VALIGN="top" align="right"></td>

  </center>
    <td WIDTH="97" VALIGN="top" align="right">
      <p align="right"><font SIZE="2" face="Arial">10,836 &nbsp;&nbsp;&nbsp; </font></p>
    </td>
  </tr>
  <center>

  <tr>
    <td WIDTH="306" VALIGN="TOP"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;
    Accumulated other non-shareowners' changes<br>
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp; in equity</font></td>
    <td WIDTH="12" VALIGN="TOP"></td>
    <td WIDTH="94" VALIGN="TOP" align="right"><font SIZE="2" face="Arial"><br>
    &nbsp;&nbsp; (2,873)&nbsp; &nbsp; </font></td>
    <td WIDTH="15" VALIGN="TOP" align="right"></td>
    <td WIDTH="97" VALIGN="TOP" align="right"><font SIZE="2" face="Arial"><br>
    &nbsp;&nbsp; (2,977)&nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="top"></td>
    <td WIDTH="12" VALIGN="top"></td>
    <td WIDTH="96" VALIGN="top" align="right" style="border-top-style: solid; border-top-width: thin; border-bottom-style: solid; border-bottom-width: thin"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;
      8,680&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
    <td WIDTH="15" VALIGN="top" align="right"></td>
    <td WIDTH="99" VALIGN="top" align="right" style="border-top-style: solid; border-top-width: thin; border-bottom-style: solid; border-bottom-width: thin"><font SIZE="2" face="Arial">&nbsp;&nbsp;
      8,355&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="306" VALIGN="top"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    Total Liabilities and Shareowners' Equity</font></td>
    <td WIDTH="12" VALIGN="top"><p ALIGN="RIGHT"><font SIZE="2" face="Arial">$</font></td>
    <td WIDTH="96" VALIGN="top" align="right" style="border-bottom-style: double; border-bottom-width: thick"><font
    SIZE="2" face="Arial">29,719 &nbsp; &nbsp; </font></td>
    <td WIDTH="15" VALIGN="top" align="right"><p ALIGN="RIGHT"><font SIZE="2" face="Arial">$</font></td>
    <td WIDTH="99" VALIGN="top" align="right" style="border-bottom-style: double; border-bottom-width: thick"><font
    SIZE="2" face="Arial">29,174 &nbsp;&nbsp;&nbsp; </font></td>
  </tr>
</table>

  </center>
</div>

<p><font SIZE="2" face="Arial">See accompanying Notes to Condensed Consolidated Financial
Statements</font></p>

<p align="center"><font size="2" face="Arial">3</font></p>

<hr>
<b><font FACE="Arial" SIZE="3">

<p align="center"></font><font SIZE="2" face="Arial">UNITED TECHNOLOGIES CORPORATION<br>
AND SUBSIDIARIES</font></p>

<p ALIGN="CENTER"><font SIZE="2" face="Arial"><u>CONDENSED CONSOLIDATED STATEMENT OF CASH
FLOWS<br>
</u>(Unaudited)</font></p>
</b>

<div align="center">
  <center>

<table CELLSPACING="0" BORDER="0" width="589">
  <tr>
    <td width="367" height="21"><font SIZE="2" face="Arial">In Millions</font></td>
    <td width="24" height="21"></td>
    <td colspan="3" align="center" class="botbord" width="186" height="21"><font SIZE="2" face="Arial"><strong>Quarter
    Ended March 31,</strong></font></td>
  </tr>
  <tr>
    <td width="367" height="21"></td>
    <td width="24" height="21"></td>
    <td align="center" class="botbord" width="80" height="21"><font size="2" face="Arial"><strong><u>2003</u></strong></font></td>
    <td align="center" width="17" height="21"></td>
    <td align="center" class="botbord" width="81" height="21"><font size="2" face="Arial"><strong><u>2002</u></strong></font></td>
  </tr>
  <tr>
    <td width="367" height="21"><font SIZE="2" face="Arial">Operating Activities:</font></td>
    <td width="24" height="21"></td>
    <td align="right" width="80" height="21"></td>
    <td width="17" height="21"></td>
    <td align="right" width="81" height="21"></td>
  </tr>
  <tr>
    <td width="367" height="18"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp; Net income</font></td>
    <td width="24" height="18"><p ALIGN="RIGHT"><font SIZE="2" face="Arial">$</font></td>
    <td align="right" width="80" height="18"><font SIZE="2" face="Arial">502 &nbsp;&nbsp;&nbsp; </font></td>
    <td width="17" height="18"><p ALIGN="RIGHT"><font SIZE="2" face="Arial">$</font></td>
    <td align="right" width="81" height="18"><font size="2" face="Arial">467 &nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td width="367" height="34"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Adjustments to reconcile
    net income to net<br>
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; cash flows provided by operating activities:</font></td>
    <td width="24" height="34"></td>
    <td align="right" width="80" height="34"><font SIZE="2" face="Arial"><br>
    </font></td>
    <td width="17" height="34"></td>
    <td align="right" width="81" height="34"></td>
  </tr>
  <tr>
    <td width="367" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      Depreciation
    and amortization</font></td>
    <td width="24" height="21"></td>
    <td align="right" width="80" height="21"><font SIZE="2" face="Arial">180 &nbsp;&nbsp;&nbsp; </font></td>
    <td width="17" height="21"></td>
    <td align="right" width="81" height="21"><font size="2" face="Arial">175 &nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td width="367" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      Deferred income
    tax provision </font></td>
    <td width="24" height="21"></td>
    <td align="right" width="80" height="21"><font SIZE="2" face="Arial">104 &nbsp;&nbsp;&nbsp; </font></td>
    <td width="17" height="21"></td>
    <td align="right" width="81" height="21"><font SIZE="2" face="Arial">73 &nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td width="367" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Change in:</font></td>
    <td width="24" height="21"></td>
    <td align="right" width="80" height="21"></td>
    <td width="17" height="21"></td>
    <td align="right" width="81" height="21"></td>
  </tr>
  <tr>
    <td width="367" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      Accounts receivable</font></td>
    <td width="24" height="21"></td>
    <td align="right" width="80" height="21"><font SIZE="2" face="Arial">(51) &nbsp;&nbsp; </font></td>
    <td width="17" height="21"></td>
    <td align="right" width="81" height="21"><font SIZE="2" face="Arial">(171) &nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td width="367" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      Inventories and
    contracts in progress</font></td>
    <td width="24" height="21"></td>
    <td align="right" width="80" height="21"><font SIZE="2" face="Arial">(104) &nbsp;&nbsp; </font></td>
    <td width="17" height="21"></td>
    <td align="right" width="81" height="21"><font SIZE="2" face="Arial">(153) &nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td width="367" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      Accounts payable and
    accrued liabilities </font></td>
    <td width="24" height="21"></td>
    <td align="right" width="80" height="21"><font SIZE="2" face="Arial">128 &nbsp;&nbsp;&nbsp; </font></td>
    <td width="17" height="21"></td>
    <td align="right" width="81" height="21"><font size="2" face="Arial">180&nbsp; &nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td width="367" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      Other current assets</font></td>
    <td width="24" height="21"></td>
    <td align="right" width="80" height="21"><font SIZE="2" face="Arial">(57) &nbsp;&nbsp; </font></td>
    <td width="17" height="21"></td>
    <td align="right" width="81" height="21"><font size="2" face="Arial">(49) &nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td width="367" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      Contributions to domestic pension plans</font></td>
    <td width="24" height="21"></td>
    <td align="right" width="80" height="21"><font SIZE="2" face="Arial">(500)&nbsp;&nbsp;&nbsp;</font></td>
    <td width="17" height="21"></td>
    <td align="right" width="81" height="21"><font size="2" face="Arial">- &nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td width="367" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      Other, net</font></td>
    <td width="24" height="21"></td>
    <td align="right" width="80" height="21"><font SIZE="2" face="Arial">&nbsp; &nbsp; &nbsp;&nbsp; &nbsp; 50&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
    <td width="17" height="21"></td>
    <td align="right" width="81" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp; &nbsp;&nbsp;&nbsp;
      79&nbsp; &nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td width="367" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      Net cash flows
    provided by operating activities</font></td>
    <td width="24" height="21"></td>
    <td align="right" style="border-top-style: solid; border-top-width: thin; border-bottom-style: solid; border-bottom-width: thin" width="82" height="21"><font SIZE="2"
    face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 252&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
    <td width="17" height="21"></td>
    <td align="right" style="border-top-style: solid; border-top-width: thin; border-bottom-style: solid; border-bottom-width: thin" width="83" height="21"><font SIZE="2"
    face="Arial">&nbsp;&nbsp;&nbsp;&nbsp; 601&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td width="367" height="21"><font face="Arial" size="1">&nbsp; </font></td>
    <td width="24" height="21"><font face="Arial" size="1"></font></td>
    <td align="right" width="80" height="21"><font face="Arial" size="1"></font></td>
    <td width="17" height="21"><font face="Arial" size="1"></font></td>
    <td align="right" width="81" height="21"><font face="Arial" size="1"></font></td>
  </tr>
  <tr>
    <td width="367" height="21"><font SIZE="2" face="Arial">Investing Activities:</font></td>
    <td width="24" height="21"></td>
    <td align="right" width="80" height="21"></td>
    <td width="17" height="21"></td>
    <td align="right" width="81" height="21"></td>
  </tr>
  <tr>
    <td width="367" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp; Capital expenditures</font></td>
    <td width="24" height="21"></td>
    <td align="right" width="80" height="21"><font SIZE="2" face="Arial">(87) &nbsp;&nbsp; </font></td>
    <td width="17" height="21"></td>
    <td align="right" width="81" height="21"><font SIZE="2" face="Arial">(156) &nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td width="367" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp; Investments in businesses</font></td>
    <td width="24" height="21"></td>
    <td align="right" width="80" height="21"><font SIZE="2" face="Arial">(18)
      &nbsp;&nbsp; </font></td>
    <td width="17" height="21"></td>
    <td align="right" width="81" height="21"><font SIZE="2" face="Arial">(118) &nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td width="367" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp; (Increase)
      decrease in customer financing assets,
    net</font></td>
    <td width="24" height="21"></td>
    <td align="right" width="80" height="21"><font SIZE="2" face="Arial">(9)
      &nbsp;&nbsp; </font></td>
    <td width="17" height="21"></td>
    <td align="right" width="81" height="21"><font size="2" face="Arial">1 &nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td width="367" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp; Other, net</font></td>
    <td width="24" height="21"></td>
    <td align="right" width="80" height="21"><font SIZE="2" face="Arial">&nbsp; &nbsp; &nbsp;&nbsp; &nbsp;
      6&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
    <td width="17" height="21"></td>
    <td align="right" width="81" height="21"><font SIZE="2" face="Arial">&nbsp; &nbsp;&nbsp;&nbsp;5
      &nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td width="367" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Net cash flows used in
    investing activities</font></td>
    <td width="24" height="21"></td>
    <td align="right" style="border-top-style: solid; border-top-width: thin; border-bottom-style: solid; border-bottom-width: thin" width="82" height="21"><font SIZE="2"
    face="Arial">&nbsp;&nbsp;&nbsp;&nbsp; (108)&nbsp;&nbsp;&nbsp; </font></td>
    <td width="17" height="21"></td>
    <td align="right" style="border-top-style: solid; border-top-width: thin; border-bottom-style: solid; border-bottom-width: thin" width="83" height="21"><font SIZE="2"
    face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (268)&nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td width="367" height="21"><font face="Arial" size="1">&nbsp; </font></td>
    <td width="24" height="21"><font face="Arial" size="1"></font></td>
    <td align="right" width="80" height="21"><font face="Arial" size="1"></font></td>
    <td width="17" height="21"><font face="Arial" size="1"></font></td>
    <td align="right" width="81" height="21"><font face="Arial" size="1"></font></td>
  </tr>
  <tr>
    <td width="367" height="21"><font SIZE="2" face="Arial">Financing Activities:</font></td>
    <td width="24" height="21"></td>
    <td align="right" width="80" height="21"></td>
    <td width="17" height="21"></td>
    <td align="right" width="81" height="21"></td>
  </tr>
  <tr>
    <td width="367" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp; Repayment of long-term debt</font></td>
    <td width="24" height="21"></td>
    <td align="right" width="80" height="21"><font SIZE="2" face="Arial">(2) &nbsp;&nbsp; </font></td>
    <td width="17" height="21"></td>
    <td align="right" width="81" height="21"><font SIZE="2" face="Arial">(185) &nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td width="367" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;
      Increase (decrease) in short-term borrowings, net</font></td>
    <td WIDTH="24" height="21"></td>
    <td WIDTH="80" align="right" height="21"><font SIZE="2" face="Arial">&nbsp; &nbsp; &nbsp;&nbsp; &nbsp;
      17&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
    <td WIDTH="17" height="21"></td>
    <td WIDTH="81" align="right" height="21"><font SIZE="2" face="Arial">(139)&nbsp;&nbsp;&nbsp;
    </font></td>
  </tr>
  <tr>
    <td width="367" height="21"><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;
      Common Stock issued under employee stock plans</font></td>
    <td WIDTH="24" height="21"></td>
    <td WIDTH="80" align="right" height="21"><font face="Arial" size="2">43&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="17" height="21"></td>
    <td WIDTH="81" align="right" height="21"><font face="Arial" size="2">79&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td width="367" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp; Dividends paid
    on Common Stock</font></td>
    <td WIDTH="24" height="21"></td>
    <td WIDTH="80" align="right" height="21"><font SIZE="2" face="Arial">(115) &nbsp;&nbsp; </font></td>
    <td WIDTH="17" height="21"></td>
    <td WIDTH="81" align="right" height="21"><font SIZE="2" face="Arial">(116) &nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td width="367" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp; Repurchase of
    Common Stock</font></td>
    <td WIDTH="24" height="21"></td>
    <td WIDTH="80" align="right" height="21"><font SIZE="2" face="Arial">(201) &nbsp;&nbsp; </font></td>
    <td WIDTH="17" height="21"></td>
    <td WIDTH="81" align="right" height="21"><font SIZE="2" face="Arial">(100) &nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td width="367" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp; Other, net</font></td>
    <td WIDTH="24" height="21"></td>
    <td WIDTH="80" align="right" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      (65)&nbsp;&nbsp;&nbsp; </font></td>
    <td WIDTH="17" height="21"></td>
    <td WIDTH="81" align="right" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      (79) &nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td width="367" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      Net
    cash flows used in financing activities</font></td>
    <td WIDTH="24" height="21"></td>
    <td WIDTH="82" align="right" height="21" style="border-top-style: solid; border-top-width: thin; border-bottom-style: solid; border-bottom-width: thin"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      (323)&nbsp;&nbsp;&nbsp; </font></td>
    <td WIDTH="17" height="21"></td>
    <td WIDTH="83" align="right" height="21" style="border-top-style: solid; border-top-width: thin; border-bottom-style: solid; border-bottom-width: thin"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;
      &nbsp; (540)&nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td width="367" height="16"><font face="Arial" size="1">&nbsp; </font></td>
    <td WIDTH="24" height="16"><font size="1">&nbsp;&nbsp;</font></td>

  </center>
    <td WIDTH="80" align="right" height="16">
      <p align="left"><font size="1">&nbsp;&nbsp;</font></td>
  <center>

    <td WIDTH="17" height="16"><font size="1">&nbsp;&nbsp;</font></td>

  </center>
    <td WIDTH="81" align="right" height="16">
      <p align="left"><font size="1">&nbsp;&nbsp;</font></td>
  </tr>
  <center>

  <tr>
    <td width="367" height="36"><font SIZE="2" face="Arial">Effect of foreign exchange rate
    changes on Cash<br>
      &nbsp;&nbsp; and cash equivalents</font></td>
    <td WIDTH="24" height="36"></td>
    <td WIDTH="82" align="right" height="36" valign="bottom" style="border-bottom-style: solid; border-bottom-width: thin"><font SIZE="2" face="Arial">&nbsp; &nbsp; &nbsp;&nbsp; &nbsp;
      26&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
    <td WIDTH="17" height="36"></td>
    <td WIDTH="83" align="right" height="36" style="border-bottom-style: solid; border-bottom-width: thin" valign="bottom"><font SIZE="2"
    face="Arial"><br>
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (14)&nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td width="367" height="16"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
    <td WIDTH="24" height="16"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
    <td WIDTH="80" align="left" height="16"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
    <td WIDTH="17" height="16"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
    <td WIDTH="81" align="left" height="16"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td width="367" height="21"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp; Net
      decrease in Cash and cash equivalents</font></td>
    <td WIDTH="24" height="21"></td>

  </center>
    <td WIDTH="80" height="21">
      <p align="right"><font SIZE="2" face="Arial">
      (153)&nbsp; &nbsp; </font></p>
  </td>
  <center>

    <td WIDTH="17" height="21"></td>

  </center>
    <td WIDTH="81" height="21">
      <p align="right"><font SIZE="2" face="Arial">
      (221) &nbsp;&nbsp;</font></p>
  </td>
  </tr>
  <center>

  <tr>
    <td width="367" height="5"><font SIZE="2" face="Arial">Cash and cash equivalents,
    beginning of year</font></td>
    <td WIDTH="24" height="5"></td>
    <td WIDTH="80" align="right" height="5" class="botbord"><font SIZE="2" face="Arial">&nbsp;&nbsp; &nbsp;&nbsp; &nbsp;2,080&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="17" height="5"></td>
    <td WIDTH="81" align="right" height="5" class="botbord"><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      1,558&nbsp; &nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td width="367" height="26"><font SIZE="2" face="Arial">Cash and cash equivalents, end of
    period</font></td>
    <td WIDTH="24" height="26"><p ALIGN="RIGHT"><font SIZE="2" face="Arial">$</font></td>
    <td WIDTH="82" align="right" height="26" class="double" style="border-top-style: solid; border-top-width: thin; border-bottom-style: double; border-bottom-width: thick"><font SIZE="2" face="Arial">1,927&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="17" height="26"><p align="right"><font SIZE="2" face="Arial">$</font></td>
    <td WIDTH="83" align="right" height="26" class="double" style="border-top-style: solid; border-top-width: thin; border-bottom-style: double; border-bottom-width: thick"><font size="2" face="Arial">1,337&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>
</table>

  </center>
</div>

<p><font SIZE="2" face="Arial">See accompanying Notes to Condensed Consolidated Financial
Statements</font></p>

<p align="center"><font size="2" face="Arial">4</font></p>

<hr>

<p align="center"><b><font SIZE="2" face="Arial">UNITED TECHNOLOGIES CORPORATION<br>
AND SUBSIDIARIES</font></p>

<p align="center"><font SIZE="2" face="Arial"><u>NOTES TO CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS<br>
</u>(Unaudited)</font></p>
</b>

<p ALIGN="JUSTIFY"><font FACE="Arial" SIZE="2">&nbsp;&nbsp;&nbsp; The Condensed
Consolidated Financial Statements at March 31, 2003 and for the quarters ended
March 31, 2003 and 2002 are unaudited, but in the opinion of management include
all adjustments, consisting only of normal recurring adjustments, necessary for
a fair presentation of the results for the interim periods. The results reported
in these Condensed Consolidated Financial Statements should not necessarily be
taken as indicative of results that may be expected for the entire year. The
financial information included herein should be read in conjunction with the
financial statements and notes in the Corporation's Annual Report incorporated
by reference in Form 10-K for calendar year 2002. Certain reclassifications have
been made to the prior year amounts to conform to the current year presentation.</font></p>

<b>
<p ALIGN="JUSTIFY"><font FACE="Arial" size="2">Employee Benefit Plans</font></b></p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;<font face="Arial" size="3"> </font><font FACE="Arial" size="2">During
the first quarter of 2003, the Corporation made a $500 million cash contribution
to its defined benefit domestic pension plans.</font></p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;<font face="Arial" size="2"> The
Corporation has long-term incentive plans authorizing various types of market
and performance based incentive awards that may be granted to officers and
employees. The Corporation applies APB Opinion 25, "Accounting for Stock
Issued to Employees," and related interpretations in accounting for its
long-term incentive plans. The exercise price of stock options, set at the time
of the grant, is not less than the fair market value per share at the date of
grant. Options have a term of ten years and generally vest after three years.</font></p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;<font face="Arial" size="2"> The following
table illustrates the effect on net income and earnings per share as if the
Black-Scholes fair value method described in Statement of Financial Accounting
Standards (&quot;SFAS&quot;) No. 123, "Accounting for
Stock-Based Compensation," as amended, had been applied to the
Corporation's long-term incentive plans.</font></p>
<font FACE="Arial" SIZE="3"></font>

<div align="center">
  <center>

<table CELLSPACING="0" BORDER="0" width="600" height="418">
  <tr>
    <td width="40" height="16"><font face="Arial" size="2">&nbsp;</font></td>
    <td WIDTH="270" VALIGN="TOP" height="16"><font face="Arial" size="2">&nbsp;&nbsp;</font></td>
  </center>
    <td WIDTH="198" VALIGN="TOP" colspan="4">
      <p align="center"><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      <b>Quarter Ended<br>
      &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; March 31,</b></font></td>
</tr>
  <center>

