Union Pacific 2011 Annual Report Download - page 13

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13
that meet our specifications. Rail is critical to our operations for rail replacement programs, maintenance,
and for adding additional network capacity, new rail and storage yards, and expansions of existing
facilities. This industry similarly has high barriers to entry, and if one of these suppliers discontinues
operations for any reason, including bankruptcy or insolvency, we could experience both significant cost
increases for rail purchases and difficulty obtaining sufficient rail for maintenance and other projects.
We May Be Affected by Acts of Terrorism, War, or Risk of War – Our rail lines, facilities, and equipment,
including rail cars carrying hazardous materials, could be direct targets or indirect casualties of terrorist
attacks. Terrorist attacks, or other similar events, any government response thereto, and war or risk of
war may adversely affect our results of operations, financial condition, and liquidity. In addition, insurance
premiums for some or all of our current coverages could increase dramatically, or certain coverages may
not be available to us in the future.
Item 1B. Unresolved Staff Comments
None.
Item 2. Properties
We employ a variety of assets in the management and operation of our rail business. Our rail network
covers 23 states in the western two-thirds of the U.S.