Ties Weekly Update #7

27 May, 2004

AHEAD OF SCHEDULE

As of 27 May, we have installed over 65,000 of the 182,000 ties scheduled to be installed by November 24^th 2004. All crews, both contractor and company are doing an excellent job and are ahead of schedule.

¨ As of 27 May, 155,000 ties have been delivered. Because of the shortage of gondolas we now expect the delivery of ties to be completed by the end of July or middle of August

¨ DME tie gang in the Lake Preston (Wes Risseeuw, foreman) will finish up the Lake Preston/ De Smet section of track next week and with the help of Earl Ruchdaschael’s surfacing crew, we will start removing slow orders from this area within the next couple weeks. Tie crew has completed over 10 miles of tie installation progress.

¨ This crew will now make the first pass tie installation from Volga to Lake Preston and then will help with the siding construction.

¨ The LA Colo tie gang has started at MP 180 and will continue toward Garvin with an expected completion date of June 25^th.

¨ All ties are installed on the Owatonna sub and Foreman Steve Koser’s crew is now installing ties in the Calmar area and then will install another 5,000 ties west of Mason City prior to installing curve rail east of Mason City.

¨ The DME West tie gang (Jim Nemec, foreman) continues to improve on their production numbers and will be installing ties just south of Rapid City for the next several weeks.