<tr>
    <td width="310" height="16" colspan="2"><font face="Arial" size="2">In Millions,<br>
      except per share amounts&nbsp;&nbsp;</font></td>
    <td WIDTH="16" VALIGN="TOP" align="center" height="16"><font face="Arial" size="2">&nbsp;&nbsp;</font></td>
    <td WIDTH="82" VALIGN="bottom" align="left" height="16">
      <p align="center"><font face="Arial" size="2"><b><u>2003</u></b></font></p>
  </td>
    <td WIDTH="14" VALIGN="TOP" align="left" height="16"><font face="Arial" size="2">&nbsp;&nbsp;</font></td>
    <td WIDTH="86" VALIGN="bottom" align="left" height="16">
      <p align="center"><font face="Arial" size="2"><b><u>2002</u></b></font></td>
</tr>
  <tr>
    <td width="40" height="16"><font face="Arial" size="1">&nbsp;</font></td>
    <td WIDTH="270" VALIGN="TOP" height="16"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
    <td WIDTH="16" VALIGN="TOP" align="center" height="16"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
    <td WIDTH="82" VALIGN="TOP" align="left" height="16"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
    <td WIDTH="14" VALIGN="TOP" align="left" height="16"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
    <td WIDTH="86" VALIGN="TOP" align="left" height="16"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td width="310" colspan="2" height="18"><font SIZE="2" face="Arial">Net income
      as reported</font></td>
    <td WIDTH="16" VALIGN="TOP" align="right" height="18"><p ALIGN="RIGHT"><font SIZE="2" face="Arial">$</font></td>
    <td WIDTH="82" VALIGN="TOP" align="right" height="18"><font size="2" face="Arial">502
      &nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="14" VALIGN="TOP" align="right" height="18"><p ALIGN="right"><font SIZE="2" face="Arial">$</font></td>
    <td WIDTH="86" VALIGN="TOP" align="right" height="18"><font size="2" face="Arial">467
    &nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td width="40" valign="TOP" height="50"><font size="2" face="Arial">Add:</font></td>
    <td WIDTH="270" VALIGN="TOP" height="50"><font size="2" face="Arial">Stock-based
      employee compensation expense included in net
      income, net&nbsp;<br>
 of related tax effects</font></td>
    <td WIDTH="16" VALIGN="TOP" align="right" height="50"></td>
    <td WIDTH="82" VALIGN="bottom" align="right" height="50"><br>
      -<font size="2" face="Arial">
    &nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="14" VALIGN="TOP" align="right" height="50"></td>
    <td WIDTH="86" VALIGN="bottom" align="right" height="50"><font size="2" face="Arial"><br>
      2 &nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td width="40" valign="TOP" height="66"><font size="2" face="Arial">Less:</font></td>
    <td WIDTH="270" VALIGN="TOP" height="66"><font size="2" face="Arial">Total
      stock-based employee compensation<br>
      expense determined under Black-Scholes<br>
      option pricing model, net of related tax<br>
      effects</font></td>
    <td WIDTH="16" VALIGN="TOP" align="right" height="66"></td>
    <td WIDTH="82" VALIGN="bottom" align="right" height="66" style="border-bottom-style: solid; border-bottom-width: thin"><font size="2" face="Arial">(32)
    &nbsp;&nbsp;</font></td>
    <td WIDTH="14" VALIGN="TOP" align="right" height="66"></td>
    <td WIDTH="86" VALIGN="bottom" align="right" style="border-bottom-style: solid; border-bottom-width: thin" height="66"><font size="2" face="Arial">(32)
    &nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td width="40" height="16"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
    <td WIDTH="270" VALIGN="TOP" height="16"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
    <td WIDTH="16" VALIGN="TOP" align="right" height="16"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
    <td WIDTH="82" VALIGN="TOP" align="right" height="16"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
    <td WIDTH="14" VALIGN="TOP" align="right" height="16"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
    <td WIDTH="86" VALIGN="TOP" align="right" height="16"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td width="310" colspan="2" height="25"><font face="Arial" size="2">Proforma
      net income</font></td>
    <td WIDTH="16" VALIGN="TOP" align="right" height="25"><font face="Arial" size="2">$</font></td>
    <td WIDTH="82" VALIGN="TOP" align="right" style="border-bottom-style: double; border-bottom-width: thick" height="25"><font size="2" face="Arial">470
      &nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="14" VALIGN="TOP" align="right" height="25"><font face="Arial" size="2">$</font></td>
    <td WIDTH="86" VALIGN="TOP" align="right" style="border-bottom-style: double; border-bottom-width: thick" height="25"><font face="Arial" size="2">437
    &nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td width="40" height="16"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
    <td WIDTH="270" VALIGN="TOP" height="16"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
    <td WIDTH="16" VALIGN="TOP" align="center" height="16"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
    <td WIDTH="82" VALIGN="TOP" align="right" height="16"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
    <td WIDTH="14" VALIGN="TOP" align="center" height="16"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
    <td WIDTH="86" VALIGN="TOP" align="right" height="16"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td width="310" colspan="2" height="21"><font face="Arial" size="2">Earnings
      per share:</font></td>
    <td WIDTH="16" VALIGN="TOP" align="right" height="21"></td>
    <td WIDTH="82" VALIGN="TOP" align="right" height="21"></td>
    <td WIDTH="14" VALIGN="TOP" align="right" height="21"></td>
    <td WIDTH="86" VALIGN="TOP" align="right" height="21"></td>
  </tr>
  <tr>
    <td width="40" height="21"></td>
    <td WIDTH="270" VALIGN="TOP" height="21"><font face="Arial" size="2">Basic -
      as reported</font></td>
    <td WIDTH="16" VALIGN="TOP" align="right" height="21"><font size="2">$</font></td>
    <td WIDTH="82" VALIGN="TOP" align="right" height="21"><font size="2" face="Arial">1.05
    &nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="14" VALIGN="TOP" align="right" height="21"><font size="2">$</font></td>
    <td WIDTH="86" VALIGN="TOP" align="right" height="21"><font size="2" face="Arial">.97
    &nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td width="40" height="21"></td>
    <td WIDTH="270" VALIGN="TOP" height="21"><font face="Arial" size="2">Basic -
      pro forma</font></td>
    <td WIDTH="16" VALIGN="TOP" align="right" height="21"><font size="2">$</font></td>
    <td WIDTH="82" VALIGN="TOP" align="right" height="21"><font size="2" face="Arial">1.00
      &nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="14" VALIGN="TOP" align="right" height="21"><font size="2">$</font></td>
    <td WIDTH="86" VALIGN="TOP" align="right" height="21"><font face="Arial"><font size="2">.92&nbsp;&nbsp;&nbsp;&nbsp;</font></font></td>
  </tr>
  <tr>
    <td width="40" height="6"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
    <td WIDTH="270" VALIGN="TOP" height="6"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
  </center>
    <td WIDTH="16" VALIGN="TOP" align="right" height="6">
      <p align="left"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
  <center>

    <td WIDTH="82" VALIGN="TOP" align="right" height="6"><font size="1" face="Arial">&nbsp;</font></td>
  </center>
    <td WIDTH="14" VALIGN="TOP" align="right" height="6">
      <p align="left"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
  <center>

    <td WIDTH="86" VALIGN="TOP" align="right" height="6"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td width="40" height="21"></td>
    <td WIDTH="270" VALIGN="TOP" height="21"><font face="Arial" size="2">Diluted
      - as reported</font></td>
    <td WIDTH="16" VALIGN="TOP" align="right" height="21"><font size="2">$</font></td>
    <td WIDTH="82" VALIGN="TOP" align="right" height="21"><font size="2" face="Arial">1.00
    &nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="14" VALIGN="TOP" align="right" height="21"><font size="2">$</font></td>
    <td WIDTH="86" VALIGN="TOP" align="right" height="21"><font size="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;.92
    &nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td width="40" valign="middle" height="21"></td>
    <td WIDTH="270" VALIGN="middle" height="21"><font face="Arial" size="2">Diluted
      - pro forma</font></td>
    <td WIDTH="16" VALIGN="middle" align="center" height="21"><p ALIGN="RIGHT"><font face="Arial" size="2">$</font></td>
    <td WIDTH="82" VALIGN="middle" align="right" height="21"><font size="2" face="Arial">.94
    &nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="14" VALIGN="middle" align="right" height="21"><p ALIGN="RIGHT"><font face="Arial" size="2">$</font></td>
    <td WIDTH="86" VALIGN="middle" align="right" height="21"><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;
      .86
    &nbsp;&nbsp;&nbsp;</font></td>
  </tr>
</table>
  </center>
</div>

<p ALIGN="center"><font face="Arial" size="2">5</font></p>

<hr>

<p ALIGN="center">

<font face="Arial" size="2">
<b>

UNITED TECHNOLOGIES CORPORATION<br>
AND SUBSIDIARIES
</b>
</font>

</p>

<p ALIGN="left"><font face="Arial" size="2"><b>Derivative Instruments and
Hedging Activities</b></font></p>

<p ALIGN="JUSTIFY"><font FACE="Arial" size="2">&nbsp;&nbsp;&nbsp; The
Corporation uses derivative instruments, including swaps, forward contracts and
options, to manage certain foreign currency, interest rate and commodity price
exposures. Derivative instruments are viewed as risk management tools by the
Corporation and are not used for trading or speculative purposes. Derivatives
used for hedging purposes must be designated and effective as a hedge of the
identified risk exposure at the inception of the contract. Accordingly, changes
in the fair value of the derivative contract must be highly correlated with
changes in the fair value of the underlying hedged item at inception of the
hedge and over the life of the hedge contract.</font></p>
<font FACE="Arial" SIZE="3"></font>
<p ALIGN="JUSTIFY"><font FACE="Arial" size="2">&nbsp;&nbsp;&nbsp; At March 31,
2003 and 2002, the fair value of derivatives held by the Corporation, including
those embedded in other contracts, was a net asset of $82 million and a net
liability of $44 million, respectively. Of the amount recorded in shareowners'
equity, a $29 million pre-tax gain is expected to be reclassified into sales or
cost of products sold to reflect the fixed prices obtained from hedging within
the next 12 months. Gains and losses recognized in earnings related to
discontinuance of cash flow hedges and ineffectiveness of cash flow hedges
during the quarter ended March 31, 2003 were immaterial. All open derivative
contracts mature by December 2005.</font></p>
<font FACE="Arial" SIZE="3"></font><b>
<p ALIGN="JUSTIFY"><font FACE="Arial" size="2">Non-Shareowners' Changes in
Equity</font></b></p>
<p ALIGN="JUSTIFY"><font FACE="Arial" size="2">&nbsp;&nbsp;&nbsp;
Non-shareowners' changes in equity include all changes in equity during a period
except changes resulting from investments by and distributions to shareowners. A
summary of the non-shareowners' changes in equity is provided below.</font></p>

<div align="center">
  <center>

<table CELLSPACING="0" BORDER="0" width="599">
  <tr>
    <td WIDTH="344" VALIGN="bottom"></td>
    <td WIDTH="206" VALIGN="middle" colspan="4" align="center"><font face="Arial" size="2"><b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      Quarter Ended March 31,&nbsp;</b></font></td>
  </tr>
  <tr>
    <td WIDTH="344" VALIGN="bottom"><p ALIGN="JUSTIFY"><font SIZE="2" face="Arial">In
      Millions</font></td>
    <td WIDTH="19" VALIGN="bottom"></td>
    <td WIDTH="84" VALIGN="bottom" align="center" class="medbord"><font face="Arial" size="2"><b><u>2003</u></b></font></td>
    <td WIDTH="20" VALIGN="bottom" align="center"></td>
    <td WIDTH="83" VALIGN="bottom" align="center" class="medbord"><font face="Arial" size="2"><b><u>2002</u></b></font></td>
  </tr>
  <tr>
    <td WIDTH="344" VALIGN="TOP"><p ALIGN="JUSTIFY"><font size="2" face="Arial">Net
      Income</font></td>
    <td WIDTH="19" VALIGN="TOP"><p ALIGN="CENTER"><font SIZE="2" face="Arial">$</font></td>
    <td WIDTH="84" VALIGN="TOP" align="right">
    <p align="right"><font size="2" face="Arial">502&nbsp;&nbsp;&nbsp;
      &nbsp;&nbsp;&nbsp;</font>
    </td>

    <td WIDTH="20" VALIGN="TOP" align="right"><font size="2" face="Arial">$</font></td>

    <td WIDTH="83" VALIGN="TOP" align="right"><p align="right"><font size="2" face="Arial">467&nbsp;&nbsp;&nbsp;
      &nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="344" VALIGN="TOP">
      <p ALIGN="JUSTIFY"><font size="2" face="Arial">Foreign currency
      translation, net</font></td>
    <td WIDTH="19" VALIGN="TOP"></td>
    <td WIDTH="84" VALIGN="TOP" align="right"><p align="right"><font size="2" face="Arial">83&nbsp;&nbsp;&nbsp;
      &nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="20" VALIGN="TOP" align="right"></td>
    <td WIDTH="83" VALIGN="TOP" align="right"><font SIZE="2" face="Arial">(56)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="344" VALIGN="TOP"><p ALIGN="JUSTIFY"><font size="2" face="Arial">Unrealized
      holding loss on<br>
      &nbsp; marketable equity securities, net</font></td>
    <td WIDTH="19" VALIGN="TOP"></td>
    <td WIDTH="84" VALIGN="top" align="right"><font size="2" face="Arial"><br>
      (2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="20" VALIGN="top" align="right"></td>
    <td WIDTH="83" VALIGN="top" align="right"><font size="2" face="Arial"><br>
      &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      (2)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="344" VALIGN="TOP"><font size="2" face="Arial">Cash flow hedging gain, net</font></td>
    <td WIDTH="19" VALIGN="TOP"></td>
    <td WIDTH="84" VALIGN="top" align="right"><font size="2" face="Arial">23&nbsp;&nbsp;&nbsp;
      &nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="20" VALIGN="top" align="right"></td>
    <td WIDTH="83" VALIGN="top" align="right"><font size="2" face="Arial">5 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="344" style="font-family: Arial; font-size: 10pt"><p ALIGN="JUSTIFY"></td>
    <td WIDTH="19" VALIGN="TOP" style="font-family: Arial; font-size: 10pt"><p ALIGN="CENTER"><font SIZE="2" face="Arial">$</font></td>
    <td WIDTH="84" VALIGN="top" align="right" style="border-top-style: solid; border-top-width: thin; border-bottom-style: double; border-bottom-width: thick"><font size="2" face="Arial">606&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="20" VALIGN="top" align="right" style="font-family: Arial; font-size: 10pt"><font size="2" face="Arial">$</font></td>
    <td WIDTH="83" VALIGN="top" align="right" style="border-top-style: solid; border-top-width: thin; border-bottom-style: double; border-bottom-width: thick"><font size="2" face="Arial">414&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>
</table>
  </center>
</div>

<p ALIGN="left"><font face="Arial" size="2"><b>Inventories and Contracts in
Progress</b></font></p>

<div align="center">
  <center>

<table CELLSPACING="0" BORDER="0" width="599">
  <tr>
    <td WIDTH="344" VALIGN="bottom"></td>
    <td WIDTH="206" VALIGN="middle" colspan="4" align="center"><font face="Arial" size="2"><b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</b></font></td>
  </tr>
  <tr>
    <td WIDTH="344" VALIGN="bottom"><p ALIGN="JUSTIFY"><font SIZE="2" face="Arial">In
      Millions</font></td>
    <td WIDTH="19" VALIGN="bottom"></td>
    <td WIDTH="84" VALIGN="bottom" align="center" class="medbord"><font face="Arial" size="2"><b>March
      31,<u><br>
      2003</u></b></font></td>
    <td WIDTH="14" VALIGN="bottom" align="center"></td>
    <td WIDTH="89" VALIGN="bottom" align="center" class="medbord"><font face="Arial" size="2"><b><u>D</u>ecember
      31,<u><br>
      2002</u></b></font></td>
  </tr>
  <tr>
    <td WIDTH="344" VALIGN="TOP"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
    <td WIDTH="19" VALIGN="TOP"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
    <td WIDTH="84" VALIGN="TOP" align="right">
    <font face="Arial" size="1">&nbsp;&nbsp;</font>
    </td>

    <td WIDTH="14" VALIGN="TOP" align="right"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>

    <td WIDTH="89" VALIGN="TOP" align="right"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="344" VALIGN="TOP"><p ALIGN="JUSTIFY"><font SIZE="2" face="Arial">Inventories consist of the following:</font></td>
    <td WIDTH="19" VALIGN="TOP"></td>
    <td WIDTH="84" VALIGN="TOP" align="right">
    </td>

    <td WIDTH="14" VALIGN="TOP" align="right"></td>

    <td WIDTH="89" VALIGN="TOP" align="right"></td>
  </tr>
  <tr>
    <td WIDTH="344" VALIGN="TOP">
      <p ALIGN="JUSTIFY"><font size="2" face="Arial">&nbsp;&nbsp; Raw material</font></td>
  </center>
    <td WIDTH="19" VALIGN="TOP">
      <p align="right"><font face="Arial" size="2">$</font></td>
  <center>

    <td WIDTH="84" VALIGN="TOP" align="right"><font SIZE="2" face="Arial">770&nbsp;&nbsp;
      &nbsp;&nbsp; </font></td>
    <td WIDTH="14" VALIGN="TOP" align="right"><font face="Arial" size="2">$</font></td>
    <td align="right" width="87"><p ALIGN="right"><font SIZE="2" face="Arial">740&nbsp;&nbsp;
      &nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="344" VALIGN="TOP">&nbsp;&nbsp; <font SIZE="2" face="Arial">Work-in-process</font></td>
    <td WIDTH="19" VALIGN="TOP"></td>
    <td WIDTH="84" VALIGN="top" align="right"><font SIZE="2" face="Arial">1,083&nbsp;&nbsp;
      &nbsp;&nbsp;</font></td>
    <td WIDTH="14" VALIGN="top" align="right"></td>
    <td align="right" width="87"><p ALIGN="right"><font SIZE="2" face="Arial">1,026&nbsp;&nbsp;
      &nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="344" VALIGN="TOP"><font SIZE="2" face="Arial">&nbsp;&nbsp; Finished goods</font></td>
    <td WIDTH="19" VALIGN="TOP"></td>
    <td WIDTH="84" VALIGN="top" align="right"><font SIZE="2" face="Arial">2,456&nbsp;&nbsp;
      &nbsp;&nbsp;</font></td>
    <td WIDTH="14" VALIGN="top" align="right"></td>
    <td align="right" width="87"><p ALIGN="right"><font SIZE="2" face="Arial">2,329&nbsp;&nbsp;
      &nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="344" VALIGN="TOP"><font size="2" face="Arial">&nbsp;&nbsp; Contracts in progress</font></td>
    <td WIDTH="19" VALIGN="TOP"></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: thin" width="86"><font SIZE="2" face="Arial">&nbsp;&nbsp;
      2,141&nbsp;&nbsp; &nbsp;&nbsp;</font></td>
    <td WIDTH="14" VALIGN="top" align="right"></td>
    <td align="right" style="border-bottom-style: solid; border-bottom-width: thin" width="89"><font SIZE="2" face="Arial">&nbsp;&nbsp;
      2,177&nbsp;&nbsp; &nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="344" VALIGN="TOP"><font size="2" face="Arial">&nbsp;&nbsp;</font></td>
    <td WIDTH="19" VALIGN="TOP"></td>
    <td align="right" width="84"><font SIZE="2" face="Arial">6,450&nbsp;&nbsp; &nbsp;&nbsp;</font></td>
    <td WIDTH="14" VALIGN="top" align="right"></td>
    <td align="right" width="87"><p ALIGN="right"><font SIZE="2" face="Arial">6,272&nbsp;&nbsp;
      &nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="344" VALIGN="TOP"><font size="2" face="Arial">Less:</font></td>
    <td WIDTH="19" VALIGN="TOP"></td>
    <td WIDTH="84" VALIGN="top" align="right"></td>
    <td WIDTH="14" VALIGN="top" align="right"></td>
    <td WIDTH="89" VALIGN="top" align="right"></td>
  </tr>
  <tr>
    <td WIDTH="344" VALIGN="TOP"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
    <td WIDTH="19" VALIGN="TOP"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
    <td WIDTH="84" VALIGN="top" align="right"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
    <td WIDTH="14" VALIGN="top" align="left"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
    <td WIDTH="89" VALIGN="top" align="left"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="344" VALIGN="TOP"><p ALIGN="JUSTIFY"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp; Progress payments, secured by lien, on <br>
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp; U.S. Government contracts</font></td>
    <td WIDTH="19" VALIGN="TOP"></td>
    <td align="right" width="84"><font SIZE="2" face="Arial"><br>
      (151)&nbsp;&nbsp; &nbsp;</font></td>
    <td WIDTH="14" VALIGN="top" align="right"></td>
    <td align="right" width="87"><p ALIGN="right"><font SIZE="2" face="Arial"><br>
      (123)&nbsp;&nbsp; &nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="344" VALIGN="TOP"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp; Billings on contracts in progress</font></td>
    <td WIDTH="19" VALIGN="TOP"></td>
    <td align="right" width="84"><font SIZE="2" face="Arial">&nbsp;&nbsp;
      (2,336)&nbsp;&nbsp; &nbsp;</font></td>
    <td WIDTH="14" VALIGN="top" align="right"></td>
    <td align="right" width="87"><p ALIGN="right"><font SIZE="2" face="Arial">&nbsp;&nbsp;
      (2,346)&nbsp;&nbsp; &nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="344" style="font-family: Arial; font-size: 10pt"><p ALIGN="JUSTIFY"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;</font></td>
  </center>
    <td WIDTH="19" VALIGN="TOP" style="font-family: Arial; font-size: 10pt"><p ALIGN="right"><font SIZE="2" face="Arial">$</font></td>
  <center>

