CUSTOMER FIRST SAFETY ALWAYS!! July 1, 2015 Watco Team: Happy Birthday Watco! Today we celebrate 32 years since the first time a Watco locomotive rolled down the tracks to safely serve our first Customer, Boise Cascade. Each year we continue to serve that same Customer who believed in my father and our original eight team members, and gave us the chance to provide safe and dependable service and build a great relationship that continues to this day. This last year has been a busy one, we’ve finalized our joint venture with Greenbrier to create GBW Railcar Services, purchased 29 terminals from Kinder Morgan, started up several of our own terminals, and acquired four new railroads, two of which will be starting up in a few days. We’ve been setting records in grain to port in Western Australia and we’ve restructured our service units to allow team members to take more ownership of their own work. Most importantly, the number of RPI’s are down and there is a focus on safety throughout the company that is stronger than ever. Here is my wish for Watco’s 32 nd birthday; that each of you comes to work each day because you want to serve your Customers, internal or external, in the most safe and efficient manner possible. I wish that if you find a better way to serve our Customers, you feel empowered to take the steps to do so, and I wish that each team member goes home safe to their families at the end of their workday. These past 32 years have taken us places many never dreamed we would go and I believe my father’s vision is alive and well in our team members who constantly dream of new ways to provide the best service to our Customers. I look forward to seeing what the great Watco Team can do next year and in the years to come. I have always been amazed by our performance. Again, Happy Birthday Watco Team – Remember “Customer First, Safety Always.”

CUSTOMER)FIRST)), )SAFETY)ALWAYS!! · CUSTOMER)FIRST)), )SAFETY)ALWAYS!! July 1, 2015 Watco Team: Happy Birthday Watco! Today we celebrate 32 years since the first time a Watco locomotive

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CUSTOMER FIRST -‐ SAFETY ALWAYS!!

July 1, 2015

Watco Team:

Happy Birthday Watco! Today we celebrate 32 years since the first time a Watco locomotive rolled down the tracks to safely serve our first Customer, Boise Cascade. Each year we continue to serve that same Customer who believed in my father and our original eight team members, and gave us the chance to provide safe and dependable service and build a great relationship that continues to this day.

This last year has been a busy one, we’ve finalized our joint venture with Greenbrier to create GBW Railcar Services, purchased 29 terminals from Kinder Morgan, started up several of our own terminals, and acquired four new railroads, two of which will be starting up in a few days. We’ve been setting records in grain to port in Western Australia and we’ve restructured our service units to allow team members to take more ownership of their own work. Most importantly, the number of RPI’s are down and there is a focus on safety throughout the company that is stronger than ever. Here is my wish for Watco’s 32nd birthday; that each of you comes to work each day because you want to serve your Customers, internal or external, in the most safe and efficient manner possible. I wish that if you find a better way to serve our Customers, you feel empowered to take the steps to do so, and I wish that each team member goes home safe to their families at the end of their workday. These past 32 years have taken us places many never dreamed we would go and I believe my father’s vision is alive and well in our team members who constantly dream of new ways to provide the best service to our Customers. I look forward to seeing what the great Watco Team can do next year and in the years to come. I have always been amazed by our performance. Again, Happy Birthday Watco Team – Remember “Customer First, Safety Always.”