1. Association of Car Accounting & Car Service Officers May 8, 2008

2. 1 Trackage Rights Trackage Rights Interline Freight (Bridge Traffic) Interline Freight (Bridge Traffic) Haulage vs.

3. 2 Interline Freight – traffic transported by crew, locomotives, equipment and track, in the account of the revenue waybill carrier Definition Train Haulage – traffic transported by crew and track of foreign carrier, but with locomotives and equipment in account of revenue waybill carrier. Trackage Rights – traffic transported by track of foreign carrier, but with crew, locomotives and equipment in account of revenue waybill carrier.

4. 3 Decision Core Drivers Interline Haulage Trk Rights Service Asset Utilization Cost

5. 4 Decision Components Marketing/Competition Traffic Volume Pricing/Cost Service People Liability  Interline Freight  Haulage  Trackage Rights Car Hire Asset Utilization

6. 5 Haulage or Trackage Rights ? HaulageTrk Rights Improved Service (Bridge Route)YesYes Line Rationalization/AbandonmentNoYes Capacity IssuesYesYes Marketing ReachYesNo Available CrewsNoYes Long Term Agreement MaybeYes Regulatory ApprovalNoYes Car Load TrafficYesNo Train Load Traffic YesYes CostYesYes

7. 6 Who’s Account and Responsibility (Typical) Interline Haulage Trk Rights Revenue Waybill RWC RWC RWC Marketing/Pricing RWC RWC RWC Loco/Fuel/HPH RWC RWC/FC RWC Equipment RWC RWC RWC Crew RWC FC RWC Track/Dispatching RWC FC FC Car Hire RWC RWC RWC Liability RWC RWC/FC RWC Car Repairs RWC RWC RWC Revenue Waybill Carrier = RWCForeign Carrier = FC

8. 7 Trackage/Haulage Rights Receipt and Delivery of Traffic Exclusivity Compensation and Escalation Traffic Restrictions Maintenance Management and Operations Billing Bad Orders Disclosure Liability and Indemnification Typical Haulage or Trackage Rights Agt. Components Hazardous Materials Claims Force Majeure/Acts of God Third Party Beneficiaries Regulatory Approvals Arbitration Abandonment Assignment Term Default Notices

9. 8 Resources/Other:  Available Capacity  Network Strategy  Available Crews  Competition  Other Negotiations Considerations by the Foreign Carrier to granting rights: Pricing:  Cost  OD Pair and Miles  Geography (Location)  Volume (Train vs. Car)  Slot Guarantee  Maintenance Guarantee  Market Conditions  Existing Agreements  Industry Standards

10. 9 Questions ??