    <td WIDTH="84" VALIGN="top" align="right" style="border-top-style: solid; border-top-width: thin; border-bottom-style: double; border-bottom-width: thick"><font
    SIZE="2" face="Arial">3,963&nbsp;&nbsp; &nbsp;&nbsp;</font></td>
    <td WIDTH="14" VALIGN="top" align="right" style="font-family: Arial; font-size: 10pt"><font size="2" face="Arial">$</font></td>
    <td WIDTH="89" VALIGN="top" align="right" style="border-top-style: solid; border-top-width: thin; border-bottom-style: double; border-bottom-width: thick"><u><p
    ALIGN="right"></u><font SIZE="2" face="Arial">3,803&nbsp;&nbsp; &nbsp;&nbsp;</font></td>
  </tr>
</table>
  </center>
</div>

<p ALIGN="center"><font face="Arial" size="2">6</font></p>

<hr>

<p align="center"><b><font SIZE="2" face="Arial">UNITED TECHNOLOGIES CORPORATION<br>
AND SUBSIDIARIES</font></b></p>
<p ALIGN="JUSTIFY"><font face="Arial" size="2"><b>Guarantees</b></font></p>
<p ALIGN="JUSTIFY"><font FACE="Arial" size="2">&nbsp;&nbsp;&nbsp; In December
2002, the Corporation adopted Financial Accounting Standards Board
Interpretation (&quot;FIN&quot;) No. 45, "Guarantor's Accounting and Disclosure
Requirements for Guarantees, Including Indirect Guarantees of Indebtedness of
Others.&quot; The Corporation adopted the disclosure
requirements of the Interpretation as of December 31, 2002. Effective January 1,
2003, additional provisions of FIN 45 became effective and were adopted by the
Corporation. The accounting guidelines are applicable to guarantees issued after
December 31, 2002 and require that the Corporation record a liability for the
fair value of such guarantees in the balance sheet.</font></p>
<font FACE="Arial" SIZE="3"></font>
<p ALIGN="JUSTIFY"><font FACE="Arial" size="2">&nbsp;&nbsp;&nbsp; The
Corporation extends a variety of financial, market value and product performance
guarantees to third parties. There have been no material changes to guarantees
outstanding since December 31, 2002.</font></p>
<p ALIGN="JUSTIFY"><font FACE="Arial" size="2">&nbsp;&nbsp;&nbsp; The changes in
the carrying amount of service and product warranties and product performance
guarantees for the quarter ended March 31, 2003, are as follows:</font></p>
<font FACE="Arial" SIZE="3"></font>
<div align="center">
  <center>
  <table border="0" cellspacing="1" width="423">
    <tr>
      <td width="304" height="10"><font face="Arial" size="2">In Millions</font></td>
  </center>
      <td width="14" align="right" height="10">
        <p align="left"></td>
  <center>
      <td width="85" height="10"></td>
    </tr>
    <tr>
      <td width="304" height="18"><font face="Arial" size="2">Balance as of
        January 1, 2003</font></td>
      <td width="14" align="right" height="18"><font face="Arial" size="2">$</font></td>
  </center>
      <td width="85" height="18">
        <p align="right"><font face="Arial" size="2">1,116&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    </tr>
  <center>
    <tr>
      <td width="304" height="21"><font face="Arial" size="2">Warranties and
        guarantees issued</font></td>
  </center>
      <td width="14" align="left" height="21">
        <p align="left"></td>
  <center>
      <td width="85" height="21">
        <p align="right"><font face="Arial" size="2">110&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    </tr>
    <tr>
      <td width="304" height="21"><font face="Arial" size="2">Settlements made</font></td>
      <td width="14" align="left" height="21"></td>
  </center>
      <td width="85" height="21">
        <p align="right"><font face="Arial" size="2">(113)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    </tr>
  <center>
    <tr>
      <td width="304" height="10"><font face="Arial" size="2">Adjustments to
        provision</font></td>
      <td width="14" align="left" height="10"></td>
  </center>
      <td width="85" height="10">
        <p align="right"><font face="Arial" size="2">(6)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    </tr>
  <center>
    <tr>
      <td width="304" height="26"><font face="Arial" size="2">Balance as of
        March 31, 2003</font></td>
      <td width="14" align="right" height="26"><font face="Arial" size="2">$</font></td>
  </center>
      <td width="85" height="26" style="border-top-style: solid; border-top-width: thin; border-bottom-style: double; border-bottom-width: thick">
        <p align="right"><font face="Arial" size="2">1,107&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    </tr>
  </table>
</div>
<p ALIGN="JUSTIFY"><font face="Arial" size="2"><b>Acquisitions, Goodwill and
Other Intangible Assets</b></font></p>
<p ALIGN="JUSTIFY"><font face="Arial" size="2">&nbsp;&nbsp;&nbsp; During the
first quarter of 2003, the Corporation invested $18 million in the acquisition
of businesses. The assets and liabilities of the acquired businesses are
recorded at fair value at the date of acquisition under the purchase method.</font></p>
<p ALIGN="JUSTIFY"><font face="Arial" size="2">&nbsp;&nbsp;&nbsp; The increase
in goodwill of $23 million during the three months ended March 31, 2003 resulted
principally from business combinations completed or finalized in the period.</font></p>
<font FACE="Arial" SIZE="3"></font>
<p ALIGN="JUSTIFY"><font FACE="Arial" size="2">&nbsp;&nbsp;&nbsp; Identifiable
intangible assets are recorded in "Other assets" in the Condensed
Consolidated Balance Sheet and are comprised of:</font></p>

<font FACE="Arial" SIZE="2">
<div align="center">
  <center>
<table border="0" cellpadding="0" cellspacing="0" width="669" style="font-family: Arial; font-size: 10pt">
  <tr>
    <td width="190" colspan="2" valign="bottom"></td>
</font>
    <td width="219" align="center" colspan="4" style="border-bottom-style: groove">

<font FACE="Arial" size="2">
March 31, 2003
</font>
  </td>

<font FACE="Arial" SIZE="2">
    <td width="36" align="center" class="botbord"></td>
    <td width="204" align="center" class="botbord" colspan="4" style="border-bottom-style: groove">December
      31, 2002</td>
  </tr>
  <tr>
    <td width="190" colspan="2" valign="bottom"></td>
    <td width="21" align="right"></td>
    <td width="84" align="center" class="botbord"></td>
    <td width="19" align="center"></td>
    <td width="95" align="center"></td>
    <td width="36" align="center" class="botbord"></td>
    <td width="17" align="center" class="botbord"></td>
    <td width="77" align="center" class="botbord"></td>
    <td width="21" align="center" class="botbord"></td>
    <td width="89" align="center" class="botbord"></td>
  </tr>
  <tr>
    <td width="190" colspan="2" valign="bottom"><font face="Arial" size="2">In
      Millions</font></td>
    <td width="21" align="right"></td>
</font>
    <td width="84" align="center" class="botbord"><font face="Arial" size="2">
      Gross
      <u>
      <br>
      Amount</u></font></td>

<font FACE="Arial" SIZE="2">
    <td width="19" align="center"></td>
</font>
  </center>
    <td width="95" align="center"><font face="Arial" size="2">Accumulated<u>
      <br>
      Amortization</u></font></td>
  <center>

<font FACE="Arial" SIZE="2">
    <td width="36" align="center" class="botbord"></td>
    <td width="17" align="center" class="botbord"></td>
</font>
    <td width="77" align="center" class="botbord">

<font face="Arial" size="2">
Gross<u><br>
Amount</u>
</font>
</td>

<font FACE="Arial" SIZE="2">
    <td width="21" align="center" class="botbord"></td>
</font>
    <td width="89" align="center" class="botbord">
      <p align="center"><font face="Arial" size="2">Accumulated<u><br>
      Amortization</u></font></p>
</td>
  </tr>

<font FACE="Arial" SIZE="2">
  <tr>
    <td width="17"></td>
    <td width="171"></td>
    <td width="21" align="right"></td>
    <td width="84" align="right"></td>
    <td width="19" align="right"></td>
    <td width="95" align="right"></td>
    <td width="36" align="right"></td>
    <td width="17" align="right"></td>
    <td width="77" align="right"></td>
    <td width="21" align="right"></td>
    <td width="89" align="right"></td>
  </tr>
</font>
  <tr>
    <td width="190" colspan="2"><font face="Arial" size="2">Amortized intangible
      assets</font></td>
<font FACE="Arial" SIZE="2">
    <td width="21" align="right"></td>
    <td width="84" align="right"></td>
    <td width="19" align="right"></td>
    <td width="95" align="right"></td>
    <td width="36" align="right"></td>
    <td width="17" align="right"></td>
    <td width="77" align="right"></td>
    <td width="21" align="right"></td>
    <td width="89" align="right"></td>
  </tr>
  <tr>
    <td width="17"></td>
    </font>
    <td width="171"><font face="Arial" size="2">Purchased service contracts</font></td>
    <td width="21" align="right"><font face="Arial" size="2">$</font></td>
    <td width="84" align="right">
<font face="Arial" size="2">
    705&nbsp;&nbsp;&nbsp;&nbsp;
    </font>
    </td>
    <td width="19" align="right">
<font face="Arial" size="2">
$</font></td>
    <td width="95" align="right">
<font face="Arial" size="2">
    (213)&nbsp;&nbsp;&nbsp;&nbsp;
    </font>
    </td>
    <td width="36" align="right">
    </td>
    <td width="17" align="right">
<font face="Arial" size="2">
$</font></td>
    <td width="77" align="right"><font face="Arial" size="2">684&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td width="21" align="right"><font face="Arial" size="2">$</font></td>
    <td width="89" align="right"><font face="Arial" size="2">(199)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>
<font FACE="Arial" SIZE="2">
  <tr>
    <td width="17"></td>
</font>
    <td width="171"><font face="Arial" size="2">Patents and trademarks</font></td>
<font FACE="Arial" SIZE="2">
    <td width="21" align="right"></td>
</font>
    <td width="84" align="right">
<font face="Arial" size="2">
    152&nbsp;&nbsp;&nbsp;&nbsp;
</font>
  </td>
<font FACE="Arial" SIZE="2">
    <td width="19" align="right"></td>
</font>
    <td width="95" align="right">
<font face="Arial" size="2">
    (28)&nbsp;&nbsp;&nbsp;&nbsp;
</font>
  </td>
<font FACE="Arial" SIZE="2">
    <td width="36" align="right"></td>
    <td width="17" align="right"></td>
</font>
    <td width="77" align="right"><font face="Arial" size="2">152&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td width="21" align="right"></td>
    <td width="89" align="right"><font face="Arial" size="2">(26)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>
<font FACE="Arial" SIZE="2">
  <tr>
    <td width="17"></td>
</font>
    <td width="171"><font face="Arial" size="2">Other, principally customer<br>
      &nbsp;&nbsp; relationships</font></td>
<font FACE="Arial" SIZE="2">
    <td width="21" align="right"></td>
</font>
    <td width="84" class="botbord" align="right" valign="bottom">
<font face="Arial" size="2">
    70&nbsp;&nbsp;&nbsp;&nbsp;
    </font>
  </td>
<font FACE="Arial" SIZE="2">
    <td width="19" align="right"></td>
</font>
    <td width="95" align="right" valign="bottom">
<font face="Arial" size="2">
    (20)&nbsp;&nbsp;&nbsp;&nbsp;
</font>
  </td>
<font FACE="Arial" SIZE="2">
    <td width="36" class="botbord" align="right"></td>
    <td width="17" class="botbord" align="right"></td>
</font>
    <td width="77" class="botbord" align="right" valign="bottom"><font face="Arial" size="2">60&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td width="21" class="botbord" align="right"></td>
    <td width="89" class="botbord" align="right"><font face="Arial" size="2">&nbsp;&nbsp;<br>
      (17)&nbsp;&nbsp; &nbsp;&nbsp;&nbsp;</font></td>
  </tr>
<font FACE="Arial" SIZE="2">
  <tr>
    <td width="17"></td>
    <td width="171"></td>
</font>
    <td width="21" align="right"><font face="Arial" size="2">$</font></td>
    <td width="86" class="double" align="right" style="border-top-style: solid; border-top-width: thin; border-bottom-style: double; border-bottom-width: thick">
<font face="Arial" size="2">
    927&nbsp;&nbsp;&nbsp;&nbsp;
    </font>
  </td>
    <td width="19" align="right">
<font face="Arial" size="2">
$</font></td>
    <td width="95" align="right" style="border-top-style: solid; border-top-width: thin; border-bottom-style: double; border-bottom-width: thick">
<font face="Arial" size="2">
    (261)&nbsp;&nbsp;&nbsp;&nbsp;
    </font>
  </td>
    <td width="36" class="double" align="right">
  </td>
    <td width="17" class="double" align="right">
<font face="Arial" size="2">
$</font></td>
    <td width="79" class="double" align="right" style="border-top-style: solid; border-top-width: thin; border-bottom-style: double; border-bottom-width: thick"><font face="Arial" size="2">896&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td width="21" class="double" align="right"><font face="Arial" size="2">$</font></td>
    <td width="91" class="double" align="right" style="border-top-style: solid; border-top-width: thin; border-bottom-style: double; border-bottom-width: thick"><font face="Arial" size="2">&nbsp;&nbsp;(242)&nbsp;&nbsp;&nbsp;
      &nbsp;&nbsp;</font></td>
  </tr>
</table>
  </center>
</div>
<font FACE="Arial" SIZE="2">
<p ALIGN="center">7</p>
<hr>

<p align="center"><b>UNITED TECHNOLOGIES CORPORATION<br>
AND SUBSIDIARIES</b></p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; Amortization of intangible assets for the
quarters ended March 31, 2003 and 2002 was $14 million and $10 million,
respectively. Amortization of these intangible assets for 2003 to 2007 is
expected to approximate $50 million per year.</p>
<p style="tab-stops:.5in"><font face="Arial" size="2"><b>Restructuring</b></font></p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; In January 2003, the Corporation adopted
SFAS 146, "Accounting for Costs Associated with Exit or Disposal
Activities.&quot; SFAS 146 provides guidance on the recognition and measurement
of liabilities associated with exit or disposal activities and requires that
such liabilities be recognized when incurred. This statement is effective for
exit or disposal activities initiated on or after January 1, 2003 and does not
impact recognition of costs under the Corporation's existing programs.
Adoption of this standard may impact the timing of recognition of costs
associated with future exit and disposal activities, depending upon the actions
initiated. </p>

<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;

<font FACE="Arial" SIZE="2">
During 2002, the Corporation recorded pre-tax restructuring and related charges
totaling $321 million. These charges related to ongoing cost reduction efforts,
including workforce reductions and consolidation of manufacturing, sales and
service facilities. These programs are expected to result in net workforce
reductions of approximately 7,000 salaried and hourly employees, the elimination
of approximately 2.0 million square feet of facilities and the disposal of
assets associated with exited facilities. As of March 31, 2003, reductions of
approximately 1,600 employees and approximately 800 thousand square feet remain
under the programs. As of March 31, 2003, approximately $87 million of severance
and related costs and $8 million of facility exit and lease termination accruals
remain. The programs are expected to be completed in 2003. </p>

<font FACE="Arial" SIZE="3">
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;</font></font>
<font face="Arial" size="3"> </font>
<font FACE="Arial" SIZE="2">
During the second half of 2001, the Corporation recorded pre-tax charges
totaling $348 million associated with ongoing cost reduction efforts and to
address challenging market conditions in the commercial airline industry. These
programs have resulted in net workforce reductions of approximately 8,100
salaried and hourly employees, the elimination of approximately 2.1 million
square feet of facilities and the disposal of assets associated with exited
facilities. As of March 31, 2003, these actions are substantially complete.</p>
</font>
<p ALIGN="JUSTIFY"><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;
During the first quarter of 2003, the Corporation recorded charges in
connection with its continuing cost reduction efforts, primarily in
the Pratt &amp; Whitney segment, that are similar in nature to those noted above. The amounts were not material
to the results of any individual segment or the Corporation's consolidated
financial condition, results of operations or cash flows.</p></font>

<p ALIGN="JUSTIFY"><b><font face="Arial" size="2">Contingent Liabilities</font>
  </p>
  </b>
  <p ALIGN="JUSTIFY"><font face="Arial" size="2">&nbsp;&nbsp;&nbsp; There has been no significant change in
  the Corporation's material contingencies during 2003. Summarized below,
  however, are the matters previously described in Notes 1 and 16 of the Notes
  to the Consolidated Financial Statements in the Corporation's Annual Report,
  incorporated by reference in Form 10-K for calendar year 2002.</p>
  <u>
  <p ALIGN="JUSTIFY">Environmental</p>
  </u>
  <p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; The Corporation's operations are subject to environmental
  regulation by federal, state and local authorities in the United States and
  regulatory authorities with jurisdiction over its foreign operations.</p>
  <p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; Environmental investigatory,
  remediation, operating and maintenance costs are accrued when it is probable
  that a liability has been incurred and the amount can be reasonably estimated.
  The most likely cost to be incurred is accrued based on an evaluation of
  currently available facts with respect to each individual site, including
  existing technology, current laws and regulations and prior remediation
  experience. Where no amount within a range of estimates is more likely, the
  minimum is accrued. For sites with multiple responsible parties, the
  Corporation considers its likely proportionate share of the anticipated remediation costs and the ability of the other parties to fulfill their
  obligations in establishing a provision for those costs. Liabilities with
  fixed or reliably determinable future cash payments are discounted. Accrued
  environmental liabilities are not reduced by potential insurance
  reimbursements. The Corporation periodically reassesses these accrued amounts.
  Management believes that the likelihood of incurring losses materially in
  excess of amounts accrued is remote.</p>
  <p ALIGN="center">8</p>

<b>

<hr>
<b>

<p ALIGN="center"><font SIZE="2" face="Arial">UNITED TECHNOLOGIES CORPORATION<br>
AND SUBSIDIARIES</font></b></b></p>

<p ALIGN="left"><u>U.S. Government</p>
  </u>
  <p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; The Corporation is now, and believes that in light of the
  current government contracting environment it will be, the subject of one or
  more government investigations. If the Corporation or one of its business
  units were charged with wrongdoing as a result of any of these investigations,
  they could be suspended from bidding on or receiving awards of new government
  contracts pending the completion of legal proceedings. If convicted or found
  liable, the Corporation could be fined and debarred from new government
  contracting for a period generally not to exceed three years. Any contracts
  found to be tainted by fraud could be voided by the government.</p>
  <font FACE="Arial" SIZE="3"></font>
  <p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; The Corporation's contracts with the
  U.S. Government are also subject to audits. Like many defense contractors, the
  Corporation has received audit reports that recommend that certain contract
  prices should be reduced to comply with various government regulations. Some
  of these audit reports involve substantial amounts. The Corporation has made
  voluntary refunds in those cases it believes appropriate. In addition, the
  Corporation accrues for liabilities associated with those matters that are
  probable and can be reasonably estimated.</p>
  <u>
  <p ALIGN="JUSTIFY">Other</p>
  </u>
  <p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; The Corporation extends performance and
  operating cost guarantees beyond its normal warranty and service policies for
  extended periods on some of its products, particularly commercial aircraft
  engines. Liability under such guarantees is contingent upon future product
  performance and durability. In addition, the Corporation incurs discretionary
  costs to service its products in connection with product performance issues.
  The Corporation has accrued its estimated liability that may result under
  these guarantees and for service costs which are probable and can be
  reasonably estimated.</p>
  <p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;</font>
<font FACE="Arial" SIZE="2">
The Corporation also has other commitments and contingent liabilities related to
legal proceedings and matters arising out of the normal course of business.</p>
  <p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;</font>
<font FACE="Arial" SIZE="2">
The Corporation has accrued for environmental investigatory, remediation,
operating and maintenance costs, performance guarantees and other litigation and
claims based on management's estimate of the probable outcome of these
matters. While it is possible that the outcome of these matters may differ from
the recorded liability, management believes that resolution of these matters
will not have a material impact on the Corporation's financial condition,
results of operations or cash flows.</p>
  <font FACE="Arial" SIZE="3"></font><p style="tab-stops: .25in 3.5in 5.0in" align="center">9
<hr>

<b>

<p ALIGN="center">UNITED TECHNOLOGIES CORPORATION<br>
AND SUBSIDIARIES</p>

<p ALIGN="JUSTIFY"><b><font SIZE="2" face="Arial">Earnings Per Share</font></p>
</b><div align="center"><center>

<table CELLSPACING="0" BORDER="0" width="550">
  <tr>
    <td WIDTH="245" VALIGN="top"></td>
    <td WIDTH="67" VALIGN="top" align="right" colspan="3"><font face="Arial" size="2"></font></td>
    <td WIDTH="54" VALIGN="top"><font face="Arial" size="2"></font></td>
    <td WIDTH="229" VALIGN="top" align="center" colspan="3" class="botbord"><font SIZE="2"
    face="Arial"><strong>Quarter Ended March 31,</strong></font></td>
  </tr>
</b>

    </font>
  <tr>
    <td WIDTH="245" VALIGN="bottom"><font face="Arial" size="2">In Millions (except per share
    amounts)</font></td>

<b>

<font FACE="Arial" SIZE="2">
    <td WIDTH="26" VALIGN="top" align="right"></td>
    <td WIDTH="14" VALIGN="top"></td>
    <td WIDTH="19" VALIGN="top" align="right"></td>
    <td WIDTH="54" VALIGN="top"></td>
</font></b>

    <td WIDTH="104" align="right" class="medbord"><p align="center"><u>
<font FACE="Arial" size="2">
<b>2003</b></font></u></td>

<b>

<font FACE="Arial" SIZE="2">
    <td WIDTH="25" class="medbord"></td>
</font></b>

    <td WIDTH="96" align="right" class="medbord"><p align="center"><u><font FACE="Arial" size="2"><b>2002</b></font></u></td>
  </tr>
<font FACE="Arial" SIZE="2">

<font face="Arial" size="2">
<font FACE="Arial" SIZE="2">

<b>

  <tr>
    <td VALIGN="top" height="15" width="245"><font face="Arial" size="1"></font></td>
    <td VALIGN="top" align="right" height="15" width="26"><font face="Arial" size="2"></font></td>
    <td VALIGN="top" height="15" width="14"><font face="Arial" size="2"></font></td>
    <td VALIGN="top" align="right" height="15" width="19"><font face="Arial" size="2"></font></td>
    <td VALIGN="top" height="15" width="54"><font face="Arial" size="2"></font></td>
    <td VALIGN="top" align="right" height="15" width="102"><font face="Arial" size="1"></font></td>
    <td VALIGN="top" height="15" width="23"><font face="Arial" size="1"></font></td>
    <td VALIGN="top" align="right" height="15" width="94"></td>
  </tr>
</b>

  <tr>
    <td WIDTH="245" VALIGN="top"><font SIZE="2" face="Arial">Net income</font></td>

<b>

    <td WIDTH="26" VALIGN="top" align="right"></td>
    <td WIDTH="14" VALIGN="top"></td>
    <td WIDTH="19" VALIGN="top" align="right"></td>
    </b>

    <td WIDTH="54" VALIGN="top"><p ALIGN="RIGHT"><font face="Arial" size="2">$</font></td>
    <td WIDTH="102" VALIGN="top" align="right">
<font FACE="Arial" SIZE="2">

502 &nbsp;&nbsp;</font></td>
    <td WIDTH="23" VALIGN="top"><p ALIGN="RIGHT"><font SIZE="2" face="Arial">$</font></td>
    <td WIDTH="102" VALIGN="top" align="right"><font size="2" face="Arial">467 &nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="245" VALIGN="top"><font SIZE="2" face="Arial">Less: ESOP Stock dividends</font></td>

<b>

    <td WIDTH="26" VALIGN="top" align="right"></td>
    <td WIDTH="14" VALIGN="top"></td>
    <td WIDTH="19" VALIGN="top" align="right"></td>
    <td WIDTH="54" VALIGN="top"></td>
    </b>

    <td WIDTH="104" VALIGN="top" align="right" style="border-bottom-style: solid; border-bottom-width: thin">
<font FACE="Arial" SIZE="2">

&nbsp;&nbsp;&nbsp; (8)&nbsp;&nbsp;</font></td>

<b>

    <td WIDTH="23" VALIGN="top"></td>
    </b>

    <td WIDTH="104" VALIGN="top" align="right" style="border-bottom-style: solid; border-bottom-width: thin">
<font FACE="Arial" SIZE="2">

&nbsp;&nbsp;&nbsp; (8)&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="245" VALIGN="top"><font SIZE="2" face="Arial">Basic earnings</font></td>

<b>

    <td WIDTH="26" VALIGN="top" align="right"></td>
    <td WIDTH="14" VALIGN="top"></td>
    <td WIDTH="19" VALIGN="top" align="right"></td>
    <td WIDTH="54" VALIGN="top"></td>
    </b>

    <td WIDTH="102" VALIGN="top" align="right"><font SIZE="2" face="Arial">494 &nbsp;&nbsp; </font></td>

<b>

    <td WIDTH="23" VALIGN="top"></td>
    </b>

    <td WIDTH="102" VALIGN="top" align="right"><font SIZE="2" face="Arial">459 &nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="245" VALIGN="top"><font SIZE="2" face="Arial">ESOP Stock adjustment</font></td>

<b>

    <td WIDTH="26" VALIGN="top" align="right"></td>
    <td WIDTH="14" VALIGN="top"></td>
    <td WIDTH="19" VALIGN="top" align="right"></td>
    <td WIDTH="54" VALIGN="top"></td>
    </b>

    <td WIDTH="102" VALIGN="top" align="right"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;
      7 &nbsp;&nbsp; </font></td>

<b>

    <td WIDTH="23" VALIGN="top"></td>
    </b>

    <td WIDTH="102" VALIGN="top" align="right"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;
      7 &nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="245" VALIGN="top"><font SIZE="2" face="Arial">Diluted earnings</font></td>

<b>

    <td WIDTH="26" VALIGN="top" align="right"></td>
    <td WIDTH="14" VALIGN="top"></td>
    <td WIDTH="19" VALIGN="top" align="right"></td>
    </b>

    <td WIDTH="54" VALIGN="top"><p ALIGN="RIGHT"><font face="Arial" size="2">$</font></td>
    <td WIDTH="104" VALIGN="top" align="right"
    style="border-top-style: solid; border-top-width: thin; border-bottom-style: double; border-bottom-width: thick"><font SIZE="2" face="Arial">501
      &nbsp;&nbsp;
    </font></td>
    <td WIDTH="23" VALIGN="top"><p ALIGN="RIGHT"><font SIZE="2" face="Arial">$</font></td>
    <td WIDTH="104" VALIGN="top" align="right"
    style="border-top-style: solid; border-top-width: thin; border-bottom-style: double; border-bottom-width: thick"><font SIZE="2" face="Arial">466
      &nbsp;&nbsp;
    </font></td>
  </tr>

<b>

  <tr>
    <td VALIGN="top" height="15" width="245"></td>
    <td VALIGN="top" align="right" height="15" width="26"></td>
    <td VALIGN="top" height="15" width="14"></td>
    <td VALIGN="top" align="right" height="15" width="19"></td>
    <td VALIGN="top" height="15" width="54"></td>
    <td VALIGN="top" align="right" height="15" width="102"></td>
    <td VALIGN="top" height="15" width="23"></td>
    <td VALIGN="top" align="right" height="15" width="94"></td>
  </tr>
</b>

  <tr>
    <td WIDTH="245" VALIGN="top"><font SIZE="2" face="Arial">Average shares:</font></td>

<b>

    <td WIDTH="26" VALIGN="top" align="right"></td>
    <td WIDTH="14" VALIGN="top"></td>
    <td WIDTH="19" VALIGN="top" align="right"></td>
    <td WIDTH="54" VALIGN="top"></td>
    <td WIDTH="102" VALIGN="top" align="right"></td>
    <td WIDTH="23" VALIGN="top"></td>
    <td WIDTH="94" VALIGN="top" align="right"></td>
  </tr>
</b>

  <tr>
    <td WIDTH="245" VALIGN="top"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp; Basic</font></td>

<b>

    <td WIDTH="26" VALIGN="top" align="right"></td>
    <td WIDTH="14" VALIGN="top"></td>
    <td WIDTH="19" VALIGN="top" align="right"></td>
    <td WIDTH="54" VALIGN="top"></td>
    </b>

    <td WIDTH="94" VALIGN="top" align="right"><font SIZE="2" face="Arial">470 &nbsp;&nbsp;</font></td>

<b>

    <td WIDTH="23" VALIGN="top"></td>
    </b>

    <td WIDTH="94" VALIGN="top" align="right"><font SIZE="2" face="Arial">473 &nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="245" VALIGN="top" style="font-size: 10pt; font-family: Arial"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp; Stock awards</font></td>

<b>

    <td WIDTH="26" VALIGN="top" align="right" style="font-size: 10pt; font-family: Arial"></td>
    <td WIDTH="14" VALIGN="top" style="font-size: 10pt; font-family: Arial"></td>
    <td WIDTH="19" VALIGN="top" align="right" style="font-size: 10pt; font-family: Arial"></td>
    <td WIDTH="54" VALIGN="top" style="font-size: 10pt; font-family: Arial"></td>
    </b>

    <td WIDTH="94" VALIGN="top" align="right" style="font-size: 10pt; font-family: Arial"><font SIZE="2" face="Arial">5 &nbsp;&nbsp;</font></td>

<b>

    <td WIDTH="23" VALIGN="top" style="font-size: 10pt; font-family: Arial"></td>
    </b>

    <td WIDTH="94" VALIGN="top" align="right" style="font-size: 10pt; font-family: Arial"><font SIZE="2" face="Arial">8 &nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="245" VALIGN="top"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp; ESOP Stock </font></td>

<b>

    <td WIDTH="26" VALIGN="top" align="right"></td>
    <td WIDTH="14" VALIGN="top"></td>
    <td WIDTH="19" VALIGN="top" align="right"></td>
    <td WIDTH="54" VALIGN="top"></td>
    </b>

    <td WIDTH="94" VALIGN="top" align="right"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;
      26 &nbsp;&nbsp;</font></td>

<b>

    <td WIDTH="23" VALIGN="top"></td>
    </b>

    <td WIDTH="94" VALIGN="top" align="right"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp;&nbsp;
      26 &nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="245" VALIGN="top"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp; Diluted</font></td>

<b>

    <td WIDTH="26" VALIGN="top" align="right"></td>
    <td WIDTH="14" VALIGN="top"></td>
    <td WIDTH="19" VALIGN="top" align="right"></td>
    <td WIDTH="54" VALIGN="top"></td>
    </b>

    <td WIDTH="96" VALIGN="top" align="right"
    style="border-top-style: solid; border-top-width: thin; border-bottom-style: double; border-bottom-width: thick"><font SIZE="2" face="Arial">501 &nbsp;&nbsp;</font></td>

<b>

    <td WIDTH="23" VALIGN="top"></td>
    </b>

    <td WIDTH="96" VALIGN="top" align="right"
    style="border-top-style: solid; border-top-width: thin; border-bottom-style: double; border-bottom-width: thick"><font SIZE="2" face="Arial">507 &nbsp;&nbsp;</font></td>
  </tr>

<b>

  <tr>
    <td VALIGN="top" height="15" width="245"></td>
    <td VALIGN="top" align="right" height="15" width="26"></td>
    <td VALIGN="top" height="15" width="14"></td>
    <td VALIGN="top" align="right" height="15" width="19"></td>
    <td VALIGN="top" height="15" width="54"></td>
    <td VALIGN="top" align="right" height="15" width="102"></td>
    <td VALIGN="top" height="15" width="23"></td>
    <td VALIGN="top" align="right" height="15" width="94"></td>
  </tr>
</b>

  <tr>
    <td WIDTH="271" VALIGN="top" colspan="2"><font SIZE="2" face="Arial">Earnings per share of Common
    Stock:</font></td>

<b>

    <td WIDTH="14" VALIGN="top"></td>
    <td WIDTH="19" VALIGN="top" align="right"></td>
    <td WIDTH="54" VALIGN="top"></td>
    <td WIDTH="102" VALIGN="top" align="right"></td>
    <td WIDTH="23" VALIGN="top"></td>
    <td WIDTH="94" VALIGN="top" align="right"></td>
  </tr>
</b>

  <tr>
    <td WIDTH="245" VALIGN="top"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp; Basic</font></td>

<b>

    <td WIDTH="26" VALIGN="top" align="right"></td>
    <td WIDTH="14" VALIGN="top"></td>
    <td WIDTH="19" VALIGN="top" align="right"></td>
    </b>

    <td WIDTH="54" VALIGN="top"><p ALIGN="RIGHT"><font face="Arial" size="2">$</font></td>
    <td WIDTH="102" VALIGN="top" align="right"><font SIZE="2" face="Arial">1.05 &nbsp;&nbsp;</font></td>
    <td WIDTH="23" VALIGN="top"><p ALIGN="RIGHT"><font SIZE="2" face="Arial">$</font></td>
    <td WIDTH="94" VALIGN="top" align="right"><font size="2" face="Arial">.97 &nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="245" VALIGN="top"><font SIZE="2" face="Arial">&nbsp;&nbsp;&nbsp; Diluted</font></td>

<b>

    <td WIDTH="26" VALIGN="top" align="right"></td>
    <td WIDTH="14" VALIGN="top"></td>
    <td WIDTH="19" VALIGN="top" align="right"></td>
    </b>

    <td WIDTH="54" VALIGN="top"><p ALIGN="RIGHT"><font face="Arial" size="2">$</font></td>
    <td WIDTH="102" VALIGN="top" align="right"><font SIZE="2" face="Arial">1.00 &nbsp;&nbsp;</font></td>
    <td WIDTH="23" VALIGN="top"><p ALIGN="RIGHT"><font SIZE="2" face="Arial">$</font></td>
    <td WIDTH="94" VALIGN="top" align="right"><font SIZE="2" face="Arial">.92 &nbsp;&nbsp;</font></td>
  </tr>
</table>
</center></div>

<p><b>Segment Financial Data</b></p>

<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; The Corporation's operations are
classified into four principal segments: Otis, Carrier, Pratt &amp; Whitney and
Flight Systems. Those segments were generally determined based on the management
structure of the businesses and the groupings of similar operating companies,
where each management organization has general operating autonomy over
diversified products and services.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;</font></font></font>
<font FACE="Arial" SIZE="2">Segment financial data include the results of all
majority-owned businesses, consistent with the management reporting of these
businesses. For certain of these subsidiaries, minority shareholders have
rights, which under the provisions of Emerging Issues Task Force ("EITF")
96-16, overcome the presumption of control. In the Corporation's consolidated
results, these subsidiaries are accounted for using the equity method of
accounting. The substantive participating rights granted by contract to minority
shareholders that overcome the presumption of control include minority
participation in the appointment, dismissal and compensation of senior
management, approval of organizational structure changes, policies, annual
operating and capital plans, including approval of merger and acquisition
investment activities, and annual dividend plans. These and other participating
rights that allow the minority shareholder to participate in decisions that
occur as part of the ordinary course of business are represented through the
minority shareholder's ability to block actions proposed by the majority
interest. Adjustments to reconcile segment reporting to consolidated results are
included in "Eliminations and other," which also includes certain
small subsidiaries.</p>
<font FACE="Arial" SIZE="3"></font>

<p ALIGN="center">10</p>

<b>

<hr>

<p ALIGN="center">UNITED TECHNOLOGIES CORPORATION<br>
AND SUBSIDIARIES</p>

<p>Recent Accounting Guidance</p>

</b>

<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; In January 2003, FIN No. 46,
"Consolidation of Variable Interest Entities" was
issued. The interpretation provides guidance on consolidating variable interest
entities and applies immediately to variable interests created after January 31,
2003. The guidelines of the interpretation will become applicable for the
Corporation in its third quarter 2003 financial statements for variable interest
entities created before February 1, 2003. The interpretation requires variable
interest entities to be consolidated if the equity investment at risk is not
sufficient to permit an entity to finance its activities without support from
other parties or the equity investors lack certain specified characteristics.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; The adoption of FIN 46 for variable
interests created after January 31, 2003 did not have a material impact on the
Corporation's consolidated financial condition, results of operations or cash
flows. The Corporation is continuing to review the provisions of FIN 46 to
determine its impact, if any, on future reporting periods with respect to
interests in variable interest entities created prior to February 1, 2003, and
does not currently anticipate any material accounting or disclosure requirement
under the provisions of the interpretation.</p>

<b>

<font FACE="Arial" SIZE="3"></font>
</b>

<p ALIGN="center">11</p>
<hr>

<b>

<p ALIGN="center">UNITED TECHNOLOGIES CORPORATION<br>
AND SUBSIDIARIES</p>
</b>

<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; With respect to the unaudited condensed
consolidated financial information of United Technologies Corporation for the
quarters ended March 31, 2003 and 2002, PricewaterhouseCoopers LLP
("PricewaterhouseCoopers") reported that they have applied limited
procedures in accordance with professional standards for a review of such
information. However, their report dated April 17, 2003, appearing below, states
that they did not audit and they do not express an opinion on that unaudited
condensed consolidated financial information. PricewaterhouseCoopers has not
carried out any significant or additional audit tests beyond those which would
have been necessary if their report had not been included. Accordingly, the
degree of reliance on their report on such information should be restricted in
light of the limited nature of the review procedures applied.
PricewaterhouseCoopers is not subject to the liability provisions of Section 11
of the Securities Act of 1933 ("the Act") for their report on the
unaudited condensed consolidated financial information because that report is
not a "report" or a "part" of a registration statement
prepared or certified by PricewaterhouseCoopers within the meaning of Sections 7
and 11 of the Act.</p>
<font FACE="Arial" SIZE="3"></font><b>
<p align="center"><u>REPORT OF INDEPENDENT AUDITORS</p>
</u></b>
</font>
<p><font face="Arial" size="2">To the Shareowners of<br>
&nbsp; United Technologies Corporation</font></p>
<p ALIGN="JUSTIFY"><font face="Arial" SIZE="2">&nbsp;&nbsp;&nbsp; We have reviewed the accompanying
condensed consolidated statement of operations of United Technologies
Corporation and its consolidated subsidiaries for the three-months ended March
31, 2003 and 2002, the condensed consolidated statement of cash flows for the
three-months ended March 31, 2003 and 2002, and the condensed consolidated
balance sheet as of March 31, 2003. This interim financial information is the
responsibility of the Corporation's management.</font></p>
<p ALIGN="JUSTIFY"><font face="Arial" size="2">&nbsp;&nbsp;&nbsp; We conducted our review in accordance with standards
established by the American Institute of Certified Public Accountants. A review
of interim financial information consists principally of applying analytical
procedures to financial data and making inquiries of persons responsible for
financial and accounting matters. It is substantially less in scope than an
audit conducted in accordance with auditing standards generally accepted in the
United States of America, the objective of which is the expression of an opinion
regarding the financial statements taken as a whole. Accordingly, we do not
express such an opinion.</font></p>
<p ALIGN="JUSTIFY"><font face="Arial" size="2">&nbsp;&nbsp;&nbsp; Based on our review, we are not aware of any
material modifications that should be made to the accompanying condensed
consolidated interim financial information for it to be in conformity with
accounting principles generally accepted in the United States of America.</font></p>
<p ALIGN="JUSTIFY"><font face="Arial" size="2">&nbsp;&nbsp;&nbsp; We previously audited in accordance with auditing
standards generally accepted in the United States of America, the consolidated
balance sheet as of December 31, 2002, and the related consolidated statements
of operations, of changes in shareowners' equity and of cash flows for the year
then ended (not presented herein), and in our report dated January 16, 2003, we
expressed an unqualified opinion on those consolidated financial statements. In
our opinion, the information set forth in the accompanying condensed
consolidated balance sheet as of December 31, 2002, is fairly stated in all
material respects in relation to the consolidated balance sheet from which it
has been derived.</font></p>
<p>
<font face="Arial" SIZE="2">/s/ PricewaterhouseCoopers LLP<br>
PricewaterhouseCoopers LLP<br>
Hartford, Connecticut<br>
April 17, 2003</p>

<p ALIGN="center">12</p>

<b>

<hr>

<p align="center"><font SIZE="2" face="Arial">UNITED TECHNOLOGIES CORPORATION<br>
AND SUBSIDIARIES</font></p>

<p><font SIZE="2" face="Arial">Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations</font></p>

<p align="center"><font SIZE="2" face="Arial">BUSINESS ENVIRONMENT</font></p>

</b>

<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; The Corporation's operations are
classified into four principal segments: Otis, Carrier, Pratt &amp; Whitney and
Flight Systems. Otis and Carrier serve customers in the commercial and
residential property industries. Carrier also serves commercial and transport
refrigeration customers. Pratt &amp; Whitney and the Flight Systems segment,
which includes Hamilton Sundstrand and Sikorsky Aircraft ("Sikorsky"),
primarily serve commercial and government customers in the aerospace industry.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; For discussion of the Corporation's
business environment, refer to the discussion of "Business
Environment" in the Management's Discussion and Analysis of Financial
Condition and Results of Operations in the Corporation's Annual Report
incorporated by reference in Form 10-K for calendar year 2002. The current
status of significant factors impacting the Corporation's business environment
in 2003 is discussed below.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; As worldwide businesses, the Corporation's
operations are affected by global and regional industry, economic and political
factors. The Corporation's geographic and industry diversity, as well as the
diversity of its product sales and service, has helped limit the impact of any
one industry or the economy of any single country on the consolidated results.
Current economic conditions in the commercial airline industry, global
refrigeration industries and commercial HVAC and construction markets had a
negative impact on the Corporation's consolidated results and are expected to
continue to present challenges to its businesses. In addition, the defense
portion of the Corporation's aerospace businesses is affected by changes in
market demand and the global political environment. The Corporation's
participation in long-term production and development programs for the U.S.
government has contributed positively to the Corporation's results in the first
three months of 2003 and is expected to continue for the remainder of 2003.
During the first three months of 2003, foreign currencies contributed positively
to the Corporation's consolidated results, primarily driven by the strength of
the euro in relation to the U.S. dollar.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; The Corporation's growth strategy
contemplates acquisitions. The rate and extent to which appropriate acquisition
opportunities are available and to which acquired businesses are effectively
integrated and anticipated synergies or cost savings are achieved can affect the
Corporation's operations and results.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; Traffic growth, load factors, worldwide
profits, influenced in part by fuel prices and labor issues, and general
economic activity have historically been reliable indicators for new aircraft
and aftermarket orders in the aerospace industry. Spare part sales and
aftermarket service trends are impacted by factors including usage, pricing,
regulatory changes and retirement of older aircraft. Performance in the general
aviation sector is closely tied to the overall health of the economy and is
positively correlated to corporate profits. Current conditions in the airline
industry include reduced flight schedules, an increased number of idle aircraft,
workforce reductions and declining financial performance, including recent
airline bankruptcies. Airlines and aircraft manufacturers continue to reduce
supplier bases and seek lower cost packages. These conditions have resulted in
decreased aerospace volume and orders in the Corporation's commercial
aerospace businesses in the first quarter of 2003 and are expected to continue for the
remainder of 2003. In addition, ongoing U.S. military action in Iraq has created
additional uncertainty in the airline industry.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; The Corporation's products and services
are regulated by strict safety and performance standards, particularly in the
commercial engine business. These standards can create uncertainty regarding the
profitability of commercial engine programs.</p>
<p ALIGN="center">13</p>

<b>

<hr>

<p align="center"><b><font SIZE="2" face="Arial">UNITED TECHNOLOGIES CORPORATION<br>
AND SUBSIDIARIES</font></b></p>

</b>

<p ALIGN="left">&nbsp;&nbsp;&nbsp; The impact of war in Iraq, significant
airline financial stress and slowed global economic growth, including the
potential impact of Severe Acute Respiratory Syndrome ("SARS"), create
uncertainties that could impact the Corporation's earnings outlook for the
remainder of 2003.</p>

<b>
<p ALIGN="CENTER">CRITICAL ACCOUNTING ESTIMATES</p>
<p ALIGN="left">&nbsp;&nbsp;&nbsp;</b></font><font face="Arial" size="3"> </font>
<font FACE="Arial" SIZE="2">Preparation of the Corporation's financial
statements requires management to make estimates and assumptions that affect the
reported amounts of assets, liabilities, revenues and expenses. Management
believes the most complex and sensitive judgments, because of their significance
to the consolidated financial statements, result primarily from the need to make
estimates about the effects of matters that are inherently uncertain. Management's
Discussion and Analysis and Note 1 to the Consolidated Financial Statements in
the Corporation's Annual Report, incorporated by reference in Form 10-K for
the calendar year 2002, describe the significant accounting estimates and
policies used in preparation of the Consolidated Financial Statements. Actual
results in these areas could differ from management's estimates. There have
been no significant changes in the Corporation's critical accounting estimates
during the first quarter of 2003.</p>

<p ALIGN="center"> <b>RESULTS
OF CONTINUING OPERATIONS</b></p>

<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; Consolidated revenues increased $328
million (5%) to $6.7 billion in the first quarter of 2003 compared to the same
period in 2002. Foreign currency translation increased consolidated revenues 4%
in the first quarter. The first quarter increase reflects growth at Otis,
increased helicopter and aftermarket revenues at Sikorsky and increased military
revenue at Pratt &amp; Whitney. These increases were partially offset by
declines in commercial spare parts volume in the aerospace businesses.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;</font>
<font FACE="Arial" SIZE="2">Gross margin as a percentage of sales decreased 2.2
percentage points in the first quarter of 2003 compared to 2002. The first
quarter decrease reflects lower commercial aerospace volume and the favorable
impact of the first quarter 2002 commercial engine contract changes at Pratt
&amp; Whitney, partially offset by margin improvement at Otis. Gross margin in
the first quarter of 2002 also reflects the benefit of an approximate $100
million settlement of environmental claims and $85 million of restructuring
charges.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;</font>
<font FACE="Arial" SIZE="2">Research and development spending decreased $103
million (30%) in the first quarter of 2003 compared to the same period of 2002.
The first quarter decrease is primarily associated with finalization of a
technology funding agreement at Pratt &amp; Whitney Canada, costs associated
with the PW6000 program recorded in the first quarter of 2002, and lower
spending on Sikorsky's S-92 program which received Federal Aviation
Administration type certification during the fourth quarter of 2002. As a
percentage of sales, research and development was 3.5% in the first quarter of
2003, as compared to 5.3% in the same period of 2002. Research and development
spending is subject to the variable nature of program development schedules and
is currently expected to approximate 4% of sales in 2003.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;</font>
<font FACE="Arial" SIZE="2">In addition to company funded programs, customer
funded research and development was $349 million and $237 million for the
quarters ended March 31, 2003 and 2002, respectively. The 2003 increase of $112
million is primarily attributable to Pratt &amp; Whitney's military business.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;</font>
<font FACE="Arial" SIZE="2">Selling, general and administrative expenses
increased $10 million (1%) in the first quarter of 2003 compared to the same
period of 2002. The first quarter increase reflects the impact of foreign
currency translation at Otis and Sikorsky's 2002 acquisition of Derco, partially
offset by the absence of $15 million of restructuring charges recorded in the
first quarter of 2002. As a percentage of sales, these expenses were 11.5% and
11.9% in the first quarter of 2003 and 2002, respectively.</p>
<font FACE="Arial" SIZE="3"></font>

<p align="center">14</p>

<b>

<hr>

<p align="center"><b><font SIZE="2" face="Arial">UNITED TECHNOLOGIES CORPORATION<br>
AND SUBSIDIARIES</font></b></p>

</b>

<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; Interest expense decreased $8 million (8%)
in the first quarter of 2003 compared to 2002. The decrease is due primarily to
lower short-term foreign borrowings in 2003, partially offset by interest
associated with the issuance of $500 million of 6.10% Notes in April 2002.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;</font>
<font FACE="Arial" SIZE="2">The effective income tax rate for the first quarter
of 2003 was 28.0% as compared to 28.4% for the same period of 2002, reflecting
the continued implementation of tax planning strategies.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;</font>
<font FACE="Arial" SIZE="2">Net income and diluted earnings per share increased
$35 million (7%) and $.08 (9%) for the first quarter of 2003 when compared with
the same period in 2002. The favorable impact of foreign currency translation
contributed five cents in diluted earnings per share during the first quarter of
2003.</p>
<font FACE="Arial" SIZE="3"></font>

<p ALIGN="JUSTIFY"><b>Restructuring</b></p>

<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; In January 2003, the Corporation adopted
Statement of Financial Accounting Standards (&quot;SFAS&quot;) No. 146, "Accounting for Costs
Associated with Exit or Disposal Activities.&quot; SFAS
146 provides guidance on the recognition and measurement of liabilities
associated with exit or disposal activities and requires that such liabilities
be recognized when incurred. This statement is effective for exit or disposal
activities initiated on or after January 1, 2003 and does not impact recognition
of costs under the Corporation's existing programs.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;</font>
<font FACE="Arial" SIZE="2">During 2002, the Corporation recorded pre-tax restructuring
and related charges totaling $321 million. These charges related to on-going
cost reduction efforts, including workforce reductions and consolidation of
manufacturing, sales and service facilities. These programs are expected to
result in net workforce reductions of approximately 7,000 salaried and hourly
employees, the elimination of approximately 2.0 million square feet of
facilities and the disposal of assets associated with exited facilities. During
2003, the Corporation has incurred pre-tax cash outflows related to the 2002
programs of approximately $61 million which were funded from cash generated from
operations. Savings are expected to increase over a two-year period resulting in
recurring pre-tax savings of approximately $285 million annually. As of March 31, 2003,
reductions of approximately 1,600 employees and approximately 800 thousand
square feet remain under the programs. As of March 31, 2003, approximately $87
million of severance and related costs and $8 million of facility exit and lease
termination accruals remain. The programs are expected to be completed in 2003.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;</font>
<font FACE="Arial" SIZE="2">During the second half of 2001, the Corporation
recorded pre-tax charges totaling $348 million associated with ongoing cost
reduction efforts and to address challenging market conditions in the commercial
airline industry. These programs have resulted in net workforce reductions of
approximately 8,100 salaried and hourly employees, the elimination of
approximately 2.1 million square feet of facilities and the disposal of assets
associated with exited facilities. During 2003, the Corporation has incurred
pre-tax cash outflows related to the 2001 programs of approximately $13 million
which were funded from cash generated from operations. Savings are expected to
increase over a two-year period resulting in recurring pre-tax savings of
approximately $300
million annually. As of March 31, 2003, these actions are substantially
complete.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;</font>
 <font FACE="Arial" SIZE="2">During the first quarter of 2003, the Corporation
recorded charges in connection with its continuing cost reduction efforts, primarily in the Pratt &amp; Whitney segment,
 that are similar in
nature to those noted above. The amounts were not material to the results of any individual segment
or the Corporation's consolidated financial condition, results of operations or
cash flows.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;</font>
<font FACE="Arial" SIZE="2">The Corporation may initiate additional
restructuring actions in 2003 in its ongoing efforts to reduce costs. No
significant actions have been approved at this time.</p>
<b><font FACE="Arial" SIZE="3"></font></b>

<p ALIGN="center">15</p>

<b>

<hr>

<p align="center"><b><font SIZE="2" face="Arial">UNITED TECHNOLOGIES CORPORATION<br>
AND SUBSIDIARIES</font></b></p>

<p ALIGN="JUSTIFY"></b><b style="mso-bidi-font-weight:normal">Segment
Review </b></p>

<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; Revenues, operating profits and operating
profit margins of the Corporation's principal segments include the results of
all majority-owned subsidiaries, consistent with the management reporting of
these businesses. As discussed in the Notes to the Condensed Consolidated
Financial Statements for certain of these subsidiaries, minority shareholders
have rights which overcome the presumption of control. In the consolidated
results, these subsidiaries are accounted for using the equity method of
accounting. Adjustments to reconcile segment reporting to consolidated results
are included in "Eliminations and other," which also includes certain
small subsidiaries. Results for the quarters ended March 31, 2003 and 2002 are
as follows:</p>

<table border="0" cellspacing="1" style="font-family: Arial; font-size: 10pt">
  <font face="Arial" size="2">
  <tr>
    <td width="197" nowrap height="21" valign="bottom"><br>

</font>
  </font><font face="Arial" size="1">In
Millions of Dollars</font></td>
<font FACE="Arial" SIZE="2">
  <font FACE="Arial" SIZE="2">
    <font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2">    <font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2">
<font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2">
<font FACE="Arial" SIZE="2"><font FACE="Arial" SIZE="2">
<font FACE="Arial" SIZE="2">
  <font face="Arial" size="2">
<font FACE="Arial" SIZE="2">
  <font face="Arial" size="2">
    <td width="9" align="right" height="21"></td>
    <td width="119" align="center" height="21" colspan="3" valign="bottom" class="botbord" style="border-bottom-style: groove"><b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      Revenues</b></td>
    <td width="9" align="center" height="21" valign="bottom"></td>
    <td width="111" align="center" height="21" colspan="3" valign="bottom" class="botbord" style="border-bottom-style: groove"><b>&nbsp;Operating<br>
      Profits</b></td>
    <td width="14" align="center" height="21"></td>
    <td width="154" align="center" height="21" colspan="3" class="botbord" valign="bottom" style="border-bottom-style: groove"><b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      Operating<br>
      &nbsp;&nbsp;&nbsp;&nbsp; Profit Margin</b></td>
  </tr>
  <tr>
    <td width="197" nowrap height="21"><font face="Arial" size="2"><b>Quarter Ended
      March 31,</b></font></td>
    <td width="9" align="right" height="21"></td>
    <td width="53" align="center" height="21"><u><b>2003</b></u></td>
    <td width="10" align="center" height="21"></td>
    <td width="56" align="center" height="21"><u><b>2002</b></u></td>
    <td width="9" align="center" height="21"></td>
    <td width="48" align="center" height="21"><u><b>2003</b></u></td>
    <td width="10" align="right" height="21">
      <p align="left"></td>
    <td width="53" align="center" height="21"><u><b>200</b></u><font face="Arial" size="2"><u><b>2</b></u></font></td>
    <td width="14" align="center" height="21"></td>
    <td width="77" align="center" height="21"><u><b>2003</b></u></td>
    <td width="2" align="center" height="21"></td>
    <td width="75" align="center" height="21"><u><b>2002</b></u></td>
  </tr>
  <tr>
    <td width="197" nowrap height="21">&nbsp;&nbsp;</td>
    <td width="9" align="right" height="21"></td>
    <td width="51" align="right" height="21"></td>
    <td width="10" align="right" height="21"></td>
    <td width="54" align="right" height="21"></td>
    <td width="9" align="right" height="21"></td>
    <td width="48" align="right" height="21"></td>
    <td width="10" align="right" height="21"></td>
    <td width="53" align="right" height="21"></td>
    <td width="14" align="right" height="21"></td>
    <td width="77" align="right" height="21"></td>
    <td width="2" align="right" height="21"></td>
    <td width="75" align="right" height="21"></td>
  </tr>
  <tr>
    <td width="197" nowrap height="21"><font face="Arial" size="2">&nbsp; Otis</font></td>
    <td width="9" align="right" height="21">$</td>
    <td width="51" align="right" height="21"><font face="Arial" size="2">1,820&nbsp;&nbsp;</font></td>
    <td width="10" align="right" height="21">$</td>
    <td width="51" align="right" height="21"><font face="Arial" size="2">1,536&nbsp;&nbsp;</font></td>
    <td width="9" align="right" height="21">$</td>
    <td width="48" align="right" height="21">314<font face="Arial" size="2">&nbsp;&nbsp;</font></td>
    <td width="10" align="right" height="21">$</td>
    <td width="48" align="right" height="21"><font face="Arial" size="2">234&nbsp;&nbsp;</font></td>
    <td width="14" align="right" height="21"></td>
    <td width="77" align="right" height="21"><font face="Arial" size="2">17.3%&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td width="2" align="right" height="21"></td>
    <td width="77" align="right" height="21"><font face="Arial" size="2">15.2%&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td width="197" nowrap height="21"><font face="Arial" size="2">&nbsp;
      Carrier</font></td>
    <td width="9" align="right" height="21"></td>
    <td width="51" align="right" height="21"><font face="Arial" size="2">1,957&nbsp;&nbsp;</font></td>
    <td width="10" align="right" height="21"></td>
    <td width="51" align="right" height="21"><font face="Arial" size="2">1,896&nbsp;&nbsp;</font></td>
    <td width="9" align="right" height="21"></td>
    <td width="48" align="right" height="21"><font face="Arial" size="2">151&nbsp;&nbsp;</font></td>
    <td width="10" align="right" height="21"></td>
    <td width="48" align="right" height="21"><font face="Arial" size="2">61&nbsp;&nbsp;</font></td>
    <td width="14" align="right" height="21"></td>
    <td width="77" align="right" height="21"><font face="Arial" size="2">7.7%&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td width="2" align="right" height="21"></td>
    <td width="77" align="right" height="21"><font face="Arial" size="2">3.2%&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td width="197" nowrap height="21"><font face="Arial" size="2">&nbsp; Pratt
      &amp; Whitney</font></td>
    <td width="9" align="right" height="21"></td>
    <td width="51" align="right" height="21"><font face="Arial" size="2">1,731&nbsp;&nbsp;</font></td>
    <td width="10" align="right" height="21"></td>
    <td width="51" align="right" height="21"><font face="Arial" size="2">1,840&nbsp;&nbsp;</font></td>
    <td width="9" align="right" height="21"></td>
    <td width="48" align="right" height="21"><font face="Arial" size="2">276&nbsp;&nbsp;</font></td>
    <td width="10" align="right" height="21"></td>
    <td width="48" align="right" height="21"><font face="Arial" size="2">318&nbsp;&nbsp;</font></td>
    <td width="14" align="right" height="21"></td>
    <td width="77" align="right" height="21"><font face="Arial" size="2">15.9%&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td width="2" align="right" height="21"></td>
    <td width="77" align="right" height="21"><font face="Arial" size="2">17.3%&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td width="197" nowrap height="20"><font face="Arial" size="2">&nbsp; Flight
      Systems</font></td>
    <td width="9" align="right" height="20"></td>
    <td width="51" align="right" class="botbord" height="20" style="border-bottom-style: solid; border-bottom-width: thin"><font face="Arial" size="2">1,317&nbsp;&nbsp;</font></td>
    <td width="10" align="right" height="20"></td>
    <td width="51" align="right" class="botbord" height="20" style="border-bottom-style: solid; border-bottom-width: thin"><font face="Arial" size="2">1,209&nbsp;&nbsp;</font></td>
    <td width="9" align="right" height="20"></td>
    <td width="48" align="right" class="botbord" height="20" style="border-bottom-style: solid; border-bottom-width: thin"><font face="Arial" size="2">187&nbsp;&nbsp;</font></td>
    <td width="10" align="right" height="20"></td>
    <td width="48" align="right" class="botbord" height="20" style="border-bottom-style: solid; border-bottom-width: thin"><font face="Arial" size="2">158&nbsp;&nbsp;</font></td>
    <td width="14" align="right" height="20"></td>
    <td width="77" align="right" height="20"><font face="Arial" size="2">14.2%&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td width="2" align="right" height="20"></td>
    <td width="77" align="right" height="20"><font face="Arial" size="2">13.1%&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td width="197" nowrap height="21"><font face="Arial" size="2">&nbsp; Total
      segment</font></td>
    <td width="9" align="right" height="21"></td>
    <td width="51" align="right" height="21"><font face="Arial" size="2">6,825&nbsp;&nbsp;</font></td>
    <td width="10" align="right" height="21"></td>
    <td width="51" align="right" height="21"><font face="Arial" size="2">6,481&nbsp;&nbsp;</font></td>
    <td width="9" align="right" height="21"></td>
    <td width="48" align="right" height="21"><font face="Arial" size="2">928&nbsp;&nbsp;</font></td>
    <td width="10" align="right" height="21"></td>
    <td width="48" align="right" height="21"><font face="Arial" size="2">771&nbsp;&nbsp;</font></td>
    <td width="14" align="right" height="21"></td>
    <td width="77" align="right" height="21"><font face="Arial" size="2">13.6%&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td width="2" align="right" height="21"></td>
    <td width="77" align="right" height="21"><font face="Arial" size="2">11.9%&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td width="197" nowrap height="21"><font face="Arial" size="2">&nbsp;
      Eliminations and other</font></td>
    <td width="9" align="right" height="21"></td>
    <td width="51" align="right" height="21"><font face="Arial" size="2">(123)&nbsp;</font></td>
    <td width="10" align="right" height="21"></td>
    <td width="51" align="right" height="21"><font face="Arial" size="2">(107)&nbsp;</font></td>
    <td width="9" align="right" height="21"></td>
    <td width="48" align="right" height="21">
  <font face="Arial" size="2">
    (37)&nbsp;

</font>
    </td>
    <td width="10" align="right" height="21"></td>
    <td width="48" align="right" height="21"><font face="Arial" size="2">83&nbsp;&nbsp;</font></td>
    <td width="14" align="right" height="21"></td>
    <td width="77" align="right" height="21"></td>
    <td width="2" align="right" height="21"></td>
    <td width="75" align="right" height="21"></td>
  </tr>
  <tr>
    <td width="197" nowrap height="23">
      <p align="left"><font face="Arial" size="2">&nbsp; General corporate expenses</font></p>
    </td>
    <td width="9" align="right" height="23"></td>
    <td width="51" align="right" class="botbord" height="23">
      <p align="right"><font face="Arial" size="2">-&nbsp;&nbsp;</font></td>
    <td width="10" align="right" height="23"></td>
    <td width="51" align="right" class="botbord" height="23">
      <p align="right"><font face="Arial" size="2">-&nbsp;&nbsp;</font></td>
    <td width="9" align="right" height="23">
      <p align="right"></p>
    </td>
    <td width="48" align="right" class="botbord" height="23"><font face="Arial" size="2">(54)&nbsp;</font></td>
    <td width="10" align="right" height="23"></td>
    <td width="48" align="right" class="botbord" height="23"><font face="Arial" size="2">(57)&nbsp;</font></td>
    <td width="14" align="right" height="23"></td>
    <td width="77" align="right" height="23"></td>
    <td width="2" align="right" height="23"></td>
    <td width="75" align="right" height="23"></td>
  </tr>
  <tr>
    <td width="197" nowrap height="24"><font face="Arial" size="2">&nbsp;
      Consolidated</font></td>
    <td width="9" align="right" height="24"><font face="Arial" size="2">$</font></td>
    <td width="51" align="right" class="double" height="24" style="border-top-style: solid; border-top-width: thin; border-bottom-style: double; border-bottom-width: thick"><font face="Arial" size="2">6,702&nbsp;&nbsp;</font></td>
    <td width="10" align="right" height="24">$</td>
    <td width="51" align="right" class="double" height="24" style="border-top-style: solid; border-top-width: thin; border-bottom-style: double; border-bottom-width: thick"><font face="Arial" size="2">6,374&nbsp;&nbsp;</font></td>
    <td width="9" align="right" height="24"></td>
    <td width="48" align="right" height="24" style="border-top-style: solid; border-top-width: thin"><font face="Arial" size="2">837&nbsp;</font></td>
    <td width="10" align="right" height="24"></td>
    <td width="48" align="right" height="24" style="border-top-style: solid; border-top-width: thin"><font face="Arial" size="2">797&nbsp;</font></td>
    <td width="14" align="right" height="24"></td>
    <td width="77" align="right" height="24"></td>
    <td width="2" align="right" height="24"></td>
    <td width="75" align="right" height="24"></td>
  </tr>
  <tr>
    <td width="197" nowrap height="15"><font face="Arial" size="2">&nbsp;
      Interest expense</font></td>
    <td width="9" align="right" height="15"></td>
    <td width="51" align="right" height="15"></td>
    <td width="10" align="right" height="15"></td>
    <td width="56" align="right" height="15"></td>
    <td width="9" align="right" height="15"></td>
    <td width="48" align="right" class="botbord" height="15"><font face="Arial" size="2">(91)&nbsp;</font></td>
    <td width="10" align="right" height="15"></td>
    <td width="48" align="right" class="botbord" height="15"><font face="Arial" size="2">(99)&nbsp;</font></td>
    <td width="14" align="right" height="15"></td>
    <td width="77" align="right" height="15"></td>
    <td width="2" align="right" height="15"></td>
    <td width="75" align="right" height="15"></td>
  </tr>
  <tr>
    <td width="197" nowrap height="40"><font face="Arial" size="2">&nbsp; Income
      before income taxes<br>
      &nbsp;&nbsp;&nbsp; and minority interests</font></td>
    <td width="9" align="right" height="40"></td>
    <td width="51" align="right" height="40"></td>
    <td width="10" align="right" height="40"></td>
    <td width="56" align="right" height="40"></td>
    <td width="9" align="right" height="40"><br>
      <font face="Arial" size="2">$</font></td>
    <td width="48" align="right" class="double" height="40" style="border-top-style: solid; border-top-width: thin; border-bottom-style: double; border-bottom-width: thick"><font face="Arial" size="2"><br>
      746&nbsp;</font></td>
    <td width="10" align="right" height="40"><font face="Arial" size="2"><br>
      $</font></td>
    <td width="48" align="right" class="double" height="40" style="border-top-style: solid; border-top-width: thin; border-bottom-style: double; border-bottom-width: thick"><font face="Arial" size="2"><br>
      698&nbsp;</font></td>
    <td width="14" align="right" height="40"></td>
    <td width="77" align="right" height="40"></td>
    <td width="2" align="right" height="40"></td>
    <td width="75" align="right" height="40"></td>
  </tr>
</table>

</font>
</font></font></font></font></font></font></font></font></font></font></font></font></font></font></font></font></font></font></font></font></font></font></font></font></font></font></font></font></font></font></font></font></font></font></font></font></font></font>
  <font face="Arial" size="2">
<font FACE="Arial" SIZE="2">
<p ALIGN="JUSTIFY">First quarter 2002 restructuring and related charges included in segment
operating profit are as follows:<br>
Otis - $16, Carrier - $74, Pratt &amp; Whitney - $9, and Flight Systems - $5.
</p>

<p ALIGN="JUSTIFY">The Corporation recorded restructuring
charges in the first quarter of 2003, primarily in the Pratt &amp; Whitney
segment, similar in nature to those noted above. The amounts were not material.</p>
<b>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;</b>
 </font>
</font> <font FACE="Arial" SIZE="2">
  <b>Otis</b> revenues increased $284 million (18%) in the first quarter of 2003
  compared to the same period of 2002. Foreign currency translation increased
  revenues by approximately 10% during the first quarter of 2003 due primarily
  to the strengthening of the euro in relation to the U.S. dollar. The first quarter
  increase reflects growth in all regions and includes approximately six percentage points of organic growth.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;</font>
 <font FACE="Arial" SIZE="2">
  Otis operating profits increased $80 million (34%) in the first quarter of
  2003 compared to the same period of 2002. Foreign currency translation
  increased operating profits by approximately 14% in the first quarter of 2003.
  The 2003 increase also reflects profit improvement in all regions and the
  absence of first quarter 2002 restructuring charges of $16 million.</p>
<p ALIGN="JUSTIFY"><b>&nbsp;&nbsp;&nbsp;</b></font>
 <font FACE="Arial" SIZE="2">
  <b>Carrier</b> revenues increased $61 million (3%) in the first quarter of
  2003 compared to the same period of 2002. Foreign currency translation
  increased revenues approximately 3% during the first quarter due primarily to
  the strength of the euro in relation to the U.S. dollar. The first quarter
  reflects higher volume in North American residential HVAC and the transport
  refrigeration business, largely offset by continued commercial HVAC weakness
  in the United States and also in Europe.</p>
<font FACE="Arial" SIZE="3"></font>

<p ALIGN="center">16</p>

<hr>

<b>

<p align="center">UNITED TECHNOLOGIES CORPORATION<br>
AND SUBSIDIARIES</p>

</b>

<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; Carrier's operating profits increased
$90 million (148%) in the first quarter of 2003 compared to the same period of
2002, reflecting $74 million of restructuring costs recorded in the first
quarter of 2002. Foreign currency translation increased operating profits by
approximately 10% in the first quarter of 2003. The first quarter operating
profit increase also reflects continued benefits from cost reduction actions and
higher volume in North American residential HVAC and the transport refrigeration
business, partially offset by continued weakness in commercial HVAC.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;</font>
 <font FACE="Arial" SIZE="2">
  <b>Pratt &amp; Whitney</b> revenues decreased $109 million (6%) in the first
  quarter of 2003 compared to the same period of 2002. The first quarter
  decrease was due primarily to declines in commercial spare parts and lower
  volume at Pratt &amp; Whitney Power Systems and Pratt &amp; Whitney Canada,
  partially offset by increases in military revenue.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;</font>
 <font FACE="Arial" SIZE="2">
  Pratt &amp; Whitney operating profits decreased $42 million (13%) in the first
  quarter of 2003 compared to the same period of 2002, reflecting declines in
  commercial spare parts and the favorable impact of commercial engine contract
  changes recorded in 2002. These decreases were partially offset by the profit
  impact of increased military revenues and lower research and development costs
  reflecting finalization of a technology funding agreement at Pratt &amp;
  Whitney Canada and the absence of PW6000 program costs recorded in the first
  quarter of 2002.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;</font>
 <font FACE="Arial" SIZE="2">
  <b>Flight Systems</b> revenues increased $108 million (9%) in the first
  quarter of 2003 compared to the same period of 2002. The first quarter
  increase was due to increased aftermarket revenues, due in part to the
  acquisition of Derco in 2002, and higher helicopter sales at Sikorsky. These
  increases were partially offset by lower commercial aerospace volume and
  aftermarket sales at Hamilton Sundstrand.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;</font>
 <font FACE="Arial" SIZE="2">
  Flight Systems operating profits increased $29 million (18%) in the first
  quarter of 2003 compared to the same period of 2002. This increase was due
  primarily to higher aftermarket volume, improved aircraft program performance
  and lower S-92 spending at Sikorsky, partially offset by lower commercial
  aerospace volume at Hamilton Sundstrand.</p>

<b>

<p class="MsoNormal" style="tab-stops: .25in center 3.5in" align="center"><b style="mso-bidi-font-weight:normal">LIQUIDITY AND FINANCIAL
CONDITION</b></p>

</b>

<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; Management assesses the Corporation's
liquidity in terms of its ability to generate cash to fund its operating,
investing and financing activities. Significant factors affecting the management
of liquidity are cash flows generated from operating activities, capital
expenditures, customer financing requirements, investments in businesses,
dividends, Common Stock repurchases, adequacy of available bank lines of credit
and the ability to attract long-term capital with satisfactory terms.</p>

<b>

<div align="center">
  <center>

<table CELLSPACING="0" BORDER="0" width="625" height="191">
  <tr>
    <td WIDTH="249" VALIGN="TOP" height="36"><font face="Arial" size="2"><br>
    In Millions of Dollars</font></td>
    <td WIDTH="15" VALIGN="TOP" height="36"></td>
    <td WIDTH="123" align="center" class="medbord" style="border-bottom-style: groove" height="36"><strong><font face="Arial" size="2">March
    31,<br>
      2003</font></strong></td>
    <td WIDTH="22" VALIGN="bottom" align="center" class="medbord" height="36"></td>
    <td WIDTH="123" align="center" class="medbord" style="border-bottom-style: groove" height="36"><font face="Arial" size="2"><b>December 31,<br>
      2002</b></font></td>
    <td WIDTH="30" align="center" class="medbord" height="36"></td>
    <td WIDTH="113" align="center" class="medbord" style="border-bottom-style: groove" height="36"><font face="Arial" size="2"><b>March 31,<br>
      2002</b></font></td>
  </tr>

</b>

  </font>

  <tr>
    <td VALIGN="top" height="18" width="249"><font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td VALIGN="top" height="18" width="15"><font face="Arial" size="2">&nbsp;&nbsp;</font></td>
    <td VALIGN="top" height="18" width="123"><font face="Arial" size="2">&nbsp;&nbsp;</font></td>
    <td VALIGN="top" height="18" width="22"><font face="Arial" size="2">&nbsp;&nbsp;</font></td>
    <td VALIGN="top" height="18" width="123"><font face="Arial" size="2">&nbsp;&nbsp;</font></td>
    <td VALIGN="top" height="18" width="30"><font face="Arial" size="2">&nbsp;&nbsp;</font></td>
    <td VALIGN="top" height="18" width="113"><font face="Arial" size="2">&nbsp;&nbsp;</font></td>
  </tr>
  <tr>
    <td WIDTH="249" VALIGN="TOP" height="18"><font face="Arial" size="2">Cash and cash equivalents</font></td>
    <td WIDTH="15" VALIGN="TOP" height="18"><p ALIGN="RIGHT"><font face="Arial" size="2">$</font></td>
    <td WIDTH="123" VALIGN="TOP" align="right" height="18"><font size="2" face="Arial">1,927
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font>

    </td>
    <td WIDTH="22" VALIGN="TOP" height="18"><p ALIGN="RIGHT"><font face="Arial" size="2">$</font></td>
    <td WIDTH="123" VALIGN="TOP" align="right" height="18"><font face="Arial" size="2">2,080
      &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td WIDTH="30" VALIGN="TOP" height="18"><p ALIGN="RIGHT"><font face="Arial" size="2">$</font></td>
    <td WIDTH="123" VALIGN="TOP" align="right" height="18"><font face="Arial" size="2">1,337
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
  </tr>
  <tr>
    <td WIDTH="249" VALIGN="TOP" height="18"><font face="Arial" size="2">Total debt</font></td>

<b>

    <font FACE="Arial" SIZE="2">
    <td WIDTH="15" VALIGN="TOP" height="18"></td>
    </font>

</b>

    <td WIDTH="123" VALIGN="TOP" align="right" height="18"><font size="2" face="Arial">4,904
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font>

    </td>

<b>

    <font FACE="Arial" SIZE="2">
    <td WIDTH="22" VALIGN="TOP" height="18"></td>
    </font>

</b>

    <td WIDTH="123" VALIGN="TOP" align="right" height="18"><font face="Arial" size="2">4,873
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </font></td>

<b>

    <font FACE="Arial" SIZE="2">
    <td WIDTH="30" VALIGN="TOP" height="18"></td>
    </font>

</b>

    <td WIDTH="123" VALIGN="TOP" align="right" height="18"><font face="Arial" size="2">4,617
      &nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </font></td>
  </tr>

  <tr>
    <td WIDTH="249" VALIGN="TOP" height="18"><font face="Arial" size="2">Net debt (total debt less cash)</font></td>
    <td WIDTH="15" VALIGN="TOP" height="18"><font face="Arial" size="2">&nbsp;&nbsp;</font></td>

    <td WIDTH="123" VALIGN="TOP" align="right" height="18"><font size="2" face="Arial">2,977
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font>

    </td>

    <td WIDTH="22" VALIGN="TOP" height="18"><font face="Arial" size="2">&nbsp;&nbsp;</font></td>
    <td WIDTH="123" VALIGN="TOP" align="right" height="18"><font face="Arial" size="2">2,793
      &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>

    <td WIDTH="30" VALIGN="TOP" height="18"><font face="Arial" size="2">&nbsp;&nbsp;</font></td>

    <td WIDTH="123" VALIGN="TOP" align="right" height="18"><font face="Arial" size="2">3,280
      &nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </font></td>

  </tr>
  <tr>
    <td WIDTH="249" VALIGN="TOP" height="18"><font face="Arial" size="2">Shareowners' equity</font></td>

    <td WIDTH="15" VALIGN="TOP" height="18"><font face="Arial" size="2">&nbsp;&nbsp;</font></td>
    <td WIDTH="123" VALIGN="TOP" align="right" height="18"><font size="2" face="Arial">8,680
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font>

    </td>

    <td WIDTH="22" VALIGN="TOP" height="18"><font face="Arial" size="2">&nbsp;&nbsp;</font></td>
    <td WIDTH="123" VALIGN="TOP" align="right" height="18"><font face="Arial" size="2">8,355
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </font></td>

    <td WIDTH="30" VALIGN="TOP" height="18"><font face="Arial" size="2">&nbsp;&nbsp;</font></td>
    <td WIDTH="123" VALIGN="TOP" align="right" height="18"><font face="Arial" size="2">8,646
      &nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </font></td>

  </tr>
  <tr>
    <td WIDTH="264" VALIGN="TOP" colspan="2" height="11"><font face="Arial" size="2">Total
      capitalization (debt plus equity)</font></td>

    <td WIDTH="123" VALIGN="TOP" align="right" height="11">

    <font face="Arial" size="2">13,584
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font>
    </td>

    <td WIDTH="22" VALIGN="TOP" height="11"></td>
    <td WIDTH="123" VALIGN="TOP" align="right" height="11">

   <font face="Arial" size="2">13,228
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font>
    </td>

    <td WIDTH="30" VALIGN="TOP" height="11"></td>
    <td WIDTH="123" VALIGN="TOP" align="right" height="11">

    <font face="Arial" size="2">13,263
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font>
    </td>

  </tr>
  <tr>
    <td WIDTH="249" VALIGN="TOP" height="18"><font face="Arial" size="2">Debt to total capitalization</font></td>

    <td WIDTH="15" VALIGN="TOP" height="18"><font face="Arial" size="2">&nbsp;&nbsp;</font></td>
    <td WIDTH="123" VALIGN="TOP" align="right" height="18"><font size="2" face="Arial">36%
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font>

    </td>

    <td WIDTH="22" VALIGN="TOP" height="18"><font face="Arial" size="2">&nbsp;&nbsp;</font></td>
    <td WIDTH="123" VALIGN="TOP" align="right" height="18"><font face="Arial" size="2">37%
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </font></td>

    <td WIDTH="30" VALIGN="TOP" height="18"><font face="Arial" size="2">&nbsp;&nbsp;</font></td>
    <td WIDTH="123" VALIGN="TOP" align="right" height="18"><font face="Arial" size="2">35%
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </font></td>

  </tr>
  <tr>
    <td WIDTH="249" VALIGN="TOP" height="18"><font face="Arial" size="2">Net debt to total capitalization</font></td>

    <td WIDTH="15" VALIGN="TOP" height="18"><font face="Arial" size="2">&nbsp;&nbsp;</font></td>
    <td WIDTH="123" VALIGN="TOP" align="right" height="18"><font size="2" face="Arial">26%
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font>

    </td>

    <td WIDTH="22" VALIGN="TOP" height="18"><font face="Arial" size="2">&nbsp;&nbsp;</font></td>
    <td WIDTH="123" VALIGN="TOP" align="right" height="18"><font face="Arial" size="2">25%
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </font></td>

    <td WIDTH="30" VALIGN="TOP" height="18"><font face="Arial" size="2">&nbsp;&nbsp;</font></td>
    <td WIDTH="123" VALIGN="TOP" align="right" height="18"><font face="Arial" size="2">28%
    &nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </font></td>

  </tr>

<font FACE="Arial" SIZE="2">

<b>

</table>

  </center>
</div>

</b>

<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; Net cash flows provided by operating
activities decreased $349 million in the first three months of 2003 compared to
the corresponding period in 2002, due primarily to a $500 million cash
contribution to the Corporation's domestic defined benefit pension plans,
partially offset by improved working capital performance.</p>

<p align="center">17</p>

<b>

<hr>
<b>

<p align="center">UNITED TECHNOLOGIES CORPORATION<br>
AND SUBSIDIARIES</p></b>
</b>

<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; Cash used in investing activities decreased $160 million in
the first three months of 2003 compared with the same period of 2002, primarily
due to lower capital expenditures and investments in businesses. The decrease in
capital expenditures is due to a rationalization and timing of capital projects. Capital
expenditures for the year 2003 are expected to approximate anticipated
depreciation levels. Cash
spending for investments in businesses for the first three months of 2003 was
$18 million. While the Corporation has targeted acquisition activity for the full
year 2003 in the $1.5 billion range, actual acquisition spending may vary
depending upon the availability of appropriate acquisition opportunities.&nbsp;

</font>

  </p>
<p ALIGN="JUSTIFY">

<font face="Arial" SIZE="2">

&nbsp;&nbsp;&nbsp; Customer financing activity was a net use of cash of $9
million in the first three months of 2003 compared with a $1 million source of
cash in the first three months of 2002, reflecting higher customer generated
financing requirements. While the Corporation expects that 2003 customer
financing activity will be a net use of funds, actual funding is subject to
usage under existing customer financing commitments during the remainder of the
year. The Corporation had financing and rental commitments of $1.6 billion
related to commercial aircraft at March 31, 2003 and December 31, 2002. The Corporation may
also arrange for third-party investors to assume a portion of its commitments.&nbsp;

</font>

  </p>

<font FACE="Arial" SIZE="2">

<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; Net cash flows used in financing activities decreased $217
million in the first three months of 2003 compared with the same period of 2002,
due primarily to lower debt and short-term borrowing repayments as well as less
Common Stock issued on fewer option exercises, partially offset by higher Common
Stock repurchase activity. Under a shelf registration statement previously filed
with the Commission, the Corporation can issue approximately $1.1 billion of
additional debt and equity securities.<font FACE="Arial" SIZE="3">&nbsp;</p>
</font>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; The Corporation repurchased $201 million of Common Stock,
representing 3.4 million shares, in the first three months of 2003 under
previously announced share repurchase programs. In October 2002, the Corporation
announced that the Board of Directors authorized the repurchase of up to 30
million shares. The new authorization replaces the previous share repurchase
authority. The Corporation has targeted total share repurchases in 2003 of approximately $700
million, however, total repurchases may vary depending upon the level of other
investing activities. The share repurchase programs continue to be a use of
the Corporation's cash flows and have more than offset the dilutive effect
resulting from the issuance of stock and options under stock-based employee
benefit programs.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; The funded status of the Corporation's pension plans is
dependent upon many factors, including returns on invested assets and the level
of market interest rates. The Corporation can contribute cash to these plans at
its discretion and made an additional $500 million cash contribution to its
domestic pension plans in January 2003.<font FACE="Arial" SIZE="3">&nbsp;</p>
</font>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; The Corporation manages its worldwide cash requirements
considering available funds among the many subsidiaries through which it
conducts its business and the cost effectiveness with which those funds can be
accessed. The repatriation of cash balances from certain of the Corporation's
subsidiaries could have adverse tax consequences; however, those balances are
generally available without legal restrictions to fund ordinary business
operations. The Corporation has and will continue to transfer cash from those
subsidiaries to the parent and to other international subsidiaries when it is
cost effective to do so.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; Management believes that its existing cash position and other
available sources of liquidity are sufficient to meet current and anticipated
requirements for the foreseeable future. Although variations in acquisition
spending could cause changes in debt to capital levels, management anticipates that the
year-end 2003 debt-to-capital level will approximate prior year levels.</p>
<p ALIGN="center">18</p>

<b>

<b>

<hr>
  <font face="Arial" size="2">

<p align="center">UNITED TECHNOLOGIES CORPORATION<br>
AND SUBSIDIARIES</p>

<p ALIGN="JUSTIFY">Recent Accounting Guidance</p>

</font>
</b>
</b>

  <font face="Arial" size="2">

<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;

</font>

</font>

<font face="Arial" size="3"> </font><font FACE="Arial" SIZE="2">In January 2003,
Financial Accounting Standards Board Interpretation (&quot;FIN&quot;) No. 46, "Consolidation of Variable
Interest Entities" was issued. The interpretation
provides guidance on consolidating variable interest entities and applies
immediately to variable interests created after January 31, 2003. The guidelines
of the interpretation will become applicable for the Corporation in its third
quarter 2003 financial statements for variable interest entities created before
February 1, 2003. The interpretation requires variable interest entities to be
consolidated if the equity investment at risk is not sufficient to permit an
entity to finance its activities without support from other parties or the
equity investors lack certain specified characteristics.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; The adoption of FIN 46 for variable interests created after
January 31, 2003 did not have a material impact on the Corporation's
consolidated financial condition, results of operations or cash flows. The
Corporation is continuing to review the provisions of FIN 46 to determine its
impact, if any, on future reporting periods with respect to interests in
variable interest entities created prior to February 1, 2003, and does not
currently anticipate any material accounting or disclosure requirement under the
provisions of the interpretation.</p>

  <p align="center">19</p>
<b>
  <hr>
</b>
<p style="tab-stops: .25in" align="center">
<b>UNITED TECHNOLOGIES CORPORATION<br>
AND SUBSIDIARIES
</b>

</p>
<b>
<p>&nbsp;&nbsp;&nbsp; Item 3. Quantitative and Qualitative Disclosures about
Market Risk</p>
 </b>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;

</font>

 <font FACE="Arial" SIZE="2">There has been no significant change in the
 Corporation's exposure to market risk during the first three months of 2003.
 For discussion of the Corporation's exposure to market risk, refer to Item 7A,
 Quantitative and Qualitative Disclosures about Market Risk, contained in the
 Corporation's Annual Report incorporated by reference in Form 10-K for the
 calendar year 2002.</p>
<p><b>&nbsp;&nbsp;&nbsp;</b>

</font>

 <font FACE="Arial" SIZE="2"><b>Item 4. Controls and Procedures</p>
</b>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; During the 90-day period prior to the
filing date of this report, management, including the Corporation's Chief
Executive Officer and Vice Chairman and Chief Financial Officer, evaluated the
effectiveness of the design and operation of the Corporation's disclosure
controls and procedures. Based upon, and as of the date of that evaluation, the
Chief Executive Officer and Vice Chairman and Chief Financial Officer concluded
that the disclosure controls and procedures were effective, in all material
respects, to ensure that information required to be disclosed in the reports the
Corporation files and submits under the Exchange Act is recorded, processed,
summarized and reported as and when required.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; There have been no significant changes in
the Corporation's internal controls or in other factors which could
significantly affect internal controls subsequent to the date the Corporation
carried out its evaluation. There were no significant deficiencies or material
weaknesses identified in the evaluation and, therefore, no corrective actions
were taken.</p>
<p align="center">20</p>
  <i>
<hr>
</i>
<p ALIGN="center"><b>UNITED TECHNOLOGIES CORPORATION<br>
AND SUBSIDIARIES
</b>

</p>
<i>
 </i>
<b>
<p ALIGN="CENTER">CAUTIONARY NOTE CONCERNING FACTORS THAT MAY AFFECT FUTURE
RESULTS</p>
</b><font FACE="Arial" SIZE="3"></font>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; This report on Form 10-Q contains
statements which, to the extent they are not statements of historical or present
fact, constitute "forward-looking statements" under the securities
laws. From time to time, oral or written forward-looking statements may also be
included in other materials released to the public. These forward-looking
statements are intended to provide management's current expectations or plans
for the future operating and financial performance of the Corporation, based on
assumptions currently believed to be valid. Forward-looking statements can be
identified by the use of words such as "believe," "expect,"
"plans," "strategy," "prospects,"
"estimate," "project," &quot;target,&quot; "anticipate" and other
words of similar meaning in connection with a discussion of future operating or
financial performance. These include, among others, statements relating to:</p>
<ul>
  <li>
    <p ALIGN="JUSTIFY">Future earnings and other measurements of financial
    performance</li></ol>
  <li>
    <p ALIGN="JUSTIFY">Future cash flow and uses of cash</li></ol>
  <li>
    <p ALIGN="JUSTIFY">The effect of economic downturns or growth in particular
    regions</li></ol>
  <li>
    <p ALIGN="JUSTIFY">The effect of changes in the level of activity in
    particular industries or markets</li></ol>
  <li>
    <p ALIGN="JUSTIFY">The scope, nature or impact of acquisition activity and
    integration into the Corporation's businesses</li></ol>
  <li>
    <p ALIGN="JUSTIFY">Product developments and new business opportunities</li></ol>
  <li>
    <p ALIGN="JUSTIFY">Restructuring costs and savings</li></ol>
  <li>
    <p ALIGN="JUSTIFY">The outcome of contingencies</li></ol>
  <li>
    <p ALIGN="JUSTIFY">Future repurchases of Common Stock</li></ol>
  <li>
    <p ALIGN="JUSTIFY">Future levels of indebtedness and capital spending</li></ol>
  <li>
    <p ALIGN="JUSTIFY">Pension plan assumptions and future contributions.</li></ol>
</ul>
<blockquote>
  <font FACE="Arial" SIZE="3">
  </blockquote>
</font>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; All forward-looking statements involve
risks and uncertainties that may cause actual results to differ materially from
those expressed or implied in the forward-looking statements. This Quarterly
Report on Form 10-Q includes important information as to risk factors in the
"Notes to Condensed Consolidated Financial Statements" under the
heading "Contingent Liabilities" and in the section titled
"Management's Discussion and Analysis of Financial Condition and Results
of Operations" under the headings "Business Environment,"
"Results of Continuing Operations," "Liquidity and Financial
Condition" and "Critical Accounting Estimates." The Corporation's
Annual Report on Form 10-K for 2002 also includes important information as to
risk factors in the "Business" section under the headings
"General," "Description of Business by Segment" and
"Other Matters Relating to the Corporation's Business as a Whole"
and in the "Legal Proceedings" section. Additional important
information as to risk factors is included in the Corporation's 2002 Annual
Report to Shareowners in the section titled "Management's Discussion and
Analysis of Financial Condition and Results of Operations" under the
headings "Business Environment," "Critical Accounting
Estimates," "Environmental Matters" and "Restructuring and
Other Costs." For additional information identifying factors that may cause
actual results to vary materially from those stated in the forward-looking
statements, see the Corporation's reports on Forms 10-Q and 8-K filed with the
Securities and Exchange Commission from time to time.</p>
<p align="center">21</p>
  <i>
<hr>
</i>
<p align="center"><b>UNITED TECHNOLOGIES CORPORATION<br>
AND SUBSIDIARIES</b>&nbsp;</p>

<p align="left"><b>Part II - Other Information</p>

<p>Item 1. Legal Proceedings</p>
</b>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; As previously reported, the U.S.
Department of Defense (DoD) and the Corporation are litigating whether Pratt
&amp; Whitney's accounting practices for certain engine parts are acceptable.
The litigation, filed in 1994 with the Armed Services Board of Contract Appeals
("ASBCA"), No. 47416 et al., relates to the accounting for engine
parts produced by foreign companies under commercial engine collaboration
programs from 1984 through 1995. On January 15, 2003, the Court reversed the
ASBCA and remanded the case to the ASBCA for further proceedings. The
Corporation sought reconsideration of this decision by the Court in late
February 2003. No decision has been issued.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; As previously reported, the Corporation
had pending against it one qui tam complaint under the civil False Claims Act in
United States District Court for the District of Connecticut: U.S. ex rel. Drake
v. Norden Systems, Inc. and UTC, No. 394CV00963 (filed July 1997, and involving
allegations of improper accounting for fixed assets). In February 2003, the case
was dismissed. The relator has moved for reconsideration.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;

</font>

 <font FACE="Arial" SIZE="2">As previously reported, in March 1999, the U.S.
 Department of Justice filed a civil False Claims Act complaint against the
 Corporation in United States District Court for the Southern District of Ohio
 (Western Division), No. C-3-99-093. This lawsuit relates to the "Fighter
 Engine Competition" between Pratt &amp; Whitney's F100 engine and GE's
 F110 engine, for contracts awarded by the U.S. Air Force between fiscal years
 1985 and 1990, inclusive. The Government alleges that Pratt &amp; Whitney
 inflated its estimated costs for purchased parts and withheld data that would
 have revealed the overstatements. In mid-2002, the Court denied motions filed
 by Pratt &amp; Whitney that could have resulted in dismissal of all or part of
 the Government's claims. The Corporation requested that the Court reconsider
 this denial. This request was denied in March 2003. Trial of this matter is
 anticipated in the first quarter of 2004.</p>
<p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp;

</font>

 <font FACE="Arial" SIZE="2">Except as noted above, there have been no material
 developments in legal proceedings. For a description of previously reported
 legal proceedings, refer to Part I, Item 3, Legal Proceedings of the
 Corporation's Annual Report on Form 10-K for 2002.

</font>

  </p>
  <font FACE="Arial" SIZE="2">
  <p ALIGN="JUSTIFY">&nbsp;&nbsp;&nbsp; The Corporation does not believe that
  the resolution of the foregoing legal matters will have a material adverse
  effect upon the Corporation's competitive position, results of operations,
  cash flow or financial condition.</p>
  <p ALIGN="center">22</p>
  <hr>
<p align="center"><b>UNITED TECHNOLOGIES CORPORATION<br>
AND SUBSIDIARIES</b>&nbsp;</p>

<blockquote>

<p ALIGN="left"><b>&nbsp;Item 6.&nbsp;&nbsp;&nbsp; Exhibits and Reports on Form 8-K</p>

<p></b>&nbsp;&nbsp;&nbsp;
(a)&nbsp; Exhibits</p>

<b>

<i>

  <div align="left"><table border="0" cellspacing="0" width="622">
    <tr>
      <td width="47"></td>
    </i>
      <td width="70"><font face="Arial" size="2">(12)</font></td>
      <td width="601"><font face="Arial" size="2">Statement re: computation of ratio of earnings
      to fixed charges. *</font></td>
    </tr>

<i>

    <tr>
      <td width="47"></td>
</i>
      <td width="70"><font face="Arial" size="2">(15)</font></td>
      <td width="601"><font face="Arial" size="2">Letter re: unaudited interim financial
      information. *</font></td>
    </tr>

<i>

    <tr>
      <td height="10" width="47"></td>
</i>
  </font>
      <td height="10" width="70">
        <p align="left"><font face="Arial" size="2">(99) </font></p>
    </td>
      <td height="10" width="601">
  <font face="Arial" size="2">
  Additional Exhibit. *
  </font></td>
    </tr>
  </table>
  </div>
</blockquote>

  <font FACE="Arial" SIZE="2">

<i>

<blockquote>

</i>

<p><font face="Arial" size="2">&nbsp;&nbsp;&nbsp; </font></b><font face="Arial" size="2">(b)&nbsp; Reports on Form
8-K</font></p>

<table border="0" cellspacing="0" width="622">
    <tr>
      <font FACE="Arial" SIZE="2">

<b>

<i>

      <td width="47"></td>
    </i>
      </b>
      <td width="671">
        <p align="JUSTIFY"><font FACE="Arial" SIZE="2">On March 5, 2003, the
        Corporation filed a Report on Form 8-K incorporating, under Item 5, a
        March 5, 2003 press release announcing that Gregory J. Hayes had been
        named Vice President and Controller of the Corporation and that David G.
        Nord had been named Vice President of Finance and Chief Financial
        Officer of the Corporation's Hamilton Sundstrand subsidiary.

</font>

        </p>
        <p align="left"><font FACE="Arial" SIZE="2">* Submitted electronically herewith.

</font>

      </td>
      </font>
    </tr>

  </table>
  </font><font FACE="Arial" SIZE="2">
</blockquote>

<p align="center"><font face="Arial" size="2">2</font>3</p>

<b>

<i>

<hr>

</i>

<p align="center"><font face="Arial" size="2">UNITED TECHNOLOGIES CORPORATION<br>
AND SUBSIDIARIES</font><font FACE="Arial" SIZE="3"></p>

<p align="center"></font><font face="Arial" size="2">SIGNATURES</font></p>

<p></b>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.</p>

<p>&nbsp;</p>

<b>

<i>

<div align="center">

<center>

<table border="0" cellspacing="0" width="500">
  <tr>
    <td width="44%" height="21"></td>
  </i>
    <td width="118%" height="21"><font face="Arial" size="2">UNITED TECHNOLOGIES CORPORATION</font></td>
  </tr>

</font>

<i>

  <tr>
    <td width="44%" height="18"><font face="Arial" size="2">&nbsp;&nbsp;</font></td>
    <td width="118%" height="18"><font face="Arial" size="2">&nbsp;&nbsp;</font></td>
  </tr>
</i>

<font FACE="Arial" SIZE="2">

<font FACE="Arial" SIZE="2">
  <tr>
    <td width="44%" height="21"><font face="Arial" size="2">Dated:&nbsp; April
      23, 2003</font></td>
    <td width="118%" height="21" style="border-bottom-style: solid; border-bottom-width: thin"><font face="Arial" size="2">By: /s/ Stephen
      F. Page</font></td>
  </tr>

<i>

  <tr>
    <td width="44%" height="21"></td>
</i>
    <td width="118%" height="21"><font face="Arial" size="2">Stephen F. Page<br>
      Vice Chairman and Chief Financial Officer</font></td>
  </tr>

</font></font>

<i>

  <tr>
    <td width="44%" height="21"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
    <td width="118%" height="21"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
  </tr>
</i>

<font FACE="Arial" SIZE="2">

<font FACE="Arial" SIZE="2">

<i>

</i>
  <tr>
    <td width="44%" height="21"><font face="Arial" size="2">Dated:&nbsp; April
      23, 2003</font></td>
    <td width="118%" height="21" style="border-bottom-style: solid; border-bottom-width: thin"><font face="Arial" size="2">By: /s/ William H. Trachsel</font></td>
  </tr>

<i>

  <tr>
    <td width="44%" height="21"></td>
</i>
  </b>

    <td width="118%" height="21"><font face="Arial" size="2">William H. Trachsel<br>
      Senior Vice President, General
    Counsel and Secretary</font></td>
</tr>
</font></font>

  <tr>
    <td width="44%" height="21"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>

    <td width="118%" height="21"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
  </tr>

<font FACE="Arial" SIZE="2">

<font FACE="Arial" SIZE="2">

<tr>
    <td width="44%" height="21"><font face="Arial" size="2">Dated:&nbsp; April
      23, 2003</font></td>
    <td width="118%" height="21" style="border-bottom-style: solid; border-bottom-width: thin"><font face="Arial" size="2">By: /s/ David G. Nord</font></td>
</tr>

<i>

<b>

<tr>
    <td width="44%" height="21"></td>
</b>

</i>
    <td width="118%" height="21"><font face="Arial" size="2">David G. Nord<br>
 Vice President, Controller *</font></td>
</tr>

<i>

<b>

<tr>
    <td width="44%" height="21"></td>
    <td width="118%" height="21"></td>
</tr>

</b>

</i>

</table>
</center>
</div>

</font>
</font>
<div align="center">
  <center>
  <table border="0" cellspacing="1" width="500" style="font-family: Arial; font-size: 10pt">
    <tr>
      <td width="9">

<font face="Arial" size="2">

*
</font></td>
      <td width="477">

<font face="Arial" size="2">

Mr. Nord continued to perform his duties as outgoing Vice President, Controller</font>
      </td>
    </tr>

<font FACE="Arial" SIZE="2">

<font FACE="Arial" SIZE="2">

<tr>
  <td width="9"></td>
  <td width="477"> with respect to preparation and filing of this Form 10-Q, notwithstanding his</td>
</tr>
<tr>
  <td width="9"></td>
  <td width="477">appointment as Vice President of Finance and Chief
    Financial Officer</td>
</tr>
<tr>
  <td width="9"></td>
  <td width="477">of the Corporation's Hamilton Sundstrand subsidiary on April
    1, 2003.</td>
</tr>
</table>
    </center>
  </div>

<p align="center">24</p>

<b>

<i>

<hr>

</i>

<p align="center">UNITED TECHNOLOGIES CORPORATION<br>
AND SUBSIDIARIES<font FACE="Arial" SIZE="3"></p>
<p align="center"></font>

</b>


CERTIFICATIONS</p>
<p align="JUSITFY">I, George David, certify that:</p>
<ol>
  <li style="font-family: Arial; font-size: 10pt">
    <p align="JUSITFY">I have reviewed this quarterly report on Form 10-Q of
    United Technologies Corporation;</li>
</ol>
<ol style="font-family: Arial; font-size: 10pt">
  <li style="font-family: Arial; font-size: 10pt" value="2">
    <p align="JUSITFY">Based on my knowledge, this quarterly report does not
    contain any untrue statement of a material fact or&nbsp; omit to state a
    material fact necessary to make the statements made, in light of the
    circumstances under which such statements were made, not misleading with
    respect to the period covered by this quarterly report;</li>
</ol>
<ol style="font-family: Arial; font-size: 10pt">
  <li style="font-family: Arial; font-size: 10pt" value="3">
    <p align="JUSITFY">Based on my knowledge, the financial statements, and
    other financial information included in this quarterly report, fairly
    present in all material respects the financial condition, results of
    operations and cash flows of the registrant as of, and for, the periods
    presented in this quarterly report;</li>
</ol>
<ol style="font-family: Arial; font-size: 10pt">
  <li style="font-family: Arial; font-size: 10pt" value="4">
    <p align="JUSITFY">The registrant's other certifying officers and I are
    responsible for establishing and maintaining disclosure controls and
    procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the
    registrant and we have:</li>
</ol>
<blockquote>
  <ol style="font-family: Arial; font-size: 10pt" type="a">
    <li style="font-family: Arial; font-size: 10pt">
      <p align="JUSITFY">designed such disclosure controls and procedures to
      ensure that material information relating to the registrant, including its
      consolidated subsidiaries, is made known to us by others within those
      entities, particularly during the period in which this quarterly report is
      being prepared;</li>
  </ol>
  <ol style="font-family: Arial; font-size: 10pt" type="a" start="2">
    <li style="font-family: Arial; font-size: 10pt" value="2">
      <p align="JUSITFY">evaluated the effectiveness of the registrant's
      disclosure controls and procedures as of a date within 90 days prior to the
      filing date of this quarterly report (the "Evaluation Date");
      and</li>
  </ol>
  <ol style="font-family: Arial; font-size: 10pt" type="a" start="4">
    <li style="font-family: Arial; font-size: 10pt" value="3">
      <p align="JUSITFY">presented in this quarterly report our conclusions
      about the effectives of the disclosure controls and procedures based on
      our evaluation as of the Evaluation Date;</li>
  </ol>
</blockquote>
<ol style="font-family: Arial; font-size: 10pt">
  <li style="font-family: Arial; font-size: 10pt" value="5">
    <p align="JUSITFY">The registrant's other certifying officers and I have
    disclosed, based on our most recent evaluation, to the registrant's auditors
    and the audit committee of registrant's board of directors (or persons
    performing the equivalent function):</li>
</ol>
<blockquote>
  <ol style="font-family: Arial; font-size: 10pt" type="a">
    <li style="font-family: Arial; font-size: 10pt">
      <p align="JUSITFY">all significant deficiencies in the design or operation
      of internal controls which could adversely affect the registrant's ability
      to record, process, summarize and report financial data and have
      identified for the registrant's auditors any material weaknesses in
      internal controls; and</li>
  </ol>
  <ol style="font-family: Arial; font-size: 10pt" type="a" start="2">
    <li style="font-family: Arial; font-size: 10pt" value="2">
      <p align="JUSITFY">any fraud, whether or not material, that involves
      management or other employees who have a significant role in the
      registrant's internal controls; and</li>
  </ol>
</blockquote>
<ol style="font-family: Arial; font-size: 10pt">
  <li style="font-family: Arial; font-size: 10pt" value="6">
    <p align="JUSITFY">The registrant's other certifying officers and I have
    indicated in this quarterly report whether or not there were significant
    changes in internal controls or in other factors that could significantly
    affect internal controls subsequent to the date of our most recent
    evaluation, including any corrective actions with regard to significant
    deficiencies and material weaknesses.</li>

<i>

<b>

<p align="left">&nbsp;</p>
<table border="0" cellspacing="1" width="85%" height="1">
  <tr>
    <td width="9%" height="1"></td>
    <td width="36%" height="1"></td>

</b>


</i>

<td width="55%" style="border-bottom-style: solid; border-bottom-width: thin" height="1"><font face="Arial" size="2">/s/
  George David</font></td>
</tr>
<tr>
  <td width="9%" style="font-family: Arial; font-size: 10pt" valign="bottom" height="34"><font face="Arial" size="2">Date:</font></td>
  <td width="36%" style="font-family: Arial; font-size: 10pt" valign="bottom" height="34"><font face="Arial" size="2">April
    23,&nbsp; 2003</font></td>
  <td width="55%" height="34"><font face="Arial" size="2">George David<br>
    Chairman and Chief Executive Officer</font></td>
</tr>
  </table>
</ol>
<p align="center">25</p>

<i>

<b>

<hr>

</b>


</i>

<p align="center"><b>UNITED TECHNOLOGIES CORPORATION<br>
AND SUBSIDIARIES</b><font FACE="Arial" SIZE="3"></p>
<p align="center"></font>CERTIFICATIONS</p>
<p align="JUSITFY">I, Stephen F. Page, certify that:</p>
<ol>
  <li style="font-family: Arial; font-size: 10pt">
    <p align="JUSITFY">I have reviewed this quarterly report on Form 10-Q of
    United Technologies Corporation;</li>
</ol>
<ol style="font-family: Arial; font-size: 10pt">
  <li style="font-family: Arial; font-size: 10pt" value="2">
    <p align="JUSITFY">Based on my knowledge, this quarterly report does not
    contain any untrue statement of a material fact or&nbsp; omit to state a
    material fact necessary to make the statements made, in light of the
    circumstances under which such statements were made, not misleading with
    respect to the period covered by this quarterly report;</li>
</ol>
<ol style="font-family: Arial; font-size: 10pt">
  <li style="font-family: Arial; font-size: 10pt" value="3">
    <p align="JUSITFY">Based on my knowledge, the financial statements, and
    other financial information included in this quarterly report, fairly
    present in all material respects the financial condition, results of
    operations and cash flows of the registrant as of, and for, the periods
    presented in this quarterly report;</li>
</ol>
<ol style="font-family: Arial; font-size: 10pt">
  <li style="font-family: Arial; font-size: 10pt" value="4">
    <p align="JUSITFY">The registrant's other certifying officers and I are
    responsible for establishing and maintaining disclosure controls and
    procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the
    registrant and we have:</li>
</ol>
<blockquote>
  <ol style="font-family: Arial; font-size: 10pt" type="a">
    <li style="font-family: Arial; font-size: 10pt">
      <p align="JUSITFY">designed such disclosure controls and procedures to
      ensure that material information relating to the registrant, including its
      consolidated subsidiaries, is made known to us by others within those
      entities, particularly during the period in which this quarterly report is
      being prepared;</li>
  </ol>
  <ol style="font-family: Arial; font-size: 10pt" type="a" start="2">
    <li style="font-family: Arial; font-size: 10pt" value="2">
      <p align="JUSITFY">evaluated the effectiveness of the registrant's
      disclosure controls and procedures as of a date within 90 days prior to the
      filing date of this quarterly report (the "Evaluation Date");
      and</li>
  </ol>
  <ol style="font-family: Arial; font-size: 10pt" type="a" start="3">
    <li style="font-family: Arial; font-size: 10pt">
      <p align="JUSITFY">presented in this quarterly report our conclusions
      about the effectives of the disclosure controls and procedures based on
      our evaluation as of the Evaluation Date;</li>
  </ol>
</blockquote>
<ol style="font-family: Arial; font-size: 10pt">
  <li style="font-family: Arial; font-size: 10pt" value="5">
    <p align="JUSITFY">The registrant's other certifying officers and I have
    disclosed, based on our most recent evaluation, to the registrant's auditors
    and the audit committee of registrant's board of directors (or persons
    performing the equivalent function):</li>
</ol>
<blockquote>
  <ol style="font-family: Arial; font-size: 10pt" type="a">
    <li style="font-family: Arial; font-size: 10pt">
      <p align="JUSITFY">all significant deficiencies in the design or operation
      of internal controls which could adversely affect the registrant's ability
      to record, process, summarize and report financial data and have
      identified for the registrant's auditors any material weaknesses in
      internal controls; and</li>
  </ol>
  <ol style="font-family: Arial; font-size: 10pt" type="a" start="2">
    <li style="font-family: Arial; font-size: 10pt" value="2">
      <p align="JUSITFY">any fraud, whether or not material, that involves
      management or other employees who have a significant role in the
      registrant's internal controls; and</li>
  </ol>
</blockquote>
<ol style="font-family: Arial; font-size: 10pt">
  <li style="font-family: Arial; font-size: 10pt" value="6">
    <p align="JUSITFY">The registrant's other certifying officers and I have
    indicated in this quarterly report whether or not there were significant
    changes in internal controls or in other factors that could significantly
    affect internal controls subsequent to the date of our most recent
    evaluation, including any corrective actions with regard to significant
    deficiencies and material weaknesses.</li>

<b>

<i>

<p align="left">&nbsp;</p>
<table border="0" cellspacing="1" width="85%" height="1">
  <tr>
    <td width="9%" height="1"></td>
    <td width="36%" height="1"></td>

</i>

</b>


<td width="55%" style="border-bottom-style: solid; border-bottom-width: thin" height="1"><font face="Arial" size="2">/s/
  Stephen F. Page</font></td>
</tr>
<tr>
  <td width="9%" style="font-family: Arial; font-size: 10pt" valign="bottom" height="34"><font face="Arial" size="2">Date:</font></td>
  <td width="36%" style="font-family: Arial; font-size: 10pt" valign="bottom" height="34"><font face="Arial" size="2">April
    23,&nbsp; 2003</font></td>
  <td width="55%" height="34"><font face="Arial" size="2">Stephen F. Page<br>
    Vice Chairman and Chief Financial Officer</font></td>
</tr>
  </table>
</ol>
<p align="center">26</p>

<b>

<i>

<hr>

</i>

<blockquote>
  <blockquote>
    <blockquote>
      <blockquote>
        <u><p ALIGN="CENTER">EXHIBIT INDEX</p>
        </u><p ALIGN="CENTER">&nbsp;</p>
      </blockquote>
    </blockquote>
  </blockquote>
</blockquote>

</b>


<table border="0" cellspacing="0" width="100%" cellpadding="0" style="font-family: Arial; font-size: 10pt" height="80">
  <tr>
    <td width="12%" align="right" height="18"><font face="Arial" size="2">(12)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td width="88%" height="18"><font face="Arial" size="2">Statement re: computation of ratio of earnings
    to fixed charges. *</font></td>
  </tr>

<b>

<i>

  <tr>
    <td width="12%" height="18" style="font-family: Arial; font-size: 10pt" align="right"></td>
    <td width="88%" height="18" style="font-family: Arial; font-size: 10pt"></td>
  </tr>
  </i>
</b>


  <tr>
    <td width="12%" align="right" height="18"><font face="Arial" size="2">(15)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td width="88%" height="18"><font face="Arial" size="2">Letter re: unaudited interim financial
    information. *</font></td>
  </tr>

<b>

  <tr>
    <td width="12%" align="right" height="8"></td>
</b>


    <td width="88%" height="8">&nbsp;</td>
  </tr>
</font></font>
<tr>
    <td width="12%" align="right" height="18"><font face="Arial" size="2">(99)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td width="88%" height="18"><font face="Arial" size="2">Additional Exhibit.*
</font>
  </td>
</tr>
</table>

<font FACE="Arial" SIZE="2">

<font FACE="Arial" SIZE="2"><font face="Arial" size="2">


<p><font face="Arial" size="2">* Submitted electronically herewith.</font></p>

<p align="center"><font face="Arial" size="2">2</font>7</p>

<i>

<b>

<hr>
</b>
</font>
</body>
</html>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-12
<SEQUENCE>3
<FILENAME>ex12tenq103.htm
<DESCRIPTION>EX-12 3/31/03
<TEXT>
<html>

<head>
<title>ex12q103</title>
</head>

<body>

<p><font face="Arial"
size="2"><b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Exhibit 12</b></font></p>

<p align="center"><font face="Arial"
size="2"><b>UNITED TECHNOLOGIES CORPORATION<br>
</b></font><font face="Arial"
size="2"><b>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
AND SUBSIDIARIES</b></font></p>

<p align="center"><font face="Arial"
size="2"><b><u>STATEMENT RE: COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES</u></b></font></p>

<div align="center">
  <center>

  <table border="0" cellpadding="0" cellspacing="0" width="550" height="385">
    <tr>
      <td width="441" height="34" colspan="2"></td>
      <td width="18" align="right" height="34"></td>
      <td width="204" align="center" height="34" style="border-bottom-style: groove" colspan="3">
        <font face="Arial" size="2"><b><br>
        Quarter Ended<br>
        March 31,</b></font></td>
    </tr>
    <tr>
      <td width="441" height="21" colspan="2"><font face="Arial" size="2">In
        Millions of Dollars</font></td>
      <td width="18" align="right" height="21"></td>
      <td width="75" align="right" height="21" style="border-bottom-style: solid; border-bottom-width: thin">
        <p align="center"><font face="Arial" size="2"><b>2003</b></font></td>
      <td width="52" align="right" height="21"></td>
      <td width="75" align="right" height="21" style="border-bottom-style: solid; border-bottom-width: thin" class="botbord">
        <p align="center"><font face="Arial" size="2"><b>2002</b></font></td>
    </tr>
    <tr>
      <td width="19" height="8"><font size="1">&nbsp;&nbsp;</font></td>
      <td width="420" height="8"><font size="1">&nbsp;&nbsp;</font></td>
      <td width="18" align="left" height="8"><font size="1">&nbsp;&nbsp;</font></td>
      <td width="73" align="left" height="8"><font size="1">&nbsp;&nbsp;</font></td>
      <td width="52" align="left" height="8"><font size="1">&nbsp;&nbsp;</font></td>
      <td width="73" align="left" height="8"><font size="1">&nbsp;&nbsp;</font></td>
    </tr>
    <tr>
      <td width="441" height="21" colspan="2"><font face="Arial" size="2">Fixed
        Charges:</font></td>
      <td width="18" align="right" height="21"></td>
      <td width="73" align="right" height="21"></td>
      <td width="52" align="right" height="21"></td>
      <td width="73" align="right" height="21"></td>
    </tr>
    <tr>
      <td width="19" height="21"></td>
      <td width="420" height="21"><font face="Arial" size="2">Interest expense</font></td>
      <td width="18" align="right" height="21"><font face="Arial" size="2">$&nbsp;&nbsp;</font></td>
      <td width="73" align="right" height="21"><font face="Arial" size="2">91&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
      <td width="52" align="right" height="21"><font face="Arial" size="2">$&nbsp;&nbsp;</font></td>
      <td width="73" align="right" height="21"><font face="Arial" size="2">99&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    </tr>
    <tr>
      <td width="19" height="21"></td>
      <td width="420" height="21"><font face="Arial" size="2">Interest
        capitalized</font></td>
      <td width="18" align="right" height="21"></td>
      <td width="73" align="right" height="21"><font face="Arial" size="2">3&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
      <td width="52" align="right" height="21"></td>
      <td width="73" align="right" height="21"><font face="Arial" size="2">4&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    </tr>
    <tr>
      <td width="19" height="21"></td>
      <td width="420" height="21"><font face="Arial" size="2">One-third of
        rents*</font></td>
      <td width="18" align="right" height="21"></td>
      <td width="75" align="right" height="21" style="border-bottom-style: solid; border-bottom-width: thin" class="botbord"><font face="Arial" size="2">20&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
      <td width="52" align="right" height="21"></td>
      <td width="75" align="right" height="21" style="border-bottom-style: solid; border-bottom-width: thin" class="botbord"><font face="Arial" size="2">16&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    </tr>
    <tr>
      <td width="19" height="1"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
      <td width="420" height="1"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
      <td width="18" align="left" height="1"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
      <td width="73" align="left" height="1"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
      <td width="52" align="left" height="1"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
      <td width="73" align="left" height="1"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
    </tr>
    <tr>
      <td width="19" height="24"></td>
      <td width="420" height="24"><font face="Arial" size="2">Total Fixed
        Charges</font></td>
      <td width="18" align="right" height="24"><font face="Arial" size="2">$&nbsp;&nbsp;</font></td>
      <td width="75" align="right" height="24" class="double" style="border-bottom-style: double; border-bottom-width: thick"><font face="Arial" size="2">114&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
      <td width="52" align="right" height="24"><font face="Arial" size="2">$&nbsp;&nbsp;</font></td>
      <td width="75" align="right" height="24" class="double" style="border-bottom-style: double; border-bottom-width: thick"><font face="Arial" size="2">119&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    </tr>
    <tr>
      <td width="19" height="21"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
      <td width="420" height="21"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
      <td width="18" align="left" height="21"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
      <td width="73" align="left" height="21"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
      <td width="52" align="left" height="21"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
      <td width="73" align="left" height="21"><font size="1" face="Arial">&nbsp;&nbsp;</font></td>
    </tr>
    <tr>
      <td width="441" height="21" colspan="2"><font face="Arial" size="2">Earnings:</font></td>
      <td width="18" align="right" height="21"></td>
      <td width="73" align="right" height="21"></td>
      <td width="52" align="right" height="21"></td>
      <td width="73" align="right" height="21"></td>
    </tr>
    <tr>
      <td width="19" height="21"></td>
      <td width="420" height="21"><font face="Arial" size="2">Income before
        income taxes and minority interests</font></td>
      <td width="18" align="right" height="21"><font face="Arial" size="2">$&nbsp;&nbsp;</font></td>
    <td width="73" align="right" height="21" style="border-bottom-style: solid; border-bottom-width: thin"><font face="Arial" size="2">746&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <center>
    <td width="52" align="right" height="21"><font face="Arial" size="2">$&nbsp;&nbsp;</font></td>
    <td width="73" align="right" height="21" style="border-bottom-style: solid; border-bottom-width: thin"><font face="Arial" size="2">698&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    </tr>
    <tr>
      <td width="19" height="21"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
      <td width="420" height="21"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
      <td width="18" align="left" height="21"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
      <td width="73" align="left" height="21"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
      <td width="52" align="left" height="21"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
      <td width="73" align="left" height="21"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
    </tr>
    <tr>
      <td width="19" height="21"></td>
      <td width="420" height="21"><font face="Arial" size="2">Fixed charges per
        above</font></td>
      <td width="18" align="right" height="21"></td>
      <td width="73" align="right" height="21"><font face="Arial" size="2">114&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
      <td width="52" align="right" height="21"></td>
      <td width="73" align="right" height="21"><font face="Arial" size="2">119&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    </tr>
    <tr>
      <td width="19" height="21"></td>
      <td width="420" height="21"><font face="Arial" size="2">Less: interest
        capitalized</font></td>
      <td width="18" align="right" height="21"></td>
      <td width="73" align="right" height="21" class="botbord"><font face="Arial" size="2">(3)&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
      <td width="52" align="right" height="21"></td>
      <td width="73" align="right" height="21" class="botbord"><font face="Arial" size="2">(4)&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    </tr>
    <tr>
      <td width="19" height="21"></td>
      <td width="420" height="21"></td>
      <td width="18" align="right" height="21"></td>
      <td width="75" align="right" height="21" class="botbord" style="border-top-style: solid; border-top-width: thin; border-bottom-style: solid; border-bottom-width: thin"><font face="Arial" size="2">111&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
      <td width="52" align="right" height="21"></td>
      <td width="75" align="right" height="21" class="botbord" style="border-top-style: solid; border-top-width: thin; border-bottom-style: solid; border-bottom-width: thin"><font face="Arial" size="2">115&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    </tr>
    <tr>
      <td width="19" height="3"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
      <td width="420" height="3"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
      <td width="18" align="left" height="3"><font face="Arial" size="1">&nbsp;</font></td>
      <td width="73" align="left" height="3"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
      <td width="52" align="left" height="3"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
      <td width="73" align="left" height="3"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
    </tr>
    <tr>
      <td width="19" height="21"></td>
      <td width="420" height="21"><font face="Arial" size="2">Amortization of
        interest capitalized</font></td>
      <td width="18" align="right" height="21"></td>
      <td width="75" align="right" height="21" class="botbord" style="border-bottom-style: solid; border-bottom-width: thin"><font face="Arial" size="2">1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
      <td width="52" align="right" height="21"></td>
      <td width="75" align="right" height="21" class="botbord" style="border-bottom-style: solid; border-bottom-width: thin"><font face="Arial" size="2">1&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    </tr>
    <tr>
      <td width="19" height="1"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
      <td width="420" height="1"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
      <td width="18" align="left" height="1"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
      <td width="73" align="left" height="1"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
      <td width="52" align="left" height="1"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
      <td width="73" align="left" height="1"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
    </tr>
    <tr>
      <td width="19" height="24"></td>
      <td width="420" height="24"><font face="Arial" size="2">Total Earnings</font></td>
      <td width="18" align="right" height="24"><font face="Arial" size="2">$&nbsp;&nbsp;</font></td>
      <td width="75" align="right" height="24" class="double" style="font-family: Arial; font-size: 10pt; border-bottom-style: double; border-bottom-width: thick">858<font face="Arial" size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
      <td width="52" align="right" height="24"><font face="Arial" size="2">&nbsp;</font></td>
      <td width="75" align="right" height="24" class="double" style="border-bottom-style: double; border-bottom-width: thick"><font face="Arial" size="2">814&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    </tr>
    <tr>
      <td width="19" height="1"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
      <td width="420" height="1"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
      <td width="18" align="left" height="1"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
      <td width="73" align="left" height="1"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
      <td width="52" align="left" height="1"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
      <td width="73" align="left" height="1"><font face="Arial" size="1">&nbsp;&nbsp;</font></td>
    </tr>
    <tr>
      <td width="441" height="24" colspan="2"><font face="Arial" size="2">Ratio
        of Earnings to Fixed Charges</font></td>
      <td width="18" align="right" height="24"></td>
      <td width="75" align="right" height="24" class="double" style="border-bottom-style: double; border-bottom-width: thick"><font face="Arial" size="2">7.53&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
      <td width="52" align="right" height="24"></td>
      <td width="75" align="right" height="24" class="double" style="border-bottom-style: double; border-bottom-width: thick"><font face="Arial" size="2">6.84&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    </tr>
  </table>
  </center>
  </div>
  </center>

<p><font face="Arial" size="2">* Reasonable approximation of the
interest factor.</font></p>
<hr>

</body>
</html>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-15
<SEQUENCE>4
<FILENAME>ex15tenq0103.htm
<DESCRIPTION>EX -15 3/31/03
<TEXT>
<html>

<head>
<title>Ex 15 Q1 03</title>
</head>

<body>

<p align="right"><b><font face="Arial" size="2">Exhibit
15</font></b></p>
<p><font face="Arial" size="2">April 23, 2003</font></p>
<p>&nbsp;</p>
<p><font face="Arial" size="2">Securities and Exchange
Commission<br>
450 Fifth Street, N.W.<br>
Washington, D.C.  20549</font></p>
<p><font face="Arial" size="2">Commissioners:</font></p>
<p align="Justify"><font face="Arial" size="2">We are aware that our report
dated April 17, 2003 on our review of interim financial information of United
Technologies Corporation (the "Corporation") as of and for the period ended
March 31, 2003 and included in the Corporation's quarterly report on Form 10-Q
for the quarter then ended is incorporated by reference in its Registration
Statements on Form S-3 (Nos. 333-51830 and 333-60276), in the Registration
Statement on Form S-4 (No. 333-77991) as amended by Post-Effective Amendment No.
1 on Form S-8 (No. 333-77991-01) and in the Registration Statements on Form S-8
(Nos. 333-21853, 333-18743, 333-21851, 33-57769, 33-45440, 33-11255, 33-26580,
33-26627, 33-28974, 33-51385, 33-58937, 2-87322, 333-77817, and 333-82911).</font></p>
<p><font face="Arial" size="2">Yours very truly,</font></p>
<p>&nbsp;</p>
<p><font face="Arial" size="2">/s/ PricewaterhouseCoopers LLP<br>
PricewaterhouseCoopers LLP<br>
Hartford, Connecticut</font></p>
<hr>

</body>

</html>

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99
<SEQUENCE>5
<FILENAME>q12003certification.htm
<DESCRIPTION>CERTIFICATION 3/31/03
<TEXT>
<html>

<head>
<title>Certification</title>
</head>

<body>

<b>
<p ALIGN="right"><font face="Arial" size="2">Exhibit 99</font></p>
<p ALIGN="CENTER"><font face="Arial" size="2">Certification<br>
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002<br>
(Subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States
Code)</font></p>
<p ALIGN="CENTER">&nbsp;</p>
</b>
<p ALIGN="JUSTIFY"><font face="Arial" size="2">&nbsp;&nbsp;&nbsp; Pursuant to section 906 of the
Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of section 1350, chapter 63
of title 18, United States Code), each of the undersigned officers of United
Technologies Corporation, a Delaware corporation (the &quot;<u>Company</u>&quot;),
does hereby certify that:</font></p>
<p ALIGN="JUSTIFY"><font face="Arial" size="2">&nbsp;&nbsp;&nbsp; The Quarterly Report on Form
10-Q for the quarter ended March 31, 2003 (the &quot;<u>Form 10-Q</u>&quot;) of
the Company fully complies with the requirements of section 13(a) or 15(d) of
the Securities Exchange Act of 1934 and information contained in the
Form&nbsp;10-Q fairly presents, in all material respects, the financial
condition and results of operations of the Company.</font></p>
<p>&nbsp;</p>
<table border="0" cellspacing="1" width="85%">
  <tr>
    <td width="9%"><font face="Arial" size="2">Date:</font></td>
    <td width="36%"><font face="Arial" size="2">April&nbsp;23, 2003</font></td>
    <td width="55%" style="border-bottom-style: solid; border-bottom-width: thin"><font face="Arial" size="2">/s/
      George David</font></td>
  </tr>
  <tr>
    <td width="9%" style="font-family: Arial; font-size: 10pt"></td>
    <td width="36%" style="font-family: Arial; font-size: 10pt"></td>
    <td width="55%"><font face="Arial" size="2">George David<br>
      Chairman and Chief Executive Officer</font></td>
  </tr>
  <tr>
    <td width="9%" style="font-family: Arial; font-size: 10pt"><font face="Arial" size="2">&nbsp; </font></td>
    <td width="36%" style="font-family: Arial; font-size: 10pt"><font face="Arial" size="2">&nbsp; </font></td>
    <td width="55%"><font face="Arial" size="2">&nbsp; </font></td>
  </tr>
  <tr>
    <td width="9%"><font face="Arial" size="2">Date:</font></td>
    <td width="36%"><font face="Arial" size="2">April&nbsp;23, 2003</font></td>
    <td width="55%" style="border-bottom-style: solid; border-bottom-width: thin"><font face="Arial" size="2">/s/
      Stephen F. Page</font></td>
  </tr>
  <tr>
    <td width="9%"></td>
    <td width="36%"></td>
    <td width="55%"><font face="Arial" size="2">Stephen F. Page<br>
 Vice Chairman and Chief Financial Officer</font></td>
  </tr>
</table>
<p ALIGN="JUSTIFY"><font face="Arial" size="2">&nbsp;&nbsp;&nbsp; A signed original of this
certification has been provided to the Company and will be retained by the
Company and furnished to the Securities and Exchange Commission or its staff
upon request. The foregoing certification is accompanying the Form 10-Q solely
pursuant to section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and
(b) of section 1350, chapter 63 of title 18, United States Code) and is not
being filed as part of the Form 10-Q or as a separate disclosure document.</font></p>
<hr>

</body>

</html>

</TEXT>
</DOCUMENT>
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